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Alliance Shippers, Inc v. Midland West

May 13, 2011

ALLIANCE SHIPPERS, INC., PLAINTIFF,
v.
MIDLAND WEST, INC. DEFENDANT



The opinion of the court was delivered by: Hon. Dennis M. Cavanaugh

NOT FOR PUBLICATION

OPINION

DENNIS M. CAVANAUGH, U.S.D.J.:

This matter comes before the Court upon motionby Midland West, Inc. ("Defendant") pursuant to Fed. R. Civ. P. 12(b)(6), 12(b)(2) and 12(b)(3), as well as Defendant's motion for sanctions pursuant to Fed. R. Civ. P. 11 and 28 U.S.C. § 1927.Pursuant to Fed. R. Civ. P. 78, no oral argument was heard. For the reasons stated herein, Defendant's motion to dismiss is granted with prejudice, and Defendant's motion for sanctions is denied.

I. BACKGROUND

AllianceShippers, Inc. ("Plaintiff") is an intermodal freight transportation company headquartered in Englewood Cliffs, New Jersey. Midland West, Inc. ("Defendant") is a California corporation with a principal place of business in Montebello, California.Between 2005 and 2007, Plaintiff engaged Defendant to transport freight on behalf of Plaintiff's customers. Plaintiff alleges that with the exception of twelve shipments that form the basis of this case, Defendant paid all of Plaintiff's invoices to Plaintiff's corporate headquarters in New Jersey. Plaintiff alleges that it is owed $29, 410.20, an amount which Defendant disputes and claims was offset by overcharges and unpaid shipments.

In March, 2009 Plaintiff filed a complaint in the New Jersey Superior Court, Middlesex County, Docket No. MID-L-2642-09. Defendant moved to dismiss based on lack of personal jurisdiction. The motion was granted by the Superior Court by Order dated June 26, 2009. On Plaintiff's motion for reconsideration, the Superior Court issued an Order granting Plaintiff leave to obtain discovery on the issue of personal jurisdiction. Plaintiff's state court complaint was dismissed by Order, dated January 8, 2010. Although Plaintiff filed a notice of appeal, that appeal was withdrawn when the instant suit was filed in Federal court. The Federal case is entirely duplicative of the state court complaint.

II. LEGAL STANDARD

A. Fed. R. Civ. P. 12(b)(1) Rule 12(b)(1) provides for dismissal of an action based on lack of subject matter jurisdiction. See Fed.R.Civ.P. 12(b)(1). When the existence of subject matter jurisdiction is challenged under Rule 12(b)(1), the plaintiff bears the burden to show that the court has the requisite jurisdiction to hear the case. See, e.g., Hedges v. United States, 404 F.3d 744, 750 (3d Cir.2005); Mortensen v. First Federal Savings and Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977). In adjudicating such a Rule 12(b)(1) motion, the court may not presume that the plaintiff's allegations are true, but instead, must conduct an evaluation of the merits of the jurisdictional claims. See, e.g., Hedges, 404 F.3d at 750.

B. Fed. R. Civ. P. 12(b)(2)

Pursuant to Fed.R.Civ.P. 4(e), a district court may exercise jurisdiction over a non-resident defendant to the extent permitted by the law of the state where the district court sits. See Fed.R.Civ.P. 4(e). "A federal court sitting in New Jersey has jurisdiction over parties to the extent provided under New Jersey state law." Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 96 (3d Cir.2004). "New Jersey's long-arm statute provides for jurisdiction coextensive with the due process requirements of the United States Constitution." Id. (citing N.J. Ct. R. 4:4--4(c)). Pursuant to Fed.R.Civ.P. 12(b)(2), a plaintiff must demonstrate by a preponderance of the evidence facts sufficient to support the assertion of personal jurisdiction over a defendant. Ameripay, LLC v. Ameripay Payroll, Ltd., 334 F.Supp.2d 629, 632 (D.N.J.2004) (citing Carteret Savings Bank, FA v. Shushan, 954 F.2d 141, 146 (3d Cir.1992)). "A court must accept as true the allegations in the complaint and resolve disputed issues of fact in favor of the plaintiff[,]" for purposes of jurisdiction, plaintiff cannot rely on pleadings alone, but instead must provide actual proofs. Id. (citing Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 66 n. 9 (3d 1984)). "Once the plaintiff has shown minimum contacts, the burden shifts to the defendant, who must show that the assertion of jurisdiction would be unreasonable." Id. (citing Mellon Bank (East) PFSF, Nat'l Assoc. v. Farino, 960 F.2d 1217, 1221 (3d Cir.1992)). "Once challenged, a plaintiff bears the burden of establishing personal jurisdiction." Pro Sports Inc. v. West, 639 F.Supp.2d 475, 478 (D.N.J.2009) ( citing General Elec. Co. v. Deutz AG, 270 F.3d 144, 150 (3d Cir.2001) (finding the plaintiff must demonstrate "[a] nexus between defendant, the forum, and the litigation.")).

C. Fed. R. Civ. P. 12(b)(60 and res judicata

When a prior case has been adjudicated in state court, federal courts must give full faith and credit to the state court's judgment. 28 U.S.C. § 1738; Balthazar v. Atlantic City Med. Ctr., 279 F.Supp.2d 574, 584 (D.N.J.2003). The doctrine of res judicata embodies this principal and bars re-litigation of an issue that has already been determined on the merits by a court of competent jurisdiction. Balthazar at 585. In order for res judicata to apply, there must [1] be a valid, final judgment on the merits in the prior action, [2] the same parties in both actions, and [3] the claim in the second action must arise out of the same transaction as the claim in the first action. United States v. 5 Unlabled Boxes, 572 F.3d 169, 173 ...


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