Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MDT PERSONNEL, LLC v. FRANK MONGELLUZZI and ANNE MONGELLUZZI

November 30, 2010

MDT PERSONNEL, LLC, PLAINTIFF,
v.
FRANK MONGELLUZZI AND ANNE MONGELLUZZI,
DEFENDANTS.



The opinion of the court was delivered by: Schiller, J.

MEMORANDUM

Plaintiff MDT Personnel brings this action against Defendants Frank and Anne Mongelluzzi, asserting claims of breach of contract and tortious interference. Presently before the Court is Defendants' motion to dismiss for lack of personal jurisdiction. On November 23, 2010, the Court heard oral argument on this motion. The Court finds that Defendants are subject to personal jurisdiction in Pennsylvania for the reasons discussed below.

I. BACKGROUND

A. The Asset Purchase Agreement and Related Contracts

This case arises from the Mongelluzzis' sale of several temporary staffing companies to MDT Personnel ("MDT") in September, 2010. At the heart of this dispute is an Amended and Restated Asset Purchase Agreement dated September 2, 2010 ("APA"), which purports to transfer substantially all "property, assets and rights owned, licensed, or held for use" by eight corporate entities. (Compl. Ex. A. [APA] 4.) These are identified in Schedule I of the APA as follows:

(1) Able Body Temporary Services, Inc., a Florida corporation; (2) Able Body Gulf Coast, Inc., f/k/a YJNK IX, Inc., a Florida corporation; (3) Professional Staffing-A.B.T.S., Inc., a Florida corporation; (4) Westward Ho, LLC, a Florida limited liability company; (5)Westward Ho II, LLC, a Florida limited liability company; (6) YJNK III, Inc., d/b/a TCD Electrical Helpers, a Florida corporation; (7) YJNK XI CA LLC, a Florida limited liability company; and (8) Rotrpick, LLC, a Florida limited liability company (collectively, "Seller Companies").

Michael Traina executed the APA on behalf of MDT. (APA S1.) As noted in the APA, MDT is a Pennsylvania limited liability company. (Id. at 1.) Traina, the sole member of MDT, is a Pennsylvania resident. (See Pl.'s Mot. for TRO and Prelim. Inj. Ex. B. [Pl.'s Verified Adversary Compl.] ¶ 3.) The APA requires that the parties send all notices directed to MDT to the company's address in Doylestown, Pennsylvania. (APA § 10.8.) The APA does not contain a forum selection clause. However, the APA provides that it "shall be governed and construed in accordance with the domestic laws of the Commonwealth of Pennsylvania." (Id. at § 10.9.)

Anne and Frank Mongelluzzi executed the APA individually for the purpose of Sections 7.6(b), 7.8 and Article IX. These provisions relate to the transfer of the Seller Companies' assets and documents, a covenant not to compete with the Seller Companies for three years following the closing date, and remedies, respectively. (Id. at 20-21, 23-25.) The Mongelluzzis otherwise executed the APA on behalf of the Seller Companies. (Id. at S2-S3.)

The Mongelluzzis also signed a Transition Services Agreement ("TSA") and Consulting Agreements on September 2, 2010. (Compl. Exs. B, C, D.) The TSA requires the Seller Companies to make their employees available exclusively to MDT and prohibited them from discouraging employees from remaining with the MDT-owned businesses. (Compl. Ex. D. [TSA] Art. IX.) The TSA includes a choice of law clause designating Pennsylvania law as controlling and a choice of forum clause by which the parties consented to the exclusive jurisdiction of the state and federal courts of Pennsylvania. (Id. at §§ 14.3, 14.11.) The Mongelluzzis did not execute the TSA in their individual capacities, but signed on behalf of the Seller Companies. (Id. at S2-S4.)

The consulting agreements were signed by Frank and Anne Mongelluzzi in their individual capacities. (Compl. Exs. B [Frank's Consulting Agreement], C [Anne's Consulting Agreement].) These agreements contain forum selection clauses directing that any "dispute, controversy or claim arising out of or relating to the construction or interpretation of [the Consulting Agreements] shall be conducted in the state courts of the Commonwealth of Pennsylvania." (Frank's Consulting Agreement at §9(c); Anne's Consulting Agreement at §9(c).)

Article X of the APA contains an integration clause which provides that the APA and its attached schedules and exhibits, including documents referenced in the APA, "constitute the entire understanding among the Parties," superseding prior understandings or agreements. (APA 26.) The APA refers to both the Transition Services Agreement and the Consulting Agreements. (Id. at 4, 9.)

B. The Dispute Between MDT and the Mongelluzzis

MDT alleges that the Mongelluzzis received $40 million in exchange for the Seller Companies and the option to purchase an additional company. (Compl. ¶¶ 1, 11.) According to MDT, the Mongelluzzis immediately breached their obligations under the APA, TSA and Consulting Agreements by frustrating MDT's efforts to operate the businesses. Specifically, MDT claims the Mongelluzzis locked MDT out of facilities it operated in Florida and Louisiana, improperly filed for bankruptcy in the District of New Jersey in an attempt to unwind the sale, solicited MDT's customers and employees, and failed to provide consulting services. (See id. at ¶¶ 16-19.)

MDT commenced an adversary proceeding in the U.S. Bankruptcy Court for the District of New Jersey, where Frank Mongelluzzi had filed Chapter 11 petitions on behalf of himself and his company, ABTS Holdings LLC. On October 13, 2010, the Bankruptcy Judge granted MDT's motion for a temporary restraining order enjoining Frank Mongelluzzi and his associates from interfering with MDT's possession of the Seller Companies. (Pl.'s Mot. for TRO and Prelim. Inj. Ex. D.) He also dismissed the bankruptcy action sua sponte on October 21, 2010, leaving the TRO in effect through October 28, 2010. (Id. Ex. F.) MDT filed this action on October 27, 2010. This Court has extended the TRO by stipulation of the parties.

C. The Mongelluzzis' Contacts With Pennsylvania

The Mongelluzzis filed a motion to dismiss for lack of personal jurisdiction on November 11, 2010. In their motion, the Mongelluzzis assert that they "are Florida residents with no personal or professional relationship to Pennsylvania." (Defs.' Mot. to Dismiss for Lack of Personal Jurisdiction [Mot. to Dismiss] 2.) The Mongelluzzis attached signed affidavits in which they assert that they have no business interests in Pennsylvania. (Mot. to Dismiss Ex. 1 [Frank Aff.] ¶ 10 ("I have no business interests in Pennsylvania."); Mot. to Dismiss Ex. 2 [Anne Aff.] ¶ 3 ("I have not conducted any business in Pennsylvania.").) The Mongelluzzis also deny having ever been ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.