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Cohen, Seglias, Greenhall, Pallas, & Furman, P.C. v. Hessert Construction -- Pa

February 4, 2011


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


Plaintiff Cohen, Seglias, Greenhall, Pallas & Furman, P.C. ("Cohen Seglias") filed suit in Pennsylvania state court against Defendants Hessert Construction -- PA, LLC ("Hessert -- PA"), Hessert Construction -- NJ, LLC ("Hessert -- NJ"), Hessert Corporation, and William Hessert ("Hessert") (collectively, "Defendants") to collect unpaid legal fees. (Am. Compl., ECF No. 1, Ex. A.) Defendants removed the matter to this Court on the basis of diversity jurisdiction. (ECF No. 1.)

Presently before the Court is Defendants' Motion to Dismiss (Mot. to Dismiss, ECF No. 3.) Defendants seek dismissal because the Court lacks personal jurisdiction over them; Cohen Seglias's claims for unjust enrichment and quantum meruit are precluded by New Jersey law;*fn1 Hessert -- PA was fraudulently joined; and Hessert Construction Group is a non-existent entity.

(Mot. to Dismiss at 1-2, 16.) For the following reasons, Defendants' Motion will be denied.

I. Factual and Procedural Background

According to the Amended Complaint and Cohen Seglias's Answer to Defendants' Motion, the underlying facts are as follows. Defendants, all New Jersey residents, retained Cohen Seglias, to provide legal services. (Am. Compl. ¶¶ 2-5, 7.) Cohen Seglias is based in Philadelphia, Pennsylvania, but has offices in other parts of Pennsylvania, West Virginia, and New Jersey. (Answer to Mot., ECF No. 6, at 2.)

In May or June 1999, Hessert contacted Cohen Seglias to discuss retaining the firm in various construction matters. (Answer to Mot. at 2.) Hessert then traveled to Cohen Seglias's Philadelphia office for further discussions and ultimately retained the firm. (Id.) Defendants agreed to pay Cohen Seglias for services rendered and costs advanced on Defendants' behalf. (Am. Compl. ¶ 7; Answer to Mot. at 2.) Cohen Seglias alleges that the parties' agreement was memorialized in a letter, but the firm has not yet located an executed copy of the agreement. (Am. Compl. ¶ 7.)

Cohen Seglias alleges that between the summer of 1999 and the spring of 2010, the firm represented Defendants in twenty-nine (29) matters. (Answer to Mot. at 2.) Over the course of the relationship, Cohen Seglias billed Defendants almost $700,000, and Defendants remitted more than $586,000 in payment. (Answer to Mot. at 2-3.) Cohen Seglias issued each invoice from its Philadelphia office, each invoice required payment be made to Philadelphia, and Defendants remitted each payment from New Jersey to Pennsylvania. (Id.)

In addition, throughout the representation, the firm placed phone calls and mailed correspondence from its Philadelphia office to Defendants in New Jersey. (Am. Compl. ¶ 9.)

Defendants, in turn, placed phone calls and sent correspondence to the firm from New Jersey, and some personnel attended meetings at Cohen Seglias's Philadelphia office. (Answer to Mot. at 3.) The unpaid invoices concern legal services rendered in several New Jersey lawsuits for the period November 2009 through April 2010, including one case in which the plaintiff named all Defendants. (Id. at 4.) For each of these matters, Cohen Seglias performed much of the work -- including negotiations, legal research, and drafting of pleadings -- in Philadelphia. (Am. Compl. ¶ 10; Answer to Mot. at 3-4.)

Despite repeated requests for payment of the unpaid invoices, Defendants did not pay. (Am. Compl. ¶ 14.) On October 25, 2010, Cohen Seglias filed the pending Amended Complaint in the Philadelphia Court of Common Pleas. Cohen Seglias asserts three theories for recovery: breach of contract, unjust enrichment, and quantum meruit. (Id. ¶¶ 15-25.)

On November 10, 2010, Defendants removed the matter to this Court on the basis of diversity jurisdiction. (ECF No. 1.) On December 3, 2010, Defendants filed the pending Motion to Dismiss. After having been granted an extension of time, Cohen Seglias timely responded. Each party filed a supporting affidavit, which will be discussed in more detail below.

II. Jurisdiction and Legal Standards

A. Jurisdiction and Venue

The Court has subject matter jurisdiction over this removed matter pursuant to 28 U.S.C. § 1332.*fn2 Venue is proper pursuant to 28 U.S.C. § 1441(a).

B. Legal Standards

On a motion to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2), a court is required to accept plaintiff's allegations as true and must construe disputed facts in plaintiff's favor. Metcalfe v. Renaissance Marine, Inc., 566 F.3d 324, 330 (3d Cir. 2009). Once a defendant raises a jurisdictional defense, the plaintiff bears the burden of proving by affidavits or other competent evidence that jurisdiction is proper. Id. If the court does not hold an evidentiary hearing, as in this case,*fn3 the plaintiff need only establish a prima facie case of personal jurisdiction. Id; see also 4 Wright & Miller, Federal Practice and Procedure § 1067.6, at 558-59 (3d ed. 2002) (noting prima facie case will be sufficient even if parties produce competing affidavits). The plaintiff meets this burden by stating the bases for personal jurisdiction with reasonable particularity. See Mellon Bank East (PSFS), Nat'l Ass'n v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992). If the plaintiff establishes its prima facie case, the burden shifts to the defendant to demonstrate that the exercise of personal jurisdiction is unreasonable. See O'Connor v. Sandy Lane Hotel Co., 496 F.3d 312, 324 (3d Cir. 2007).

Defendants also assert that Cohen Seglias's claims for unjust enrichment and quantum meruit, and its claims against Hessert Construction Group, should be dismissed for failure to state a cause of action. Defendants do not attack the sufficiency of the pleadings; rather they attack the viability of the claims. In deciding a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the court must accept as true all well-pleaded factual allegations and must construe them in the light most favorable to the non-moving party. Phillips v. County of Allegheny, 515 F.3d 224, 228 (3d Cir. 2008). The complaint survives a motion to dismiss if it contains sufficient allegations of the material elements necessary to state a plausible claim to relief. In re Ins. Brokerage Antitrust Litig., 618 F.3d 300, 319 (3d Cir. 2010).

III. Discussion

A. The Court has Personal Jurisdiction over Defendants

1. Parties' Contentions

Defendants contend that the Court lacks general or specific personal jurisdiction over them. With regard to general jurisdiction, Defendants assert that none of the parties are Pennsylvania companies or citizens and that they do not conduct continuous or systematic business in Pennsylvania. (Mot. to Dismiss at 9-10.) As for specific jurisdiction, Defendants argue that its alleged contacts with Pennsylvania are not sufficient. (Id. at 10-13.) In particular, they contend that limited telephone contact and obligations to make payments into Pennsylvania do not establish the requisite minimum contacts. Further, Cohen Seglias's performance of services in Pennsylvania is unilateral activity that cannot establish Defendants' contacts with the ...

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