United States District Court, E.D. Pennsylvania
THOMAS W. SHERIDAN and SHERIDAN AND MURRAY, LLC, Plaintiffs,
RANDELL C. ROBERTS and THE ROBERTS LAW FIRM, Defendants.
D. WOLSON, J.
a dispute between two law firms, one in Texas and one in
Pennsylvania, about a referral fee. In this Motion, the Texas
law firm and its principal argue that they are not subject to
personal jurisdiction in Pennsylvania. The Court concludes
that the law firm is subject to personal jurisdiction but the
individual defendant is not. Defendants also ask to transfer
this case to Texas, but the Court declines to do so.
Roberts is a partner at The Roberts Law Firm (the
“Roberts Firm”), a firm located in Tyler, Texas.
(ECF No. 7 ¶¶ 5, 6.) In 2013, James and Kay Burgess
(the “Clients”) hired the Roberts Firm to
represent them in connection with injuries that James Burgess
suffered while working on an oil rig in Pennsylvania. (ECF
No. 9-2 ¶ 31.) As part of that representation, the
Roberts Firm identified potential claims against Clark
Electric Contractors, which would have to be brought in
Pennsylvania. (Id. ¶ 35.)
Roberts met Thomas Sheridan at a seminar in California in
October 2013. (Id. ¶ 36.) During that seminar,
they discussed the Burgess's case. (Id. ¶
37.) In November 2013, Mr. Sheridan followed up with Mr.
Roberts about the Burgess's case via e-mail.
(Id. Ex. B.) Mr. Roberts then sent information about
the Clients' claims to Mr. Sheridan. (Id. ¶
41.) In September 2014, Mr. Sheridan and Mr. Roberts spoke by
phone and discussed a referral fee arrangement. Mr. Sheridan
sent a proposed referral fee agreement and engagement letters
for the Clients to engage Sheridan & Murray.
(Id. ¶¶ 42-46.) The Clients ultimately
executed Consents to Refer, which authorized the Roberts Firm
to refer their case to Sheridan & Murray. (Id.
¶ 49 & Ex. G.) However, it does not appear that any
of the Parties ever signed the referral fee agreement.
Parties now have a dispute about the terms of their referral
arrangement. Plaintiffs claim that the referral agreement
that Mr. Sheridan sent to Mr. Roberts in 2014 was inaccurate.
In 2018, Mr. Sheridan and Mr. Roberts spoke about the terms
of the referral agreement and allegedly clarified or altered
the terms of that arrangement. Mr. Sheridan sent a
confirmatory email to Mr. Roberts, which Mr. Roberts
acknowledged. (Id. ¶¶ 60-61 & Ex. H.)
However, Defendants dispute the validity of that
survive a motion to dismiss for lack of personal jurisdiction
under Federal Rule of Civil Procedure 12(b)(2), the plaintiff
bears the burden of establishing the court's personal
jurisdiction over the defendant. Miller Yacht Sales, Inc.
v. Smith, 384 F.3d 93, 97 (3d Cir. 2004). The
court's review of a motion to dismiss under Rule 12(b)(2)
is not limited to the pleadings, and the court may rely on
sworn affidavits submitted by the parties or other competent
evidence. O'Connor v. Sandy Land Hotel Co.,
Ltd., 396 F.3d 312, 316 (3d Cir. 2007). In the absence
of an evidentiary hearing, the plaintiff need only present a
prima facie case of personal jurisdiction, and the court must
take all of the plaintiff's factual allegations as true
and resolve all factual disputes in the plaintiff's
favor. See Eurofins Pharma U.S. Holdings v. BioAlliance
Pharma SA, 623 F.3d 147, 155 (3d Cir. 2010). The burden
then shifts to the defendant to establish that the exercise
of jurisdiction would be unreasonable. Carteret Sav. Bank
v. Shushan, 954 F.2d 141, 150 (3d Cir.1992).
the Due Process Clause of the Fourteenth Amendment, personal
jurisdiction over an out-of-state defendant requires that the
defendant have “minimum contacts” with the forum
state such that exercising jurisdiction would “not
offend traditional notions of fair play and substantial
justice.” Int'l Shoe Co. v. Washington,
326 U.S. 310, 319 (1945). Personal jurisdiction can arise
under two distinct theories: general jurisdiction and
specific jurisdiction. See Metcalfe v. Renaissance
Marine, Inc., 566 F.3d 324, 334 (3d Cir. 2009).
Plaintiffs do not contend that this Court has general
jurisdiction over Defendants, therefore the Court limits its
analysis to specific jurisdiction.
specific jurisdiction, the Third Circuit uses a three-part
test to determine “minimum contacts”: (1) a
nonresident defendant must “purposefully direct”
his activities at a resident of the forum, (2) the injury
arises from, or relates to, those activities, and (3) the
exercise of jurisdiction otherwise comports with fair play
and substantial justice. D'Jamoos ex rel. Estate of
Weinegroff v. Pilatus Aircraft Ltd., 566 F.3d 94, 102
(3d Cir. 2009). Questions of specific jurisdiction also
depend on the particular claims asserted. Gen. Elec. Co.
v. Deutz AG, 270 F.3d 144, 150 (3d Cir. 2001). In
contracts cases, a court must consider the “totality of
the circumstances” in evaluating minimum contacts,
including the agreement terms, the place and character of
prior negotiations, contract performance, contemplated future
consequences, and the resolution of post-contract
difficulties. See Remick v. Manfredy, 238 F.3d 248,
256 (3d Cir. 2001); Gen. Elec. Co., 270 F.3d at 150.
The Court Has Specific Jurisdiction Over The Roberts
totality of the circumstances supports this Court's
specific jurisdiction over the Roberts Firm. First,
the Roberts Firm purposefully directed its activities at
Sheridan & Murray. It communicated with Sheridan &
Murray prior to entering into the referral agreement and
after its formation. See Strick Corp. v. A. J. F.
Warehouse Distributors, Inc., 532 F.Supp. 951, 959 (E.D.
Pa. 1982) (to determine whether a non-resident
defendant's contracting with a resident involved
“purposeful” activity, “courts should look
to whether the non-resident defendant initiated the deal,
attempted to alter the terms of the contract, or conducted
significant negotiations with the plaintiff.”). Indeed,
those subsequent communications, and whether the e-mail
exchange in 2018 between Mr. Roberts and Mr. Sheridan
constitutes an enforceable agreement, is at the crux of this
case. Moreover, by referring the Clients to Sheridan &
Murray and entering into a referral agreement, the Roberts
Firm set in motion litigation in Pennsylvania from which the
Roberts Firm hoped to profit. See Jaffe v. Julien,
754 F.Supp. 49, 53 (E.D. Pa. 1991) (explaining that the
“essence” of a referral agreement is the
performance of legal services in the forum in which they are
Defendants' Motion, they minimize the significance of the
litigation in Pennsylvania by describing it as Sheridan &
Murray's “unilateral activity.” (ECF No. 9-1
at 7.) That argument minimizes the Roberts Firm's own
role, however. Sheridan & Murray did not act
unilaterally; it acted exactly as the Roberts Firm intended
when the Roberts Firm referred the case to Sheridan &
Murray. Defendants also argue that the mere fact that
Sheridan & Murray discharged its obligations in
Pennsylvania is not enough to subject them to personal
jurisdiction. (Id. at 7-8 and citing Picot v.
Weston, 780 F.3d 1206, 1213 (9th Cir. 2015)). Again,
that argument misses the point, however. The Roberts Firm was