United States District Court, D. Utah
CHG COMPANIES, INC. d/b/a COMPHEALTH, a Delaware corporation, Plaintiffs,
MEDINA MEMORIAL HOSPITAL, a New York corporation Defendants.
MEMORANDUM DECISION AND ORDER
Benson United States District Judge
the court is Defendant Medina Memorial Hospital's
(“Medina”) Motion to Dismiss for lack of personal
jurisdiction claims brought by Plaintiff CHG Companies, Inc.
(“CHG”). (Dkt. No. 12). At oral argument on the
motion, CHG was represented by Michael C. Barnhill, and
Medina was represented by Wesley D. Felix. At the conclusion
of the hearing, the Court took the matter under advisement.
Now, having considered the law and facts relating to the
motion, the Court renders the following Memorandum Decision
CHG is a Delaware corporation registered to do business in
Utah with its headquarters in Salt Lake City, Utah. (Compl.
at ¶ 1; decl. of Steve Riding at ¶¶ 3-4). From
its office in Salt Lake City, CHG provides locum
tenens services to hospitals and clinics
throughout the country. Id. Defendant Medina is a
New York corporation with its principal place of business in
Medina, New York. (Compl. at ¶ 2). Medina does not have
a physical presence in Utah, is not registered to do business
in Utah, and does not pay any taxes in Utah (Decl. of Wendy
Jacobson at ¶¶ 9-14).
unclear from the record which party initially contacted the
other, but in 2016 CHG and Medina began negotiating over a
locum tenens agreement in which CHG would arrange
for a physician to work temporarily at Medina's hospital
in New York. (Decl. of Steve Riding at ¶¶ 6-10).
Throughout the negotiations, Medina and CHG exchanged emails
and phone calls. (Decl. of Wendy Jacobson at ¶ 7).
However, no one from Medina traveled to Utah as part of the
negotiation process. (Id. at ¶ 5).
parties entered into a written agreement on July 27, 2016.
(Agreement). CHG screened potential candidates, and Medina
approved Dr. Ian Cole, who began performing services for
Medina in New York in August, 2016 and ceased in November,
2016 when Medina terminated its relationship with CHG.
(Compl. at ¶¶ 6-13). CHG alleges that throughout
this time period it sent bi-weekly invoices to Medina based
upon Dr. Cole's submitted work records, and that Medina
has failed to pay the full amount of the invoices.
Id. The contract contains a Utah choice of law
provision. (Agreement at ¶ 8.E).
obtain personal jurisdiction over a nonresident defendant in
a diversity action, a plaintiff must show (1) that
jurisdiction is legitimate under the laws of the forum state,
and (2) that the exercise of jurisdiction does not offend the
due process clause of the Fourteenth Amendment. Soma
Medical Int'l v. Standard Chartered Bank, 196 F.3d
1292, 1295 (10th Cir. 1999).
Jurisdiction Under State Law
law expressly states that the Utah state long arm statute
must be interpreted broadly “so as to assert
jurisdiction over nonresident defendants to the fullest
extent permitted by the due process clause of the Fourteenth
Amendment to the United States Constitution.” Utah Code
§ 78B-3-201; see also Starways, Inc. v. Curry,
980 F.2d 204, 206 (Utah 1999) (“We have held that the
Utah long-arm statute ‘must be extended to the fullest
extent allowed by due process of law.”) (quoting
Synergetics v. Marathon Ranching Co., 701 F.2d 1106,
1110 (Utah 1985)). Because the Utah long-arm statute confers
the maximum jurisdiction permissible consistent with the Due
Process Clause, the court proceeds to determine whether the
exercise of personal jurisdiction over Medina in the instant
case meets federal due process standards.
Due Process Analysis
Due Process Clause protects an individual's liberty
interest in not being subject to the binding judgments of a
forum with which he has established no meaningful
‘contacts, ties, or relations.'” Burger
King, 471 U.S. at 471-72 (quoting International Shoe
Co. v. Washington, 326 U.S. 310, 319 (1945)).
Accordingly, a “court may exercise personal
jurisdiction over a nonresident defendant only so long as
there exist ‘minimum contacts' between the
defendant and the forum state.” World Wide
Volkswagen Corp. v. Woodson, 444 U.S. 286, 291 (1980)
(quoting International Shoe, 326 U.S. at 316).
order to establish specific personal
jurisdiction, the court must determine whether the
defendant has such “minimum contacts” with the
forum state “that he should reasonably anticipate being
haled into court there.” World-Wide
Volkswagen, 444 U.S. at 297. These “minimum
contacts” are established “‘if the
defendant has “purposefully directed” his
activities at residents of the forum and the litigation
results from alleged injuries that “arise out of or
relate to” those activities.'” OMI
Holdings, 149 F.3d at 1091 (quoting Burger
King, 471 U.S. at 472). Second, if the defendant's
activities create sufficient minimum contacts, then the court
must consider “whether the exercise of personal
jurisdiction over the defendant offends ‘traditional
notions of fair play and substantial justice.'”
Id. (quoting Asahi Metal Indus. Co. v. Superior
Court of California, 480 U.S. 102, 113 (1987)). The
latter inquiry requires a determination of whether a district
court's exercise of personal jurisdiction over a
defendant with minimum contacts is “reasonable”
in light of the circumstances surrounding the case. OMI
Holdings, 149 F.3d at 1091.
examining the contacts with the forum state, the
“relationship must arise out of contacts that the
defendant himself creates with the forum
State.” Walden v. Fiore, 134 S.Ct. 1115, 1122
(2014) (internal quotation omitted) (emphasis in original).
The United States Supreme Court has “consistently
rejected attempts to satisfy the defendant-focused
‘minimum contacts' inquiry by demonstrating
contacts between the plaintiff (or third party) and the forum
State.” Id. The analysis “looks to the
defendant's contacts with the forum State itself, not the
defendant's contacts with persons who reside
there.” Id. To be sure, the existence of a
contract between the defendant and a party of the forum state
establishes some contacts with the forum, but “[i]f the
question is whether an individual's contract with an
out-of-state party alone can automatically establish
sufficient minimum contacts in the other party's home
forum . . . the answer is clearly is that it cannot.”
Burger King, 471 U.S. at 472. Jurisdiction can only
be found if the out-of-state party “purposefully
reach[es] out beyond their State and into another by, for
example, entering a contractual relationship that envisioned
continuing and wide-reaching contacts in the forum
State.” Walden, 134 S.Ct. at 1122 ...