xcentric ventures v. borodkin - response to mtd re jx

8/3/2019 Xcentric Ventures v. Borodkin - Response to MTD Re JX

http://slidepdf.com/reader/full/xcentric-ventures-v-borodkin-response-to-mtd-re-jx 1/16

RESPONSE TO MOTION TO DISMISS RE: PERSONAL JURISDICTION

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David S. Gingras, #021097Gingras Law Office, PLLC3941 E. Chandler Blvd., #106-243Phoenix, AZ 85048Tel.: (480) 668-3623Fax: (480) 248-3196

[email protected] Attorney for Plaintiff Xcentric Ventures, LLC

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

XCENTRIC VENTURES, LLC, anArizona limited liability company,

Plaintiff,

v.

LISA JEAN BORODKIN et al .,

Defendants.

Case No.: 11-CV-1426-GMS

PLAINTIFF’S RESPONSE TODEFENDANTS’ MOTION TODISMISS FOR LACK OF PERSONALJURISDICTION

Plaintiff XCENTRIC VENTURES, LLC (“Plaintiff” or “Xcentric”) respectfully

submits the following Response to Defendants’ RAYMOND MOBREZ, ILIANA

LLANERAS and ASIA ECONONOMIC INSTITUTE, LLC (“Defendants” or the

“Mobrez Defendants”) Motion to Dismiss for Lack of Personal Jurisdiction (Doc. #18).

I. INTRODUCTION

This is an action for malicious prosecution 1, with emphasis on the word malice.

As alleged in Xcentric’s Complaint, this case arises from Defendants’ failed attempt to

use perjury, lies, and fraud in an effort to defeat the law. These illegal efforts were

intentionally aimed at only one state (Arizona), caused severe harm in only one state

(Arizona), and they are sufficient to establish personal jurisdiction here.

1 As explained in prior pleadings ( see Doc. #13), the Arizona Revised Jury Instructions (4 th ed.)(Intentional Torts—Instruction 19) use the term “Malicious Prosecution” to refer to claims basedon the wrongful misuse of either civil or criminal proceedings, while the Restatement (Second)of Torts § 674 calls the tort “Wrongful Use of Civil Proceedings”. For purposes of consistency,Xcentric will use the term “malicious prosecution” here.

Case 2:11-cv-01426-GMS Document 26 Filed 10/12/11 of 16



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After Whitney’s Florida lawsuit ended, Xcentric filed a new action against

Whitney and Whitney’s counsel in Arizona state court for malicious prosecution which

was eventually removed to this court. See Magedson v. Whitney Info. Network , Case No.

09-CV-1715-DGC (D.Ariz.). Exactly as the Mobrez Defendants have done here,Whitney and its counsel moved to dismiss claiming that by suing Xcentric in Florida,

Whitney had not engaged in sufficient contacts with Arizona to permit the exercise of

personal jurisdiction here. As in this case, the Whitney defendants also moved to dismiss

for improper venue and/or inconvenient forum.

The Arizona district court rejected these arguments and denied Whitney’s

motions. In doing so, the court found that personal jurisdiction in Arizona could be based

solely on the unlawful commencement and continuation of groundless litigation in

another forum which had the intended effect of harming Xcentric in Arizona. See

Magedson v. Whitney Information Network, Inc. , 2009 WL 113477 (D.Ariz. 2009)

(denying defendant’s Motion to Dismiss and Motion to Transfer Venue).

To be fair, Judge Campbell’s decision in Whitney is not binding on the Mobrez

Defendants, nor is this Court obligated to follow it. See In re Silverman , 616 F.3d 1001,

1005 (9th

Cir. 2010) (noting, ““[t]he doctrine of stare decisis does not compel one districtcourt judge to follow the decision of another.””) (quoting Starbuck v. City and County of

San Francisco , 556 F.2d 450, 457 n. 13 (9 th Cir. 1977)). Of course, this does not mean

the Whitney case is of no importance.

Rather, Whitney involved identical arguments, identical points of law, virtually

identical facts, and at least one identical party. As such, while it may be non-binding, it

is highly instructive here. See Hart v. Massanari , 266 F.3d 1155, 1169 (9 th Cir. 2001)

(explaining, “When ruling on a novel issue of law, [federal courts] will generally

consider how other courts have ruled on the same issue. This consideration will not be

limited to courts at the same or higher level, or even to courts within the same system of

sovereignty.”) Ultimately, whether this Court gives Whitney much weight or no weight

at all, the law plainly requires the denial of the Mobrez Defendants’ motion.




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II. ARGUMENT

The motion before the court is narrow and the issues are not complex. Xcentric

does not allege that the Mobrez Defendants are generally subject to personal jurisdiction

in Arizona, so the only issue for determination is whether they are subject to specific jurisdiction here.

This Court is surely familiar with the “effects doctrine” of Calder v. Jones and the

Ninth Circuit’s interpretation of these legal standards, so this response will not belabor

these points of law. Defendants’ motion argues that Xcentric has failed to satisfy the

three-prong standard for specific jurisdiction: “(1) has the defendant purposefully

directed tortious activities at the forum or a resident thereof or performed some act by

which he purposefully availed himself of the privileges of conducting activities in the

forum, (2) do the claims arise out of or result from the defendant's forum-related

activities, and (3) is the exercise of jurisdiction reasonable?” Bancroft & Masters, Inc. v.

Augusta Nat'l Inc ., 223 F.3d 1082, 1087 (9 th Cir.2000) (citing Panavision Int'l, L.P. v.

Toeppen , 141 F.3d 1316, 1321 (9 th Cir. 1998)). Naturally, Xcentric asserts it has met

these standards, and its position on each point is set forth below.

a. Defendants Intentionally Targeted Arizona

Relying primarily on a case from outside the Ninth Circuit— Wallace v. Herron

778 F.2d 391 (7 th Cir. 1985)—the Mobrez Defendants argue that their contacts with

Arizona were “too attenuated” to support jurisdiction here. Of course, the defendants in

Whitney also cited Wallace for the same premise, and this argument was rejected as

inconsistent with Ninth Circuit precedent. See Whitney , 2009 WL 113477, *2 n. 2

(specifically rejecting defendants’ reliance on Wallace v. Herron and explaining, “While

the Court is inclined to agree with Wallace's treatment of Calder , the Court is bound by

Ninth Circuit law. ‘[C]ases from this circuit bear out the conclusion that ‘express aiming’

encompasses wrongful conduct individually targeting a known forum resident .”)

(emphasis in original) (quoting Bancroft , 223 F.3d at 1087). Because it conflicts with

Ninth Circuit authority such as Bancroft , Wallace does not help Defendants’ position.




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Not only does Bancroft remain good law on this point, several years after the case

was decided the Ninth Circuit substantially expanded Bancroft by holding that not only

will “intentional targeting” of a local resident support local jurisdiction regardless of

where the wrongful conduct occurred, the same is true even if the “brunt” of the harmwas caused outside the local forum; “We take this opportunity to clarify our law and to

state that the ‘brunt’ of the harm need not be suffered in the forum state. If a

jurisdictionally sufficient amount of harm is suffered in the forum state, it does not matter

that even more harm might have been suffered in another state.” Yahoo! Inc. v. La Ligue

Contre Le Racisme Et L’Antisemitisme , 433 F.3d 1199, 1207 (9 th Cir. 2006) (emphasis

added) (finding that by sending demand letters to Yahoo! in California, serving Yahoo!

with process in California, and commencing litigation against Yahoo! in France in an

effort to change Yahoo!’s business practices , French defendant had engaged in sufficient

contacts with California to permit the exercise of personal jurisdiction in California).

As explained in the Affidavit of Xcentric’s manager, Edward Magedson,

submitted herewith, Xcentric alleges that the wrongful conduct of the Mobrez Defendants

caused Xcentric to needlessly incur nearly $100,000 in attorney’s fees and costs. See

Affidavit of Edward Magedson (“Mageson Aff.”) ¶ 7. This amount (which does notinclude other damages that Xcentric suffered such as fees paid to other attorneys in

California) was paid from Xcentric’s bank account in Arizona to Xcentric’s counsel

Jaburg & Wilk in Arizona who appeared pro hac vice in the California proceeding. See

Magedson Aff. ¶ 8. In addition to other damages, including punitive damages, these

costs and fees are recoverable here. See Restatement (Second) of Torts § 681 (1977)

(noting, “When the essential elements of a cause of action for wrongful civil proceedings

have been established, the plaintiff is entitled to recover for … (c) the expense that he has

reasonably incurred defending himself against the proceedings … .”)

Standing alone, this demonstrates that “a jurisdictionally sufficient amount of

harm is suffered in the forum state,” Yahoo! , supra . Nothing more is necessary to satisfy

the first prong of the specific jurisdiction test.




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In an effort to minimize their wrongful conduct and de-emphasize their contacts

with Arizona, the Mobrez Defendants incorrectly argue that “The only contacts that

Plaintiff pleads in its Complaint are attributed to Mobrez—seven telephone calls—

contacts that are far too attenuated to satisfy due process.” Mot. at 5:15–17. Thisargument is both factually incorrect and legally irrelevant.

First, as a matter of law and as the district court held in Whitney , jurisdiction does

not require that a defendant engage in any particular conduct in Arizona ; rather,

“purposeful availment is satisfied even by a defendant ‘whose only “contact” with the

forum state is the “purposeful direction” of a foreign act having effect in the forum

state’.” Whitney , 2009 WL 113477, *2 (quoting Dole Food Co. v. Watts , 303 F.3d 1104,

1111 (9 th Cir. 2002)). Further, the Whitney court specifically agreed that the “purposeful

direction or availment” standard is satisfied where the Complaint alleges that the

Defendants engaged in wrongful conduct entirely outside of Arizona (i.e., the groundless

Florida litigation) which was targeted at Xcentric whom the Whitney defendants knew

was based in Arizona. See Whitney , 2009 WL 113477, *2.

This is exactly the case here. In their motion, the Mobrez Defendants never deny

knowing that Xcentric was an Arizona LLC when they commenced the underlying actionin California. This is not surprising given that the caption of the Complaint from that

action (attached as Exhibit A to Xcentric’s Complaint in this matter; Doc. #1) clearly

reflected Defendants’ knowledge that Xcentric was an Arizona limited liability company.

Caption from Original Complaint (Doc. #1, Ex. A)




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As the Whitney court concluded, nothing further is necessary to satisfy Calder’s

“purposeful direction or availment” prong—the fact that the Mobrez Defendants engaged

in wrongful conduct outside of Arizona is sufficient to expose them to personal

jurisdiction here as long as their conduct was purposely directed at Arizona and causedharm here which, of course, it did. See Whitney , 2009 WL 113477, *2. These are

precisely the facts alleged in Xcentric’s Complaint. See Doc. #1, ¶ 9 (alleging,

“Defendants’ actions were specifically intended to cause harm to Plaintiff within the

State of Arizona and, in fact, Defendants’ actions had the intended effect of actually

causing substantial harm to Plaintiff within the State of Arizona. Defendants, and each of

them, are therefore properly subject to personal jurisdiction within the State of Arizona.”)

Furthermore, even if jurisdiction could only be based on a defendant’s contacts

with a forum (as opposed to non-forum activities which caused harm here), Arizona

courts have previously held that a single telephone call made to an Arizona resident,

coupled with other unlawful conduct causing harm here, can be sufficient to establish

personal jurisdiction in Arizona. See Bils v. Nixon, Hargrave, Devans & Doyle , 179

Ariz. 523, 526, 880 P.2d 743, 746 (App. 1994) (finding that where New York law firm

allegedly obtained the credit report of an Arizona resident in violation of the Fair CreditReporting Act and made single telephone call to Arizona seeking information about the

plaintiff, personal jurisdiction was proper “[b]ecause the alleged conduct of [defendants]

was intentionally directed at an Arizona resident and was calculated to cause injury to

him here, their contacts were sufficient to confer personal jurisdiction.”)

b. Forum Related Activities

“The second requirement for specific jurisdiction is that the contacts constituting

purposeful availment must be the ones that give rise to the current suit.” Bancroft , 223

F.3d at 1088. In Whitney , the district court determined that this prong was “easily

satisfied” by Xcentric’s allegation that “but for” the defendants’ unlawful commencement

of litigation in Florida which caused harm in Arizona, Xcentric would not have sued

Whitney in Arizona. See Whitney , 2009 WL 113477, *3 (citing Bancroft ).




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Apparently misunderstanding this point, on pages 7–8 of their motion the Mobrez

Defendants suggest that the second prong of the specific jurisdiction analysis requires a

showing that “Plaintiff’s claims … arise out of Defendants’ particular activities in the

forum state .” Mot. at 7:13–14 (double emphasis in original) (citing Bancroft , 223 F.3dat 1087). This argument is simply incorrect as a matter of law. In fact, this is a direct

misstatement of the holding in Bancroft which actually stands for the exact opposite

premise.

In other words, as explained above, the first prong (“purposeful availment”) is

satisfied by showing that the defendant engaged in “wrongful conduct individually

targeting a known forum resident ” regardless of where the wrongful conduct actually

occurred. Here, as in Whitney , the Mobrez defendants engaged in wrongful conduct

outside Arizona that was individually targeted at a known Arizona victim (Xcentric) and

which caused substantial harm in Arizona. But for those actions, this case would never

have been brought. A fortiori , as the district court held in Whitney , the second prong of

specific jurisdiction is satisfied because “the contacts constituting purposeful availment

must be the ones that give rise to the current suit.” Bancroft , 223 F.3d at 1088. Here, the

contacts constituting purposeful availment are the ones that give rise to the current suit.As such, the second prong of specific jurisdiction is met.

c. Reasonableness

Because the first and second prongs of specific jurisdiction have been met, “the

burden shifts to the defendant to ‘present a compelling case that the presence of some

other considerations would render jurisdiction unreasonable.’” Whitney , 2009 WL

113477, *3 (quoting Burger King Corp. v. Rudzewicz , 471 U.S. 462, 477, 105 S.Ct. 2174,

85 L.Ed.2d 528 (1985)) (citing Ballard v. Savage , 65 F.3d 1495, 1500 (9 th Cir. 1995)

(characterizing this as a “heavy burden of rebutting the strong presumption in favor of

jurisdiction”). Of course, the issue of reasonableness requires a review of the seven

factors identified in Burger King and discussed in pages 8–11 of Defendants’ motion.

Xcentric offers the following brief comments on each point.




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i. Extent of Purposeful Interjection Into Arizona

Defendants argue that by suing Xcentric in California, their interjection into

Arizona was “ de minimus ”. Xcentric strongly disagrees.

At its core, the underlying California litigation was commenced by the MobrezDefendants because, among other things, they wanted Xcentric to remove material from

its website and to also make sweeping changes to the way that Xcentric conducts

business in Arizona. See Magedson Aff. ¶¶ 11–15. If they had prevailed in that quest,

this would have necessarily had an immediate and dramatic impact on Xcentric’s

operations in Arizona, potentially making it impossible for Xcentric to remain in

business. See Magedson Aff. ¶ 15. By attempting to illegally force Xcentric to change

the way it operates in Arizona or to close its doors permanently, the Mobrez Defendants

interjected themselves into Arizona in a very meaningful way.

Furthermore, during the course of the underlying California litigation, the Mobrez

Defendants and their counsel attempted to unlawfully induce an employee of Xcentric to

steal confidential business records from Xcentric in Arizona and transport those records

to them in California. See Magedson Aff. ¶ 17. Although this effort was ultimately

unsuccessful, it underscores the substantial and deliberate efforts the Mobrez Defendantstook to reach into Arizona and to attempt to cause harm to Xcentric in Arizona. As such,

this factor should weigh strongly in favor of Xcentric. See Yahoo!, Inc. v. La Ligue

Contre Le Racisme Et L’Antisemitisme , 145 F.Supp.2d 1168, 1177 (N.D.Cal. 2001)

(finding that where French entity sent demand letters to Yahoo! in California, served

Yahoo! with process in California, and then commenced litigation in France in an effort

to change Yahoo! practices, the “purposeful injection” factor weighed in favor of

jurisdiction in California), aff’d , 433 F.3d 1199 (9 th Cir. 2006).

In all candor, the Whitney court determined the “purposeful injection” factor was

neutral in that case. See Whitney , 2009 WL 113477, *3. However, as noted above, the

facts of Whitney were much less egregious than the facts of this case. As such, Whitney

is distinguishable on this point.




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ii. Burden of Litigating in Arizona

Implying poverty, the Mobrez Defendants suggest that litigating this action in

Arizona would be a “heavy burden” and that because Xcentric has survived costly

litigation in the past, it would be fair to force it to incur even more expense by litigatingthis action in California (which it already spent 18 months doing during the preceding

action). This argument should be summarily rejected because the Mobrez Defendants

offer no evidence to establish their financial position so there is no basis to conclude that

they are financially unable to litigate in Arizona.

In addition, a significant procedural difference between the Arizona and California

courts actually shows that the burden of litigating this action in Arizona would be far

lower for both parties than it would be in California. Specifically, under the local rules

of the Central District of California, every motion (regardless of how trivial or minor) is

required to be set for hearing on the assigned judge’s general “law and motion” day

(meaning a cattle call date when all matters on the calendar are scheduled for the same

time). Counsel for both sides are required to personally attend each hearing unless

excused. See Central District Local Rule L.R. 7–4 and L.R. 7–14. 2 The local rules of the

California state court system are essentially the same.In the original California lawsuit filed against Xcentric, because of the extreme

efforts that the Mobrez Defendants took to avoid a merits-based disposition and to

prolong the action, this resulted in numerous motions and hearings on various dates

including April 13, April 19, June 24, June 28, July 12, September 20, and November 1,

2010. Xcentric’s Arizona-based counsel was required to attend each hearing, typically

resulting in an entire day of traveling to/from Los Angeles and waiting sometimes hours

for the case to be called, even if the actual hearing lasted only five minutes.

As this Court is aware, the Arizona District Court does not require every motion to

be set for hearing. On the contrary, hearings on motions (particularly simple/routine

matters) are only rarely required. By this fact alone, it is likely that other than the trial of

2 See http://www.cacd.uscourts.gov/CACD/LocRules.nsf




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this matter itself (which would be burdensome to all parties regardless of where it

occurs), litigating this case in Arizona would result in a substantial savings of time and

costs for all parties as compared with litigating the case in California. Under these

circumstances, and given the ease with which pleadings and motions may be filed via theCourts’s ECF/PACER system, Arizona is plainly the most efficient and least burdensome

forum in which this case could be heard. This factor strongly favors Xcentric.

iii. Extent of Conflict with California Sovereignty

For reasons that continue to baffle undersigned counsel, the Mobrez Defendants

argue that Xcentric’s Complaint in this action “depends heavily” upon a series of

recorded telephone conversations which Defendants suggest were created in violation of

California law. This is baffling because not only is the argument directly inconsistent

with the facts, the same argument was specifically raised before and specifically rejected

by the California court. Despite this, the Mobrez Defendants continue to ignore reality

by pretending that the court somehow ruled in their favor on this point when, in fact, it

specifically ruled against them on this point.

Because this is such a tangential and collateral issue, it is not necessary to discuss

the details in exhaustive detail here. Rather, it suffices to say that as alleged in paragraph26 of Xcentric’s Complaint and as explained in the California court’s ruling on

Xcentric’s first Motion for Summary Judgment, 2010 WL 4977054, *9–11, Mr. Mobrez

made a total of seven phone calls to Xcentric’s main telephone number in Arizona in

April and May 2009. Two of these calls were simply voicemail messages that Mr.

Mobrez left for Mr. Magedson. Of the remaining five calls, four were automatically

recorded by Xcentric’s telephone system without Mr. Mobrez’s knowledge. Of the four

remaining calls that were recorded, Mr. Mobrez’s wife (Ms. Llaneras) was secretly

listening to three of them without the knowledge of Mr. Magedson. As alleged in the

Complaint here, these recordings demonstrate that both Mr. Mobrez and Ms. Llaneras

committed perjury in the prior litigation because they both gave materially false

testimony regarding the contents of these telephone conversions.




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Because the recordings were so devastating to their claims, the Mobrez

Defendants vigorously tried to suppress them in the prior case, arguing that they were

inadmissible under California’s “wiretapping” statute, Cal. Pen. Code § 632. Far from

accepting this argument as Defendants now imply, the district court specifically rejectedit, finding that recordings were admissible under federal law regardless of whether they

were made in violation of California state law:

The Omnibus Crime Control and Safe Streets Act (“the Act”) is the federallaw that regulates the interception of oral communications. 18 U.S.C. §§2510 et. seq . Section 2511(2)(d) provides that the interception of wire, oral,or electronic communications shall not be unlawful where the interceptionis done by a party to the conversation or where one of the parties to the

conversation has given prior consent to such interception, unless thecommunication is intercepted for the purpose of committing any criminal or tortuous act. 18 U.S.C. § 2511(2)(d). In the present case, DefendantsXcentric and Magedson clearly gave prior consent to the third party vendor to record all telephone calls coming into the main Ripoff Report telephonenumber. Further, there is no evidence, nor any suggestion, that the purposeof the recordings was to perpetrate a criminal or tortuous act. AlthoughPlaintiffs allege that Defendants used the phone to communicateextortionate threats to Plaintiffs, even if that were true, there is nosuggestion that the recordings were used for the purpose of extortion. To

the contrary, Defendants have presented evidence that all calls to the Ripoff Report's main telephone number were recorded in the ordinary course of business. Therefore, the recordings at issue do not violate federal law.

In sum, because the recordings at issue comply with federal law, they may be admitted as evidence without regard to California Penal Code § 632.

2010 WL 4977054, *11–12 (emphasis added). Of course, after concluding that the

recordings were not unlawful and were otherwise admissible, the district court excluded

them solely because Xcentric declined to disclose the identity of the third-party vendor

who created them. See 2010 WL 4977054, *13. This point (which ultimately was

irrelevant to the disposition of the action) does not mean that the recordings are

inadmissible in this case. Rather, the only reason Xcentric declined to disclose the

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to a protective order which would have prevented them from disclosing the identity of

this vendor to any of Xcentric’s detractors and critics. As this court may recall based on

prior matters such as Xcentric Ventures, LLC v. William Stanley, et al. , Case No. 07-CV-

0954-GMS, Xcentric has an unfortunately long history of being targeted by unlawfulattacks, including harassment campaigns directed at third party vendors who provide

services to Xcentric. See Xcentric Ventures, LLC v. William Stanley, et al. , 2009 WL

113563 (D.Ariz. 2009) (finding defendant in contempt for violating a preliminary

injunction which precluded defendant from harassing Xcentric’s third party vendors).

Given how clearly unlawful the conduct of the Mobrez Defendants was in the

prior proceeding, Xcentric determined that it would not and could not disclose the name

of the third party vendor without an appropriate protective order in place. Of course,

upon the entry of such an order in this case , Xcentric could certainly identify the vendor

who, in turn, could authenticate the recorded telephone call and thereby resolve the

concerns which precluded their admission in the previous action.

All these points aside, even if California’s wiretapping law was relevant here,

which it is not, California law does not favor Defendants’ position in any way. This is so

because the California courts have expressly held that even when a tape recordingviolates Penal Code § 632, it may always be used for impeachment. See Frio v. Superior

Court , 203 Cal.App.3d 1480, 1497, 250 Cal.Rptr. 819, 828 (2 nd Dist. 1988) (explaining,

“the party asserting the [exclusionary] sanction [of Cal. Pen. Code § 632] should not be

permitted to use it as a shield for perjury.”)

Thus, regardless of the fact that Arizona is a one-party state and that the

recordings were clearly lawful under Arizona law, even if this court were to somehow

apply California law, the recordings would be entirely admissible (assuming sufficient

authentication). Thus, litigating this case in Arizona would not conflict in any way with

the sovereignty of California. On the contrary, because perjury is a crime under Arizona,

California, and federal law, all of these jurisdictions have a strong interest favoring the

punishment of this type of behavior.




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iv. Arizona’s Interest In Adjudicating Dispute

Defendants argue that because most of their unlawful conduct happened in

California, Arizona has no interest in this dispute. This position is baseless; “Arizona has

a strong interest in ensuring that its residents are compensated for their injuries.”Whitney , 2009 WL 113477, *4 (citing Gates Learjet Corp. v. Jensen , 743 F.2d 1325,

1333 (9 th Cir. 1984)). This factor favors Xcentric.

v. Most Efficient Judicial Resolution

In Whitney , the court found this factor was neutral because witnesses and evidence

were located in both Arizona and Florida. Whitney , 2009 WL 113477, *4. Here,

Xcentric agrees the factor is neutral for the same reason; evidence and witnesses 3 are

located in both Arizona and California.

vi. Importance Of Litigating In Arizona

While correctly noting that this factor is generally entitled to little weight,

Defendants argue that this factor favors them. Xcentric could dispute this point, but

given how strongly the other factors support jurisdiction here, it is unnecessary to do so.

vii. Existence of an Alternative Forum

Xcentric agrees that an alternative forum exists in California.viii. Summary

In Whitney , the district court concluded that in light of all the factors, the

defendants failed to make a “compelling case” that it would be unreasonable to require

them to litigate in Arizona. See Whitney , 2009 WL 113477, *4. The same is true here.

Further, the Whitney court observed “on the issue of reasonableness … Defendants

intentionally required [Xcentric] to litigate the first lawsuit in Florida. The Florida

Defendants cannot now argue persuasively that it is unreasonable for them to be required

to litigate the second lawsuit in Arizona.” Id . Again, the same is true here.

3 Defendants suggest that Mr. Magedson “is likely a resident of California”. Mot. at10:24. Mr. Magedson is a citizen and resident of Arizona, and only Arizona. SeeMagedson Aff. ¶ 16.




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As one final note on the issue of reasonableness and foreseeability, it is worth

mentioning that the Mobrez Defendants were warned that their unlawful actions in

California would result in the commencement of litigation against them in Arizona.

Specifically, attached to Xcentric’s Complaint in this matter as Exhibit E is a copy of aletter dated May 11, 2010 that was sent to Defendants, through their counsel, a few days

after the deposition of Mr. Mobrez in which the recorded telephone calls were revealed.

This letter could not be any clearer—it plainly stated: “Assuming the present federal case

in Los Angeles is resolved in favor of Xcentric, a new lawsuit will immediately be filed

against your clients in Arizona seeking to recover all damages caused by their illegal

conduct.” Of course, this warning was ignored by the Mobrez Defendants and they

continued prosecuting their sham proceeding even more aggressively than before. Thus,

as promised, immediately after the California action was resolved in Xcentric’s favor,

this case was filed here in Arizona.

Under these circumstances, the commencement of this action in this forum could

not have come as any surprise. To the contrary, because they were expressly warned that

their unlawful conduct would result in Xcentric suing them in Arizona, the Mobrez

Defendants surely could “reasonably anticipate being haled into court there” to answer for their actions. World-Wide Volkswagen Corp. v. Woodson , 444 U.S. 286, 297, 100

S.Ct. 559, 567, 62 L.Ed.2d 490 (1980). The fact that Defendants ignored this warning

and Xcentric kept its promise does not offend traditional notions of fair play and

substantial justice.

III. CONCLUSION

For the reasons stated herein, the Mobrez Defendants’ Motion to Dismiss for lack

of personal jurisdiction should be denied.

DATED October 12, 2011.

GINGRAS LAW OFFICE, PLLC/S/ David S. GingrasDavid S. GingrasAttorneys for Plaintiff




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CERTIFICATE OF SERVICE

I hereby certify that on October 12, 2011 I electronically transmitted the attached

document to the Clerk’s Office using the CM/ECF System for filing, and for transmittalof a Notice of Electronic Filing to the following:

Hartwell Harris, Esq.LAW OFFICE OF HARTWELL HARRIS

1809 Idaho AvenueSanta Monica, CA 90403Attorney for Defendants

Raymond MobrezIliana Llaneras and

Asia Economic Institute, LLC

John S. Craiger, Esq.David E. Funkhouser III, Esq.

Krystal M. Aspey, Esq.Quarles & Brady LLP

One Renaissance SquareTwo North Central Avenue

Phoenix, Arizona 85004-2391Attorney for Defendant Lisa J. Borodkin

And a courtesy copy of the foregoing delivered to:HONORABLE G. MURRAY SNOW

United States District CourtSandra Day O’Connor U.S. Courthouse, Suite 622

401 West Washington Street, SPC 80Phoenix, AZ 85003-215

/s/David S. Gingras


xcentric ventures v. borodkin - response to mtd re jx

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