The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF ARKANSAS
FAYETTEVILLE DIVISION
BRITTON ESPOSITO; CHRISTIAN FRESNO;
BENJAMIN KUTYLO; ALLYSON ESPOSITO;
and ALLYSON ESPOSITO, as mother and
next friend of JANIE DOE, a minor PLAINTIFFS
V. CASE NO. 5:20-CV-5204
AIRBNB ACTION, LLC; AIRBNB PAYMENTS,
INC.; AIRBNB, INC.; PUERTO PANAL FARM
CLUB PROPERTY ASSOCIATION AND
ASSOCIATION BOARD; MATIAS JOSE
FERNANDEZ; LINDSAY OLSON; and OTHER
OWNER(S) AND/OR AIRBNB HOSTS OF FARM
HOUSE CHAKRA 82, BUENOS AIRES, ARGENTINA DEFENDANTS
MEMORANDUM OPINION AND ORDER
Before the Court is a Motion to Dismiss and Memorandum of Law in Support (Docs.
71 & 75) filed by Defendants Puerto Panal Farm Club Property Association and
Association Board, Matias Jose Fernandez, and Lindsay Olson (collectively, “Argentine
Defendants”). Plaintiffs filed a Response in Opposition (Doc. 81), and Argentine
Defendants filed a Reply (Doc. 84). Because the Court concludes that it does not have
personal jurisdiction over any of the Argentine Defendants, the Motion to Dismiss (Doc.
71) is GRANTED.
I. BACKGROUND
Plaintiffs Allyson Esposito, her husband Benjamin Kutylo, and their minor daughter
are residents of Benton County, Arkansas. Plaintiffs Britton Esposito and Christian
Fresno are residents of Argentina. In November 2019, Allyson was in Arkansas when
she used the Airbnb platform to make a reservation for two nights on behalf of herself and
the other Plaintiffs at a property outside of Buenos Aires, Argentina referred to as the
Farm House. The Farm House is located in the Puerto Panal neighborhood, a gated
community with security guards overseen by Defendant Puerto Panal Farm Club Property
Association and Association Board (“the Association”), which describes itself as a
homeowners’ association. Defendants Matias Jose Fernandez and Lindsay Olson own
the Farm House, and Lindsay offers it for rent on the Airbnb platform. Lindsay is an
American citizen, but she and Matias are both residents of Argentina. On the night of
November 21, 2019, shortly after arriving at the Farm House, Plaintiffs were assaulted
and robbed by four masked men. Plaintiffs allege that the masked men were notified of
their presence in the neighborhood and permitted access by the security guards. Once
the assailants left the house, Plaintiffs were able to contact the police, who eventually
arrived to investigate. The security guards were subsequently arrested. Plaintiffs sought
medical attention at hospitals in Buenos Aires, and then Allyson, Benjamin, and their
minor daughter returned to Arkansas. Britton and Christian remained in Argentina, where
they reside.
Plaintiffs initially filed suit in the District Court for the Northern District of Illinois,
making claims against Airbnb and Argentine Defendants. That court transferred the case
to the Western District of Arkansas. This Court then granted a motion to compel
arbitration as to the claims against the Airbnb Defendants. See Doc. 78. The remaining
claims against the Argentine Defendants are for negligence, negligent hiring/retention,
vicarious liability, violation of right of privacy, and deceptive advertising in violation of the
federal Lanham Act, 15 U.S.C. § 1125.
Argentine Defendants now move to dismiss Plaintiffs’ claims against them for lack
of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure.
In the alternative, Argentine Defendants seek dismissal for insufficient service of process
and forum non conveniens or to stay proceedings while Plaintiffs’ claims against Airbnb
proceed in arbitration. In response, Plaintiffs argue that the Court may exercise specific
personal jurisdiction over Lindsay because she intentionally entered into a contract—the
rental agreement—with Allyson in Arkansas and because “Plaintiffs’ lives have been and
will continue to be impacted every single day in Arkansas” by the trauma they experienced
in Argentina. (Doc. 81, p. 7). Plaintiffs offer no basis for the Court to exercise personal
jurisdiction over Matias or the Association. Since the Court agrees with Argentine
Defendants that it does not have personal jurisdiction over any of them, it does not
address their other arguments.
II. LEGAL STANDARD
A plaintiff must state enough facts in a complaint to support a reasonable inference
that the defendant is subject to the jurisdiction of the forum. “When personal jurisdiction
is challenged by a defendant, the plaintiff bears the burden to show that jurisdiction
exists.” Fastpath, Inc. v. Arbela Tech. Corp., 760 F.3d 816, 820 (8th Cir. 2014). “[T]he
plaintiff’s prima facie showing must be tested, not by the pleadings alone, but by the
affidavits and exhibits presented with the motions and in opposition thereto.” Dever v.
Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir. 2004) (internal quotation marks
omitted). When the defendant is not a resident of the forum state, the district court may
only exercise jurisdiction if “personal jurisdiction exists under the forum state’s long-arm
statute and . . . the exercise of personal jurisdiction is consistent with due process.” Wells
Dairy, Inc. v. Food Movers Int’l, Inc., 607 F.3d 515, 518 (8th Cir. 2010). Under Arkansas’s
long-arm statute, “the exercise of personal jurisdiction is limited only by federal
constitutional law.” Yanmar Co., Ltd. v. Slater, 386 S.W.3d 439, 443 (Ark. 2012).
Constitutional due process requires that a non-resident defendant “have ‘minimum
contacts with the forum state such that the maintenance of the suit does not offend
traditional notions of fair play and substantial justice.’” Pangaea v. Flying Burrito, 647
F.3d 741, 745 (8th Cir. 2011) (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945)). “Sufficient minimum contacts requires some act by which the defendant
‘purposely avails itself of the privilege of conducting activities within the forum State, thus
invoking the benefits and protections of its laws.’” Fastpath, 760 F.3d at 821 (quoting J.
McIntyre Machinery, Ltd. v. Nicastro, 564 U.S. 873, 880 (2011). The nature of the
contacts between the defendant and the forum must be purposeful and “must not arise
due to mere fortuity.” Pangaea, 647 F.3d at 745. “Sufficient contacts exist when the
defendant’s conduct and connection with the forum State are such that [the defendant]
should reasonably anticipate being haled into court there.” Soo Line R.R. Co. v. Hawker
Siddeley Can., Inc., 950 F.2d 526, 528 (8th Cir. 1991) (internal quotation marks omitted).
III. DISCUSSION
First, Plaintiffs make no argument for this Court’s personal jurisdiction as to Matias
or the Association, nor does the Court find that either Matias or the Association has any
contacts with Arkansas. Matias submitted an affidavit attesting that while he co-owns the
Farm House with his wife, Lindsay, he does not “operate, manage, or control the listing”
of the Farm House on Airbnb, “participate or engage in the listing” on Airbnb, or operate
an account on any other platform to rent the Farm House. (Doc. 75-2, ¶¶ 2, 11–13). On
the Airbnb listing, Lindsay is the only host. See Doc. 72-2, p. 8. A legal representative
of the Association also submitted an affidavit attesting that the Association “conducts its
operations and renders its services solely in the Zarate Province of Buenos Aires.” (Doc.
75-3, ¶ 4). The affidavit asserts that the Association has no form of contact with Arkansas.
Since Plaintiffs offer no facts to meet their burden of establishing that Matias or the
Association has any contacts with Arkansas, the Court concludes that it does not have
personal jurisdiction over either Matias or the Association.
As to Lindsay, Plaintiffs argue that the contract between Allyson and Lindsay
coupled with the harm that Allyson, Benjamin, and their daughter continued to suffer when
they returned to Arkansas are sufficient to establish minimum contacts with this forum.
Plaintiffs offer two legal bases for this argument. First, Plaintiffs assert that the Calder
effects test from Calder v. Jones, 465 U.S. 783 (1984), supports a finding of minimum
contacts. Second, Plaintiffs argue that the approach to assessing the adequacy of
internet contacts laid out in Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F. Supp.
1119 (W.D. Pa. 1997), also establishes that Lindsay has minimum contacts with
Arkansas. The Court disagrees. Neither of these standards for assessing minimum
contacts allows the Court to exercise personal jurisdiction over Lindsay.
A. Calder Effects Test
A plaintiff who has suffered an intentional tort can establish specific personal
jurisdiction as to the tortfeasor by showing that the defendant’s acts “(1) were intentional,
(2) were uniquely or expressly aimed at the forum state, and (3) caused harm, the brunt
of which was suffered—and which the defendant knew was likely to be suffered—in the
forum state.” Johnson v. Arden, 614 F.3d 785, 796 (8th Cir. 2010) (modification adopted).
This is known as the Calder effects test. In Walden v. Fiore, the Supreme Court clarified
that “[t]he proper focus of the minimum contacts inquiry in intentional-tort cases is the
relationship among the defendant, the forum, and the litigation. And it is the defendant,
not the plaintiff or third parties, who must create contacts with the forum State.” 571 U.S.
277, 291 (2014) (internal citation and quotation marks omitted). In other words, the same
principles of due process relevant to personal jurisdiction generally also undergird the
Calder effects test analysis. “A forum State's exercise of jurisdiction over an out-of-state
intentional tortfeasor must be based on intentional conduct by the defendant that creates
the necessary contacts with the forum.” Id. at 286. “[T]he plaintiff cannot be the only link
between the defendant and the forum. Rather, it is the defendant's conduct that must form
the necessary connection with the forum State that is the basis for its jurisdiction over
him.” Id. at 285.
Lindsay’s intentional conduct, Plaintiffs allege, is entering into a contract with
Allyson for the rental of the Farm House while Allyson was in Arkansas. However, the
Eighth Circuit has held that a “contract between a plaintiff and an out-of-state defendant
is not sufficient in and of itself to establish personal jurisdiction over the defendant in the
plaintiff's forum state.” Fastpath, 760 F.3d at 821. “Instead courts should consider the
terms of the contract and its contemplated future consequences in determining whether
personal jurisdiction over a non-resident defendant exists.” Id. Here, while Allyson was
in Arkansas when she entered into a rental agreement for the Farm House, the contract
was for services that would be provided only in Argentina—that is, the stay at the
residence—and the agreement was narrow in scope, providing for a two-night stay at the
Farm House. There was no further connection between Arkansas and the performance
of the contract. In fact, as discussed further below, Lindsay did not even know that Allyson
was an Arkansas resident when the parties entered into the rental agreement.
To their credit, Plaintiffs recognize that the fact of the contract alone is not a
sufficient basis for personal jurisdiction. See Doc. 81, p. 6. They argue, however, that
the additional fact that Allyson, Benjamin, and their daughter continue to experience the
effects of their trauma in Arkansas, when combined with the fact that Allyson entered into
the rental agreement while in Arkansas, creates adequate minimum contacts as to
Lindsay. The facts of Walden are instructive for understanding why this argument is
unpersuasive.
In Walden, the plaintiffs were residents of Nevada who had money seized from
them by an agent of the Drug Enforcement Agency while passing through the airport in
Atlanta, Georgia. During an interview with the agent, the plaintiffs identified themselves
as being residents of Nevada. The Ninth Circuit held that the district court in Nevada had
personal jurisdiction over the agent for claims that he provided a false affidavit in seeking
the forfeiture of the funds seized. The court applied the Calder effects test and concluded
that the agent “expressly aimed” his submission of the allegedly false affidavit at Nevada
because he knew it would result in “foreseeable harm” to residents of Nevada. See
Walden, 571 U.S. at 282.
The Supreme Court reversed, holding that the fact that the plaintiffs suffered from
the agent’s actions while in Nevada could not provide a basis for personal jurisdiction.
Instead, the Supreme Court emphasized, “The proper question is not where the plaintiff
experienced a particular injury or effect but whether the defendant's conduct connects
him to the forum in a meaningful way.” Id. at 290. The plaintiffs “lacked access to their
funds in Nevada not because anything independently occurred there, but because
Nevada is where respondents chose to be at a time when they desired to use the funds
seized by petitioner.” Id. The Court pointed out that the plaintiffs “would have
experienced this same lack of access in California, Mississippi, or wherever else they
might have traveled and found themselves wanting more money than they had.” Id.
Here, as in Walden, Allyson, Benjamin, and their daughter suffered harm in
Arkansas because of their unilateral choice to return to Arkansas and not because of any
aspect of Lindsay’s conduct. Thus, under Walden, the Court cannot conclude that
Lindsay has engaged in affirmative conduct to give her minimum contacts with Arkansas.
B. Zippo Internet Contacts
Courts in the Eighth Circuit have found the test laid out in Zippo Manufacturing Co.
v. Zippo Dot Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997), instructive when considering
the sufficiency of contacts over the internet. See Johnson, 614 F.3d at 796. In Zippo,
the court “created a ‘sliding scale’ to measure the likelihood of personal jurisdiction [that]
runs from active contract formation and repeated transmission of computer files to mere
posting of information on a website.” Id. Because the Airbnb platform permits direct
contact between hosts and potential guests and allows them to finalize their rental
agreements through the Airbnb website, the Court recognizes that the contacts fall on the
more “active” end of the spectrum. However, where the interaction fell on the sliding scale
of interactivity was not the end of the court’s inquiry. As discussed below, the Zippo court
also considered the intentionality and volume of the defendant’s contacts and where the
alleged harm occurred. Plaintiffs’ reliance on Zippo is therefore misplaced.
Zippo dealt with a trademark dispute between a manufacturer and a website with
the same name. The website, which the court referred to as “Dot Com,” provided a
subscription-based news service with both free and paid subscriptions available. Zippo
Mfg., 952 F. Supp. at 1122. The district court denied Dot Com’s motion to dismiss for
lack of personal jurisdiction. The court held that Dot Com’s contacts with Pennsylvania
were intentional and not fortuitous because the Dot Com processed applications for paid
subscriptions for Pennsylvania residents and made agreements with Internet providers in
Pennsylvania so that their Pennsylvania subscribers could access the news service. Id.
at 1126. Those contacts were also sufficiently substantial because approximately three
thousand of Dot Com’s subscribers were residents of Pennsylvania. Id. at 1127. Finally,
the court noted that the cause of action arose out of Dot Com’s contract to provide news
service messages to Pennsylvania residents: “When these messages are transmitted into
Pennsylvania and viewed by Pennsylvania residents on their computers, there can be no
question that the alleged [trademark] infringement and dilution occur in Pennsylvania.”
Id.
Here, in contrast, Plaintiffs have not provided any evidence that Lindsay knew she
had entered into a contract with an Arkansas resident when Allyson made a reservation
at the Farm House. In fact, Allyson’s profile on Airbnb indicated that she resides in Boston
and lists a phone number with a Chicago area code. See Doc. 72-3. Lindsay also asserts
that Allyson “is my first and only customer from the State of Arkansas.” (Doc. 75-1, ¶ 13).
Unlike in Zippo, there is no evidence that would allow this Court to conclude that Lindsay
intentionally targeted residents of Arkansas in advertising the Farm House or even that
she knowingly provided a service to a resident of Arkansas in renting to Allyson.
Furthermore, unlike the trademark infringement and dilution, which occurred in
Pennsylvania when the messages were transmitted there, Lindsay’s allegedly tortious
conduct occurred in Argentina when inadequate security was provided at the Farm
House, not in Arkansas.
Another district court considered very similar facts in Labollita v. Home Rental
Connections Ltd., 2017 WL 2569522 (D. Mass. June 13, 2017), and reached the same
conclusion. The plaintiffs were Massachusetts residents who used an internet platform
to secure a vacation rental in Paris, France. When the plaintiffs arrived at the rental in
Paris, one of them was injured in a fall on the rental’s stairs. They sued both the French
owner of the apartment and the London-based company with whom the owner contracted
to advertise the apartment and coordinate with guests, referred to as HRC. In considering
the plaintiffs’ contract and breach of warranty claims, the court found that HRC’s contacts
with Massachusetts were insufficient to support personal jurisdiction, noting,
The parties never contemplated and the contract did not provide for
performance of any services by [HRC] in Massachusetts. Rather, the parties
always intended all of HRC's performance to occur in France. The contract
was short, obligating HRC to provide Plaintiffs the apartment for seven
days, the communication between the parties was limited to signing the
contract and clarifying the details of Plaintiffs’ stay. Additionally, HRC did
not target either Plaintiffs or Massachusetts.
Id. at *5 (emphasis in original). As to the plaintiffs’ negligence claims, the court observed
that “[t]hese claims have no relationship to Massachusetts beyond the fact the Plaintiffs
are from Massachusetts and made the reservation from Massachusetts.” Id. at *6. The
court concluded that “[t]his is clearly insufficient to allow this Court to exercise jurisdiction
as Plaintiffs have not shown that Defendants purposefully availed themselves of the
protections of the laws of Massachusetts.” Id.
Ultimately, the law is clear that due process “requires that a defendant be haled
into court in a forum State based on his own affiliation with the State, not based on the
‘random, fortuitous, or attenuated’ contacts he makes by interacting with other persons
affiliated with the State.” Walden, 571 U.S. at 286 (quoting Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 475 (1985)). Here, Plaintiffs have not met their burden to show
that any of the Argentine Defendants has more than a coincidental and tenuous
connection to Arkansas, which is insufficient to establish personal jurisdiction.
IV. CONCLUSION
In summary, Argentine Defendants’ Motion to Dismiss (Doc. 71) is GRANTED.
The claims against Defendants Matias Jose Fernandez, Lindsay Olson, and Puerto Panal
Farm Club Property Association and Association Board (Counts I-IV, VII—-X, XIII-XVI,
XIX—XXIl, XXV—XXVIII and Counts XXXII and XXXIll as to those Defendants) are
DISMISSED for lack of personal jurisdiction. The claims previously compelled to
arbitration remain stayed. The Clerk of Court is directed to ADMINISTRATIVELY
TERMINATE the case while arbitration is pending. The remaining parties may move to
reopen the case when arbitration has been completed. The case management hearing
set for February 8, 2021, at 10:30 a.m. is also TERMINATED.
IT IS SO ORDERED on this 5" day of February, 202
UNITED STATES DISTRICT JUDGE
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