The opinion
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
3:19-cv-542
REMI HOLDINGS, LLC, )
)
Plaintiff, )
)
vs. ) ORDER
)
WILLIAM THOMAS NEATHAMER, )
III, ET AL., )
)
Defendants. )
___________________________________ )
THIS MATTER comes before the Court on a Motion to Dismiss for Lack of
Jurisdiction, filed by Defendant Melissa Hughes. (Doc. No. 6).
I. BACKGROUND
Plaintiff Remi Holdings, LLC filed this action in Mecklenburg County, North Carolina,
on September 18, 2019, against William Thomas Neathamer, III, Brian Gibbs, Melissa Hughes,
and Thomas and Associates, LLC (“T & A”). T & A is located in Tennessee, and all of the
individual Defendants reside in Tennessee. Defendant Neathamer was at all relevant times T &
A’s owner and president, and Defendant Gibbs was at all relevant times a member of T & A.
The movant Defendant Melissa Hughes was a part-time employee of T & A at all relevant times.
She no longer works at T & A.
Plaintiff alleges that Defendant T & A entered into an agreement with Plaintiff in which
Defendant agreed to market and sell Plaintiff’s equipment maintenance services on Plaintiff’s
behalf. Plaintiff alleges that Defendants thereafter breached this agreement by, essentially,
joining with National Imaging Resources (“NIR”) to create a competitor to Plaintiff and use
Plaintiff as an unauthorized underwriter to this competitor. Plaintiff alleges that Defendants
convinced Plaintiff to enter into an agreement with NIR with the fraudulent purpose of deceiving
Plaintiff into providing Defendants with access to Plaintiff’s vendors and confidential and
proprietary trade secrets. Plaintiff brings claims against all Defendants for misappropriation of
trade secrets, tortious interference with contract, tortious interference with prospective economic
advantage, civil conspiracy, and unfair and deceptive trade practices.
On October 4, 2019, Plaintiff filed an Amended Complaint, changing Plaintiff’s name
from The Remi Group, LLC to Remi Holdings, LLC. See (Doc. No. 1–2 at p. 46: First Amended
Compl.). On October 17, 2019, Defendants removed this action to this Court. Defendant
Hughes filed the pending motion to dismiss on November 22, 2019, arguing that this Court lacks
personal jurisdiction over her because she does not have sufficient contacts with North Carolina
to be haled into court here. On February 12, 2020, the Court stayed the motion to dismiss to
allow the parties to conduct limited jurisdictional discovery. (Doc. No. 24). Following the entry
of that Order, the parties exchanged written discovery, Plaintiff deposed Hughes, and Hughes
deposed Plaintiff’s owner Brent Howison. The parties have completed jurisdictional discovery,
and they have submitted supplemental memoranda. (Doc. Nos. 29, 30).
II. STANDARD OF REVIEW
Under Rule 12(b)(1), the defendant may file a motion to dismiss based on a lack of
subject matter jurisdiction. FED. R. CIV. P. 12(b)(1). Where a defendant files such motion, the
plaintiff bears the burden to prove that subject matter jurisdiction exists. Adams v. Bain, 697
F.2d 1213, 1219 (4th Cir. 1982). Additionally, a motion to dismiss for lack of subject matter
jurisdiction may be brought on the grounds that the complaint fails to allege sufficient facts to
invoke the court’s jurisdiction and, when made on those grounds, all the facts asserted in the
complaint are presumed to be true. Id. Plaintiff bears the burden of establishing the existence of
the jurisdiction by a preponderance of the evidence. See New Wellington Fin. Corp. v. Flagship
Resort Dev. Corp., 416 F.3d 290, 294 (4th Cir. 2005).
III. DISCUSSION
Defendant Hughes, a Tennessee resident and former part-time employee of Defendant T
& A, argues that this Court does not have personal jurisdiction over her and she should therefore
be dismissed from this action. The exercise of personal jurisdiction over a nonresident defendant
is proper when (1) there is a basis for jurisdiction under North Carolina’s long-arm statute, and
(2) the exercise of personal jurisdiction complies with due process. Pan-American Prods. &
Holdings, LLC v. R.T.G. Furniture Corp., 825 F. Supp. 2d 664, 677 (M.D.N.C. 2011). Courts
construe North Carolina’s long-arm statute to be coextensive with due process, such that the two-
part test collapses into the single inquiry of “whether the non-resident defendant has such
‘minimum contacts’ with the forum state that exercising jurisdiction over it does not offend
‘traditional notions of fair play and substantial justice.”’ Id. (quoting Christian Sci. Bd. of Dirs.
of the First Church of Christ, Scientist v. Nolan, 259 F.3d 209, 215 (4th Cir. 2001)). In other
words, there must be “some act by which the defendant purposefully avails itself of the privilege
of conducting activities within the forum State, thus invoking the benefits and protections of its
laws.” Hanson v. Denckla, 357 U.S. 235, 253 (1958).
Personal jurisdiction may be exercised specifically or generally. Here, Plaintiff does not
contend that this Court can exercise general personal jurisdiction against Hughes, and the parties
appear to agree that Hughes’ activities in North Carolina have not been continuous and
systematic such that the court may exercise general personal jurisdiction over her. As detailed in
her sworn affidavit, Hughes owns no property in North Carolina, does not operate a business in
North Carolina, has no agent in North Carolina, and has no bank accounts in North Carolina; she
lives and works exclusively in Tennessee; and her only contact with North Carolina is that she
was born in North Carolina and sometimes visits family in North Carolina. These attenuated
contacts are insufficient to render Hughes “essentially at home” in North Carolina for purposes
of general personal jurisdiction. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 563
U.S. 914, 919 (citing Int’l Shoe Co. v. Wash., 326 U.S. 310, 317 (1945)).
The Court next addresses whether it may assert specific jurisdiction over Hughes. In
determining whether specific jurisdiction exists, courts consider (1) the extent to which the
defendant has purposefully availed itself of the privilege of conducting activities in the state; (2)
whether the plaintiff's claims arise out of those activities directed at the state; and (3) whether the
exercise of personal jurisdiction would be constitutionally reasonable. ALS Scan, Inc. v. Digital
Serv. Consultants, Inc., 293 F.3d 707, 711–12 (4th Cir. 2002) (internal quotations omitted). To
establish specific jurisdiction, the plaintiff must show “a sufficient nexus between [the]
defendants’ contact with the forum state and the nature of the claims asserted.” WLD, LLC v.
Watkins, 454 F. Supp. 2d 426, 432 (M.D.N.C. 2006). A defendant has purposefully availed
herself of the privilege of conducting business in the forum state “[i]f the defendant has created a
‘substantial connection’ to the forum.” Ellicott Mach. Corp. v. John Holland Party Ltd., 995
F.2d 474, 477 (4th Cir. 1993)). The purposeful availment requirement “ensures that a defendant
will not be haled into a jurisdiction solely as a result of ‘random,’ ‘fortuitous,’ or ‘attenuated’
contacts.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985).
Here, Plaintiff makes numerous allegations in the Amended Complaint about Defendant
Hughes in order to support the exercise of jurisdiction over her. In response, however, Hughes
has filed a sworn affidavit rebutting Plaintiff’s factual allegations that could support the exercise
of personal jurisdiction over Hughes in a North Carolina court. (Hughes Aff., Doc. No. 6-2 at ¶¶
10–12). Specifically, Hughes states that she has been a resident of Tennessee for the past three
years and for her entire employment with T & A. (Id. at ¶¶ 3, 14). Hughes’ only contacts with
North Carolina are purely personal, as she was born in North Carolina and travels to North
Carolina at times to visit family. (Id. at ¶ 8). She does not own property in North Carolina, does
not operate a business in North Carolina, and does not have a bank account in North Carolina.
(Id. at ¶¶ 4, 5, 6, 7, 8). Furthermore, despite Plaintiff’s allegations to the contrary, Hughes states
that she has never been a member, officer, or owner of T & A.1 (Id. at ¶ 9). She worked as a
part-time assistant at T & A from early 2018 until July 31, 2019, for $12 per hour, and her duties
included paying bills, running errands, and conducting administrative matters such as booking
flights and travel arrangements. (Id. at ¶¶ 10, 13). Her duties with T & A have never involved
sales, she has never been a sales assistant, and she has never traveled to North Carolina for
reasons related to her part-time employment with T & A. (Id. at ¶ 8, 11).
Hughes further states that, other than strictly administrative matters, she has never had
any communications with any officer or employee of Plaintiff. (Id. at ¶ 15). Hughes can only
recall two conversations with any Plaintiff’s employees. (Id.). The first communication was
with Plaintiff’s IT officer, Ben Meta, about an issue Neathamer was having with his computer.
(Id.). The second communication was with someone named “Jennifer,” whose last name Hughes
cannot recall, regarding supplies Neathamer would need for a conference. (Id.). Hughes’ only
communications with any persons employed by or representing accounts or potential accounts
1 Plaintiff's Amended Complaint alleges that alter-ego liability or corporate veil-piercing
theories support exercising personal jurisdiction over Hughes and the other individual
Defendants. Plaintiff alleges that Hughes was an “owner” and “integral member” of Defendant
T & A who, along with the other individual Defendants, “dominated and controlled” Defendant
T & A. Plaintiff's allegations concerning veil piercing are conclusory, nonspecific, and directly
contradicted by Hughes’ own sworn affidavit.
developed by T & A for Defendant were for strictly administrative reasons, such as
communicating about travel arrangements. (Id. at ¶¶ 16, 17).
Hughes also asserts that, contrary to Plaintiff’s allegations forming the basis for their
claims, she never directed invoices to vendors to be changed from Remi-captioned invoices to
NIR-captioned invoices; she never marked up Plaintiff’s price quotes in order to profit from the
markup without Plaintiff’s knowledge or authorization; she never contacted or solicited
Plaintiff’s customers or vendors; and she never communicated or attempted to communicate with
any entity named in the email attached to the Plaintiff's Amended Complaint as Exhibit C. (Id. at
¶¶ 18, 19, 20, 22).
Plaintiff’s only response to Hughes’ rebuttal of Plaintiff’s conclusory factual allegations
relies on the Declaration of Plaintiff’s Director of Infrastructure and Security, Matt Selmer, in
which he stated that Plaintiff had provided Hughes with an email address hosted by Plaintiff’s
server in North Carolina until it was moved to the “cloud,” without specifying in which state that
cloud server was located. (Selmer Decl., Doc. No. 11–1 at ¶¶ 3, 6). Selmer’s Declaration
alleged that Hughes had received and sent thousands of emails through the email address that
Plaintiff had provided her but did not discuss the substance of any of those emails. (Id.).
Likewise, in its response to the motion to dismiss, Plaintiff has not explained how any of those
emails was related to the activity giving rise to its claims against Defendants.
Plaintiff also failed, in its response to Hughes’ interrogatories, to provide facts to support
its position that this Court may exercise personal jurisdiction over Hughes.2 Plaintiff responded
2 Plaintiff explained in its response that its investigation was ongoing and that it reserved the
right to supplement the response should additional information become known to it, but Plaintiff
never supplemented its response. Furthermore, after Hughes’ deposition was taken on April 17,
2020, Plaintiff’s President Brent Howison testified in his own deposition that he was aware of no
further facts responsive to the above interrogatory. (Doc. No. 30-2, Howison Dep. 16:6–10).
to interrogatory number three of Hughes’s interrogatories by identifying its Chief Revenue
Officer, Dana Upshaw, as someone who had interacted with Hughes and who had conversations
with her “regarding Mr. Neathamer’s schedule and requests surrounding the mechanics of the
Thomas & Associates agreement with Remi, such as reporting.” (Doc. No. 30-1). When
questioned about this response, Howison said he did not know where he obtained that
information. (Doc. No. 30-2: Howison Dep. 21:10–20). When questioned further about what he
meant by the response, Howison gave vague, speculative responses which he could not testify
were given to him by anyone with first-hand knowledge. (Id. at 21:10–24:3).
In sum, Plaintiff has not carried its burden of establishing that Hughes purposefully
availed herself of anything other than having part-time employment with a company that was
connected to Plaintiff. Plaintiff wholly fails to establish any nexus between Hughes’
administrative activities and the threadbare, conclusory claims it asserted against her in its
Amended Complaint, which she has rebutted through her own sworn affidavit. Plaintiff merely
relies on the sheer quantity of emails sent and received by Hughes while she was employed part-
time by Defendant T & A without connecting a single one of Hughes’s communications to any
wrongful conduct on her part.3
In any event, to assert personal jurisdiction over Hughes would be constitutionally
unreasonable. The factors a court considers in weighing constitutional “reasonableness” include:
(1) the burden on the defendant of litigating in the forum; (2) the interest of the forum state in
adjudicating the dispute; (3) the plaintiff’s interest in obtaining convenient and effective relief;
3 Indeed, the only allegation of a specific act by Hughes is in Paragraph 30 of Plaintiff's
Amended Complaint, wherein Plaintiff alleges that Defendant Neathamer sent Hughes and
himself an email with the statement “deconstruct deals” and a list of names. This email does not
direct Hughes to take any action, and Plaintiff does not allege that Hughes took any action as a
result of this email.
(4) the shared interest of the states in obtaining efficient resolution of disputes; and (5) the
interests of the states in furthering substantive social policies. See Consulting Eng’rs Corp. v.
Geometric Ltd., 561 F.3d 273, 279 (4th Cir. 2009). “More generally, [the] reasonableness
analysis is designed to ensure that jurisdictional rules are not exploited in such a way as to make
litigation so gravely difficult and inconvenient that a party unfairly is at a severe disadvantage in
comparison to his opponent.” Nolan, 259 F.3d at 217 (internal quotation marks omitted). Here,
Hughes, a Tennessee resident, whose former, part-time employment with T & A consisted of
administrative duties, is not a corporation with large resources, and making her defend the claims
in North Carolina would be so gravely difficult and inconvenient that she would be unfairly and
severely disadvantaged in comparison to Plaintiff. For these reasons, the Court will grant
Hughes’ motion to dismiss.
IT IS THEREFORE ORDERED that:
(1) Defendant’s Motion to Dismiss, (Doc. No. 6), is GRANTED, and Defendant Hughes
is terminated from this action.
Signed: June 13, 2020
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Max O. Cogburn if iy
United States District Judge Toa gt