CrossCountry Mortgage, Inc. v. Messina

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF OHIO

CrossCountry Mortgage, Inc., Case No. 1:19cv1021

Plaintiff,

-vs- JUDGE PAMELA A. BARKER

Joseph Messina, et al.,

MEMORANDUM OPINION AND

Defendants ORDER

Currently pending are the Motions of Defendants Joseph Messina and Luis Tamayo to

Dismiss for Lack of Personal Jurisdiction. (Doc. Nos. 17, 20.) Plaintiff CrossCountry Mortgage,

Inc., filed Briefs in Opposition (Doc. Nos. 31, 35), to which Defendants responded (Doc. Nos. 34,

36.) For the following reasons, Defendants’ Motions are DENIED.

I. Procedural Background

On May 7, 2019, Plaintiff CrossCountry Mortgage, Inc. (hereinafter “Plaintiff” or

“CrossCountry”) filed a Complaint against Defendants Joseph Messina and Luis Tamayo, alleging

claims for breach of contract, breach of fiduciary duties, conspiracy, conversion, and

misappropriation of trade secrets under state and federal law. (Doc. No. 1.)

Defendant Joseph Messina filed an Answer on July 3, 2019. (Doc. No. 7.) The docket reflects

that Plaintiff made several attempts to obtain service on Defendant Tamayo, ultimately requesting

service by the Clerk by ordinary mail on August 27, 2019. (Doc. No. 14.) Copies of the summons

and Complaint were thereafter mailed to Defendant Tamayo on August 28, 2019. (Doc. No. 15.)

On September 2 and 17, 2019, respectively, Defendants Messina and Tamayo filed Motions

to Dismiss for Lack of Personal Jurisdiction. (Doc. Nos. 17, 20.) On those same dates, Defendants

also filed Motions to Stay Discovery pending rulings on the motions to dismiss. (Doc. Nos. 18, 21.)

Plaintiff opposed each of Defendants’ motions. (Doc. Nos. 19, 27, 31, 35.) Defendants filed a joint

Reply in support of their Motions to Stay Discovery on October 3, 2019. (Doc. No. 32.)

On October 8, 2019, the Court issued an Order denying Defendants’ Motions to Stay

Discovery pending ruling on their Motions to Dismiss. (Doc. No. 33.)

Defendant Messina thereafter filed a Reply in support of his Motion to Dismiss on October

14, 2019 (Doc. No. 34), while Defendant Tamayo filed a Reply in support of his Motion on October

30, 2019. (Doc. No. 36.)

II. Factual Allegations

Plaintiff CrossCountry (hereinafter “Plaintiff” or “CrossCountry”) alleges the following facts.

Plaintiff is an Ohio corporation with its principal place of business in Brecksville, Ohio. (Doc. No.

1 at ¶ 7.) It is “a growing retail mortgage lender licensed in all 50 states that offers customers a range

of mortgage loan services and products.” (Id.)

In or about August 2016, Defendant Messina traveled to Plaintiff’s headquarters in Ohio to

interview for the position of branch manager of Plaintiff’s Berwyn, Illinois office. (Doc. No. 31-1,

Declaration of Jennifer Stracensky dated Oct. 2, 2019 (hereinafter “Stracensky Decl. I”) at ¶ 2). In

September 2016, Plaintiff hired Messina for the position. (Id. at ¶ 3.) That same month, Plaintiff

hired Defendant Tamayo as the sales manager of the Berwyn, Illinois branch. (Doc. No. 35-1,

Declaration of Jennifer Stracensky dated Oct. 17, 2019 (hereinafter “Stracensky Decl. II”) at ¶ 2.)

Both Defendants Messina and Tamayo are lifelong residents of the State of Illinois. See Doc. No.

17-2, Declaration of Joseph Messina (hereinafter “Messina Decl.”) at ¶ 2; Doc. No. 20-2, Declaration

of Luis Tamayo (hereinafter “Tamayo Decl.”) at ¶ 2.

2

On September 30, 2016, Defendants Messina and Tamayo each entered into Employment

Agreements with Plaintiff.1 (Doc. No. 1 at ¶ 11.) Plaintiff alleges that it “negotiated and executed

the Employment Agreements at its corporate headquarters in Brecksville, Ohio.” (Id. at ¶ 12.)

Defendants Messina and Tamayo aver that they executed their respective Agreements in Illinois.

(Messina Decl. at ¶ 4; Tamayo Decl. at ¶ 4.)

In their Employment Agreements, Defendants acknowledge that Plaintiff invested time,

money, and other resources to develop and maintain relationships with its current and prospective

employees and customers, and to develop and compile confidential information and trade secrets.

(Doc. No. 1 at ¶ 13, citing Messina Agreement §5.3, Tamayo Agreement § 4.3). Plaintiff alleges

that, as CrossCountry loan officers, both Messina and Tamayo had access to this confidential trade

secret information. (Id.)

To protect this information, the Employment Agreements restrict the use and disclosure of

Plaintiff’s “Confidential Material,” as that term is defined in the Agreement. (Doc. No. 1 at ¶ 16,

citing Messina Agreement §5.1(b), Tamayo Agreement § 4.1(b)). The Employment Agreements also

strictly prohibit Defendants from soliciting or recruiting Plaintiff’s employees for employment with

anyone else, including other mortgage lenders, for a period of two years following cessation of their

employment with CrossCountry. (Id. at ¶ 17, citing Messina Agreement §5.3, Tamayo Agreement

§5.3). In addition, the Employment Agreements prohibit Defendants from soliciting current or

prospective customers for a period of two years after their termination, resignation, and/or separation

from employment. (Id. at ¶ 19, citing Messina Agreement §5.3, Tamayo Agreement §4.3.)

1 Copies of these Agreements are attached to the Complaint as Exhibits A and B. (Doc. Nos. 1-1, 1-2.)

3

Each Employment Agreement contains a choice of law provision providing that “this

Agreement shall be governed by and construed in accordance with the substantive laws of Federal

law and the laws of the State of Ohio.” (Messina Agreement at § 6.7; Tamayo Agreement at § 5.7).

Additionally, the Agreements contain arbitration clauses that provide, in relevant part, that “[t]o the

maximum extent permissible under applicable law, any and all hearings or other proceedings shall be

held at a place in Cuyahoga County, Ohio that is mutually agreeable to the Parties.” (Messina

Agreement at § 6.18; Tamayo Agreement at § 5.19.)

Plaintiff alleges that, during the term of his employment, Defendant Messina reported directly

to CrossCountry’s Chief Executive Officer (“CEO”) Ronald Leonhardt, Jr. and its Chief Production

Officer (“CPO”) Craig Montgomery, both of whom are based in Ohio. (Stracensky Decl. I at ¶ 4.)

Plaintiff asserts that Leonhardt and Montgomery “regularly communicated with Mr. Messina – from

Ohio – regarding the strategy and performance of Mr. Messina’s branch, and regularly gave him

direction in that regard.” (Id. at ¶ 5.) Plaintiff further alleges as follows:

During at least a portion of his employment at CrossCountry, Mr. Messina regularly

communicated with CrossCountry personnel in Ohio for purposes of processing

mortgage loans. More specifically, for at least a portion of Mr. Messina's employment,

the CrossCountry underwriters and closers for loans originated by Mr. Messina and

his branch were based in CrossCountry's Ohio headquarters. When Mr. Messina

originated a loan for a customer, he was required to submit paperwork regarding the

loan to a CrossCountry underwriter, who would evaluate the loan and decide whether

to approve it. After approval, a CrossCountry closer would prepare all of the loan

documents and send them to Mr. Messina and his branch to be executed. Although

some loans originated by Mr. Messina were processed by underwriters and closers

stationed outside of Ohio, those underwriters and closers all reported to

CrossCountry's corporate office and, as Mr. Messina was aware, those individuals

were required to escalate any issues regarding loans originated by Mr. Messina to their

superiors in Ohio. Ultimately, CrossCountry would fund the mortgage loan for the

customer whose loan was originated by Mr. Messina, using CrossCountry funds in

Ohio.

4

(Stracensky Decl. I at ¶ 10.) In addition, according to Plaintiff, Messina periodically aired

commercials for the Berwyn branch office on local radio stations. (Id. at ¶ 13.) Plaintiff alleges

Messina worked with CrossCountry marketing employees in Ohio on those commercials and

submitted invoices for all such commercial air time to Plaintiff’s accounts payable department in

Ohio. (Id.)

Moreover, Plaintiff claims that both Defendants Messina and Tamayo regularly submitted

invoices for business expenses to Plaintiff’s Ohio headquarters for payment or reimbursement which

were approved by CrossCountry personnel in Ohio and paid from CrossCountry funds in Ohio. (Id.

at ¶ 7; Stracensky Decl. II at ¶5.) Defendants were both compensated from CrossCountry in Ohio,

“from funds located in Ohio.” (Stracensky Decl. I at ¶ 6; Stracensky Decl. II at 4.) Plaintiff also

“paid the rent for Mr. Messina’s Berwyn branch office from Ohio and using Ohio funds,” and

provided the physical assets (such as the computer hardware, IT equipment, and telephones) from

Ohio. (Stracensky Decl. I at ¶ 8; Stracensky Decl. II at ¶ 6.)

On December 27, 2018, Defendant Messina sent an email to Plaintiff’s CEO, Mr. Leonhardt,

asking for increases in compensation for himself and Defendant Tamayo’s brothers, Jose and Juan

Tamayo. (Stracensky Decl. I at ¶ 14.) Therein, Messina asked Mr. Leonhardt to double the salaries

of himself, Jose Tamayo, and Juan Tamayo from $10,000 per month to $20,000 per month each. (Id.)

He also asked for a $10,000 bonus “draw” to be paid to each of them. (Id.) Based on documentation

attached to Plaintiff’s Brief in Opposition to Defendant Tamayo’s Motion to Dismiss, it appears that

Defendant Messina, Defendant Tamayo and at least one of Mr. Tamayo’s brothers spoke with Mr.

Leonhardt by telephone during the first week of January 2019 regarding Messina’s email. (Doc. No.

35-1 at PageID# 418-419; Stracensky Decl. II at ¶ 10.) In asking for this increase in compensation,

5

Messina advised Mr. Leonhardt that he was “very confident that 2019 is going to be our best year

yet.” (Stracensky Decl. I at ¶ 14.) Plaintiff granted Messina’s requests. (Id.)

Plaintiff alleges that, very shortly thereafter (in early 2019), Defendants Messina and Tamayo

began working with competitor Parkside Lending to “poach CrossCountry’s entire Berwyn branch.”

(Doc. No. 1 at ¶ 27.) At the same time, in January and February 2019, Messina submitted invoices

to Plaintiff’s accounts payable department in Ohio for payment of at least $59,500. (Stracensky Decl.

I at ¶ 15.) Plaintiff alleges that Messina represented that these invoices were for local radio air time

and on-air talent to advertise Plaintiff’s Berwyn, Illinois branch. (Id.) Plaintiff approved and paid

the invoices from its Ohio headquarters. (Id.) Plaintiff alleges that Messina “used the resulting paid-

for air time to advertise for Parkside Lending rather than CrossCountry.” (Id.) Plaintiff also asserts

that Messina and Tamayo conspired together to obtain Messina’s increase in compensation (including

his bonus) “under false pretenses,” knowing that they were leaving CrossCountry for Parkside

Lending. (Stracensky Decl. II at ¶ 11.)

Plaintiff alleges that, during early 2019 and while still employed by CrossCountry,

Defendants Messina and Tamayo began wrongfully recruiting other Berwyn employees to join them

and, in fact, recruited “at least thirteen other CrossCountry employees to quit CrossCountry and join

Parkside in a mass, orchestrated exodus on March 12, 2019.” (Doc. No. 1 at ¶ 28.) Plaintiff further

asserts that, before leaving CrossCountry on March 12, 2019, Defendants misappropriated Plaintiff’s

Confidential Materials, including its customer information. (Id. at ¶ 30.) In particular, Plaintiff

alleges that it has “identified at least nineteen loan customers whose loans were being processed by

6

CrossCountry, or had previously closed at CrossCountry, that have been diverted by [Defendants]

Messina and Tamayo to Parkside.”2 (Id.)

On April 1, 2019, Plaintiff sent a cease and desist letter to Defendant Messina and Parkside

asking that they cease and desist soliciting Plaintiff’s customers and employees, and “immediately

account for the use of any of CrossCountry’s confidential information, including without limitation,

by identifying all customer information taken from Cross Country.” (Id. at ¶ 32.) Plaintiff claims that

Defendants Messina and Tamayo are nonetheless “continuing to process the loans of diverted

CrossCountry customers for Parkside, even after receiving CrossCountry’s cease-and-desist letter,

further confirming that their misconduct is knowing and intentional.” (Id.)

III. Analysis

Plaintiff bears the burden of proving personal jurisdiction. Theunissen v. Matthews, 935 F.2d

1454, 1458 (6th Cir. 1991). If a court rules on a Rule 12(b)(2) motion to dismiss for lack of personal

jurisdiction prior to trial, “it has the discretion to adopt any of the following courses of action: (1)

determine the motions based on affidavits alone; (2) permit discovery, which would aid in resolution

of the motion; or (3) conduct an evidentiary hearing on the merits of the motion.” Intera Corp. v.

Henderson, 428 F.3d 605, 614 n.7 (6th Cir. 2005). “[T]he decision whether to grant discovery or an

evidentiary hearing before ruling on a 12(b)(2) motion is discretionary.” Burnshire Dev., LLC v.

Cliffs Reduced iron Corp., 198 Fed. Appx. 425, 434 (6th Cir. 2006).

2 As discussed infra, Plaintiff asserts that the Confidential Information misappropriated by Defendants Messina and

Tamayo was maintained on Plaintiff’s computer database, known as “Encompass.” (Stracensky Decl. I at ¶ 11;

Stracensky Decl. II at ¶ 8.) Plaintiff claims this database “is maintained and managed by CrossCountry IT personnel in

Ohio,” and was accessible only through a specific employee ID and password provided by CrossCountry. (Id.)

7

When a district court rules on a jurisdictional motion to dismiss made pursuant to Rule

12(b)(2) without conducting an evidentiary hearing, the court must consider the pleadings and

affidavits in a light most favorable to the plaintiff. CompuServe, Inc. v. Patterson, 89 F.3d 1257,

1262 (6th Cir. 1996). To defeat such a motion, a plaintiff need only make a prima facie showing of

jurisdiction, which can be met by “establishing with reasonable particularity sufficient contacts

between the defendant and the forum state to support jurisdiction.” Neogen Corp. v. Neo Gen

Screening, Inc., 282 F.3d 883, 887 (6th Cir. 2002). A court disposing of a Rule 12(b)(2) motion does

not weigh the controverting assertions of the party seeking dismissal but may consider a defendant’s

undisputed factual assertions. See CompuServe, 89 F.3d at 1262; Theunissen, 935 F.2d at 1459;

NTCH-West Tenn, Inc., v. ZTE Corp., 761 Fed. Appx. 485, 488 (6th Cir. Jan. 16, 2019) (citing Kerry

Steel, Inc. v. Paragon Industries, Inc., 106 F.3d 147, 153 (6th Cir. 1997)). “Dismissal in this

procedural posture is proper only if all the specific facts which the plaintiff . . . alleges collectively

fail to state a prima facie case for jurisdiction.” Id. See also Kerry Steel, Inc., 106 F.3d at 149.

“In a diversity case, a federal court can exercise personal jurisdiction over a defendant if

jurisdiction is (1) authorized by the law of the state in which it sits, and (2) in accordance with the

Due Process Clause of the Fourteenth Amendment.” Tharo Systems, Inc. v. Cab Producktechnik

GMBH & Co., KG, 196 Fed. Appx. 366 (6th Cir. 2006). Because “Ohio’s long-arm statute is not

coterminous with federal constitutional limits,” to establish a prima facie case of personal

jurisdiction, a plaintiff must demonstrate that (1) Ohio’s long-arm statute has been satisfied and (2)

exercising jurisdiction would comport with Due Process. Schneider v. Hardesty, 669 F.3d 693, 699

(6th Cir. 2012) (quoting Estate of Thomson ex rel. Estate of Rakestraw v. Toyota Motor Corp.

8

Worldwide, 545 F.3d 357, 361 (6th Cir. 2008)); Kauffman Racing Equip., LLC v. Roberts, 126 Ohio

St.3d 81, 930 N.E.2d 784, 790 (Ohio 2010)).

Here, Defendants argue that this matter must be dismissed because (1) the requirements of

Ohio’s Long Arm Statute are not met; and (2) the exercise of jurisdiction over does not comport with

the Due Process Clause. The Court will address Defendants’ arguments separately, below.

A. Ohio’s Long Arm Statute

The relevant provisions of Ohio’s Long Arm Statute provide as follows:

(A) A court may exercise personal jurisdiction over a person who acts directly or by

an agent, as to a cause of action arising from the person's:

(1) Transacting any business in this state;

***

(4) Causing tortious injury in this state by an act or omission outside this state if he

regularly does or solicits business, or engages in any other persistent course of

conduct, or derives substantial revenue from goods used or consumed or services

rendered in this state;

***

(6) Causing tortious injury in this state to any person by an act outside this state

committed with the purpose of injuring persons, when he might reasonably have

expected that some person would be injured thereby in this state . . .

Ohio Rev. Code § 2307.382(A)(1), (4), & (6). Furthermore, according to Ohio Rev. Code §

2307.382(C), “[w]hen jurisdiction over a person is based solely upon this section, only a cause of

action arising from acts enumerated in this section may be asserted against him.” The Sixth Circuit

has held that this Section “requires a ‘proximate cause’ relationship” between a plaintiff’s claim and

the defendant’s conduct in Ohio, which is a “tighter fit” than the “but for” approach under the Due

Process Clause. See Brunner v. Hampson, 441 F.3d 457, 465-466 (6th Cir. 2006). See also Burnshire

9

Development, LLC, 198 Fed. Appx. at 432, fn 2; Malone v. Stanley Black & Decker, Inc., 393

F.Supp.3d 721, 725 (N.D. Ohio 2019).

Here, Plaintiff argues Subsections (A)(1), (4) and (6) are satisfied, with respect to both

Defendants Messina and Tamayo.3 With regard to Ohio Rev. Code § 2307.382(A)(1), Plaintiff argues

Defendants “transacted business” in Ohio because both Defendants Messina and Tamayo (1) had and

continue to have ongoing confidentiality and restrictive covenant obligations to Plaintiff, an Ohio

company; (2) received their compensation and benefits from Plaintiff in Ohio; and (3) regularly

received and routinely accessed Plaintiff’s confidential information from its computer database that

was maintained and managed in Ohio. (Doc. No. 31 at p. 11; Doc. No. 35 at p. 10.) In addition, as

further support for its argument that Defendant Messina’s contacts with Plaintiff satisfy §

2307.382(A)(1), Plaintiff notes that Messina (1) admitted traveling to Ohio to interview with

CrossCountry and discuss his prospective employment; (2) regularly communicated with and

received instructions from Mr. Leonhardt and Mr. Montgomery in Ohio; and (3) used underwriters

and closers at Plaintiff’s headquarters to approve and close mortgage loans. (Doc. No. 31 at p. 11.)

Defendants argue § 2307.382(A)(1) is not satisfied because “everything [they] did was from

[their] Illinois business office, and not in Ohio.” (Doc. No. 17-1 at p. 7; Doc. No. 20-1 at p. 8.)

Defendants maintain that the mere fact that they entered into a contract with an Ohio corporation and

3 Plaintiff also argues that Defendants consented to personal jurisdiction in this Court by signing Employment Agreements

that contained arbitration forum selection clauses. (Doc. No. 31 at pp. 6-8; Doc. No. 35 at pp. 5-8.) See e..g. Messina

Employment Agreement § 6.18 (“To the maximum extent permissible under applicable law, any and all [arbitration]

hearings or other proceedings shall be held at a place in Cuyahoga County, Ohio that is mutually agreeable to the Parties.”)

Defendants disagree, arguing that the case law cited by Plaintiff is distinguishable because several of the claims at issue

in this action are specifically exempted from arbitration under Defendants’ Employment Agreements. (Doc. No. 34 at

pp. 2-7.) The Court need not reach this issue. As discussed infra, even without consideration of the Agreements’

arbitration forum selection clauses, the Court finds Plaintiff has made a prima facie showing of personal jurisdiction

under Ohio’s Long Arm Statute and the Due Process Clause.

10

received payments from that entity is not enough to establish jurisdiction under this provision,

particularly given the fact that Defendants signed their Employment Agreements in Illinois;

conducted business with Plaintiff from their Illinois offices; conducted business with other Illinois

citizens; used Illinois resources; and developed business in Illinois for Plaintiff’s branch office in

Illinois. (Doc. No. 17-1 at p. 9; Doc. No. 20-1 at p. 8.)

The Ohio Supreme Court has stated that Ohio Rev. Code § 2307.382(A)(1) is “very broadly

worded and permit[s] jurisdiction over nonresident defendants who are transacting any business in

Ohio.” Muzzin v. Brooks, 859 N.E.2d 584, 588 (Ohio Ct. App. 8th Dist. 2006); Kentucky Oaks Mall

Co. v. Mitchell's Formal Wear, Inc., 559 N.E.2d 477, 480 (Ohio 1990). See also Dayton Superior

Corp. v. Yan, 288 F.R.D. 151, 160 (S.D. Ohio 2012). As that court has explained, the term

“‘[t]ransact,’ as defined by Black's Law Dictionary (5th ed. 1979) 1341, ‘means to prosecute

negotiations; to carry on business; to have dealings [ ]. The word embraces in its meaning the carrying

on or prosecution of business negotiations but it is a broader term than the word ‘contract’ and may

involve business negotiations which have been either wholly or partly brought to a conclusion[ ].'“

Kentucky Oakes Mall Co., 559 N.E.2d at 480. See also International Paper Co. v. Goldschmidt, 872

F.Supp.2d 624, 629 (S.D. Ohio 2012); The RightThing, LLC v. Brown, 2009 WL 249694 at * 3 (N.D.

Ohio Feb. 2, 2009).

Interpreting this provision, federal courts within this Circuit have found that “while the mere

existence of a contract may not be enough to confer personal jurisdiction [under Section (A)(1)], a

contract may qualify as transacting business under Ohio’s long-arm statute, particularly when it

imposes continuing obligations on the parties affecting the State of Ohio.” Tarkett USA, Inc v. Harnix

Corp., 2017 WL 2443139 at * 3 (N.D. Ohio June 6, 2017). See also Alloy Bellows & Precision

11

Welding, Inc. v. Cole, 2015 WL 6964579 at * 3 (N.D. Ohio Nov. 10, 2015). Moreover, the Ohio

Supreme Court has noted that “personal jurisdiction does not require physical presence in the forum

state.” Goldstein v. Christiansen, 638 N.E.2d 541, 544 (Ohio 1994).

With respect to Defendant Messina, the Court finds Plaintiff has alleged sufficient contacts

with the State of Ohio to satisfy the requirements of Ohio Rev. Code § 2307.382(A)(1). Messina

travelled to Plaintiff’s headquarters in Ohio to interview for the position of branch manager and

discuss the terms of his prospective employment. (Stracensky Decl. I at ¶ 2.) He executed an

Employment Agreement with an Ohio corporation, knowing that that Agreement imposed continuing

obligations on him to (among other things) maintain the confidentiality of Plaintiff’s Confidential

Information. (Doc. No. 1 at ¶¶ 11, 13-16.) In addition, during his employment, Messina regularly

communicated with Mr. Leonhardt and Mr. Montgomery in Ohio regarding the strategy and

performance of Messina’s branch office and, further, regularly communicated with CrossCountry

personnel in Ohio for purposes of processing mortgage loans. (Stracensky Decl. I at ¶¶ 5, 10.)

Plaintiff also alleges that Messina routinely submitted invoices for business expenses to its Ohio

headquarters, which were approved by CrossCountry personnel in Ohio and paid with CrossCountry

funds located in Ohio. (Id. at ¶ 7.) Messina also allegedly accessed confidential information from

Plaintiff’s computer database, which is maintained and managed by CrossCountry IT personnel in

Ohio. (Id. at ¶ 11.) Lastly, Plaintiff states that Messina’s compensation was paid from CrossCountry

in Ohio from funds located in Ohio. (Id. at ¶ 6.)

The Court finds the above allegations are sufficient to demonstrate that Defendant Messina

“transacted business” in Ohio for purposes of Ohio Rev. Code § 2307.382(A)(1). Other courts have

reached the same conclusion under similar circumstances. See, e.g., Tarkett USA, Inc., 2017 WL

12

2443139 at * 3 (finding § 2307.382(A)(1) met where non-resident former employee traveled to Ohio,

received payments from Ohio, regularly communicated with and received instruction from Ohio, and

negotiated his Separation Agreement, in part, in Ohio); Dayton Superior Corp., 288 F.R.D. at 166

(finding § 2307.382(A)(1) met where non-resident former employee applied to work at an Ohio

company and signed various agreements knowing that employer was located in Ohio, received

employer’s confidential information which had been located and managed in Ohio, communicated

with individuals in Ohio, admitted traveling at least once to Ohio, and received his compensation and

benefits from Ohio); The RightThing, LLC, 2009 WL 249694 at * 3 (finding § 2307.382(A)(1) met

where non-resident former employee visited Ohio on occasion, regularly received reports and

proposals from Ohio, and accessed information stored on employer’s Ohio-based data servers).

Whether Plaintiff has established that Defendant Tamayo has sufficient contacts with the State

of Ohio for purposes of § 2307.382(A)(1) is a closer call. Unlike Defendant Messina, there is no

allegation that Defendant Tamayo visited Plaintiff’s headquarters in Ohio. Nor has Plaintiff

submitted any Declarations or other evidence indicating that Tamayo regularly received instruction

from CrossCountry personnel in Ohio. Plaintiff does, however, allege that Tamayo knowingly

executed an Employment Agreement with CrossCountry that subjected him to continuing

confidentiality, non-competition, and non-solicitation obligations to Plaintiff. (Doc. No. 1 at ¶¶ 11,

13-20.) Plaintiff further alleges that, like Defendant Messina, Defendant Tamayo accessed Plaintiff’s

confidential information through its computer database, which is maintained and managed by

CrossCountry personnel in Ohio. (Stracensky Decl. II at ¶ 8.) Plaintiff also asserts that Tamayo

regularly submitted invoices for business expenses to CrossCountry headquarters in Ohio and

received his compensation and benefits from Plaintiff in Ohio. (Id. at ¶¶ 4, 5.)

13

On balance, and given the Ohio Supreme Court’s broad construction of the term “transacting

business,” the Court finds Plaintiff has established sufficient contacts between Defendant Tamayo

and Ohio for purposes of § 2307.382(A)(1). As noted above, Tamayo knowingly contracted with an

Ohio corporation and agreed to be bound by several provisions establishing continuing and ongoing

obligations to CrossCountry. In addition, during the term of his employment, Tamayo allegedly

accessed Plaintiff’s confidential information from its Ohio computer database, repeatedly reached out

to Plaintiff’s Ohio personnel for payment of his various business expenses, and received his

compensation and benefits from CrossCountry in Ohio. Although Tamayo did not physically visit

the State of Ohio, the Ohio Supreme Court has found that “personal jurisdiction does not require

physical presence in the forum state.” Goldstein, 638 N.E.2d at 544. Taken as a whole, the Court

finds Plaintiff has sufficiently demonstrated that Defendant Tamayo “transacted business” in Ohio

for purposes of § 2307.382(A)(1).

The Court further finds there is sufficient evidence to satisfy Ohio’s Long Arm Statute under

Section (A)(6), with respect to both Defendants Messina and Tamayo. As set forth supra, Section

2307.382(A)(6) provides for jurisdiction over a person who “caus[es] tortious injury in this state to

any person by an act outside this state committed with the purpose of injuring persons, when he might

reasonably have expected that some person would be injured thereby in this state.” Ohio Rev. Code

§ 2307.382(A)(6). Like Section (A)(1), Section (A)(6) has been interpreted broadly. See Schneider

v. Hardesty, 669 F.3d 693, 700 (6th Cir. 2012); Pay(q)r, LLC v. Sibble, 2015 WL 9583034 at * 5

(N.D. Ohio Dec. 31, 2015).

Here, Plaintiff alleges that Defendants Messina and Tamayo committed tortious acts outside

Ohio that caused injury within this State. Specifically, Plaintiff asserts Defendants secretly conspired

14

to join a competitor and accessed and used Plaintiff’s confidential customer information from its Ohio

computer database to further their plans. (Doc. No. 1 at ¶ 4, 27, 30.) Plaintiff also maintains that

Defendants essentially stole CrossCountry’s funds by “caus[ing] themselves to be paid bonuses by

CrossCountry, and incur[ing] expenses for CrossCountry that were outside the ordinary course of

business” and “actually for Parkside’s benefit.” (Id. at ¶ 29.) Plaintiff further asserts that Defendants

Messina and Tamayo agreed that any breach of their respective confidentiality or restrictive

convenants would cause irreparable injury to CrossCountry in Ohio.4 (Id. at ¶ 22.)

Thus, Plaintiff has come forward with evidence that Defendants misused Plaintiff’s

confidential information and converted Plaintiff’s property, both of which are tortious acts.

Moreover, the Court finds Defendants could reasonably have expected that injury would occur in

Ohio by taking the confidential information of their Ohio-based employer. Faced with similar facts,

courts within this Circuit have found the requirements of § 2307.382(A)(6) to be met. See e.g.,

Tarkett USA, Inc., 2017 WL 2443139 at * 4 (finding § 2307.382(A)(6) met where non-resident former

employee breached his non-compete and non-disclosure agreements with Ohio-based employer);

Alloy Bellows & Precision Welding, Inc., 2015 WL 6964579 at * 4 (finding § 2307.382(A)(6) met

where non-resident former employee removed employer’s confidential trade secrets from its Ohio

computer system); Dayton Superior Corp., 288 F.R.D. at 167 (finding § 2307.382(A)(6) met where

4 The Complaint cites Defendants’ Employment Agreements, which provide as follows: “[Cross Country] and Employee

recognize and acknowledge that in the event of any breach of any provision of this Article [i.e., Protected Information

and Restrictive Covenants], irreparable harm will be suffered by [CrossCountry] and that any remedy available at law

will be inadequate and [CrossCountry] and Employee do, therefore, agree that in such event [CrossCountry] shall be

entitled to injunctive relief in any court of competent jurisdiction against Employee and against any other person or entity

involved in or connected with such breach, without necessity of posting any bond, cash or security against/for Employee

or any individual or entity involved in or connected with such breach, which rights shall be in addition to such rights as

[CrossCountry] may have for damages and in addition to such other remedies as the law or equity may provide.” (Doc.

No. 1 at ¶ 22, citing Messina Agreement § 5.5, Tamayo Agreement § 4.5).

15

non-resident former employee misappropriated employers’ trade secrets outside of Ohio); Coast to

Coast Health Care Services, Inc. v. Meyerhoffer, 2012 WL 169963 at * 3 (S.D. Ohio Jan. 19, 2012)

(finding § 2307.382(A)(6) met where non-resident former employee misappropriated trade secrets

and noting “if Meyerhoffer secretly conspired to start a competitor company and utilized Coast to

Coast's national client lists, prospective client lists, and independent contractor physician provider

lists and also began contacting clients of Coast to Coast, she should have reasonably expected that

Dr. Bolton's Ohio business would be damaged.”); Safety Today, Inc. v. Roy, 2012 WL 2374984 at *

2 (S.D. Ohio June 22, 2012) (finding § 2307.382(A)(6) met where non-resident former employee

took the customer lists and confidential information of their Ohio-based employer). Accordingly, the

Court finds that Plaintiff has sufficiently alleged that the requirements of § 2307.382(A)(6) are met

with respect to both Defendants Messina and Tamayo.5

As noted above, to demonstrate that the requirements of Ohio’s Long Arm Statute are met,

Plaintiff must also show that its causes of action “arise from acts enumerated in this section,” which

the Sixth Circuit has interpreted as requiring a showing that a defendant’s conduct in Ohio is the

“proximate cause” of the plaintiff’s causes of action. See Ohio Rev. Code § 2307.382(C); Brunner,

5 The cases relied upon by Defendants to the contrary are distinguishable. Specifically, Defendants’ reliance on University

of Louisville v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 2017 WL 5015513 (W.D. Ky. Nov. 2, 2017) and V-Soft

Consulting Group v. Logic Corp., 2017 WL 1228402 (W.D. Ky. March 31, 2017) is misplaced because both cases involve

application of Kentucky’s (rather than Ohio’s) Long Arm Statute. Moreover, neither case involved claims arising from

the alleged breach of an employment agreement. While Buckeye Check Cashing of Arizona, Inc. v. Lang, 2007 WL

641824 (S.D. Ohio Feb. 23, 2007) does involve the application of Ohio’s Long Arm Statute in the context of an alleged

breach of an employment agreement, the Court finds that case to be distinguishable as well. In Buckeye Check Cashing,

plaintiff alleged that defendants (both of whom were Arizona residents) breached the non-competition provisions of their

respective employment agreements by accepting employment with an Arizona competitor. Based on defendants’ minimal

connections to Ohio, the court found personal jurisdiction did not exist under §§ 2307.382(A)(1), (3) or (4). Here,

however, the Court finds that the exercise of jurisdiction is appropriate under § 2307.382(A)(6) based on Plaintiff’s

allegations that Defendants breached their employment agreements by repeatedly accessing and misusing confidential

information obtained from the plaintiff’s Ohio-based computer system. Thus, the nature and quantity of Defendants’

alleged contacts with Ohio herein are substantially greater than that at issue in Buckeye Check Cashing.

16

441 F.3d at 466. See also United States for use and benefit of South Shore Electric, Inc. v. P and E

Construction, LLC, 2019 WL 1205447 at * 3 (N.D. Ohio March 14, 2019).

The Court finds Plaintiffs have sufficiently alleged that its causes of action “arise from”

Defendants’ conduct in this State. In the Complaint, Plaintiff alleges claims for (1) breach of contract,

(2) breach of fiduciary duties; (3) conspiracy to breach fiduciary duties; (4) conversion; and (5)

misappropriation of trade secrets under Ohio and federal law. With the exception of the conversion

claim, each of Plaintiff’s claims are based, in part, on the allegation that Defendants Messina and

Tamayo improperly used Plaintiff’s confidential customer information to divert CrossCountry’s

customers and business to Parkside. Plaintiff alleges that Defendants accomplished this by accessing

the confidential information stored on Plaintiff’s computer data base, which it alleges is maintained

and managed by CrossCountry IT personnel in Ohio. (Stracensky Decl. I at ¶ 11; Stracensky Decl.

II at ¶ 8.) Based on these allegations, the Court finds Plaintiff’s breach of contract, breach of fiduciary

duties, conspiracy, and trade secrets claims “arise from” Defendants’ alleged conduct in Ohio.

With respect to Plaintiff’s conversion claim, Plaintiff asserts Defendants “wrongfully used

their positions at CrossCountry to wrongfully pay themselves bonuses using CrossCountry’s money.”

(Doc. No. 1 at ¶ 52.) As noted supra, Plaintiff asserts that, on December 27, 2018, Defendant Messina

sent an email to Mr. Leonhardt in Ohio, in which he requested bonuses for himself and Defendant

Tamayo’s brothers. (Stracensky Decl. I at ¶ 14; Stracensky Decl. II at ¶ 10.) Plaintiff further claims

that, in early January 2019, Defendants Messina and Tamayo (and one of Mr. Tamayo’s brothers)

spoke to Mr. Leonhardt by telephone reiterating their request for a bonus. (Stracensky Decl. II at ¶

10.) Based in part on Defendants’ representations during that telephone call, Plaintiff granted the

17

bonus requests. (Id.) Plaintiff alleges Defendants obtained this money “under false pretenses,

knowing that both they and the entire branch were leaving CrossCountry for Parkside Lending.” (Id.)

Based on these allegations, the Court finds Plaintiff’s conversion claim “arises from”

Defendants’ alleged conduct in Ohio. Defendants allegedly reached out to Mr. Leonhardt in Ohio

(via email and phone by Messina, and via phone only by Tamayo) to request bonuses, knowing that

they were leaving CrossCountry and with the intent to use the bonus money for the benefit of

Parkside. Although Defendant Tamayo was not copied on the December 27, 2018 email and

apparently did not request a bonus for himself (contrary to the allegations in the Complaint),

CrossCountry alleges that Tamayo conspired with Messina to obtain this money from CrossCountry

under false pretenses in order to aid their transition to Parkside. (Stracensky Decl. II at ¶ 10.) The

Court finds these allegations sufficient to satisfy Ohio Rev. Code § 2307.382(C) with respect to both

Defendants.

Accordingly, and for all the reasons set forth above, the Court finds Plaintiff has established

that this Court has jurisdiction over Defendants Messina and Tamayo under Ohio Rev. Code §

2307.382(A)(1) and (A)(6).6

B. Due Process

Plaintiff must also, however, demonstrate that the exercise of personal jurisdiction over

Defendants Messina and Tamayo would comport with the Due Process Clause. As the Sixth Circuit

has explained, “there are two kinds of personal jurisdiction within the Due Process inquiry,” i.e.,

general jurisdiction and specific jurisdiction. Conn v. Zakharov, 667 F.3d 705, 713 (6th Cir. 2012).

6 Because the Court finds it has jurisdiction under §§ 2307.382(A)(1) and (6), it need not reach Plaintiff’s argument that

jurisdiction exists under § 2307.382(A)(4).

18

General jurisdiction requires a showing that the defendant has continuous and systematic contacts

with the forum state sufficient to justify the state's exercise of judicial power with respect to any and

all claims the plaintiff may have against the defendant, whereas specific jurisdiction exposes the

defendant to suit in the forum state only on claims that “arise out of or relate to” a defendant's contacts

with the forum. Kerry Steel, Inc., 106 F.3d at 149 (citing Helicopteros Nacionales de Colombia S.A.,

v. Hall, 466 U.S. 408, 414–415 & fns. 8–10, 104 S.Ct. 1868, 1872 & fns. 8–10, 80 L.Ed.2d 404

(1984) and Third Nat'l Bank in Nashville v. WEDGE Group, Inc., 882 F.2d 1087, 1089 (6th

Cir.1989)).

Here, Defendants argue that Ohio does not recognize the concept of general jurisdiction.

Plaintiff does not address or oppose Defendants’ arguments regarding general jurisdiction and,

instead, limits its argument to the issue of specific personal jurisdiction. Thus, the Court will assume,

for purposes of the instant Motion, that general jurisdiction does not exist and will limit its analysis

to the question of whether Plaintiff has made a prima facie showing of specific jurisdiction over

Defendants Messina and Tamayo.

In making this determination, “the crucial federal constitutional inquiry is whether, given the

facts of the case, the nonresident defendant has sufficient contacts with the forum state that the district

court's exercise of jurisdiction would comport with ‘traditional notions of fair play and substantial

justice.’” International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95

(1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 342–43, 85 L.Ed. 278 (1940)).

See also CompuServe, 89 F.3d at 1263; Theunissen, 935 F.2d at 1459. The Sixth Circuit has

established the following three-part test for determining whether specific personal jurisdiction exists:

First, the defendant must purposefully avail himself of the privilege of acting in the

forum state or causing a consequence in the forum state. Second, the cause of action

19

must arise from the defendant's activities there. Finally, the acts of the defendant or

consequences caused by the defendant must have a substantial enough connection with

the forum to make the exercise of jurisdiction over the defendant reasonable.

CompuServe, Inc., 89 F.3d at 1263. See also Calphalon v. Rowlette, 228 F.3d 718, 721 (6th Cir.

2000); Southern Mach. Co. v. Mohasco Indus., 401 F.2d 374, 381 (6th Cir. 1968).

1. Purposeful Availment

The question of whether a defendant has purposefully availed itself of the privilege of doing

business in the forum state is “the sine qua non for in personam jurisdiction.” Mohasco Indus., 401

F.2d at 381–82. See also Calphalon, 228 F.3d at 721 (“The purposeful availment prong . . . is

essential to a finding of personal jurisdiction.”) The “purposeful availment” requirement is satisfied

when the defendant's contacts with the forum state “proximately result from actions by the defendant

himself that create a ‘substantial connection’ with the forum State,” and when the defendant's conduct

and connection with the forum are such that he “should reasonably anticipate being haled into court

there.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474–75, 105 S.Ct. 2174, 2183–84, 85 L.Ed.2d

528 (1985) (quoting World–Wide Volkswagen v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567,

62 L.Ed.2d 490 (1980)); Reynolds v. International Amateur Athletic Fed’n, 23 F.3d 1110, 1116 (6th

Cir. 1994). Courts require purposeful availment to insure that “random,” “fortuitous,” or “attenuated”

contacts do not cause a defendant to be haled into a jurisdiction. Burger King Corp., 471 U.S. at 475

(citing Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 774, 104 S.Ct. 1473, 1478, 79 L.Ed.2d 790

(1984)).

Defendants argue that they did not purposefully avail themselves of the privilege of

conducting business in Ohio, noting that Plaintiff has failed to demonstrate any connection between

Defendants’ business activities and this State. (Doc No. 17-1 at p. 12-14, Doc. No. 20-1 at p. 12.)

20

Defendants further maintain that the mere fact that they signed contracts with an Ohio corporation

and were then paid by that entity is not sufficient to establish purposeful availment. (Id.) They

maintain that they do not have the type of regular or continuous contacts with Ohio that would support

a finding of personal jurisdiction, particularly given that all of Defendants’ alleged conduct at issue

in the Complaint was committed in Illinois. (Doc. No. 34 at pp. 13-14.) In sum, Defendants argue

jurisdiction is not appropriate because “Plaintiff recruited and hired defendants who each hold an

Illinois license as Illinois-based mortgage loan originators to generate mortgage loans in Illinois from

an Oak Brook, Illinois location, pursuant to Illinois laws and with Illinois borrowers, and alleges in

the Complaint that defendant used the Illinois borrower data to compete against it in Illinois.” (Id. at

p. 15.)

Plaintiff argues Defendants’ contacts with Ohio satisfy the purposeful availment prong

because both Messina and Tamayo (1) knew they were establishing an employment relationship with

an Ohio company; (2) were paid from Ohio; (3) used resources (such as marketing materials and a

customer information database) provided from Ohio; and (4) continue to be bound by the non-

competition, non-solicitation, and confidentiality obligations set forth in their respective Employment

Agreements. (Doc. No. 31 at p. 16, Doc. No. 35 at p. 16.) Moreover, Plaintiff notes that both Messina

and Tamayo “reached into Ohio to steal confidential information from CrossCountry’s Ohio-based

databases, and communicated with an Ohio citizen, CrossCountry’s CEO, for the purpose of causing

tortious injury (the conversion of funds) to CrossCountry, an Ohio resident.” (Doc. No. 35 at p. 16.)

For the following reasons, the Court finds that Plaintiff has demonstrated that Defendants

purposefully availed themselves of the privilege of acting in Ohio. The Supreme Court has

“emphasized that parties who ‘reach out beyond one state and create continuing relationships and

21

obligations with citizens of another state’ are subject to regulation and sanctions in the other State for

the consequences of their activities.” Burger King, 471 U.S. at 473. Here, Plaintiff has come forward

with evidence that Defendants Messina and Tamayo “reached out” to Ohio when they applied for

positions with an Ohio corporation and executed Employment Agreements that included continuing

and ongoing non-competition, non-solicitation, and confidentiality obligations. In addition, Plaintiff

has submitted evidence that Defendant Messina routinely communicated with and took instruction

from Mr. Leonhardt and Mr. Montgomery (both of whom were based in Ohio) and traveled to Ohio

on at least one occasion. (Stracensky Decl. I at ¶¶ 2, 4, 5.) Defendant Tamayo also regularly

communicated with Plaintiff in Ohio when he submitted requests for approval of business expenses

to Plaintiff’s Ohio headquarters. (Stracensky Decl. II at ¶ 5.) Moreover, both Defendants allegedly

accessed Plaintiff’s confidential information from its Ohio-based computer system and misused that

information in order to divert Plaintiff’s customers to Parkside Lending.7 (Stracensky Decl. I at ¶ 11;

Stracensky Decl. II at ¶ 8.)

Several courts in this Circuit have found the purposeful availment prong satisfied under

similar circumstances. For example, in The Rightthing, LLC, supra, the Court found the purposeful

availment prong met where the defendants actively used plaintiff’s Ohio-based computer system to

misappropriate plaintiff’s trade secrets:

With regard to the [purposeful availment] prong, [Defendant] Brown argues that she

simply represented [Plaintiff] RTI in California and that her association with Ohio was

attenuated because it just so happened that RTI's principal place of business was in

Ohio. The Court disagrees. Notwithstanding the disputed Agreement in this case, RTI

has alleged that Brown removed files, that allegedly contained trade secrets, from

RTI's Ohio-based database. In doing so, Brown, reached the State of Ohio through her

7 In addition, while not dispositive, the Court notes that the Employment Agreements at issue contain a choice of law

provision that “this Agreement shall be governed by and construed in accordance with the substantive laws of Federal

law and the laws of the State of Ohio.” (Messina Agreement at § 6.7; Tamayo Agreement at § 5.7).

22

computer wires, removed the files from RTI's computer system, and returned them to

California. Furthermore, Brown regularly received files from Ohio and accessed RTI's

Ohio-based computer system.

The Rightthing, Inc., 2009 WL 249694 at * 5. See also Allow Bellows & Precision Welding, Inc.,

2015 WL 6964579 at * 5 (finding purposeful availment prong met where former employee “reached

in to Ohio by contracting in Ohio, the substance of which created continuing obligations not to

compete or disclose confidential of Plaintiff” and subsequently “reached into Ohio to copy

confidential files, allegedly violating the terms of the Agreements”); International Paper Co, 872

F.Supp.2d at 632 (finding this prong met where former employee entered into a confidentiality

agreement with employer, communicated with Ohio-based employees, and maintained access to a

password protected website containing employer’s confidential information).

For this reason, Defendants’ reliance on Calphalon v. Rowlette, 228 F.3d 718 (6th Cir. 2000)

is misplaced. In that case, the Sixth Circuit found the defendant (a sales representative for Calphalon

cookware products) lacked sufficient minimum contacts with Ohio to permit the exercise of personal

jurisdiction by an Ohio court under the due process clause. Calphalon, 228 F.3d at 723. There,

defendant executed one-year manufacturer’s representative agreements with Calphalon in 1996 and

1997 to promote the sale of Calphalon’s products and keep Calphalon informed of market conditions.

Defendant’s sales territories were Minnesota, Iowa, North Dakota, South Dakota, and Nebraska.

During the term of the agreements, defendant made two visits to Ohio and communicated with

Calphalon in Ohio via telephone, fax, and mail. The Sixth Circuit found no purposeful availment

because defendant’s performance of the agreement was “not focused on exploiting any market for

cookware in the State of Ohio.” Id. at 723.

23

In the instant case, Defendants reached into Ohio by contracting with an Ohio corporation and

agreeing to be bound by the continuing non-competition, non-solicitation, and confidentiality

obligations set forth in their respective Employment Agreements. Moreover, both Defendants

directed activity into Ohio by communicating with Plaintiff in Ohio, accessing Plaintiff’s confidential

information from its Ohio computer database, and allegedly misappropriating Plaintiff’s confidential

information to divert Plaintiff’s customers to Parkside. Thus, the Court finds the quality and nature

of Defendants’ contacts with Plaintiff in Ohio are distinguishable from those of the defendant in

Calphalon and support a finding of purposeful availment. See also Dayton Superior, 288 F.R.D. at

168 (distinguishing Calphalon by noting that “in this case, the allegations, among others, involve

misappropriation of trade secrets from an Ohio company”); Alloy Bellows & Precision Welding, 2015

WL 6964579 at * 5 (“The instant case can be distinguished from Calphalon as Cole reached into

Ohio by contracting in Ohio,” agreeing not to disclose confidential information, and subsequently

“reach[ing] into an Ohio-based computer system to extract the confidential information”).

Accordingly, and for all the reasons set forth above, the Court finds Plaintiff has demonstrated

that Defendants purposefully availed themselves of the privilege of acting in Ohio or causing a

consequence in this State.

2. Arising From

The second factor in evaluating specific jurisdiction requires that a cause of action “arise

from” the defendant's activities in the forum state. Mohasco Indus., Inc., 401 F.2d at 381. This

requirement is satisfied when “the cause of action, of whatever type, ha[s] a substantial connection

with the defendant's in-state activities.” Kerry Steel, Inc., 106 F.3d at 152 (quotation marks omitted).

“'Only when the operative facts of the controversy are not related to the defendant's contact with the

24

state can it be said that the cause of action does not arise from that contract.”' Calphalon Corp., 228

F.3d at 723–24 (quoting Mohasco Indus., Inc., 401 F.2d at 384 n.29). The Sixth Circuit has also

stated that a “lenient standard . . . applies when evaluating the arising from criterion.” Bird v. Parsons,

289 F.3d 865, 875 (6th Cir. 2002).

The Court finds Plaintiff has satisfied the “arising from” requirement for establishing specific

jurisdiction. In this case, Plaintiff has alleged (among other things) that Defendants improperly used

Plaintiff’s confidential customer information to divert CrossCountry’s customers and business to

Parkside. Plaintiff alleges that Defendants accomplished this by accessing the confidential

information stored on Plaintiff’s computer data base, which it alleges is maintained and managed by

CrossCountry IT personnel in Ohio. (Stracensky Decl. I at ¶ 11; Stracensky Decl. II at ¶ 8.) The

Court finds that this alleged conduct is directly related to Plaintiff’s breach of contract, breach of

fiduciary duty, conspiracy, and misappropriation claims and, therefore, satisfies the “arising from”

requirement.

The Court further finds that Plaintiff’s conversion claim “arises from” Defendants’ alleged

conduct in Ohio. Defendants allegedly reached out to Mr. Leonhardt in Ohio (via email and phone

by Messina, and via phone only by Tamayo) to request bonuses, knowing that they were leaving

CrossCountry and with the intent to use the bonus money for the benefit of Parkside. CrossCountry

alleges that Defendants conspired to obtain this money from CrossCountry under false pretenses in

order to aid their transition to Parkside. (Stracensky Decl. II at ¶ 10.) The Court finds that this alleged

conduct is directly related to Plaintiff’s conversion claim and is sufficient to satisfy the “arising from”

requirement with respect to that claim.

25

Accordingly, the Court finds Plaintiff’s claims “arise out of” Defendants’ alleged contacts

with the State of Ohio.

3. Reasonableness

The third, and final, factor requires that “the acts of the defendant or consequences caused by

the defendant must have a substantial enough connection with the forum state to make the exercise

of jurisdiction over the defendant reasonable.” Mohasco Indus., Inc., 401 F.2d at 381. The exercise

of jurisdiction is presumed to be reasonable when the plaintiff satisfies the first two prongs of the

Mohasco analysis. CompuServe, 89 F.3d at 1268. “[W]hen considering whether it is reasonable to

exercise personal jurisdiction over a non-resident defendant, a court must consider several factors

including the following: (1) the burden on the defendant, (2) the interest of the forum state, (3) the

plaintiff's interest in obtaining relief, and (4) other states' interest in securing the most efficient

resolution of the controversy.” Intera Corp., 428 F.3d at 618.

Defendants argue that it would impose a “significant burden” on them to defend this action in

Ohio given the fact that they both live in and conduct their business exclusively in Illinois. (Doc. No.

17-1 at p. 17; Doc. No. 20-1 at p. 16.) They further assert that Ohio’s interest is “nonexistent.” (Id.)

The Court finds this is not the “unusual case” in which the exercise of personal jurisdiction is

unreasonable. Mohasco, 401 F.2d at 384. Defendants provide no specific facts or other particular

support for their contention that litigating this matter in Ohio would be substantially burdensome.

Moreover, the Court finds that Ohio has a strong interest in ensuring the enforcement of its laws and

enforcing contracts entered into by Ohio-based businesses. See Tarkett USA, 2017 WL 2443139 at

* 6; International Paper, 872 F.Supp.2d at 633. While it may be somewhat burdensome for

Defendants to defend suit in Ohio, when they entered into Employment Agreements with an Ohio

26

corporation, they knew that they were “making a connection with Ohio, and presumably hoped that

connection would work to [their] benefit.” CompuServe, 89 F.3d at 1268.

Therefore, the Court finds the exercise of personal jurisdiction over Defendants is reasonable.

IV. Conclusion

Accordingly, and for all the reasons set forth above, Defendants’ Motions to Dismiss for Lack

of Personal Jurisdiction (Doc. Nos. 17, 20) are DENIED.

IT IS SO ORDERED.

s/Pamela A. Barker

PAMELA A. BARKER

Date: October 31, 2019 U. S. DISTRICT JUDGE

27