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Ford Robinson Partnership v. Wells Fargo Clearing Services, LLC

United States District Court, D. Nebraska

March 20, 2018

FORD ROBINSON PARTNERSHIP, Plaintiff,
v.
WELLS FARGO CLEARING SERVICES, LLC; HOLLIS LORENZO MAXFIELD; ALPHA E ANGEL, LLC; MIKE BARBEE; MIKE BARBEE d/b/a FIRST MUTUAL FUNDING; GERALD LEWIS; and 4 HORSEMEN, LLC, Defendants.

          MEMORANDUM AND ORDER

          Robert F. Rossiter, Jr. United States District Judge.

         This matter is before the Court on defendant Wells Fargo Clearing Services, LLC's (“Wells Fargo”) Motion to Dismiss, or in the Alternative, to Transfer Venue (Filing No. 6). For the reasons stated below, the Motion is granted in part and denied in part, and plaintiff Ford Robinson Partnership's (“Ford Robinson”) Second Amended Complaint (Filing No. 1-1, pp. 71-74) is dismissed as to Wells Fargo.

         I. BACKGROUND

         Ford Robinson, a Nebraska partnership, desired $6, 000, 000 in funding to acquire Techota, LLC (“Techota”), a home-healthcare business located in Alabama. On September 2, 2016, Mike Barbee (“Barbee”), an individual associated with the Texas entity First Mutual Funding (“First Mutual”), contacted Ford Robinson about providing the funding. Barbee represented that he; Hollis Lorenzo Maxfield (“Maxfield”), an “employee or agent” of Alpha E Angel, LLC (“Angel”), a Texas company; and Gerald Lewis (“Lewis”), an “employee or agent” of Wells Fargo, would be able to obtain $6, 000, 000 in financing for Ford Robinson.[1]

         Ford Robinson and Maxfield executed a Wells Fargo Advisor Limited Liability Company Authorization, and Lewis opened a brokerage account at Wells Fargo that Maxfield and Ford Robinson allegedly could only use with joint signatures. On September 29, 2015, Ford Robinson deposited $99, 962 into the account. On November 19, 2015, Maxfield withdrew the money from the brokerage account. Maxfield apparently cannot be found.

         On December 12, 2017, Ford Robinson filed its Second Amended Complaint (Filing No. 1-1, pp. 71-74) in the District Court of Douglas County, Nebraska, alleging one count of fraudulent misrepresentation against Maxfield, Angel, Barbee, First Mutual, 4 Horsemen, LLC, [2] Lewis, and Wells Fargo. Citing diversity jurisdiction, Wells Fargo removed the case to federal court on January 5, 2018. See 28 U.S.C. §§ 1332, 1441, and 1446. Wells Fargo filed the present Motion on January 12, 2018.

         II. DISCUSSION

         Wells Fargo seeks dismissal of the Complaint against it for failure to state a claim and lack of personal jurisdiction, or, in the alternative, to transfer the case to the United States District Court for the Northern District of Texas where personal jurisdiction allegedly exists. See Fed. R. Civ. P. 12(b)(2) and (6); 28 U.S.C. §1404(a).[3]

         Wells Fargo and Ford Robinson have each filed Indexes (Filing Nos. 8 and 14) of evidence that mainly relate to the issue of personal jurisdiction. “When personal jurisdiction is challenged by a defendant, the plaintiff bears the burden to show that jurisdiction exists.” Fastpath, Inc. v. Arbela Techs. Corp., 760 F.3d 816, 820 (8th Cir. 2014). The Court doubts Ford Robinson has met this burden because its evidence points only to the fact that Wells Fargo is registered to do business in Nebraska and does business in the State, nothing more. However, due to the confusing and opaque nature of the Second Amended Complaint (and the Brief in Opposition to Defendant's Motion to Dismiss or Transfer Venue), [4] the Court will assume only for the purpose of the pending Motion that jurisdiction exists, and will proceed to analyze the clearer issue - whether Ford Robinson has stated a claim against Wells Fargo.[5]

         A. Choice of Law

         In its brief, Wells Fargo raised the issue of choice of law. “A district court sitting in diversity must apply the conflict of law rules for the state in which it sits.” Inacom Corp. v. Sears, Roebuck & Co., 254 F.3d 683, 687 (8th Cir. 2001). “In choice-of-law determinations, [the Nebraska Supreme Court] often seek[s] guidance from the Restatement (Second) of Conflict of Laws.” Erickson v. U-Haul Int'l, 767 N.W.2d 765, 772 (Neb. 2009); accord Inacom, 254 F.3d at 687 (“In deciding choice of law questions, Nebraska follows the Restatement (Second) of Conflict of Laws.”). Section 148 of the Restatement governs the tort of fraudulent misrepresentation.

         The Court determines Nebraska law applies because Nebraska is (1) “the place . . . where [Ford Robinson] acted in reliance upon the defendant[s'] representations, ” (2) “the place where [Ford Robinson] received the representations, ” and (3) the “residence . . . and place of business” of Ford Robinson.[6] Restatement (Second) of Conflict of Laws § 148(2) (1971).

         B. Failure to State a Claim

         “To survive a motion to dismiss for failure to state a claim, a plaintiff must plead ‘enough facts to state a claim to relief that is plausible on its face.'” Roe v. Nebraska, 861 F.3d 785, 787 (8th Cir. 2017) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim is facially plausible when it alleges facts that allow the court to ‘draw the reasonable inference that the ...


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