Aloia v. Biological Resource ( 2022 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
GWENDOLYN ALOIA, et al.,
Plaintiffs/Appellants/Cross-Appellees,
v.
BIOLOGICAL RESOURCE CENTER OF ILLINOIS, LLC, et al.,
Defendants/Appellees/Cross-Appellants.
No. 1 CA-CV 20-0243
FILED 4-28-2022
Appeal from the Superior Court in Maricopa County
No. CV2015-013391
The Honorable Timothy J. Thomason, Judge
AFFIRMED
COUNSEL
Burg Simpson Eldredge Hersh & Jardine PC, Phoenix
By Michael S. Burg, David K. TeSelle, Taylor C. Young, Paul D. Friedman,
Holly Kammerer
Counsel for Plaintiffs/Appellants/Cross-Appellees
Stephenson & Stephenson Ltd., Barrington Hills, IL
By Robert Stephenson
Counsel for Defendants/Appellees/Cross-Appellants
ALOIA, et al. v. BIOLOGICAL RESOURCE, et al.
Decision of the Court
MEMORANDUM DECISION
Chief Judge Kent E. Cattani delivered the decision of the Court, in which
Judge Samuel A. Thumma and Judge Jennifer M. Perkins joined.
C A T T A N I, Chief Judge:
¶1 Thirty-five individual plaintiffs sued the Arizona-based
Biological Resource Center, Inc. (“BRC Inc.”) and its principals, Stephen
Gore and his wife (collectively, the “Arizona Defendants”); the Illinois-
based Biological Resource Center Illinois, LLC (“BRCIL”) and its principals,
Donald A. Greene and Donald Greene II (collectively, the “Illinois
Defendants”); and several other defendants in Maricopa County Superior
Court for claims stemming from what the plaintiffs characterized as a
nationwide “illegal ‘body broker’ enterprise” perpetrated through a willed-
body donation program. The superior court granted the Illinois Defendants
summary judgment, dismissing the claims against them based on Arizona’s
lack of personal jurisdiction.
¶2 Twelve plaintiffs—Gwendolyn Aloia, Nancy Culver, Erica
Elam-Prewitt, Troy Harp, Phyllis Meadows, Anastacia Moore, Helen
Peterson, Donna Rector, Mary Salinas, Gwen Timmerman, Suzanne Visser,
and Richelle Wallace (collectively, “Appellants”)—appealed from the
judgment of dismissal. The Illinois Defendants cross-appealed, asserting
that the Appellants failed to timely appeal from the proper Rule 54(b)
judgment and, alternatively, that several of the individual Appellants
should be dismissed from the appeal for other reasons. For reasons that
follow, we affirm.
FACTS AND PROCEDURAL BACKGROUND
¶3 BRC Inc. was an Arizona corporation, founded in 2003 and
owned by Stephen Gore and his wife, that operated a willed-body donation
program. BRCIL was formed several years later in Illinois. Greene was its
sole member and manager, Greene II was its director of operations, and
both of them resided in Illinois.
¶4 In 2007, BRC Inc. and BRCIL entered a distribution agreement
under which BRC Inc. supplied donated tissue and specimens from
Arizona whole-body donors and BRCIL organized distribution to qualified
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recipients outside the state of Arizona for research and educational use.
The agreement—which characterized the relationship between BRC Inc.
and BRCIL as one of “supplier–distributor,”—contemplated that BRCIL
would accept tissue requests from research and educational organizations
outside of Arizona, then notify BRC Inc. of the requests. BRC Inc. would
supply the requested tissue either directly to the requesting organization or
indirectly through BRCIL, and the recipient would make payment through
BRCIL, which retained a distribution fee before forwarding the balance on
to BRC Inc. Among other contract terms, BRC Inc. warranted that it
received “lawful and valid informed consent” for all donations and that all
tissue was obtained in compliance with applicable law.
¶5 This lawsuit was filed in Maricopa County Superior Court in
2015. After amendments and the addition of several plaintiffs, the
operative complaint asserted that defendants in four states1 had
perpetrated a “national criminal enterprise and civil conspiracy . . . in the
trafficking, wrongful use, and illegal purchase and sale for profit of dead
human bodies and body parts.” The various plaintiffs asserted different
combinations of claims including violations of the Arizona and Illinois
Consumer Fraud Acts, common law fraud, intentional infliction of
emotional distress, intentional mishandling of dead bodily remains, civil
conspiracy, racketeering, and aiding and abetting of the other listed torts.
Despite the variety of claims asserted against various defendants, each
claim rested on the core premise that the plaintiffs were led to believe that
their deceased family members’ bodies “would be treated ‘with honesty,
respect and dignity’, and would be used for important medical research
projects,” but instead the donated remains were mishandled and sold for
profit against donor wishes.
¶6 Ten of the Appellants—Aloia, Culver, Harp, Meadows,
Peterson, Rector, Salinas, Timmerman, Visser, and Wallace—asserted
claims involving the remains of Arizona residents who passed away in
Arizona and donated their bodies to BRC Inc. in Arizona, and all but one of
these plaintiffs were themselves Arizona residents. During discovery, these
Arizona plaintiffs recalled no communication with any of the Illinois
Defendants, and discovery showed that BRCIL had nothing to do with the
donation process for these (or any) Arizona-based anatomical donations.
1 In addition to the Arizona Defendants and the Illinois Defendants,
the complaint named as defendants Michigan-based International
Biological, Inc., and its principals, Arthur and Elizabeth Rathburn; and
Nevada-based Platinum Training, LLC and related entities with their
principals, Charles and Amy Oddo.
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The other two Appellants—Elam-Prewitt and Moore—were Illinois
residents whose claims involved the remains of Illinois residents who
passed away in Illinois and donated their bodies to BRCIL in Illinois.
¶7 Early on, the Illinois Defendants filed a Rule 12 motion to
dismiss for lack of personal jurisdiction. See Ariz. R. Civ. P. 12(b)(2). Given
the procedural posture of the case, the court denied the motion. The court
noted (but did not then resolve) the operative complaint’s theory that
BRCIL and Arizona-based BRC Inc. were alter egos of each other, and the
court reasoned that the complaint’s allegations of the Illinois Defendants’
“participation, ratification, or consent to” Arizona-based activity sufficed to
defeat the motion.
¶8 Later, after close of discovery, the Illinois Defendants moved
for summary judgment, arguing that Arizona lacked personal jurisdiction
over them. The plaintiffs opposed, asserting that (1) BRCIL was an alter
ego of Arizona-based BRC Inc. and thus subject to general jurisdiction in
Arizona, and (2) BRCIL was subject to specific jurisdiction in Arizona
because it purposely targeted Arizona through its years-long business
relationship with BRC Inc., in which BRCIL distributed tissue from the
bodily remains of Arizona decedents. The superior court granted the
Illinois Defendants’ motion. The court concluded that BRCIL was not
subject to general jurisdiction because the evidence showed BRC Inc. and
BRCIL to be “separate and independent,” not alter egos, and that specific
jurisdiction was also absent because none of BRCIL’s forum activities gave
rise to the plaintiffs’ claims.
¶9 In March 2019, the court signed a judgment dismissing the
Illinois Defendants from the action based on the summary judgment ruling.
Although this 2019 judgment affirmed that it resolved all claims against the
Illinois Defendants and cited Rule 54(b), it did not include an express
determination that “there is no just reason for delay.” See Ariz. R. Civ. P.
54(b). Appellants did not attempt to appeal from the 2019 judgment, and
litigation continued against other defendants.
¶10 Almost a year later, the plaintiffs moved for entry of “a Rule
54(b) compliant judgment”—one including an express determination of no
just reason for delay. Over the Illinois Defendants’ objection, the superior
court agreed that the 2019 judgment was not final without that
determination, and in March 2020, the court entered a final Rule 54(b)
judgment dismissing the Illinois Defendants, this time with an express
determination of no just reason for delay.
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Decision of the Court
¶11 Appellants timely appealed the 2020 judgment, and the
Illinois Defendants timely cross-appealed. We have jurisdiction under
A.R.S. § 12-2101(A)(1).
DISCUSSION
I. Preliminary Matters.
¶12 The Illinois Defendants’ cross-appeal raises issues bearing on
the propriety and appropriate scope of the appeal. First, they urge that the
2019 judgment was final and appealable when entered, which, if true,
would mean Appellants’ notice of appeal was untimely and we lack
appellate jurisdiction. Second, they assert that, due to subsequent rulings
in the litigation, some of the Appellants lack any basis to appeal the
dismissal. We address each contention in turn.
A. Appellate Jurisdiction.
¶13 The Illinois Defendants assert that the superior court erred by
concluding the 2019 judgment was not final under Rule 54(b), and thus that
the court’s entry of the 2020 judgment was improper and could not properly
reopen the time for Appellants to appeal. We review de novo the court’s
determination as to finality of the 2019 judgment. See Madrid v. Avalon Care
Ctr.-Chandler, L.L.C., 236 Ariz. 221, 223, ¶ 3 (App. 2014); see also Kim v.
Mansoori, 214 Ariz. 457, 459, ¶ 6 (App. 2007).
¶14 Generally, our appellate jurisdiction “is limited to final
judgments which dispose of all claims and all parties.” Musa v. Adrian, 130
Ariz. 311, 312 (1981) (noting the general rule against piecemeal appeals); see
also A.R.S. § 12-2101(A)(1); Ariz. R. Civ. P. 54(c). Under Rule 54(b),
however, the superior court may certify certain otherwise-partial rulings as
final, immediately appealable judgments:
If an action presents more than one claim for relief . . . or if
multiple parties are involved, the court may direct entry of a
final judgment as to one or more, but fewer than all, claims or
parties only if the court expressly determines there is no just
reason for delay and recites that the judgment is entered
under Rule 54(b).
Ariz. R. Civ. P. 54(b); see also, e.g., Madrid, 236 Ariz. at 224, ¶¶ 7–8.
¶15 To qualify for Rule 54(b) certification, the ruling must in fact
dispose of at least one claim or one party. See Musa, 130 Ariz. at 313; Davis
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v. Cessna Aircraft Corp., 168 Ariz. 301, 304 (App. 1991). And—not least as a
means to clarify appealability of a ruling that would not otherwise be
appealable, see Stevens v. Mehagian’s Home Furnishings, Inc., 90 Ariz. 42, 44
(1961)—the rule requires an “express determination” of no just reason for
delay and a recital of entry pursuant to Rule 54(b). Absent either of those
elements, the ruling remains interlocutory and is not yet appealable:
If there is no such express determination and recital, any
decision, however designated, that adjudicates fewer than all
the claims or the rights and liabilities of fewer than all the
parties does not end the action as to any of the claims or
parties and may be revised at any time before the entry of a
judgment adjudicating all the claims and all the parties’ rights
and liabilities.
Ariz. R. Civ. P. 54(b); see also Stevens, 90 Ariz. at 44–45 (noting that the rule
requires “the determination and direction,” else the judgment is not final
and not immediately appealable); Maria v. Najera, 222 Ariz. 306, 307, ¶ 6
(App. 2009); Pulaski v. Perkins, 127 Ariz. 216, 217 (App. 1980) (reiterating
that “the lack of a 54(b) determination defeats finality”); cf. Grand v. Nacchio,
214 Ariz. 9, 16, ¶ 17 & n.3 (App. 2006) (suggesting, in dicta, that a statement
of “no just reason for delay” and direction to enter judgment would qualify
even without direct citation to Rule 54(b)).
¶16 Here, the superior court’s summary judgment ruling on
personal jurisdiction resolved all claims against the Illinois Defendants and
thus potentially qualified for 54(b) certification. And the form of judgment
submitted by the Illinois Defendants and signed by the superior court in
March 2019 invoked entry under 54(b): “Pursuant to Rule 54(b), this
Judgment is to all claims between Plaintiffs and the Illinois Defendants
only, and there are no further matters that remain pending between
Plaintiffs and the Illinois Defendants.” But it did not include an express
determination of no just reason for delay. See Ariz. R. Civ. P. 54(b). Without
any such express determination, the ruling was not final and appealable.
¶17 The Illinois Defendants assert to the contrary that including
the phrase “no just reason for delay” is neither necessary nor sufficient for
a judgment to be final and immediately appealable under Rule 54(b). They
posit instead that a qualifying ruling (here, a ruling that fully resolved the
claims against particular parties, even though claims against others
remained outstanding) coupled with an intent to enter a partial final
judgment under 54(b) judgment is all that is required. See, e.g., Kelly v. Lee’s
Old Fashioned Hamburgers, Inc., 908 F.2d 1218, 1220 (5th Cir. 1990).
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¶18 Both of those elements—that the ruling dispose of at least one
claim or party, and that the court “recite[] that the judgment is entered
under Rule 54(b)”—are required by the text of the rule. Ariz. R. Civ. P.
54(b); see, e.g., Musa, 130 Ariz. at 313; Stevens, 90 Ariz. at 44–45. But the rule
also explicitly requires that the court “expressly determine[] there is no just
reason for delay.” Ariz. R. Civ. P. 54(b). The Illinois Defendants’ intent-
only-based interpretation runs contrary to the stated requirement of an
“express” determination. See Ruben M. v. Ariz. Dep’t of Econ. Sec., 230 Ariz.
236, 240, ¶ 20 (App. 2012) (noting that, because a rule’s language is the best
indication of its meaning, we “give effect to each word, phrase and clause
included by the supreme court”) (citation omitted).
¶19 Even though the superior court may have intended the 2019
judgment to be immediately appealable, without the requisite “express
determination” it was not. Ariz. R. Civ. P. 54(b); see also Stevens, 90 Ariz. at44–45; Madrid, 236 Ariz. at 224, ¶ 8. Because that ruling remained
interlocutory, the court properly granted the plaintiffs’ subsequent request
for “a Rule 54(b) compliant judgment” of dismissal. The resulting 2020
judgment included the necessary express determination of no just reason
for delay and recital that judgment was entered under Rule 54(b), and thus
it was immediately appealable. See Madrid, 236 Ariz. at 224, ¶ 8. Appellants
timely appealed thereafter, so we have appellate jurisdiction under A.R.S.
§ 12-2101(A)(1). See also ARCAP 9(a).
B. Proper Appellants.
1. Illinois Plaintiffs.
¶20 The Illinois Defendants argue that the appeal should be
dismissed as to Elam-Prewitt and Moore (the two Appellants from Illinois)
because they were no longer parties to the underlying case by the time of
the 2020 judgment. Appellants did not address this argument in their
responsive brief. Although we could deem this omission a confession of
error, we decline to do so because the issue is not debatable. See Savord v.
Morton, 235 Ariz. 256, 259, ¶ 9 (App. 2014); Bulova Watch Co. v. Super City
Dep’t Stores of Ariz., Inc., 4 Ariz. App. 553, 556 (App. 1967).
¶21 Several months after the superior court’s summary judgment
ruling in favor of the Illinois Defendants, the plaintiffs proceeded to trial
against defendant Stephen Gore. During trial, Gore moved to dismiss
Elam-Prewitt and Moore’s claims against him. The court granted the
motion and, in January 2020, entered judgment in Gore’s favor dismissing
those claims.
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¶22 The Illinois Defendants suggest that at that point (which was
before entry of the appealable 2020 judgment dismissing the claims against
the Illinois Defendants), Elam-Prewitt and Moore “were not parties to this
case” and thus could not file an appeal. But the judgment for Gore
dismissed Elam-Prewitt and Moore’s claims against Gore, not their claims
against the Illinois Defendants. Their claims against the Illinois Defendants,
although substantively resolved by the summary judgment ruling on
personal jurisdiction, had not been reduced to a final, appealable judgment
until the 2020 judgment from which Appellants (including Elam-Prewitt
and Moore) timely appealed. Accordingly, we deny the Illinois
Defendants’ request to dismiss the appeal as to these two Appellants.
2. No-Liability Plaintiffs.
¶23 The Illinois Defendants next argue that the appeal should be
dismissed as to Meadows, Peterson, Rector, Salinas, Visser, and Wallace
because the jury returned verdicts against these six. The Illinois Defendants
assert that the claims against them were premised solely on vicarious
liability for wrongdoing by Gore and BRC Inc., so the jury verdicts in Gore’s
favor—from which these six did not appeal—moot the appeal as to these
six Appellants. Appellants again failed to address this argument in their
responsive brief, but the issue is not debatable, so we decline to construe
this omission as a confession of error. See Savord, 235 Ariz. at 259, ¶ 9; Bulova
Watch, 4 Ariz. App. at 556.
¶24 At trial, Gore secured defense verdicts against Meadows,
Peterson, Rector, Salinas, Visser, and Wallace on their remaining claims
against him. These verdicts could not, however, have resolved all claims
against the Illinois Defendants because the complaint alleged claims for
direct, not just vicarious, liability against them. See Ford v. Revlon, Inc., 153
Ariz. 38, 42 (1987). And in any case, the verdicts were in favor of Gore only,
not BRC Inc.; the plaintiffs obtained a default judgment in their favor
against BRC Inc. Accordingly, we deny the Illinois Defendants’ request to
dismiss the appeal as to these six Appellants.
II. Personal Jurisdiction.
¶25 Appellants challenge the superior court’s ruling granting the
Illinois Defendants summary judgment and dismissing the claims against
them for lack of personal jurisdiction. We review this ruling de novo. See
A. Uberti & C. v. Leonardo, 181 Ariz. 565, 566–67, 569 (1995); Ariz. Tile, L.L.C.
v. Berger, 223 Ariz. 491, 493, ¶ 8 (App. 2010).
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¶26 Arizona’s long-arm rule permits exercise of personal
jurisdiction to the greatest extent allowed under the United States
Constitution. Ariz. R. Civ. P. 4.2(a); Plan. Grp. of Scottsdale, L.L.C. v. Lake
Mathews Min. Props., Ltd., 226 Ariz. 262, 265, ¶ 12 (2011). The test for
personal jurisdiction considers whether a defendant has “sufficient
minimum contacts with the forum state such that the maintenance of the
suit does not offend traditional notions of fair play and substantial justice,”
Williams v. Lakeview Co., 199 Ariz. 1, 3, ¶ 6 (2000) (citing Int’l Shoe Co. v.
Washington, 326 U.S. 310, 320 (1945)), and thus hinges on “the nature and
extent of ‘the defendant’s relationship to the forum State,’” Ford Motor Co.
v. Mont. Eighth Jud. Dist. Ct., 141 S. Ct. 1017, 1024 (2021) (quoting Bristol-
Myers Squibb Co. v. Superior Ct. of Cal., S.F. Cnty., 137 S. Ct. 1773, 1779 (2017)).
¶27 Personal jurisdiction may be either general or specific. Plan.
Grp., 226 Ariz. at 265, ¶ 13. Arizona may exercise general jurisdiction—that
is, jurisdiction to hear any claim against a defendant, regardless whether
the claim relates to the forum or the defendant’s activities there—over
resident defendants and those whose contacts are so substantial they are
“essentially at home” in the forum state. Ford, 141 S. Ct. at 1024 (quoting
Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)); see
also Plan. Grp., 226 Ariz. at 265, ¶ 13; Williams, 199 Ariz. at 3, ¶ 6. For
corporations, this generally means the state(s) of incorporation and
principal place of business. Ford, 141 S. Ct. at 1024.
¶28 In superior court, the plaintiffs asserted that BRCIL was
subject to general jurisdiction in Arizona as an alter ego of BRC Inc., an
Arizona corporation. They highlighted statements to third-parties
presenting the two as being parts of the same organization, as well as
regular communications between the two to coordinate inventory and
distribution. The superior court acknowledged that those statements
“suggest[ed] some type of partnership or affiliation” between BRCIL and
BRC Inc., but it found no evidence that the one entity controlled the other.
See Gatecliff v. Great Republic Life Ins. Co., 170 Ariz. 34, 37 (1991). Instead, the
undisputed evidence showed the two were operated independently with
separate corporate records and funds, without officers or shareholders in
common and without joint management. The court thus concluded the two
were not alter egos and that there was no basis for general jurisdiction.
Appellants do not challenge this facet of the ruling on appeal, so it remains
final.
¶29 Specific personal jurisdiction reaches defendants with more
limited connections to the forum, but only for more limited types of claims.
Ford, 141 S. Ct. at 1024. For Arizona to exercise specific jurisdiction over an
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out-of-state defendant, the aggregate of the defendant’s contacts with the
forum must reflect purposeful conduct by the defendant targeting the
forum (not just accidental contacts or those created by the plaintiff’s
unilateral acts), there must be a sufficient connection between those
contacts and the plaintiff’s claims, and exercise of jurisdiction must be
reasonable. Beverage v. Pullman & Comley, LLC, 232 Ariz. 414, 417, ¶ 9 (App.
2013) (citing Plan. Grp., 226 Ariz. at 266, 268, 270, ¶¶ 16, 25, 37; Williams, 199
Ariz. at 4, ¶ 11). We consider the totality of the defendant’s contacts with
the forum, Scott v. Kemp, 248 Ariz. 380, 388, ¶ 24 (App. 2020) (quoting Plan.
Grp., 226 Ariz. at 269, ¶ 29), but—critical here—the plaintiff’s claims “‘must
arise out of or relate to the defendant’s contacts’ with the forum.” Ford, 141
S. Ct. at 1025 (quoting Bristol-Myers, 137 S. Ct. at 1780).
¶30 Here, the undisputed facts showed that the Illinois
Defendants purposefully directed at least a portion of their business
activities toward Arizona through BRCIL’s distribution agreement with
Arizona-based BRC Inc. See Burger King Corp. v. Rudzewicz, 471 U.S. 462,
475–76 (1985). As part of that business relationship, BRCIL fielded out-of-
state tissue requests, then coordinated (via frequent email communication
and physical visits to the state) distribution from BRC Inc. in Arizona to the
recipient organizations. Although the contract itself did not require BRC
Inc. to fulfill the requests solely from anatomical donations made in
Arizona, the Illinois Defendants admitted that all of the tissue was in fact
sourced from Arizona decedents. The Illinois Defendants thus
“deliberately ‘reached out beyond’ [their] home” in Illinois by “entering a
contractual relationship centered [in Arizona].” Ford, 141 S. Ct. at 1025
(quoting Walden v. Fiore, 571 U.S. 277, 285 (2014)).
¶31 Notwithstanding the Illinois Defendants’ contacts with
Arizona, Appellants’ jurisdictional argument fails because the undisputed
facts showed that Appellants’ claims against the Illinois Defendants did not
“arise out of or relate to” those contacts with Arizona. See Ford, 141 S. Ct.
at 1026 (emphasis omitted). As Appellants acknowledged in superior court,
their claims hinged on the anatomical donation process itself, specifically
BRC Inc.’s fraudulent misrepresentations “that the bodies would be used
for education and research[,] not marked up in price and sold for profit to
whomever, wherever, against the donor’s wishes.” But there was no
evidence that the Illinois Defendants were involved in any manner with
securing donations in Arizona. And the Arizona-based Appellants offered
no evidence of any communication with the Illinois Defendants, much less
false statements wrongfully inducing donations of Arizona decedents’
bodies in Arizona.
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¶32 Appellants rely primarily on the distribution agreement to
attempt to connect their claims to the Illinois Defendants’ contacts with
Arizona. But as the superior court observed, there was nothing inherently
actionable about the terms of the distribution agreement or the method by
which the Illinois Defendants coordinated distribution of tissue under that
contract. Any wrongfulness arose from BRC Inc.’s misrepresentations and
misconduct, and no evidence linked that—the core of the plaintiffs’
claims—to the Illinois Defendants’ forum contacts.
¶33 Citing Scott v. Kemp, 248 Ariz. 380 (App. 2020), Appellants
argue that the superior court wrongly ignored the bulk of the Illinois
Defendants’ contacts with Arizona by focusing narrowly on the Illinois
Defendants’ (lack of) direct communication with Arizona donors.
“[J]urisdictional contacts are to be analyzed not in isolation, but rather in
totality.” Plan. Grp., 226 Ariz. at 269, ¶ 29; Scott, 248 Ariz. at 388, ¶ 24; see
also Ford, 141 S. Ct. at 1028. To support exercise of jurisdiction, however,
those contacts must relate to the plaintiff’s claims. Plan. Grp., 226 Ariz. at
266, ¶ 16; see also Ford, 141 S. Ct. at 1031 (noting that in light of defendant
Ford’s “veritable truckload of contacts” with the forum states, “[t]he only
issue is whether those contacts are related enough to the plaintiffs’ suits”).
¶34 Here, the superior court properly and expressly considered
the totality of the Illinois Defendants’ forum contacts—their business
relationship with BRC Inc., including their distribution agreement, as well
as a myriad of communications ancillary to that relationship. The court
concluded that those contacts did not support specific jurisdiction,
however, because they were not adequately related to the alleged deception
and misrepresentations underlying plaintiffs’ claims. Put simply, the
claims did not come about “because of [any] ‘activity [or] occurrence’
involving the defendant that [took] place in [Arizona].” Ford, 141 S. Ct. at
1026–27 (emphasis added) (quoting Bristol-Myers, 137 S. Ct. at 1780–81). In
contrast, exercise of jurisdiction was proper in Scott precisely because the
defendants’ contacts with Arizona (which involved their control over the
operation of Arizona skilled-nursing and long-term care facilities) were
closely related to the plaintiffs’ claims (which were premised on negligent
operation of skilled-nursing and long-term-care facilities). Scott, 248 Ariz.
at 384–86, 388–89, ¶¶ 4, 8, 10, 24–25.
¶35 Appellants argue—as they have repeatedly asserted based on
the allegations of the operative complaint—that the requisite nexus exists
because the Illinois Defendants “knew the promises and assurances made
to Arizona donors and intentionally disregarded donor wishes” when
distributing tissue, and that they otherwise conspired with the Arizona
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Defendants to perpetrate the scheme. Those well-pled factual allegations
of joint action sufficed to defeat the Illinois Defendants’ Rule 12(b)(2)
motion to dismiss.
¶36 But to defeat the Illinois Defendants’ motion for summary
judgment, Appellants were required to produce evidence (not just
allegations) of that knowledge and agreement or assistance in perpetrating
the wrong. See Nat’l Bank of Ariz. v. Thruston, 218 Ariz. 112, 119, ¶ 26 (App.
2008); see also Ariz. R. Civ. P. 56(e). The Illinois Defendants provided
evidence that they were not involved with the anatomical donations in
Arizona, which tracked the distribution agreement, under which BRC Inc.
warranted that it had received “lawful and valid informed consent” for all
donations and that all tissue was obtained in compliance with applicable
law. Appellants produced no contrary evidence.
¶37 At best, Appellants attempted to link the Illinois Defendants
to the alleged misconduct through their alter ego theory. But the superior
court found “no probative evidence” that BRC Inc. and BRCIL were in fact
alter egos of each other, a ruling Appellants have not challenged on appeal.
Even Appellants’ other, non-fraud-specific claims required either intent or
at least knowledge of the underlying misconduct. See, e.g., Watkins v.
Arpaio, 239 Ariz. 168, 170–71, ¶ 8 (App. 2016) (intentional infliction of
emotional distress); Ramirez v. Health Partners of S. Ariz., 193 Ariz. 325, 332,
¶ 24 (App. 1998) (wrongful interference with a dead body); Wells Fargo Bank
v. Ariz. Laborers, Teamsters & Cement Masons Loc. No. 395 Pension Tr. Fund,
201 Ariz. 474, 498, ¶ 99 (2002) (civil conspiracy); Hannosh v. Segal, 235 Ariz.
108, 111–12, ¶ 7 (App. 2014) (racketeering); Wells Fargo, 201 Ariz. at 485, ¶
34 (aiding and abetting). And the only asserted link between these claims
and the Illinois Defendants connection to Arizona was Appellants’ rejected
alter-ego theory.
¶38 Because the Illinois Defendants’ contacts with Arizona lacked
an adequate connection to the claims, the superior court properly
concluded that Arizona lacked specific personal jurisdiction. See Ford, 141
S. Ct. at 1025–26 (noting that the requirement that the suit arise out of or
relate to the defendant’s forum contacts “incorporates real limits” to protect
out-of-state defendants). We thus affirm the summary judgment ruling in
favor of the Illinois Defendants.
CONCLUSION
¶39 The judgment dismissing the Illinois Defendants is affirmed.
As the successful party on appeal, the Illinois Defendants are entitled to an
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award of their costs on appeal upon compliance with ARCAP 21. See A.R.S.
§ 12-342(A).
AMY M. WOOD • Clerk of the Court
FILED: AA
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