Digital Media Solutions, LLC v. Zeetogroup, LLC ( 2022 )

1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA 11 12 DIGITAL MEDIA SOLUTIONS, LLC, Case No.: 3:22-cv-01184-JLS-AHG 13 Plaintiff, ORDER: 14 v. (1) RESOLVING JOINT 15 ZEETOGROUP, LLC, DISCOVERY MOTION BY GRANTING IN PART PLAINTIFF’S 16 Defendant. REQUEST FOR JURISDICTIONAL 17 DISCOVERY; and 18 (2) RESETTING DEADLINE FOR 19 PLAINTIFF TO FILE AMENDED COMPLAINT 20 21 [ECF No. 22] 22 23 Before the Court is the parties’ Joint Discovery Motion Regarding Plaintiff’s 24 Request for Jurisdictional Discovery (“Joint Motion”). ECF No. 22. For the reasons 25 explained in more detail below, the Court will GRANT Plaintiff’s request for jurisdictional 26 discovery in part by allowing a limited one-hour deposition of Stephen Goss regarding 27 Mr. Goss’s citizenship. 28 \\ 1 I. BACKGROUND 2 Plaintiff Digital Media Solutions, LLC (“Plaintiff” or “DMS”) filed this action 3 against Defendant Zeetogroup, LLC (“Defendant” or “Zeetogroup”) in federal court on 4 August 12, 2022. ECF No. 1. The same day, Zeetogroup also filed an action in state court 5 against DMS and related entities, which DMS removed to federal court on 6 September 14, 2022. See Case No. 3:22-cv-01396-JLS-AHG, Zeetogroup, LLC v. Digital 7 Media Solutions, LLC et al. (S.D. Cal.). 8 On September 15, 2022, the Court ordered Plaintiff to show cause as to subject- 9 matter jurisdiction, explaining that Plaintiff had invoked federal jurisdiction on the basis 10 of diversity jurisdiction but had failed to identify the citizenship of each individual member 11 of the LLC parties. ECF No. 7. Both parties filed written responses. ECF Nos. 8, 9. Plaintiff 12 contends complete diversity exists because Defendant’s sole member, Stephen Goss, is a 13 citizen of the state of California, while none of Plaintiff’s members is a citizen of 14 California. ECF No. 8 at 5. Defendant disputes that Mr. Goss is a citizen of California, 15 claiming that he is a “stateless alien” because he “has been living in Dubai[.]” ECF No. 9 16 at 2. Therefore, Defendant argues there is no basis for this case to be heard in federal court. 17 On November 2, 2022, after reviewing the parties’ responses to its Order to Show 18 Cause, the Court dismissed this case without prejudice for lack of subject-matter 19 jurisdiction. ECF No. 18. Specifically, the Court found that “neither Party has conclusively 20 established Mr. Goss’s citizenship for diversity purposes,” and because Plaintiff bore the 21 burden to establish that diversity jurisdiction exists and failed to do so, the Court dismissed 22 Plaintiff’s Complaint without prejudice but granted Plaintiff leave to file an amended 23 complaint within 30 days. ECF No. 18 at 8-11. 24 Plaintiff now seeks to compel Mr. Goss to submit to a deposition and moves this 25 Court for an order allowing jurisdictional discovery in order to establish Mr. Goss’s 26 citizenship for diversity purposes. ECF No. 22 at 2-6. Although Defendant initially refused 27 to provide any form of jurisdictional discovery, following a Discovery Conference with the 28 Court, Defendant has offered to compromise by providing a “simple declaration” from Mr. 1 Goss describing his “location and intents.” Id. at 7. In the alternative, if the Court orders a 2 deposition of Mr. Goss, Defendant requests that the deposition be limited to one hour 3 maximum. Id. The Court has stayed the deadline for Plaintiff to file an amended complaint 4 in this case pending resolution of the Joint Motion. ECF No. 21 at 3. 5 II. LEGAL STANDARD 6 Jurisdictional discovery “should ordinarily be granted where ‘pertinent facts bearing 7 on the question of jurisdiction are controverted or where a more satisfactory showing of 8 the facts is necessary.’” Butcher’s Union Loc. No. 498, United Food & Com. Workers v. 9 SDC Inv., Inc., 788 F.2d 535, 540 (9th Cir. 1986) (quoting Data Disc, Inc. v. Systs. Tech. 10 Assocs., Inc., 557 F.2d 1280, 1285 n.1 (9th Cir. 1977)). 11 Although a plaintiff seeking jurisdictional discovery is not required to make “a prima 12 facie showing that jurisdiction actually exists[,]” the plaintiff “‘must make at least a 13 colorable showing” of jurisdiction. Maple Leaf Adventures Corp. v. Jet Tern Marine Co., 14 No. 15-CV-02504-AJB-BGS, 2016 WL 3063956, at *9 (S.D. Cal. Mar. 11, 2016) (quoting 15 NuboNau, Inc. v. NB Labs, Ltd., No. 10cv2631-LAB (BGS), 2011 WL 5237566, at *3 16 (S.D. Cal. Oct. 31, 2011)). While a “colorable” showing is something less than a prima 17 facie showing, a “mere hunch” that the requested discovery “‘might yield jurisdictionally 18 relevant facts’ is insufficient.” Maple Leaf, 2016 WL 3063956, at *9 (quoting Boschetto v. 19 Hansing, 539 F.3d 1011, 1020 (9th Cir. 2008)). See also Butcher’s Union, 788 F.2d at 540 20 (affirming the lower court’s denial of jurisdictional discovery where the plaintiffs stated 21 “only that they ‘believe’ discovery will enable them to demonstrate sufficient California 22 business contacts to establish the court’s personal jurisdiction.”). 23 III. DISCUSSION 24 The Court finds that Plaintiff has not shown that a deposition of Mr. Goss beyond 25 the one-hour maximum limit requested by Defendant is warranted. Plaintiff argues that the 26 Court should permit the requested jurisdictional discovery “because Defendant has 27 contested diversity jurisdiction and this deposition is likely to yield relevant jurisdictional 28 facts.” ECF No. 22 at 5. However, this argument obscures the applicable standard, which 1 requires Plaintiff to make a colorable showing of jurisdiction that goes beyond a “mere 2 hunch” that the discovery “might yield jurisdictionally relevant facts.” While it is true that 3 jurisdictional discovery should ordinarily be permitted where “pertinent facts bearing on 4 the question of jurisdiction are controverted[,]” Plaintiff’s argument that “Defendant has 5 contested diversity jurisdiction” only speaks to the second half of that standard. That is, 6 Plaintiff has not identified what “pertinent facts”—whether contested by Defendant or 7 not—would give rise to diversity jurisdiction in this case. 8 For that reason, the Court finds that Plaintiff is not entitled to jurisdictional discovery 9 beyond the alternative compromise offered by Defendant that Mr. Goss sit for a one-hour 10 deposition limited to questions regarding his citizenship. In reaching this conclusion and 11 ordering a deposition rather than a simple declaration, the Court finds that “a more full and 12 satisfactory showing of the facts is required” before the Court can adequately determine 13 whether diversity jurisdiction exists. Twentieth Century Fox Int’l Corp. v. Scriba, 385 F. 14 App’x 651, 653 (9th Cir. 2010). The key pertinent fact bearing on the question of 15 jurisdiction is the fact of Mr. Goss’s citizenship, which remains undetermined. The 16 declaration submitted by Defendant’s Chief Revenue Officer in its response to the Court’s 17 Order to Show Cause indicates that Mr. Goss previously lived somewhere in the United 18 States before the beginning of the COVID-19 pandemic “and is currently residing in 19 Dubai.” ECF No. 9-1, Cardwell Decl. ¶ 3. As the Court explained in its Order dismissing 20 Plaintiff’s Complaint for lack of subject-matter jurisdiction, although Plaintiff has failed to 21 establish that Mr. Goss is a citizen of California, this evidence from Defendant is “equally 22 weak” to establish the domicile of Mr. Goss in Dubai, because “Defendant does not state 23 how long Mr. Goss has been living in Dubai or whether he intends to remain there.” ECF 24 No. 18 at 7. If Mr. Goss was domiciled in California before living in Dubai, and he intends 25 to return to California, he may still be a citizen of California for purposes of diversity 26 jurisdiction. Therefore, Plaintiff may depose Mr. Goss for no longer than one hour to 27 ascertain facts related solely to his citizenship—i.e., where he previously resided in the 28 United States, where he resides now, and where he intends to remain or return. I IV. CONCLUSION 2 For the foregoing reasons, Plaintiff's request for jurisdictional discovery is 3 || GRANTED in part. Plaintiff may depose the sole member of Defendant’s LLC, Stephen 4 Goss, for a maximum of one hour on the record. The deposition shall be limited to the 5 ||topic of Mr. Goss’s citizenship. The parties are instructed to contact the Court at 6 || Goddard@casd.uscourts.gov if any further disputes arise regarding Mr. Goss’s 7 || deposition. Additionally, in accordance with the undersigned’s chambers rules, if a dispute 8 || arises during the course of the deposition, counsel must meet and confer prior to □□□□□□□ 9 ruling from the Court. The parties may call chambers to seek a ruling if meet-and- 10 || confer attempts have failed. If the Court is unable to address the dispute immediately, the 11 ||parties should proceed with other deposition questions if possible while awaiting the 12 || Court’s ruling. 13 IT IS FURTHER ORDERED that the deposition of Mr. Goss may be taken by 14 ||remote means pursuant to Fed. R. Civ. P. 30(b)(4). The Court further WAIVES the 15 ||requirement of Fed. R. Civ. P. 30(c)(1) and will permit the Court Reporter recording the 16 || deposition to do so remotely. 17 Finally, the deadline for Plaintiff to file an amended complaint is hereby RESET for 18 || January 23, 2023. 19 IT IS SO ORDERED. 20 || Dated: December 5, 2022 21 _ Siow. Xion Honorable Allison H. Goddard 23 United States Magistrate Judge 24 25 26 27 28