District Court Finds Specific Personal Jurisdiction over Nonresident Because He Was a Corporate Officer and Sole Shareholder of company Registered To Do business in New York, and Allegedly Was a Central Figure in the Claim

The World in U.S. Courts: Spring 2016 - Personal Jurisdiction/Foreign Sovereign Immunities Act (FSIA)/Forum Non Conveniens | January.15.2016

Fallman v. Hotel Insider Ltd., U.S. District Court for the Southern District of New York, Jan. 15, 2016

Plaintiff Fallman brought an action against (i) his former employer, Hotel Insider Ltd., a UK Company, (ii) Axel Soderberg, the majority shareholder and co-owner of Hotel Insider, (iii) Soderberg Capital Ltd., Soderberg's company, and (iv) an individual named Hans Phillipe Kjellgren. Fallman alleged breach of contract and related claims based on the defendants' termination of his employment as Vice President of Hotel Reviews at Hotel Insider, located in the company's New York office.

Soderberg and Soderberg Capital Ltd. moved to dismiss for lack of personal jurisdiction, among other grounds. Fallman first asserted that both defendants consented to general jurisdiction under New York law by registering to do business in New York. The District Court in New York rejected this argument, reasoning that Soderberg Capital Ltd. is not registered to do business in New York, and that Soderberg's role as director of Hotel Insider, a registered NY office of Hotel Insider Ltd., was not sufficient for the Court to exercise general jurisdiction over him in his personal capacity. Fallman next asserted that specific jurisdiction over Soderberg and Soderberg Capital Ltd. was proper under New York's long arm statute. The Court concluded that it lacked personal jurisdiction over Soderberg Capital because that company's only asserted connection with New York—that it had entered into a contract with a company headquartered in New York—is insufficient. The Court concluded that it did, however, have personal jurisdiction over defendant Soderberg because he was a corporate officer and sole shareholder of a company registered to do business in New York (Hotel Insider), and was a primary actor in the activities that gave rise to the litigation.

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