United States District Court, S.D. Indiana, Indianapolis Division
SHIRLEY MARTIN, RON MARTIN, and MICHAEL SAHARIAN, on their own behalf and on behalf of those similarly situated Plaintiffs,
EIDE BAILLY LLP, Defendant.
ENTRY ON DEFENDANT’S MOTION TO DISMISS FOR LACK
OF PERSONAL JURISDICTION
William T. Lawrence, Judge
cause is before the Court on the Defendant’s motion to
dismiss for lack of personal jurisdiction (Dkt. No.
The motion is fully briefed, and the Court, being duly
advised, GRANTS the motion for the reasons set forth below.
Defendant moves to dismiss this case pursuant to Federal Rule
of Civil Procedure 12(b)(2) for lack of personal
jurisdiction. When a defendant challenges the Court’s
personal jurisdiction over it, the plaintiff bears the burden
of demonstrating the existence of jurisdiction. Jennings
v. AC Hydraulic A/S, 383 F.3d 546, 548 (7th Cir. 2004).
Where, as here, a motion to dismiss is resolved without an
evidentiary hearing, the plaintiff’s burden is
satisfied if it makes a prima facie case of personal
jurisdiction. Purdue Research Found. v.
Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir.
2003). “In evaluating whether the prima facie standard
has been satisfied, the plaintiff is entitled to the
resolution in its favor of all disputes concerning relevant
facts presented in the record.” Id. (quotation
and citations omitted).
as here, there is no applicable federal statute providing for
nationwide service of process, a federal district court may
exercise personal jurisdiction over a defendant if a court of
the state in which it sits would have such jurisdiction.
Fed.R.Civ.P. 4(k)(1)(A). This Court sits in Indiana, and
Indiana Trial Rule 4.4(A) provides for jurisdiction “on
any basis not inconsistent with the Constitution of this
state or the United States”; in other words, Indiana
permits the exercise of personal jurisdiction to the full
extent permitted by the Federal Due Process Clause.
LinkAmerica Corp. v. Albert, 857 N.E.2d 961, 967
are two forms of personal jurisdiction that a court may
exercise over a non-resident defendant: “general”
and “specific” jurisdiction. Helicopteros
Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408
(1984). Specific jurisdiction is applicable when
the basis of the suit “arises out of or is related
to” the defendant’s contacts with the forum
state. Jennings, 383 F.3d at 549.
To establish specific jurisdiction under the familiar minimum
contacts analysis, a plaintiff must show that the defendant
has purposefully availed itself of the privilege of
conducting activities within the forum state and that the
exercise of personal jurisdiction over that defendant would
comport with traditional notions of fair play and substantial
Id. (citations and internal quotation marks
facts alleged by the Plaintiff in the Amended Complaint are
as follows. Plaintiffs Shirley Martin, Ron Martin, and
Michael Saharian (“Plaintiffs”), individually and
on behalf of others similarly situated, filed this suit
against Defendant Eide Bailly LLP, based on Defendant’s
participation in a massive Ponzi scheme of financial fraud
involving DBSI Housing Inc., a/k/a DBSI Inc. (hereafter
“DBSI Housing”) and its subsidiaries
(collectively “DBSI”). DBSI’s fraud bilked
hundreds of millions of dollars from investors in DBSI (the
“Investors”), including Plaintiffs and others
similarly situated. The Defendant is a North Dakota
accounting firm that audited some of the DBsI subsidiaries.
Amended Complaint alleged that the Defendant aided and
abetted DBSI’s material misrepresentations and
omissions, including “the financial condition of DBSI
Housing and DBSI’s portfolio of entities that were the
lessees under the master lease structures at DBSI investment
properties (“Master Lease Portfolio”); the
capitalization, liquidity, and financial condition of Master
LeaseCo; DBSI’s use of Accountable Reserves . . .; and
the DBSI notes corporations’ use of investor money,
compliance with loan-to-value ratio restrictions, and
assets.” Dkt. No. 34 at 2.
named Plaintiffs are citizens of Indiana. Plaintiffs Shirley
and Ron Martin purchased a DBSI investment, and the sale
occurred in Indiana. Likewise, Plaintiff Saharian purchased a
DBSI investment, and that sale also occurred in Indiana.
Plaintiffs have asserted that the Court has personal
jurisdiction over the Defendant under the theory of
conspiracy-based personal jurisdiction. The Court will
assume, without deciding, that the facts alleged by the
Plaintiffs would be sufficient to support the exercise of
personal jurisdiction over the Defendant under the conspiracy
theory of personal jurisdiction if that theory were
recognized in ...