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Small Business Lending, LLC v. Pack

United States District Court, S.D. Indiana, Indianapolis Division

January 4, 2019

DAVID PACK, Defendant.



         Presently pending before the Court is Defendant David Pack's Motion to Dismiss, in which he alleges that this Court lacks in personam jurisdiction over him. [Filing No. 9.] Mr. Pack seeks to dismiss Plaintiff Small Business Lending, LLC's (“SBL”) Complaint for injunctive relief and damages related to a written agreement between SBL and Mr. Pack. [Filing No. 1-1 at 7-17.] Mr. Pack's Motion is fully briefed and is now ripe for the Court's review. For the reasons stated herein, the Court DENIES Mr. Pack's Motion.

         I. Legal Standard

         When a defendant moves to dismiss a complaint under Federal Rule of Civil Procedure 12(b)(2), “[t]he plaintiff bears the burden of showing that personal jurisdiction over the defendant exists.” Claus v. Mize, 317 F.3d 725, 727 (7th Cir. 2003). When, as here, the Court “rules on a defendant's motion to dismiss based on the submission of written materials, without the benefit of an evidentiary hearing . . . the plaintiff ‘need only make out a prima facie case of personal jurisdiction.'” Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003) (quoting Hyatt Int'l. Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002)). Accordingly, “[o]nce the defendant has submitted affidavits or other evidence in opposition to the exercise of jurisdiction, the plaintiff must go beyond the pleadings and submit affirmative evidence supporting the exercise of jurisdiction.” Id. at 782-83. Factual disputes, however, are resolved in the plaintiff's favor. Id.

         “A federal district court's personal jurisdiction over a defendant is established in a diversity-jurisdiction case . . . only so long as the defendant is subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located.” Northern Grain Mktg., LLC v. Greving, 743 F.3d 487, 491 (7th Cir. 2014). Indiana Trial Rule 4.4(A) serves as Indiana's long-arm provision and expands personal jurisdiction to the full extent permitted by the Due Process Clause. See LinkAmerica Corp. v. Cox, 857 N.E.2d 961, 965-66 (Ind. 2006). “Thus, the statutory question merges with the constitutional one-if [Indiana] constitutionally may exercise personal jurisdiction over a defendant, its long-arm statute will enable it to do so.” Northern Grain, 743 F.3d at 492.

         “The federal constitutional limits of a court's personal jurisdiction in a diversity case are found in the Fourteenth Amendment's due-process clause.” Id. “[F]ederal constitutional law draws a sharp and vital distinction between two types of personal jurisdiction: specific or case-linked jurisdiction, and general or all-purpose jurisdiction.” Abelesz v. OTP Bank, 692 F.3d 638, 654 (7th Cir. 2012). “If the defendant's contacts are so extensive that it is subject to general personal jurisdiction, then it can be sued in the forum state for any cause of action arising in any place. More limited contacts may subject the defendant only to specific personal jurisdiction, in which case the plaintiff must show that its claims against the defendant arise out of the defendant's constitutionally sufficient contacts with the state.” uBID, Inc. v. GoDaddy Group, Inc., 623 F.3d 421, 425 (7th Cir. 2010). Specific personal jurisdiction is at issue in this case.

         II. Background

         A. The Agreement

         On or about April 4, 2018, Mr. Pack and SBL entered into an independent contractor agreement (the “Agreement”). [Filing No. 1-1 at 32 (containing the parties' signatures, dated April 3 and April 4, 2018).] The Agreement provides, in relevant part, as follows:

This Agreement (the "Agreement") is made on 04/03/2018, by and between Small Business Lending LLC, (the "Company"), located at 7206 Franklin Parke Blvd, Indianapolis, Indiana 46259 in the County ot Marion, and David W. Pack, (the "Independent Contractor" or "Contractor") located at ¶ 163 Caraway Ct, Spartanburg, Georgia 29303

[Filing No. 1-1 at 19.] Thereafter, the Agreement states that “[t]he Independent Contractor is secured to provide the services described below at the Company's principal place of business as aforementioned, or from the Contractor's principal place of business, if applicable, as aforementioned.” [Filing No. 1-1 at 19.]

         The Agreement provides that the “Independent Contractor is or shall remain open to conducting similar tasks or services for the Company, which may not be listed or described below, or for entities other than the Company and thus holds himself or herself out to the public to be a separate business entity.” [Filing No. 1-1 at 19.] Subsequently, regarding the scope of work, the Agreement provides that:

The contractor will be provided leads and also have access to the predictive dialer. Once the leads are provided the contractor will contact and send application and retrieve documents so that we can provide business financing needs

[Filing No. 1-1 at 20.]

         The Agreement contains the following provisions discussing compensation:

Compensation Terms: Commissions are paid daily as they are paid to the company. Commission is based on the size of the loans that are issued to the merchants that are generated from the current campaign (the size and amount can never be guaranteed). The commission that is paid on the funded financed deal and will vary deal to deal. Commission that you are paid is 33 % of the funded deal, this is not known until the offer is confirmed with the lender as there are many variables with each deal. Commission will be paid the following day after Small Business Lending LLC receives the Commission via Direct deposit. Total Compensation Amount: $0.00
Said compensation shall become due and payable to the Independent Contractor upon receipt of an invoice by the Company and payable pursuant to the following schedule and method:
Compensation Schedule: 2-10 days after the deal is funded in the event of a defaulted loan commission will be paid back in entirety via Clawback Compensation Method: Commission from the funded deal will be paid

[Filing No. 1-1 at 21.]

         The Agreement contains a non-solicitation clause which provides that the independent contractor shall not solicit or attempt to solicit customers or clients of the company “throughout the duration of this Agreement and for a period of (sic) immediately following the termination of this Agreement.” [Filing No. 1-1 at 23.]

         The Agreement contains a non-compete clause which ...

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