United States District Court, D. Colorado
OPINION AND ORDER DENYING MOTION TO DISMISS
S. KRIEGER SENIOR UNITED STATES DISTRICT JUDGE
MATTER comes before the Court on the
Defendant’s Motion to Dismiss or Change Venue
(# 40), the Plaintiff’s response
(# 53), and the Defendant’s reply
(# 56). For the reasons that follow, the
Motion is denied.
Court has subject-matter jurisdiction to hear this case under
28 U.S.C. § 1332(a). The parties dispute whether the
Court can exercise personal jurisdiction over the Defendant.
Plaintiff, Pharmacists Mutual Insurance Co.
(“PHMIC”), is an Iowa corporation with its
principal place of business in Algona, Iowa. PHMIC issued an
automobile insurance policy to Kimberly Schock, a Colorado
resident. Defendant Namic Insurance Co.
(“NAMICO”) is an Indiana corporation with its
principal place of business in Indianapolis. NAMICO insured
PHMIC against professional liability.
Schock claimed uninsured-motorist benefits under her policy
with PHMIC. PHMIC initially told Ms. Schock that her
uninsured-motorist benefits were capped at $500, 000, but
later informed her that such benefits were capped at $100,
000. As a result, Ms. Schock accused PHMIC of acting in bad
faith, and sued PHMIC (Case No. 17-CV-0592) claiming breach
of contract, and bad-faith breach of contract for
unreasonable delay and denial of benefits under Colorado law
(the Underlying Action).
undertook PHMIC s defense, both retaining defense counsel in
Colorado and in orchestrating the defense. When Ms. Schock
offered to settle for an amount within the policy limits of
its coverage by NAMICO, NAMICO accepted the offer, but making
its contribution subject to “allocation and funding of
of the settlement amount. PHMIC brings this suit because it
funded the settlement with Ms. Schock and NAMICO has refused
to reimburse it for any part of the sum paid.
Amended Complaint (# 36), PHMIC asserts
three claims against NAMICO: (1) breach of contract based on
its failure to pay under the professional liability policy;
(2) bad faith failure to pay in violation of Colorado law,
specifically, Colorado's Unfair Claims Act, C.R.S.
§§ 10-3-101 et seq, ; and (3) breach of
the covenant of good faith and fair dealing recognized under
Colorado common law. NAMICO moves to dismiss all claims for
lack of personal jurisdiction and improper venue (#
the Court’s jurisdiction over a defendant is challenged
pursuant to Rule 12(b)(2), the plaintiff bears the burden of
establishing that personal jurisdiction exists. Soma
Medical Int’l v. Standard Chartered Bank, 196 F.3d
1292, 1295 (10th Cir. 1999); OMI Holdings Inc. v. Royal
Ins. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998).
Courts may elect to resolve the jurisdictional question
immediately, by conducting an evidentiary hearing on the
issue, or they may defer resolution of the jurisdictional
question until trial, requiring the plaintiff to make only a
prima facie showing of jurisdiction at the pretrial
phase. Wenz v. Memery Crystal, 55 F.3d 1503, 1505
(10th Cir. 1995). The Court may receive affidavits and other
evidentiary material to assist in resolving the issue, but it
must resolve any disputed facts in the light most favorable
to the plaintiff. Id.
the jurisdictional inquiry comprises two components, which
the plaintiff must show. First, the laws of the forum state
confer jurisdiction by authorizing service upon the
defendant, and second, the exercise of such jurisdiction
comports with the principles of due process. Niemi v.
Lasshofer, 770 F.3d 1331, 1348 (10th Cir. 2014).
However, in Colorado, that inquiry is short-circuited because
Colorado’s Long-Arm Statute “confers the maximum
jurisdiction permissible, consistent with the Due Process
clause.” Thus, the inquiry simply becomes one of
whether due-process principles would be satisfied by the
exercise of personal jurisdiction. The due-process inquiry
itself has two components. First, a court must determine
whether a defendant has “such minimum contacts with the
forum state” that it should reasonably expect to be
sued in courts in that state. Second, a court considers
whether the exercise of personal jurisdiction in the
circumstances presented offends traditional notions of fair
play and substantial justice.
minimum-contacts analysis considers whether the defendant is
susceptible to either general or specific jurisdiction in the
forum state. See Am. Fidelity Assur. Co. v. Bank of New
York Mellon, 810 F.3d 1234, 1237 (10th Cir. 2016).
General jurisdiction arises in the location that the
defendant is “at home” - generally, a
corporation’s state of incorporation and its principal
place of business - and in certain “exceptional”
cases, in other locations where the defendant’s
connections are substantial. BNSF Ry. Co. v. Tyrell,
137 S.Ct. 1549, 1558 (2017). Specific jurisdiction is a more
flexible concept, depending upon the nature and extent of the
defendant’s contacts with the forum and whether the
legal claims in suit arise out of those contacts.
Bristol-Meyers Squibb Co. v. Superior Court of Cal.,
137 S.Ct. 1773, 1780 (2017). Specific jurisdiction arises
when the defendant engages in “an activity or
occurrence that takes place in the forum state, ” from
which the claims at issue arise. That activity must be
purposefully directed by the defendant towards the state,
rather than being random or fortuitous or the result of the
actions of another, and the harmful effects of that conduct
must typically be felt in the forum state. Anzures v.
Flagship Restaurant Grp., 819 F.3d 1277, 1280 (10th Cir.
fair-play and substantial-justice analysis requires a
“fact-specific” inquiry on which the defendant
bears the burden of proof. ClearOne Commc’ns Inc.
v. Bowers, 643 F.3d 735, 764 (10th Cir. 2011). The
defendant must present a “compelling case, ”
showing considerations that would render the exercise of
jurisdiction unreasonable. Such considerations include: (1)
the burden on the defendant of litigating in the forum, (2)
the forum state’s interest in resolving the dispute,
(3) the plaintiff’s interest in receiving convenient
and effective relief, (4) the judicial system’s