New England College v . Drew University CV-08-424-JL 10/23/09 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE

New England College

v. Civil N o . 08-cv-424-JL Opinion N o .

Drew University, and Anne Marie Macari

MEMORANDUM ORDER

This case involves a dispute between two colleges over

poetry in motion. The plaintiff, New England College (“NEC”),

has sued Drew University (“Drew”) and Anne Marie Macari, alleging

that while Macari was serving as interim director of NEC’s

graduate poetry program, she secretly conspired with Drew to

develop a similar program and to solicit NEC faculty and students

to affiliate with Drew. NEC has brought claims of breach of

fiduciary duty, breach of contract, and intentional interference

with various contractual and other relationships, including

between NEC and its faculty and students.

Drew filed a motion to dismiss for lack of personal

jurisdiction o r , in the alternative, to transfer venue to the

District of New Jersey (where Drew is located), arguing that it

has insufficient contacts with New Hampshire (where NEC is

located). This court denied the motion on February 1 7 , 2009,

without prejudice to its reinstatement after a period of jurisdictional discovery. See New Eng. College v . Drew Univ.,

, 1 0 .

Drew has now reinstated the motion. This court has subject-

matter jurisdiction under

(a)(1) (diversity).

After hearing oral argument and evaluating the parties’ written

submissions, including discovery materials, this court denies

Drew’s motion. Although the court initially had been “inclined

to grant” the motion because NEC had presented only “speculation

without any evidentiary foundation,”

at 5 , 9, jurisdictional

discovery has enabled NEC to make a prima facie showing –-

sufficient to establish personal jurisdiction over Drew –- that

Drew authorized or at least ratified Macari’s efforts to move the

poetry program to Drew, such that her conduct in New Hampshire

can be imputed to Drew for jurisdictional purposes. In addition

to Macari’s efforts, Drew purposefully directed its out-of-forum

activities at NEC in New Hampshire with knowledge that they would

have significant in-forum effects.

I. Applicable legal standard

The plaintiff bears the burden of showing personal

jurisdiction over the defendants. See Hannon v . Beard,

(1st C i r . ) , cert. denied, 126 S . C t . 726 (2008). When

evaluating a defendant’s motion to dismiss for lack of personal

2 jurisdiction, the standard of review varies according to the

procedural posture of the case. See Boit v . Gar-Tec Prods.,

Inc.,

7 1 , 674-78 (1st Cir. 1992). Where, as here, the

court rules on such a motion without holding an evidentiary

hearing, it applies a “prima facie” standard of review.1 See,

e.g., U.S. v . Swiss Am. Bank, Ltd.,

1 0 , 618 (1st Cir.

2001). “Under the prima facie standard, the inquiry is whether

the plaintiff has proffered evidence which, if credited, is

sufficient to support findings of all facts essential to personal

jurisdiction.” Phillips v . Prairie Eye Ctr.,

2 , 26

(1st Cir. 2008), cert. denied, 129 S . C t . 999 (2009). The court

must accept the plaintiff’s evidentiary proffers as true, so long

as they are properly documented, and must construe them in the

light most favorable to the existence of jurisdiction.

Facts put forward by the defendants may be considered only if

they are “uncontradicted” by the plaintiff’s submissions. Mass.

Sch. of Law at Andover, Inc. v . Am. Bar Ass'n,

6 , 34

1 Drew did not request an evidentiary hearing or a different standard of review in its motion to dismiss. The court of appeals has said that “all litigants effectively are on notice that motions to dismiss for want of personal jurisdiction will be adjudicated under the prima facie standard unless the court informs them in advance that it will apply a more demanding test,” which has not happened here. Rodriguez v . Fullerton Tires Corp.,

1 , 84 (1st Cir. 1997) (emphasis in original). Drew therefore waived any argument for a different standard of review.

3 (1st Cir. 1998). The following statement of facts conforms to

those requirements.

II. Background

In March 2007, Macari accepted an offer to become interim

director of the graduate poetry program at NEC in Henniker, New

Hampshire, where she had been a faculty member. The program,

which involved long-distance learning punctuated by brief periods

of residency with prominent poets, was billed by NEC as the only

all-poetry program of its kind.

About a month later, without telling NEC, Macari met with

Drew’s president and other representatives in New Jersey to

discuss the possibility of developing a similar poetry program at

Drew. Macari told them about her interim position at NEC and

said that she could bring a good faculty with her to Drew,

including some of the poets affiliated with NEC’s program.

Macari, who lived in New Jersey, returned to New Hampshire

shortly thereafter to direct the NEC program’s summer residency.

While in New Hampshire, she spoke with various NEC faculty

members about possibly affiliating with Drew, and some of them

expressed interest in doing s o . She did not tell anyone else at

NEC about her plans.

4 Macari met with Drew officials again in New Jersey at the

end of the summer. In advance of the meeting, she provided them

with background materials regarding the proposed program, such as

a potential faculty list that included various NEC faculty

members, budget notes that were based in part on “the budget that

I have from our school,” and a curriculum similar to that of

NEC’s program. At the meeting, the parties discussed “bringing

most of our faculty from NEC” to Drew. Drew also agreed to

accept NEC transfer students with full credit for their prior

coursework and “the same tuition and scholarships as was given to

them at NEC.”

After that second meeting, Macari continued to work on a

more detailed budget proposal. She sent Drew two versions in

October 2007. The first version “assume[d] that most of our

students [will] follow us” from NEC to Drew, and the other

version assumed the opposite. Macari expressed concern that a

delayed start to Drew’s program “may well mean that our students

at NEC will get used to the new director and will chose [sic] not

to follow us to Drew,” but added, “[o]f course I hope that most

of them will follow us.” Her budget included detailed

information about NEC’s tuition rates, scholarship funding,

advertising methods, and faculty salaries. She told Drew that

the cost of linens during residency periods was the “only detail

5 I can’t seem to pin down without giving myself away too much to

my coworker [i.e., the program administrator] at NEC.”

Macari collaborated with a Drew professor, Peggy Samuels, to

develop a written sales pitch to be used in gaining approval for

the poetry program from the relevant committees at Drew. The

sales pitch stated that the program had “used NEC as its

institutional home” for the past fifteen years and that Macari

was “seek[ing] to find a new institutional home for the program,”

which “already has a strong national reputation.” The sales

pitch noted that the budget projections were based on the

previous known costs of NEC’s program. One of Drew’s faculty

members commented approvingly that “this MFA [program] is hardly

starting from scratch –- rather, it is being transplanted more or

less whole to a new institutional home. Its faculty are already

in place.” A summary that Drew provided to its Academic Affairs

Committee also stated that it was “expected that a number of

[NEC] students will follow the faculty to Drew.”

When the program received a favorable vote from Drew’s

Academic Affairs Committee in December 2007, Professor Samuels

wrote to Macari: “I’m glad we managed to get to this [p]oint

before the Jan[uary] Res[idency] so that you can spread the word

there a bit.” Samuels acknowledged at her deposition that

6 “there” meant NEC and that she was asking Macari to spread the

word about Drew’s new program.

Macari announced her resignation from NEC in February 2008,

after the January residency period. The news came as a surprise

to NEC officials, who still knew nothing of her plans with Drew.

Macari had felt like she was simultaneously “doing 2 jobs, one of

them [with Drew] is covert and doesn’t pay (yet), and the other

one [with NEC] is horrible and pays poorly.” After breaking the

news to NEC, she admitted to Drew officials that “it has been a

real strain for me to be trying to do right by both Drew and NEC

and I am relieved to be finished with NEC now.”

The presidents of Drew and NEC later discussed the matter by

phone, and Drew’s president indicated that Drew might take a few

faculty members from NEC’s program but would not be soliciting

any of NEC’s students. There is evidence, however, that Macari

affirmatively contacted at least one incoming NEC student about

Drew’s program and also reported to Drew’s president on NEC

student interest in Drew. Ultimately, several NEC faculty

members and students did affiliate with Drew’s program. NEC

claims that its program suffered lower enrollment and other

adverse effects because of Drew’s actions.

7 III. Analysis

A. Personal jurisdiction

There is no claim here that the court has general

jurisdiction over Drew. See Harlow v . Children’s Hosp.,

0 , 57 (1st Cir. 2005) (explaining the difference between general

and specific jurisdiction). NEC bases its claim of specific

personal jurisdiction over Drew on the New Hampshire long-arm

statute, which provides that “jurisdiction over nonresidents may

be exercised whenever the requirements of the Due Process Clause

of the United States Constitution are satisfied.” Alacron, Inc.

v . Swanson,

(2000); see U.S. Const. amend. XIV.

The court therefore proceeds directly to the due process

analysis.

Due process under the Fourteenth Amendment requires that a

defendant have “sufficient minimum contacts with the [forum]

state such that ‘maintenance of the suit does not offend

traditional notions of fair play and substantial justice.’”

Adelson v . Hananel,

3 , 49 (1st Cir. 2007) (quoting

Int'l Shoe C o . v . Washington,

1 0 , 316 (1945)) (further

quotation omitted). Specific jurisdiction consists of three

elements: First, the defendant must have “purposefully directed”

its activities at the forum state. Keeton v . Hustler Magazine,

Inc.,

7 0 , 774 (1984) (purposeful availment). Second,

8 each of the plaintiff’s causes of action must be “related to or

arise[] out of” those forum-directed activities. Helicopteros

Nacionales de Colombia, S.A. v . Hall,

0 8 , 414 (1984)

(relatedness). Third, the exercise of jurisdiction must be

reasonable. See Phillips,

7 .

As to purposeful availment, NEC has proffered evidence that,

if accepted as true and construed in the light most favorable to

NEC, shows that Drew purposefully directed its activities at New

Hampshire. The evidence would support an inference that Drew and

Macari sought, in effect, to relocate an established poetry

program from NEC in New Hampshire to Drew in New Jersey and to

bring along NEC faculty and students. Many of Drew’s documents

describe their plans in precisely that manner (e.g., as creating

a “new institutional home” for NEC’s program). The evidence also

would support an inference that Drew encouraged Macari to

secretly gather information about NEC’s budget and operations in

New Hampshire for use by Drew in developing its rival program.

All of these actions were aimed directly at a New Hampshire

institution.

In perhaps the clearest example of purposeful availment,

Drew expressly asked Macari to “spread the word” about its new

program at NEC while directing her last residency there. This

request cannot be brushed aside as a single, isolated statement.

9 When viewed (as it must be) in the context of their other

communications and construed in the light most favorable to NEC,

the statement is a clear instruction from Drew to Macari to

follow through on their express plan to lure faculty and students

from NEC to Drew, as just approved by Drew’s Academic Affairs

Committee.

Drew argues that there is no evidence that any of its

representatives ever visited New Hampshire in connection with

this matter or committed any relevant acts here. This argument

fails for two reasons. First, Macari committed a number of

relevant acts in New Hampshire on Drew’s behalf and with Drew’s

knowledge. It is well established that a plaintiff’s

jurisdictional showing “may rely in whole or in part on actions

imputed to [an entity] through its agents.” Jet Wine & Spirits,

Inc. v . Bacardi & Co., Ltd.,

, 7 (1st Cir. 2002). The

agent can either be “initially authorized to act on behalf of a

principal” or the principal can “later ratif[y] the agent’s

conduct.” Daynard v . Ness, Motley, Loadholt, Richardson & Poole,

P.A.,

2 , 55 (1st Cir. 2002). The key question is not

whether an agency relationship technically exists under state

law, but whether a sufficient relationship exists to attribute

the agent’s acts to the principal under the Due Process Clause.

Jet Wine,

; see also Daynard,

6 .

10 Here, there is ample evidence that Drew authorized or at

least ratified Macari’s acts in New Hampshire (e.g., telling her

to “spread the word” of Drew’s program at NEC; using her NEC-

based budget). Macari admits that she felt like she was doing

two jobs, one overtly for NEC and one covertly for Drew. Indeed,

she was introduced to Drew’s graduate faculty in November 2007 as

“the new director for the proposed MFA in poetry program.”2

Under the circumstances, her conduct can reasonably be attributed

to Drew for purposes of the jurisdictional analysis. See

Donatelli v . Nat’l Hockey League,

(1st Cir.

1990) (explaining that jurisdictional agency issues must be based

on a “frank appraisal of the realities surrounding any given

relationship”).3 2 At oral argument, Drew stated that the new program did not receive final approval until February 2008, just before Macari resigned from NEC, and that Macari did not become a paid employee of Drew until March 2008. But construed in the light most favorable to NEC, the record nevertheless suggests that approval of the new program became a near certainty when it received a favorable vote from Drew’s Academic Affairs Committee in December 2007 and that Macari acted with Drew’s authorization and ratification long before she became a paid employee. 3 This agency theory of jurisdiction is distinct from the conspiracy theory of jurisdiction that this court analyzed in its earlier order granting jurisdictional discovery. See New Eng. College,

, at 7 (noting that the First Circuit has never recognized the conspiracy theory). Because jurisdictional discovery revealed evidence to support a more direct agency relationship, NEC no longer relies primarily on the conspiracy theory to support jurisdiction over Drew (though it has preserved the argument).

11 Second, even if there were no evidence that Drew’s

representatives or agents committed relevant acts while

physically present in New Hampshire, such evidence is not always

required. Under the “effects” theory of personal jurisdiction,

first recognized by the Supreme Court in Calder v . Jones,

(1984), a court may properly assert jurisdiction where a

defendant has committed “intentional, and allegedly tortious,

actions” outside the forum state that “were expressly aimed at”

the forum state with knowledge that “the brunt of [the] injury

would be felt” there.

. As the court of appeals

has explained, “knowledge that the major impact of the injury

would be felt in the forum State constitutes a purposeful contact

or substantial connection whereby the intentional tortfeasor

could reasonably expect to be haled into the forum State’s courts

to defend his actions.” N . Laminate Sales, Inc. v . Davis,

4 , 26 (1st Cir. 2005) (quoting Hugel v . McNell,

, 4 (1st Cir. 1989)). 4

4 The court of appeals has repeatedly cautioned that the "effects" theory requires more than the mere existence of in- forum effects. See, e.g., Swiss Am. Bank, 274 F.3d at 625; Mass. Sch. of Law,

6 ; see also PFIP, LLC v . You-Fit, Inc.,

, 38 n.22 (explaining that Northern Laminate, quoted above, is consistent with that principle). In this case, NEC’s prima facie showing of jurisdiction is based not merely on the existence of such effects, but on Drew's intentional conduct aimed at New Hampshire.

12 The court of appeals has held in multiple cases, including

one decided yesterday, that intentional interference with an in-

forum contract or business relationship can establish

jurisdiction under the “effects” theory. See Astro-Med, Inc. v .

Nihon Kohden Am., Inc., Nos. 08-2334 & 08-2335,

(1st Cir. Oct. 2 2 , 2009) (exercising jurisdiction where

nonresident defendant hired employee knowing that he had an in-

forum employment agreement, even though neither the defendant nor

the employee engaged in any relevant in-forum conduct); Jet Wine,

(exercising jurisdiction where nonresident

defendants terminated plaintiff’s right to distribute certain

liquor brands in New Hampshire). While the precise contours of

the jurisdictional analysis continue to be debated, see, e.g.,

Astro-Med,

(Howard, C.J., concurring)

(arguing for a slightly less demanding test in business tort

cases), this case clearly meets the standard if those cases d o .

The evidence here -- more so than in Astro-Med -- supports an

inference that Drew’s actions were both intended to and did have

a significant impact on an established competitor in New

Hampshire, such that Drew could reasonably expect to be haled

into this forum to defend its actions.

13 As to the relatedness component of the jurisdictional

analysis, all of NEC’s causes of action against Drew directly

relate to or arise from Drew’s conduct directed at New Hampshire,

including but not limited to the imputed conduct by Macari inside

New Hampshire. C f . Astro-Med,

(finding

sufficient relatedness to a tortious interference claim even

without any relevant in-state conduct by the employee). For

example, NEC has brought claims for intentional interference with

its existing and/or prospective contractual relations with

faculty and students, and Drew’s conduct involved efforts to lure

NEC faculty and students from New Hampshire to New Jersey. There

is a clear “causal nexus” between the contacts and the claims.

Phillips Exeter Acad. v . Howard Phillips Fund,

8 4 , 289

(1st Cir. 1999) (noting also that “there is a natural blurring of

the relatedness and purposeful availment inquiries in cases in

which the alleged contacts are less tangible than physical

presence,” but they are nonetheless distinct inquiries that share

a “family resemblance”).

Drew has devoted much of its renewed motion to arguing,

based on the jurisdictional discovery, that NEC’s causes of

action lack merit. For example, Drew argues that Macari was an

at-will employee whose employment would have been terminated

anyway and who was free to start a new program with Drew. Drew

14 also notes that, to date, the record contains no faculty or

student contracts other than Macari’s at-will agreement. This is

not, however, the appropriate time to determine the ultimate

merits of NEC’s claims, which are at least colorable as described

in NEC’s pleadings and other filings. See, e.g., Jet Wine,

, 8 (ruling that, “whatever the ultimate merits of Jet

Wine’s substantive claims,” a “plausible” contractual

interpretation was “sufficient for a prima facie showing of

jurisdiction” and that the merits “may be resolved later”).

Whether meritorious or not, the claims each arise from Drew’s

conduct directed at NEC in New Hampshire, which is the relevant

issue for purposes of jurisdiction.

As to the third element, reasonableness is not a barrier to

this court’s jurisdiction over Drew. The Supreme Court’s

familiar “gestalt factors” guide the reasonableness

determination. World-Wide Volkswagen Corp. v . Woodson,

(1980). They include the forum state’s interest in

adjudicating the dispute; the plaintiff’s interest in obtaining

convenient and effective relief; the defendant’s burden of

appearing; the interstate judicial system’s interest in obtaining

the most efficient resolution of the controversy; and the shared

interest of the states in furthering fundamental substantive

social policies. United Elec., Radio and Mach. Workers of Am. v .

15 163 Pleasant S t . Corp.,

, 1088 (1st Cir. 1992)

(citing Burger King Corp. v . Rudzewicz,

6 2 , 477

(1985)).

The factors favoring litigation in New Hampshire include, in

this case, New Hampshire’s interest in redressing harms against

its residents and NEC’s interest in obtaining convenient and

effective relief from a court in its own state. See N . Laminate,

403 F.3d at 26 (citing similar factors). Both New Hampshire and

New Jersey -– Drew’s preferred forum –- would be efficient places

to resolve the controversy. The only factor in New Jersey’s

favor is the defendant’s burden of appearing, and Drew has

presented no persuasive reasons why the burden of defending a

suit in New Hampshire from New Jersey outweighs the factors

favoring New Hampshire. See id.

Stepping back to the fundamental principles of the

constitutional analysis, it is entirely consistent with “fair

play and substantial justice” for Drew to be called to answer in

New Hampshire for its efforts to move an established poetry

program from this state to its campus in New Jersey. Int’l Shoe,

. The court therefore denies Drew’s motion to

dismiss for lack of personal jurisdiction.

16 B. Venue

As an alternative to dismissal, Drew requests that this

court transfer venue to the District of New Jersey, where Drew is

located. A district court may transfer a civil action to any

other district where it may have been brought “[f]or the

convenience of parties and witnesses, in the interest of

justice.”

(a). The court has wide latitude in

determining whether to grant such a transfer. Auto Eur., LLC v .

Conn. Indem. Co.,

0 , 64 (1st Cir. 2003). There i s ,

however, “a strong presumption in favor of the plaintiff's choice

of forum,” which the party requesting transfer must overcome.

Coady v . Ashcraft & Gerel,

, 11 (1st Cir. 2000) (citing

Gulf Oil Corp. v . Gilbert,

0 1 , 508 (1947)). This

presumption is particularly strong where, as here, the plaintiff

has chosen its home state as the forum. Sousa v . TD Banknorth

Ins. Agency, Inc.,

5 4 , 457 (D.N.H. 2006)

(Barbadoro, D.J.) (citing Piper Aircraft C o . v . Reyno,

(1981)).

Drew has not met the demanding standard for a transfer. Any

convenience that Drew and Macari would gain from litigating in

New Jersey would be offset by the inconvenience that NEC would

suffer from litigating outside of New Hampshire. The operative

events occurred in both jurisdictions. Witnesses and evidentiary

17 materials are located in both jurisdictions. To the extent that

the New Jersey witnesses may outnumber the New Hampshire

witnesses and would be beyond this court’s subpoena power, many

of them are affiliated with Drew and thus would be likely to

comply with a request from Drew that they testify. See id. at

458. Several witnesses already have been deposed and thousands

of pages already have been produced in connection with

jurisdictional discovery, with no serious forum-related problems

reported or alleged by Drew. Either of the two jurisdictions

would have been an appropriate and efficient forum. The

plaintiff chose New Hampshire, its home state, and the defendant

has not provided a compelling basis for this court to override

that choice. Drew’s request for a venue transfer is therefore

denied.

IV. Conclusion

For the foregoing reasons, Drew’s renewed motion to dismiss

for lack of personal jurisdiction5 is DENIED. That motion’s

request to transfer venue to the District of New Jersey is also

DENIED.

5 Document n o . 3 6 .

18 SO ORDERED.

/ / ___ -_____"^

Jo'seph ___ . ^ 4 t e Uni/ed States District Judge

Dated: October 2 3 , 2009

cc: William D. Pandolph, Esq. John J. Peirano, Esq. Kimberly A . Capadona, Esq. Martha Van Oot, Esq. John G. Vanacore, Esq.

19