ALDEA COMMUNICATIONS, INC., A CALIFORNIA CORPORATION, AND SUSAN ESTRADA, INDIVIDUALLY, APPELLANTS,
v.
JAMES GARDNER, APPELLEE
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Aldea Communications and its president Susan Estrada appealed the trial court's denial of their motion to dismiss for lack of personal jurisdiction. The appellate court affirmed jurisdiction over Aldea but reversed as to Estrada, finding that the complaint failed to allege sufficient facts to pierce the corporate veil under the alter ego theory required to establish jurisdiction over a nonresident shareholder.
The court affirmed the trial court's denial of the motion to dismiss as to Aldea, but reversed as to Estrada. The court held that to establish jurisdiction over a nonresident shareholder under the alter ego theory, the complaint must allege not only that the corporation is a mere instrumentality of the individual defendant, but also that the individual defendant engaged in improper conduct in the formation or use of the corporation. Gardner failed to allege such improper conduct.
[1] A nonresident shareholder of a corporation doing business in Florida may be subject to long-arm jurisdiction under an alter ego theory.
[2] To pierce the corporate veil under an alter ego theory, a complaint must allege facts sufficient to show the corporation is a mere instrumentality of the individual defen…
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Join FLexlaw to unlock all legal intelligence“A nonresident shareholder of a corporation doing business in Florida may be subject to long-arm jurisdiction under an alter ego theory.”
Establishes the legal principle that allows jurisdiction over nonresident shareholders under certain conditions
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Join FLexlaw to unlock all legal intelligenceAldea Communications is a California corporation, and Susan Estrada is its president and shareholder. James Gardner filed a complaint against Aldea fo…
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STRINGER, THOMAS E., Sr., Associate Judge.
Aldea Communications, Inc. (Aldea), a California corporation, and Susan Estrada appeal the order of the trial court denying their motion to dismiss the amended complaint on the ground that they are not subject to personal jurisdiction in the State of Florida. We have jurisdiction pursuant to Florida Rule of Appellate Procedure 9.130(a)(3)(C)(i). We affirm, without discussion, the trial court’s order as it pertains to Aldea, but we agree that the trial court erred in denying the motion to dismiss COUNT III of the complaint in which the appellee, James Gardner, sought money damages against Estrada.
In COUNT I of the complaint, Gardner sought money damages against Al-dea. COUNT II, which was an action against Aldea for quantum meruit, was dismissed by the trial court for failure to state a cause of action. In COUNT III, Gardner sued Estrada alleging that Aldea was the alter ego of Estrada. Estrada is the president and a shareholder of Aldea. A nonresident shareholder of a corporation doing business in Florida may be subject to long-arm jurisdiction under an alter ego theory. See Bellairs v. Mohrmann, 716 So. 2d 320 (Fla. 2d DCA 1998). The complaint, however, “must allege facts sufficient to pierce the corporate veil” of the corporation. Bellairs, 716 So. 2d at 322 (citing Woods v. Jorgensen, 522 So. 2d 935, 937 (Fla. 1st DCA 1988)). The plaintiff must allege not only that the corporation is a “mere instrumentality” of the individual defendant but that the individual defendant engaged in “ ‘improper conduct’ in the formation or use of the corporation.” Bellairs, 716 So. 2d at 323 (citing Dania Jai-Alai Palace, Inc. v. Sykes, 450 So. 2d 1114, 1120-21 (Fla.1984)). Gardner did not allege, in COUNT III of the complaint, that there was any improper conduct such as fraud on the part of Estrada in the formation or use of the corporation.
Because Gardner failed to allege sufficient facts to proceed under an alter ego theory against Estrada, he also failed to plead sufficient facts to subject Estrada to personal jurisdiction in Florida. Accordingly, we reverse the trial court’s order as it pertains to COUNT III of the complaint and remand with instructions for the trial court to dismiss COUNT III without prejudice to Gardner’s amending that count to plead facts sufficient to pierce the corporate veil. See Kapley v. Borchers, 714 So. 2d 1217 (Fla. 2d DCA 1998). If Gardner amends his pleading to allege a jurisdictional basis against Estrada, Estrada may contest these allegations through the procedures outlined in Bellairs.
Affirmed in part, reversed in part, and remanded.
PATTERSON, A.C.J., and DANAHY, PAUL W., (Senior) Judge, Concur.
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WH Smith, PLC v. Benages & Assocs., Inc., 51 So. 3d 577 (Fla. 3d DCA 2010)…ish personal jurisdiction over Smith PLC.1 Under the alter ego theory, “[a] nonresident shareholder of a corporation doing business in Florida may be subject to long-arm jurisdiction” if the alter ego test can be met. Aldea Comm’ns, Inc. v. Gardner, 725 So. 2d 456, 457 (Fla. 2d DCA 1999); see also Bellairs v. Mohrmann, 716 So. 2d 320, 322 (Fla. 2d DCA 1998) (“Under the alter ego theory of long-arm jurisdiction, a nonresident shareholder of a resident corporation may be subject to long-arm jurisdiction where t…
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Sun Tr. Bank v. Sun Int'l Hotels, Ltd., 184 F. Supp. 2d 1246 (S.D. Fla. 2001)…ies are mere instrumentalities of the parent, and b) that the defendants engaged in “improper conduct” in the formation or use of the corporations. MeterLogic, 126 F.Supp.2d at 1357; Aldea Com *1268 munications, Inc. v. Gardner, 725 So.2d 456 (Fla. 2nd DCA 1999). Here, plaintiff has failed to adequately plead sufficient facts to “pierce the corporate veil.” 9 However, the parties’ have conducted extensive discovery on the jurisdictional issue, and the record is fully developed rega…
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Kertesz v. Net Transactions, Ltd., 635 F. Supp. 2d 1339 (S.D. Fla. 2009)…re mere instrumentalities of Net and Westlake and that Net and Westlake used improper conduct in forming or using Ventura and TB. See Dania Jai-Alai Palace, Inc. v. Sykes, 450 So.2d 1114 (Fla.1984); Aldea Communications, Inc. v. Gardner, 725 So.2d 456 (Fla.Dist.Ct.App.1999). The TAC does not allege improper conduct, such as fraud, in the formation or use of these two corporate entities. Thus, because the allegations of the TAC do not meet the requirements for establishing alter ego liability, the…
Previewing 3 of 6 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Dania Jai-Alai Palace, Inc. v. Sykes, 450 So. 2d 1114 (Fla. 1984)
- Kenneth Kapley, D.D.S. v. Borchers, 714 So. 2d 1217 (Fla. 2d DCA 1998)
- Bellairs v. Mohrmann, 716 So. 2d 320 (Fla. 2d DCA 1998)
- Woods v. Jorgensen, 522 So. 2d 935 (Fla. 1st DCA 1988)