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Wang v. YCMG Brands LLC

United States District Court, S.D. Ohio, Western Division

November 17, 2017

Dong Hua Wang, Plaintiff,
YCMG Brands, LLC, et al., Defendants.



         This matter is before the Court on Defendant YCMG Brands, LLC's Motion to Dismiss. (Doc. 12.) Plaintiff Dong Hua Wang filed this action against Defendants YCMG Brands, LLC, YCMG RE Holdings, LLC, Kimoanh Nguyen, and Jimmy Nguyen following never-completed business transactions to recover sums he deposited with Kimoanh Nguyen. Defendant YCMG Brands, the only Defendant to have been properly served with the Complaint, now moves for dismissal based on lack of personal jurisdiction. For the reasons that follow, the Court will GRANT the Motion to Dismiss. The Court also will dismiss the other Defendants, YCMG RE Holdings, Kimoanh Nguyen, and Jimmy Nguyen, for lack of service of process.

         I. BACKGROUND

         A. Complaint Allegations

         The well-pleaded factual allegations in Wang's Complaint are taken as true for purposes of the pending motion. Wang is an Ohio resident. Defendants YCMG Brands and YCMG RE Holdings are domiciled and have their principal places of business in Florida. Defendants Kimoanh Nguyen, and Jimmy Nguyen, residents of Florida, are stockholders and employees of YCMG Brands and YCMG RE Holdings. (Doc. 1 at PageID 2.) For clarity, Kimoanh Nguyen is referred to herein as Kimoanh Nguyen or as Nguyen. Jimmy Nguyen, who is not alleged to have participated directly in the relevant events, always is referred to as Jimmy Nguyen. Wang alleges that Defendants transacted business and contracted to supply services in Ohio, but as set forth below, Wang alleges no facts in the Complaint to support these conclusory allegations. (Id. at PageID 3.)

         Wang and Kimoanh Nguyen have been business partners since 2012. Between March 2013 and November 2013, Nguyen contacted Wang about numerous commercial leasing opportunities, all of which required Wang to pay fees in advance. (Id. at PageID 4.) In March 2013, Nguyen, doing business as “YCMG, LLC, ” proposed a yogurt kiosk store at a mall in Elmhurst, New York that required Wang to deposit $35, 000 with Nguyen. Wang wired the money to Nguyen. (Id.) In June 2013, Nguyen, again doing business as “YCMG, LLC, ” proposed a nail salon business at a mall in New Jersey that required Wang to deposit a $20, 000 leasing fee. Wang paid the fee by direct deposit. (Id.) Wang deposited an additional $55, 000 for “key money” with Nguyen between June 25, 2013 and July 11, 2013 for the nail salon. (Id.) The nail salon project fell through in October 2013, but, instead of returning the deposited funds to Wang, Nguyen transferred the $75, 000 to the yogurt kiosk store. (Id. at PageID 5.) In November 2013, Nguyen, again doing business as “YCMG, LLC, ” required Wang to pay a “turnkey” fee of $175, 000 for the yogurt kiosk store. (Id.) Wang transferred an additional $84, 000 to Nguyen between November 21, 2013 and December 26, 2013. In total, Wang deposited $194, 000 with Nguyen through the end of 2013. (Id.)

         On or about December 20, 2013, Nguyen forwarded a lease agreement for the yogurt kiosk store to Wang for review. Wang accepted the proposed lease. (Id.) Construction on the yogurt kiosk allegedly began in January 2014. (Id.) However, Wang was required to pay an additional $39, 195 in February 2014 for unspecified construction problems, bringing the total he had deposited to $233, 195. (Id. at PageID 6.) In October 2014, Nguyen told Wang that the landlord had terminated the yogurt kiosk lease and paid $50, 000 in compensation for the lease termination. (Id.) Wang did not receive any part of that compensation from the landlord or from Defendants, despite making demands for a return of the $233, 195 he deposited with Nguyen. (Id.) Nguyen promised in December 2014 to seek out opportunities for Wang at a mall in Florence, Kentucky using the $233, 195 already deposited. (Id.) However, up to the date of the Complaint, Nguyen had not secured any leases or developed any businesses for Wang, nor reimbursed Wang the $233, 195 he had deposited. (Id.)

         At all relevant times, Nguyen acted in the course and scope of her employment with YCMG Brands and YCMG RE Holdings. (Id.) Jimmy Nguyen was married to and acted in concert with Kimoahn Nguyen. (Id. at PageID 7.)

         B. Procedural History and Failure of Service of Process

         Wang initiated this action on January 4, 2017. (Doc. 1.) He asserted claims for (1) breach of contract, (2) fraudulent inducement, (3) fraud, (4) unjust enrichment, (5) “civil remedies for criminal practices” pursuant to Florida Statute Sections 772.11 and 812.14, (6) vicarious liability, (7) piercing the corporate veil/alter ego, and (8) punitive damages. (Id. at PageID 7-14.)

         Wang did not serve the named Defendants with a summons and a copy of the Complaint within 90 days after the Complaint was filed. Rule 4(m) of the Federal Rules of Civil Procedure states that if a defendant is not timely served, then the court must dismiss the action without prejudice or grant the plaintiff further time to effect service. Therefore, the Court issued an Order on June 19, 2017 directing Wang to show cause by July 5, 2017 why the case should not be dismissed pursuant to Rule 4(m). (Doc. 3 at PageID 20.) In response, Wang prepared a summons on June 30, 2017 as to YCMG Brands and Kimoanh Nguyen only, and he filed a Response brief with the Court. (Docs. 4, 5.) Wang never prepared a summons as to YCMG RE Holdings or Jimmy Nguyen. The summons was returned executed on July 6, 2017 only as to YCMG Brands. (Doc. 7 at PageID 27.) Wang's failure to obtain service on YCMG RE Holdings, Kimoanh Nguyen, and Jimmy Nguyen prevents the Court from exercising jurisdiction over them. See King v. Taylor, 694 F.3d 650, 655 (6th Cir. 2012); Ecclesiastical Order of the Ism of Am, Inc. v. Chasin, 845 F.2d 113, 116 (6th Cir. 1988) (applying Fed.R.Civ.P. 4). Accordingly, the Court dismisses the claims against YCMG RE Holdings, Kimoanh Nguyen, and Jimmy Nguyen pursuant to Rule 4(m).[1]

         YCMG Brands filed the pending Motion to Dismiss for lack of personal jurisdiction on August 11, 2017. Wang opposes dismissal. The matter is fully briefed and ripe for adjudication.


         Federal Rule of Civil Procedure 12(b)(2) authorizes a defendant to move for dismissal based on lack of personal jurisdiction. The plaintiff bears the burden of proving that the court can exercise personal jurisdiction over the defendant. Intera Corp. v. Henderson, 428 F.3d 605, 615 (6th Cir. 2005). When a district court exercises its discretion to hold an evidentiary hearing on the jurisdiction issue, then the plaintiff must establish jurisdiction by a preponderance of the evidence. Dean v. Motel 6 Operating L.P., 134 F.3d 1269, 1272 (6th Cir. 1998). On the other hand, where facts are disputed and the district court bases its decision solely on the basis of written submissions without an evidentiary hearing, then “the plaintiff's burden is solely to make a prima facie showing that jurisdiction exists.” Stolle Mach. Co., LLC v. RAM Precision Indus., 605 F. App'x 473, 479-80 & n.5 (6th Cir. 2015). “Under these circumstances, this court will not consider facts ...

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