Jones v. Progressive Casualty Insurance Company et alMOTION to Dismiss for Lack of Jurisdiction both Subject Matter and PersonalN.D. Cal.March 2, 2017 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 GEOFFREY M. EZGAR (State Bar No. 184243) gezgar@kslaw.com KING & SPALDING LLP 601 South California Avenue, Suite 100 Palo Alto, CA 94304 Telephone: (650) 422-6700 Fax: (650) 422-6800 JEFFREY S. CASHDAN (Admitted Pro Hac Vice) jcashdan@kslaw.com ZACHARY A. McENTYRE (Admitted Pro Hac Vice) zmcentyre@kslaw.com JULIA C. BARRETT (Admitted Pro Hac Vice) jbarrett@kslaw.com KING & SPALDING LLP 1180 Peachtree St. Atlanta, GA 30309 Telephone: (404) 572 4600 Facsimile: (404) 572 5100 Counsel for Defendant THE PROGRESSIVE CORPORATION UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA BOBBY JONES, individually and on behalf of all other similarly situated, Plaintiffs, v. PROGRESSIVE CASUALTY INSURANCE COMPANY, THE PROGRESSIVE CORPORATION, and MITCHELL INTERNATIONAL, INC.; and DOES 1 through 50, inclusive, Defendants, Case No. 3:16-cv-06941 JD NOTICE OF THE PROGRESSIVE CORPORATION’S MOTION AND MOTION TO DISMISS FIRST AMENDED COMPLAINT FOR LACK OF SUBJECT MATTER JURISDICTION AND PERSONAL JURISDICTION; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT Date: May 18, 2017 Time: 10:00 a.m. Dept: 11 Judge: Hon. James Donato Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 1 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD i 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF CONTENTS Page NOTICE OF MOTION AND MOTION ........................................................................................ 1 MEMORANDUM OF POINTS AND AUTHORITIES ................................................................ 1 I. STATEMENT OF ISSUES TO BE DECIDED ................................................................. 1 II. INTRODUCTION .............................................................................................................. 1 III. RELEVANT FACTUAL BACKGROUND ....................................................................... 3 A. The Progressive Corporation .................................................................................. 3 B. Plaintiff’s Claims .................................................................................................... 3 IV. ARGUMENT ...................................................................................................................... 5 A. The Court Lacks Subject Matter Jurisdiction Over The Progressive Corporation. 5 B. The Court Lacks Personal Jurisdiction Over The Progressive Corporation ........... 7 1. The Court Does Not Have General or Specific Jurisdiction Over The Progressive Corporation .............................................................................. 8 2. The Court Does Not Have Jurisdiction Over The Progressive Corporation By Virtue of Its Subsidiaries’ Conduct in The Forum ................................ 9 IV. CONCLUSION ................................................................................................................. 11 Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 2 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD ii 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Page(s) Cases Ambriz v. Coca-Cola Co., Case No. 13-cv-03539-JST, 2014 WL 296159 (N.D. Cal. Jan. 27, 2014) ................................9 AT & T Co. v. Compagnie Bruxelles Lambert, 94 F.3d 586 (9th Cir. 1996) .....................................................................................................10 Bauman v. DaimlerChrysler Corp., 644 F.3d 909 (9th Cir. 2011) .....................................................................................................7 Cahen v. Toyota Motor Corp., Case No. 15-cv-01104-WHO, 2015 WL 7566806 (N.D. Cal. Nov. 25, 2015) .........................8 Cattie v. Wal-Mart Stores, Inc., 504 F. Supp. 2d 939 (S.D. Cal. 2007) ........................................................................................6 Chan v. Soc’y Expeditions, Inc., 39 F.3d 1398 (9th Cir. 1994), rev’d on other grounds by Daimler AG v. Bauman, 134 S. Ct. 746 (2014)..................................................................................................7 Corcoran v. CVS Health Corp., 169 F. Supp. 3d 970, 983 (N.D. Cal. 2016) .............................................................................10 Doe v. Unocal Corp., 248 F.3d 915 (9th Cir. 2001) ...........................................................................................7, 8, 10 Easter v. Am. West Fin., 381 F.3d 948 (9th Cir. 2004) .....................................................................................................6 Int’l Shoe Co. v. State of Wash., Office of Unemp’t Comp. & Placement, 326 U.S. 310 (1945) ...................................................................................................................7 Lee v. Am. Nat’l Ins. Co., 260 F.3d 997 (9th Cir. 2001) .....................................................................................................6 Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) ...................................................................................................................5 Martinez v. Aero Caribbean, 764 F.3d 1062 (9th Cir. 2014), cert. denied, 135 S. Ct. 2310 (2015) ........................................8 Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 3 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD iii 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 National Union Fire Ins. Co. of Pittsburgh, Pa. v. Tokio Marine & Nichido Fire Ins. Co., Ltd., No. 10CV1733 JLS (CAB), 2011 WL 347026 (S.D. Cal. Feb. 1, 2011) ..................................5 Pebble Beach Co. v. Caddy, 453 F.3d 1151 (9th Cir. 2006) ...................................................................................................7 Perez v. State Farm Mut. Auto. Ins. Co., No. C 06 01962 JW, 2011 WL 5833636 (N.D. Cal. Nov. 15, 2011) ........................................6 Ranza v. Nike, Inc., 793 F.3d 1059 (9th Cir. 2015) .............................................................................................9, 10 Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007 (9th Cir. 2002) ...................................................................................................7 Stewart v. Screen Gems-EMI Music, Inc., 81 F. Supp. 3d 938, 949 (N.D. Cal. 2015) .................................................................................7 Table Bluff Reservation (Wiyot Tribe) v. Philip Morris, Inc., 256 F.3d 879 (9th Cir. 2001) .....................................................................................................5 Takhar v. Kessler, 76 F.3d 995 (9th Cir. 1996) .......................................................................................................5 White v. Lee, 227 F.3d 1214 (9th Cir. 2000) ...................................................................................................5 Statutes 28 U.S.C. §§ 1331 and 1332 ............................................................................................................4 Cal. Business and Professions Code § 17200, et seq. ......................................................................4 Cal. Civ. Proc. Code § 410.10 .........................................................................................................7 Other Authorities Federal Rule of Civil Procedure 12(b)(1) ....................................................................................1, 5 Federal Rule of Civil Procedure 12(b)(2) ....................................................................................1, 7 United States Constitution Article III ..................................................................................1, 2, 5, 6 Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 4 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOTICE OF MOTION AND MOTION PLEASE TAKE NOTICE that on May 18, 2017 at 10:00 a.m., or at such date as may be agreed upon or ordered, Defendant The Progressive Corporation will and hereby does move to dismiss Plaintiff’s First Amended Complaint (“FAC”) for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1) and lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). The Progressive Corporation’s motion is based on the following Memorandum of Points and Authorities, the FAC, all documents attached to the FAC, and the Declaration of Michael R. Uth filed herewith. The Progressive Corporation respectfully requests that the Court dismiss Plaintiff’s claims against The Progressive Corporation. MEMORANDUM OF POINTS AND AUTHORITIES I. STATEMENT OF ISSUES TO BE DECIDED 1. Does the Court lack subject matter jurisdiction over The Progressive Corporation because Plaintiff has no standing to assert her claims under Article III of the United States Constitution? 2. Does the Court lack personal jurisdiction over The Progressive Corporation because The Progressive Corporation is a foreign corporation that has no contacts with California? II. INTRODUCTION Plaintiff asserts four claims against Progressive Casualty Insurance Co. (“Progressive Casualty”) and The Progressive Corporation. Plaintiff’s claims are predicated on his contention that “Progressive”—a term Plaintiff uses generically to describe both Progressive Casualty and The Progressive Corporation—allegedly violated a California insurance regulation governing the valuation of total loss vehicles in handling Plaintiff’s total loss claim (10 C.C.R. § 2695.8, the “Total Loss Regulation”). Yet, Plaintiff was not insured by either Progressive Casualty or The Progressive Corporation—he was insured under a policy issued by Progressive Direct Insurance Company (“PDIC”), which is a separate entity that is not a defendant in this lawsuit. Plaintiff’s Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 5 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 claims against Progressive Casualty fail as a matter of law for the reasons explained in Progressive Casualty’s contemporaneously filed motion to dismiss. Plaintiff’s claims against The Progressive Corporation additionally fail for wholly independent reasons—namely, because this Court lacks both subject matter jurisdiction and personal jurisdiction over The Progressive Corporation. The Progressive Corporation is a non-operating insurance holding company incorporated in Ohio. The Progressive Corporation does not write insurance policies or have any contacts with individual insureds, such as Plaintiff. And the face of Plaintiff’s Policy confirms that his Policy was not issued by The Progressive Corporation. In fact, Plaintiff does not—and cannot— allege that he had any relationship with or contacts with The Progressive Corporation, or that The Progressive Corporation engaged in any of the conduct allegedly causing Plaintiff’s purported injury. Accordingly, Plaintiff cannot establish any causal connection between The Progressive Corporation and his alleged injury—i.e., receiving less for his total loss vehicle than he would have liked. Nor can Plaintiff establish that his ostensible injury was “fairly traceable” to any act of The Progressive Corporation. Accordingly, Plaintiff lacks Article III standing to assert his claims against The Progressive Corporation and this Court lacks subject matter jurisdiction to adjudicate those claims. The Court also lacks personal jurisdiction over The Progressive Corporation. The Progressive Corporation is an Ohio corporation that has no contacts with California. Plaintiff does not even allege otherwise—instead, he attempts to bootstrap jurisdiction over The Progressive Corporation by treating it indistinguishably from Progressive Casualty. But Plaintiff does not and cannot allege facts sufficient to establish that The Progressive Corporation is Progressive Casualty’s “alter ego,” as would be required for the Court to exercise personal jurisdiction over the former based on the latter’s contacts with California. Plaintiff’s claims against The Progressive Corporation should be dismissed. Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 6 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 III. RELEVANT FACTUAL BACKGROUND A. The Progressive Corporation The Progressive Corporation is a non-operating insurance holding company incorporated in Ohio, with its principal place of business in Mayfield Village, Ohio. Declaration of Michael R. Uth ¶ 4 (“Decl.”). The Progressive Corporation is not engaged in the insurance business. Id. ¶ 7. It does not write any insurance policies, in California or elsewhere, including the Policy. Id. It does not hold a license to sell insurance in California or any other state. Id. For that matter, it does not transact any business in California, own any property in California, or have any employees in California. Id. ¶ 6. While The Progressive Corporation has subsidiaries, as part of a holding company group, that write insurance policies in California, those subsidiaries are separate companies that are distinct from The Progressive Corporation. Id. ¶¶ 8-9. The Progressive Corporation does not exercise any significant degree of control over its subsidiaries. Id. It does not manage their assets, supervise their employees, or control their day-to-day operations. Id. ¶ 8. Each of The Progressive Corporation’s subsidiaries has its own financial reserves. Id. ¶ 9. Accordingly, each subsidiary of The Progressive Corporation pays for its own losses. Id. The capital and assets of each of The Progressive Corporation’s subsidiaries are accounted for separately, using generally accepted accounting practices. Id. B. Plaintiff’s Claims Plaintiff effectively acknowledges that The Progressive Corporation is simply a holding company for Progressive Casualty. FAC ¶ 8 (alleging that Progressive Casualty “is a group of insurance companies operating under the umbrella of The Progressive Corporation”); see also Decl. ¶ 10 (“Progressive Casualty Insurance Company is . . . a subsidiary of The Progressive Corporation”). Nevertheless, rather than identifying the specific entity that issued his Policy, Plaintiff generically refers to Progressive Casualty and The Progressive Corporation as “Progressive” throughout the FAC. See, e.g., FAC ¶¶ 8, 26-28 (alleging that he held a Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 7 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 “Progressive automobile insurance policy”). The face of the Policy reflects that it was issued by PDIC, which is a separate corporate entity from both Progressive Casualty and The Progressive Corporation. Decl. ¶ 11. Other than generalized allegations about “Progressive,” Plaintiff does not allege (and cannot allege) that he has any relationship with The Progressive Corporation or that The Progressive Corporation engaged in any conduct implicated by Plaintiff’s claims. Decl. ¶¶ 4, 7. To the contrary, Plaintiff’s claims are predicated on his contention that “Progressive Casualty Insurance Company and Mitchell International Inc. have engaged in unlawful, unfair and deceptive business practices which facilitate and enable them present [sic] ‘lowball’ property damage offers to its insured [sic] where there is a total loss situation.” FAC ¶ 4. On the basis of this contention, Plaintiff asserts claims against Progressive Casualty and The Progressive Corporation for fraud, negligent misrepresentation, breach of contract, and a violation of California’s Business and Professions Code § 17200, et seq. (“UCL”). Plaintiff summarily alleges that this Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1332, and that venue is proper because “Defendants regularly transact business and solicit business in this District,” “Defendant resides here,” and “a substantial part of the events and omissions giving rise to this action occurred in this District.” FAC ¶¶ 12-15. Plaintiff does not allege that that this Court has personal jurisdiction over The Progressive Corporation, in particular, much less the basis for the Court’s personal jurisdiction (i.e., whether the Court’s jurisdiction would be “general” or “specific”), or any facts that would support either general or specific jurisdiction over The Progressive Corporation. Nor does Plaintiff allege that The Progressive Corporation issues any insurance policies in California, has employees in California, or otherwise does any business in California. Plaintiff’s only specific allegation concerning The Progressive Corporation is that “Progressive Casualty Insurance Company is a group of insurance companies operating under the umbrella of The Progressive Corporation.” FAC ¶ 8. Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 8 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 IV. ARGUMENT A. The Court Lacks Subject Matter Jurisdiction Over The Progressive Corporation. The Court should dismiss the claims against The Progressive Corporation for lack of subject matter jurisdiction because Plaintiff does not have standing to assert those claims. National Union Fire Ins. Co. of Pittsburgh, Pa. v. Tokio Marine & Nichido Fire Ins. Co., Ltd., No. 10CV1733 JLS (CAB), 2011 WL 347026, at *1 (S.D. Cal. Feb. 1, 2011) (“[B]ecause standing ‘pertain[s] to a federal court’s subject matter jurisdiction under Article III, [it is] properly raised in a motion to dismiss under Federal Rule of Civil procedure 12(b)(1).’”). “Rule 12(b)(1) jurisdiction attacks can be either facial or factual.” White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000). With a factual attack, “a court may look beyond the complaint to matters of public record,” and “need not presume the truthfulness of the plaintiff’s allegations.” Id. Specifically, in assessing standing, the court may consider “the complaint and any other particularized allegations of fact, in affidavits or in amendments to the complaint.” Table Bluff Reservation (Wiyot Tribe) v. Philip Morris, Inc., 256 F.3d 879, 882 (9th Cir. 2001). Plaintiff “has the burden of establishing the elements required for standing,” including (1) that he “suffered an ‘injury in fact’ . . . which is [] concrete and particularized,” (2) a “causal connection between the injury and the conduct complained of,” and (3) that the injury is “fairly . . . trace[able] to the challenged action of the defendant.” Takhar v. Kessler, 76 F.3d 995, 1000 (9th Cir. 1996) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)). At a minimum, Plaintiff cannot establish the second and third of these required elements because he has no relationship with The Progressive Corporation giving rise to any cognizable legal rights. As a result, Plaintiff does not allege—and cannot allege—that any “injury in fact” he purportedly incurred was caused by The Progressive Corporation or “fairly . . . traceable” to any action by The Progressive Corporation. Plaintiff’s sole purported injury is that he received less money for his total loss vehicle than he would have liked under his insurance agreement as a result of Progressive Casualty’s Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 9 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 alleged violation of the Total Loss Regulation. See FAC ¶¶ 4-6, 35. But Plaintiff does not—and, as the face of the Policy demonstrates, cannot—allege that The Progressive Corporation insured him or is even a party to his insurance agreement. See FAC, Ex. A; Decl. ¶ 7. In fact, nowhere in the FAC does Plaintiff specifically allege any causal connection between this purported injury and The Progressive Corporation. Nor could he: The Progressive Corporation is a non- operating holding company that is not engaged in the insurance business. Decl. ¶ 4, 7. The Progressive Corporation, therefore, could not have breached any contract with Plaintiff, made any alleged misrepresentation to Plaintiff, or engaged in any of the “business practices” forming the basis of Plaintiff’s claims. Decl. ¶¶ 4, 6-7. “Where a plaintiff ‘did not buy any [insurance] policy from [an insurance company defendant] and so did not suffer any injury due to [that company’s] conduct,’ that plaintiff lacks Article III standing to bring a case in relation to an insurance policy against that defendant.” Perez v. State Farm Mut. Auto. Ins. Co., No. C 06 01962 JW, 2011 WL 5833636, at *2 (N.D. Cal. Nov. 15, 2011) (quoting Lee v. Am. Nat’l Ins. Co., 260 F.3d 997, 1001–02 (9th Cir. 2001)). Because Plaintiff cannot establish any causal connection between his purported injury and any conduct of The Progressive Corporation, or that his purported injury is fairly traceable to conduct by The Progressive Corporation, he lacks standing to sue The Progressive Corporation, and his claims against The Progressive Corporation should be dismissed. See Lee, 260 F.3d at 1001–02; see also Cattie v. Wal-Mart Stores, Inc., 504 F. Supp. 2d 939, 944 (S.D. Cal. 2007) (plaintiff lacked standing to state a claim against Wal-Mart Stores because she never “adequately alleged” that she “had any business relationship at all with Wal-Mart Stores”); Easter v. Am. West Fin., 381 F.3d 948, 961-62 (9th Cir. 2004) (dismissing claims for lack of standing where plaintiffs failed to trace the alleged injury-in-fact to the conduct of certain defendants). Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 10 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 B. The Court Lacks Personal Jurisdiction Over The Progressive Corporation. The Court also should dismiss Plaintiff’s claims against The Progressive Corporation under Federal Rule of Civil Procedure 12(b)(2) because the Court lacks personal jurisdiction over The Progressive Corporation. “Although the defendant is the moving party on a motion to dismiss [for lack of personal jurisdiction], the plaintiff bears the burden of establishing that jurisdiction exists.” Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002). “A trial court may rule on the issue of personal jurisdiction by relying on affidavits and discovery materials,” and dismissal is appropriate if the plaintiff “has not made a prima facie showing of personal jurisdiction.” Stewart v. Screen Gems-EMI Music, Inc., 81 F. Supp. 3d 938, 949 (N.D. Cal. 2015). “In evaluating the appropriateness of personal jurisdiction over a nonresident defendant, [courts] ordinarily examine whether such jurisdiction satisfies the ‘requirements of the applicable state long-arm statute’ and ‘comport[s] with federal due process.’” Bauman v. DaimlerChrysler Corp., 644 F.3d 909, 919 (9th Cir. 2011) (alteration in original) (quoting Chan v. Soc’y Expeditions, Inc., 39 F.3d 1398, 1404-05 (9th Cir. 1994), rev’d on other grounds by Daimler AG v. Bauman, 134 S. Ct. 746, 754 (2014)). The California long-arm statute “permits the exercise of personal jurisdiction to the full extent permitted by due process.” Id. (internal citation and quotation marks omitted); see Cal. Civ. Proc. Code § 410.10 (“A court of this state may exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United States.”). “For due process to be satisfied, a defendant, if not present in the forum, must have ‘minimum contacts’ with the forum state such that the assertion of jurisdiction ‘does not offend traditional notions of fair play and substantial justice.’” Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1155 (9th Cir. 2006) (quoting Int’l Shoe Co. v. State of Wash., Office of Unemp’t Comp. & Placement, 326 U.S. 310, 315 (1945)). “Applying the ‘minimum contacts’ analysis, a court may obtain either general or specific jurisdiction over a defendant.” Doe v. Unocal Corp., 248 F.3d 915, 923 (9th Cir. 2001). Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 11 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 “If the defendant’s activities in the forum are substantial, continuous and systematic, general jurisdiction is available; in other words, the foreign defendant is subject to suit even on matters unrelated to his or her contacts to the forum.” Id. Here, the Court has neither general nor specific jurisdiction over The Progressive Corporation. 1. The Court Does Not Have General or Specific Jurisdiction Over The Progressive Corporation. As the Supreme Court recently clarified, the standard for imposing general jurisdiction over a foreign defendant is rigorous: “continuous and systematic” contacts between a defendant and the forum are not sufficient unless those contacts are so significant that they render the defendant “at home” in the jurisdiction. Daimler, 134 S. Ct. at 754. Only in an “exceptional case” will a court have general jurisdiction over a defendant that is incorporated and has its principal place of business in another state. Id. at 761 n.19 (emphasis added). This Court does not have general jurisdiction over The Progressive Corporation because The Progressive Corporation is not “at home” in California. The Progressive Corporation is an Ohio corporation with its principal place of business in Ohio. Decl. ¶ 4. Under Daimler, “[t]hese facts, alone, are strong evidence that [The Progressive Corporation] is not at home in California.” See Cahen v. Toyota Motor Corp., Case No. 15-cv- 01104-WHO, 2015 WL 7566806, at *6 (N.D. Cal. Nov. 25, 2015); Daimler, 134 S. Ct. at 760 (“With respect to a corporation, the place of incorporation and the principal place of business are ‘paradig[m] . . . bases for general jurisdiction.’”). Since the Supreme Court’s decision in Daimler, federal courts have recognized the difficulty a plaintiff faces in establishing that general jurisdiction exists over a company anywhere other than the company’s state of incorporation or principal place of business. See, e.g., Martinez v. Aero Caribbean, 764 F.3d 1062, 1070 (9th Cir. 2014), cert. denied, 135 S. Ct. 2310 (2015) (noting that “[o]nly in an ‘exceptional case’ will general jurisdiction be available anywhere [other than the state of incorporation and/or principal place of business]”). Plaintiff alleges no facts suggesting that The Progressive Corporation represents an “exceptional case” of a foreign defendant that is “at home” in California—because Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 12 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the FAC does not include any allegations that The Progressive Corporation does business in California. The Progressive Corporation is a non-operating insurance holding company, which does not conduct any insurance activity in California or anywhere else. Decl. ¶¶ 4, 6-7; see also FAC ¶ 8. Similarly, Plaintiff cannot establish specific jurisdiction over The Progressive Corporation. A court may exercise specific jurisdiction “when a case ‘aris[es] out of or relate[s] to the defendant’s contact with the forum.’” Ranza v. Nike, Inc., 793 F.3d 1059, 1068 (9th Cir. 2015). In a putative class action, the “defendant’s contacts with the named plaintiff . . . without reference to the defendant’s contacts with unnamed members of the proposed class, must be sufficient for the Court to exercise specific personal jurisdiction over the defendant.” Ambriz v. Coca-Cola Co., Case No. 13-cv-03539-JST, 2014 WL 296159, at *6 (N.D. Cal. Jan. 27, 2014). Specific jurisdiction “depends on an affiliation between the forum and the underlying controversy, principally, activity or an occurrence that takes place in the forum State and is therefore subject to the State’s regulation.” Id. at *5 (internal quotation marks omitted). Because Plaintiff does not and cannot allege that The Progressive Corporation has engaged in any conduct in California, much less any conduct giving rise to the claims in the FAC, this Court may not exercise either general or specific jurisdiction over The Progressive Corporation. 2. The Court Does Not Have Jurisdiction Over The Progressive Corporation By Virtue of Its Subsidiaries’ Conduct in The Forum. Absent any allegations that The Progressive Corporation engaged in any conduct in California, the sole ostensible basis for personal jurisdiction appears to be Plaintiff’s allegation that Progressive Casualty—an entity that did not issue Plaintiff’s insurance Policy—operates “under the umbrella of The Progressive Corporation”—another entity that did not issue Plaintiff’s insurance Policy or otherwise have any contacts with Plaintiff. FAC ¶ 8. That is not enough. The “existence of a relationship between a parent company and its subsidiaries is not sufficient to establish personal jurisdiction over the parent on the basis of the subsidiaries’ Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 13 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 minimum contacts with forum.” See Doe, 248 F.3d at 925; accord Ranza, 793 F.3d at 1070 (“The existence of a parent-subsidiary relationship is insufficient, on its own, to justify imputing one entity’s contacts with a forum state to another for the purpose of establishing personal jurisdiction.”). Instead, the proponent of jurisdiction must establish that “parent and subsidiary are ‘not really separate entities,’ such that one entity’s contacts with the forum state can be fairly attributed to the other.” Ranza, 793 F.3d at 1071 (quoting Doe, 248 F.3d at 926). “To satisfy the alter ego test, a plaintiff ‘must make out a prima facie case “(1) that there is such unity of interest and ownership that the separate personalities [of the two entities] no longer exist and (2) that failure to disregard [their separate identities] would result in fraud or injustice.”’” Id. at 1073 (quoting Doe, 248 F.3d at 926 (alterations in original) (quoting AT & T Co. v. Compagnie Bruxelles Lambert, 94 F.3d 586, 591 (9th Cir. 1996))). The “alter ego” test thus “requires a showing that the parent controls the subsidiary to such a degree as to render the latter the mere instrumentality of the former” because the “parent corporation dictates every facet of the subsidiary’s business.” Corcoran v. CVS Health Corp., 169 F. Supp. 3d 970, 983 (N.D. Cal. 2016) (internal quotation marks omitted). Plaintiff does not—and cannot—clear this high hurdle. Plaintiff does not allege that The Progressive Corporation exercised any control over its subsidiaries doing business in California, let alone the kind of “pervasive control” that would justify disregarding the corporate forms of both Progressive Casualty and The Progressive Corporation. Corocan, 169 F. Supp. at 983. The Progressive Corporation is not engaged in the insurance business, and has only limited, non- insurance-related interactions with its subsidiaries. Decl. ¶¶ 7-9. The Progressive Corporation does not perform any management functions for its subsidiaries. Id. ¶ 8. It does not manage its subsidiaries’ assets, supervise their employees, or control their day-to-day operations. Id. It does not pay their losses. Id. ¶ 9. Each subsidiary of The Progressive Corporation accounts for its capital and assets separately, and each maintains its own financial reserves. Id. In short, The Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 14 of 15 Progressive Corp.’s Motion to Dismiss Case No. 3:16-CV-06941 JD 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Progressive Corporation “observe[s] all of the corporate formalities necessary to maintain corporate separateness.” Corocan, 169 F. Supp. 3d at 983. The Court does not have general or specific jurisdiction over The Progressive Corporation on its own, and the Court cannot exercise jurisdiction over The Progressive Corporation merely because it has separate and independent subsidiaries doing business in California. Accordingly, the Court should dismiss Plaintiff’s claims against The Progressive Corporation. IV. CONCLUSION For the foregoing reasons, The Progressive Corporation respectfully requests that the Court grant the motion and dismiss with prejudice Plaintiff’s claims against it under Federal Rules of Civil Procedure 12(b)(1) and (b)(2). Respectfully submitted this 2nd day of March, 2017. KING & SPALDING LLP By: /s/ Geoffrey M. Ezgar Geoffrey M. Ezgar Counsel for Defendant THE PROGRESSIVE CORPORATION Case 3:16-cv-06941-JD Document 36 Filed 03/02/17 Page 15 of 15 Decl. of Uth ISO Progressive Corp.’s MTD Case No. 3:16-CV-06941 JD 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 GEOFFREY M. EZGAR (State Bar No. 184243) gezgar@kslaw.com KING & SPALDING LLP 601 South California Avenue, Suite 100 Palo Alto, CA 94304 Telephone: (650) 422-6700 Fax: (650) 422-6800 Counsel for Defendant THE PROGRESSIVE CORPORATION UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA BOBBY JONES, individually and on behalf of all other similarly situated, Plaintiffs, v. PROGRESSIVE CASUALTY INSURANCE COMPANY, THE PROGRESSIVE CORPORATION, and MITCHELL INTERNATIONAL, INC.; and DOES 1 through 50, inclusive, Defendants, Case No. 3:16-cv-06941 JD DECLARATION OF MICHAEL R. UTH IN SUPPORT OF THE PROGRESSIVE CORPORATION’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION AND PERSONAL JURISDICTION Date: May 18, 2017 Time: 10:00 a.m. Dept: 11 Judge: Hon. James Donato I, Michael R. Uth, state the following facts are true and accurate to the best of my knowledge and belief. 1. My name is Michael R. Uth. I am over the age of eighteen (18), and I am competent in all respects to make this declaration. 2. I am Deputy General Counsel for The Progressive Corporation. I have occupied this position or a substantially similar position since January 1991. 3. In this role, I am familiar with the structure of The Progressive Corporation, as well as other corporate defendants named in this action. Case 3:16-cv-06941-JD Document 36-1 Filed 03/02/17 Page 1 of 3 Decl. of Uth ISO Progressive Corp.’s MTD Case No. 3:16-CV-06941 JD 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4. The Progressive Corporation is a non-operating insurance holding company incorporated under the laws of the State of Ohio with its principal place of business in Mayfield Village, Ohio. 5. The Progressive Corporation’s subsidiaries are part of a holding company group. Each separate company in the group complies with all applicable State Insurance Holding Company Acts, including but not limited to the requirements pertaining to the filing of intercompany agreements and transactions. 6. The Progressive Corporation does not do business in the State of California, does not own any property in the State of California, and does not have any employees located in the State of California. 7. The Progressive Corporation is not engaged in the insurance business. It does not hold a license to sell insurance in any state. The Progressive Corporation thus does not write insurance policies, and did not issue the policy at issue in the above-styled action. 8. The Progressive Corporation does not perform management functions for The Progressive Corporation’s subsidiaries. The Progressive Corporation does not manage the assets, supervise the employees, or control the day-to-day operations of these separate companies. 9. The capital and assets of each individual insurance subsidiary and affiliate of The Progressive Corporation are accounted for separately using generally accepted accounting practices. The Progressive Corporation does not pay for the losses of its subsidiaries but rather each has its own financial reserves. 10. The Progressive Casualty Insurance Company is, and was at the time the First Amended Complaint was filed in the above-styled action, a subsidiary of The Progressive Corporation and a corporation duly organized and validly existing under the laws of the State of Ohio, which maintains its principal place of business in Ohio. Case 3:16-cv-06941-JD Document 36-1 Filed 03/02/17 Page 2 of 3 Decl. of Uth ISO Progressive Corp.’s MTD Case No. 3:16-CV-06941 JD 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11. The policy at issue in the above-styled action was issued by Progressive Direct. Progressive Direct is a separate corporate entity from Progressive Casualty and from The Progressive Corporation. I declare under penalty of perjury that the foregoing is true and correct. Executed on February 21, 2017 Case 3:16-cv-06941-JD Document 36-1 Filed 03/02/17 Page 3 of 3 [PROPOSED] ORDER GRANTING THE PROGRESSIVE CORP.’S MOTION TO DISMISS Case No. 3:16-cv-06941 JD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 GEOFFREY M. EZGAR (State Bar No. 184243) gezgar@kslaw.com KING & SPALDING LLP 601 South California Avenue, Suite 100 Palo Alto, CA 94304 Telephone: (650) 422-6700 Fax: (650) 422-6800 JEFFREY S. CASHDAN (Admitted Pro Hac Vice) jcashdan@kslaw.com ZACHARY A. MCENTYRE (Admitted Pro Hac Vice) zmcentyre@kslaw.com JULIA C. BARRETT (Admitted Pro Hac Vice) jbarrett@kslaw.com KING & SPALDING LLP 1180 Peachtree St. Atlanta, GA 30309 Telephone: (404) 572 4600 Facsimile: (404) 572 5100 Counsel for Defendant The Progressive Corporation UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA BOBBY JONES, individually and on behalf of all other similarly situated, Plaintiffs, v. PROGRESSIVE CASUALTY INSURANCE COMPANY, THE PROGRESSIVE CORPORATION, and MITCHELL INTERNATIONAL, INC.; and DOES 1 through 50, inclusive, Defendants, Case No. 3:16-cv-06941 JD [PROPOSED] ORDER GRANTING THE PROGRESSIVE CORPORATION’S MOTION TO DISMISS FIRST AMENDED COMPLAINT Date: May 18, 2017 Time: 10 a.m. Dept: 11 Judge: Honorable James Donato Case 3:16-cv-06941-JD Document 36-2 Filed 03/02/17 Page 1 of 2 2 [PROPOSED] ORDER GRANTING THE PROGRESSIVE CORP.’S MOTION TO DISMISS Case No. 3:16-cv-06941 JD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 [PROPOSED] ORDER On May 18, 2017, the Court heard The Progressive Corporation’s Motion to Dismiss the First Amended Complaint. Having reviewed the parties’ submissions, and having considered all other issues presented to the Court, the Court holds that it lacks personal or subject matter jurisdiction over The Progressive Corporation. Accordingly, IT IS HEREBY ORDERED that Defendant The Progressive Corporation’s Motion to Dismiss is GRANTED and the First Amended Complaint is DISMISSED with prejudice with respect to Defendant The Progressive Corporation. Dated: ____________________, 2017 __________________________________ The Honorable James Donato U.S. District Court Judge, Northern District of California Case 3:16-cv-06941-JD Document 36-2 Filed 03/02/17 Page 2 of 2