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Hausfeld v. Love Funding Corp.

United States District Court, D. Maryland

April 18, 2014


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For Joshua Hausfeld, Plaintiff: Deanna Layne Peters, LEAD ATTORNEY, Stein Sperling Bennett DeJong Driscoll PC, Rockville, MD; Jeffrey M Schwaber, LEAD ATTORNEY, Stein Sperling Bennett De Jong Driscoll and Greenfeig PC, Rockville, MD.

For Love Funding Corporation, Defendant: Alec W Farr, LEAD ATTORNEY, Bryan Cave LLP, Washington, DC.


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DEBORAH K. CHASANOW, United States District Judge.

Presently pending and ready for review in this wage and hour law dispute is the motion to dismiss or, in the alternative, motion to transfer venue, filed by Defendant Love Funding Corporation. (ECF No. 9). The issues have been fully briefed, and the court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, the motion to dismiss will be denied, and Defendant's alternative motion to transfer venue will also be denied.

I. Background

Defendant is a mortgage banking company that offers funding programs for multifamily and affordable housing, healthcare facilities, and hospitals. It is incorporated under the laws of Virginia with its principal place of business in Washington, D.C. Plaintiff is a resident of Maryland. Plaintiff was hired to work in Defendant's Washington, D.C. office on March 27, 2006 as an Underwriter Analyst. In January 2010, Plaintiff was promoted to the position of Loan Originator. As part of that promotion, the parties executed an employment agreement in April 2010 that stated, in part, that he was being provided office space in the Washington, D.C. office and would be reimbursed for business expenses. (ECF No. 9-3). Compensation was structured to provide Plaintiff a base salary plus commissions to be paid quarterly in arrears after the fees were received by Defendant upon closing of the loans Plaintiff originated. Under the terms of the contract, Defendant reserved the right to modify its compensation policy and Plaintiff functioned as an at-will employee whose employment could be terminated at any time with or without cause.

Plaintiff states that he was very successful in his position, earning sizeable commissions. By the beginning of May 2013, he had transferred several loans to Defendant's underwriting and closing departments with the expectation that they would close in the second, third, or fourth quarters of 2013, which would result in more commissions to Plaintiff. Plaintiff projected he would earn commissions totaling nearly $4,000,000 for 2013. According to Plaintiff, Defendant, knowing that a seven-figure payout would result as soon as

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Plaintiff's transactions closed, decided to terminate Plaintiff on May 6, 2013 to avoid paying those commissions. Since the time of termination, many of these loans have closed, but Defendant has refused to pay commissions and deferred compensation totaling $2,098,506.

On December 13, 2013, Plaintiff filed a complaint in the Circuit Court for Montgomery County, Maryland, claiming that Defendant violated the Maryland Wage Payment and Collection Law (" MWPCL" ), Md. Code Ann., Lab. & Empl. § 3-501, breached its contract with Plaintiff, and sought a declaratory judgment that Plaintiff is entitled to commissions for work performed before Defendant terminated his employment. (ECF No. 5). On January 17, 2014, Defendant removed to this court, citing diversity jurisdiction, 28 U.S.C. § 1332. On January 24, 2014, Defendant moved to dismiss the complaint for lack of personal jurisdiction pursuant to Fed.R.Civ.P. Rule 12(b)(2) or, in the alternative, to transfer venue to the United States District Court for the District of Columbia. (ECF No. 9). Plaintiff opposed the motion on February 10, 2014 (ECF No. 13), and Defendant replied on February 27, 2014 (ECF No. 14).

II. Analysis

A. Personal Jurisdiction

When a court's power to exercise personal jurisdiction is challenged by a motion under Rule 12(b)(2), " the jurisdictional question is to be resolved by the judge, with the burden on the plaintiff ultimately to prove grounds for jurisdiction by a preponderance of the evidence." Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir. 2003) (citation omitted). If jurisdiction turns on disputed facts, the court may resolve the challenge after a separate evidentiary hearing, or may defer ruling pending receipt at trial of evidence relevant to the jurisdictional question. Combs v. Bakker, 886 F.2d 673, 676 (4th Cir. 1989). If the court chooses to rule without conducting an evidentiary hearing, relying solely on the basis of the complaint, affidavits, and discovery materials, " the plaintiff need only make a prima facie showing of personal jurisdiction." Carefirst, 334 F.3d at 396. In determining whether the plaintiff has met its burden, all jurisdictional allegations must be construed in the light most favorable to the plaintiff, and the most favorable inferences must be drawn for the existence of jurisdiction. New Wellington Fin. Corp. v. Flagship Resort Dev. Corp., 416 F.3d 290, 294 (4th Cir. 2005) (internal quotation marks omitted).

" The nature of the claim and the defendant's contacts with the forum state determine whether a court may assert specific or general personal jurisdiction." Johansson Corp. v. Bowness Constr. Co., 304 F.Supp.2d 701, 703 (D.Md. 2004). Specific personal jurisdiction applies where a controversy is " related to or 'arises out of' a defendant's contacts with the forum." Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984) ( quoting Shaffer v. Heitner, 433 U.S. 186, 204, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977)). General jurisdiction, by contrast, may be exercised where a defendant maintains " continuous and systematic" contact with the forum state. Helicopteros, 466 U.S. at 415 ( quoting Perkins v. Benguet Consol. Mining Co., 342 U.S. 437, 438, ...

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