United States District Court, D. Vermont
OPINION AND ORDER (DOC. 6)
JOHN
M. CONROY UNITED STATES MAGISTRATE JUDGE
On
August 25, 2017, Plaintiff Felipe Accioly Vieira filed the
present civil action in this Court, bringing seven counts
against Defendants Anthony Korda, Esq., and the Korda Law
Firm (the Firm). (Doc. 1 at 10-18, ¶¶ 66-111.) The
gravamen of these claims is that Korda and his law firm
failed to adequately represent and advise Vieira while he
sought, under the EB-5 Immigrant Investor Program
administered by U.S. Citizenship and Immigration Services
(USCIS), to secure permanent residency in the United States
by investing in Jay Peak in Jay, Vermont. (See
generally Doc. 1.) Based on these purported failures,
Vieira seeks total damages in excess of $2, 000, 000 and such
other relief as this Court deems proper. (Id. at 18,
¶ 9.)
Presently
before the Court is a Motion to Dismiss Case for Lack of
Jurisdiction jointly filed by Korda and the Firm pursuant to
Fed.R.Civ.P. 12(b)(2). (Doc. 6.) In their Motion, Korda and
the Firm argue that this Court lacks personal jurisdiction
because Korda “practices federal immigration law,
handled outside of Vermont, without reference to Vermont
law” and because Korda's representation of Vieira
was limited to preparing Vieira's EB-5 application.
(Id. at 3.) Vieira opposes the Motion, asserting
that all aspects of Vieira's representation involved
Vermont and that Korda benefited from an ongoing business
relationship with Jay Peak. (Doc. 17 at 1-2.)
Concluding
that Vieira's Complaint fails to plausibly allege that
Korda and the Firm had sufficient contacts with Vermont, this
Court lacks personal jurisdiction over Korda and the Firm.
Rather than dismissing the action without prejudice, however,
the Court concludes that the interests of justice warrant
transfer of this case; thus, Defendants' Motion to
Dismiss for Lack of Jurisdiction (Doc. 6) is DENIED and the
Clerk of Court shall TRANSFER this case to the United States
District Court for the Middle District of Florida.
Factual
Background
The
following background is drawn from the allegations in
Vieira's Complaint (Doc. 1), the Motion to Dismiss Case
for Lack of Jurisdiction jointly filed by Korda and the Firm
(Doc. 6), the parties' responses to this Motion (Docs.
17, 23), and the documents and affidavits accompanying the
parties' filings. (Docs. 6-1-6-3; Docs. 17-4-17-21);
see Whitaker v. Am. Telecasting, Inc., 261 F.3d 196,
208 (2d Cir. 2001) (stating that personal jurisdiction may be
established through the plaintiff's “own affidavits
and supporting materials” (internal quotation marks
omitted)). For the purposes of deciding a Rule 12(b)(2)
motion on affidavits and accompanying documents, the Court
construes the allegations in the light most favorable to
Vieira and resolves all doubts in his favor. Id.
(internal quotation marks omitted).
I.
Relevant Persons and Companies
Plaintiff
Vieira resides in Stowe, Vermont; prior to his conditional
immigration to the United States, he was a resident of
Brazil. (Doc. 1 at 1, ¶ 1; Doc. 17-12 at 4.)
Defendant
Korda is a resident of Naples, Florida, [1] and is licensed
to practice law in California. (Doc. 1 at 1, ¶¶ 2,
3; Doc. 6-1 at 1, ¶ 2.) At all relevant times, Korda was
the President of the Firm, [2] which has its principal place of
business in Naples, Florida, and an office in Beverly Hills,
California. (Doc. 1 at 1, ¶¶ 3, 4; Doc. 6-1 at 1,
¶ 1.) Korda and the Firm provide legal services related
to federal immigration law, including the EB-5 Immigrant
Investor Program, which is discussed in detail below. (Doc. 1
at 2, ¶¶ 11-12; Doc. 6-1 at 1, ¶ 3.) Neither
Korda nor the Firm advertise or solicit work in Vermont.
(Doc. 6-1 at 1, ¶ 4.)
William
Stenger is the former CEO and President of Jay Peak. (Doc. 1
at 3, ¶ 17.) In this capacity, Stenger oversaw a number
of EB-5 immigrant investor programs at Jay Peak,
(id.), including Jay Peak Hotel Suites Stateside,
L.P. (the Jay Peak Project), the project that Vieira
ultimately invested in as part of the EB-5 Immigrant Investor
Program. (Id. at 3-4, ¶ 21.)
II.
EB-5 Immigrant Investor Program
Under
the EB-5 Immigrant Investor Program, a foreign entrepreneur
who makes a capital investment in the United States can
receive a permanent U.S. visa. (Id. at 2, ¶
12.) To apply, an entrepreneur must first file a Form I-526,
entitled “Immigrant Petition by Alien Entrepreneur,
” with USCIS. (Id. at 2-3, ¶ 13); 8
C.F.R. § 204.6(a). In the I-526 Petition, the
entrepreneur must show, with supporting documentation, that
the entrepreneur has either invested capital in or is in the
process of investing capital in a new commercial enterprise
in the United States that will create at least 10 full-time
jobs for qualified workers. (Doc. 1 at 2-3, ¶¶
12-14); 8 C.F.R. § 204.6(j). In most cases, the
entrepreneur's investment is administered by a specific
regional center, which is designated by USCIS. (Doc. 1 at 2,
¶ 12); 8 C.F.R. § 204.6(j), (m)(3). If USCIS
approves the I-526 Petition, the entrepreneur and his
dependent family members are eligible for conditional
permanent residency in the United States. (Doc. 1 at 2-3,
¶ 13.)
After
two years, to gain permanent residency, the entrepreneur must
submit a Form I-829, Petition by Entrepreneur to Remove
Conditions on Permanent Resident Status. See 8
C.F.R. § 216.6; (see also Doc. 17-14.) If the
foreign entrepreneur's investment satisfies the
commercial enterprise and job-creation requirements, 8 C.F.R.
§ 216.6(c)(1)(i)-(iv), USCIS will grant the Form I-829
Petition and the immigrant investor is eligible to
permanently live and work in the United States. Id.
§ 216.6(d)(1); (Doc. 1 at 3, ¶ 15.)
III.
Vieira's Investment in the Jay Peak Project and I-526
Petition
In
February 2012, after discussions with Stenger, Vieira
preliminarily decided to invest in the Jay Peak Project as a
means of securing his U.S. immigration through the EB-5
Program. (Id. ¶ 17.) To this end, Vieira asked
Stenger to recommend attorneys familiar with the EB-5
process. (Id.) Rather than providing a list of
attorneys, in a February 24, 2012 email, Stenger recommended
Korda as a “very good [EB]-5 lawyer” who
“knows Jay Peak . . . very well.” (Doc. 17-7;
see also Doc. 1 at 3, ¶ 18.)
On the
same day-February 24, 2012-Korda emailed Vieira to offer his
services as an “Immigration Attorney focusing on EB 5
cases” who has “filed numerous I-526 petitions
for clients, many of whom . . . invested in Jay Peak
projects.”[3] (Doc. 17-8.) Four days later, on February
28, Korda followed up with Vieira, again noting that he had
“worked with Jay Peak on many successful
applications” and offering a discounted service to
Vieira because Jay Peak was “kind enough to refer
clients to [him.]” (Doc. 17-9.) Further, Korda stated
that, if Vieira decided to invest in a project other than Jay
Peak, he could “assist with due diligence” and
provide “advice about projects . . . to be wary
of.” (Id.) Finally, Korda noted that,
“[g]iven the nature of the EB-5 practice, ” most
of his clients were not located in Naples and this caused
“no logistical difficulties” with filing and
preparing documents. (Id.)
Korda's
entreaties persuaded Vieira and, on March 5, 2012, Vieira and
Korda executed a document entitled “Fee Agreement for
Legal Services” (the Agreement). (Doc. 1 at 3-4, ¶
21; see generally Doc. 6-2.) At the time Korda and
Vieira entered into the contract, Vieira was a resident of
Brazil and Korda was a resident of Florida. (Doc. 6-1 at 1,
¶ 8; Doc. 17-12 at 4.)
The
parties' Agreement provided that “[a] Client who
enters this Fee Agreement for Legal Services is certifying
and does hereby certify . . . that he or she has reached a
firm and final decision to invest in [the Jay Peak Project]
independently of any representations made by . . . the
Firm.” (Doc. 6-2 at 1.) Further, by signing the
Agreement, Vieira authorized Korda and the Firm to
communicate with Jay Peak to facilitate the preparation of
the I-526 Petition. (Id.) The Agreement also defined
the scope of Korda's services, limiting Korda's
representation to the “preparation and filing of the
I-526, Immigrant Petition by Alien Entrepreneur” and
any initial collateral applications. (Doc. 6-2 at 3.) Beyond
the preparation of the I-526 Petition, the contract specified
that “[n]o other legal services” would be
provided. (Id.) In particular, the contract
indicated that Korda's services did not include
“[m]otions to [r]e[]consider any denial of a petition
or application” or “[a]dvice upon or the filing
of an application to remove conditions of lawful permanent
residence.” (Id.) Notably, the Agreement did
not require Korda to prepare and file the second immigration
form required for Vieira to gain permanent residency under
the EB-5 program: a Form I-829, or Petition by Entrepreneur
to Remove Conditions on Permanent Resident Status.
(Id.); see also 8 C.F.R. § 216.6.
Similarly, the Agreement did not require Korda to perform a
due diligence inquiry on the Jay Peak Project, nor did the
contract require Korda to make the actual investment in the
Jay Peak Project on behalf of Vieira. Finally, the Agreement
set a flat fee for Korda's preparation of the I-526
Petition, (id. at 4-5), and indicated that the
contract would be “governed by the laws of the State of
Florida, U.S.A.” (Id. at 6.)
On
March 9, 2012, as the initial payment for Korda's
services, Vieira sent a cashier's check from the
People's United Bank branch located in Stowe, Vermont to
Korda in Florida. (Doc. 17-11; Doc. 17 at 7.) Although Vieira
still resided in Brazil at this time, Vieira had specifically
set up a bank account with People's United to make
monetary transfers to the Jay Peak Project easier. (Doc.
17-10.)
During
the same approximate time period that Vieira engaged Korda,
in late February and early March 2012, Vieira became
concerned with the allocation of investor funds for the Jay
Peak Project. (Doc. 1 at 4, ¶ 25.) In particular, on
February 28, 2012, Rapid USA Visas-a third-party EB-5
consulting company-terminated its relationship with Jay Peak
because “Rapid USA no longer [had] confidence in the
accuracy of representations made by Jay Peak . . . or in the
financial status of and disclosures made by the various
limited partnerships.” (Doc. 17-20 at 2.) When Vieira
confronted Stenger regarding Rapid USA's actions, Stenger
purportedly “downplayed the problems raised by Rapid
USA” and stated that the issues surrounding Rapid USA
were merely a “business dispute.” (Doc. 1 at 4,
¶ 26.)
Unsatisfied
with Stenger's response, (id. ¶ 27), in
early March 2012, Vieira sought advice from Korda regarding
Rapid USA and his EB-5 investment.[4] (Id. at 5, ¶
31.) On March 1, 2012, Korda emailed Vieira indicating that
the issues between Jay Peak and Rapid USA were recent and
that Jay Peak was “in the process of reorganizing their
investor liaison.” (Doc. 17-14 at 6.) Korda further
reassured Vieira that he had “emailed and ask[ed] that
someone contact[] you as soon as possible as you are anxious
to start the process.” (Id.) On March 9, 2012,
[5]
Korda sent another email stating that he had
“absolutely no information” about the
disagreement between Rapid USA and Jay Peak but he speculated
that it involved a “business fallout.” (Doc.
17-15.) Korda also wrote that he had “no inside
knowledge and so [could not] allay [Vieira's] concerns,
” but he offered to work with any regional center
project that Vieira chose. (Id.) Vieira now claims
that Korda did, in fact, have specific knowledge regarding
the issues between Rapid USA and Jay Peak. (Doc. 1 at 8,
¶¶ 51-54.)
Despite
Vieira's concerns, in roughly mid-March 2012, Jay Peak
provided Vieira with an escrow agreement and offering
documents to invest in the Jay Peak Project. (Doc. 1 at 6,
¶ 36.) Apparently, these offering documents included a
“due diligence period, ” which was set to end on
approximately June 2, 2012. (Id. ¶ 37.) Vieira
alleges that Korda “completely failed” to assist
with this due diligence process. (Id. ¶ 38.)
On or
about April 10, 2012, Korda finished preparing a draft I-526
Petition, which described Vieira's intention to invest in
the Jay Peak Project and to emigrate from Brazil once his
conditional visa was approved under the EB-5 immigrant
investor program. (Doc. 17-12 at 2, 4.) This draft petition
was not filed at that time.
Instead,
Vieira continued to seek additional financial information
from Stenger regarding the investment of EB-5 funds. (Doc. 1
at 7, ¶ 41.) Rather than provide financial information,
on May 21, 2012, a Jay Peak representative provided Vieira
with a subscription agreement, an investor questionnaire, and
instructions for wiring money to invest in the Jay Peak
Project. (Doc. 1 at 6-7, ¶¶ 40-43.) Frustrated by a
perceived lack of disclosure, Vieira instructed Korda to
draft a letter aborting his investment in the Jay Peak
Project. (Id. at 7, ¶ 44.) Rather than draft
the requested letter, Korda purportedly defended Jay Peak and
asked Vieira to meet with Stenger directly. (Id.
¶¶ 45-47.) Then, on approximately May 25, Stenger
sent Vieira a number of operational reports involving the Jay
Peak Project, although these reports did not contain the
financial information sought by Vieira. (Id. at 7-8,
¶ 48.) It is unclear whether Vieira ever received the
additional information he requested. In his Complaint,
however, Vieira alleges that he believed “his
opportunity to live the American [D]ream was about to
disappear if he did not execute the [Jay Peak Project]
subscription agreement.” (Id. at 8, ¶
49.) As a result, he signed the Jay Peak Project subscription
agreement on or about May 30, 2012. (Id. ¶ 50.)
Subsequently,
additional concerns arose. Specifically, on June 28, 2012,
Korda forwarded an email from an attorney representing Jay
Peak to Vieira, (Doc. 17-13); the email described recent
requests from USCIS seeking additional independent evidence
of the budget for the Jay Peak Project and the project's
effect on job creation. (Doc. 17-13 at 2.) Given the requests
by USCIS, Korda advised Vieira to delay filing the I-526
Petition until Jay Peak provided the evidence requested by
USCIS. (Id. at 3.) Then, on July 12, 2012, Korda
followed up with Stenger for an update because “[he
had] a number of clients anxious to file.” (Doc. 17-21
at 2.)
It is
unclear whether Jay Peak ever provided the information
requested by USCIS. It is clear, however, that around this
time, Korda submitted Vieira's I-526 Petition to the
USCIS office in California. (Doc. 6-1 at 2, ¶ 17;
see also Doc. 6-3.) Specifically, an I-797 Notice of
Action approving Vieira's I-526 Petition indicates that
the California office received Vieira's I-526 Petition on
August 23, 2012. (Doc. 6-3.) Along with approving
Vieira's I-526 Petition as of December 11, 2012, the
I-797 Notice also transferred Vieira's approved immigrant
visa petition to the Department of State National Visa Center
in Portsmouth, New Hampshire, for further processing.
(Id.).
After
Vieira's I-526 Petition was approved, Korda's
representation of Vieira ended and Vieira did not retain
Korda for any additional work. (Doc. 6-1 at 3, ¶¶
20-21.) Vieira and his family were granted conditional lawful
permanent resident status on September 24, 2013, (Doc. 17-14
at 3), and they then emigrated from Brazil to Stowe, Vermont.
(Doc. 6-1 at 3, ¶ 19; Doc. 1 at 1, ¶ 1.)
In
April 2016, the United States Securities and Exchange
Commission filed a securities fraud lawsuit against the Jay
Peak developers, including Stenger, for misappropriating EB-5
investor funds. (Doc. 1 at 9, ¶ 57.)
Subsequently,
on November 3, 2017, USCIS sent Vieira a Notice of Intent to
Deny his application for permanent residency status.
(See Doc. 17-14 at 2.) In evaluating Vieira's
I-829 Petition to Remove Conditions, which was filed on
September 16, 2015, the USCIS evaluator concluded that the
evidence Vieira submitted did not demonstrate that the Jay
Peak Project would create enough jobs to satisfy the job
creation requirement of the EB-5 program. (Id. at
5.) As a result, USCIS afforded Vieira an additional 30 days
to submit evidence demonstrating his eligibility to have the
conditions on his permanent residency status removed.
(Id.) The record does not indicate whether Vieira
complied with this request; however, Vieira asserts that he
is now facing deportation. (Doc. 17 at 15.)
Procedural
Background
On
August 25, 2017, Vieira filed the present lawsuit in this
Court. (Doc. 1.) In his Complaint, in addition to the facts
set forth above, he brings seven causes of action against
Korda and the Firm: in Count I, Vieira claims that Korda and
the Firm committed legal malpractice by “failing to
abide by Mr. Vieira's lawful instructions and requests,
” (Doc. 1 at 10, ¶ 66); in Count II, Vieira
alleges that Korda and the Firm breached the Agreement by
inadequately providing the bargained-for services,
(id. at 11, ¶¶ 69-74); in Count III,
Vieira claims that Korda and the Firm breached the duty of
good faith and fair dealing by neglecting to satisfactorily
represent Vieira under the Agreement's terms,
(id. at 11-12, ¶¶ 75-80); in Count IV,
Vieira asserts that Korda and the Firm were unjustly enriched
by receiving money for legal services that were not
performed, (id. at 12-13, ¶¶ 81-84); in
Count V, Vieira claims that Korda and the Firm violated
federal securities law, (id. at 13-15, ¶¶
85-97); in Count VI, Vieira argues that Korda and the Korda
Law Firm violated Vermont's Consumer Fraud Act, 9 V.S.A.
§§ 2451-2466b, by making false representations that
were likely to mislead Vieira, (id. at 15-16,
ΒΆΒΆ 98-104); and in Count VII, Vieira asserts that
Korda and ...