[Cite as Holcomb v. Naples, 2014-Ohio-3287.]
COURT OF APPEALS
STARK COUNTY, OHIO
FIFTH APPELLATE DISTRICT
JUDY HOLCOMB, ET AL. JUDGES:
Hon. William B. Hoffman, P.J.
Plaintiffs-Appellees Hon. W. Scott Gwin, J.
Hon. John W. Wise, J.
-vs-
Case No. 2013CA00214
ANTHONY L. NAPLES
Defendant-Appellant OPINION
CHARACTER OF PROCEEDING: Appeal from the Stark County Court of
Common Pleas, Case No. 2011CV02063
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: July 21, 2014
APPEARANCES:
For Plaintiffs-Appellees For Defendant-Appellant
ANTHONY E. BROWN RANDOLPH L. SNOW
Baker, Dublikar, Beck, Black, McCuskey, Souers & Arbaugh
Wiley & Mathews 220 Market Avenue, Suite 1000
400 South Main Street Canton, Ohio 44702
North Canton, Ohio 44720
Stark County, Case No. 2013CA00214 2
Hoffman, P.J.
{¶1} Defendant-appellant Anthony L. Naples appeals the February 23, 2012
Judgment Entry entered by the Stark County Court of Common Pleas, which denied his
motion to dismiss for lack of personal jurisdiction. Plaintiffs-appellees are Judy Olszeski
Holcomb, Joan Olszeski, and Jane Olszeski Tortola.
STATEMENT OF THE FACTS AND CASE
{¶2} In 2006, Appellees, who are Ohio residents, sold their interests in Olszeski
Properties, Inc. to James Wilson. James Wilson is the primary shareholder of two Ohio
businesses, to wit: O.P. Ohio Corporation (“O.P. Ohio”) and H.G. Ohio Corporation
(“H.G. Ohio”). James Wilson, on behalf of O.P. Ohio, executed a promissory note in the
amount of $3.53 million payable to Appellees. The Note was guaranteed by H.G. Ohio
and James Wilson personally.
{¶3} In 2009, James Wilson filed bankruptcy on behalf of both O.P. Ohio and
H.G. Ohio. Following the bankruptcy filing and, as the result of litigation in the Stark
County Court of Common Pleas, Appellees received the business/financial records of
both businesses. These records omitted any reference to the Note and obligation owed
to Appellees. Upon further review of the records, Appllees identified numerous
transactions which they believed to be fraudulent conveyances. The challenged
transactions were transactions in which money was paid by O.P. Ohio and H.G. Ohio
for the benefit of Appellant; Richard Lamb; and Priscilla Wilson, James Wilson’s wife.
Testimony at trial revealed no business purpose in the financial records to support the
businesses making these payments.
Stark County, Case No. 2013CA00214 3
{¶4} Appellant, who is a Florida resident, was an investor in a limited liability
company called 3770 Broad Company, LLC. (“Broad Co.”) Appellant was also a one-
third owner and member of Broad Co. James Wilson and Richard Lamb also were one-
third owners of Broad Co. In 2004, Broad Co. applied for a loan with Investors Capital
Corporation in the amount of $1,275,000.00, to purchase real property located at 3770
W. Broad St., Columbus, OH. The loan was approved, and Broad Co. executed a
mortgage agreement and promissory note on or about October 25, 2004. James
Wilson, Richard Lamb, and Appellant executed a guarantee as members of Broad Co.,
guaranteeing the payment of the promissory note. Payments in the amount of
$97,715.75 were made on the promissory note by H.G. Ohio and O.P. Ohio when those
businesses were insolvent in 2008, and 2009.
{¶5} In 2010, Appellees obtained a judgment in bankruptcy court against O.P.
Ohio, H.G. Ohio, and James Wilson personally in the amount of $3.53 million dollars.
On July 6, 20011, Appellees filed a complaint for money damages and other relief,
alleging Appellant was one of the recipients of the fraudulent transfers from O.P. Ohio
Corporation and H.G. Ohio Corporation. Richard Lamb and Priscilla Wilson were also
named as defendants, but are not parties to this Appeal.
{¶6} On August 25, 2011, Appellant filed a motion to dismiss for lack of
personal jurisdiction. Via Judgment Entry filed February 23, 2012, the trial court denied
the motion. The trial court found Appellant transacted business in Ohio as he was a
partner in an Ohio partnership formed to purchase and hold Ohio real estate, and had
personally guaranteed a mortgage in Columbus, Ohio. The trial court further found
Stark County, Case No. 2013CA00214 4
Appellant, as recipient/beneficiary of the fraudulent transfers from H.G. Ohio and O.P.
Ohio, caused tortuous injury to Appellees in Ohio.
{¶7} The matter proceeded to non-jury trial on March 19, 2013. The trial court
granted judgment in favor of Appellees, and against Appellant, in the amount of
$97,715.75.
{¶8} It is from the February 23, 2012 Judgment Entry Appellant appeals, raising
the following as error:
{¶9} "I. THE TRIAL COURT ERRED IN ITS OVERRULING OF DEFENDANT
ANTHONY L. NAPLES' MOTION TO DISMISS FOR LACK OF PERSONAL
JURISDICTION."
I
{¶10} Appellant asserts Appellees failed to demonstrate, and the trial court failed
to find, that the cause of action at issue arose from actions by Appellant within the
parameters of personal jurisdiction as set forth in either R.C. 2307.382 or Civ. R. 4.3(A).
{¶11} In determining whether it has personal jurisdiction over an out-of-state
defendant, a court must engage in a two-step inquiry: first, the court must determine
whether the defendant's conduct falls within Ohio's “long-arm” statute or the applicable
civil rule, and if it does, then the court must determine whether the assertion of
jurisdiction over the nonresident defendant would deprive the defendant of due process
under the Fourteenth Amendment to the United States Constitution. Goldstein v.
Christiansen, 70 Ohio St.3d 232, 235 (1994).
{¶12} Ohio's long-arm statute in R.C. 2307.382 states, in pertinent part:
Stark County, Case No. 2013CA00214 5
(A) A court may exercise personal jurisdiction over a person who
acts directly or by an agent, as to a cause of action arising from the
person's:
(1) Transacting any business in this state;
(2) Contracting to supply services or goods in this state;
(3) Causing tortious injury by an act or omission in this state;
(4) Causing tortious injury in this state by an act or omission outside
this state if he regularly does or solicits business, or engages in any other
persistent course of conduct, or derives substantial revenue from goods
used or consumed or services rendered in this state;
***
(7) Causing tortious injury to any person by a criminal act, any
element of which takes place in this state, which he commits or in the
commission of which he is guilty of complicity.
(8) Having an interest in, using, or possessing real property in this
state[.]
{¶13} R.C. 2307.381 provides, for purposes of R.C. 2307.382, “person” includes
“an individual, his executor, administrator, or other personal representative, or a
corporation, partnership, association, or any other legal or commercial entity, who is a
nonresident of this state.”
{¶14} Civ.R. 4.3 governs when service of process may be made outside this
state. The language in Civ.R. 4.3(A)(1)-(4) is similar to the language in R.C.
Stark County, Case No. 2013CA00214 6
2307.382(A)(1)-(4), and the language in Civ.R. 4.3(A)(10) is similar to the language in
R.C. 2307.382(A)(7).
{¶15} The plaintiff has the burden of proving personal jurisdiction once it has
been challenged. Goldstein, 70 Ohio St .3d at 235. When, as here, the trial court does
not hold an evidentiary hearing on a Civ.R. 12(B)(2) motion to dismiss for lack of
personal jurisdiction, the plaintiff need make only a prima facie showing of personal
jurisdiction to withstand a motion to dismiss for lack of personal jurisdiction. Id. at 236.
In determining whether the plaintiff has established the requisite prima facie showing,
the trial court must view allegations in the pleadings and the documentary evidence in
the record in the light most favorable to the plaintiff, resolving all reasonable competing
inferences in the plaintiff's favor. Id.
{¶16} Since personal jurisdiction is a question of law, the court of appeals'
standard of review is de novo. State ex rel. Atty. Gen. v. Grand Tobacco, 171 Ohio
App.3d 551, 2007–Ohio–418 (10th Dist. Franklin 2007).
{¶17} In its February 23, 2012 Judgment Entry, the trial court specifically found:
* * * the Ohio Long Arm Statute and Ohio Civil Rule 4.3 confer
jurisdiction over [Appellant] in that [Appellant] transacted business in the
State of Ohio. * * * [Appellant] transacted business in Ohio as he is a
partner in an Ohio partnership formed to purchase and hold Ohio real
estate and has personally guaranteed a mortgage in Columbus, Ohio.
Further, the allegation in [Appellees’] Complaint clearly state that they
were caused tortuous injury in Ohio because [Appellant is a
recipient/beneficiary] of fraudulent transfers from the Ohio business debtor
Stark County, Case No. 2013CA00214 7
corporations. Therefore, the allegations in the complaint confer
jurisdiction over [Appellant].
{¶18} We agree with the trial court and find Appellant transacted business in
Ohio and caused tortuous injury in the state. Appellant was the recipient and
beneficiary of multiple fraudulent transfers from an Ohio business. The transfers were
used to pay on a loan secured by a mortgage on real property located in Ohio, which
Appellant had personally guaranteed. Further, Appellant caused tortuous injury in Ohio
and the cause of action Appellees brought against him arose from that injury.
{¶19} Additionally, Appellant argues, even if Ohio’s long arm statute confers
jurisdiction over him, the trial court erred in denying his motion to dismiss as Appellees
failed to demonstrate that jurisdiction over him did not violate his right to due process.
{¶20} The Due Process Clause of the Fourteenth Amendment mandates that a
court exercise jurisdiction only if the defendant has sufficient minimum contacts with the
state such that summoning the party to Ohio would not offend the “ ‘traditional notions of
fair play and substantial justice.' " Internatl. Shoe Co. v. Washington, 326 U.S. 310,
316, 66 S.Ct. 154, 90 L.Ed. 95 (1945). In determining whether a defendant has the
necessary minimum contacts with the forum, a court should consider “ ‘the number of
contacts, the nature and quality of the contacts, the source and connection between the
cause of action and the contacts, the interest of the forum state [,] and the convenience
of the parties.' " Natl. City Bank v. Yevu, 178 Ohio App.3d 382, 2008–Ohio–4715, 898
N.E.2d 52, ¶ 16 (8th Dist.), quoting M & W Contrs., Inc. v. Arch Mineral Corp. 335
F.Supp. 972 (S.D.Ohio 1971). The constitutional touchstone is whether the nonresident
defendant purposely established contacts in the forum state such that the defendant
Stark County, Case No. 2013CA00214 8
should reasonably anticipate being hauled into court in that state. Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 474, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985), citing World–
Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490
(1980).
{¶21} We find Appellant purposefully availed himself of the privilege of
conducting business and engaging in activities in Ohio. Appellant is a member of an
Ohio LLC, which holds mortgaged property located in Ohio. Further, Appellant
personally guaranteed payment of the mortgage on this Ohio property.
{¶22} Appellant makes much ado over the trial court’s finding he “transacted
business in Ohio as he is a partner in an Ohio partnership formed to purchase and hold
Ohio real estate”. Appellant asserts the finding was erroneous as Appellees did not
bring their claims against an Ohio partnership, but rather against Appellant individually.
Appellant explains he is not personally liable for actions taken by Broad Co., which is a
limited liability company, not a partnership as the trial court indicated, and his
membership in the LLC does not extend liability to him. Although we find the trial court
incorrectly characterized Broad Co. as a partnership, we find this misnomer does not
render the trial court’s underlying rationale invalid, particularly in light of Appellant's
personal guarantee on the note.
{¶23} Upon review of the pleadings, we find Appellees made the prima facie
showing of jurisdiction over Appellant. R.C. 2307.382 and Civ.R. 4.3 confer personal
jurisdiction over Appellant and the assertion of personal jurisdiction over Appellant
comports with the Due Process Clause of the Fourteenth Amendment. It cannot be said
Stark County, Case No. 2013CA00214 9
from the face of the complaint that Appellant did not purposely establish contacts in
Ohio such that he would not reasonably anticipate being hauled into an Ohio court.
{¶24} Appellant’s sole assignment of error is overruled.
{¶25} The judgment of the Stark County Court of Common Pleas is affirmed.
By: Hoffman, P.J.
Gwin, J. and
Wise, J. concur