Young v. Velocity Trade CA4/3

Filed 8/12/16 Young v. Velocity Trade CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

KURT YOUNG,

Plaintiff and Appellant, G052138

v. (Super. Ct. No. 30-2014-00747226)

VELOCITY TRADE LLC et al., OPINION

Defendants and Respondents.

Appeal from orders of the Superior Court of Orange County, Frederick P.
Aguirre, Judge. Affirmed.
theDewberryfirm, Robert H. Dewberry; Phillips Lytle and Robert V.
Cornish, Jr., for Plaintiff and Appellant.
Law Offices of Richard A. Marcus and Richard A. Marcus for Defendants
and Respondents.

* * *
 Plaintiff Kurt Young appeals from the trial court’s orders granting the
motions of defendants Velocity Trade LLC (Velocity) and Advanced Markets LLC (AM)
to quash service of summons of his derivative complaint for lack of personal jurisdiction.
He contends the court erred in finding it did not have general jurisdiction over AM and
that neither AM nor Velocity had sufficient contacts to support specific jurisdiction. We
affirm the orders.
I
FACTS AND PROCEDURAL BACKGROUND
In January 2008, Melody Phan and her husband Marc Wallack incorporated
Wal Capital USA, a California Limited Liability Corporation (WC California) and
operated it from Orange County, California. Plaintiff, a resident of Sedona, Arizona, is
an individual who purchased a $50,000 membership interest in WC California.
Six months after incorporating WC California, Phan and Wallack
incorporated Wal Capital, S.A. in Costa Rica (WC Costa Rica) and listed its principal
address as being in Switzerland. Phan later contacted Velocity to open a foreign currency
exchange (Forex) trading account for WC Costa Rica.
Velocity is “a Delaware limited liability company with its principal place of
business . . . in Toronto, Ontario, Canada” and a satellite support office in New York. It
is “an introducing broker, provid[ing] introductory contacts nationwide when requested
from time to time.” In such capacity, Velocity’s sole role in this action was to introduce
WC Costa Rica to AM, which “provides dealer services for certain participants in the
Forex trading marketplace.” Velocity’s communications with Phan “were limited to:
(i) emails relating to the opening of the WC Costa Rica account; (ii) the initial funding
A[M] . . . should expect for the account; and (iii) commissions/referral fee to be paid to
Velocity for the introduction.” Velocity did not require Phan to complete any forms.
AM is a limited liability company with its principal place of business in
North Carolina. At all relevant times, AM “provided trading platform and dealer services

2
for retail and institutional traders and firms participating in trading in the area
of . . . [Forex] nationwide.” California clients comprised only a very small percentage of
AM’s total aggregate revenues and accounts.
Velocity referred WC Costa Rica to AM in December 2008. Thereafter,
AM “caused [a Forex] account to be opened for and on behalf of account for WC Costa
Rica solely for its trading operations.”
AM provided Pham with all of the necessary account documents. The
instructions for opening a corporate Forex account direct Phan to read and sign the
agreement and other necessary forms, and to send them to an address in Florida. The
document also advised that funds must be sent to the same Florida address and that
amounts over $10,000 must be wired to a bank located North Carolina.
The customer trading agreement states it is to “be governed by, and
construed in accordance with, the laws of the State of Florida without regard to the
choice-of-law provisions thereof” and that customer agrees to Florida’s jurisdiction in
any action or proceeding arising out of the agreement. Phan signed the agreement,
acknowledging AM is “a company organized under the laws of the State of Florida” and
that the agreement was between AM and WC Costa Rica. The agreement does not state
where she signed it.
On the documents, Phan identified Costa Rica as WC Costa Rica’s place of
incorporation, Switzerland as its principal place of business and origin with a banking
address there, and herself and Wallack as its authorized officers. According to plaintiff
counsel, when asked for “information for an offshore banking institution, given that
[WC] Costa Rica as an offshore entity could not have a banking presence in the United
States[,] Phan provided account information for a bank in Turkey.” WC Costa Rica’s
letterheads indicate it has addresses in Switzerland and Costa Rica.
From 2008 to 2010, AM provided a trading platform and Forex trading
dealer services to WC Costa Rica. The initial funding for WC Costa Rica occurred

3
through a wire transfer from a non-U.S. bank. AM also processed small incremental wire
transfers from WC California to WC Costa Rica as part of its services to the latter.
In September 2014, plaintiff filed a derivative complaint against Velocity
and AM for aiding and abetting a breach of fiduciary duty, conversion, and corporate
waste, as well as negligent supervision and breach of contract. Plaintiff alleged Velocity
and AM failed to conduct sufficient due diligence regarding WC Costa Rica or to
adequately supervise the account, resulting in plaintiff’s inability “to redeem his
membership interests” in WC California, the value of which “has plummeted.”
Velocity and AM filed motions to quash service of the summons and
complaint, supporting it with the declarations of their principals. Plaintiff opposed the
motion, supported by the declaration of his attorney and attached exhibits.
The trial court issued a tentative ruling granting both motions. It found it
had no general jurisdiction over AM (plaintiff made no claim of general jurisdiction over
Velocity) because “there is no evidence that AM[’s] small percentage of California
clients represents a substantial amount of business or systematic or continuous contacts
with California.” Regarding specific jurisdiction, the court determined Velocity’s
communications with Phan as the introducing broker to AM did not show purposeful
availment of California benefits and did not relate to plaintiff’s claims. As to AM, the
communications with Phan, while more than Velocity’s, were “not directed at California,
systemic or continuous, or part of a purposeful availment of the benefits of California.
The transfer activity was at the behest of a customer and not a purposeful action taken by
AM[]. And the communications were not an attempt to benefit from California, but to
service the account of WC Costa Rica by communicating with its principals.”
At the hearing on the motions, plaintiff argued Gilmore Bank v. AsiaTrust
New Zealand, Ltd. (2014) 223 Cal.App.4th 1558 (Gilmore) supported a finding of
jurisdiction over both defendants. The court ordered further briefing. It subsequently
rejected plaintiff’s claim that the communications between AM and Phan regarding the

4
wire transfers should have made AM aware “that something was not right about how
Phan and Wallack were operating WC Costa Rica – and how they were using WC
California’s money. This is [p]laintiff’s claim of liability against AM[]. But, even if
adequately evidenced, liability alone does not create jurisdiction.” The court also
distinguished Gilmore, noting “the asserted contacts by [d]efendants with California are
not close to the ‘latticework’ of contacts described [in that case].”
II
DISCUSSION

A. Pertinent Law and Standard of Review
“California has personal jurisdiction over a nonresident defendant who ‘has
such minimum contacts with the state that the assertion of jurisdiction does not violate
“‘traditional notions of fair play and substantial justice.’”’ [Citation.] The defendant’s
minimum contacts with the state must reasonably justify haling it into a California court
to conduct a defense. [Citation.] Courts apply the minimum contacts test on a case-by-
case basis, focusing on the nature and quality of the defendant’s activities in the state or
with state residents. [¶] Personal jurisdiction may be general or specific. If the
defendant’s contacts are substantial, continuous, and systematic, the defendant may be
subject to California’s general jurisdiction. [Citation.] [¶] If general jurisdiction is not
established, a nonresident defendant may still be subject to California’s specific
jurisdiction if a three-prong test is met. [Citation.] First, the defendant must have
purposefully availed itself of the state’s benefits. Second, the controversy must be
related to or arise out of the defendant’s contacts with the state. [Citation.] Third,
considering the defendant’s contacts with the state and other factors, California’s exercise
of jurisdiction over the defendant must comport with fair play and substantial justice.
[¶] The parties agree the sole issue here is whether [defendants are] subject to
California’s specific jurisdiction. Plaintiffs bear the burden of establishing that the first

5
two requirements for specific jurisdiction have been met. [Citation.] If plaintiffs do so,
the burden shifts to [defendants] to show that California’s exercise of jurisdiction would
be unreasonable.” (Gilmore, supra, 223 Cal.App.4th at pp. 1567-1568.)
“When the evidence of jurisdictional facts is not in dispute, the issue
whether the defendant is subject to personal jurisdiction is a legal question subject to de
novo review. [Citation.] When evidence of jurisdiction is in dispute, we accept the trial
court’s resolution of factual issues, draw all reasonable inferences in support of the trial
court’s order, and review the trial court’s determination of factual issues for substantial
evidence. [Citations.] ‘The ultimate question whether jurisdiction is fair and reasonable
under all of the circumstances, based on the facts which are undisputed and those
resolved by the court in favor of the prevailing party, is a legal determination warranting
our independent review.’” (Burdick v. Superior Court (2015) 233 Cal.App.4th 8, 17.)

B. General Jurisdiction over AM
Plaintiff contends the court failed to address general jurisdiction over AM.
He is mistaken. The court discussed this issue in detail in its initial tentative ruling.
Because the parties did not further argue the issue in their supplemental points and
authorities, it was sufficient for the court to merely declare AM’s contacts with California
were not “systematic or continuous” in its supplemental ruling.
Plaintiff maintains the court had jurisdiction over AM because “[t]he
relative percentage of a company’s business that is derived from a particular forum is not
dispositive.” As an example, he cites Provident Nat. Bank v. California Federal Sav. &
Loan Ass’n (3d Cir. 1987) 819 F.2d 434 (Provident). There, the defendant was a
California bank with no office and only a small number of customers in Pennsylvania.
But it maintained a “‘zero-balance’ arrangement” with a Pennsylvania bank, which
notified the defendant “every day of the total amount of checks cleared through the

6
account that day” and to which the defendant wired “transfers of funds for that
amount . . . the same day.” (Id. at p. 436.)
According to plaintiff, Provident “concluded that Pennsylvania had general
jurisdiction over the bank” “[d]espite the small percentages.” But he omits a significant
part of Provident’s analysis. In holding that general jurisdiction existed over the
California defendant in Pennsylvania, despite the small quantity of business performed in
the state, Provident cited the facts showing the contacts the California defendant had with
the forum were “daily . . . continuous and [a] central” part of the “bread and butter” of
the defendant’s business. (Provident, supra, 819 F.2d at p. 438, italics added.) Provident
also deemed the defendant to have admitted to conducting continuous business in
Pennsylvania. (Id. at p. 438.)
Here, unlike in Provident, there was no evidence AM had daily, continuous
contact with California or that contacts with California were central to AM’s business or
part of its “bread and butter.” (Cf. Provident, supra, 819 F.2d at p. 438.) Contrary to
plaintiff’s claim, the declaration of AM’s CEO, Anthony Brocco, submitted in support of
AM’s motion to quash, does not establish “AM had a substantial number of customers in
California [or that it] generated substantial revenues from those customers.” Rather, it
showed that the percentage of total annual revenue from AM’s California clients from
2008 to 2010 were, respectively, 0.02, 0.35 and 0.05 and that over its entire operating
period, California clients comprised only 2.2 percent of AM’s accounts.
The trial court did not err in concluding AM’s small percentage of
California clients was insufficient for it to exercise general jurisdiction over it.

C. Specific Jurisdiction
1. Purposeful Availment
Plaintiff contends AM and Velocity purposely availed themselves of
California benefits because they “conduct[ed] business, by telephone, mail and email,

7
with a company owned and managed from California” by California residents Phan and
Wallack. But such contacts alone are insufficient to establish that defendants
purposefully availed themselves of California’s benefits. (Edmunds v. Superior Court
(1994) 24 Cal.App.4th 221, 234 (Edmunds) [mere facts that Hawaii attorney representing
California resident in Hawaii on a Hawaii matter “came to California, made phone calls
and wrote letters to and from this state, and accepted payment from a California client, do
not establish purposeful availment of the benefits and protections of California law”];
Sher v. Johnson (9th Cir. 1990) 911 F.2d 1357 (Sher) [contacts between a California
client and the Florida law firm representing him consisting solely of telephone calls,
mailings, and three visits by a Florida lawyer to California to visit the client were not, by
themselves, sufficient connections with California to establish purposeful availment];
Sawtelle v. Farrell (1st Cir. 1995) 70 F.3d 1381, 1391, 1392 [contacts by Florida and
Virginia law firms and attorneys with New Hampshire clients “consisting primarily of
written and telephone communications with the clients in the state where they happened
to live” were insufficient by themselves to show defendants had purposely availed
themselves of New Hampshire law; “more is required”]; cf. Trinity Industries, Inc. v.
Myers & Associates, Ltd. (5th Cir.1995) 41 F.3d 229, 230-231 [Illinois law firm sued by
a Texas client had purposefully availed itself of privileges of doing business in Texas by
extended representation of the client in at least 40 matters, including a court appearance
in the forum].)
Although the above cases involve out-of-state attorneys representing
California clients on an out-of-state matter, we see no reason why their holdings should
not apply here. By communicating with Phan and Wallack via telephone, mail and e-
mail as part of their normal course of providing services to their client, WC Costa Rica,
Velocity and AM did not thereby purposely avail themselves of California’s benefits.
We do not disagree that “[c]ontact with the forum state by telephone or
mail may furnish the necessary minimum contacts essential for the exercise of

8
jurisdiction.” (Brown v. Watson (1989) 207 Cal.App.3d 1306, 1313, italics added
(Brown).) But “[o]rdinarily, the word ‘may’ connotes a discretionary or permissive act.”
(Woodbury v. Brown-Dempsey (2003) 108 Cal.App.4th 421, 433.) “In determining the
propriety of personal jurisdiction, ‘the facts of each case must be weighed to determine
whether the requisite “affiliating circumstances” are present.’” (Brown, at p. 1314.)
Cases finding specific jurisdiction based on purposeful availment generally
do so on the basis that the defendant “reached out to the [plaintiff’s] home forum”
(Newsome v. Gallacher (10th Cir. 2013) 722 F.3d 1257, 1281) in some manner in
addition to written or telephone communications with a California resident. For example,
Sher ultimately concluded the Florida law firm was subject to specific jurisdiction
because it purposefully availed itself of the benefit of California law when it took a deed
of trust on Sher’s home in order to secure payment for legal services. (Sher, supra, 911
F.2d at p. 1363.) The authorities cited by plaintiff are to the same effect.
As with the above cases, Brown, supra, 207 Cal.App.3d 1306, involved
out-of-state attorneys being sued by a resident of the forum state for legal malpractice.
Brown concluded the Texas attorney-defendants had “purposefully availed themselves of
the privilege of conducting activities in California by their decision to represent [the
plaintiffs] and their subsequent conduct.” (Id. at p. 1314.) In addition to telephonic and
written correspondence with the plaintiffs, the Texas attorneys had contacts with the
plaintiffs “personally” for a four-year period; the location of “[m]aterial and information
necessary for prosecution of the action . . . were in California,” and the defendants’ “fee
was to be paid through a fee-splitting arrangement with the California attorneys.” (Ibid.)
In Edwards v. Pulitzer Pub. (N.D.Cal. 1989) 716 F.Supp. 438, 440, a
Missouri newspaper solicited the California plaintiff by calling him to induce him to
consent to an interview in Missouri and later sending him a letter “promis[ing] to set the
record straight” following plaintiff’s claims of misrepresentations. Similarly, in West
Corp. v. Superior Court (2004) 116 Cal.App.4th 1167, a telemarketer solicited the

9
 1
California plaintiff by making an “upsell” of a separate product to a California resident
who had called to buy an advertised product. (Id. at p. 1176.) And, in Hall v. LaRonde
(1997) 56 Cal.App.4th 1342, although the plaintiff reached out and initiated contact with
the defendant in New York, the defendant “reached back to California.” “The record
shows that LaRonde’s contacts with California consisted of more than simply purchasing
a software module from Hall. LaRonde worked with Hall to integrate the module into
LaRonde’s software package. Even after the initial adaptation was finished, LaRonde
continued to work with Hall to modify the module for new and existing software. In
addition, the contract contemplated that LaRonde would make continuing royalty
payments to Hall. Thus, LaRonde created a ‘“continuing obligation[]”’ between himself
and a resident of California” sufficient to establish purposeful availment. (Id. at p. 1347.)
Gilmore also involved more than mere communications by telephone, e-
mail, and letters. (Gilmore, supra, 223 Cal.App.4th at p. 1572.) “The undisputed facts
show AsiaTrust (1) created continuing obligations between itself and California residents,
(2) purposefully directed (and continues to direct) its activities towards California
residents, and (3) purposefully derived (and continues to derive) benefits from its
activities in California. AsiaTrust conducted due diligence on California resident Sonia,
the trustee of Cindy’s Retirement Trust[, a California trust] . . . [,] sent promotional
materials to Sonia and otherwise marketed to her the advantages of forming a New
Zealand trust. AsiaTrust drafted the trust contract, negotiated the contractual terms with
California residents Sonia and Berardo [the California attorney for Sonia, and Cindy, a
California resident and the creator of Cindy’s Retirement Trust], and amended the
contract. Sonia signed the amended contract, witnessed by Berardo, in California.
AsiaTrust communicated by e-mail and telephone with Sonia and Berardo in California.

1
“An ‘up-sell’ is a ‘sales pitch for additional products or services’ made to a
customer calling to place an order.” (Dish Network Corp. v. Arch Specialty Ins. Co. (10th
Cir. 2011) 659 F.3d 1010, 1022, fn. 9.)

10
AsiaTrust has invoiced Sonia in California for fees owed to AsiaTrust. AsiaTrust has
received funds from Cindy’s Retirement Trust in California and from a Swiss annuity
that insures California resident Cindy. AsiaTrust has followed Berardo’s instructions
concerning the ownership of the Swiss annuity. AsiaTrust has wire-transferred funds to
Cindy’s Retirement Trust’s bank account in California in accordance with Sonia’s
instructions. Essentially, AsiaTrust has received compensation for accepting, investing,
managing, disbursing, and shielding the assets of Cindy, a California judgment debtor, in
a scheme that contemplates an ongoing contractual relationship for Cindy’s lifetime.”
(Ibid.)
In holding these contacts with California sufficient to meet the purposeful
availment requirement, Gilmore acknowledged, “‘While any single telephone call or
piece of correspondence might not be enough to satisfy the “minimum contacts”
requirement, there is much more in this case. Here there was a veritable “latticework” of
contacts linking [AsiaTrust] and the State of California: not one but many calls and other
communications to California during the negotiations. The execution in California of the
legal documents which formed the arrangement . . . . A continuing stream of payments
from [AsiaTrust] to California.’ [Citation.] A continuing receipt by AsiaTrust of
compensation from the California trustee of a California trust. AsiaTrust’s acceptance
from the California trust of money which AsiaTrust invested as directed by the California
trustee and a California lawyer.” (Gilmore, supra, 223 Cal.App.4th at p. 1573.)

a. Velocity
Plaintiff contends Velocity’s contacts are similar to those in Gilmore in that
Velocity: (1) communicated with Phan and Wallack by telephone, e-mail and mail about
the opening of the WC Costa Rica account and its initial funding while they managed the
account from Orange County, California; (2) “performed due diligence on Phan and
[WC] Costa Rica”; (3) received “documentation [prepared and sent from California by

11
Phan and Wallack] relating to [WC] Costa Rica, its financial condition and
creditworthiness, and Phan’s and Wallack’s business character and investment
experience”; and (4) collected “compensation, in the form of fees, for the introductory
services it provided to Phan, Wallack, and [WC] Costa Rica.” The asserted similarities
either do not exist or do not demonstrate purposeful availment on the part of Velocity.
Unlike in Gilmore, Velocity’s communications with Phan and Wallack
were for “a one-time transaction” limited to helping them set up a Forex account by
introducing them and WC Costa Rica to AM. Plaintiff has made no showing that
Velocity reached back to California or benefited from California in any manner, whether
from its communications, due diligence, or receipt of documents or fees.
By contrast, the due diligence performed in Gilmore and receipt of
documentation were just two of many factors the court considered in what was supposed
[2]
to “an ongoing contractual relationship for Cindy’s lifetime” from which AsiaTrust
received substantial compensation. (Gilmore, supra, 223 Cal.App.4th at p. 1572.) Here,
Velocity’s part in the matter ended once it introduced Phan and WC Costa Rica to AM
and it received no fees from California. In his declaration in support of Velocity’s
motion to quash, Simon Law, a member and director of Velocity, attested that the only
thing Velocity did for WC Costa Rica was to introduce it to AM. For that, Velocity
“receive[d] commissions from [AM],” a non-California entity. Neither of the WC entities
paid any money directly to Velocity. Additionally, Velocity generally “was not privy to
any communications or information relating to banking relationships and/or transactions
by any of the [WC] entities.” Plaintiff presented no contrary evidence and has not
established Velocity purposefully availed itself of California’s benefits. The trial court
correctly granted Velocity’s motion to quash.

2
Cindy is the beneficiary of the trust for which the defendant, AsiaTrust, agreed to
serve as the trustee. (Gilmore, supra, 223 Cal.App.4th at p. 1564.)

12
 b. AM
Plaintiff argues AM’s contacts with California are analogous to those in
Gilmore because AM: “provided its trading platform and dealer services to Phan,
Wallack, W[C] Costa Rica, and, eventually, [WC California;] . . . communicated with
Phan by email, mail, and telephone to Orange County, California[;] . . . performed due
diligence and required Phan and W[C] Costa Rica to complete forms it provided[;] . . .
accepted wired funds from [WC California into] W[C] Costa Rica’s [forex
account;] . . . applied, through [its] trading platform, the investment directions on behalf
of W[C] Costa Rica, all of which originated in California[; and] received compensation
from Phan and W[C] Costa Rica for the services it provided.” We are unpersuaded.
As with Velocity, AM’s communications, performance of due diligence,
acceptance of wire transfers from California, and application of Phan’s investment
instructions all related to AM’s provision of services to its client, WC Costa Rica. But in
Gilmore, AsiaTrust did more than service the account of its client. It solicited business
from California by sending Sonia promotional materials, marketed to her the advantages
of forming a trust in its jurisdiction, negotiated the contract that was signed in California
by Sonia, a California resident, with another California resident, Berardo, who also
witnessed the contract being signed in California. AsiaTrust then invoiced Sonia for
thousands of dollars in fees. It also wire transferred funds from a Swiss annuity to the
retirement fund to a bank account in California. (Gilmore, supra, 223 Cal.App.4th at pp.
1565-1567, 1572.)
These additional facts differentiate this case from Gilmore. According to
Brocco’s declaration in support of AM’s motion to quash, AM “did not solicit or
otherwise make the initial contact with WC Costa Rica” but was introduced to it by
Velocity. Although AM knew of WC California’s existence and that its principals were
physically located in California, it had no contractual or other relationship with them or
their affiliates. Its contract was solely “with WC Costa Rica to provide services as a

13
dealer with respect to it and its offshore [Forex] trading operations and not to conduct any
business in . . . California.” Plaintiff does not claim AM sent promotional materials to
Phan or Wallack.
The instructions for AM’s contract with WC Costa Rica directed Phan to
send all necessary documents to an address in Florida. Under the instructions, Phan was
advised that funds must be sent to the same Florida address and that amounts over
$10,000 must be wired to a bank located North Carolina.
The record does not reflect where Phan signed the contract. But in signing
it, she agreed the contract was to be “governed by, and construed in accordance with, the
laws of the State of Florida,” consented to Florida’s jurisdiction in any matter arising out
of the contract and acknowledged AM is “a company organized under the laws of the
State of Florida.”
Unlike in Gilmore, where AsiaTrust wire transferred funds into a
California bank account (Gilmore, supra, 223 Cal.App.4th at pp. 1565-1567, 1572),
plaintiff’s claim here is that AM accepted the funds that were wired from WC California
into WC Costa Rica’s offshore Forex account, presumably located in Turkey based on
plaintiff’s counsel’s declaration, not that AM itself transferred the funds. Plaintiff does
not explain how merely allowing WC California to transfer the funds to an offshore
account makes this case analogous to Gilmore.
Plaintiff maintains “AM reap[ed] obvious benefits as a result of servicing
its client’s account[], because it is compensated for doing so.” But no evidence shows
who compensated AM or from where. Plaintiff failed to provide any record citation to
support his contention that AM was paid by Phan and WC Costa Rica. As such, we
“‘“may treat it as waived.”’” (Lonely Maiden Productions, LLC v. GoldenTree Asset
Management, LP (2011) 201 Cal.App.4th 368, 384 [claim of error forfeited by failure to
provide appropriate citations to the record].)

14
 Even if the argument was not waived, the record does not allow this court
to determine where AM was compensated from. AM could have been compensated from
Phan and Wallack in California, the Swedish bank identified on the corporate documents
filled out by Phan for WC Costa Rica, the Turkish bank mentioned in plaintiff’s counsel’s
declaration, or the “non-U.S. banking institution” referenced in the declaration of AM’s
counsel. Making it even more uncertain are two letters sent by Phan to AM written on
two different WC Costa Rica business letterheads each with a different address: one in
Costa Rica and the other in Sweden. Without verification by Phan or AM, or a
postmarked envelope, it cannot be determined where the letters originated.
We also reject plaintiff’s claim that AM purposefully derived economic
benefits from California “in the form of commissions/fees, by conducting business with
W[C California.]” In Brocco’s declaration, he attested that AM “did not maintain any
business relationship with WC California.” Although AM knew of its existence and “that
WC Costa Rica had principals who were physically located in . . . California,” it “only
contracted . . . with WC Costa Rica to provide services as a dealer with respect to it and
its offshore trading operations and not to conduct any business in the State of California.
[AM] did not seek to, and did not, maintain any relationship contractual or otherwise with
WC California or any affiliates thereof besides WC Costa Rica.”
And even if AM received a financial benefit from California in the form of
compensation by Phan, “[a]ny promotion of [its] California financial interests was
incidental. Everything [it did] was done in [its] capacity as a [Forex trading platform and
dealer service provider], and [it] thus lacks the necessary close relationship to the State of
California in these matters to justify the assertion of personal jurisdiction over [it].”
(Edmunds, supra, 24 Cal.App.4th at p. 236.)
Unlike in Gilmore, plaintiff here has not provided sufficient competent
evidence to show the “‘“latticework” of contacts’” linking AM to California or that AM’s
“‘forum activities should [have] put [it] on notice that [it] will be subject to litigation in

15
the forum.’” (Gilmore, supra, 223 Cal.App.4th at p. 1573.) No error occurred in the
granting of AM’s motion to quash service.

2. Remaining Requirements for Specific Jurisdiction
Because plaintiff has not carried his burden of establishing Velocity and
AM purposefully availed themselves of California’s benefits, we need not address the
remaining requirements for specific jurisdiction.
III
DISPOSITION
The orders are affirmed. Respondents shall recover their costs on appeal.

MOORE, J.

WE CONCUR:

BEDSWORTH, ACTING P. J.

ARONSON, J.

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