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Rilley v. Moneymutual, LLC

United States District Court, D. Minnesota

December 11, 2017

Scott Rilley, Michelle Kunza, Linda Gonzales and Michael Gonzales, individually and on behalf of the putative class, Plaintiffs,
v.
MoneyMutual, LLC, Selling Source, LLC, and PartnerWeekly, LLC, Defendants.

          E. Michelle Drake, Esq., Jeffrey Laurence Osterwise, Esq., and John G. Albanese, Esq., Berger & Montague, PC, and Mark L. Heaney, Esq., Heaney Law Firm, LLC.

          Christina Rieck Loukas, Esq., and Joseph M. Windler, Esq., Winthrop & Weinstine, PA, Donald J. Putterman, Esq., Michelle L. Landry, Esq., and Tobias G. Snyder, Esq., Putterman Landry & Yu LLP, counsel for Defendants.

          MEMORANDUM OPINION AND ORDER

          DONOVAN W. FRANK UNITED STATES DISTRICT JUDGE

         INTRODUCTION

         The plaintiffs in this case filed a purported class action against the defendants for their role in generating sales leads in Minnesota for payday lenders. The defendants moved to dismiss for lack of personal jurisdiction, and the Court denied that motion. One of the defendants now moves the Court to certify the issue for interlocutory appeal. For the reasons discussed below, the Court denies the defendant's motion.

         BACKGROUND

         The Court assumes the reader's familiarity with the facts of the case, which are more fully set out in the Court's August 30, 2017 Memorandum Opinion and Order (Doc. No. 62). In short, Defendants collectively operate a lead-generating business for various payday lenders. Consumers would go to the Defendants' website to fill out an application, and then Defendants would sell the application to lenders. The lenders would independently decide whether to lend consumers money.

         Defendant MoneyMutual, LLC maintained the website and advertised nationally on television and the Internet, but had no employees or officers. Defendant PartnerWeekly, LLC was MoneyMutual's managing agent. PartnerWeekly would purchase the advertising, operate the website, and contract with lenders on behalf of MoneyMutual. Defendant Selling Source, LLC is the sole parent of MoneyMutual and PartnerWeekly. Selling Source provided common services to the subsidiaries (like legal and accounting), but did not operate the day-to-day business.

         Plaintiffs are consumer-borrowers and have filed a purported class action against Defendants related to the payday loans. Plaintiffs first filed their complaint in Minnesota state court, naming only MoneyMutual as a defendant. MoneyMutual moved to dismiss for lack of personal jurisdiction. In Rilley v. MoneyMutual, LLC (Rilley I), the Minnesota Supreme Court affirmed the finding of personal jurisdiction. 884 N.W.2d 321 (Minn. 2016). After the United States Supreme Court denied MoneyMutual's petition for certiorari, 137 S.Ct. 1331, Plaintiffs amended the complaint to add Defendants PartnerWeekly and Selling Source and to add a claim for violating 18 U.S.C. § 1962(c) of the federal Racketeer Influenced and Corrupt Organizations (RICO) Act. Defendants then removed the case to federal court. (Doc. No. 1.)

         At issue here, the Court concluded that it had personal jurisdiction over Defendants based on the nationwide service of process allowed for under the RICO Act. The Court noted that without the RICO Act, the Court would have dismissed Selling Source, but would have stayed the dismissal pending jurisdictional discovery. (Doc. No. 62 at 7 n.3.) The Court then dismissed the RICO claim for failure to state a claim. In dismissing the claim, the Court acknowledged the incongruity between using the RICO claim to exercise jurisdiction and then dismissing the claim as insufficiently pleaded. Ultimately, the Court concluded that Plaintiffs satisfied the lower standard (a colorable claim) needed for jurisdiction. Selling Source now moves the Court to certify for interlocutory appeal the following question:

Can a federal court assert personal jurisdiction over a defendant pursuant to the RICO Act, 18 U.S.C. § 1962(c), despite simultaneously dismissing the RICO Act claim against the defendant with prejudice under Rule 12(b)(6)?

         DISCUSSION

         I. Legal Standard

         Courts of appeals have jurisdiction over “all final decisions of the district courts.” 28 U.S.C. § 1291. A district court may designate an otherwise non-final order as certified for interlocutory appeal under ...


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