Beachley v. Palisades Funding, Corp. et al

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Nina Y. Wang
Civil Action No. 23-cv-03098-NYW-KAS
MARK C. BEACHLEY,
Plaintiff,
v.
PALISADES FUNDING, CORP., and
TRANS UNION, LLC,
Defendants.
ORDER
This matter comes before the Court on Defendant’s Motion to Dismiss (“Motion to
Dismiss”), [Doc. 16, filed December 22, 2023], filed by Defendant Palisades Funding,
Corp. (“Palisades” or “Defendant”).1 The Motion to Dismiss is opposed by Plaintiff Mark
C. Beachley (“Plaintiff” or “Mr. Beachley”). 	The Court finds that oral argument will not
materially assist in the disposition of the Motion to Dismiss. Upon review of the Parties’
briefing, the entire docket, and the applicable case law, this Court respectfully GRANTS
the Motion to Dismiss.
1 Defendant filed a separate Brief in Support of Its Motion to Dismiss. 	[Doc. 17]. 	This
District’s Local Rules contemplate that all argument and authority that supports a motion
will be included in the motion itself, rather than in a separate brief. 	D.C.COLO.LCivR
7.1(d). In addition, Plaintiff’s Response is single-spaced, in violation of D.C.COLO.LCivR
10.1(e). 	For purposes of efficiency, this Court considers these materials instead of
striking them for non-compliance. Fed. R. Civ. P. 1; King v. Rosek Co., No. 11-cv-01685-
CMA-MJW, 2012 WL 13013456, at *1 (D. Colo. Nov. 27, 2012) (observing that a district
court has discretion to strike materials that are not compliant with the Local Rules).
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BACKGROUND
The following allegations from the Complaint and Demand for Jury (“Complaint”),
[Doc. 7-3], are taken as true for the purposes of this Order.2 	Mr. Beachley lives in
Colorado and works in the finance industry. [Id. at ¶¶ 2, 14]. In 2021, he encountered an
online advertisement for a 2015 Lexus RCF and decided to buy the vehicle from nonparty
26 Motors, the advertiser and seller. [Id. at ¶ 15]. The posted price was $39,950. [Id.].
Plaintiff put $35,000 down and sought to finance the remaining $4,950. [Id. at ¶¶ 16–17].
The vehicle was financed through Palisades. [Id. at ¶ 17].
26 Motors, acting as Palisades’s agent, presented Plaintiff with loan documents on
November 15, 2021. 	[Id.]. 	26 Motors and Palisades have “common ownership and
employees.” 	[Id. at ¶ 11]. 	Although the difference between the purchase price and the
amount Mr. Beachley had put down was only $4,950, the documents supplied by 26
Motors contemplated a $62,000 loan. [Id. at ¶ 17]. Plaintiff, unaware of this discrepancy,
signed the documents and began making monthly payments. 	[Id. at ¶¶ 18–19]. 	Upon
“inspecting the loan documents in detail,” however, Plaintiff noticed that the loan amount
had been “inflated.” [Id. at ¶ 20].
Palisades then advised several credit reporting agencies that Plaintiff defaulted on
the vehicle loan. [Id. at ¶ 21]. Unable to resolve the issue, Plaintiff sued 26 Motors in the
United States District Court for the Southern District of New York. [Id. at ¶ 22]. Through
that litigation, Plaintiff allegedly “discovered Palisades’ role in the fraud.” [Id. at ¶ 23]. On
November 30, 2022, Plaintiff, 26 Motors, and Palisades entered into an agreement to
2 The Court discusses additional factual material submitted in connection with the Parties’
jurisdictional briefing throughout the analysis below.
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resolve the New York litigation (the “Settlement Agreement”), pursuant to which Palisades
would “remove all entries pertaining to Beachley and this car loan” from several credit
bureaus. [Id. at ¶¶ 24–25].
Mr. Beachley filed this action in Colorado state court on October 5, 2023. 	[Id. at
8]. In the Complaint, he alleges that Palisades has failed to comply with the Settlement
Agreement by declining to correct erroneously reported credit information and even
confirming inaccurate information when contacted by fellow Defendant Trans Union, LLC
(“Trans Union”). 	[Id. at ¶¶ 26–27]. 	Plaintiff alleges that his Trans Union credit reports
have “continued to show derogatory accounts related to the fraudulent loan” which Trans
Union refuses to correct. [Id. at ¶¶ 29–30]. Seeking damages, Plaintiff brings one claim
against Trans Union under the Colorado Consumer Credit Reporting Act and one claim
against Palisades for common law fraud. [Id. at ¶¶ 31–42]. The fraud claim alleges that
the “[s]tatement[] contained in the Settlement Agreement that Palisades would cooperate
with the correct reporting of the loan to the various credit reporting agencies was a
material representation,” which Plaintiff “reasonably and justifiably relied upon” to his
detriment. See [id. at ¶¶ 38–42].
On November 21, 2023, before Palisades entered an appearance in state court,
Trans Union removed this case to federal court, invoking diversity jurisdiction under 28
U.S.C. § 1332. 	[Doc. 1 at ¶¶ 4, 13]. 	Palisades subsequently moved to dismiss. 	[Doc.
16; Doc. 17]. The motion is fully briefed, [Doc. 28; Doc. 39], and ripe for decision.
LEGAL STANDARD
Rule 12(b)(2) of the Federal Rules of Civil Procedure allows a defendant to
challenge the court’s exercise of personal jurisdiction. 	Fed. R. Civ. P. 12(b)(2).
“[P]laintiffs bear the burden of establishing personal jurisdiction.” 	Dudnikov v. Chalk &
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Vermilion Fine Arts, Inc., 514 F.3d 1063, 1069 (10th Cir. 2008). When, as here, a court
decides a Rule 12(b)(2) motion to dismiss without holding an evidentiary hearing, “the
plaintiff need only make a prima facie showing of personal jurisdiction to defeat the
motion.” AST Sports Sci., Inc. v. CLF Distrib. Ltd., 514 F.3d 1054, 1057 (10th Cir. 2008);
see also id. at 1056 (“[I]n the preliminary stages of litigation, the plaintiff’s burden is light.”).
“The plaintiff may make this prima facie showing by demonstrating, via affidavit or other
written materials, facts that if true would support jurisdiction over the defendant.” 	OMI
Holdings, Inc. v. Royal Ins. Co. of Can., 149 F.3d 1086, 1091 (10th Cir. 1998). 	In
considering this question, a court must accept all well-pleaded facts as true and resolve
any factual disputes in favor of the plaintiff. See Wenz v. Memery Crystal, 55 F.3d 1503,
1505 (10th Cir. 1995); see also Wise v. Lindamood, 89 F. Supp. 2d 1187, 1189 (D. Colo.
1999) (noting that the Court “must resolve all disputed facts and draw all reasonable
inferences in the plaintiff’s favor”).
ANALYSIS
The Motion to Dismiss contends that the Court lacks personal jurisdiction over
Palisades under Rule 12(b)(2) and that, in the event the Court has jurisdiction, the
Complaint fails to state a claim for fraud under Rule 12(b)(6). 	The Court finds that it
cannot exercise personal jurisdiction over Palisades under Rule 12(b)(2). 	Accordingly,
the Court does not reach the Rule 12(b)(6) argument.
I. 	Personal Jurisdiction, Generally
“The requirement that a court have personal jurisdiction flows from the Due
Process Clause. 	It represents a restriction on judicial power not as a matter of
sovereignty, but as a matter of individual liberty.” 	Peay v. BellSouth Med. Assistance
Plan, 205 F.3d 1206, 1210 (10th Cir. 2000) (cleaned up). “To obtain personal jurisdiction
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over a nonresident defendant in a diversity action, a plaintiff must show that jurisdiction
is legitimate under the laws of the forum state and that the exercise of jurisdiction does
not offend the due process clause of the Fourteenth Amendment.” 	Far W. Cap., Inc. v.
Towne, 46 F.3d 1071, 1074 (10th Cir. 1995) (emphasis omitted). However, “Colorado’s
long-arm statute, Colo. Rev. Stat. § 13-1-124, extends jurisdiction to the [United States]
Constitution’s full extent. 	The personal jurisdiction analysis here is thus a single due
process inquiry.” 	Old Republic Ins. Co. v. Cont’l Motors, Inc., 877 F.3d 895, 903 (10th
Cir. 2017) (citations omitted).
“To exercise jurisdiction in harmony with due process, defendants must have
minimum contacts with the forum state, such that having to defend a lawsuit there would
not offend traditional notions of fair play and substantial justice.” 	Shrader v. Biddinger,
633 F.3d 1235, 1239 (10th Cir. 2011) (quotation and alteration omitted); see also Int’l
Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). 	A defendant’s contacts may give
rise to general or specific personal jurisdiction. 	See Intercon, Inc. v. Bell Atl. Internet
Sols., Inc., 205 F.3d 1244, 1247 (10th Cir. 2000). 	General jurisdiction arises when a
defendant’s contacts with the forum state are so continuous and systematic as to
essentially render it “at home” in that state. See Daimler AG v. Bauman, 571 U.S. 117,
139 (2014). 	Specific jurisdiction is particular to the instant action and arises where a
defendant purposefully directs its activities to residents of the forum, and the cause of
action arises out of those activities. See Melea, Ltd. v. Jawer SA, 511 F.3d 1060, 1066
(10th Cir. 2007).
“Specific jurisdiction . . . is premised on something of a quid pro quo: in exchange
for ‘benefitting’ from some purposive conduct directed at the forum state, a party is
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deemed to consent to the exercise of jurisdiction for claims related to those contacts.”
Dudnikov, 514 F.3d at 1078. The analysis turns on a host of nondispositive factors. For
example, a nonresident’s contract with a forum resident is insufficient, by itself, to
establish jurisdiction. 	Burger King Corp. v. Rudzewicz, 471 U.S. 462, 478 (1985).
Relatedly, “‘[f]oreseeability’ alone has never been a sufficient benchmark for personal
jurisdiction under the Due Process Clause.” World-Wide Volkswagen Corp. v. Woodson,
444 U.S. 286, 295 (1980). And “[s]o long as a commercial actor’s efforts are ‘purposefully
directed’ toward residents of another State,” the Supreme Court has “consistently rejected
the notion that an absence of physical contacts can defeat personal jurisdiction there.”
Burger King Corp., 471 U.S. at 476 (quoting Keeton v. Hustler Mag., Inc., 465 U.S. 770,
774 (1984)). Instead, “with respect to interstate contractual obligations, . . . parties who
‘reach out beyond one state and create continuing relationships and obligations with
citizens of another state’ are subject to regulation and sanctions in the other State for the
consequences of their activities.” 	Id. at 473 (quoting Travelers Health Ass’n v. Virginia,
339 U.S. 643, 647 (1950)). And for tort claims, “‘purposeful direction’ has three elements:
(a) an 	intentional 	action 	that 	was 	(b) expressly 	aimed 	at 	the 	forum 	state 	with
(c) knowledge that the brunt of the injury would be felt in the forum state.” Newsome v.
Gallacher, 722 F.3d 1257, 1264–65 (10th Cir. 2013) (cleaned up).
The “purposeful availment requirement ensures that a defendant will not be haled
into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts.” Burger
King Corp., 471 U.S. at 475 (quotation omitted). 	Rather, “the contract relied upon to
establish minimum contacts must have a ‘substantial connection’ with the forum state.”
TH Agric. & Nutrition, LLC v. Ace Euro. Grp. Ltd., 488 F.3d 1282, 1288 (10th Cir. 2007)
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(quoting McGee v. Int’l Life Ins. Co., 355 U.S. 220, 223 (1957)); see also Burger King
Corp., 471 U.S. at 475 n.18 (“So long as it creates a ‘substantial connection’ with the
forum, even a single act can support jurisdiction.”). “To determine whether a nonresident
defendant has purposefully established minimum contacts with the forum state by
contracting with another party, we therefore examine ‘prior negotiations and contemplated
future consequences, along with the terms of the contract and the parties’ actual course
of dealing.” TH Agric. & Nutrition, LLC, 488 F.3d at 1288 (quoting Burger King Corp., 471
U.S. at 479). 	In this regard, “[p]hone calls, letters, facsimiles, and emails ‘provide
additional evidence that [a foreign defendant] pursued a continuing business relationship
with [a plaintiff].’” 	AST Sports Sci., Inc., 514 F.3d at 1059 (quoting Pro Axess v. Orlux
Distrib., 	Inc., 	428 	F.3d 	1270, 	1278 	(10th 	Cir. 	2005)); 	see 	also 	id. 	(“[M]odern
communications 	can 	eliminate 	the 	need 	for 	physical 	presence.”). 	“In 	proper
circumstances, even a single letter or telephone call to the forum state may meet due
process standards.” Rambo v. Am. So. Ins. Co., 839 F.2d 1415, 1418 (10th Cir. 1988).
“The proper focus for analyzing these contacts is whether they represent an effort by the
defendant to ‘purposefully avail[ ] itself of the privilege of conducting activities within the
forum State.’” 	Id. at 1419 (alteration in original) (quoting Hanson v. Denckla, 357 U.S.
235, 253 (1958)).
Finally, even if a defendant’s minimum contacts with the forum state give rise to
the cause of action at bar, courts may not exercise specific personal jurisdiction over a
foreign defendant where doing so would offend “traditional notions of fair play and
substantial justice.” 	Dudnikov, 514 F.3d at 1071. 	That inquiry implicates the following
factors: 	“(1) the burden on the defendant, (2) the forum state’s interest in resolving the
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dispute, (3) the plaintiff’s interest in receiving convenient and effective relief, (4) the
interstate 	judicial 	system’s 	interest 	in 	obtaining 	the 	most 	efficient 	resolution 	of
controversies, and (5) the shared interest of the several states in furthering fundamental
substantive social policies.” OMI Holdings, Inc., 149 F.3d at 1095. “The reasonableness
prong of the due process inquiry evokes a sliding scale: the weaker the plaintiff’s showing
on minimum contacts, the less a defendant need show in terms of unreasonableness to
defeat jurisdiction.” 	Benton v. Cameco Corp., 375 F.3d 1070, 1079 (10th Cir. 2004)
(cleaned up).
II. 	Personal Jurisdiction over Palisades
In the Motion to Dismiss, Palisades asserts that Plaintiff cannot establish either
general or specific personal jurisdiction. 	See [Doc. 17 at 8–12]. 	In support of this
argument, Palisades attaches an affidavit from Michael Jordan (“Mr. Jordan”), one of the
company’s executives, who attests to various facts about its business activities. 	See
[Doc. 18 at 3–4].
According to Mr. Jordan, Palisades is a “sales finance company” based in
Montville, New Jersey, which holds state banking licenses in only New York and New
Jersey. [Id. at ¶ 3]. Palisades “negotiates loan agreements, issues and enters into loan
agreements, and collects payments from customers” at the New Jersey headquarters.
[Id.]. 	Mr. Jordan attests that Plaintiff entered into the loan agreement for the subject
vehicle at 26 Motors’s physical location in New York, and that Palisades “negotiated and
issued the loan to Mr. Beachley from its headquarters” in New Jersey. 	[Id. at ¶ 4].
Palisades 	also 	executed 	the 	Settlement 	Agreement 	and 	“conducted 	all 	activities
regarding its duties under the [Settlement Agreement]” from its New Jersey headquarters.
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[Id. at ¶ 5]. 	And all of Defendant’s communications with credit bureaus with respect to
Plaintiff and his credit took place from New Jersey. [Id. at ¶ 3].
Mr. Jordan further attests that Palisades has no employees, real estate, locations,
offices, independent contractors, representatives, or agents in Colorado, and that while it
maintains a generally accessible website it does not advertise online and “in no way
purposefully directs online activity, advertising, or marketing into the state of Colorado
with the intent of engaging in business in Colorado.” [Id. at ¶¶ 6–7]. Finally, and contrary
to the Complaint, Mr. Jordan states that Palisades “does not have any common ownership
or any common employees with 26 Motors.” [Id. at ¶ 8].
In 	his 	response, 	Plaintiff 	concedes 	that 	“general 	jurisdiction 	is 	probably
unavailable” here. 	[Doc. 28 at ¶ 23]. 	Given that Plaintiff is a New Jersey corporation
headquartered in New Jersey, see [Doc. 34], this Court concludes that Plaintiff has failed
to sustain his burden of establishing general jurisdiction.
However, Plaintiff argues that specific jurisdiction is present. 	Plaintiff recognizes
that “a finance company does not by virtue of the nature of its business have ‘minimum
contacts’ with a plaintiff located in another jurisdiction automatically,” but contends that
the Settlement Agreement changed things.3 [Doc. 28 at ¶¶ 33–34]. Plaintiff argues that
minimum contacts exist because the Settlement Agreement recognized that he was a
3 Plaintiff also suggests in passing that personal jurisdiction may have preceded the
Settlement Agreement with Palisades: “Admittedly, and standing alone, prior to the loan
agreement, Defendant’s contacts with this jurisdiction fall short of the ‘minimum contacts’
standard. That was true—until it was sued in New York District Court.” [Doc. 28 at ¶ 32].
The Court finds this notion meritless. 	On the facts, Plaintiff has not alleged that he
previously sued Palisades in any jurisdiction. See, e.g., [Doc. 7-3 at ¶ 22 (Plaintiff alleging
that he sued 26 Motors in New York)]. On the law, Plaintiff provides no authority for the
proposition that a litigant may hale an adversary into the litigant’s forum of choice simply
by first suing them elsewhere. See generally [Doc. 28].
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Colorado resident, “Defendant’s compliance with the agreement directly affected” him,
and Defendant “intentionally violated the agreement” as alleged in the Complaint. [Id. at
¶ 35]; see also [id. at ¶ 36 (“[T]he lawsuit and subsequent Settlement Agreement
contemplated 	performance 	within 	this 	jurisdiction, 	affecting 	a 	resident 	of 	this
jurisdiction.”)].
Plaintiff’s Response appends several documents. 	First, Plaintiff includes a copy
of the Settlement Agreement with Palisades and 26 Motors. 	See [Doc. 28-1]. 	The
Settlement Agreement specifies a Colorado address for Plaintiff and contemplates
potential enforcement proceedings, but does not contain any forum-related provisions.
See [id. at 1–2]. 	Second, Mr. Beachley has submitted a declaration in which he attests
to his residency in Denver and to the accuracy of the representations in the Response.
[Doc. 28-2 at ¶¶ 1, 5]. As the Response never references Mr. Beachley’s declaration, the
Court takes this filing as an attempt to provide an evidentiary basis for any jurisdictionally
relevant facts in Plaintiff’s briefing that do not appear in his Complaint. From the Court’s
review, however, the only new assertions in the Response are: (1) that “Plaintiff has had
a career in the credit industry, including performing services as a Loan Officer, Account
Manager, 	and 	Digital 	Marketing 	firm 	account/profile 	manager”; 	(2) that 	Plaintiff’s
unawareness of the loan amount discrepancy was “rather foolish[],” and (3) that Palisades
and 26 Motors shared an address. 	See [Doc. 28 at ¶¶ 1, 4, 6]. 	None of this has any
relevance to the Court’s exercise of personal jurisdiction over Palisades.4 Finally, Plaintiff
4 The Parties dispute the relationship between Palisades and nonparty 26 Motors, so the
Court, for the purposes of this instant Motion, accepts Plaintiff’s assertions as true. See
Wenz, 55 F.3d at 1505. However, any relationship is immaterial to personal jurisdiction.
To 	be 	sure, 	the 	Complaint 	centers 	its 	jurisdictional 	allegations 	on 	the 	supposed
relationship between these two entities. 	See [Doc. 7-3 at ¶ 11 (alleging that Palisades
engaged in minimum contacts with Colorado and then discussing its relationship with 26
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has filed several documents from his prior litigation against 26 Motors, including the
summons, a pleading, and various documents associated with the underlying vehicle
purchase. See generally [Doc. 28-3]. Plaintiff does not explain how any of this bears on
personal jurisdiction over Palisades, and the Court cannot independently discern any
relevance. See generally [Doc. 28].5
Although Plaintiff recites case law regarding purposeful direction in the personal-
jurisdiction context, see, e.g., [id. at ¶ 37], his allegations do not show that Palisades
purposefully directed sufficient activities toward Colorado to support exercising this
Court’s jurisdiction. 	As the Court reads the Complaint and documents submitted in
connection with the Motion to Dismiss, Palisades settled a New York dispute with Plaintiff
in a way that contemplated Palisades taking certain action with respect to credit bureaus,
and the failure of Palisades to comply with its obligations allegedly renders it liable for
fraud. 	But the mere existence of the Settlement Agreement is insufficient to establish
Motors and the latter’s online advertisements that reached Plaintiff in Colorado and led to
the purchase of the subject vehicle)]. And the Motion to Dismiss tracked this jurisdictional
theory. See [Doc. 17 at 11–12]. But Plaintiff, who bears the burden on jurisdiction, does
not pursue this argument in his brief. See [Doc. 28 at ¶¶ 23–42]; see also [Doc. 39 at 3
(“In his Response, Plaintiff disregards the jurisdictional facts pled in the Complaint, i.e.,
that Palisades has common ownership with 26 Motors and 26 Motors advertised to
Plaintiff via the internet, and proffers a new, unsupported theory that the SAR, formed in
the State of New York, somehow subjects Palisades to this Court’s jurisdiction.”)]. Even
if this argument were before the Court, however, Plaintiff exclusively alleges that the
online advertisements were distributed by 26 Motors, not Palisades, and Plaintiff provides
no authority supporting the Court’s jurisdiction over Palisades under such circumstances.
See [Doc. 7-3 at ¶ 11]; see generally [Doc. 28].
5 Palisades makes evidentiary objections to certain of these documents. See [Doc. 39 at
2–3]. The Court need not evaluate these objections, however, because these documents
do not alter the Court’s personal jurisdiction analysis. See [id. at 1 (arguing that, “[e]ven
if the Court overrules Palisades’s evidentiary objections contained herein, Plaintiff’s self-
serving, generic declaration and the [Settlement Agreement] fail to controvert Palisades’s
jurisdictional evidence”)].
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jurisdiction, notwithstanding Plaintiff’s Colorado residency. See Dental Dynamics, LLC v.
Jolly Dental Grp., LLC, 946 F.3d 1223, 1230 (10th Cir. 2020) (“[A]n out-of-state resident’s
contract with a resident of the forum state is insufficient, standing alone, to create personal
jurisdiction.”).
To the extent Plaintiff suggests that Defendant’s alleged noncompliance with the
Settlement Agreement “directly affected” him for purposes of his fraud claim under the
“effects test” for tort claims, [Doc. 28 at ¶¶ 35, 39–40], “[p]urposeful direction in [the tort]
context has three elements: 	(1) an intentional action; (2) expressly aimed at the forum
state; and (3) with knowledge that the brunt of the injury would be felt in the forum state.”
Dental Dynamics, LLC, 946 F.3d at 1231. 	Here, even as he recognizes that “minimum
contacts in the forum state must be ones created by the defendant through his own
conduct,” [Doc. 28 at ¶ 40], Plaintiff does not explain how Defendant “expressly aimed”
any of its conduct at Colorado, nor does Plaintiff specifically articulate how any of
Defendant’s conduct affected Colorado. Plaintiff does not address or rebut Mr. Jordan’s
submission that all communications between Palisades and the credit bureaus originated
from New Jersey, [Doc. 18 at ¶ 3], and there is no suggestion that Palisades directed any
of these communications to Colorado, see Eighteen Seventy, LP v. Jayson, 32 F.4th 956,
969 (10th Cir. 2022) (under the effects test, “the forum state must be the ‘focal point’ of
the defendant’s tortious conduct” (emphasis omitted)). 	Accordingly, even if Palisades
acted intentionally and knew that Plaintiff would be injured in Colorado where he resided,
the second element of the “effects test” is not satisfied. See Dental Dynamics, LLC, 946
F.3d at 1232 (in fraud claim based on contract, “allegedly fraudulent misrepresentations
and isolated incidents of outreach” were “insufficient to establish [that defendant]
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‘expressly aimed’ his allegedly tortious misrepresentations at Oklahoma,” even where
defendant “knew [plaintiff] was an Oklahoma entity”).
Plaintiff asserts that “[p]ersonal jurisdiction has also been found where the
defendant knew or should have known that the disputed consumer report would have
adverse effects in the plaintiff’s forum.” 	[Doc. 28 at ¶ 41]. 	But Plaintiff’s cases are
nonbinding and distinguishable. 	See Turner v. Regions Bank, 770 F. Supp. 2d 1244,
1249–52 (M.D. Ala. 2011) (defendant attempted to collect debt in forum state in violation
of injunction issued by forum state court); Rivera v. Bank One, 145 F.R.D. 614, 624
(D.P.R. 1993) (defendant “voluntarily and purposefully generated contacts with this forum
in an effort to collect the outstanding debt”); Mitchell v. BancFirst, No. 2:17-cv-02036-CM-
JPO, 2018 WL 338217, at *4 (D. Kan. Jan. 9, 2018) (defendant “expressly aimed its
activity at Kansas by contacting plaintiff in Kansas regarding the inaccuracies, while still
failing to correct the misinformation which, therefore, caused injury to plaintiff in Kansas”);
Williams v. Student Loan Guarantee Found. of Ark., No. 5:12-cv-02940-MHH-JHE, 2015
WL 241428, at *1 (N.D. Ala. Jan. 20, 2015) (personal jurisdiction waived; no claim for
fraud).6 	Unlike in these cases, Plaintiff’s Complaint does not allege that Palisades
directed any intentional contact toward Colorado. See, e.g., Cole v. Am. Fam. Mut. Ins.
Co., 333 F. Supp. 2d 1038, 1047 (D. Kan. 2004) (“The mere allegation of an intentional
tort, coupled with the injury of a forum resident, does not automatically establish personal
jurisdiction over a nonresident defendant.”). 	And Plaintiff’s common law fraud claim
6 To the extent the Williams court held in the alternative that personal jurisdiction existed
because the defendant “could anticipate that the effects of its actions would be felt in” the
forum state, Williams, 2015 WL 241428, at *2, that is not the standard in the Tenth Circuit,
see Dental Dynamics, LLC, 946 F.3d at 1231–32.
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against Palisades does not arise under the Fair Credit Reporting Act (“FCRA”), which
would implicate particular jurisdictional considerations. Cf. Smith v. Cutler, 504 F. Supp.
2d 1162, 1167 (D.N.M. 2007) (noting that “courts which have addressed the issue of
personal jurisdiction in cases involving alleged FCRA violations resulting from authorized
credit inquiries, view these cases sui generis”).7
In short, Plaintiff has failed to establish that Palisades has minimum contacts with
Colorado that give rise to personal jurisdiction in this case. See [Doc. 39 at ¶ 10 (noting
that “Plaintiff alleges that Palisades violated the terms of the [Settlement Agreement] that
was formed in New York as a result of litigation in New York . . . arising from the sale of
a car in New Jersey”)]. To the extent this litigation arises from the Settlement Agreement,
that contract has no connection to the forum state aside from Plaintiff’s Colorado
residency, which is insufficient to support the exercise of personal jurisdiction. See Dental
Dynamics, LLC, 946 F.3d at 1230. 	To the extent this litigation arises from Palisades
reporting inaccurate information to credit bureaus, there is no allegation that such activity
was expressly aimed toward Colorado. 	See Clear Spring Prop. & Cas. Co. v. Arch
Nemesis, LLC, No. 2:22-cv-02435-DDC-TJJ, 2023 WL 6123741, at *8 (D. Kan. Sept. 19,
2023) (assessing minimum contacts under both contract and tort frameworks for fraud
claim that was “grounded in a contract”). 	The Court respectfully concludes that Plaintiff
has failed to meet his prima facie burden as to personal jurisdiction over Palisades.
7 At one point in Plaintiff’s brief, Plaintiff states that “the genesis of the dispute with
[Palisades] is that it violated [the] FCRA by violating the terms of [the] Settlement
Agreement.” 	[Doc. 28 at ¶ 34]. 	But Plaintiff makes no claim under the FCRA. 	See
generally [Doc. 7-3]. And a plaintiff cannot amend its pleading by raising new allegations
in responding to a motion to dismiss. Sudduth v. CitiMortgage, Inc., 79 F. Supp. 3d 1193,
1198 n.2 (D. Colo. 2015).
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Accordingly, the Motion to Dismiss is GRANTED and Plaintiff’s fraud claim against
Palisades is DISMISSED without prejudice.8
CONCLUSION
For the foregoing reasons, it is ORDERED that:
(1) 	Defendant’s Motion to Dismiss [Doc. 16] is GRANTED;
(2) 	Plaintiff’s 	fraud 	claim 	against 	Defendant Palisades 	Funding, 	Corp. 	is
DISMISSED without prejudice; and
(3) 	The Motion for Temporary Stay Pending Resolution of Defendant Palisades
Funding, Corp.’s Motion to Dismiss [Doc. 46] is DENIED as moot.
DATED: April 29, 2024 	BY THE COURT:
_______________________
Nina Y. Wang
United States District Judge
8 Palisades seeks dismissal with prejudice, [Doc. 17 at 15], but a dismissal for lack of
jurisdiction must be without prejudice because the court “lack[s] jurisdiction to make a
determination on the merits,” Brereton v. Bountiful City Corp., 434 F.3d 1213, 1219 (10th
Cir. 2006). 	Additionally, having dismissed the case as against Palisades, the Court
withdraws the referral of the pending Motion for Temporary Stay Pending Resolution of
Defendant Palisades Funding, Corp.’s Motion to Dismiss (“Motion to Stay”) filed by
Palisades, [Doc. 46], which had been referred to the Honorable Kathryn A. Starnella,
[Doc. 47]. As Palisades is no longer party to this case, the Motion to Stay is DENIED as
moot.
Case No. 1:23-cv-03098-NYW-KAS Document 59 filed 04/29/24 USDC Colorado
pg 15 of 15