United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
DENISE J. CASPER, District Judge.
Plaintiff Barbara Newman ("Newman") brings this action against twenty defendants under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132 et seq., and the whistleblower provisions of the Sarbanes-Oxley Act of 2002 ("SOX"), 18 U.S.C. § 1514A. The LBHI Defendants (defined below) have moved to dismiss the claims against them in Newman's second amended complaint ("SAC") pursuant to Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction; 12(b)(5) for insufficient service of process; and Fed.R.Civ.P. 12(b)(6) for failure to state a claim. D. 107, 111. For the reasons stated below, the Court ALLOWS the motion. The case will proceed only as to Newman's ERISA claim against defendants Metropolitan Life Insurance Co. ("Metlife") and Lehman Brothers Holdings Inc. Group Benefits Plan (the "Plan").
II. Standard of Review
A. Lack of Personal Jurisdiction Pursuant to Rule 12(b)(2)
In the face of a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of showing that personal jurisdiction exists. Astro-Med, Inc. v. Nihon Kohden Am., Inc. , 591 F.3d 1, 8 (1st Cir. 2009). The Massachusetts long-arm statute extends specific jurisdiction to the full extent permitted by due process, so the Court may proceed directly to the constitutional analysis. Adelson v. Hananel , 652 F.3d 75, 80 (1st Cir. 2011). Each defendant must have minimum contacts with Massachusetts such that the "maintenance of the suit does not offend traditional notions of fair play and substantial justice." Int'l Shoe Co. v. Washington , 326 U.S. 310, 316 (1945) (internal quotation marks omitted).
There are two types of personal jurisdiction - general and specific. A defendant is subject to general jurisdiction if it has engaged in "continuous and systematic activity" in the forum unrelated to the lawsuit. Pritzker v. Yari , 42 F.3d 53, 60 (1st Cir. 1994). Specific jurisdiction requires that a plaintiff's claim be related to the defendant's contacts with the forum. Id . The Court conducts a three-part inquiry to determine whether it may exercise specific personal jurisdiction over a defendant: relatedness, purposeful availment and reasonableness. Astro-Med , 591 F.3d at 9.
B. Motion to Dismiss Pursuant to Rule 12(b)(6)
In considering a motion to dismiss for failure to state a claim upon which relief can be granted pursuant to Fed.R.Civ.P. 12(b)(6), the Court will dismiss a pleading that fails to plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570 (2007). To state a plausible claim, a claim need not contain detailed factual allegations, but it must recite facts sufficient to at least "raise a right to relief above the speculative level... on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Twombly , 550 U.S. at 555. "A pleading that offers labels and conclusions' or a formulaic recitation of the elements of a cause of action will not do.'" Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009) (quoting Twombly , 550 U.S. at 555). To determine plausibility, the Court must separate "the complaint's factual allegations (which must be accepted as true)... from its conclusory legal allegations (which need not be credited)." Morales-Cruz v. Univ. of P.R. , 676 F.3d 220, 224 (1st Cir. 2012). The Court must then "determine whether the factual allegations are sufficient to support the reasonable inference that the defendant is liable for the misconduct alleged.'" García-Catalán v. United States , 734 F.3d 100, 103 (1st Cir. 2013) (quoting Haley v. City of Boston , 657 F.3d 39, 46 (1st Cir. 2011)).
C. Insufficient Service of Process Pursuant to Rule 12(b)(5)
"Effectuation of service is a precondition to suit." Jenkins v. City of Topeka , 136 F.3d 1274, 1275 (10th Cir. 1998). While a defendant bears the initial burden to challenge the validity of service of process, once a defendant makes a Fed.R.Civ.P. 12(b)(5) motion, the burden shifts to the plaintiff to establish that process was appropriate. Morse v. Mass. Exec. Office of Public Safety, No. 12-cv-40160-TSH, 2013 WL 1397736, at * 1 (D. Mass. April 4, 2013); see Blair v. City of Worcester , 522 F.3d 105, 111-12 (1st Cir. 2008) (stating that the burden of proving proper service returns to plaintiff after defendant rebuts presumption of proper service arising from return of service).
III. Factual Background
Unless otherwise indicated, the facts are as alleged in the SAC. Newman was formerly employed by the Corporate Communications department of Lehman Brothers Inc. ("LBI"). D. 103 ¶ 7. She alleges that she worked for the Investment Management Division, presumably of LBI, and for "Neuberger Berman, " then a wholly-owned subsidiary of LBI. Id. at 1-2.
Newman believed that LBI was violating securities laws and reported her concerns to her superiors, to LBI via an "alert line" and ultimately to the Securities and Exchange Commission ("SEC"). Id . ¶¶ 8-10. Newman alleges that various defendants retaliated against her for reporting unlawful conduct by LBI and its subsidiaries by terminating her employment and interfering with her benefits. Id. at 4 & ¶¶ 44-45. On July 23, 2008, Newman filed a complaint under Section 806 of SOX with the Occupational Safety and Health Administration ("OSHA"). D. 103 at 5, D. 108-1. In Count I of the SAC, Newman claims that the alleged retaliatory actions, namely her termination and interference with her benefits, constitute violations of SOX. D. 103 ¶¶ 42-45. Count I is asserted against three groups of defendants. The first group comprises LBI and the Plan (collectively, the "Lehman Defendants"). Id. at 1, 3. The second group consists of Neuberger Berman, LLC; Neuberger Berman, Inc.; Neuberger ...