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Lin v. Tipranks, Ltd.

United States District Court, D. Massachusetts

November 21, 2019

CHING-YI LIN, Plaintiff,
v.
TIPRANKS, LTD., Defendant.

          MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS

          ALLISON D. BURROUGHS U.S. DISTRICT JUDGE.

         In this defamation suit, Plaintiff Ching-Yi Lin (“Lin”) alleges that Defendant TipRanks, Ltd. (“TipRanks”) wrongfully ranked her extremely low on its financial analyst performance website, which prevented her from obtaining employment as an analyst for almost three years. [ECF No. 1-1 (“Complaint” or “Compl.”) at 8-11]. Lin brought this suit in the Massachusetts Superior Court for Suffolk County on April 17, 2019 and on July 11, 2019, TipRanks removed the case to this Court. [ECF No. 1 at 1]. TipRanks then moved to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2). [ECF No. 10]. Lin opposed the motion to dismiss. [ECF No. 14]. For the reasons stated below, TipRanks' motion to dismiss [ECF No. 10] is GRANTED.

         I. BACKGROUND

         This summary draws from allegations in the Complaint and attestations in the affidavits submitted by the parties. Lin was domiciled in Massachusetts from October 2015 until August 2016, although she now resides in New York. [ECF No. 14-2 ¶¶ 1, 3, 4].[1] Lin is an equity research analyst who advises investors on whether to purchase or sell shares of biotech companies. [Id. ¶ 2]. TipRanks is an Israeli technology company that operates its website exclusively from Israel. [ECF No. 11 at 1]. TipRanks “aggregates and analyzes the financial data that is publicly available online to provide a data-driven measure of accuracy based on the statistical ability of an expert to generate profits from investment recommendations.” [ECF No. 12 ¶ 2]. TipRanks uses this information to rank financial analysts based on their performance. These rankings are then “ma[de] available for free on its website, ” where they can be accessed anywhere and viewed by anyone, including in Massachusetts and by Massachusetts residents. [Id. ¶ 3]. Visitors accessing TipRanks' website also have the option to subscribe to TipRanks' premium services for an annual fee, which provides full access to TipRanks' stock market research tools. [ECF No. 14-1 ¶ 6]. TipRanks is not registered to do business in Massachusetts, has no employees in Massachusetts, does not maintain an office or own any personal or real property in Massachusetts, and does not derive “substantial revenue” from business in Massachusetts. [ECF No. 11 at 3].

         As of 2018, Lin was ranked 4, 771 out of 4, 832 analysts on TipRanks' website. [Compl. at 9]. Lin contends that her ranking was “erroneous” because it was based on two stocks that she had never covered and on stock at a company that did not yet exist at the time her ranking was published. [ECF No. 14-2 ¶ 9].[2] Between November 2015 and August 2016, Lin “applied to at least 100 jobs in the Boston area, ” with no success. [Id. ¶¶ 4-8]. She “would have a series of favorable interviews and then, mysteriously, find herself dropped by companies to which she had tendered applications.” [Compl. at 9]. In 2018, she learned of her poor ranking on TipRanks and shortly thereafter requested that TipRanks remove her ranking. [Id. at 10]. TipRanks agreed to remove Lin's ranking from its website. [Id.]. Once Lin's ranking no longer appeared in a Google search for her name, she received a job offer within a month. [ECF No. 14-2 ¶ 9]. Lin now claims that “the erroneous statements on the TipRanks website . . . damage[d] [her] reputation in the stock analyst community” and were “sufficient to deter potential employers from hiring [her].” [Compl. at 10]. This, in turn, “caused [her] economic loss, and prejudiced her profession, all to her damage.” [Id.].

         II. STANDARD OF REVIEW

         Lin bears the burden of establishing that specific jurisdiction exists over TipRanks. A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 58 (1st Cir. 2016) (citing Phillips v. Prairie Eye Ctr., 530 F.3d 22, 26 (1st Cir. 2008)). “When a district court rules on a motion to dismiss for lack of personal jurisdiction without holding an evidentiary hearing . . ., the ‘prima facie' standard governs its determination.” United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 618 (1st Cir. 2001). Under the prima facie standard, the plaintiff must proffer “evidence which, if credited, is sufficient to support findings of all facts essential to personal jurisdiction.” A Corp., 812 F.3d at 58 (quoting Prairie Eye Ctr., 530 F.3d at 26). “[P]laintiffs may not rely on unsupported allegations in their pleadings, ” and are instead “obliged to adduce evidence of specific facts” supporting jurisdiction. Platten v. HG Berm. Exempted Ltd., 437 F.3d 118, 134 (1st Cir. 2006) (first quoting Boit v. Gar-Tec Prods., Inc., 967 F.2d 671, 675 (1st Cir. 1992), then quoting Foster-Miller, Inc. v. Babcock & Wilcox Can., 46 F.3d 138, 145 (1st Cir. 1995)). The Court takes as true whatever properly documented facts a plaintiff proffers, construes those facts in the light most favorable to the plaintiff, and considers facts put forward by the defendant to the extent they are uncontradicted. See Prairie Eye Ctr., 530 F.3d at 26; Platten, 437 F.3d at 134.

         III. DISCUSSION

         “To establish personal jurisdiction in a diversity case, a plaintiff must satisfy both the forum state's long-arm statute and the Due Process Clause of the Fourteenth Amendment.” C.W. Downer & Co. v. Bioriginal Food & Sci. Corp., 771 F.3d 59, 65 (1st Cir. 2015) (citing Ticketmaster-N.Y., Inc. v. Alioto, 26 F.3d 201, 204 (1st Cir. 1994)). The Due Process Clause of the Fourteenth Amendment allows a state court to exercise personal jurisdiction over a nonresident only where the exercise of jurisdiction “does not offend ‘traditional notions of fair play and substantial justice.'” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (citations omitted). Massachusetts also articulates requirements for when courts may exercise personal jurisdiction over nonresidents through its long-arm statute. Because “the long-arm statute imposes specific constraints on the exercise of personal jurisdiction that are not coextensive with the parameters of due process . . . a determination under the long-arm statute is to precede consideration of the constitutional question.” SCVNGR, Inc. v. Punchh, Inc., 85 N.E.3d 50, 52 (Mass. 2017); see also Cossart v. United Excel Corp., 804 F.3d 13, 18 (1st Cir. 2015) (“The requirements of the Massachusetts long-arm statute are similar to-although not necessarily the same as-those imposed by the Due Process Clause.”).

         A. Massachusetts Long-Arm Statute

         Section 3(c) of the Massachusetts long-arm statute allows for the exercise of “personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action in law or equity arising from the person's . . . causing tortious injury by an act or omission in this commonwealth.” Mass. Gen. Laws ch. 223A, § 3(c). Courts have liberally construed section 3(c) in cases involving out-of-state internet postings. See, e.g., Abiomed, Inc., v. Turnbull, 379 F.Supp.2d 90, 92 (D. Mass. 2005).

         “The ‘arising from' clause in [the long-arm statute] is . . . generously construed in favor of asserting personal jurisdiction, by applying a ‘but for' causation test.” Workgroup Tech. Corp. v. MGM Grand Hotel, LLC., 246 F.Supp.2d 102, 112 (D. Mass. 2003). The arising from inquiry asks “[d]id the defendant's contacts with the Commonwealth constitute the first step in a train of events that result[ed] in the . . . injury.” Access Now, Inc. v. Otter Prods., LLC, 280 F.Supp.3d 287, 291 (D. Mass. 2017) (internal quotation marks omitted) (quoting Lyle Richards Int'l, Ltd. v. Ashworth, Inc., 132 F.3d 111, 114 (1st Cir. 1997)).

         Lin alleges that TipRanks is subject to personal jurisdiction pursuant to section 3(c) of the Massachusetts long-arm statute because “TipRanks' defamatory act occurred ‘in' Massachusetts, ” which is where the defamatory material was disseminated. [ECF No. 14 at 4- 5]. First, the “arising from” clause is satisfied because the online ranking published by TipRanks and allegedly accessed in Massachusetts is a but-for cause of the injury. TipRanks' publication of Lin's erroneous ranking, which was available in Massachusetts, allegedly deterred Massachusetts employers from hiring her, which caused economic loss and damaged her reputation. See, e.g., Roy v. FedEx Ground Package Sys., Inc., No. 3:17-cv-30116, 2018 WL 2324092, at *5 (D. Mass. May 22, 2018) (finding that the “arising from” clause was satisfied where the cause of action stemmed from activities by the defendant occurring in Massachusetts).

         Second, “[w]hen business is transacted over a computer network via a Web-site accessed by a computer in Massachusetts, it takes place as much in Massachusetts, literally or figuratively, as it does anywhere.” Dig. Equip. Corp. v. AltaVista Tech., Inc., 960 F.Supp. 456, 462 (D. Mass. 1997). In addition, “[t]he tort of libel is generally held to occur wherever the offending material is circulated.” Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 777 (1984). Here, because the defamatory material on TipRanks' website was allegedly accessed or ...


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