By Jeff Birren
Zion Williamson was born play basketball. Even at an early age, it became obvious that he was going to be a high NBA draft choice and generate millions of dollars. Williamson played at Duke University during the 2018-2019 college season. After just one season Williamson declared for the NBA draft. He then signed a “Marketing and Branding Agreement” (“Agreement”) with Florida-based Prime Sports Marketing, LLC. That relationship lasted just weeks, as Williamson “formally terminated with Prime Sports” and replaced it with Creative Artist Agency. One week prior to the NBA Draft, Williamson sued Prime Sports in North Carolina federal court, seeking a declaration that the Agreement was unenforceable under North Carolina law.
Prime Sports responded to Williamson’s lawsuit by suing in Florida state court. Prime Sports alleged claims for breach of contract and tort, asserting that Florida’s long-arm statute gave the Florida state court jurisdiction. Williamson moved to dismiss the Complaint based on his lack of contact with Florida. The trial court denied the motion and Williamson appealed. On December 2, 2020, the Florida Court of Appeal reversed the trial court’s “denial of Williamson’s motion to dismiss for lack of personal jurisdiction” (Williamson v. Prime Sports Marketing, LLC, Court of Appeal of Florida, Third District, 2020 Fla. App. LEXIS 17103; 2020 WL 7049996 (“Prime Sports”) (12-2-20) at 8).
Facts
Williamson was born in North Carolina and played high school basketball in South Carolina. He was the subject of intense recruiting efforts and committed to Duke on a live ESPN broadcast. In his only year of college basketball, Williamson was Atlantic Coast Conference Rookie of the Year, Player of the Year, ACC Tournament MVP, and ACC Athlete of the Year. He was named national player of the year by AP and the Sporting News.
Prime Sports is owned by Gina Ford (Id. at 4). According to her Facebook page, she was born in Jamaica and went to high school in Miami. It does not say that she attended college. Her LinkedIn page states that she is the “global Commercial Agent for Usain Bolt.” Ford “went to North Carolina on multiple occasions to discuss the possibility of Prime Sports becoming Williamson’s agent for branding and marketing. Williamson declared for the draft on April 15, 2019 and signed a contract with Prime Sports “at his home in North Carolina” five days later (Id.).
Williamson ended the relationship with Prime Sports on May 31, 2019. Ford threatened to sue Williamson for breach of contract, so Williamson sued Prime Sports and Ford in North Carolina federal court, seeking a judicial declaration that the Agreement was void (clutchpoints.com, R.P. Salao, “Everything You Need to Know About the Zion Williamson, Duke Lawsuit” (6-24-20)). Prime Sports responded by suing Williamson, CAA and others associated with CAA in Florida state court on June 19, 2019, the day before the NBA draft, seeking a mere $100,000,000 in damages (Id.). The very next day, the New Orleans Pelicans selected Williamson with the first pick of the NBA draft. His rookie season was marred by an injury, but he was selected to the All-Rookie team.
Williamson filed a motion to dismiss the Complaint, arguing that it “failed to allege sufficient jurisdictional facts to bring the action with the ambit of Florida’s long-arm-statute or satisfy the constitutional minimum contacts requirement.” Williamson submitted an affidavit that stated that not only is he not a resident of Florida, none of his “interactions” with Prime Sports “occurred or related to Florida.” Prime Sports filed an opposition, and a declaration from Ford “which emphasized Prime Sports’ connections to Florida and Williamson’s alleged communications with Prime Sports” (Prime Sports at 4).
At the hearing Prime Sports “primarily focused on its undisputed contact with Florida and Williamson’s communications with Prime Sports.” Williamson tried to argue that the correct focus should be on his contact with Florida, but the trial court denied his motion. Williamson appealed that decision. The other defendants did not join his appeal (Id. FN 3).
In the Court of Appeal
The Court reviews such motions “de novo.” It uses a two-prong jurisdictional test. The first step is to “determine whether the complaint alleges sufficient jurisdictional facts to bring the action within the ambit of Florida’s long-arm statute. If that test is met, the “next inquiry” is whether there are sufficient “minimum contacts” to “satisfy the due process requirements” (Id. at 5). The Court uses a shifting burden of proof test. If the allegations in the complaint “sufficiently establish long-arm jurisdiction” then the defendant has the burden to show that “federal minimum contacts requirement is not met.” If that happens, the burden shifts back to the plaintiff to “refute the evidence submitted by the defendant” (Id.).
The Complaint “contains few jurisdictional allegations.” “According to the Complaint, Williamson is a resident of South Carolina” but there were “no allegations that directly state the trial court has jurisdiction over Williamson. The only explicit jurisdictional allegations applicable to Williamson relies on the Agreement’s choice of law provision.” However, it “is undisputed on appeal that a choice of law provision alone is insufficient to subject a nonresident defendant to personal jurisdiction” (Id.). The Court then turned to Florida’s long-arm statute.
That statute lists specific acts that could subject a nonresident defendant to Florida jurisdiction. Those acts include breaching “a contract in this state by failing to perform acts required by the contract to be performed in this state. § 48.193(1)(a)(7) Fla. Stat.”; “[O]perating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state. (§ 48.193(1)(a)(1) Fla. Stat.”; or “[C]ommitting a tortious act within this state. § 48.193.(1)(a)(2). Fla. Stat.” The Court addressed “Prime Sports’ argument with respect to each of these acts in turn” (Id. at 6).
“Breach of Contract Allegations”
Prime Sports asserted that when Williamson failed to pay Prime Sports, he “breached the express terms of the Agreement” and this “is sufficient to subject” him to Florida jurisdiction. However, the cited code section requires that the “breaching conduct must be a failure ‘to perform acts required by the contract to be performed in [Florida]’” (Id., emphasis in the original). Unfortunately for Prime Sports, the allegation “is silent as to whether the breaching conduct occurred in Florida or whether performance” was required there. Furthermore, “the Agreement itself does not require any acts to be performed in Florida” (Id.).
Prime Sports responded by arguing that there is a “legal presumption” that “a debt is to be paid at the creditor’s place of business.” The allegations, however, “say nothing about this. In other words, there is no allegation in the Complaint that Williamson breached by failing to pay a debt in Florida.” Moreover, in the cases cited by Prime Sports, the complaints “alleged jurisdiction based on a payment that was to be made in Florida” (Id.). That was not in Prime Sports’ Complaint, so those cases were of no use in opposing the motion.
“Business Allegations”
Prime Sports next assertion was that “the allegations of the complaint and the evidence in the affidavit demonstrate clearly that Williamson is subject to long-arm jurisdiction because he was ‘operating, conducting, engaging in, or carrying on a business venture in this state’” (Id. at 7). Prime Sports did not, however, “cite the specific allegations or evidence” that it had in mind, and in its “Answer Brief,” “Prime Sports actually admits that this specific argument was not raised below” (Id.).
Prime Sports cited three cases wherein a non-resident was held to be engaged in business activities in Florida. In the first case the defendant bank had “ten separate oral contracts” during a two-year period. In the second case, a Texas resident “initiated more than 120 transactions” over a two-year period. In the third case, the California defendants had some 100 telephone calls with the Florida plaintiff and the plaintiff that raised over $300,000 from Florida residents and the plaintiff had “also previously helped with other investments” (Id.). Conversely, Williamson’s contact with Florida was limited to a single month and one transaction. Prime Sports placed a single television commercial. It received “$100,000 directly from the producers, retained a 15% commission” and sent $85,000 to Williamson. This “single transaction is not the same as the collective business activities” in the cases cited by Prime Sports. Furthermore, “it is not clear how any of Prime Sports’ claims arise from this transaction, as required by the long-arm statute” (Id., emphasis in the original).
“Tort Allegations”
Prime Sports stated that Ford “met Williamson in California and provided him with an ‘extensive and comprehensive’ marketing plan, which included numerous multi-million-dollar opportunities” that it had obtained for Williamson (Id.). The Complaint asserted that Williamson requested the plan to “facilitate a direct working relationship” between Prime Sports and Williamson’s NBA agent. It also claimed that the stated reason “was false, misleading and untrue” and this in turn established Florida long-arm jurisdiction as it was a tort committed in Florida. Prime Sports cited a case wherein one of the defendants had submitted fraudulent invoices for work that was to have been done in Florida and mailed invoices and check to Florida to be co-signed there (Id. at 8). That is all well and good, but Prime Sports’ allegations “do not mention Florida nor do they mention Florida’s long-arm statute” (Id.).
It was also “unclear” whether the alleged misrepresentations “were made at in-person meetings between Prime Sports and Williamson, all of which occurred outside of Florida, or whether the misrepresentations occurred via telephone or email.” Prime Sports argued that “Williamson’s requests, including the request to meet in California were directed to Plaintiffs in Florida.” However, it was not the requests to meet that were allegedly fraudulent but the reasons for requesting the marketing plan. Yet the affidavit did not say anything about “the allegedly fraudulent reasons for requesting the marketing plain being directed to Florida; it simply states that the invitations to all in-person meetings outside of Florida were sent by Williamson to Florida phone numbers, email addresses, and office addresses” (Id.).
The Court’s Conclusion
The Court stated that Prime Sports had “failed to allege sufficient jurisdictional facts to bring its action” within Florida’s long-arm statute, and thus reversed “the denial of Williamson’s motion to dismiss.” It therefore remanded the case without prejudice to allow Prime Sports to amend its Complaint (Id.).
Prime Sports may see its claims live another day. However, as mentioned above, this is not the only case between Williamson, Prime Sports, and Ford. The results of the federal case may impact what Prime Sports can maintain in an amended complaint in Florida, and it is to that case we will next turn our attention.
Jeff Birren is the former general counsel of the Oakland Raiders, an adjunct sports law professor, and a senior writer for Hackney Publications.
