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Filing # 192242216 E-Filed 02/19/2024 02:25:46 PM
IN THE CIRCUIT COURT OF THE 11TH
JUDICIAL CIRCUIT IN AND FOR
MIAMI-DADE COUNTY, FLORIDA
CIRCUIT CIVIL DIVISION
CASE NO.: 2023-020202-CA-01
CODY KERNS, an individual, et al.,
Plaintiffs,
v.
FXWINNING, LTD., et al.,
Defendants.
/
PLAINTIFFS’ REPLY IN SUPPORT OF THEIR MOTION FOR PROTECTIVE ORDER
AND BRIEFING SCHEDULE RELATED TO DEFENDANTS’ MOTIONS TO DISMISS
Plaintiffs, Cody Kerns (“Kerns”), Kerns Capital Management, Inc. (“Kerns Capital”), and
WFTMB Holdings, LLC (“WFTMB”) (collectively, “Plaintiffs”) hereby file this reply in support
of their Motion for Protective Order and Briefing Schedule Related to Defendants’ Motions to
Dismiss (the “Motion”), and in support, state as follows:
INTRODUCTION
Defendants, FXWinning, Ltd. (“FXWinning”), David Merino (“Merino”), and Rafael Brito
Cutie (“Cutie”) (collectively “Defendants”), ask this Court to turn the personal jurisdiction analysis
on its head. The personal jurisdiction inquiry turns on whether the tort, as alleged, occurred in
Florida – not whether the tort occurred at all. Plaintiffs need only allege a sufficient basis for
personal jurisdiction. Plaintiffs have done that. The burden is now on Defendants to refute
Plaintiffs’ jurisdictional allegations. The burden only shifts back to Plaintiffs to put forth
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evidence supporting their jurisdictional allegations if the Defendants controvert Plaintiffs’
jurisdictional allegations. They have not done that yet.
FXWinning, Merino, and Cutie affirmatively state that they seek to depose Plaintiffs on
jurisdictional facts that Defendants have not controverted. Defendants have not refuted through
their affidavits that Plaintiffs received the alleged misrepresentations in Florida. They have not
even refuted that they made the misrepresentations. They want the Plaintiffs to do this work for
them. That is not how the personal jurisdiction analysis works.
The Court should grant the Motion and enter Plaintiffs’ requested briefing schedule.
MEMORANDUM OF LAW
I. Defendants Do Not Get to Test Jurisdictional Allegations They Have Not Refuted
In Defendants view, they are “entitled to depose Plaintiffs to test, inter alia, whether each
Plaintiff relied on an Alleged Misrepresentation, where Plaintiffs were when they relied on an
Alleged Misrepresentation, and where Plaintiffs (and McGinnis) were residing at the time they
allegedly suffered injury on an Alleged Misrepresentation.” See [DE 164 at 7]. Defendants
fundamentally misunderstand the personal jurisdiction analysis.
“If the plaintiff has sufficiently alleged a basis for long-arm jurisdiction, then the burden
shifts to the defendant to contest those allegations, by affidavit or other proof . . . .” S. Wall
Prods., Inc. v. Bolin, 251 So. 3d 935, 938 (Fla. 4th DCA 2018) (citing Venetian Salami Co. v.
Parthenais, 554 So. 2d 499, 502 (Fla. 1989)) (emphasis added). Defendants concede that they
have not refuted Plaintiffs’ allegations regarding the misrepresentations Plaintiffs allege they relied
on or the location where Plaintiffs saw or heard those misrepresentations. See [DE 164 at 3]
(“Brito’s and Merino’s Declarations did not—and could not—refute the Amended Complaint’s
allegations as to Plaintiffs’ reliance on the Alleged Misrepresentations or the location from where
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Plaintiffs first saw or heard the Alleged Misrepresentations forming the basis of the Tort Claims.”).
That is, Defendants have not contested the very allegations they claim they need to test through
depositions.
When a defendant fails to refute a plaintiff’s jurisdictional allegations, the burden does not
shift back to the plaintiff. See Venetian Salami, 554 So. 2d at 502 (“A defendant wishing to contest
the allegations of the complaint concerning jurisdiction or to raise a contention of minimum
contacts must file affidavits in support of his position. The burden is then placed upon Plaintiff to
prove by affidavit the basis upon which jurisdiction may be obtained.”); S. Wall, 251 So. 3d at 939
(“If adequately contested, the burden shifts back to the plaintiff to refute the evidence the
defendant submitted by affidavit or other evidence.”) (emphasis added); Belz Investco Ltd. P’shp
v. Groupo Immobiliano Cababie, S.A., 721 So. 2d 787, 789 (Fla. 3d DCA 1998) (“If properly
contested, the burden then returns to the plaintiff to refute the evidence submitted by the defendant,
also by affidavit or other proof.”) (emphasis added).
Here, Defendants concede that they have not refuted Plaintiffs’ jurisdictional allegations
regarding the alleged misrepresentations made by Defendants. See [DE 164 at 3]. Defendants’
claim that they logically could not refute Plaintiffs’ allegations misses the point. Defendants have
in no way refuted the alleged misrepresentations. In fact, Defendant Cutie, the CEO of Defendant
FXWinning, testified in his deposition that he played a substantial role in the content posted on the
website and that the website was viewable to persons in the United States. Defendants want
Plaintiffs to prove their case now, but Plaintiffs do not need to do that at this stage. Compare [DE
164 at 7] (“[T]he alleged misrepresentations . . . and the alleged injuries suffered by Plaintiffs, are
material facts that Plaintiffs must prove, by a preponderance of the evidence, for the Court to
exercise specific jurisdiction [over Defendants].”); with OSI Indus., Inc. v. Carter, 834 So. 2d 362,
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366 (Fla. 5th DCA 2003) (explaining that the specific jurisdiction analysis turns on “whether the
tort, as alleged, occurred in Florida, and not whether the tort actually occurred.”). 1
Defendants should not be permitted to depose Plaintiffs on jurisdictional allegations they
have not contested.
II. Defendants Should Not Be Permitted to Develop Affirmative Defenses Under the
Guise of Jurisdictional Discovery
Defendants tacitly concede through their Response that they wish to elicit testimony from
Plaintiffs to develop potential affirmative defenses to the merits of Plaintiffs’ claims. Indeed,
Defendants state that they should be permitted to question Plaintiffs on whether they “used a virtual
private network to access [FXWinning’s] services to conceal that the Plaintiff was a resident of
Florida or otherwise of the United States.” [DE 164 at 8]. But this has nothing to do with whether
personal jurisdiction is appropriate over Defendants in this case. That is, they are facts that are
irrelevant to the issue at hand. And the only thing they could bear relevance on is Defendants
telegraphed forthcoming affirmative defenses based on FXWinning’s purported policy that it does
not accept United States based clients.
The Court should not permit Defendants to use jurisdictional discovery as a delay device
and to start developing affirmative defenses.
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In OSI, plaintiff alleged, as Plaintiffs do here, that defendant committed a tort in Florida by
making misrepresentations to the plaintiff while plaintiff was in Florida. OSI, 834 So. 2d at 363.
The OSI defendant’s affidavit claimed he may have had conversations with the plaintiff while
plaintiff was in Florida but had not made any misrepresentations to the plaintiff. Id. at 364. The
Fifth District affirmed the trial court’s finding that, under those facts, there was no conflict
requiring an evidentiary hearing. Id. at 366. “[A]lthough [defendant] states in his affidavit that he
denies that he made any misrepresentations to Plaintiff, [defendant] does not deny that he may
have called Plaintiff in Florida. As it is the telephone conversation that is the asserted basis of
jurisdiction under [the long-arm statute], and [defendant] does not deny that he called Plaintiff in
Florida, pursuant to Acquadro, this Court has long-arm jurisdiction over [defendant]. Id. at 364
(citing trial court order).
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III. The Court Should Set a Briefing Schedule on Defendants’ Motions to Dismiss
The Court should set the briefing schedule proposed in Plaintiffs’ Motion. Plaintiffs are
prepared to proceed with briefing their responses in opposition to FXWinning’s, Merino’s, and
Cutie’s motions to dismiss. There is no legitimate purpose for Plaintiffs’ jurisdictional depositions.
Plaintiffs request that their deadline be set for March 19, 2024, which is a reasonable thirty (30)
days following the deadline for Defendant FXWinning to respond to Plaintiffs’ limited
jurisdictional request for production.
Dated: February 19, 2024 Respectfully submitted,
SANCHEZ FISCHER LEVINE, LLP
1200 Brickell Avenue, Suite 750
Miami, Florida 33131
Telephone: (305) 925-9947
By: /s/ David M. Levine
David M. Levine, Esq.
Florida Bar No.: 84431
Email: dlevine@sfl-law.com
Secondary: eservice@sfl-law.com
Fausto Sanchez, Esq.
Florida Bar No.: 86229
Email: fsanchez@sfl-law.com
Robert Kemper, Esq.
Florida Bar. No.: 1038549
Email: rkemper@sfl-law.com
Counsel for Plaintiffs
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on February 19, 2024 a true and correct copy of the foregoing
was filed with the Clerk of the Court and served on all counsel of record via the Florida Courts
eFiling Portal.
By: /s/ David M. Levine
David M. Levine, Esq.
5
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Filing # 192242216 E-Filed 02/19/2024 02:25:46 PM IN THE CIRCUIT COURT OF THE 11TH JUDICIAL CIRCUIT IN AND FOR MIAMI-DADE COUNTY, FLORIDA CIRCUIT CIVIL DIVISION CASE NO.: 2023-020202-CA-01 CODY KERNS, an individual, et al., Plaintiffs, v. FXWINNING, LTD., et al., Defendants. / PLAINTIFFS’ REPLY IN SUPPORT OF THEIR MOTION FOR PROTECTIVE ORDER AND BRIEFING SCHEDULE RELATED TO DEFENDANTS’ MOTIONS TO DISMISS Plaintiffs, Cody Kerns (“Kerns”), Kerns Capital Management, Inc. (“Kerns Capital”), and WFTMB Holdings, LLC (“WFTMB”) (collectively, “Plaintiffs”) hereby file this reply in support of their Motion for Protective Order and Briefing Schedule Related to Defendants’ Motions to Dismiss (the “Motion”), and in support, state as follows: INTRODUCTION Defendants, FXWinning, Ltd. (“FXWinning”), David Merino (“Merino”), and Rafael Brito Cutie (“Cutie”) (collectively “Defendants”), ask this Court to turn the personal jurisdiction analysis on its head. The personal jurisdiction inquiry turns on whether the tort, as alleged, occurred in Florida – not whether the tort occurred at all. Plaintiffs need only allege a sufficient basis for personal jurisdiction. Plaintiffs have done that. The burden is now on Defendants to refute Plaintiffs’ jurisdictional allegations. The burden only shifts back to Plaintiffs to put forth 1 evidence supporting their jurisdictional allegations if the Defendants controvert Plaintiffs’ jurisdictional allegations. They have not done that yet. FXWinning, Merino, and Cutie affirmatively state that they seek to depose Plaintiffs on jurisdictional facts that Defendants have not controverted. Defendants have not refuted through their affidavits that Plaintiffs received the alleged misrepresentations in Florida. They have not even refuted that they made the misrepresentations. They want the Plaintiffs to do this work for them. That is not how the personal jurisdiction analysis works. The Court should grant the Motion and enter Plaintiffs’ requested briefing schedule. MEMORANDUM OF LAW I. Defendants Do Not Get to Test Jurisdictional Allegations They Have Not Refuted In Defendants view, they are “entitled to depose Plaintiffs to test, inter alia, whether each Plaintiff relied on an Alleged Misrepresentation, where Plaintiffs were when they relied on an Alleged Misrepresentation, and where Plaintiffs (and McGinnis) were residing at the time they allegedly suffered injury on an Alleged Misrepresentation.” See [DE 164 at 7]. Defendants fundamentally misunderstand the personal jurisdiction analysis. “If the plaintiff has sufficiently alleged a basis for long-arm jurisdiction, then the burden shifts to the defendant to contest those allegations, by affidavit or other proof . . . .” S. Wall Prods., Inc. v. Bolin, 251 So. 3d 935, 938 (Fla. 4th DCA 2018) (citing Venetian Salami Co. v. Parthenais, 554 So. 2d 499, 502 (Fla. 1989)) (emphasis added). Defendants concede that they have not refuted Plaintiffs’ allegations regarding the misrepresentations Plaintiffs allege they relied on or the location where Plaintiffs saw or heard those misrepresentations. See [DE 164 at 3] (“Brito’s and Merino’s Declarations did not—and could not—refute the Amended Complaint’s allegations as to Plaintiffs’ reliance on the Alleged Misrepresentations or the location from where 2 Plaintiffs first saw or heard the Alleged Misrepresentations forming the basis of the Tort Claims.”). That is, Defendants have not contested the very allegations they claim they need to test through depositions. When a defendant fails to refute a plaintiff’s jurisdictional allegations, the burden does not shift back to the plaintiff. See Venetian Salami, 554 So. 2d at 502 (“A defendant wishing to contest the allegations of the complaint concerning jurisdiction or to raise a contention of minimum contacts must file affidavits in support of his position. The burden is then placed upon Plaintiff to prove by affidavit the basis upon which jurisdiction may be obtained.”); S. Wall, 251 So. 3d at 939 (“If adequately contested, the burden shifts back to the plaintiff to refute the evidence the defendant submitted by affidavit or other evidence.”) (emphasis added); Belz Investco Ltd. P’shp v. Groupo Immobiliano Cababie, S.A., 721 So. 2d 787, 789 (Fla. 3d DCA 1998) (“If properly contested, the burden then returns to the plaintiff to refute the evidence submitted by the defendant, also by affidavit or other proof.”) (emphasis added). Here, Defendants concede that they have not refuted Plaintiffs’ jurisdictional allegations regarding the alleged misrepresentations made by Defendants. See [DE 164 at 3]. Defendants’ claim that they logically could not refute Plaintiffs’ allegations misses the point. Defendants have in no way refuted the alleged misrepresentations. In fact, Defendant Cutie, the CEO of Defendant FXWinning, testified in his deposition that he played a substantial role in the content posted on the website and that the website was viewable to persons in the United States. Defendants want Plaintiffs to prove their case now, but Plaintiffs do not need to do that at this stage. Compare [DE 164 at 7] (“[T]he alleged misrepresentations . . . and the alleged injuries suffered by Plaintiffs, are material facts that Plaintiffs must prove, by a preponderance of the evidence, for the Court to exercise specific jurisdiction [over Defendants].”); with OSI Indus., Inc. v. Carter, 834 So. 2d 362, 3 366 (Fla. 5th DCA 2003) (explaining that the specific jurisdiction analysis turns on “whether the tort, as alleged, occurred in Florida, and not whether the tort actually occurred.”). 1 Defendants should not be permitted to depose Plaintiffs on jurisdictional allegations they have not contested. II. Defendants Should Not Be Permitted to Develop Affirmative Defenses Under the Guise of Jurisdictional Discovery Defendants tacitly concede through their Response that they wish to elicit testimony from Plaintiffs to develop potential affirmative defenses to the merits of Plaintiffs’ claims. Indeed, Defendants state that they should be permitted to question Plaintiffs on whether they “used a virtual private network to access [FXWinning’s] services to conceal that the Plaintiff was a resident of Florida or otherwise of the United States.” [DE 164 at 8]. But this has nothing to do with whether personal jurisdiction is appropriate over Defendants in this case. That is, they are facts that are irrelevant to the issue at hand. And the only thing they could bear relevance on is Defendants telegraphed forthcoming affirmative defenses based on FXWinning’s purported policy that it does not accept United States based clients. The Court should not permit Defendants to use jurisdictional discovery as a delay device and to start developing affirmative defenses. 1 In OSI, plaintiff alleged, as Plaintiffs do here, that defendant committed a tort in Florida by making misrepresentations to the plaintiff while plaintiff was in Florida. OSI, 834 So. 2d at 363. The OSI defendant’s affidavit claimed he may have had conversations with the plaintiff while plaintiff was in Florida but had not made any misrepresentations to the plaintiff. Id. at 364. The Fifth District affirmed the trial court’s finding that, under those facts, there was no conflict requiring an evidentiary hearing. Id. at 366. “[A]lthough [defendant] states in his affidavit that he denies that he made any misrepresentations to Plaintiff, [defendant] does not deny that he may have called Plaintiff in Florida. As it is the telephone conversation that is the asserted basis of jurisdiction under [the long-arm statute], and [defendant] does not deny that he called Plaintiff in Florida, pursuant to Acquadro, this Court has long-arm jurisdiction over [defendant]. Id. at 364 (citing trial court order). 4 III. The Court Should Set a Briefing Schedule on Defendants’ Motions to Dismiss The Court should set the briefing schedule proposed in Plaintiffs’ Motion. Plaintiffs are prepared to proceed with briefing their responses in opposition to FXWinning’s, Merino’s, and Cutie’s motions to dismiss. There is no legitimate purpose for Plaintiffs’ jurisdictional depositions. Plaintiffs request that their deadline be set for March 19, 2024, which is a reasonable thirty (30) days following the deadline for Defendant FXWinning to respond to Plaintiffs’ limited jurisdictional request for production. Dated: February 19, 2024 Respectfully submitted, SANCHEZ FISCHER LEVINE, LLP 1200 Brickell Avenue, Suite 750 Miami, Florida 33131 Telephone: (305) 925-9947 By: /s/ David M. Levine David M. Levine, Esq. Florida Bar No.: 84431 Email: dlevine@sfl-law.com Secondary: eservice@sfl-law.com Fausto Sanchez, Esq. Florida Bar No.: 86229 Email: fsanchez@sfl-law.com Robert Kemper, Esq. Florida Bar. No.: 1038549 Email: rkemper@sfl-law.com Counsel for Plaintiffs CERTIFICATE OF SERVICE I HEREBY CERTIFY that on February 19, 2024 a true and correct copy of the foregoing was filed with the Clerk of the Court and served on all counsel of record via the Florida Courts eFiling Portal. By: /s/ David M. Levine David M. Levine, Esq. 5