Reid Pascarella v. Sandals Resorts International

Background

Ashley and Jeffrey Pascarella planned a destination wedding at a resort operated by Sandal Royal Bahamian Spa Resort & Offshore Island (SRB) in the Bahamas. The wedding was booked through Travel Impressions, Ltd. (TI). The complaint alleged that, during the stay, an SRB butler entered Ashley Pascarella’s bedroom and sexually assaulted her. The butler was later charged with indecent assault in a Bahamian court.

The Pascarellas sued SRB, its parent company, Sandals Resort International, Ltd. (SRI), and TI. Their claims included negligence, loss of consortium for Jeffrey Pascarella, and breach of contract. The defendants filed several motions to dismiss.

Fraudulent Joinder

The defendants jointly asked the court to dismiss TI on the ground that TI had been fraudulently joined to defeat federal diversity jurisdiction. The court denied that motion. It found that the Pascarellas were alleged to be citizens of New Jersey and that TI was a citizen of New York, so the parties remained completely diverse for purposes of diversity jurisdiction. The court explained that TI’s presence did not eliminate subject-matter jurisdiction, even though TI would not have been entitled to remove the case under the separate procedural rule concerning an in-state defendant.

Because TI’s inclusion did not destroy diversity jurisdiction, the court did not decide whether TI had been fraudulently joined. Instead, it considered TI’s ordinary motion to dismiss for failure to state a claim.

Personal Jurisdiction Over SRI and SRB

SRI and SRB moved under Federal Rule of Civil Procedure 12(b)(2), which allows dismissal when the court lacks personal jurisdiction over a defendant. The court concluded that neither company was subject to general personal jurisdiction in New York. SRB was incorporated and headquartered in the Bahamas and operated a resort there. It did not own property, operate an office, or have employees or officers in New York. SRI was incorporated and headquartered in Jamaica and likewise did not have property, offices, employees, or officers in New York.

The Pascarellas argued that New York had specific personal jurisdiction because TI acted as SRI’s and SRB’s agent in selling travel packages in New York. The court rejected that argument. It found that the Pascarellas had not provided facts showing that SRI or SRB controlled TI in connection with their trip. The court also found that the available evidence described TI as a middleman and packager that forwarded reservations to a tour operator, which set the rates and policies. The court therefore granted SRI’s and SRB’s motions to dismiss for lack of personal jurisdiction.

Claims Against TI

TI moved under Rule 12(b)(6), which permits dismissal when a complaint does not allege enough facts to state a legally plausible claim. The court found no actual conflict between New York and Bahamian law on the agency-law issues relevant to the motion, so it did not make a choice-of-law finding.

The court concluded that the complaint did not explain how TI could be negligent in hiring or training an employee of a separate corporation in another country. It also did not identify a contractual duty owed by TI or an action by TI that breached such a duty. The court noted that the Pascarellas’ counsel had expressly stated that the complaint alleged no negligent acts or breach of contract by TI.

The court further held that an agent generally is not liable for the principal’s torts unless the agent engaged in its own wrongful conduct. It also held that an agent who makes a contract for a disclosed principal generally is not personally bound by that contract absent an agreement or clear evidence that the agent accepted personal liability. Because the Pascarellas had not alleged facts supporting a claim against TI under any legal theory, the court granted TI’s motion to dismiss for failure to state a claim.

Disposition

Judge Analisa Torres denied the joint motion to dismiss TI as fraudulently joined. The court granted SRI’s and SRB’s motions to dismiss for lack of personal jurisdiction and granted TI’s motion to dismiss for failure to state a claim. The clerk was directed to terminate the listed motions and close the case.