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This case had its genesis in the alleged encounter between Paula Corbin Jones and then-.2Governor William Jefferson Clinton at the Excelsior Hotel in Little Rock, Arkansas on May8, 1991. On May 6, 1994, Ms. Jones filed suit against Mr. Clinton in the United StatesDistrict Court for the Eastern District of Arkansas, alleging, inter alia, that he had madeinappropriate sexual advances towards her in the hotel room and that, upon learning of the suitapproximately three years after that encounter, the President had made false and defamatorystatements regarding Ms. Jones’ character and veracity. Mr. Clinton responded to the suit byasking that all proceedings be stayed until after the expiration of his term as President, but theSupreme Court held that he was not entitled to such a stay. Clinton v. Jones, 520 U.S. 681(1997). The trial court subsequently granted the President’s motion for summary judgment,Jones v. Clinton, 990 F. Supp. 657 (E.D. Ark. 1998), but the case was ultimately settled whileMs. Jones’ appeal was pending. See Jones v. Clinton, 161 F.3d 528 (8th Cir. 1998). The present litigation concerns the applicability to the Jones suit of a liability insurancepolicy issued to Mr. Clinton in 1992 by State Farm Fire and Casualty Company (State FarmFire). The policy provides coverage, inter alia, for personal injury caused by the insured’s”libel, slander or defamation of character,” but excludes coverage for damages the insured isrequired to pay if the insured acted “with the specific intent to cause harm or injury.” Thepolicy also excludes coverage for “any loss caused by illegal discrimination.” In June 1995,the President’s attorney, Robert S. Bennett, Esquire, requested State Farm Fire to determinewhether the policy provided coverage to the President in connection with Ms. Jones’ action.State Farm Fire responded affirmatively to Mr. Bennett’s inquiry and provided reimbursementfor certain expenses incurred in the defense of the Jones litigation. According to the complaint in this case, the plaintiff, Thomas V. Flocco, is the holderof a personal liability insurance policy issued to him by State Farm Fire. Mr. Flocco hasbrought this suit against three categories of defendants: 1. State Farm Mutual Automobile Insurance Company (State Farm Mutual), which isthe parent company of State Farm Fire, and which owns all of State Farm Fire’s stock; 2. Edward Rust and Vincent Trosino, who are alleged to be directors and high-rankingofficers of State Farm Fire and of State Farm Mutual; and 3. President Clinton and his attorney, Robert S. Bennett. State Farm Fire was not joined as a defendant and is not a party to the case. Characterizing his suit as a “policyholder’s derivative action,” [FOOTNOTE 1] Flocco claims insubstance that Ms. Jones’ allegations against President Clinton did not fall within the coverageof the President’s policy. Flocco further alleges, on information and belief, that all of thedefendants knew that this was so, but that Rust and Trosino nevertheless authorized the paymentof more than $1,100,000 in State Farm Mutual’s funds to reimburse President Clinton and Mr.Bennett for expenses incurred or to be incurred in defending the President against Ms. Jones’suit. Flocco asserts that the conduct of defendants Rust and Trosino constituted a waste ofcorporate assets. He also alleges that the individual defendants converted money belongingto State Farm Mutual to the use and benefit of defendants Clinton and Bennett; Rust andTrosino are alleged to have participated in this conversion by causing the money to bewrongfully paid, and Clinton and Bennett are said to have converted the money by accepting.4it notwithstanding their alleged knowledge that they had no right to receive it. All of the defendants filed pretrial motions to dismiss the complaint. On December 17,1997, the trial judge issued a 23-page written order disposing of the case. The judge dismissedthe plaintiff’s claims against State Farm Mutual without prejudice. The judge noted that Floccohad not made a pre-suit demand for remedial action by the directors either of State FarmMutual or of State Farm Fire. The judge further noted that Flocco had failed to join State FarmFire as a defendant in the action, and that State Farm Fire was an indispensable party. The judgeconcluded that these omissions precluded Flocco from maintaining a policyholder’s derivativeaction against State Farm Mutual. The judge dismissed, with prejudice, Mr. Flocco’s claimsagainst President Clinton and Mr. Bennett, holding as a matter of law that the conduct of thesedefendants, as described in the complaint, did not constitute conversion of State Farm Mutual’sproperty. Finally, the judge dismissed, also with prejudice, Flocco’s claims against defendantsRust and Trosino, holding that the court lacked personal jurisdiction over these defendantsunder the District’s long-arm statute. Flocco now asks this court to reverse the decision of the trial court and to order thereinstatement of his claims against all defendants. With respect to Rust and Trosino, weconclude that the dismissal of the action should have been with prejudice as to furtherproceedings in the District of Columbia but without prejudice as to proceedings in a forumwith personal jurisdiction over these defendants. In all other respects, and especially in lightof events that have transpired since the entry of the trial judge’s decision, we affirm. II. THE VIABILITY OF FLOCCO’S DERIVATIVE ACTION A. The procedural issues. On appeal, Flocco asserts essentially that he has complied with all prerequisites to theinstitution of his action, that any defects could readily have been cured by amendment of hispleading, and that the trial judge erred in dismissing the action. The defendants respond thatFlocco was not entitled to maintain this derivative action because, assuming that such a suitmay be brought by a policyholder at all, [FOOTNOTE 2] Flocco has failed to comply with two essentialprocedural prerequisites. First, the defendants claim that Flocco was required, as aprecondition to maintaining a derivative action, to make a demand for remedial action on thedirectors both of State Farm Mutual and of State Farm Fire. The defendants assert that Floccofailed to make the requisite demand on either company before instituting his action; thatalthough Flocco alleged in his complaint that a demand on State Farm Mutual would have beenfutile, this allegation was insufficient as a matter of law; that, in any event, Flocco waived hisclaim of futility, after the entry of the trial court’s order, by making demands both on StateFarm Fire and on State Farm Mutual; and that for all of these reasons, the suit cannot bemaintained. Second, the defendants contend that State Farm Fire was an indispensable party to Flocco’s action, that Flocco failed to join State Farm Fire as a defendant, and that the casetherefore cannot proceed. We address these contentions in turn. B. Choice of law. Both State Farm Mutual and State Farm Fire are companies organized under the lawsof the State of Illinois. The trial judge held, and we agree, that under the District’s choice-of-lawrules, the viability of Flocco’s derivative action must therefore be determined byapplication of Illinois law. See Labovitz v. The Washington Times Corp., 900 F. Supp. 500,503 (D.D.C. 1995), aff’d, 335 U.S. App. D.C. 296, 172 F.3d 897 (1999); cf. Cohen v.Beneficial Indus. Loan Corp., 337 U.S. 541, 548-49 (1949) (in derivative actions, thequestion whether a stockholder has standing to sue on behalf of the corporation is controlledby the law of the state of organization).C. The demand requirement, futility, and waiver. “The directors of a corporation and not its shareholders [FOOTNOTE 3] manage the business and affairsof the corporation.” Levine v. Smith, 591 A.2d 194, 200 (Del. 1991). In a derivative action,the shareholder seeks to assert, on behalf of the corporation, a claim belonging not to him butto the corporation. Id. “The right of a stockholder to file a bill to litigate corporate rights is,therefore, solely for the purpose of preventing injustice where it is apparent that materialcorporate rights would not otherwise be protected.” Zapata Corp. v. Maldonado, 430 A.2d779, 784 (Del. 1981) (quoting Sohland v. Baker, 141 A. 277, 282 (Del. 1927)). “The decision to bring a law suit or to refrain from litigating a claim on behalf of acorporation is a decision concerning the management of the corporation.” Levine, supra, 591A.2d at 200 (quoting Spiegel v. Buntrock, 571 A.2d 767, 773 (Del. Super. Ct. 1990)).Accordingly, “[b]efore a stockholder should be permitted to bring suit . . . he should show tothe satisfaction of the court that he has exhausted all of the means within his reach to obtainwithin the corporation itself the redress of his grievances or action in conformity [with] hiswishes.” Scalzo v. Commercial Trust & Sav. Bank, 239 Ill. App. 330, 338 (1925).Specifically, the stockholder must either 1. allege that he has made a demand upon the directors of the corporationrequesting that they seek the relief that he proposes to obtain through hisderivative action, and that the directors have wrongfully refused his demand; or 2. allege facts showing that such a demand would be futile because the directorsare not disinterested or did not validly exercise their business judgment. See 805 ILL. COMP. STAT. 5/7.80 (b) (200); [FOOTNOTE 4] Miller v. Thomas, 656 N.E.2d 89, 93-96 (Ill. App.Ct. 1995); Powell v. Gant, 556 N.E.2d 1241, 1244-45 (Ill. App. Ct.), appeal denied, 564N.E.2d 847 (Ill. 1990); cf. Super. Ct. Civ. R. 23.1. [FOOTNOTE 5] To permit the shareholder to represent thecorporation without making a demand or showing futility would eviscerate the “right of thecorporate directory to corporate control.” Delaware & Hudson Co. v. Albany SusquehannaR.R. Co., 213 U.S. 435, 446-47 (1909). In the present case, it is undisputed that prior to the institution of his action, Floccofailed to make a demand on the board of directors either of State Farm Mutual or of State FarmFire regarding the possible institution of proceedings by either company to secure the returnof moneys paid to President Clinton or to his attorney in connection with the Jones litigation.Flocco alleged in his complaint, however, that such a demand upon State Farm Mutual wouldhave been futile, because, inter alia, State Farm Mutual had issued a press release in which ithad characterized Flocco’s claim as “absurd” and as wholly lacking in merit. State Farm Mutualchallenged the sufficiency of this allegation, and the trial judge held that Flocco had notsatisfied the applicable requirements of Illinois law. [FOOTNOTE 6] On appeal, Flocco asks us to hold as a matter of law that a demand would have beenfutile and that the complaint against State Farm Mutual, which the trial judge dismissed withoutprejudice, should be reinstated. But whatever merit, if any, Flocco’s claim of futility may havehad at the time Flocco initially asserted it, Flocco has undermined his own position andinadvertently scuttled his own claim by his actions since the entry of the trial judge’s order.Specifically, in his brief on appeal, Flocco’s attorney advised the court that “Floccosubsequently made a demand to State Farm Mutual and State Farm Fire and that demand wasrejected.” [FOOTNOTE 7] This representation is fatal as a matter of law to Flocco’s position in the trial courtand on appeal. By making his post-order demands on the boards of directors of State Farm Mutual andState Farm Fire, Flocco substantially altered the legal landscape, [FOOTNOTE 8] conceded the independenceof a majority of the board of directors of each corporation, Levine, supra, 591 A.2d at 212,and waived his claim of futility. “Under the law of Delaware and the States that follow its lead,a shareholder who makes demand may not later assert that demand was in fact excused asfutile.” Miller, supra, 656 N.E.2d at 96-97 (quoting Kamen v. Kemper Fin. Servs., Inc., 500U.S. 90, 103 (1991)); see also Spiegel, supra, 571 A.2d at 775. In Miller, the Illinois Courtof Appeals went on to state: We see no reason to deviate from Delaware’s standard, as thisrule makes a great deal of sense from an efficiency standpoint.It would be a waste of time and resources to allow a shareholderto make a demand and have the claim investigated by thecompany, only to allow the shareholder to declare theinvestigation meaningless when unhappy with the results.656 N.E.2d at 97.Having grounded his derivative action on an allegation that a demand would have beenfutile, and having subsequently taken post-order actions by which he waived this claim byoperation of law, Flocco has effectively conceded that he cannot prove an indispensableelement of his derivative action. See, e.g., Bazata v. National Ins. Co. of Washington, 400A.2d 313, 316 (D.C. 1979) (holding that, for purposes of Super. Ct. Civ. R. 41 (b), demand isnot jurisdictional, but is an element of the shareholder’s claim). This defect is fatal to hiscomplaint as written and requires dismissal of the action against all defendants. [FOOTNOTE 9] D. Flocco’s failure to join State Farm Fire. (1) The requirements of Illinois law. As we have previously noted, Flocco failed to make a demand on State Farm Fire priorto the institution of this action. He likewise made no allegation of futility with respect toState Farm Fire, and he failed to join State Farm Fire as a party defendant. We agree with thetrial judge that these failures on Flocco’s part also require dismissal of his complaint.The Supreme Court of Illinois has stated that a derivative suit is “a device to protectshareholders against abuse by the corporation, its officers and directors, and is a vehicle toinsure corporate accountability.” Brown v. Tenney, 532 N.E.2d 230, 232 (Ill. 1988). In atraditional derivative action, a shareholder seeks to assert the rights of the corporation in whichhe or she holds stock. Id. at 232-33. Illinois also recognizes a “double derivative action,” inwhich the shareholder of a parent company sues on behalf of the parent and its wholly-ownedsubsidiary to address the alleged misuse of the subsidiary’s assets. Id. at 233. The reason forthe existence of this form of action is apparent: “A shareholder in a holding company cannotmaintain a classic single derivative action against the subsidiary because he or she will not,technically, meet the threshold share-ownership requirement to bring a derivative actionagainst the subsidiary.” Id. Thus,in order for plaintiffs to have standing to bring [a doublederivative claim] against defendants, plaintiffs must be (1)shareholders of record in a holding company, (2) suing on behalfof a subsidiary controlled or dominated by the holding company,and (3) bringing the action after demand is made to and rejectedby both the subsidiary and holding company.Powell, supra, 556 N.E.2d at 1244. In the present case, the trial judge faithfully applied the requirements of Illinois law tothe complaint before him, as follows: Assuming that as a State Farm Fire policyholder, [Flocco] wouldbe entitled under Illinois law to bring a single-derivative suitagainst State Farm Fire, he has chosen not to do so. Instead,plaintiff has sued State Farm Mutual and his action must beanalyzed solely as a double-derivative suit, and must meetapplicable pleading requirements for such an action.Under Illinois law, it is clear that in a double-derivativelawsuit both the parent and the subsidiary must be made parties tothe action. As pointed out in Brown v. Tenney, [supra,] “theinjured subsidiary, being the real party in interest, must be madea party to the double derivative action as a defendant,” [532N.E.2d] at 234, because the purpose of the double-derivativeaction is to redress an injury suffered by the subsidiary. Here,plaintiff rather unspecifically alleges that the assets of State FarmMutual were converted and wasted, and leaves for the reader toinfer that it must be the policyholders of State Farm Fire thatwere so mistreated because it was State Farm Fire that paid theClinton claim. Thus, the injury is that of the subsidiary and, underBrown, the subsidiary must be a party to the action.(Footnote omitted.) We agree entirely with the judge’s analysis. (2) “Piercing the corporate veil.” Flocco argues that State Farm Fire was not an indispensable party because “State FarmMutual’s own admissions demonstrate that State Farm Mutual and State Farm Fire are one andthe same, at least for purposes of the actions complained about in this case.” Flocco is thusasking this court — an appellate tribunal — to pierce the corporate veil and to declare theseparate corporate existence of State Farm Fire to be a sham. [FOOTNOTE 10] For several reasons, Flocco’sposition cannot prevail. First, as the plaintiff in a double derivative action, Flocco purports to be acting in theinterest of his insurer, State Farm Fire, and he therefore possesses only those rights that StateFarm Fire would have had if State Farm Fire had filed suit on its own behalf. See, e.g., DailyIncome Fund v. Fox, 464 U.S. 523, 528 (1984). But a corporation may not pierce its own veilbecause to do so “would have the effect of denying the corporation its own corporateexistence.” In re Rehabilitation of Centaur Ins. Co., 632 N.E.2d 1015, 1018 (Ill. 1994)(internal quotation marks omitted). As one who claims to be acting on behalf of State FarmMutual and State Farm Fire, Flocco is barred from arguing that the two companies should beviewed as a single entity. Second, “a party seeking to pierce the corporate veil has the burden to make asubstantial showing that the corporation is really a dummy or sham for another dominating.15entity.” Jacobson v. Buffalo Rock Shooters Supply, Inc., 664 N.E.2d 328, 331 (Ill. App. Ct.),appeal denied, 671 N.E.2d 732 (Ill. 1996). Flocco’s complaint does not contain allegationswhich, if true, would permit the court to find that State Farm Fire is a dummy or a sham. Thefact that State Farm Fire is the wholly owned subsidiary of State Farm Mutual does not providea sufficient basis for such a finding. “Dominant stock ownership alone does not create anidentity of interest as an alter ego.” Hills of Palos Condominium Ass’n v. I-Del, Inc., 626N.E.2d 1311, 1333 (Ill. App. Ct. 1993), appeal denied, 631 N.E.2d 708 (Ill. 1994). On thecontrary, “courts look not to a single factor but consider a number of variables such asinadequate capitalization, failure to observe corporate formalities, the commingling of funds,and the absence of corporate records.” Melko v. Dionisio, 580 N.E.2d 586, 595 (Ill. App. Ct.1991). Flocco has failed to allege that State Farm Fire was inadequately capitalized, that itfailed to elect officers or directors or to hold board meetings, that its funds have beencommingled with those of State Farm Mutual, or that its corporate records have not beenseparately maintained. Finally, Flocco is effectively requesting an appellate finding on the “corporate veil”issue, but he has made no allegation on the subject in his complaint. No discovery on thesubject has been conducted or requested, and no evidentiary record has been developed. In oneof his post-argument submissions, Flocco has acknowledged the obvious: “In the instant case,there remains confusion as to the precise status of State Farm Fire and its relationship to StateFarm Mutual, the parent.” An appellate court cannot disregard a defendant’s corporate form onthe basis of such a record, and Flocco is not entitled to proceed with the case where hiscomplaint is barren of the requisite allegations. (3) Leave to amend. In a footnote to his opposition in the trial court to State Farm’s motion to dismiss,Flocco stated that he would be “willing to” add State Farm Fire as a defendant if the courtconcluded that it was necessary for him to do so. Flocco now contends that the trial judgeabused his discretion by “denying” him leave to amend his complaint.This contention is unpersuasive. The trial judge dismissed the complaint as to StateFarm Mutual without prejudice. Flocco was thus free to file a new complaint joining StateFarm Fire, and he could thus attempt to cure any other deficiencies in his original complaint.Instead, Flocco chose to stand on his pleading and to take an immediate appeal. Under thesecircumstances, he is in no position to complain, and there was no error. See, e.g., Kowal v.MCI Communications Corp., 305 U.S. App. D.C. 60, 69, 16 F.3d 1271, 1280 (1994);Watwood v. Credit Bureau, Inc., 68 A.2d 905, 906 (D.C. 1949); cf. Boland v. Engle, 113 F.3d706, 715 (7th Cir. 1997); see also note 18, infra, and associated text. [FOOTNOTE 11] III. THE DISMISSALS WITH PREJUDICE Having failed to satisfy the prerequisites for maintaining a derivative action, Floccowas not entitled to sue on behalf of State Farm Mutual, and his complaint therefore could notstand against any defendant. The trial judge held that dismissal on these grounds must bewithout prejudice. No party has challenged this determination, [FOOTNOTE 12] and we agree that it wascorrect. Our affirmance of the dismissal of the complaint without prejudice on the foregoinggrounds does not, however, complete our task. The trial judge dismissed the action againstPresident Clinton and Mr. Bennett with prejudice on the grounds that, as to these defendants,the complaint failed to state a claim upon which relief may be granted. The judge alsodismissed the complaint with prejudice against defendants Rust and Trosino because, in his view, these defendants were not amenable to suit in the District of Columbia in connectionwith the transactions alleged in the complaint. Flocco contends that these rulings wereerroneous, and we must therefore decide whether the claims against Clinton, Bennett, Rust,and Trosino were properly dismissed with (rather than without) prejudice. A. The claim against Clinton and Bennett. In Count I of his complaint, Flocco alleged, on information and belief, that defendantsClinton and Bennett, “acting in concert” with Rust and Trosino, used President Clinton’s policywith State Farm Fire “as a pretext” for the “unlawful conversion of approximately . . .$1,100,000 of State Farm Funds to the use and benefit of William J. Clinton, and have deprivedState Farm of that sum.” According to Flocco, each of the defendants “unlawfully exercisedownership, dominion or control over State Farm funds.” Flocco alleged that Rust and Trosino”have done so by authorizing payments of State Farm funds for the benefit of Mr. Clinton eventhough State Farm had no legal duty to make such payments,” [FOOTNOTE 13] and that Clinton and Bennett”have done so by receiving and retaining these funds, or the benefit thereof.” Finally, Floccoasserted, on information and belief, that Clinton and Bennett, as well as Rust and Trosino, wereall aware that “there [was] no ground whatever for any claim that State Farm had any duty todefend Mr. Clinton against Ms. Jones’ suit.” The trial judge dismissed Count I, holding that Flocco had failed in that count to state.19a claim upon which relief could be granted. Citing Washington v. John T. Rhines Co., 646A.2d 345, 346 n.1 (D.C. 1994), the judge recognized that “[i]n deciding a motion to dismisspursuant to [Super. Ct. Civ. R.] 12 (b)(6), the complaint is read in the light most favorable tothe claimant and the factual allegations are accepted as true.” Nevertheless, the judgeconcluded that “on these facts, no relief can be granted for a derivative claim in conversion.”The judge reasoned as follows: [T]he conversion count must be analyzed as one made by StateFarm Fire for accepting and paying a claim made on behalf of apolicyholder who held a valid policy at the time the claim wasmade. So analyzed, Count I cannot stand. At the time the claimwas made, Clinton owned a valid liability insurance policy issuedby State Farm Fire. Through his attorney, he made a claim on thatpolicy in connection with a lawsuit filed against him. The insurerdetermined to pay the claim, that is, to support the defense of thelawsuit filed against the policyholder. Pursuant to thatdetermination, it transferred certain funds either to Clinton or hisattorney. By filing a derivative action on behalf of either StateFarm Mutual or State Farm Fire against President Clinton and hisattorney, plaintiff is forced into the position of asserting thatState Farm Fire could claim that Clinton and Bennett convertedState Farm Fire funds which State Farm Fire determined shouldbe paid to those defendants. To state the proposition is to refuteit. It cannot logically be that defendants Clinton and Bennettexercised unlawful dominion and control over State Farm Firefunds when State Farm Fire paid those funds to them pursuant toa claim made on a valid State Farm Fire insurance policy.Without unlawful ownership, dominion, or control, there can beno conversion, and Count I must be dismissed. “Conversion has generally been defined as any unlawful exercise of ownership,dominion or control over the personal property of another in denial or repudiation of his rightsthereto.” Chase Manhattan Bank v. Burden, 489 A.2d 494, 495 (D.C. 1985) (quoting Sheav. Fridley, 123 A.2d 358, 361 (D.C. 1956)). In the present case, Flocco claims to have.20sufficiently alleged conversion by asserting first, that Clinton, Bennett, Rust and Trosino allknew that the money in question belonged to State Farm Fire and that Clinton and Bennett hadno right to it, and second, that in spite of their knowledge, the defendants took the funds awayfrom their rightful owner and transferred them to a wrongdoer — President Clinton — whoallegedly had made a knowingly false claim of coverage. But even if conversion could beestablished by proof that Clinton and Bennett knew that the President was not entitled to thefunds — an issue we need not and do not decide — Flocco’s complaint nevertheless fails. Theflaw in Flocco’s argument is that he treats as a fact, known to Clinton and Bennett, theproposition that the policy did not apply, when in reality that proposition turns on anunresolved and somewhat dubious legal theory. The complaint thus alleges that Clinton andBennett knew a fact that, in our view, they could not have known because it is subject togenuine dispute and therefore not knowable. President Clinton’s insurance policy, while excluding claims for discrimination andintentional conduct, [FOOTNOTE 14] obligated State Farm Fire to pay for a “net loss” for personal injury,including libel, slander and defamation of character. Paula Jones’ suit against the Presidentincluded claims of defamation. Under familiar principles of insurance law, “any reasonabledoubt which may arise as to the meaning or intent of a condition of [the policy] will beresolved against the insurer.” Cameron v. USAA Prop. & Cas. Co., 733 A.2d 965, 968 (D.C.1999) (citations omitted); accord, West American Ins. Co. v. Vago, 553 N.E.2d 1181, 1184(Ill. App. Ct.), appeal denied, 561 N.E.2d 710 (Ill. 1990) (“The insurer must defend its insuredif the complaint alleges facts which are within or potentially within policy coverage . . . . Theduty to defend exists even if the complaint alleges several causes of action and only one is.21within potential policy coverage.”) (citations omitted). In Stanback v. Westchester Fire Ins. Co., 314 S.E.2d 775 (N.C. Ct. App. 1984), theinsured’s umbrella policy provided coverage for suits against the insured for personal injury,including, inter alia, malicious prosecution and intentional infliction of emotional distress.The policy contained an exclusion for “any act committed by . . . the insured with intent tocause personal injury or property damage.” Id. at 778. The insured had been sued by his wifefor inflicting mental anguish and for maliciously instituting a lawsuit against her withoutprobable cause. The insurer denied coverage to the plaintiff, citing the exclusion for actionsfor injury resulting from intentional acts. The court ruled in favor of the insured:In this case the policy defined “personal injury” to includefalse arrest, false imprisonment, wrongful eviction, wrongfuldetention, malicious prosecution, libel and slander. These areclearly intentional torts. This definition when read in conjunctionwith exclusion (e), which purportedly attempts to excludeintentional torts, creates an ambiguity in the policy. Our supremecourt has held that when language is used in an insurance policywhich is reasonably susceptible of differing constructions, itmust be given the construction most favorable to the insured,since the insurance company prepared the policy and chose thelanguage. See Grant v. Insurance Co., 295 N.C. 39, 243 S.E.2d894 (1978). In this case the apparent conflict between coverageand exclusion must therefore be resolved in favor of plaintiff, andwe therefore reject defendants’s argument that Mrs. Stanback’sallegations regarding intentional infliction of mental anguish andmalicious prosecution are excluded from coverage by exclusion(e). Id. at 779; see also Scudder v. Hanover Ins. Co., 559 N.E.2d 559, 562 (Ill. App. Ct. 1990)(“[U]nder Illinois law, policy provisions excluding coverage for acts committed by the insuredwith intent to cause personal injury will only exclude coverage if the insured acted withspecific intent to injure, unless the policy states otherwise.”); Burns v. Middlesex Ins. Co., 558 A.2d 701, 702 (Me. 1989) (exclusion from coverage of “bodily injury . . . which isexpected or intended by the insured” did not negate insurer’s duty to defend suit against insuredfor defamation, invasion of privacy, and intentional infliction of emotional distress; exclusionapplies only where insured subjectively wanted to cause bodily injury and subjectively foresawit as practically certain; “[i]f there is any legal or factual basis that could be developed at trial,which would obligate the insurer to pay under the policy, the insured is entitled to a defense”)(emphasis in original) (citation omitted); but cf. Commercial Union Ins. Co. v. Sky, Inc., 810F. Supp. 249, 254-55 (W.D. Ark. 1992) (no duty to defend defamation claims made ininsured’s brief, where those claims arose out of the underlying non-covered claim of sexualharassment). [FOOTNOTE 15] The question whether, as Flocco alleges, President Clinton and Mr. Bennett knew thatthe policy did not apply to Ms. Jones’ action must be analyzed with the foregoing principlesin mind. In our view, Flocco’s critical allegation cannot be reconciled with the authorities wehave cited. Indeed, Flocco’s own submission to the trial court demonstrates that Clinton andBennett could not have known what Flocco alleges that they knew. As a part of thatsubmission, Flocco’s attorney included a copy of Symposium: Is the President gettingspecial insurance treatment for the Paula Jones lawsuit?, Insight, July 21, 1997, at 24-27.This symposium contains what is in effect a debate between two insurance experts who reachedopposite conclusions on the issue. Richard Giller, a Los Angeles insurance lawyer, argued asfollows: Neither Pacific Indemnity nor State Farm legally are [sic]obliged to provide the president with a defense in the Jones case,based upon the nature of the allegations of Jones’ complaint, theterms and conditions of the two policies, applicable case law andthe strong public policy against allowing people accused ofsexual wrongdoing to pass off their liability to insurancecompanies. So why would Pacific Indemnity or State Farm agree toshare in the million-dollar cost of defense — a figure that coulddouble or triple quickly? At least to this expert, the answer issimple and straightforward: because their policyholder is thePresident of the United States. If you or I were accused of thesame wrongdoing of which Jones has accused the President,neither company would have lifted a finger to assist us.In Mr. Giller’s view, Ms. Jones’ defamation claim, like the other counts in her complaint, wasbased on “intentional misconduct” on the part of President Clinton, and it therefore fell outsidethe scope of the President’s policy with State Farm Fire. [FOOTNOTE 16] Id. at 24. But Sean Mooney, a senior vice president and economist at the Insurance InformationInstitute, was of a different opinion: The first issue — whether policies held by the presidentwould provide coverage — is relatively easy to answer. They do.The president purchased umbrella liability policies from twodifferent insurance companies. These policies provide coveragefor any personal injury for which a covered person legally isresponsible. The policy defines personal injury to include mentalanguish and injury, false arrest, false imprisonment, humiliation,libel, slander and defamation of character. As long as acts suchas these were alleged in the Jones lawsuit the insurance companynormally will provide coverage. Specifically, the lawsuit alleged false imprisonment and.24defamation of character, and the insurance companies providedcoverage against these claims. They were not responding to thesexual-harassment charge. Indeed, one of the policies excludesacts of sexual harassment. * * * * There is one exclusion in the umbrella insurance policythat is particularly relevant to the Jones lawsuit: the exclusionfor intentional acts. The policy excludes an act committed ordirected by a covered person with intent to cause personal injury.If the lawsuit alleges that the act was intended to cause injury,then this exclusion would apply. But if the lawsuit is silent onintent or equivocal, then insurance companies, in most cases, willbelieve they have an obligation to defend. Id. at 25. We find it unnecessary to determine whether Mr. Giller or Mr. Mooney has the betterof the argument. The very existence of an evidently bona fide dispute regarding coveragebetween two specialists in the field refutes Flocco’s purportedly factual assertion that Clintonand Bennett knew that Ms. Jones’ claim was not covered. In assessing Flocco’s allegations, it is our obligation to “pierce through the pleadingsand their adroit craftsmanship to get at the substance of the claim.” United Nat’l Ins. Co. v.Tunnel, Inc., 988 F.2d 351, 354 (2d Cir. 1993). “While, for the purpose of a motion todismiss, facts well pleaded must be taken as true, unsupported conclusions of the pleader maybe disregarded.” Oppenheim v. Sterling, 368 F.2d 516, 519 (10th Cir. 1966), cert. denied,386 U.S. 1011 (1967). “We should not accept as true allegations that are in conflict with factsjudicially known to the court.” Blackburn v. Fisk Univ., 443 F.2d 121, 123 (6th Cir. 1971).Because we know judicially that the dispute over coverage presents an unsettled question oflaw, we need not, and indeed cannot, credit Flocco’s allegation in Count I that Clinton and.25 Bennett knew that they were not entitled to the money paid to them by State Farm Fire.Stripped of this critical allegation, the claims against the President and his attorney failto state a claim upon which relief may be granted. If, as we have concluded, the question ofcoverage was in doubt, then defendants Clinton and Bennett had the right to file a claim underthe policy. We agree with the trial judge that the subsequent acceptance by these defendantsof money which State Farm Fire voluntarily turned over to them in response to that claim couldnot constitute conversion, regardless of Flocco’s criticism of the amount paid. Flocco asserts that even if Count I failed to state a claim for conversion, he should havebeen permitted to amend his complaint to allege some other tort. [FOOTNOTE 17] But even if we were toassume that Flocco has preserved this point for appeal — a dubious assumption [FOOTNOTE 18] — he hasfailed to identify in any of his numerous filings a claim in tort which he could have filed in thename of State Farm Fire and which could have survived the excision from his complaint of theallegation that Clinton and Bennett knew that they were not entitled to coverage. We likewiseknow of no such tort. Accordingly, we conclude that the trial judge did not err by dismissing Count I with prejudice B. The claims against Rust and Trosino. Finally, the trial judge dismissed with prejudice Count II of the complaint, whichcontained Flocco’s claims against Rust and Trosino, for lack of personal jurisdiction over thesedefendants. Flocco contends that this dismissal was erroneous. He claims that Rust andTrosino were properly subject to the court’s jurisdiction pursuant to the District’s long- armstatute. See D.C. Code � 13-423 (a)(1) (1995). We do not agree.At the times relevant to this appeal, Rust was the Chief Executive Officer (CEO) ofState Farm Mutual. He was also President and CEO of State Farm Fire and a director of thatcorporation. Trosino was a Vice Chairman of State Farm Mutual and a Vice President andDirector of State Farm Fire. Both men were residents of Illinois. Flocco alleged in his complaint that Rust and Trosino sent agents to the District ofColumbia to meet with defendant Bennett regarding President Clinton’s claim under his StateFarm Fire policy. Flocco further asserted that these defendants ordered the payment toClinton and Bennett, in the District of Columbia, of funds belonging to State Farm Fire. [FOOTNOTE 19] According to Flocco, the foregoing allegations were sufficient to confer personal jurisdictionon the Superior Court, not only over State Farm Mutual, but over Rust and Trosino as well.The trial judge held that these averments were insufficient. After noting the absence.27from the complaint of any allegation that Rust or Trosino had personally come to the Districtin connection with the transactions here at issue, the judge wrote: This court may exercise “personal jurisdiction over aperson, who acts directly or by an agent, as to a claim for reliefarising from the person’s . . . (1) transacting any business in theDistrict of Columbia.” D.C. Code � 13-423 (a)(1) (1995 Repl.).When long-arm jurisdiction is based on transacting business inthe District, only acts within the District related to thetransaction of business can form the basis for personaljurisdiction. D.C. Code � 13-423 (b); Trerotola v. Cotter, 601A.2d 60, 63 (D.C. 1991). Thus, any contacts of Rust and Trosinowith the District of Columbia unrelated to the transactionscomplained of by plaintiff are irrelevant. It seems clear that even if defendants Rust and Trosino hadthe kind of personal involvement in the decision to reimburse partof President Clinton’s cost of defense of the Jones action allegedin the complaint, which they have denied, that involvement wouldsupport the exercise of personal jurisdiction over the companyfor its transaction of business in the District pursuant to the long-armstatute, but would not confer personal jurisdiction on theseindividual defendants sued in their individual capacities. Whenthere are no allegations that a nonresident defendant’s contactswith a jurisdiction were for the purpose of transacting businessas an individual, but rather were only to perpetuate a corporation’sbusiness, that defendant cannot be sued individually under the”transacting business” prong of the long-arm statute. Quinto v.Legal Times of Washington, Inc., 506 F. Supp. 554, 558 (D.D.C.1981); see also Wiggins v. Equifax Inc., 853 F. Supp. 500, 503(D.D.C. 1994). We have held, and Rust and Trosino concede, that the “transacting any business”provision of our long-arm statute extends as far as the Fifth Amendment’s Due Process Clausepermits. See, e.g., Shoppers Food Warehouse v. Moreno, 746 A.2d 320, 325 (D.C. 2000)(en banc). “[P]ersonal jurisdiction [therefore] exists when the defendant has purposelyestablished minimum contacts with the forum state and when the exercise of jurisdictioncomports with ‘traditional notions of fair play and substantial justice.’” Wiggins, supra, 853.28F. Supp. at 502 (quoting Asahi Metal Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 113(1987)). “The critical [question] is whether the nonresident’s ‘conduct and connection with theforum state are such that he [or she] should reasonably anticipate being haled into court there.’”Trerotola v. Cotter, 601 A.2d 60, 64 (D.C. 1991) (quoting World-Wide Volkswagen Corp.v. Woodson, 444 U.S. 286, 297 (1980)); see also Shoppers Food Warehouse, supra, 746A.2d at 331. In the present case, we conclude that this question must be answered in thenegative. We do not doubt that if the well-pleaded allegations of the complaint are taken as true,then the trial court had personal jurisdiction over State Farm Mutual. Butjurisdiction over an employee does not automatically followfrom jurisdiction over the corporation which employs him . . . .Each defendant’s contacts with the forum State must be assessedindividually . . . . The requirements of International Shoe [Co.v. Washington, 326 U.S. 310 (1945)] must be met as to eachdefendant over whom a state court exercises jurisdiction.Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 781 n.13 (1984) (citations and internalbrackets omitted). The present case is similar in dispositive respects to Wiggins, supra. In Wiggins, theplaintiff asked the court to exercise personal jurisdiction over Lowitz and Shaw, each of whomwas a supervisor in the corporate defendant’s office in McLean, Virginia. According to theplaintiff, the two nonresident supervisors directed and supervised subordinate employees whohad engaged in the District of Columbia in activities prohibited by the federal Fair CreditReporting Act and by RICO. The court held that the allegations of the complaint were insufficient under the Due Process Clause to confer jurisdiction over the supervisors. 853F. Supp. at 502. The court continued: [A] court does not have jurisdiction over individual officers andemployees of a corporation just because the court hasjurisdiction over the corporation. See Quinto v. Legal Times, 506 F. Supp. 554, 558 (D.D.C. 1981). Personal jurisdiction overthe employees or officers of a corporation in their individualcapacities must be based on their personal contacts with theforum and not their acts and contacts carried out solely in acorporate capacity. Thus, the corporation ordinarily [FOOTNOTE 20] insulates the individual employee from the court’s personal jurisdiction.In this case, defendants are clearly not “doing business”within the District of Columbia. They are merely employees ofa company that has contacts with the District. These acts, carriedout within the scope of their employment, do not createsufficient contacts to establish personal jurisdiction. The factthat Lowitz and Shaw may have acted in a supervisory capacityover persons with contacts with the District also fails to createpersonal jurisdiction. Id. at 503 (emphasis in original; footnote omitted). Flocco asserts that Rust and Trosino directed their subordinates to carry out activitiescontrary to the interests of State Farm Mutual, that these directives were personal rather thancorporate in nature, and that the trial judge therefore should have exercised personal.30jurisdiction over these defendants. This contention is unpersuasive. In Richard v. Bell Atl.Corp., 976 F. Supp. 40 (D.D.C. 1997), the plaintiff in an action for employment discriminationalleged that three individual defendants, who were high-ranking officers of Bell AtlanticCorporation, but who did not reside in the District of Columbia, had intentionally directedsubordinates to engage in a variety of activities which resulted in racial discrimination in theDistrict against Bell Atlantic’s black employees. The court held that, for jurisdictionalpurposes, notwithstanding the unlawful nature of their alleged conduct, the individualdefendants’ activities were performed in their capacity as corporate officers, and that in lightof Keeton and other authorities, the court lacked personal jurisdiction over the nonresidentdefendants: All of these alleged jurisdictional facts involve theindividual defendants’ official duties for Bell AtlanticCorporation — setting policies, communicating with employees,conducting investigations, and making employment decisions. Asa matter of law, the defendants were at all times acting within thescope of their employment, because they were authorized toperform such acts for BAC. Accordingly, the plaintiffs havefailed to plead sufficient jurisdictional facts, because actscommitted within the scope of employment cannot be imputed tothe individual defendants to establish personal jurisdiction overthem. See Keeton, [supra, 465 U.S. at] 781 n.13; Wiggins,[supra,] 853 F. Supp. at 503 (finding no personal jurisdictionover two supervisors at a credit reporting company, because theyacted within the scope of their employment when theypurportedly (a) issued and transmitted the plaintiff’s creditreports to another office and (b) supervised employees whocollected information on the plaintiff). Id. at 50 (footnotes omitted). We agree with the analysis of the courts in Wiggins and Richard. [FOOTNOTE 21] Even if we assume,contrary to their affidavits, that Rust and Trosino dispatched one or more subordinates to theDistrict to negotiate with Mr. Bennett and that these defendants subsequently authorized thewrongful payment to President Clinton and his attorney of money belonging to State Farm Fire,we do not believe that Rust and Trosino could reasonably have anticipated being haled intocourt in the District, as individual defendants, to answer a suit such as Flocco’s. Indeed, ifFlocco’s argument were accepted, it would be difficult to envision a reasonable limitingprinciple which would preclude the exercise of jurisdiction over each and every officer ofState Farm Mutual and State Farm Fire, even if that individual has never set foot in the Districtof Columbia. Indeed, Flocco’s doctrine would permit the exercise of jurisdiction even overnonresident officers of multi-national corporations located in jurisdictions many thousandsof miles from the United States, whenever a plaintiff has made conclusory allegations, oninformation and belief, that such persons have directed or supervised activities of subordinateswho have taken some action in the District. Our concern in this regard is compounded byFlocco’s remarkable acknowledgment that he may have sued the wrong individuals, [FOOTNOTE 22] and by hisinsistence that personal jurisdiction over Rust and Trosino exists anyway. Accordingly, we conclude that the claims against Rust and Trosino were properly dismissed. [FOOTNOTE 23] In his written order, the trial judge stated that the action against Rust and Trosino wasdismissed “with prejudice.” Presumably, the judge meant by this terminology that the order ofdismissal was with prejudice to the filing of a new complaint against these defendants in theDistrict of Columbia. In any event,dismissal for want of subject matter or personal jurisdiction isnot a decision on the merits. Consequently, upon such adismissal the plaintiff is free to institute the suit anew in ajurisdiction or under circumstances supporting jurisdiction.Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 507 n.4 (2d Cir. 1994) (citationomitted); see also Velasquez v. Franz, 589 A.2d 143, 147 (N.J. 1991). IV. CONCLUSION For the foregoing reasons, the order dismissing Count II of the complaint withprejudice is modified to reflect that Flocco is not precluded from proceeding against Rust andTrosino in an appropriate forum, provided that he can comply with all of the legal prerequisitesfor maintaining such a derivative suit. In all other respects, the decision of the trial court isaffirmed. :::FOOTNOTES::: FN1 In a subsequent filing, Flocco’s attorney described the suit, more accurately, as a “doublederivative action.” FN2 State Farm Mutual argued in the trial court that Flocco lacked standing to bring the action.State Farm Mutual asserted that Flocco’s action was legally different from a stockholder’sderivative suit, because, according to State Farm Mutual, an insured’s legal relationship to hisinsurer is more analogous to a relationship between a creditor and a debtor than it is to onebetween a stockholder and a corporation. Relying upon Lower v. Lanark Mut. Fire Ins. Co.,502 N.E.2d 838, 840 (Ill. App. 1986), however, the trial judge concluded that under Illinoislaw, “the owner of a valid policy issued by a mutual insurance company has standing to bringa derivative action, not in his own right, but on behalf of the corporation in the same way ashareholder can bring such an action against a corporation.” See also Theodore Allegaert,Comment, Derivative Actions by Policyholders on Behalf of Mutual Insurance Companies,63 U. CHI. L. REV. 1063 (1996). While maintaining its disagreement with the trial judge’sdisposition of this issue, State Farm Mutual has explicitly declined to ask us to reverse thejudge’s ruling on the question of standing. We take the case as it has been presented to us, andwe express no opinion with respect to the viability of a policyholder’s derivative action eitherunder Illinois law or under District of Columbia law. FN3 Or, in this case, its policyholders. FN4 Section 5/7.80 (b) provides in pertinent part: A complaint in a proceeding brought in the right of a corporationmust allege with particularity the demand made, if any, to obtainaction by the directors and either why the complainant could notobtain the action or why he or she did not make the demand. FN5 Rule 23.1, which governs derivative actions by shareholders, and which parallels FED. R.CIV. P. 23.1, provides in pertinent part: The complaint shall also allege with particularity the efforts, ifany, made by the plaintiff to obtain the action the plaintiff desiresfrom the directors or comparable authority and, if necessary,from the shareholders or members, and the reasons for theplaintiff’s failure to obtain the action or for not making the effort. FN6 The judge wrote: Under Illinois law, before instituting a double-derivative action,a plaintiff must make a formal demand on the board of directorsof both the parent and the subsidiary company, or allegesufficiently facts that show such demands would have been futile.Powell[, supra], 556 N.E.2d at 1245. Here, plaintiff made nosuch demand on either board. In his complaint, he explained thatsuch a demand on State Farm Mutual would be futile because ofthe widespread attention that has been paid to the challengedaction and the presumed inability of the directors to changecourse after approving the payments. Personal financial interestsof defendants Rust and Trosino, and other board members, werecited as additional reasons why a pre-suit demand would be futile. He did not address in the complaint why it would have been futileto make the required pre-suit demand on State Farm Fire’s Boardof Directors.In a double-derivative action, Illinois law requires that “aplaintiff shareholder [here, policyholder] must make demandtwice, once of the subsidiary company and once of the holdingcompany . . . . In the alternative, the doctrine of futility excusesdemand on directors when the majority of the directors are thealleged wrongdoers.” Id. (citation omitted). There is noallegation in the complaint that a majority of the directors ofeither State Farm Mutual or State Farm Fire are wrongdoers inconnection with the decision to make the challenged payments.Furthermore, plaintiff has not indicated in the complaint anyattempt to make a formal pre-suit demand on either State FarmMutual or State Farm Fire, and has asserted futility only inconnection with State Farm Mutual. This is a clearly insufficienteffort to comply with the requirements of Illinois law asexpressed in Powell. FN7In informing the court that demands had been made and refused, Flocco’s attorney maderepresentations as to facts outside the record without first filing a motion to supplement therecord. See D.C. App. R. 10 (e); Maldonado v. Maldonado, 631 A.2d 40, 41 n.1 (D.C. 1993)(the court ordinarily will not consider facts outside the record). Moreover, counsel did notprovide a copy of his demand letters, or even specify the date on which they were sent.Counsel did, however, attach as an “addendum” to his brief a copy of a letter to him datedSeptember 28, 1998 from David M. Spector, Esq., counsel for State Farm Mutual and StateFarm Fire. According to Mr. Spector’s letter, the two companies had determined through their”Special Litigation Committees,” on the basis of a “thorough investigation,” that “there is nobasis to pursue a claim against any State Farm representative or third party or take any otheraction arising out of the decision to defend William J. Clinton for a period of time in Jonesv. Clinton.” Although outside the record, it is undisputed that Flocco made post-order demands andthat these demands were rejected. Indeed, in their supplemental submissions, the parties haveextensively discussed the legal consequences of the events that transpired since the trial judgeissued his order. Because these facts were disclosed to the court by Flocco, and because theysignificantly affect the merits of the appeal to the legal detriment of the party who broughtthem to our attention, we are constrained to consider them. See, e.g., Stotland v. GAF Corp.,469 A.2d 421, 422-23 (1983)(discussing effect of a similar post-order demand to a case inwhich the plaintiffs had alleged that a demand would be futile). FN8 It appears from the casual mention of the post-order developments in a footnote toFlocco’s appellate brief that his attorney believed demand and refusal to be simply a proxy for,or indeed proof of, his allegation of futility. Flocco’s counsel seems to have assumed that thelegal posture of the parties following demand and refusal would be the same as that whichwould have existed if Flocco had established his futility claim. But the courts of Illinois, likethose of other jurisdictions, have held that “demand refused and demand excused situationsrequire different standards.” Miller, supra, 656 N.E.2d at 94. The Supreme Court of Delawarehas elaborated upon the distinction: The focus of a complaint alleging wrongful refusal of demand isdifferent from the focus of a complaint alleging demand futility.The legal issues are different; therefore, the legal standardsapplied to the complaints are necessarily different. Ashareholder plaintiff, by making demand upon a board beforefiling suit, “tacitly concedes the independence of a majority ofthe board to respond. Therefore, when a board refuses a demand,the only issues to be examined are the good faith andreasonableness of its investigation.” Spiegel, 571 A.2d at 777.When a shareholder files a derivative suit asserting a claim ofdemand futility, hence demand excused, the basis for such a claimis that the board is (1) interested and not independent; and (2) thatthe transaction attacked is not protected by the business judgmentrule. Aronson [v. Lewis, 473 A.2d 801], 814 [(Del. 1984)]. Incontrast, Levine’s complaint based on wrongful refusal of demandnot only tacitly concedes lack of self-interest and independenceof a majority of the Board, but expressly concedes both issues.Thus, the first part of the Aronson test did not come into play andthe trial court was only required to address the application of thebusiness judgment rule to the Board’s refusal of Levine’s demand.Levine, supra, 591 A.2d at 212. Indeed, “[t]he effect of a demand is to place control of thederivative litigation in the hands of the board of directors.” Spiegel, supra, 571 A.2d at 775.Illinois law is to the same effect. See Miller, supra, 656 N.E.2d at 94-95; Powell, supra, 536N.E.2d at 1245. FN9 The trial judge relied on Flocco’s failure to allege a pretrial demand as a ground fordismissal of the complaint only as to the defendant State Farm Mutual. The judge dismissedthe claims against the individual defendants with prejudice on other grounds, and he thereforedid not reach the question whether dismissal as to those defendants was required as a result ofFlocco’s alleged failure to comply with prerequisites for instituting a derivative action. FN10 Flocco’s attorney frames the argument in this way: “A corporate entity, a fictitiouscreature of the law in the first place, cannot escape liability for its own wrongdoing by creatinga complicated web of other corporate entities.” As counsel for State Farm Mutual correctlypoints out, Flocco, who is purportedly suing on behalf of State Farm Mutual, appears to bemaking arguments directly contrary to the interests of the corporation for whose benefit heclaims to be acting. FN11 Although there is authority to the contrary, see 13 W. FLETCHER, CYCLOPEDIA OF THE LAWOF PRIVATE CORPORATIONS � 5997, at 240 (1995), we conclude that Flocco’s failure to joinState Farm Fire as a defendant did not deprive the court of subject matter jurisdiction over hissubstantive claims in the case. A leading commentator has written:There has long been an impression that dismissal for failure tojoin an indispensable party [under FED. R. CIV. P. 19] is ajurisdictional dismissal. This notion probably gained currencybecause some courts have permitted the defense to be raised forthe first time on appeal [internal cross-reference omitted].However arguable this issue might have been under earlierpractice, it is absolutely clear today that a dismissal on thesegrounds is not jurisdictional. In other words, if a court continuesto judgment in the absence of someone who would have beenfound indispensable, the judgment is not subject to collateralattack4 JAMES WM. MOORE ET AL., MOORE’S FEDERAL PRACTICE � 19.02 [4][C](3d ed. 2000) (footnotesomitted; emphasis in original); accord, 7 C. WRIGHT, A. MILLER & M. KANE, FEDERAL PRACTICEAND PROCEDURE � 1611, pp. 171-73 (2d ed.1986) (footnotes omitted) (“since the indispensableparty doctrine is equitable both in its origin and [its] nature, scholarly commentary as well asthe vast majority of courts reject this ‘jurisdictional’ characterization”). The trial judgetherefore acted within his jurisdiction in addressing, on the merits, the legal effect of Flocco’sfailure to make a demand, and he likewise did not exceed his authority by reaching other non-jurisdictionalissues. FN12 Counsel for defendants Clinton and Bennett argue that Flocco deliberately mooted hisaction by making his post-complaint demands, and that he therefore waived any challenge tothe judge’s dismissal with prejudice of the action against these defendants. See, e.g., U.S.Bancorp Mortg. Co. v. Bonner Mall Partnership, 513 U.S. 18, 24 (1994); National FootballLeague Players Ass’n v. Pro-Football, Inc., 316 U.S. App. D.C. 415, 416-17, 79 F.3d 1215,1216-17 (1996). Because we affirm the dismissal with prejudice on other grounds, we neednot decide this issue. We note, however, that the actions taken by Flocco’s counsel whichrequire the dismissal of the action, i.e., the demands on the corporate boards of directors,which undermined Flocco’s allegation of futility, may not have been taken with the intent tomoot the appeal. Under these circumstances, the remedy proposed by Clinton and Bennett –namely, the preclusion of Flocco from challenging the correctness of the trial judge’ssubstantive rulings — appears unduly harsh for what may have been no more than barristerialoversight. FN13 In his complaint, Flocco also speculated regarding the motives of Rust and Trosino. Healleged, on information and belief, that these defendants “converted State Farm Funds for thepurpose of winning the gratitude and favor of the President of the United States and creatinga favorable regulatory environment for the insurance industry and an unfavorable environmentfor competitor industries.” FN14 The policy provided, inter alia, that “[w]e will not provide insurance . . . for personalinjury . . . which is expected or intended by you . . . .” FN15 Although the factual presentation in Commercial Union is somewhat cryptic, it appearsthat in that case the alleged defamation took place at the same time as, or shortly after, theclaimed sexual harassment. In Jones v. Clinton, on the other hand, the defamation of Ms.Jones’ character is alleged to have occurred several years after the incident at the ExcelsiorHotel. FN16 At the conclusion of his article, Mr. Giller briefly described Flocco’s suit in the SuperiorCourt and stated: “Based on my experience in insurance law, I’d say he may have a case.”Symposium, supra, at 27. FN17 In a footnote to his order that followed his dismissal of the conversion claim, the trialjudge wrote:This is not to say that, given a factual basis and appropriatepleading, other torts, if alleged, could not survive a Rule 12(b)(6)challenge. FN18 Flocco never attempted to amend his complaint in the trial court, either as a matter ofright prior to the judge’s dismissal order, nor by motion thereafter. “[A] bare request in anopposition to a motion to dismiss — without any indication of the particular grounds on whichamendment is sought, cf. FED. R. CIV. P. 7(b) — does not constitute a motion within thecontemplation of Rule 15 (a).” Confederate Mem’l Ass’n v. Hines, 301 U.S. App. D.C. 395,399, 995 F.2d 295, 299 (1993). Accordingly, in light of Hines “it could hardly have been anabuse of discretion for the [Superior] Court not to have afforded [Flocco] such leave suasponte.” Id. FN19 Rust and Trosino filed affidavits in which each denied any role whatever in the decisionto authorize payments to Clinton and Bennett. Each defendant also denied that he had ever hadany substantive communications with either Clinton or Bennett on any subject, or any dealingswith anyone regarding the events described in the complaint. FN20 Given the judge’s italicization of the word “ordinarily” and his earlier invocation of a “dueprocess” analysis, we do not read the Wiggins opinion as articulating a per se rule that anemployee’s acts in his official capacity may never give rise to personal jurisdiction over him.Indeed, we explicitly decline to adopt such an absolute “fiduciary shield” doctrine, which wouldbe difficult to reconcile with Supreme Court precedent and with persuasive case authority fromother courts. See Keeton, supra, 465 U.S. at 781 n.13; Calder v. Jones, 465 U.S. 783, 790(1984) (defendants’ “status as employees does not somehow insulate them from jurisdiction”);Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 903 (2d Cir. 1981); cf. Chase v. Pan-PacificBroadcasting, Inc., 617 F. Supp. 1414, 1422-23 (D.D.C. 1985) (corporate officersubject to personal jurisdiction where, inter alia, he twice came to District of Columbia fordiscussions and allegedly made dispositive decisions there). FN21 See also Cellutech, Inc. v. Centennial Cellular Corp., 871 F. Supp. 46, 49-50 (D.D.C.1994) (nonresident defendants’ correspondence and negotiations with plaintiff’s District ofColumbia attorneys did not give rise to personal jurisdiction over them where “none of theprincipals were involved in negotiations here or were present in the District at any time”;plaintiff’s choice of Washington, D.C. counsel “was a mere fortuity, over which defendants hadno control” and “d[id] not rise to the level of transacting business within the District that isnecessary to invoke the jurisdiction of our courts.”). FN22 “In the event that discovery would have led to State Farm officers other than Rust andTrosino, those persons could easily have been substituted as defendants.” Appellant’s OpeningBrief at 10-11 (emphasis added). FN23 Flocco’s remaining arguments with respect to Count II need not detain us long. Although,according to their affidavits, Rust and Trosino occasionally visit the District of Columbia forpurposes unrelated to this litigation (Rust to attend meetings of the American EnterpriseInstitute, the Business Roundtable, the National Alliance of Business, and the CorporateCampaign for the Red Cross; Trosino for meetings of the Brookings Institute, the NationalItalian-American Foundation, and for conferences with legislative branch officials), thesecontacts are insufficient to establish that either defendant is domiciled in the District ormaintains his principal place of business there. See D.C. Code � 13-422 (1995). Accordingly,Flocco’s claim that the Superior Court had “general jurisdiction” over Rust and Trosino iswithout merit. See Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414-15(1984). Flocco also asserts that the trial judge should have permitted him to conduct discoverywith respect to the sufficiency of Rust’s and Trosino’s contacts with the District. Thedetermination whether to permit jurisdictional discovery is confided to the sound discretionof the trial court. See, e.g., Caribbean Broadcasting Sys., Ltd. v. Cable & Wireless PLC, 331U.S. App. D.C. 226, 235-36, 148 F.3d 1080, 1089-90 (1998). In order to be entitled tojurisdictional discovery, a plaintiff “must have at least a good faith belief that such discoverywill enable [him] to show that the court has personal jurisdiction over the defendant[s].”Caribbean, supra, 331 U.S. App. D.C. at 236, 148 F.3d at 1090. Especially in light ofFlocco’s admission that discovery might have led him to substitute other individuals for Rustand Trosino, we do not believe that Flocco made the necessary showing. Moreover, Flocco’scomplaint was subject to dismissal in any event for failure to satisfy the prerequisites of aderivative action, and the law suit therefore could not continue in any event.
Flocco v. State Farm Mut. Auto. Ins. Co., DISTRICT OF COLUMBIA COURT OF APPEALS No. 98-CV-135 THOMAS V. FLOCCO, APPELLANT, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, et al., APPELLEES. Appeal From: Superior Court of the District of Columbia Argued: October 12, 1999 Decided: May 25, 2000 Counsel for Appellant: Larry Klayman, Paul J. Orfanedesm, James W. Ducayet, Walter C. Carlson Counsel for Appellee: Allan Horwich, Heidi Dalenberg, Jeffrey J. Bushofsky, Barbara K.Heffernan, and Debra Ann Palmer, Edward B. Rust, Jr., Vincent J. Trosino,Richard L. Brusca, and Donna L. Wilson Before: SCHWELB, FARRELL, and WASHINGTON, Associate Judges.
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