McCormick v. the Multistate Lottery

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

MARK MCCORMICK, Plaintiff/Appellant,

v.

THE MULTISTATE LOTTERY, et al., Defendants/Appellees.

No. 1 CA-CV 23-0497
FILED 3-26-2024

Appeal from the Superior Court in Maricopa County
No. CV2022-053274
The Honorable Michael D. Gordon, Judge

AFFIRMED

COUNSEL

Mark McCormick, Phoenix
Plaintiff/Appellant

Dorsey & Whitney LLP, Phoenix
By W. Scott Jenkins, Jr., Brittany Gilbertson, & Madison Burr
Counsel for Defendant/Appellee Multi-State Lottery Association

Burch & Cracchiolo PA, Phoenix
By Juliana Lauria
Counsel for Defendant/Appellee QuikTrip
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Decision of the Court

MEMORANDUM DECISION

Presiding Judge Paul J. McMurdie delivered the Court’s decision, in which
Judge Maria Elena Cruz and Judge Cynthia J. Bailey joined.

M c M U R D I E, Judge:

¶1 Mark McCormick appeals the superior court’s judgment
dismissing all claims against the Multistate Lottery (“Lottery”) and
QuikTrip with prejudice. We affirm.

FACTS AND PROCEDURAL BACKGROUND

¶2 McCormick filed a complaint seeking damages exceeding $6
billion from Lottery, QuikTrip, and the Arizona Lottery. He alleged the
defendants unlawfully tracked him to monitor his lottery ticket purchases
so they would know in advance from which retailers he would buy tickets
to prevent him from winning the lottery.

¶3 McCormick alleged the Arizona Lottery and Lottery
conducted a Powerball drawing on April 9, 2022, but forged the game by
placing McCormick’s “winning ticket” in the computer as a “losing ticket,”
preventing his win via a jackpot rollover. He also alleged that QuikTrip
agreed in advance to be the designated “rigging house” for a preplanned
drawing on April 27, 2022, in which a “nonexistent fictitious married
Gilbert couple” won. McCormick alleged the defendants agreed in advance
to lie to the public and then fraudulently reported that the Gilbert couple
came forward and claimed the $473.1 million jackpot. McCormick also
alleged wrongdoing against the Arizona Lottery, asserting that it
fraudulently announced unclaimed and expired tickets for a $1 million
prize for a March 5, 2022 Powerball drawing and a $3.9 million prize for an
April 27, 2022 Quick Pick drawing. McCormick pled conversion, consumer
fraud, forgery, and intentional infliction of emotional distress.

¶4 The superior court dismissed with prejudice the claims
against the Arizona Lottery based on McCormick’s failure to comply with
A.R.S. § 12-821.01.

¶5 The superior court also found McCormick failed to state a
claim against QuikTrip on all four claims. The court determined
McCormick failed to state a claim for conversion and consumer fraud

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because he failed to allege he bought tickets that could have been converted
or considered “merchandise” that would subject the defendants to liability
under the Arizona Consumer Fraud Act, see A.R.S. §§ 44-1521 to 44-1534.
The court determined that McCormick cited no authority for a private civil
case based on forgery and that the complaint failed to meet the heightened
pleading requirements of Arizona Rule of Civil Procedure (“Rule”) 9(b) to
support a private cause of action for common law fraud, which might
encompass forgery. The court concluded the complaint failed to allege the
elements necessary to establish a claim for intentional infliction of
emotional distress. Despite these failures, the court was inclined to allow
McCormick to amend his complaint.

¶6 McCormick moved for leave to amend and submitted a
proposed amended complaint. Upon review of the amended complaint, the
court again found that McCormick failed to state a claim against QuikTrip.
Although McCormick’s proposed amended complaint alleged the purchase
of lottery tickets, the court found he “[did] not and cannot allege [the]
lottery tickets were converted because he has no possessory right to the
funds.” See Autoville, Inc. v. Friedman, 20 Ariz. App. 89, 91-93 (1973). The
court also found McCormick failed to adequately allege any
misrepresentations, concealment, or omissions to support the fraud and
forgery claims. Finally, the court again concluded the complaint failed to
allege extreme and outrageous acts sufficient to state a claim for intentional
infliction of emotional distress. Thus, the court denied McCormick’s motion
for leave to file an amended complaint and denied him leave to file a second
motion for leave to file an amended complaint.

¶7 After reviewing Lottery’s motion to dismiss for lack of
personal jurisdiction with a supporting affidavit written by Lottery’s
deputy executive director, the superior court dismissed all claims against
Lottery. The affidavit noted that Lottery, which developed the Powerball
game, is an unincorporated Iowa non-profit association that does not have
any offices, employees, or agents for service of process in Arizona, nor does
it sell lottery tickets or conduct any other business in the state.

¶8 The superior court entered final judgments under Rule 54(c).
McCormick appealed, and we have jurisdiction under A.R.S.
§ 12-2101(A)(1).

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DISCUSSION1

A. This Court Lacks Jurisdiction to Consider the Judgment for the
Arizona Lottery.

¶9 McCormick raises the constitutionality of A.R.S. § 12-821.01.
Any argument about the statute is necessarily directed to the Arizona
Lottery, whose judgment McCormick did not appeal. Thus, this court lacks
jurisdiction over the issues. See ARCAP 9(a); In re Marriage of Thorn, 235
Ariz. 216, 218, ¶ 5 (App. 2014).

B. The Superior Court Correctly Granted QuikTrip’s Motion to
Dismiss.

¶10 We review the dismissal of a complaint for the failure to state
a claim de novo. Coleman v. City of Mesa, 230 Ariz. 352, 355, ¶¶ 1, 7 (2012). On
appeal, McCormick argues that legal arguments made by attorneys in
motion practice are insufficient to grant a motion to dismiss.

¶11 In response to QuikTrip’s motion to dismiss, McCormick
stated the correct standard that a claim must be dismissed when a plaintiff
is not entitled to relief under any interpretation of the facts. See Coleman, 230
Ariz. at 356, ¶ 8. Still, he developed no substantive argument that his
allegations correctly set forth a claim, even if true. Instead, he argued that
he should be permitted the opportunity to conduct discovery and gather
additional evidence to support his claims. His argument shows he
misunderstands the nature of a complaint as a vehicle to permit a plaintiff
to move forward and attempt to prove his case. See id. at 363, ¶ 46 (The
question presented by a motion to dismiss for failure to state a claim is
whether the facts as alleged in a complaint are enough to “warrant allowing
the [plaintiff] to attempt to prove [its] case.”).

¶12 We have reviewed the complaint allegations and determined
that McCormick’s complaint failed to state a claim. The court did not abuse
its discretion by denying McCormick’s motion for leave to file an amended
complaint based on futility grounds. See MacCollum v. Perkinson, 185 Ariz.
179, 185 (App. 1996).

1 We deny QuikTrip’s request to dismiss McCormick’s appeal for
failure to comply with ARCAP 13. Although McCormick’s briefs are
deficient and his arguments difficult to discern, we address them as best we
can.

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C. The Superior Court Correctly Dismissed Lottery for Lack of
Personal Jurisdiction.

¶13 McCormick challenges the superior court’s dismissal of
Lottery for lack of personal jurisdiction. We review a dismissal based on a
lack of personal jurisdiction de novo. Bohreer v. Erie Ins. Exch., 216 Ariz. 208,
211, ¶ 7 (App. 2007).

¶14 In its ruling dismissing the claims against Lottery for lack of
personal jurisdiction, the superior court considered the affidavit attached
to Lottery’s motion to dismiss written by the deputy executive director
declaring Lottery’s lack of contacts in Arizona. As much as McCormick
argues the court improperly considered matters outside the pleadings
when deciding Lottery’s motion to dismiss for lack of personal jurisdiction,
McCormick failed to raise this issue in his response and thus waived it. See
ADP, LLC v. Ariz. Dep’t of Revenue, 254 Ariz. 417, 425, ¶ 25 (App. 2023).
Moreover, the court may consider documents outside the complaint in its
ruling. See Bohreer, 216 Ariz. at 210, ¶ 1, n.1 (Appellate review “is not altered
by the parties having filed documents outside of the complaint and the
superior court having appeared to consider those documents in its
ruling.”); MacPherson v. Taglione, 158 Ariz. 309, 312 (App. 1988) (The
superior court’s review of affidavits and pleadings in analyzing personal
jurisdiction issues is permitted.).

¶15 McCormick argues the superior court can exercise general or
specific jurisdiction over Lottery. He concludes Lottery committed acts
purposefully directed2 at Arizona with intent to cause harm. He argues
Lottery has “quality contacts consistently in Arizona” and cites Lottery’s
weekly receipt of a portion of member ticket sales to fund game prize pools.

¶16 A non-resident defendant is subject to general jurisdiction
when its contacts with the forum state are sufficiently “continuous and
systematic” such that it may be haled into the forum court even for claims

2 McCormick argues in his reply brief that the superior court erred by
using the “purposeful availment” test instead of the “purposeful direction”
test, a difference with no distinction for purposes of this appeal. See Plan.
Grp. of Scottsdale, L.L.C. v. Lake Mathews Min. Props., Ltd., 226 Ariz. 262,
266-68, ¶¶ 18-25 (2011) (The court rejected the distinction between the two
tests as applied to contract or tort claims and focused the
specific-jurisdiction inquiry on “purposeful conduct” directed toward the
state.).

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unrelated to its contacts in the forum. See Helicopteros Nacionales de Colombia,
S.A. v. Hall, 466 U.S. 408, 414-16 (1984). The activities McCormick relies on
do not amount to sufficient contacts for the superior court to assert general
jurisdiction over Lottery. See id. at 418 (“[M]ere purchases, even if occurring
at regular intervals, are not enough to warrant a State’s assertion” of general
jurisdiction.); Rollin v. William V. Frankel & Co., 196 Ariz. 350, 352-53, ¶¶ 9-12
(App. 2000) (There was no general jurisdiction over a non-resident
defendant who conducted $14 million in trades with broker-dealers in
Arizona.).

¶17 And nothing in Lottery’s affidavit supports the exercise of
specific jurisdiction. Any contacts cited have no nexus with McCormick’s
causes of action. See Shaffer v. Heitner, 433 U.S. 186, 204 (1977) (The specific
jurisdiction inquiry focuses on the “relationship among the defendant, the
forum, and the litigation.”); Plan. Grp. of Scottsdale, L.L.C. v. Lake Mathews
Min. Props., Ltd., 226 Ariz. 262, 266, ¶ 16 (2011) (Contacts “not directly
related to the asserted cause of action, cannot sustain the exercise of specific
jurisdiction.”). The only contacts that could support the exercise of specific
jurisdiction are the alleged wrongful acts, for which McCormick has
provided no supporting evidence. McCormick’s conclusory allegations of
Lottery’s misconduct cannot support the exercise of specific jurisdiction. See
MacPherson, 158 Ariz. at 311-12.

D. McCormick Failed to Allege Judicial Misconduct.

¶18 McCormick requests we vacate the superior court’s judgment
because two judges were “removed” from the case, which McCormick
argues is evidence of judicial fraud and abuse of the court’s machinery.
McCormick develops no argument about judicial misconduct or abuse in
court proceedings. McCormick also argues the superior court should have
summarily granted his motion for leave to file an amended complaint
under Rule 7.1(b)(2) because the defendants failed to respond. He also
argues the court’s subsequent order permitting the defendants more time
to respond violated his constitutional rights. But Rule 7.1(b)(2) is
permissive, and the superior court appropriately denies leave to amend in
futility cases. See ELM Ret. Ctr., LP v. Callaway, 226 Ariz. 287, 292, ¶ 26 (App.
2010). McCormick develops no constitutional argument.

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CONCLUSION

¶19 We affirm. We award costs to Lottery and QuikTrip upon
compliance with ARCAP 21.

AMY M. WOOD • Clerk of the Court
FILED: AA

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