Hoar v. Launch Pad Payment Services Corporation
- Colleen McMahon
- 1:24-cv-06195
- U.S. District Court · Southern District of New York
- 19
In Hoar v. Launch Pad, Judge McMahon denied the dismissal motion without prejudice and ordered discovery about which company processed the disputed transactions.
The three named plaintiffs, the proposed class, Hotmart BV, and Launch Pad Payment Services Corporation are affected. The ruling requires Hotmart and Launch Pad to provide transaction-processing records and leaves the defendants able to renew their dismissal motion.
What happened
Hoar v. Launch Pad Payment Services Corporation involved claims by three consumers who alleged that Hotmart and Launch Pad charged them for products they did not authorize or receive. The defendants asked the court to dismiss the case and reject class treatment, relying partly on Hotmart’s forum-selection clause.
Judge McMahon decided that the clause was mandatory, was reasonably presented to consumers during checkout, and covered the plaintiffs’ claims. But the clause selected different courts depending on which company processed each transaction, and the available record did not show which company handled the disputed charges.
Judge McMahon therefore denied the motion without prejudice and ordered limited discovery by June 26, 2025, requiring records identifying the company that processed each transaction. The defendants may renew their motion after that discovery.
The detailed version
- Hoar v. Launch Pad Payment Services Corporation · No. 1:24-cv-06195
- Colleen McMahon
- May 12, 2025
Background
Timothy Hoar, Thomas Simmons, and Timothy Arias brought a proposed class action against Launch Pad Payment Services Corporation and Hotmart BV. They asserted claims involving allegedly unauthorized charges and products they say they did not receive, under New York consumer-protection laws, the federal Electronic Funds Transfer Act, unjust enrichment, conversion, fraud, and consumer-protection laws of Washington and California.
Hotmart operates an online platform where creators sell digital products and services. The complaint alleges that Launch Pad is used by Hotmart to process transactions involving creators and consumers in the United States. The plaintiffs alleged that they each made at least one authorized purchase through the platform and later incurred additional charges for products or subscriptions they did not authorize.
The defendants moved to dismiss the amended complaint in its entirety under Federal Rule of Civil Procedure 12(b)(6), which concerns whether a complaint adequately states a claim, and Rule 23(b)(3), which concerns requirements for certain class actions. They argued, among other things, that the case was filed in violation of a forum-selection clause in Hotmart’s Terms of Use.
Forum-Selection Clause
The Terms of Use stated that disputes unrelated to a specific transaction must be brought in Amsterdam. For disputes related to a specific transaction, the required forum depended on which Hotmart-related company processed the transaction: Amsterdam if Hotmart BV processed it, Brazil if the Brazilian company processed it, and the Southern District of New York or New York state court if Launch Pad processed it.
The plaintiffs argued that they never agreed to the Terms of Use or the forum-selection clause. The court rejected that argument. It held that the clause used mandatory language because it designated the “exclusive venue” for litigation. It also held that the clause was reasonably communicated because the checkout page placed a notice about agreeing to the Terms of Use near the “Buy Now” button, displayed the Terms of Use as a hyperlink, and was not materially cluttered or distracting.
The court further held that the clause applied to all of the plaintiffs’ claims. Although the plaintiffs characterized their allegations as challenging deceptive billing practices generally, the court concluded that the claims concerned specific transactions, including charges identified by date and amount. The court also found that the plaintiffs had not shown that enforcing the clause would be unreasonable or unjust.
Jurisdictional Discovery
The court concluded that the remaining issue was which part of the transaction-related provision applied. The record did not establish whether Hotmart BV, Launch Pad, or the Brazilian company processed the authorized and allegedly unauthorized transactions. The plaintiffs acknowledged that they could not distinguish between Hotmart BV and Launch Pad as the processor before discovery.
The court therefore ordered targeted jurisdictional discovery. It directed Hotmart and Launch Pad to provide the plaintiffs’ counsel, by June 26, 2025, with records showing which company processed every transaction identified in the amended complaint. The plaintiffs’ counsel was directed to promptly report that information to the court.
Disposition
The court denied the defendants’ motion at Docket No. 43 without prejudice and directed that it be removed from the court’s list of open motions. The defendants may renew the motion after discovery by filing a new notice of motion and a supplemental brief. The court did not decide the remaining merits-based arguments in the motion, stating that it would address them if the Southern District of New York proved to be the proper forum.
Judge
The decision was issued by U.S. District Judge Colleen McMahon.
Read the full 19-page opinion on CourtListener, the free public archive maintained by the Free Law Project.