Greenhouse v. Symmetry

Background

Albert Greenhouse brought claims under federal law, California law, and common law, alleging that the defendants were involved in a scheme to deprive him of payments made under a project contract. Greenhouse resides in California. The opinion states that the relevant individuals and entities reside in California except Ghostwriting Universe, which has its principal place of business in Spring, Texas. Only Blitz Design, Inc. and 360 Art Studio, Inc. were served, and neither appeared. A default judgment had previously been granted against those two defendants.

The contract signed by Website Symmetry included a forum-selection provision allowing proceedings in New York or in federal courts in California. The opinion states that Website Symmetry was alleged to be a California-based business with no known connection to New York, and that none of the other defendants was alleged to reside in New York.

Venue and Transfer Analysis

The court considered venue under 28 U.S.C. § 1391 and transfer under 28 U.S.C. § 1404(a). It concluded that, even assuming venue was proper in New York, the Northern District of California was also a proper venue because the claims arose from a contract governed by California law, the contract permitted a California federal forum, and the alleged events were overwhelmingly connected to California.

Applying the convenience and fairness factors under Section 1404(a), the court found that the Northern District of California appeared more convenient. The relevant parties were concentrated in California, including in areas within the Northern District of California; the plaintiff resided in California; and the relevant documents and witnesses were reasonably expected to be in or near Berkeley, Bakersfield, and Fremont. The court also gave less weight to Greenhouse's choice of New York because he did not reside there and the operative events did not occur there.

The court rejected Greenhouse's argument that the forum-selection provision prevented transfer. It characterized the provision as permissive rather than exclusive because it allowed a choice between New York and California. The court did not decide which non-signatory defendants were bound by the provision, but reasoned that California would remain an available forum whether the provision bound only Website Symmetry or also other defendants.

The court also found that Greenhouse's arguments for personal jurisdiction over Blitz Design and 360 Art Studio in New York were weak. Greenhouse relied on banking transactions involving banks headquartered in New York and the Fedwire service. The court noted that the complaint did not allege that the defendants purposefully used or directed funds to New York correspondent accounts, and an attached document showed that a referenced JPMorgan Chase Bank account was in West Covina, California. The court expressly stated that it was making no jurisdictional findings in the opinion.

Disposition

The court transferred the action to the United States District Court for the Northern District of California under 28 U.S.C. § 1404(a). Judge Katharine H. Parker directed the Clerk to transfer the action and stated that the order closed the case in the Southern District of New York. The court explained that the plaintiff could refile his damages inquiry in the California court. The transfer order did not decide the merits of Greenhouse's underlying claims.

The provided case-information header identifies the court as the Northern District of California, but the opinion itself is captioned as an order from the Southern District of New York and directs transfer to the Northern District of California.