Chaturvedi v. Orbcomm Inc.

Background

Vivek Chaturvedi sued Orbcomm Inc., inthinc Technology Solutions, Inc., inthinc, inc., and Todd Follmer. The opinion describes Chaturvedi as the former chief financial officer of inthinc Technology Solutions, Inc., and Follmer as inthinc’s former chief executive officer. The court states that default had been entered against both inthinc entities. Follmer filed the motion addressed in this order.

Chaturvedi worked for inthinc from August 2012 through February 2017. During the relevant period, inthinc was headquartered in Salt Lake City, Utah, and Chaturvedi had an office there while continuing to reside in Santa Clara County. The discussions between Chaturvedi and Follmer about Chaturvedi’s compensation and employment took place at inthinc’s Salt Lake City office. Chaturvedi’s written employment agreement was governed by Utah law and included a permissive Utah venue provision.

Chaturvedi alleged that the defendants failed to pay previously earned wages of $300,000, a severance package exceeding $460,000, and exit incentives exceeding $2 million related to Orbcomm Inc.’s June 2017 acquisition of inthinc’s assets. His six claims were for breach of a written employment agreement, breach of an oral employment agreement, breach of an oral exit-incentive agreement, breach of fiduciary duties, fraud, and setting aside allegedly fraudulent transfers.

Venue Analysis

Follmer argued that Chaturvedi had not shown that venue was proper in the Northern District of California and that all actions giving rise to the claims occurred in Utah. Chaturvedi opposed dismissal on both venue and claim-related grounds and asked the court to transfer the case to Utah rather than dismiss it, in part because dismissal could create statute-of-limitations problems. Follmer argued for dismissal instead of transfer.

The court explained that federal venue may be proper where a defendant resides under specified conditions, where a substantial part of the events or omissions occurred, or, if no other district qualifies, where a defendant is subject to personal jurisdiction. The plaintiff bears the burden of showing that venue is proper. In deciding an improper-venue motion, the court may consider evidence outside the pleadings.

The court found venue improper in the Northern District of California. It stated that the complaint’s only venue reference was the permissive Utah venue clause in the written employment agreement. The court also found that all events giving rise to Chaturvedi’s claims occurred in Utah because the relevant compensation and employment discussions took place there, which Chaturvedi did not dispute. The court rejected as irrelevant Chaturvedi’s arguments about general employment activities that occurred in California because those activities did not give rise to the asserted claims.

Disposition

The court exercised its discretion to transfer the case rather than dismiss it. It GRANTED Follmer’s motion for improper venue, ordered the Clerk to transfer the action to the District of Utah, and directed the Clerk to close the case. The court expressly declined to rule on the substance of Chaturvedi’s claims, leaving those issues for the Utah judge who would preside over the case. The court also stated that any preliminary comments about the pleadings at the December 17, 2020 hearing were not binding on the parties or the future court.