Sphere Digital, LLC v. Armstrong

Background

Sphere Digital, LLC brought claims against Offer Space, LLC, Christopher Armstrong, and Traffic Space LLC. It alleged that Offer Space breached a contract, that Armstrong and Traffic Space were responsible as alter egos for Offer Space’s obligations, and that all three defendants were unjustly enriched. Offer Space filed an answer and counterclaim, while Armstrong and Traffic Space moved to dismiss. The court had previously denied that motion.

The defendants then jointly moved under 28 U.S.C. § 1404(a), a federal statute allowing a court to transfer a civil case for the convenience of the parties and witnesses and in the interest of justice. Sphere Digital filed a statement of non-opposition.

Transfer Analysis

The court applied a two-step analysis: whether the case could have been brought in the proposed new district and whether convenience and the interests of justice favored transfer. The court concluded that the case could have been filed in Utah because all three defendants had strong Utah connections. Offer Space and Traffic Space were organized and had their principal places of business in Utah, Armstrong lived in Utah, and the companies shared a Utah office address.

The court also found Utah more convenient because the alleged breach occurred there and Sphere Digital had conducted business with the defendants there for years. Sphere Digital was organized under Delaware law and had its principal place of business in California, while the opinion stated that its owner lived in California. The court did not determine whether the New York forum-selection clause in the Insertion Order or the Utah forum-selection clause in the Program and Site Terms and Conditions governed the dispute.

Disposition

Chief Judge Colleen McMahon granted the defendants’ motion to transfer the case to the District of Utah. The Clerk of Court was directed to remove the motion from the list of pending motions.