Vaughn v. Yakubov

Background

Julian Vaughn brought the action without a lawyer and invoked federal diversity jurisdiction. He alleged that, from April 1 through April 14, 2023, he negotiated and entered into an agreement with Arkham Funding Solutions for a line of credit exceeding $2 million. Vaughn alleged that Emmanuel Yakubov, the underwriter, told him to wire $287,000: $175,000 would be held as collateral, and $112,000 would be used to establish a payment history to improve Vaughn's business rating with Dun & Bradstreet. Vaughn further alleged that Yakubov set up shell accounts, became unavailable after the money was wired, blocked Vaughn, and took the money.

Vaughn alleged that his claims arose in Brooklyn, New York, and gave Yakubov's address in Brooklyn. The opinion states that Vaughn paid the filing fee.

Venue Analysis

Federal law generally permits a civil action to be filed where a defendant resides, where a substantial part of the events occurred, or, in limited circumstances, where a defendant is subject to the court's personal jurisdiction. For venue purposes, an individual resides in the district where that person is domiciled.

The court determined from the complaint that the alleged events occurred outside the Southern District of New York and that the sole defendant resided outside that district. Under 28 U.S.C. § 1406(a), when a case is filed in the wrong venue, the court may dismiss it or, in the interest of justice, transfer it to a district where it could have been brought. Because Brooklyn is in the Eastern District of New York, the court concluded that venue was proper there under 28 U.S.C. § 1391(b)(2).

Ruling

The court transferred the action to the United States District Court for the Eastern District of New York under 28 U.S.C. § 1406(a), finding that transfer was in the interest of justice. The clerk was directed to transfer the action without delay. The order states that no summons would issue from the Southern District of New York and that the order closed the case in that district.

The court also certified under 28 U.S.C. § 1915(a)(3) that any appeal from the order would not be taken in good faith. It therefore denied fee-free appeal status for purposes of an appeal.