Unity Electric Co. Inc. v. Microdesk, Inc.

Background

Microdesk moved to dismiss the case or transfer it to the United States District Court for the District of New Hampshire. The dispute centered on a forum-selection clause in the parties’ Master Service Agreements. That clause provided that litigation would be brought exclusively in the federal district where the Microdesk office was located in which the services were contracted.

Microdesk argued that the services were contracted in New Hampshire because Jody Reynolds and Darren End negotiated the contract terms there. The plaintiffs, Unity Electric Co. Inc. and Unity International Group, argued that the services were contracted in New York because Greg Lehrer, Microdesk’s Director of Consulting Services, signed the agreements while located in New York.

Court’s Analysis

The Court interpreted “in which the Services were contracted” to mean the place where the contract was formed. Under both New York and New Hampshire law, a contract is formed when the parties reach a “meeting of the minds,” meaning mutual agreement on the essential terms and an intention to be bound.

The Court found that the existing submissions did not establish when that agreement occurred or which Microdesk employees were responsible for reaching or approving the final terms. The materials stated that Microdesk first submitted a proposal to Unity International Group on December 17, 2019; Lehrer signed that proposal, and Unity International Group countersigned it on January 15, 2020. The Master Service Agreements were later entered as an extension of that proposal. But the Reynolds Declaration did not describe when or how the parties agreed to the relevant terms, identify the offer and acceptance, or explain who at Microdesk ultimately approved or signed off on those terms.

Order

The Court did not decide the venue-transfer issue in this order. It ordered Microdesk to submit one or more supplemental declarations by August 11, 2023, describing the negotiations, how and when the parties reached a final agreement on the contract language, and which employees were involved. Microdesk could attach relevant documents, including email communications. The plaintiffs could also submit supplemental declarations and documents addressing where the parties reached their agreement, including facts supporting their position that the contracts were not formed until Lehrer signed them. The parties could further address whether discovery was relevant to these questions.

The order was signed by Judge John P. Cronan on August 4, 2023. It does not state a final disposition of Microdesk’s motion to dismiss or transfer.