Nodify, Inc. v. Kristan
2:17-cv-02201
E.D.N.YJan 11, 2018Background
- Nodify, a New York corporation, sued Frank Kristan (pro se) and Unitiv, Inc. alleging breach of contract, fraud, conversion, unjust enrichment, and civil conspiracy arising from a 2016 funding arrangement and related agreements.
- Unitiv (a Georgia corporation) contracted to provide $250,000 to Nodify, including $125,000 from TCA Global (with New York offices); Nodify alleges Unitiv received funds but Kristan diverted them for personal use.
- Kristan executed a March 2, 2016 Reseller Agreement with Nodify that contains New York choice-of-law and exclusive forum-selection clauses (Suffolk County, NY), and a January 31, 2017 amendment referencing the funding dispute and payment plan.
- Kristan moved to dismiss for lack of personal jurisdiction and improper venue, to stay discovery, and to disqualify Nodify’s counsel.
- The court denied the stay of discovery and denied the disqualification motion without prejudice. It denied Kristan’s Rule 12(b)(2) and 12(b)(3) motions, reserving decision on any Rule 12(b)(6) challenges.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over Kristan (NY CPLR § 302(a)(1)) | Kristan transacted business with Nodify in NY, executed agreements governed by NY law, and tort claims arise from those transactions | Kristan is a South Carolina resident; NY lacks jurisdiction over him | Denied — plaintiff made a prima facie showing under §302(a)(1); Kristan’s contacts and forum clauses satisfy due process |
| Venue (28 U.S.C. § 1391) | Majority of events occurred in Eastern District of NY; forum-selection clauses in Reseller Agreement point to Suffolk County, NY | Kristan contends NY is inconvenient; he resides in South Carolina | Denied — plaintiff pled facts making venue proper; forum-selection and alleged diversion of NY-linked funds support venue |
| Motion to stay discovery | Not directly contested by plaintiff | Kristan sought stay pending dismissal | Denied — Unitiv appeared and discovery will proceed against Unitiv, so stay against Kristan not permitted |
| Motion to disqualify plaintiff’s counsel | Nodify contends counsel proper | Kristan sought disqualification of James A. Powers | Denied without prejudice — may renew if appropriate after a trial date is set |
Key Cases Cited
- Allied Dynamics Corp. v. Kennametal, Inc., 965 F. Supp. 2d 276 (E.D.N.Y. 2013) (prima facie showing suffices to defeat pre-discovery personal jurisdiction challenge)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (minimum contacts and purposeful availment analysis for due process)
- Asahi Metal Indus. Co. v. Superior Court of Cal., Solano Cnty., 480 U.S. 102 (1987) (reasonableness and fair play considerations in jurisdictional due process analysis)
- Bensusan Rest. Corp. v. King, 126 F.3d 25 (2d Cir. 1997) (forum-selection and long-arm statute context)
- Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353 (2d Cir. 2005) (standard for evaluating venue challenges under Rule 12(b)(3))
- CutCo Indus. v. Naughton, 806 F.2d 361 (2d Cir. 1986) (plaintiff need only make prima facie showing of venue when court relies on pleadings and affidavits)