Payment Alliance International, Inc. v. Deaver
3:17-cv-00693
W.D. Ky.Feb 1, 2018Background
- PAI (Delaware corp., principal place Louisville, KY) acquired Absolute ATM and hired Deaver (Minnesota resident) as a field technician in April 2016; shortly after Deaver signed a Vault Cash Agreement (VCA) to provide vault-cash services and shared-revenue compensation.
- The VCA contains (1) an exclusive forum-selection clause naming Kentucky (Jefferson County) and (2) a non-solicitation covenant restricting solicitation of PAI merchants for up to three years post-termination.
- Deaver’s employment/relationship ended July 31, 2017; PAI alleges Deaver solicited PAI customers and diverted business to Kahuna ATM and Ultimate ATM (his mother’s company).
- PAI sought a temporary restraining order (TRO) alleging irreparable harm from continued solicitation; Deaver moved to dismiss for lack of personal jurisdiction and alternatively to transfer to Minnesota under 28 U.S.C. § 1404(a).
- The court held the forum-selection clause enforceable, denied Deaver’s Rule 12(b)(1) dismissal (personal jurisdiction satisfied by consent), denied his transfer motion, and denied PAI’s TRO for lack of demonstrated likelihood of success on the merits (insufficient evidence of solicitation/breach at this stage).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability of forum-selection clause | Clause is valid and requires Kentucky jurisdiction | Clause was in a non-negotiated form and burdensome to Deaver | Clause enforceable; Deaver failed to show fraud, unfairness, or extreme inconvenience |
| Personal jurisdiction | Kentucky forum clause waives jurisdictional objections | Minnesota resident: no contacts with Kentucky sufficient for personal jurisdiction | Personal jurisdiction exists by contractual consent; 12(b)(1) motion denied |
| Transfer under § 1404(a) | No transfer; plaintiff chose forum in contract; Kentucky interest (PAI HQ) | Move to transfer to Minnesota for convenience and local interest | Transfer denied: with valid forum clause, court considered only public factors and found they do not overcome the clause |
| TRO / preliminary injunction | Immediate irreparable harm from solicitation; enforcement of non-solicit warranted | No evidence Deaver solicited; TRO would unnecessarily restrain work | TRO denied: PAI failed to show likelihood of success on breach; other TRO factors did not overcome that deficiency |
Key Cases Cited
- Preferred Capital, Inc. v. Assocs. in Urology, 453 F.3d 718 (6th Cir.) (forum-selection clauses as consent to jurisdiction)
- Wong v. PartyGaming Ltd., 589 F.3d 821 (6th Cir.) (standard for enforcing forum-selection clauses)
- Atlantic Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex., 571 U.S. 49 (2013) (effect of a valid forum-selection clause on § 1404(a) analysis)
- Van Dusen v. Barrack, 376 U.S. 612 (1964) (transfer analysis prerequisite)
- Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers Local No. 70, 415 U.S. 423 (1974) (burden of party seeking preliminary injunctive relief)