1:17-cv-06661
S.D.N.Y.Aug 31, 2017Background
- Plaintiffs Seva Safris (California) and Alex Yuryev (Minnesota) are former VNUE employees who allege breach of contract, fraud, unpaid wages, and related claims against VNUE (a Nevada corporation) and VNUE COO Matthew Carona.
- VNUE was originally incorporated in Washington, merged into a Nevada corporation, and operates an office in New York City where Carona works part-time; Peter Slavish works at the New York office.
- Plaintiffs served process by leaving copies with Slavish at VNUE’s New York office and mailing documents to Carona at that office; no proof of service was timely filed with the court.
- Defendants moved to quash service, to dismiss Carona for lack of personal jurisdiction, and to transfer venue to the Southern District of New York under 28 U.S.C. § 1404(a).
- The court found service on both Carona and VNUE defective under applicable rules, granted leave to re-serve within 30 days, and concluded transfer to SDNY was appropriate; Carona’s jurisdictional motion was denied as moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Service on Carona (New York "leave and mail" under N.Y. C.P.L.R. § 308(2)) | Service was proper: summons delivered to Slavish at Carona’s actual place of business and mailed to Carona at that office | Service was incomplete because plaintiffs failed to file proof of service within 20 days as § 308(2) requires | Service on Carona quashed for failure to file proof of service; plaintiffs given 30 days to properly serve |
| Service on VNUE (corporate service) | Serving Slavish at NY office was sufficient | Slavish is not an officer, managing agent, or authorized recipient for corporate service under Fed. R. Civ. P. 4(h) / N.Y. C.P.L.R. § 311 | Service on VNUE quashed; plaintiffs given 30 days to properly serve |
| Transfer of venue to SDNY under 28 U.S.C. § 1404(a) | Plaintiffs prefer Nevada forum; contracts have Nevada choice-of-law clause | SDNY is an adequate alternative; key contacts, witnesses, agreements, and evidence are in New York; personal jurisdiction issues over Carona favor transfer | Court granted transfer to Southern District of New York after balancing convenience and interests of justice |
| Personal jurisdiction over Carona in Nevada | Plaintiffs assert jurisdiction over Carona in Nevada tied to VNUE's Nevada incorporation and corporate activities | Carona’s ties to Nevada are limited (maintaining corporate status); acts are not such that he is "at home" in Nevada; specific jurisdiction lacking | Court found strong likelihood Nevada lacks personal jurisdiction over Carona; raised this as a factor favoring transfer and denied Carona’s motion as moot after transfer |
Key Cases Cited
- S.J. v. Issaquah Sch. Dist. No. 411, 470 F.3d 1288 (9th Cir. 2006) (rule on service and motion practice cited)
- Jones v. GNC Franchising, Inc., 211 F.3d 495 (9th Cir. 2000) (burden on movant to show adequate alternative forum for transfer)
- Daimler AG v. Bauman, 134 S. Ct. 746 (2014) (general jurisdiction requires defendant to be at home in the forum)
- Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797 (9th Cir. 2004) (specific jurisdiction requires claim to arise out of forum-related activities)
- S.E.C. v. Internet Sols. for Bus. Inc., 509 F.3d 1161 (9th Cir. 2007) (discussion of when service is complete for federal court jurisdiction)
- Lueck v. Sundstrand Corp., 236 F.3d 1137 (9th Cir. 2001) (deference to plaintiff's forum choice reduced for foreign plaintiffs)
- Boston Telecomms. Grp. v. Wood, 588 F.3d 1201 (9th Cir. 2009) (forum-selection and deference principles)