Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-05184/USCOURTS-cand-3_04-cv-05184-1/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

TRIBAL FUSION, INC.,

Plaintiff,

 v.

CLICK HERE, INC. d/b/a RICHARDS

INTERACTIVE, et al.,

Defendants.

 /

No. C 04-05184 JSW

ORDER DENYING

DEFENDANTS’ MOTIONS TO

DISMISS FOR IMPROPER

VENUE, TO ABATE, OR TO

TRANSFER

Now before the Court are the motions of defendant True Beginnings, LLC (“True”) to

dismiss the complaint for improper venue, in the alternative to abate the case, or to transfer the

above captioned matter to Texas and of defendants Click Here, Inc. d/b/a Richards Interactive

(“Click Here”) and the Richards Group, Inc. to dismiss, abate or transfer. Having carefully

reviewed the parties’ papers and considered their arguments and the relevant legal authority, and

good cause appearing, the Court DENIES Defendants’ motions.

BACKGROUND

In this case, plaintiff Tribal Fusion Inc. (“Tribal Fusion”) is suing for breach of contract

and account stated based on Defendants’ alleged failure to pay Tribal Fusion for internet

advertising services it provided. Tribal Fusion is a company with its principal place of business

in Emeryville, California. (Compl., ¶ 5; Declaration of Dilip DaSilva (“DaSilva Decl.”), ¶ 2.) 

Tribal Fusion alleges that it signed several advertising placement insertion orders with Click

Here, performed all the work required by it under the contracts and caused advertisements to be 

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placed for True on web sites, but has not been paid in full under the contracts. (Compl., ¶¶ 12-

15, 17-19.) All of the insertion orders were generated by Tribal Fusion at its offices in

Emeryville. (DaSilva Decl., ¶ 4.) It performed all the services under those orders from

Emeryville, and Tribal Fusion submitted invoices issued from its offices in Emeryville for such

services. (DaSilva Decl., ¶¶ 5-6.) 

Defendants assert that the real crux of the dispute in this case is not whether Tribal

Fusion actually provided the services or is owed money, but rather, which defendant, True or

Click Here is liable to Tribal Fusion. (True Mot. at 1; Click Here Mot. at 2.) True and Click

Here, both Texas companies, entered into an agreement under which Click Here was supposed

to obtain on-line advertising services for True. True and Click Here initially disputed which

company was liable to the vendors, such as Tribal Fusion, who provided the advertising services

that Click Here solicited on behalf of True. Approximately two months before Plaintiff filed the

lawsuit in this Court, Click Here filed an action against True in a state court in Texas, alleging

that True failed to pay Click Here for the services it rendered. (True Mot., Ex. B, ¶¶ 10, 19-20.)

In the Texas state action, True filed counterclaims against Click Here alleging, inter alia, claims

for breach of contract, fraud and negligent misrepresentation. (True Mot., Ex. D.) Both True

and Click Here argue either that the above captioned case should be stayed until the underlying

dispute between True and Click Here is resolved or that this case should be transferred to Texas. 

However, since the parties submitted their briefs on these motions, True and Click Here

informed the Court that they reached a settlement and dismissed all their claims against each

other in the Texas state action. (Notice of Status of Related Action in Texas.) Although some

vendors intervened in the Texas state action, and thus that case continues, the disputes between

True and Click Here, including any dispute as to which company is liable to the vendors, is no

longer being litigated in Texas. (Id.)

A. Venue is Proper in California.

Defendants move to dismiss this action based on improper venue. “[V]enue is proper in

a judicial district if ‘a substantial part of the events or omissions giving rise to the claim

occurred’ in that district. Myers v. Bennett Law Offices, 238 F.3d 1068, 1075 (9th Cir. 2001)

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(quoting 28 U.S.C. § 1391). In Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834

(9th Cir. 1986), the Ninth Circuit found that, in a breach of contract case, the most appropriate

venue is the place where the contract was intended to be performed. Id. at 842; see also

Shropshire v. Fred Rappoport Co., 294 F. Supp. 2d 1085, 1094 (N.D. Cal. 2003) (finding venue

proper where some of the negotiations were conducted and a substantial portion of the

performance occurred).

Here, Tribal Fusion negotiated and performed the contracts from its offices in

Emeryville, California. Therefore, venue is proper in the Northern District of California.

B. Abatement Is Not Warranted.

Defendants initially argued in their motions that this case should be abated while the

companies resolve their underlying dispute in the Texas state action. In exceptional

circumstances, district courts may stay or dismiss an action pursuant to the Colorado River

Doctrine when there are concurrent state and federal proceedings involving the same matter. 

Moses H. Cone Memorial Hosp. v. Mercury Center, 460 U.S. 1, 14-15 (1983). To determine

whether to stay or dismiss a case, courts consider the following factors: “(1) whether either court

has assumed jurisdiction over a res; (2) the relative convenience of the forums; (3) the

desirability of avoiding piecemeal litigation; ... (4) the order in which the forums obtained

jurisdiction; ... (5) whether state or federal law controls and (6) whether the state proceeding is

adequate to protect the parties’ rights.” Nakash v. Marciano, 882 F.2d 1411, 1415 (9th

Cir.1989) (internal citations omitted). In the Ninth Circuit, courts should also consider whether

the second suit is an “attempt to forum shop or avoid adverse rulings by the state court,” as well

as the threshold issue of whether the state and federal actions are “substantially similar.” Id. at

1417. Courts must not apply the checklist mechanically, but rather, carefully balance the

important factors as they apply in a given case, “with the balance heavily weighted in favor of

the exercise of jurisdiction.” Moses H. Cone., 460 U.S. at 16. 

Now that True and Click Here have reached a settlement regarding their underlying

disputes and have dismissed all their claims against each other from the Texas state action, the

balance tips strongly in favor of this Court exercising jurisdiction and against staying or

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dismissing this case. Although other vendors who intervened in the Texas state action are still

pursuing their claims in that court, there is no longer a risk of piecemeal litigation regarding the

dispute between Tribal Fusion and Defendants or regarding the underlying dispute between

Defendants. Moreover, now that the underlying dispute between True and Click Here is no

longer at issue in the Texas state action, the state proceeding is not adequate to protect Tribal

Fusion’s rights. Given that Courts should stay or dismiss cases pursuant to the Colorado River

Doctrine only in extreme circumstances, and that the balance weighs heavily in favor of the

Court exercising its jurisdiction, the Court concludes that it would not be proper to stay or

dismiss this case. Accordingly, Defendants motions to abate or dismiss are denied.

B. Defendants Have Not Demonstrated This Case Should Be Transferred.

Defendants also argue this case should be transferred to Texas pursuant to 28 U.S.C. §

1404(a). A district court may transfer a civil action to any district where the case could have

been filed originally for the convenience of the parties and witnesses and in the interest of

justice. 28 U.S.C. § 1404(a). A motion to transfer venue under § 1404(a) requires the court to

weigh multiple factors in its determination of whether transfer is appropriate in a particular case. 

For example, the court may consider: (1) the plaintiff’s choice of forum; (2) the convenience of 

witnesses and the parties; (3) the familiarity of the forum with the applicable law; (4) the ease of

access to evidence; and (5) the relative court congestion and time of trial in each forum. See,

e.g., Jones v. GNC Franchising, Inc., 211 F.3d 495, 498-99 (9th Cir. 2000). The general rule is

that the plaintiff’s choice of forum is to be given substantial weight. See Decker Coal, 805 F.2d

at 843. The burden is on the moving party to demonstrate that the action should be transferred. 

Commodity Futures Trading Commission v. Savage, 611 F.2d 270, 279 (9th Cir. 1979). 

Defendants argue this case should be transferred to Texas because the bulk of the

evidence and witnesses are located there. However, the evidence and witnesses on which

Defendants rely only seem to be relevant to the underlying dispute between True and Click

Here, rather than the contract dispute between Tribal Fusion and Defendants. (True Mot. at 10;

Click Here Mot. at 12.) As True and Click Here informed the Court, they reached a settlement

regarding their underlying dispute and all the claims between them. Therefore, this case should

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not focus much, if at all, on the dispute between True and Click Here. On the other hand, Tribal

Fusion points to witnesses and evidence located in Emeryville which is relevant to its contract

dispute with Defendants. (Opp. Br. at 12-13.) 

Given the general rule that the plaintiff’s choice of forum is to be given substantial

weight, and Defendants’ failure to demonstrate that the convenience of witnesses and the parties

or the ease of access to evidence tips in favor of transferring this case to Texas, the Court

concludes that Defendants have not met their burden to show that this case should be

transferred. Accordingly, the Court denies Defendants’ motions to transfer.

CONCLUSION

For the foregoing reasons, the Court DENIES True’s and Click Here’s motions to abate,

dismiss, or transfer.

IT IS SO ORDERED.

Dated: August 12, 2005 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

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