Digital Envoy, Inc. v. Google, Inc.
Filing
13
ORDER by Judge Charles A. Pannell DENYING defendant's [6-1] motion to dismiss and GRANTING defendant's [6-2] motion to transfer case. The Clerk is DIRECTED to transfer this action to the USDC for the Northern District of California. (cc) (dfb)
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Case 1:04-cv-00864-CAP
Document 13
Filed 05/21/2004
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CRAM BER.9
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DIGITAL ENVOY, v. GOGGLE, INC .,
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION INC ., CIVIL ACTION N0 .
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Men.
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Plaintiff,
1 :04-CV-0869-CAP
Defendant .
ORDER This emergency matter motion is for now before the court on the No . Nos . plaintiff's 3-1] 6-i, and the
expedited
discovery
[Doc . [Doc .
defendant's motion to dismiss or transfer Factual Background Digital ("Google") Envoy, Inc . to ('Digital two
6-2] .
Envoy")
and
Googie, (1) a
Inc . non-
are
parties
separate
contracts : ("NDA"), and
disclosure agreement dated November 29, Ex . A. to Def .'s Mot . to Dismiss 2000, or
2000
attached as a license 2000 B. to
Transfer ;
(2)
agreement dated November 30, and July 17, 2001 ("license
and amended on December 21, attached as Ex . in
agreement"),
Def .'s Mot . to protect
to Dismiss the
or Transfer .
The NDA was
entered by
order party
confidential
information
disclosed
each
during negotiations . entered into gives
The license agreement the parties ultimately Google a limited, non-exclusive right to use
Digital Envoy's technology, approximate geographic
which enables the determination of the visitor to a website .
location of a
k3
Case 1:04-cv-00864-CAP
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Both the NDA and the license agreement contain forum selection clauses . any Specifically, relating to the NDA provides, this Santa Agreement Clara "The exclusive venue for shall be in the state 1H or 14 .
dispute
federal Likewise, this
courts the
within license
County,
California ." "Any lawsuit federal
agreement filed
provides, in the §
regarding courts in
Agreement
shall be
state or
Santa Clara County, lliqital Envoy
California ." filed this
12 . on March 29, 2604, alleging unfair on
action
claims against Google for misappropriation of trade secrets, competition, and unjust enrichment . Essentially, Jurisdiction is
premised
diversity of citizenship . Google is using its
Digital Envoy contends that the scope of the license
technology beyond
agreement,
by applying it
in areas outside of the Google,
search business maintains
and by sharing
it with third parties .
however,
that its activities are wholly within the scope of the agreement .' Legal Analysis I. The defendant's motion to dismiss or transfer The court first considers Google's motion to dismiss for lack oŁ venue pursuant to Federal Rule of Civil Procedure 12(b)(3) or,
In fact, on April 16, 2009, Google filed an action against Digital Envoy in the United States District Court for the Northern District of California, sec-king, inter alia, a declaratory judgment that it has not used Digital Envoy's technology beyond the scope of the license agreement . 2
Case 1:04-cv-00864-CAP
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in
the
alternative,
to
transfer pursuant to 28
U .S .C .
§
1904!a),
based on application of the agreement = 12(b)(3) At the outset, is
forum selection clause in the license Digital Envoy urges that Google's Rule improper, as 28 U .S .C . § 1404(x)
motion
procedurally
ordinarily controls a party's request to apply a contractual forumselection clause . The court agrees .
Google cites Liacon v . Underwriters at Lloyd' s, London for the proposition that Rule 12(b)(3) cases where venue is lacking is a proper vehicle for disposing of due to the application 1998) . of a forum
selection clause .
148 c^ .3d 1285
(11th Cir .
It is true that upon
the Eleventh Circuit
in Lipcon held that
"motions to dismiss
the basis of choice-of-forum and choice-of-law clauses are properly brought pursuant to Fed .R .Civ .P . improper venue ." Id . at 1290 . 12(b)(3) However, as motions to dismiss for that case concerned an
international forum 1409(x) to give for . .
agreement
in which England was Thus, while
selected as the sole that "28 U .S .C . y
disputes . . controls to
Id . the a
noting
request of a party in a diversity suit forum-selection. clause v. by
effect
contractual id .
transferring the action,"
(citing Stewart Ora .,
Inc .
Ricoh
Googie argues in the alternative that this action is improperly vcnueci based on application of the forum selection The court need not reach this issue, as it clause in the NDA . concludes that the forum selection clause in the license agreement requires a transfer of this action .
3
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Corp . , court
487
U .S .
22, §
32,
108
S.
Ct . could
2239, not
2295 apply
(1988)), because
the Lipcon the case
found
that
1409 (a)
involved a country . In
forum selection clause Id . Rule since 12(b)(3) Lipcon , its
requiring
litigation in another
was therefore applied . courts rule in the Eleventh where Circuit have is
cases
generally
assumed
that
applies
only
transfer
impossible because the in a 259 foreign F .3d country . 1300
forum selection clause requires See, e .g . , Hollis v. Florida
litigation Univ . , the of
State
1295,
n .5
(11th
Cir . to
2001)
(indicating upon the
that basis
Lipcon
court
held
that
"motions
dismiss
choice-of-forum and choice-of-law clauses litigation in another 12(b) (3) country] as are to
[that purportedly require brought for pursuant to
properly dismiss
Fed .R .Civ .P .
motions
improper venue") Rehab . Ga . Servs . 1999) is
(emphasis added) of Columbus, that
(alteration in original) ; 45 F. Supp .2d to in 1375,
Thomas v . 1378
Inc . ,
(M . D .
(stating
where
transfer remedy the
another enforcing and,
federal a forum
forum
appropriate, clause 12(b)(3) is to
the
proper
selection treating a
transfer as a
case, to
accordingly, pursuant Ltd . , to 124
motion
motion
transfer
§
1404(a)) . F. Supp .2d
See also Webster v . 1317, where 1320 the (S . D . Fla .
Royal Caribbean Cruises, 2000)
(restating anti applying the Lipcon rule clause selected another country as the
forum. selection
4
Case 1:04-cv-00864-CAP
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proper 993169,
forum at *5
for (S . C .
disputes) ; Fla . Feb . not
Wai 23, cited,
v. 2004)
Rainbow (same) .
Holdings ,
2009
WL
Indeed, any case extends law to
Google has within actions this in
and this
court has the
not
found, rule is
circuit which
indicating that to the
Ligcon
transfer
proper
forum
practicable . procedural this is,
Accordingly,
the court concludes that the appropriate the forum selection Gooqle's motion will proceed clause in
mechanism is 28
for enforcing U .S .C . §
instance therefore,
1909(x), the court
to dismiss consider
DENIED ;
and
to
Gooqle's motion, in the alternative to transfer this action pursuant to § 1404(x) .
The
clause
determination
in a 28 diversity U .S .C .
of
whether
action i909(a) .
to
is
enforce
governed
a
by
forum
selection
law, at 32, is of
federal 487 U .S .
specifically 108 S. Ct . at
§
Stewart Ora . , of a
2245 . the
The validity usual rules
forum selection clause the v. enforcement Canon USA, case,
determined
under
governing Inc .
contracts in general . 331 F .3d 804, 807
P G S Bus .
Machs .,
Inc . ,
(11th Cir .
2003) .
In the
instant
Digital
Envoy does not contest but, rather,
the validity of the
forum selection clause
argues that the forum selection clause is inapplicable in this action . clause sounding may in
because it does not encompass the claims asserted It apply to is clear that a contractual in tort as forum well
selection as those
claims
sounding
5
Case 1:04-cv-00864-CAP
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contract . 1066, 1070
See,
e .g . , Cir . at
Stewart Cra ., 1987) issue (en
Inc . banc)
v.
Ricoh Corgi , that
810 F .2d the and forum tort S.
(llth clause
(holding both
selection claims), Ct . 2239
encompassed
contract 987 v. U .S .
aff'd and (1988) . 'r' .3d
remanded on other grounds , See also Terra Int'1, inc . 1997)
22,
108
Mississippi Chem . that the tort (M . D .
Corp . ,
119
638,
693-95
(8th Cir .
(concluding
forum selection
clause at
issue encompassed
the plaintiff's 1307-08
claims) ; McNair v . Monsanto Co . , 279 F . Supp .2d 1290, Ga . 2003) (same) Ala . Smith v . 1998) Prof'1 Claims, (same) . Inc . , 19 F .
Supp .2d 1276,
1281-82 by forum
(M . D .
Whether tort claims are governed upon the intention of the
selection
provisions
depends
parties as
reflected by the wording of
the particular clauses and 119 F .3d at 693 ; McNair ,
the facts of each case . 279 F. As Supp .2d at 1307 .
See Terra Int'1 ,
indicated previously,
the forum selection clause at
issue
in this case provides that "[a]ny lawsuit regarding this Agreement shall County, be filed in the state or federal courts in Santa Clara
California ."
License Agreement § 12 .
Gcogie argues that license Google's
the claims asserted it this action certainly "regard" the agreement, as they are all premised on allegations that
current use of Digital Envoy's technology goes beyond the scope of the agreement . Digital Envoy argues, however, that its claims do
not concern the license agreement because the central 6
issue is not
Case 1:04-cv-00864-CAP
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Google's performance under the agreement but,
rather,
its
alleged
tortious and extra-contractual use of Digital Envoy's technology in areas in which it does rot have a More specifically, license .
Digital Envoy contends that this action is
not governed by the forum selection clause because the tort claims it asserts are independent of the license agreement and would exist even if there were no agreement between the parties . is misguided . Google While in the fact Digital Envoy might a assert This argument same claims
the
against the
absence of
contractual in this
agreement between there is an the to
parties,
the
remains that
instance,
agreement ; central
and one of the central
issues
in this
case--if
not
issue in this
case--is whether that
agreement
extends
Google's current Moreover, is not limited,
use of Digital Envoy's
technology .
the forum selection clause in the license agreement as Digital Envoy seems to suggest, to claims that
are dependent upon the agreement or to those that allege breach of the agreement . Rather, it encompasses § 12 . "[a]ny lawsuit regarding
this Agreement ."
License Agreement
Digital Envoy's claims as they regard
in this case clearly "regard" the license agreement,
alleged activities that may or may not be covered by the agreement and, indeed, they will almost certainly fail if Google's use of its found to be within the 810 F .2d at 1070 7 scope of the agreement . See
technology is
also Stewart Cra . ,
!holding that a forum selection
Case 1:04-cv-00864-CAP
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clause
encompassing with
any
"case or
controversy arising included from the "all
under or of
in
connection arising
this or
Agreement" indirectly
causes
action
directly
business
relationship F .S .B . , 288 F . of
evidenced by the contract") ; Supp .2d 1256, 1258 an (N .D .
Bullard v . 2003)
Capital One . (stating, in
cia .
the in
context this
interpreting allowing account,'
arbitration of
clause, legal
"The claim
language . . .
case, your
arbitration is broad .
`any Using I
regarding and a
ordinary read this
English clause to, as
contract broad and The way ;
interpretation grant, under
principles, all or
very
encompassing the account does not not.
actions Agreement the
relating
deriving the
from,
governing of
account . in any
agreement
limit
scope
arbitration
arbitration is
restricted to breach of contract claims or any 196 F . Supp .2d 1007, claims entered had 1011 been an
other class of claim .") ; Cusaro v . Klein , (C,D . Cal . 2002) to with (noting court forum that the
plaintiff's the parties
transferred agreement
that a
because selection
into
clause and of
encompassing consideration the agreement of
"any the a
controversies claims would
regarding require
this Agreement"
both
interpretation
and
determination as to whether it had been repudiated) . Therefore, the court concludes that Digital Envoy's claims are governed by This does the forum selection the matter, clause however, in as the license agreement . of a
not
end
the
application
8
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valid
forum
selection clause
is
not
dispositive
in
considering a 487 U .S . at
motion to transfer under § 1904(a) . 31, 108 S . Ct . at 2295 . Rather,
See Stewart Ora . ,
in such instances,
"the opponent
bears the burden of persuading the court that the contractual forum is sufficiently inconvenient to justify retention of the dispute ." In re Ricoh has Corms . , 870 F .2d 570, 573 so (11th thus Cir . has 19E9) . not is Digital its
Envoy
made
no attempt
to do
and
carried GRANTED .
burden . II .
Accordingly,
Google's motion to transfer
The plaintiff's emergency motion for expedited discovery Because the court determines § that this it action does not must rule be on
transferred
pursuant
to 28 U .S .C .
1409(a),
the plaintiff's pending motion for expedited discovery . Conclusion For the foregoing (1) (2) and (3) States DIRECTS the clerk to transfer this action to the United DENIES reasons, the court hereby : [Doc . [DOC . No . No . 6-ij ; 6-2] ;
the defendant's motion to dismiss
GRANTS the defendant's motion to transfer
District Court
for the Northern District of California . day May, 2004 .
SO ORDERED,
this -
ENTERED «'" POCKET
MAY 2 5 2004
LUTHER D. i HOMAS Deputy Clerk
~HAFLES A . PANNE ~ JR . United States District Judge
9
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