Case Name:??? Podway Ltd. v. Lars Herold, et al.
Case No.:??????? 16-CV-300577
- Background
??????????? This lawsuit arises from a dispute over trade secrets ? including technological, financial, and strategic information ? generated in the early stages of the development of a self-driving car business.? (First Amended Complaint (?FAC?), ? 21.)
According to the allegations in the FAC, non-party Jonathon Seally (?Seally?), who founded plaintiff Podway Ltd., met defendant Lars Herold (?Herold?) while both worked for another company on a railway transportation project.? (FAC, ? 12.)? In 2015, after Seally and Herold finished working on the railway project, they started working on the launch of a self-driving car business.? (FAC, ? 20.)? Seally had been working on the concept for his ?Podway System? since 2005, and he reluctantly allowed Herold to join his venture despite Herold?s poor record as an entrepreneur.? (FAC, ?? 13, 20.)
Seally and Herold prepared confidential and proprietary designs, budgets, a business plan, a deck of PowerPoint presentation slides (the ?Deck?), and other development information so they could solicit investments from venture capitalists in Silicon Valley and launch their self-driving car business.? (FAC, ??21.)? Seally and Herold met with defendant Mark Seeger (?Seeger?), a partner at defendant Highland Capital Partners (?HCP?), at HCP?s office in Palo Alto, California.? (FAC, ? 22.)? Herold embarrassed Seally at the meeting and left for vacation, leaving Seally to cover the remaining investor meetings in Silicon Valley.? (FAC, ?? 23-25.)? Seally wanted to cut Herold out of the business to appease potential investors, which led to a confrontation when Herold demanded more equity in the business upon his return.? (FAC, ?? 26-28.)? The parties could not resolve their dispute over equity, and so they went their separate ways.? (FAC, ?? 28-32.)
Herold started his own self-driving car business based on the Podway System, defendant Green Light Group PTE Ltd. (?GLG?), and began soliciting investments.? (FAC, ?? 28-31.)? Seally, unaware of Herold?s new venture, officially formed Podway Ltd. based on the same technology and ideas.? (FAC, ? 32.)? In August 2016, Herold purportedly admitted to misappropriating Seally?s concept and offered him an interest in GLG.? (FAC, ?? 33-34.)? Seally countered this offer by requesting that Herold stop operating his competing business.? (FAC, ??35.)? Herold refused, and so plaintiff Podway Ltd. (?Podway?) filed this trade-secrets lawsuit.
Podway asserts a cause of action against Herold, GLG, Seeger, and HCP for misappropriation of trade secrets and a cause of action against Herold alone for breach of his oral nondisclosure agreement.
Previously, the Court granted GLG?s motion to quash service of summons on the ground of lack of personal jurisdiction and dismissed it from the action.? Currently before the Court is a motion by Herold and Seeger (collectively, ?Defendants?) to quash service of summons on the ground of lack of personal jurisdiction, or in the alternative, to stay or dismiss the action on the ground the forum is inconvenient.? Podway opposes the motion and objects to portions of Defendants? evidence.
- Objections to Evidence
Podway filed fourteen objections to portions of the declaration of Lars Herold and an exhibit attached thereto.? Objection Nos. 1-6, 8, and 10, directed to paragraphs 5, 13-14, 25, 31, and 33-35, are OVERRULED because Herold adequately establishes personal knowledge sufficient to lay the foundation for this evidence.? Objection Nos. 7, 9, and 11-13, directed to paragraphs 34 and 36-38, are SUSTAINED because these statements are improper lay opinions.? (See Morrow v. Los Angeles Unified School Dist. (2007) 149 Cal.App.4th 1424, 1444-45.)? Objection No. 14 is SUSTAINED because the spreadsheet attached as Exhibit A is hearsay.[1]? (See Pajaro Valley Water Management Agency v. McGrath (2005) 128?Cal.App.4th 1093, 1107, citing Code Civ. Proc., ???2009, 2015.5.)
III.?????? Motion to Quash
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- Legal Standard
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A defendant may move to quash service of summons on the ground the court lacks personal jurisdiction over him or her.? (Code Civ. Proc., ? 418.10, subd. (a)(1).) When a defendant challenges personal jurisdiction by filing a motion to quash, ?the plaintiff has the burden of proving, by a preponderance of the evidence, the factual bases justifying the exercise of jurisdiction.?? (ViaView, Inc. v. Retzlaff (?ViaView?) (2016) 1 Cal.App.5th 198, 209-10; see also DVI, Inc. v. Superior Court (?DVI?) (2002) 104 Cal.App.4th 1080, 1090.)? To carry this initial burden, the plaintiff must present evidence, such as affidavits, and cannot simply rely on the allegations in the pleading.? (ViaView, supra, 1 Cal.App.5th at p. 210.)? If sufficient evidence is presented, the burden then shifts to the moving party to show the exercise of jurisdiction would be unreasonable. ?(Ibid.)
- Discussion
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Defendants argue the Court lacks general and specific jurisdiction over both Herold and Seeger.? Defendants do not, however, analyze both general and specific jurisdiction with respect to both Seeger and Herold.? Instead, Defendants address only whether the Court may exercise specific jurisdiction over Herold.? Defendants? approach is problematic for several reasons.
First, ?[a] party filing a motion .?.?. must serve and file a supporting memorandum,? which ?must contain a concise statement of facts, a concise statement of law, evidence and arguments relied on, and a discussion of the statutes, cases, and textbooks cited in support of the position advanced.?? (Cal. Rules of Court, rule 3. 1113(a)-(b).)? If a party fails to file a supporting memorandum, a ?court must construe the absence of a memorandum an admission that the motion [?] is not meritorious and cause for its denial, and in the case of a demurrer, as a waiver of all grounds not supported.?? (Cal. Rules of Court, rule 3.1113(a).)? Similarly, ??[w]here a point is merely asserted by counsel [in the memorandum of points and authorities] without any argument of or authority for its proposition, it is deemed to be without foundation and requires no discussion.?? [Citation.]?? (People v. Dougherty (1982) 138 Cal.App.3d 278, 282.)? Furthermore, where a party simply omits an argument, a court will not thereafter consider it for the first time in a reply brief ??because such consideration would deprive the respondent of an opportunity to counter the argument.?? [Citation.]?? (Reichardt v. Hoffman (1997) 52 Cal.App.4th 754, 764.)
Thus, although Defendants are correct that Podway bears the burden of establishing personal jurisdiction, it is Defendants? obligation, in the first instance, to present a memorandum of points and authorities that complies with the California Rules of Court and adequately apprises both the Court and the opposing party of the arguments advanced in support of its overarching position, which must be supported by authority.? While Defendants do take the position that the Court lacks personal jurisdiction over Herold and Seeger, including general and specific jurisdiction, they do not support their position with arguments, authority, and analysis supporting each component of their position.? In other words, Defendants? motion is little more than an open-ended invitation to Podway to establish jurisdiction.? Defendants? approach is incomplete and unpersuasive.? Furthermore, the Court does not consider any new arguments or evidence advanced for the first time in their reply.? Indeed, Defendants attempted to do just that in their reply which caused Podway to appropriately object to the newly submitted evidence.? The Court sustains the objection to all of the new evidence offered by Defendants for the first time with their reply.? [Jay v. Mahaffey (2013) 218 Cal.App.4th 1522, 1537-1538]
Second, as distinct from the issues described above, Defendants jump to analysis of minimum contacts without first articulating that the Court lacks personal jurisdiction based on a traditional ground, such as residency in California.? Under other circumstances, such an omission might be insignificant.? Here, however, Seeger appears to be a California resident and factual assertions made about Herold reflect Defendants may not understand the meaning of the term residency as used in the particular context of personal jurisdiction.? Consequently, it is necessary to address whether the Court may exercise personal jurisdiction on the traditional basis of residency before reaching the merits of the parties? minimum contacts analysis.
- Residency in the Forum
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Although courts and attorneys alike use the term ?residency? when discussing personal jurisdiction, the term has a more specific meaning in that context than it does in everyday use.? (In re Marriage of Obrecht (2016) 245 Cal.App.4th 1, 13-14.)? For purposes of personal jurisdiction, ?residency means domicile [citation], which requires both physical presence and an intent to remain ?indefinitely.??? (Ibid.)? ?While a person may, at any given time, have more than one residence, he or she may have only one domicile at a time.?? (In re Marriage of Tucker (1991) 226 Cal.App.3d 1249, 1258.)? ?Moreover once a domicile has been established, it is presumed to continue until a new one has been acquired.?? (Ibid.)
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Defendants state ?Herold is a German national by birth, and has been a legal resident of Australia for 12 years, residing in Sydney.?? (Mem. of Pts. & Auth. at p. 1:21-22.)? But this statement, without further explanation, does not clearly show Herold?s domicile.? Notably, it is unclear how his place of birth is germane at all.? (See, e.g., Blythe v. Ayres (1892) 96 Cal. 532, 560 [place of birth is immaterial to determining domicile of child].)
In any event, because the evidence reflects Herold resides in Australia, not California, and there is no evidence he ever intended to remain in California indefinitely, Herold?s domicile is not in California.? (Herold Decl., ? 3.)? For purposes of personal jurisdiction, Herold is a nonresident.
In their memorandum of points and authorities and reply, Defendants are silent as to the whereabouts of Seeger.? Defendants do not submit a declaration from Seeger in support of their motion.? The evidence presented by Defendants and Podway shows Mr. Seeger worked at HCP in Palo Alto, California in 2015.? (Herold Decl., ??23; Seally Decl., ? 32.)? Similarly, Seally attests that ?Seeger was a California resident and engineer .?.?. with a technical background in vehicular engineering, namely electronic motorcycles? and he ?was also a venture partner with [HCP] in Palo Alto, California.?? (Seally Decl., ?? 31-32.)? Podway also presents a recent printout of Seeger?s profile from the social-networking website LinkedIn, which identifies Seeger?s location as the ?San Francisco Bay Area? and reflects he worked at HCP in Palo Alto from May 2015 to the present.? (Gaskin Decl., Ex. A.)? In his profile, Seeger states he previously worked at Mission Motorcycles, Inc.? (Gaskin Decl., Ex. A.)? Bankruptcy records from October 2015 for Mission Motorcycles, Inc. reflect its offices were in San Francisco, California.? (Gaskin Decl., Ex. B.)? Also, the schedule of creditors shows Seeger, its president, as having an address of 8 10th Street, #3605 in San Francisco, which is the address for an apartment building.? (Gaskin Decl., Ex. B.)? Podway served Seeger at this apartment in December 2016, following the commencement of this action.? (Gaskin Decl., Ex. C.)? In sum, the evidence reflects Seeger has been physically present in California with the intent to remain here indefinitely.? Seeger is domiciled in California.? Defendants do not present arguments or evidence to support a contrary conclusion.? Accordingly, the Court may exercise personal jurisdiction over Seeger as a resident of this forum.
Having resolved the preliminary issue of whether Defendants are residents of the forum, the Court next considers whether Herold, a nonresident, has sufficient minimum contacts with California to support the exercise of personal jurisdiction.
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- Minimum Contacts
The foundation of the minimum contacts doctrine is California?s long-arm statute, which authorizes ?California courts [to] exercise jurisdiction over nonresidents ?on any basis not inconsistent with the Constitution of this state or of the United States.?? ?(DVI, supra, 104 Cal.App.4th at p.?1089, quoting Code Civ. Proc., ? 410.10.) ??The federal Constitution permits a state to exercise jurisdiction over a nonresident defendant if the defendant has sufficient ?minimum contacts? with the forum such that ?maintenance of the suit does not offend ?traditional notions of fair play and substantial justice.? ?[Citations.]?? ?(DVI, supra, 104 Cal.App.4th at pp. 1089-90, quoting International Shoe Co. v. Washington (1945) 326 U.S. 310, 316.)
??A nonresident defendant may be subject to the general jurisdiction of the forum if his or her contacts in the forum state are ?substantial?.?.?.?continuous and systematic.?? [Citations.]??? (ViaView, supra, 1 Cal.App.5th at p. 209, quoting Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 445.)? Otherwise, if ?the defendant lacks such pervasive forum contacts that [he or she] may [not] be treated as present for all purposes, it is nonetheless proper to subject the defendant to the forum state?s jurisdiction in connection with a particular controversy.?? (ViaView, supra, 1 Cal.App.5th at p. 210.)? A court may exercise this specific jurisdiction if (1)?the defendant ?purposefully availed itself of forum benefits with respect to the matter in controversy,? (2) ?the controversy is related to or arises out of? this contact with the forum, and (3) ?the exercise of jurisdiction would be reasonable and comports with fair play and substantial justice.?? (Id. at p. 216.)
Defendants assert Herold lacks minimum contacts to support the exercise of general jurisdiction but do not support their argument with any analysis.? Nevertheless, Podway does not assert or present evidence showing Herold had substantial, continuous, and systematic contacts with California.? Consequently, there is no basis for the exercise of general jurisdiction over Herold.? The Court next considers whether Herold is subject to specific jurisdiction based on controversy-specific minimum contacts.
Defendants argue ?[s]pecific jurisdiction is lacking because there was no purposeful availment by defendants as to this forum state, and no activity that resulted in any underlying transaction.?? (Mem. of Pts. & Auth. at p. 10:4-5.)? Although Defendants apparently present two separate reasons why specific jurisdiction is lacking, the first reason is simply a conclusion and the second reason is a factual assertion that they do not clearly link to one of the three components of the specific-jurisdiction analysis.? Thus, in the first instance, Defendants? reasoning is not abundantly clear.
Significantly, Defendants do not dispute Herold came to California for business numerous times throughout 2014 and 2015, including to solicit investments from venture capital firms.? (Herold Decl., ?? 15-20, 23-24.)? Herold states he in fact proposed going to Silicon Valley to meet with investors.? (Herold Decl., ? 14.)? Podway?s evidence corroborates these statements.? Seally had experience doing business in Silicon Valley and states Herold agreed it would be beneficial to seek financing and ultimately set-up their business here.? (Seally Decl., ?? 14-15.)?? It is therefore undisputed Herold came to California for the purpose of securing investments in the self-driving car business.
It follows that the parties? dispute is essentially whether courts have recognized the quantity and quality of contacts present here as sufficient to support the exercise of specific jurisdiction.? To this point, it appears Defendants? position is that soliciting investments in Silicon Valley does not constitute purposeful availment of forum benefits unless it resulted in an actual investment or successful business transaction.? Yet, Herold states HCP in fact made an offer to him and Seally, which they subsequently rejected.? (Herold Decl., ? 23.)? In other words, they transacted business beyond preliminary negotiations.? Furthermore, Defendants do not cite any authority espousing such a rule.
In actuality, courts have held soliciting investors constitutes purposeful availment, even if unfruitful.? (See Anglo Irish Bank Corp., PLC v. Super. Ct. (?Anglo Irish Bank?) (2008) 165?Cal.App.4th 969, 981 [defendants visited California to solicit investments from fund managers], citing Snowney v. Harrah?s Entertainment (2005) 35 Cal.4th 1054, 1064-65 [hotels purposefully availed themselves of forum benefits by soliciting business in California].? Herold therefore purposefully availed himself of the benefits of this forum by visiting California specifically to solicit investments from venture capitalists in Silicon Valley.
The second issue is whether the present controversy arises from or relates to Herold?s contacts with California.
In general, ?[a] controversy is related to or arises out of the defendant?s forum contacts, so as to satisfy the second requirement for the exercise of specific personal jurisdiction, if there is ?a?substantial connection?between the forum contacts and the plaintiff?s claim.??? (Anglo Irish Bank, supra, 165 Cal.App.4th at p.?979, quoting Vons Companies, supra, 14 Cal.4th at p.?452.)? ??A claim need not arise directly from the defendant?s forum contacts in order to be sufficiently related to the contact to warrant the exercise of specific jurisdiction.??? (Anglo Irish Bank, supra, 165 Cal.App.4th at p.?979, quoting Vons Companies, supra, 14 Cal.4th at p.?452.)? ??Rather, as long as the claim bears a substantial connection to the nonresident?s forum contacts, the exercise of specific jurisdiction is appropriate.??? (Anglo Irish Bank, supra, 165 Cal.App.4th at p.?979, quoting Vons Companies, supra, 14 Cal.4th at p.?452.)
Defendants? position on the relationship between Herold?s contacts and the controversy is not particularly clear.? Defendants generally assert Herold did not actually misappropriate or disseminate trade secrets in California and appear to advance this point to show there is no connection between the injury alleged and Herold?s visits to the forum.? (Mem. of Pts. & Auth. at p. 12:6-11.)? But ?it is obvious that [Podway] is?not?required?to?prove?the allegations of its [?] complaint in order to establish that jurisdiction is proper in this forum.?? (Vons Companies, supra, 14 Cal.4th at p.?460.)? ?The forum contacts need not be the proximate cause or ?but for? cause of the alleged injuries.?? (Anglo Irish Bank, supra, 165 Cal.App.4th at p.?979.)? ?The forum contacts also need not be ?substantively relevant? to the cause of action, meaning those contacts need not establish or support an element of the cause of action.?? Consequently, Podway need not prove trade secret misappropriation or theft occurred during one of Herold?s trips to California or even that these meetings somehow caused Herold to engage in misconduct after the fact.
Here, there is a substantial connection between the trade secrets at issue and Herold?s contacts with California because the parties developed the trade secrets at issue and compiled them into the Deck for the express purpose of soliciting investments from venture capitalists in Silicon Valley.? (Herold Decl., ?? 13-16.)? This is neither disputed by the parties nor surprising given this region?s moniker and reputation for innovation.? Furthermore, the parties? dispute arises from Herold?s contacts with California because the meetings in Silicon Valley triggered the rift in the business relationship and the decision by Herold and Seally to launch competing businesses based on the same trade secrets.? (See Herold Decl., ?? 17-18, 23-26; Seally Decl., ???38-40.)
In sum, regardless of whether the original seed for the business plan sprouted in Australia or where Herold was when he officially stole the trade secrets, the trade secrets include technical, financial, and strategic information developed explicitly for the purpose of and in the course of Herold?s attempts to court investors in Silicon Valley.? This connection is sufficient to support the exercise of specific jurisdiction.
Defendants do not clearly advance any other arguments.? They do state in a conclusory manner that ?California simply ?lacks interest in a contract dispute between Texas residents where there was no untoward effect here.?? Stone v. State of Texas (1999) 76 Cal.App.4th 1043, 1050.?? (Mem. of Pts. & Auth. at p. 12:11-13.)? Defendants do not explain, however, how the case they cite is relevant or applicable here.? The plaintiff in Stone sought to establish jurisdiction based solely on the fact that he lived in California when he received a letter from a head hunter recruiting physicians to work at a teaching hospital in Texas, and despite the fact that he subsequently relocated to Texas to work at the hospital.? (Stone, supra, 76 Cal.App.4th at pp.?1046-47.)? Stone simply is not analogous to the circumstances here and does not support the conclusion that the Court lacks specific jurisdiction.
For the reasons set forth above, Podway carries its initial burden of demonstrating Herold has controversy-specific minimum contacts sufficient to support the exercise of specific jurisdiction.? Thus, it is incumbent upon Defendants to show the exercise of jurisdiction would be unreasonable.? To carry this burden, Defendants ??must present a compelling case that the presence of some other considerations would render jurisdiction unreasonable.??? (Anglo Irish Bank, supra, 165 Cal.4th at pp.?979-80, quoting Burger King Corp. v. Rudzewicz (1985) 471?U.S. 462, 477.)? Defendants, however, neglect to address this issue and it is not otherwise obvious the exercise of jurisdiction would be unreasonable here, particularly given the local defendants and activities at issue in this case.? Defendants therefore fail to carry their burden.
Based on the foregoing, the motion to quash service of summons for lack of personal jurisdiction as to both Herold and Seeger is DENIED.
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- Motion to Stay or Dismiss
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??????????? Alternatively, Defendants move to stay or dismiss this action on the ground California is an inconvenient forum.? They argue Podway?s claims should be litigated in an ongoing Australian lawsuit brought by Herold and GLG against Seally and Podway.
- Legal Standard
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?The doctrine of forum non conveniens, established in California by judicial decision [citations], is codified in Code of Civil Procedure section 410.30.?? (Archibald v. Cinerama Hotels (1976) 15 Cal.3d 853, 857, original italics.) ??This section provides that ?When a court upon motion of a party [?] finds that in the interest of substantial justice an action should be heard in a forum outside this state, the court shall stay or dismiss the action in whole or in part on any conditions that may be just.??? (Ibid., quoting Code Civ. Proc., ? 410.30, subd. (a).)
??A case-by-case examination of the parties, their dispute and the relationship of each to the state of California is the heart of the required analysis.??? (Fox Factory, Inc. v. Super. Ct. (2017) 11 Cal.App.5th 197, 203, quoting Nat. Football League v. Fireman?s Fund Insurance Co. (2013) 216 Cal.App.4th 902, 921.)? The California Supreme Court has enumerated the two steps of ?analysis for a court considering a forum non conveniens motion.?? (Fox Factory, supra, 11 Cal.App.5th at p.?203.)? ?The court ?must first determine whether the alternate forum is a ?suitable? place for trial.??? (Ibid., quoting Stangvik v. Shiley, Inc. (1991) 54 Cal.3d 744, 751.)? ??If it is, the next step is to consider the private interests of the litigants and the interests of the public in retaining the action for trial in California.??? (Fox Factory, supra, 11 Cal.App.5th at p.?203, quoting Stangvik, supra, 54 Cal.3d at p.?751.)? ?The burden of proof is on the defendant, as the party asserting forum non conveniens.?? (Fox Factory, supra, 11 Cal.App.5th at p.?204.)
- Discussion
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??????????? For the reasons set forth below, Defendants do not substantiate their motion.
First, Defendants do not address whether Australia is a suitable alternative forum.? While this is a sufficient basis for denying their motion, the record also affirmatively reflects Australia is not a suitable alternative forum.
?The Judicial Council comment to?[Code of Civil Procedure] section 410.30?declares in part, ?[?] the suit will be entertained, no matter how inappropriate?the forum may be, if the defendant cannot be subjected to jurisdiction?.?.?.?.??? (Stangvik, supra, 54 Cal.3d at p.?752.)
Here, there is no basis for concluding Seeger and HCP will be subject to personal jurisdiction in Australia.? Incidentally, the Australian court presiding over Herold?s Australian lawsuit made a similar observation in a recent order.? For context, in the Australian lawsuit, Herold and GLG assert claims for cancellation of trademarks registered in Australia, substitution of Herold as the owner and registrant of the trademarks, an injunction restraining Seally and Podway from threatening to sue for copyright infringement, and a declaration that using part of the Deck does not constitute disclosure of confidential information.? (Beatty Decl., Ex. A, ? 28.)? Seally and Podway sought a stay of the Australian proceedings, and Herold and GLG simultaneously sought an anti-suit injunction to restrain Podway from prosecuting the lawsuit here.? (Beatty Decl., Ex. A, ? 32.)? In denying both applications, the Australian court considered factors similar to those implicated by the American first-to-file rule and the doctrine of forum non conveniens.? The Australian court observed: ?There are already two other defendants in the California proceedings, namely Mark Seeger and Highland Capital Partners LLC, who have not been shown to be amenable to any cross-claim brought by Podway (and/or Seally) in Australia because there is nothing to connect them to Australia in any way.?? (See Beatty Decl., Ex. A, ??53.)? Put differently, the Australian court expressed skepticism as to whether Seeger and HCP would be subject to its jurisdiction.
In sum, Defendants do not carry their burden of demonstrating Australia is a suitable alternative forum because they do not show Seeger and HCP would be subject to jurisdiction there.? Furthermore, their own evidence affirmatively casts doubt on whether they could make such a showing.? Additionally, even if Defendants could, their analysis of the public and private interest factors for purposes of the second step of the analysis is inadequate.
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??The private interest factors are those that make trial and the enforceability of the ensuing judgment expeditious and relatively inexpensive, such as the ease of access to sources of proof, the cost of obtaining attendance of witnesses, and the availability of compulsory process for attendance of unwilling witnesses.??? (Fox Factory, supra, 11 Cal.App.5th at p.?203, quoting Stangvik, supra, 54 Cal.3d at p.?751.)? ??The public interest factors include avoidance of overburdening local courts with congested calendars, protecting the interests of potential jurors so that they are not called upon to decide cases in which the local community has little concern, and weighing the competing interests of California and the alternate jurisdiction in the litigation.??? (Fox Factory, supra, 11 Cal.App.5th at p.?203, quoting Stangvik, supra, 54 Cal.3d at p.?751.)? ?Also of potential concern is ?the interest in trying the case in a forum familiar with the applicable law, and the interest in avoiding unnecessary conflicts of laws.??? (Fox Factory, supra, 11 Cal.App.5th at p.?203, quoting Stangvik, supra, 54 Cal.3d at p.?751.)
Defendants assert substantially all of the witnesses in this case are based in Australia and the U.K, naming a few individuals.? Presumably, Defendants make this assertion to show the private interest factors weigh in favor of trying this lawsuit in Australia.? Nevertheless, they do not explain who these witnesses are or how they qualify as ?substantially all? of the witnesses in this case.? It is unclear how these witnesses could be substantially all of the witnesses given Herold?s admission that he and Seally met with a far higher number of venture capitalists in Silicon Valley who may be called to testify.? Furthermore, Defendants do not actually address the issue of compulsory process or the cost of obtaining attendance.? Also, Defendants? identification of witnesses in the U.K. does not support the conclusion that Australia is more convenient for that subset of witnesses; Australia is just as remote of a location.
Defendants otherwise assert that they are deeply involved in the Australian litigation.? Defendants do not, however, explain the significance of this point.? Perhaps Defendants? argument is that it would be more convenient to litigate Podway?s claims along with the claims in the Australian lawsuit.? Yet, Defendants do not show the claims are similar such that it would be more convenient and efficient to litigate the claims together, either leading up to or all the way through trial.? Incidentally, in declining to issue an anti-suit injunction, the Australian court observed a judgment in the Australian proceedings would not necessarily dictate the resolution of the proceedings here because the scope of this litigation is much broader than the scope of the Australian litigation and ?there is lacking equivalence of substantive relief as between the two sets of proceedings.?? (Beatty Decl., Ex. A., ? 53.)? Thus, the record before the Court does not support the conclusion that both lawsuits substantially overlap.? It follows that the record does not support the conclusion that litigating the lawsuits separately is inconvenient, is inefficient, or otherwise creates the potential for conflicts in law or rulings.
Additionally, to the extent Defendants intended to make some type of first-to-file argument, these proceedings predate the Australian litigation.? Accordingly, the responsibility for waging this battle on two fronts rests entirely with Herold.
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Finally and most significantly, Defendants do not address any other private interest factors let alone any of the public interests factors.? Thus, their analysis is fatally underdeveloped and insufficient to substantiate their motion.
For the reasons set forth above, the motion to stay or dismiss the action on the ground this is an inconvenient forum is DENIED.
[1] Incidentally, the information in the chart is not material to the disposition of the motion.? Although Defendants reference the chart once, they do not discuss it at length or rely on it to support their legal analysis.