induced into signing the indemnity agreement. They also claim
that SOPA, Charterhouse, the Bank, Trujillo, and Blitstein are
indispensable parties to this action.
1. Personal jurisdiction
Jurisdiction by consent satisfies constitutional requirements
of due process, National Equipment Rental, Ltd. v. Szukhent,
375 U.S. 311, 84 S.Ct. 411, 11 L.Ed.2d 354 (1964), and will be
enforced unless it would be unreasonable or unjust to do so.
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 n. 14, 105
S.Ct. 2174, 2182 n. 14, 85 L.Ed.2d 528 (1985). A clause
consenting to a given jurisdiction will be invalidated only if it
was the product of fraud or overreaching, or if the agreed forum
is so inconvenient as to deprive the litigant of his day in
court. The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 18, 92
S.Ct. 1907, 1917, 32 L.Ed.2d 513 (1972); Bense v. Interstate
Battery System of America, Inc., 683 F.2d 718, 721-22 (2d Cir.
1982). Failure to negotiate or explain the terms of an agreement
does not constitute such fraud, overreaching or unconscionability
as to void such a clause. Richardson Greenshields Securities,
Inc. v. Metz, 566 F. Supp. 131, 133 (S.D.N.Y. 1983).
The Fraschs claim that the forum selection clause was the
product of fraud. They state that Trujillo and Blitstein had them
sign the indemnity agreement, and later filled it out on their
behalf, without informing them that they were applying for a bond
to guarantee their credit. Presumably, Trujillo and Blitstein
also did not inform them that the indemnity agreement contained a
forum selection clause.
The Fraschs, however, do not allege that they were prevented by
National Union, Trujillo or Blitstein from reading the indemnity
agreement they signed. Thus, even assuming that Trujillo and
Blitstein did not inform them that they were signing an indemnity
agreement, they could have discovered the forum selection clause
by simply reading the agreement. See National Union v. Hubl, 87
Civ. 8841, slip op. at 6, 1988 WL 108437 (S.D.N.Y. Oct. 4, 1988).
Accordingly, defendants have failed to establish that their
consent to jurisdiction in the indemnity agreement was procured
by fraud. Thus, their consent is valid and enforceable, and this
court has personal jurisdiction over them.
The federal venue statute provides that in a diversity action,
venue lies "in the judicial district where all plaintiffs or
defendants reside, or in which the claim arose."
28 U.S.C. § 1391(a). Although the Fraschs reside in Colorado and "[a]
corporate plaintiff is for venue purposes a resident only in
the state in which it is incorporated," Rosenfeld v. S.F.C.
Corp., 702 F.2d 282, 283 (1st Cir. 1983) (emphasis in original),
"individuals are free to regulate their purely private disputes
by means of contractual choice of forum." Red Bull Associates v.
Best Western International, Inc., 862 F.2d 963, 967 (2d Cir.
Having consented to jurisdiction in this court, the Fraschs
have also consented to venue here. See 15 Wright & Miller 2d,
Federal Practice & Procedure, § 3803.1, p. 17 (to the extent
forum selection clauses are enforced, they control the place of
Accordingly, venue is proper here.
Since venue is proper here, the Fraschs' motion to transfer is
governed by 28 U.S.C. § 1404(a).*fn2 That section provides: "For
the convenience of parties and witnesses, in the interest of
justice, a district court may transfer any civil action to any
other district or division where it might have been brought."
The threshold question is whether the action could have been
brought in the transferee forum in the first place. Schutte v.
Armco Steel Corp., 431 F.2d 22
(3d Cir.), cert. denied, 401 U.S. 910, 91 S.Ct. 871, 27 L.Ed.2d
808 (1970). The Fraschs are Colorado residents. National Union
sues for over $10,000.*fn3 Thus, since citizenship is diverse,
there is federal subject matter jurisdiction, 28 U.S.C. § 1332,
and venue in the District of Colorado where the Fraschs reside
would be proper under 28 U.S.C. § 1393(a).
The note did not establish New York as the exclusive forum for
litigation, but rather as a permissible forum, leaving the action
subject to transfer. Credit Alliance Corp. v. Crook,
567 F. Supp. 1462, 1464-65 (S.D.N.Y. 1983); Coface v. Optique Du
Monde, Ltd., 521 F. Supp. 500, 507 (S.D.N.Y. 1980).
As movants, the Fraschs bear the burden of establishing the
propriety of transferring this case. Factors Etc., Inc. v. Pro
Arts, Inc., 579 F.2d 215, 218 (2d Cir. 1978), cert. denied,
440 U.S. 908, 99 S.Ct. 1215, 59 L.Ed.2d 455 (1979). The pertinent
factors to be considered in determining whether transfer is
(1) the convenience of the parties; (2) the
convenience of material witnesses; (3) the
availability of process to compel the presence of
unwilling witnesses; (4) the cost of obtaining
willing witnesses; (5) the relative access to sources
of proof; (6) where the events at issue took place;
(7) the practical problems indicating where the case
can be tried more expeditiously and inexpensively;
and (8) the interests of justice in general.
Cain v. New York State Board of Elections, 630 F. Supp. 221, 226
(E.D.N.Y. 1986); see also Schneider v. Sears, 265 F. Supp. 257,
263 (S.D.N.Y. 1967).