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Brown v. Group, Inc.

United States District Court, S.D. New York

October 28, 2014

ALVIN S. BROWN, Plaintiff,
WEB.COM GROUP, INC., Defendant

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[Copyrighted Material Omitted]

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Alvin S. Brown, Plaintiff, Pro se, New York, NY.

For, Defendant: Jason Mark Koral, LEAD ATTORNEY, Cooley LLP, New York, NY.

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Edgardo Ramos, United States District Judge.

Alvin S. Brown (" Plaintiff" ), proceeding pro se, brings suit against Group, Inc. (" Defendant" ) for injuries stemming from Defendant's deletion of a website owned by Plaintiff and all of the site's content. Defendant, a Delaware Corporation headquartered in Jacksonville, Florida, provides domain name registration, website hosting, and internet marketing services.[1] Plaintiff is a New York resident who contracted with Defendant and Defendant's predecessors in interest to host several websites related to his business as a tax expert and attorney. Plaintiff alleges that in the aftermath of a billing dispute, Defendant, without notifying Plaintiff, irrevocably deleted one of those websites and its data, causing significant financial harm. Defendant now moves to dismiss the complaint pursuant to Rules 12(b)(2) and 12(b)(3) of the Federal Rules of Civil Procedure, arguing that this Court lacks personal jurisdiction over Defendant and is the improper venue in light of a valid and binding forum selection clause. For the reasons discussed below, the motion to dismiss for lack of personal jurisdiction is DENIED. However, the motion to dismiss for improper venue is GRANTED.

I. Background

As 12(b)(2) and 12(b)(3) motions are " inherently . . . matter[s] requiring the resolution of factual issues outside of the pleadings," courts may rely on additional materials when ruling on such motions. John Hancock Prop. & Cas. Ins. Co. v. Universale Reinsurance Co., No. 91 Civ. 3644 (CES), 1992 WL 26765, at *1 n. 1 (S.D.N.Y. Feb. 5, 1992); see also Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005). The following facts, drawn from the complaint and parties' submissions regarding Defendant's motion to dismiss, are construed in the light most favorable to the Plaintiff. Yellow Page Solutions, Inc. v. Bell A. Yellow Pages Co., No. 00 Civ. 5663 (MBM), 2001 WL 1468168, at *1 (S.D.N.Y. Nov. 19, 2001) (citing CutCo Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986); Pilates, Inc. v. Pilates Inst., Inc., 891 F.Supp. 175, 178 n.2 (S.D.N.Y. 1995)).

A. The Conflict

On June 30, 1998, Plaintiff registered with Network Solutions, a domain name registration service, to host the website (" OIC website" ). Pl.'s Opp'n Ex. E.[2] Network Solutions was later acquired by Defendant, which also owned Interland, Inc. (" Interland" ), another website hosting service, and Defendant transferred " hosting" of the OIC website from Network Solutions

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to Interland. Id. at 1.[3] In addition to the OIC website, Plaintiff owned several other websites, including, for which he retained Defendant's internet marketing services. Compl. ¶ III.C. The conflict at hand arose in approximately November 2013, when Plaintiff contested a charge for those services, which, allegedly, Defendant never actually performed. Id. Defendant refused to refund Plaintiff, who therefore directed his credit card company to " charge back" a portion of the fees to his account. Id.

In or around November 2013, Defendant ceased hosting the OIC website and, without notice to Plaintiff, irretrievably deleted the " valuable and proprietary data" stored on the site. Id. Plaintiff found out about the deletion when he contacted Defendant on December 31, 2013 to offer payment for approximately $88 of hosting fees in arrears. Id. At that time, Defendant's employees explained that the site and data had been deleted and could not be restored. Id.

When active, the website helped generate referrals responsible for much of Plaintiff's income as a tax expert specializing in " offers in compromise," Compl. ¶ V, a process of settling tax debt with the Internal Revenue Service (IRS) for less than the full amount owed. See IRS, " Offer in Compromise," (last visited Oct. 14, 2014). As a result of the OIC website's age, it received favorable placement in search engine inquiries about offers in compromise. Compl. ¶ V. Consequently, Defendant's deletion of the website and data has caused the loss of " most of Plaintiff's gross income." Id.

B. The Relevant Forum Selection Clause

Several years before this dispute, in 2011, Defendant implemented an updated Master Service Agreement (" Service Agreement" ) including the forum selection clause that Defendant claims applies to this action. Shutterly Decl. ¶ 9h.[4] Paragraph 16 of the Service Agreement, titled " Governing Law and Venue," declared in relevant part: " Customer agrees that any judicial proceeding relating to or arising out of this Agreement or the Services shall be instituted only in a federal or state court of competent jurisdiction in Duval County in the State of Florida." Shutterly Decl. Ex. A.[5] Defendant informed its customers of the new Service Agreement by posting a large banner message, linked to the Agreement, at the top of its login page

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for existing customers. Id. ¶ 9(i). The banner message stated that, in order for customers to access their accounts, they would first have to review and approve Defendant's new Terms of Service. Id. Indeed, customers could not access their accounts until they had done so. Id. Plaintiff (or his representative or agent)[6] reviewed and accepted the terms of the Service Agreement on May 8, 2011. Id. ¶ ¶ 9(j)-(k). Subsequent emails ...

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