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Keywords

lawsuittortplaintiffstatuteappealmotionstatute of limitations

plaintiffappealmotion

Related Cases

Spar, Inc. v. Information Resources, Inc., 956 F.2d 392, 60 USLW 2618

Facts

Spar, Inc. and Spar Marketing Services, Inc. developed software for evaluating marketing success. They filed a lawsuit against Information Resources, Inc. (IRI) after a former employee, Thomas E. Dailey, left Spar to work for IRI, allegedly breaching a non-competition clause. Spar filed the action in New York state court over five years after Dailey's departure, which was beyond New York's three-year statute of limitations for tortious interference claims. IRI removed the case to federal court and moved to dismiss based on the statute of limitations, while Spar sought to transfer the case to Illinois, where the statute of limitations was five years.

Spar's sole contention on appeal is that the district court erred in concluding that a transfer to the Northern District of Illinois was not warranted under § 1406.

Issue

Did the district court err in denying Spar's motion to transfer the case to the Northern District of Illinois under 28 U.S.C. § 1406?

The sole issue on appeal is whether the district court erred by refusing to grant Spar's motion for a transfer of venue to the Northern District of Illinois, pursuant to 28 U.S.C. § 1406.

Rule

28 U.S.C. § 1406(a) allows a district court to transfer a case to another district where it could have been brought if the case is filed in the wrong division or district, or if it is in the interest of justice.

Section 1406(a) provides: The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought.

Analysis

The court analyzed whether a transfer was warranted under § 1406, noting that while the statute should be read broadly, it should not be used to reward a plaintiff for a lack of diligence. The court found that Spar had ample opportunity to file within the limitations period and that allowing a transfer would essentially permit forum shopping, which is contrary to the interests of justice.

Upon reviewing the facts, we conclude that allowing a transfer in this case would reward plaintiffs for their lack of diligence in choosing a proper forum and thus would not be in the interest of justice.

Conclusion

The Court of Appeals affirmed the district court's dismissal of Spar's complaint, concluding that the denial of the transfer was appropriate given Spar's lack of diligence in pursuing their claim.

Based on the foregoing, we affirm the judgment of the district court dismissing the action.

Who won?

Information Resources, Inc. prevailed in the case because the court upheld the dismissal of Spar's complaint based on the statute of limitations.

Spar now brings this appeal.

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