A plaintiff, a citizen of State A, sued a defendant, a citizen of State B, in federal court in State A. The plaintiff sought $100,000 in damages for breach of contract. The defendant filed a motion to dismiss for improper venue, arguing that the defendant resides in State B, and the contract was negotiated and executed in State B. The plaintiff argues that the contract was to be performed in State A. Which of the following is the most likely outcome regarding venue?
- AVenue is proper in State A because federal courts have nationwide venue for diversity cases.
- BVenue is improper in State A because the defendant resides in State B.
- CVenue is proper in State A because a substantial part of the events giving rise to the claim occurred there.
- DVenue is improper in State A because the plaintiff is suing in their home state.
Show answer & explanationAnswer & explanation
Correct answer: C. Venue is proper in State A because a substantial part of the events giving rise to the claim occurred there.
Under 28 U.S.C. § 1391(b)(2), venue is proper in a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated. If the contract was to be performed in State A, that constitutes a 'substantial part of the events' for a breach of contract claim.
Why the other options are wrong
- A. Federal courts do not have nationwide venue for diversity cases; specific rules for venue still apply.
- B. While defendant's residence can establish venue, it's not the only way. The question indicates events occurred elsewhere.
- D. Plaintiff's residence is not a general basis for venue unless it's also where the defendant resides or where substantial events occurred.
General Venue Rule (Substantial Events)
Venue is proper in a judicial district where a substantial part of the events or omissions giving rise to the claim occurred, or where a substantial part of property that is the subject of the action is situated.
- Focuses on where the 'story' of the lawsuit unfolded.
- Does not require the *most* substantial part, just a substantial part.
- One of three primary bases for venue under 28 U.S.C. § 1391(b).
Memory trick: Where's the 'story' of the case located? That's the right address.