• July 6, 2015

CatAndMouseChaseJeorenMoeszMichael Gordon was a Fair Isaac executive who left Fair Isaac to become C.E.O. of a direct competitor in England. Fair Isaac sued Mr. Gordon and his new company, Callcredit Information Group, Ltd., which is located in England. Mr. Gordon had signed Fair Isaac’s non-disclosure and non-solicitation agreements to protect Fair Isaac’s confidential and proprietary information and also its “human capital” (that is, Fair Isaac employees in whom Fair Isaac invested time and money in training). Fair Isaac believes that Mr. Gordon violated these agreements. So Fair Isaac sued Mr. Gordon in U.S. District Court for the District of Minnesota.

But the mouse got away — for now, at least.

Fair Isaac had Mr. Gordon sign a waiver of personal jurisdiction so that Fair Isaac could be sure to enjoy a Minnesota forum for any lawsuit against Mr. Gordon in connection with his employment with Fair Isaac. However, as all civil litigators know that Fair Isaac could not have Mr. Gordon agree to subject matter jurisdiction in U.S. federal court.

There is no way to “agree” to subject matter jurisdiction any more than two professional sports teams could, between themselves, agree to play a game in someone else’s stadium or could agree to have a U.S. District Court Judge to be their referee. It just can’t work that way. So what should Fair Isaac have done?

First, it should be noted that Mr. Gordon had been living in Connecticut before he decamped to the U.K. and it would have taken an awfully good bit of forethought to predict that U.S. Judge Joan N. Ericksen would sniff out the subject matter jurisdiction problem (and then refuse to permit jurisdictional discovery, as well). Note that counsel for Mr. Gordon failed to raise the defense of lack of subject matter jurisdiction initially. (See Order at page 11.) (No matter. The Court can and is obligated to raise the issue on its own if no one else noticed the problem.)

Having said that, one might wonder why Fair Isaac did not file their lawsuit in Minnesota state court (though we can recognize that there are many advantages to federal court) (less congested dockets, better-supported judges, greater judicial expertise (as a general matter), easier cross-state-border civil procedure).

Or maybe that is “Plan B”?

 

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