Breach of Contract

Listen to this article

7^th Circuit Court of Appeals

Case Name: Gerald North v. Ubiquity, Incorporated

Case No.: 17-2620

Officials: Rovner, Hamilton, and Scudder, Circuit Judges.

Focus: Breach of Contract

n 2006, Ubiquity, a California-based company, entered into a contract with Associates, a firm based in Illinois and represented by North. The contract, executed by North in Arizona, stipulated that Ubiquity would transfer 1.5% of its outstanding shares to Associates as a commencement fee. However, Ubiquity terminated the agreement shortly after signing it and did not transfer the shares. In 2013, North demanded specific performance and sued Ubiquity for breach of contract in Arizona state court when Ubiquity went public. The Arizona court rejected Ubiquity’s motion to dismiss for lack of personal jurisdiction.

In 2016, concerned about a potential reversal on appeal, North filed an identical breach-of-contract claim in the Northern District of Illinois. Ubiquity did not appear, resulting in a default judgment of $7 million. However, Ubiquity successfully moved to vacate the default judgment and dismiss the case due to lack of personal jurisdiction. The court determined that Ubiquity’s only connection to Illinois was its contract with an Illinois entity, while North himself admitted that the negotiations, execution, and performance of the contract occurred in Arizona. North appealed the decision, but the Seventh Circuit affirmed it. Although the district court could have considered transferring the case to the Central District of California, North’s own statements would have undermined his request for transfer.

Affirmed.

Decided 06/26/23

Full Text