Smith v. Midwest Tape, LLC

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United States District Court
Northern District of California
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
KEVIN SMITH, et al.,
Plaintiffs,
v.
MIDWEST TAPE, LLC,
Defendant.
Case No. 24-cv-08805-JD
ORDER RE TRANSFER
Plaintiffs Kevin Smith and Lyly Tran filed this consumer privacy class action against
defendant Midwest Tape, LLC d/b/a Hoopla. Midwest Tape hosts a “web-based library service,
hoopladigital.com,” which plaintiffs used to borrow reading and video materials from public
libraries in California. Dkt. No. 33 ¶¶ 1, 7, 17. Plaintiffs allege that Midwest Tape illegally
shared information about their reading and video-viewing preferences with third parties Meta
Platforms and Google, in violation of the California Invasion of Privacy Act, Cal. Penal Code
§ 631; California Civil Code § 1799.3; and the California Constitution. Id. ¶¶ 132-71.
Defendant Midwest Tape asked to compel the arbitration of plaintiffs’ claims on an
individual basis. Dkt. Nos. 26, 43. The arbitration demand is based on a dispute resolution clause
in Midwest Tape’s 2021 Terms and Conditions of Use (TOU), which Midwest Tape says is
binding for both plaintiffs. Plaintiffs do not dispute that they accepted the Terms of Use, and they
do not challenge the validity of the TOU other than to raise unconscionability challenges to the
arbitration agreement specifically. Dkt. Nos. 35, 43.1
The TOU applies to “all HOOPLA websites, applications, and associated services and
properties,” which are collectively referred to as “the ‘Platform.’” Dkt. No. 26-1 at ECF p. 9. It
1 Plaintiffs’ opposition briefs have a section heading that reads “Defendant’s Forum Selection
Clause Is Void,” but the ensuing arguments are specific to arbitration being conducted in Lucas
County, Ohio, and not to the issue of arbitrability being resolved by a court there. Dkt. No. 35 at
12-13; Dkt. No. 45 at 14.
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United States District Court
Northern District of California
states that, “[b]y installing or otherwise using the Platform,” users acknowledge that they have
“read and understand these Terms, and agree to be bound by them.” Id.
Section XII of the TOU is titled “Governing Law and Jurisdiction,” and it provides in
relevant part:
You agree to resolve any claims relating to the Platform, software
for or associated with the Platform, and/or Content through final and
binding arbitration before a single arbitrator in Lucas County, Ohio,
USA. The American Arbitration Association (AAA) will administer
the arbitration under its Commercial Arbitration Rules and the
Supplementary Procedures for Consumer Related Disputes. Any in-
person arbitration proceedings shall occur in Lucas County, Ohio,
unless the arbitrator determines that another, mutually convenient
arbitration forum is required by applicable law. By accessing the
Platform you agree to submit to the jurisdiction of the State of
Ohio and agree that Lucas County, Ohio shall serve as the
exclusive venue for any disputes relating to the Platform,
software for or associated with the Platform, and/or Content.
You may only resolve disputes with Midwest Tape on an individual
basis, and may not bring a claim as a plaintiff or a class member in a
class, consolidated, or representative action. Class arbitrations, class
actions, private attorney general actions, and consolidation with
other arbitrations are not allowed.
Id. at ECF p. 14 (emphasis added).
The forum selection clause designating Ohio as the “exclusive venue” of all disputes is
independent of the agreement to arbitrate, and encompasses disputes about arbitrability.
Consequently, the Court invited the parties to address why the case should not be transferred to the
Northern District of Ohio pursuant to the forum selection clause, or simply stipulate to a transfer.
Dkt. No. 57.
The parties’ responses were unhelpful. Midwest Tape used the invitation to dwell on
arbitration, and eventually said it “does not oppose” transfer and acknowledged that a transfer
would be permissible. Dkt. Nos. 58, 61. Plaintiffs suggested that Midwest Tape waived the forum
selection clause, Dkt. No. 59, but relied on readily distinguishable cases cases in which waiver
was found on the basis of extensive litigation. See, e.g., Media Matters for America v. X Corp.,
No. 25-2463, 2025 WL 3688854, at *2 (9th Cir. Dec. 19, 2025) (Media Matters waived right to
exercise forum selection clause designating the Northern District of California where Media
Matters “actively litigated the case on other grounds in Ireland” for over a year “using other
theories,” necessitating the parties to submit “hundreds of pages of affidavits and other evidence”
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United States District Court
Northern District of California
in the Ireland litigation); E. & J. Gallo Winery v. Encana Energy Servs., Inc., 388 F. Supp. 2d
1148, 1164 (E.D. Cal. 2005) (“it would be unfair in the extreme to Gallo to now invoke the forum
selection clause after so much of the parties’ (not to mention the court’s) time and effort has been
expended in discovery, the settlement of discovery disputes, and the resolution of pretrial
dispositive and non-dispositive motions.”).
None of these circumstances are present here. The case is at the very earliest stage of
litigation. All that is pending is Midwest Tape’s requests to compel arbitration, and Midwest Tape
has represented that it “has not served discovery on Plaintiff [sic] in this case in order to avoid
waiver of its rights to arbitration.” Dkt. No. 60 at ECF pp. 3-4. Overall, the record establishes
that Midwest Tape has not “exerted a significant amount of energy” litigating the case in this
District, Hill v. Xerox Business Services, LLC, 59 F.4th 457, 473 (9th Cir. 2023), and so has not
waived the forum selection clause.
When there is a contractually valid forum selection clause, “a district court should
ordinarily transfer the case to the forum specified in that clause.” Atlantic Marine Construction
Co., Inc. v. U.S. Dist. Court for W.D. Tex., 571 U.S. 49, 62 (2013). A valid forum selection clause
is to be given “controlling weight in all but the most exceptional cases,” and plaintiffs here have
not established that “transfer to the forum for which the parties bargained is unwarranted.” Id. at
63.
The parties here agreed in a valid contract that “any disputes relating to the Platform” are
to be exclusively resolved in Lucas County, Ohio. Pursuant to 28 U.S.C. § 1404(a), the case is
ordered transferred to the United States District Court for the Northern District of Ohio.
IT IS SO ORDERED.
Dated: February 20, 2026
JAMES DONATO
United States District Judge
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