Florida Court Rejects Transfer Request Made After Jurisdictional Game-Playing

A Florida federal court recently denied a request to transfer a case to another forum after having dismissed it for lack of personal jurisdiction over the defendants.  The ruling in Karnas v. Cuban (S.D. Fla. May 27, 2026) was based on the facts that the plaintiffs had taken a “calculated risk” in filing their claims in a jurisdictionally shaky forum and then had opposed the defendants’ request to transfer the case to a forum where jurisdiction unquestionably existed, had continued to litigate their case in Florida for three years after opposing the defendants’ transfer request, had not requested transfer as an alternative to dismissal for lack of personal jurisdiction, and then – after losing a motion to dismiss for lack of personal jurisdiction – had belatedly sought the same transfer they previously had opposed.

The decision illustrates the risks of stretching the limits of personal jurisdiction and then seeking a redo after losing a motion to dismiss.  While filing in a jurisdictionally questionable forum might never be a good idea, plaintiffs who nevertheless choose to do so might wish to protect themselves by requesting transfer as an alternative to dismissal – and should consider the adverse implications of rejecting the defendant’s effort to transfer the case to the same forum that the plaintiffs might later need to request to salvage their claims.

Background

The Karnas decision arose from the bankruptcy of Voyager Digital, LLC, a cryptocurrency-investing platform.  Voyager’s collapse led to a flurry of litigation, including the Karnas class action filed in Miami federal court against Mark Cuban and the Dallas Mavericks. 

Plaintiffs alleged that Mr. Cuban and the Mavericks had promoted Voyager through (i) a press conference that was held in Dallas, Texas, and was livestreamed, (ii) a promotional campaign open to anyone in the country (or the world), (iii) a press release, and (iv) advertisements that were posted at Mavericks home games in Dallas and were visible on nationwide television.  Plaintiffs contended that those promotional efforts violated various consumer-protection statutes as well as the federal securities laws.

From the beginning of the case, Mr. Cuban and the Mavericks disputed the substance of the claims and insisted repeatedly that they were not subject to personal jurisdiction in Florida.

• In November 2022, defendants moved to dismiss for lack of personal jurisdiction and submitted sworn declarations explaining why jurisdiction did not exist in Florida.
• The parties then engaged in several years of jurisdictional discovery, which produced no evidence of defendants’ activities in or directed at Florida.
• In January 2023, defendants’ counsel sent plaintiffs’ counsel a detailed letter explaining why jurisdiction did not lie in Florida and warning them to consider the Rule 11 implications of continuing their suit in that forum.
• Later that month, defendants moved to transfer the case to the Dallas federal court, where jurisdiction unquestionably existed over Mr. Cuban and the Mavericks, but plaintiffs’ counsel said they would oppose the motion.
• In May and June 2023, defendants served and filed a Rule 11 motion based on plaintiffs’ insistence on pursuing jurisdictionally defective claims in Florida.
• In October 2024, the court held a hearing and repeatedly expressed skepticism about plaintiffs’ theory that personal jurisdiction could be obtained over defendants based on nationwide (or worldwide) promotions and social-media posts that had not taken place in or been directed at Florida.
• At no time during that hearing or in their opposition to defendants’ motion to dismiss did plaintiffs ever request transfer to Texas as an alternative to dismissal.

In December 2025, the court granted defendants’ motion to dismiss and held that the record showed no Florida-directed conduct that could support jurisdiction over defendants.  Only after that dismissal did plaintiffs move for “reconsideration.”  Their motion asked the court to transfer the case to the Dallas federal court “in the interest of justice” under 28 U.S.C. §§ 1631, 1406, and/or 1404(a) – the same transfer they had rejected when defendants had moved for it nearly three years earlier.

The Court’s Decision

The court denied plaintiffs’ “reconsideration” motion, finding it to be “a last-ditch effort to rewind the clock” and ignore at least three years of litigation, including the unnecessary and avoidable burdens that plaintiffs’ Florida suit had imposed on defendants and the court.

The court held that the “interest of justice” standard under §§ 1631, 1406, and 1404(a) was designed “to rescue cases mistakenly filed in the wrong court,” where the plaintiff was “confused as to the proper forum.” But plaintiffs here had not been mistaken or confused; they had taken “a calculated risk” in suing in Florida, where personal jurisdiction was highly questionable.  Moreover, they had rejected defendants’ effort to transfer the case to Dallas, and they had never previously request transfer as an alternative to dismissal.

In these circumstances, the court held, “a strategic risk comes at a price.” “Parties cannot target a (supposedly) advantageous forum, stave off a timely request to relocate to the Defendants’ home turf, and then double back if the gamble fails.  To hold otherwise would be to incentivize plaintiffs to wage personal-jurisdiction battles and turn late-breaking transfer motions into a failsafe.  But the ‘interest of justice’ analysis . . . is . . . not a vehicle for resurrecting a claim lost because the plaintiff erred in her initial choice of forums.”

Implications

The Karnas decision highlights the dangers of making – and then doubling down on – jurisdictionally risky strategic choices.  Filing in a jurisdictionally questionable forum is always a risky proposition.  But plaintiffs who insist on doing so might wish to consider proposing a transfer as an alternative to dismissal for lack of jurisdiction, instead of waiting to raise that issue until after losing the motion to dismiss.  And plaintiffs who have opposed a transfer that they later request in last-ditch effort to save their claims will be in a particularly tenuous position.  The Karnas parties’ briefing did not reveal any case in which a court granted a transfer motion that was not filed until after a dismissal for lack of personal jurisdiction and that the plaintiffs had previously opposed.