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determining that venue was proper under Section 1391 in part because numerous communications concerning the terms of sale either originated in the district or were made to the plaintiffs in the district
Summary of this case from Ross v. DigioiaOpinion
01-CV-4801
December 21, 2001
MEMORANDUM ORDER
In this breach of contract action, plaintiffs Computer Express International, Ltd. ("Computer Express") and Digital Data Devices, Inc. ("Digital Data") allege that defendant MicronPC, LLC ("Micron") breached an agreement to sell plaintiffs 1200 Micron Millennium XV computer systems. Micron now moves to dismiss the action for improper venue, pursuant to Fed.R.Civ.P. 12(b)(3) and 28 U.S.C. § 1406, or, in the alternative, to transfer the action to the United States District Court for the District of Idaho, pursuant to 28 U.S.C. § 1404. For the reasons set forth below, Micron's motion is denied.
BACKGROUND
I. The parties
Computer Express is a New York corporation with a principal place of business in Kings County, New York. (See Compl. ¶¶ 3, 11.) Digital Data is a New Jersey corporation with a principal place of business in Edison, New Jersey. (See id. ¶¶ 4, 12.) Computer Express and Digital Data have, at various times, entered into joint ventures for the purchase and re-sale of consumer electronics, including computers. (See id. ¶ 13; see also Kraiem Decl. ¶ 14.)
According to the complaint, Micron is an Idaho corporation with a principal place of business in Nampa, Idaho. (See Compl. ¶¶ 5, 14; see also Kraiem Decl. Ex. J.) Micron manufactures and distributes computers and computer systems. (See Compl. ¶¶ 19-20.) According to its website, Micron is "the nation's third largest direct seller of computers." (Kraiem Decl. Ex. J.) Micron products also are sold "in partnership with leading resellers nationwide." (Id.)
A search of the website of the Idaho Secretary of State, however, indicates that Micron is a Delaware limited liability company with its principal place of business in Nampa, Idaho. This information can be found by accessing the websitehttp://www.accessidaho.org/public/sos/corp/search.html. and entering "MicronPC" in the "Business Entity Name" search box.
II. The current dispute
In February of 2001, Micron sold 1200 of its Micron Millennium XV computer systems to Staples, Inc. ("Staples"), an office supply company, for re-sale by Staples. (See Koehl Aff ¶ 2.) The computer systems were shipped to four Staples distribution centers — two in California, one in Maryland, and one in Indiana. (See id. ¶ 3.) These computer systems, however, did not sell well, and therefore they remained, "for the most part," in Staples's inventory. (See id.)
Micron alleges that the computer systems actually were sold to Staples by Micron Electronics, Inc. ("MEI"). According to Micron, approximately four months after the sale of the computer systems to Staples, MEI "spun off" its personal computer business, which ultimately resulted in the formation of Micron.
According to plaintiffs, sometime in June or July of 2001, Staples returned the computer systems to Micron. (See Kraiem Decl. ¶¶ 17-18.) Around that time, Hall Ewing, a business acquaintance of Kraiem (the President of Computer Express), apparently became aware that Staples had returned the computer systems to Micron. (See id. ¶ 17.) After Ewing informed Kraiem of this fact, Kraiem, interested in purchasing the systems, asked Ewing to arrange for him to speak directly with Ewing's contact at Micron, Oscar Nunez. (See id.) Some discussions between Kraiem and Nunez followed, each of which allegedly took place by telephone, e-mail or fax. (See id. ¶¶ 20-21.) In the end, Kraiem, on behalf of Computer Express and Digital Data, agreed to purchase all 1200 returned computer systems from Micron for $350 each. (See Kraiem Decl. ¶ 18; Compl. ¶ 26.)
The Court notes that the Kraiem Declaration repeats two paragraphs (numbered 17 and 18 on page 3 and 18 and 19 on page 4).
On July 10, 2001, Micron faxed an "Order Memo" to Computer Express, which allegedly confirmed the deal. (See Kraiem Decl. ¶ 23; Compl. Ex. A.) The Order Memo is on Micron letterhead, and states "Remit Payment To: MicronPC, LLC, P.O. Box 94172, Chicago, IL 60890." (Compl. Ex. A.) The Order Memo lists "Computer Express, 945 Coney Island Ave., Brooklyn, N Y 11230" in both the "Bill To" and "Ship To" sections. (Id.) Additionally, the Order Memo states that the "purchaser" agreed "that this purchase will be controlled by MicronPC's Terms and Conditions of Sale document, that the equipment will be covered by the applicable MicronPC limited warranty, and that I have received both documents." (Id.)
One day later, Kraiem signed the Order Memo and faxed it back to Nunez. (See Kraiem Decl. ¶ 24.) In accordance with Nunez's instructions, Kraiem also wired $87,000 to Micron's bank account, as a partial payment of the purchase price of the computer systems. (See id. ¶ 26-27 Ex. D.) The remaining portion of the purchase price — $333,000 — was then charged to the credit cards of Kraiem and Ely Eddi, the president of Digital Data. (See id. ¶ 29.)
The following day, however, Micron suddenly backed out of the deal. (See id. ¶ 31.) When Kraiem called Nunez to discuss Micron's actions, Nunez referred Kraiem to Adam Lerner, Micron's Executive Vice President for SMB Sales and Operations. (See id. see also Lerner Reply Aff. ¶ 12.) Numerous conversations then took place between Nunez and Lerner, on one hand, and Kraiem and Eddi on the other. (See Kraiem Decl. ¶¶ 31-32.) Unfortunately, the parties were unable to resolve their dispute. Because plaintiffs allegedly had lined up a number of buyers for the computer systems, plaintiffs claim to have sustained substantial damages as a result of Micron's actions. (See Compl. ¶¶ 33-44.)
Micron, however, paints a very different picture of the events giving rise to plaintiffs' lawsuit. According to Micron, plaintiffs never agreed to purchase anything from the company, because Staples had, in fact, never returned the 1200 Millennium XV computer systems to Micron. (See Koehl Aff. ¶¶ 7-9.) Instead, Micron avers that, once Ewing found out that the computer systems were not selling well, he attempted to broker a deal, with Micron's help, for plaintiffs to purchase the computer systemsdirectly from Staples. (See id. ¶ 8.) While Micron representatives apparently agreed to help Ewing broker such a deal, those representatives allegedly made it clear that they had very little control over the terms of any agreement, because the computer systems belonged to Staples, not Micron. (See id.)
Micron asserts that, after a July 10, 2001, telephone call between Ewing and Micron representatives, Micron communicated to Staples an offer by plaintiffs to purchase the computer systems for $350 each. (See ¶¶ 9-10.) Micron further alleges that, at that time, Ewing requested that Micron "print out a specifications sheet with respect to the MEI systems owned by Staples. Oscar Nunez forwarded an `Order Memo' to [Computer Express], for ease of reference, time, and convenience, with the specific understanding that any of the said preliminary discussions were subject and conditional upon Staples' acceptance." (Lerner Reply Aff. ¶ 11) In other words, Micron claims that the Order Memo was not in any way an agreement, or even an offer, on its part to sell 1200 Millennium XV computer systems to plaintiffs.
With respect to the $87,000 plaintiffs wired to Micron, Micron claims that it asked plaintiffs for the money because the company had encountered problems with Ewing in the past. Accordingly, Micron wanted the money in order to verify that plaintiffs were serious about consummating the transaction, and so that Micron could "avoid eroding [the] company's credibility with Staples by convincing Staples to agree to sell the inventory to [plaintiffs], only to have the deal disappear." (Lerner Reply Aff. ¶ 8.)
Micron also denies ever receiving the signed version of the Order Memo that Kraiem purportedly faxed to Micron on July 11, 2001. (See Lerner Reply Aff. ¶ 15.)
According to Micron, Staples rejected plaintiffs' offer of $350 per computer system. (See id. ¶ 12.) Lerner then had Nunez contact both Ewing and Computer Express, in order to inform them that Staples had rejected the offer. (See id.) Lener himself also spoke with someone (presumably Kraiem) at Computer Express to convey Staples's rejection of plaintiffs' offer. ( See id.) Apparently, Micron also refunded the $87,000 plaintiffs had wired the day before. (See id. ¶ 8.) Micron claims to have once again contacted Staples, four days later, about a possible purchase by plaintiffs, but Staples again refused the deal. (See id.)
On July 19, 2001, plaintiffs commenced this action. Plaintiffs assert claims for, inter alia, breach of contract, interference with business relations, and misrepresentation, and seek unspecified damages between $115,000 and $1.5 million. Micron filed its motion to dismiss, or in the alternative to transfer, on October 5, 2001.
DISCUSSION
I. The Motion to Dismiss for Improper Venue
According to Micron, plaintiffs' "self-motivated [venue] selection was done without regard to the appropriate principals [ sic] of venue and proper forum as provided by the Federal Rules of Civil Procedure, U.S. statutes, and case law on the subject." (Defendant's Memorandum of Law in Support of its Motion to Dismiss Plaintiff's [ sic] Complaint for Improper Venue ("Def Mem.") at 5.) Micron argues that it is "without any applicable contacts with the State of New York that would render venue proper in Plaintiff's [ sic] selected forum." ( Id.) Micron's argument is wholly without merit.
Where, as here, a plaintiff invokes diversity jurisdiction, venue is governed by 28 U.S.C. § 1391 (a). That section states:
A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) 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, or (3) a judicial district in which any defendant is subject to personal jurisdiction at the time the action is commenced, if there is no district in which the action may otherwise be brought.
In addition, where at least one defendant is a corporation, the provisions of 28 U.S.C. § 1391 (c) are implicated. That section provides:
[A] defendant that is a corporation shall be deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time the action is commenced. In a State which has more than one judicial district and in which a defendant that is a corporation is subject to personal jurisdiction at the time an action is commenced, such corporation shall be deemed to reside in any district in that State within which its contacts would be sufficient to subject it to personal jurisdiction if that district were a separate State, and, if there is no such district, the corporation shall be deemed to reside in the district within which it has the most significant contacts.
A. Venue is proper under Section 1391(a)(1)
In this case, because there is only one defendant, "all defendants reside in the same State" ipso facto; thus, Section 1391(a)(1) applies. The remaining question, then, is: in what district does Micron reside? Under Section 1391(c), Micron resides in any district in which it is subject to personal jurisdiction. By failing to move to dismiss for lack of personal jurisdiction. however, Micron has conceded that it is subject to personal jurisdiction in this district. In any event, even if Micron had not conceded this point, exercising personal jurisdiction over Micron is proper, because plaintiffs have alleged that Micron contracted to sell computer systems to Computer Express, a New York corporation. Under New York's long-arm statute (New York Civil Practice Law and Rules ("C.P.L.R.") Section 302(a)(1)), this fact is sufficient to subject Micron to personal jurisdiction here for claims arising out of that contract. See APC Commodity Corp. v. Ram Dis Ticaret A.S., 965 F. Supp. 461, 464-65 (S.D.N.Y. 1997) ("New York courts may exercise jurisdiction over a nondomiciliary who contracts outside this State to supply goods or services in New York so long as the cause of action arose out of that contract. Jurisdiction may exist even when the goods are never shipped or supplied to New York.") (citations omitted);Micro-Assist. Inc. v. Cherry Communications. Inc., 961 F. Supp. 462, 464-65 (E.D.N.Y. 1997); Anderson Dev. Corp. v. Isoreg Corp., 154 A.D.2d 859, 860, 546 N.Y.S.2d 720, 721 (3d Dep't 1989). Finally, if the Eastern District of New York were a "separate state" under 28 U.S.C. § 1391 (c), Micron would be subject to personal jurisdiction here, because Micron is alleged to have contracted to sell goods to Computer Express, a corporation located in the district. For these reasons, venue is proper in this Court under 28 U.S.C. § 1391 (a)(1).
See Fed.R.Civ.P. 12(g), (h)(1); see also Pilgrim Badge Label Corp. v. Barrios, 857 F.2d 1, 3 (1st Cir. 1988) (defendant "waived the defense of lack of personal jurisdiction by failing to raise the defense in his motion to dismiss"); cf. Sangdahl v. Litton, 69 F.R.D. 641, 642-43 (S.D.N.Y. 1976) (defendant waived personal jurisdiction defense by filing motion to transfer).
Since no discovery has yet occurred in this case, plaintiffs need only make "legally sufficient allegations of jurisdiction" over Micron.Cf. Jazini v. Nissan Motors Co., 148 F.3d 181, 184 (2d Cir. 1998) (to defeat pre-discovery motion to dismiss for lack of personal jurisdiction, plaintiff merely had to make prima facie showing of jurisdiction i.e. "legally sufficient allegations of jurisdiction") (citations omitted).
The Court must look to New York law to determine whether Micron is subject to personal jurisdiction here. See Jazini v. Nissan Motors Co., 148 F.3d 181, 183 (2d Cir. 1998) ("[T]he amenability of a foreign corporation to suit in a federal court in a diversity action . . . is determined in accordance with the law of the state where the court sits. . . .").
Contracting to supply goods in this state also satisfies the second part of the personal jurisdiction analysis — whether exercising personal jurisdiction over the defendant comports with due process. A party contracting to supply goods to a New York buyer should "reasonably anticipate being haled into court here" as a result of its activities.Anderson Dev. Corp., 154 A.D.2d at 860, 546 N.Y.S.2d at 721 (internal quotation marks and citations omitted); accord Micro-Assist, 961 F. Supp. at 464 ("By contracting to supply goods and services to New York, Mercury established minimum contacts with this State sufficient to meet the requirements of Constitutional Due Process.").
B. Venue is proper under Section 1391(a)(2)
Venue also is proper under Section 1391(a)(2). Plaintiffs have established that numerous communications concerning the terms of the sale of the computer systems either originated in this district or were made to Computer Express and/or Kraiem in this district. (See Kraiem Decl. ¶¶ 18, 20-27, 31-32; see also Lerner Reply Aff. ¶¶ 10-12.) In addition, Computer Express wired $87,000 to Micron's bank account from this district. (See Kraiem Decl. ¶ 26.) Furthermore, at least some of the computer systems were to be shipped to this district. Accordingly, a "substantial part of the events or omissions giving rise to the claim" occurred in the Eastern District of New York, and thus venue is proper here under Section 1391(a)(2). See e.g, U.S. Titan, Inc. v. Guangzhou Zhen Hua Shipping Co., Ltd., 241 F.3d 135, 153-54 (2d Cir. 2001) (fact that terms of arbitration agreement were negotiated by telephone and facsimile with party in New York meant that "substantial part of the events giving rise to the claim" occurred in New York); Sacody Techs., Inc. v. Avant. Inc., 862 F. Supp. 1152, 1157 (S.D.N.Y. 1994) (venue proper in Southern District of New York in action for breach of confidentiality agreement, where parties' "dealings . . . in relation to the Confidentiality Agreement took place over the phone and by correspondence and facsimile between [the parties] in Massachusetts and New York, respectively") (citation omitted). In fact, venue would be proper even if the Court were to credit Micron's misleading assertion that it never "communicated directly with Plaintiff [Computer Express]" (Koehl Aff. ¶ 16), bur rather communicated only with Ewing, plaintiffs' broker. See U.S. Titan, 241 F.3d at 153 ("That many of [defendant's] communications reached [plaintiff's] offices in New York through the Connecticut brokers does not alter the fact that [defendant] directed communications to New York. Accordingly, venue in the Southern District of New York was proper.").
This assertion is contradicted by Micron's own evidence. (See Lerner Reply Aff. ¶ 10 ("On or about July 10, 2001, Defendant's employee Oscar Nunez had a telephone conversation . . . with Mr. Hall Ewing and CEI President Nat Kraiem."); id. ¶ 12 ("On July 12, 2001, . . . I had a telephone conversation with CEI. . . .").)
C. The forum selection clause does not mandate litigation in Idaho
The only argument Micron makes in support of its motion to dismiss is that the alleged contact of sale, the Order Memo, specifically included a forum selection clause designating Idaho as the proper forum to resolve this dispute. (See Def Mem. at 2-3.) According to Micron, "[p]laintiffs' commencement of the instant litigation in [this Court] contradicts said contractual provision, and is improper." (Id. at 3.) Micron's argument, however, is fatally flawed.
It should be noted that Micron is trying to have its cake and eat it, too. On one hand, Micron argues that no contract exists between it and plaintiffs. (See Koehl Aff. ¶ 13; Lerner Reply Aff. ¶ 14.) On the other hand, however. Micron seeks to enforce the forum selection clause in that contract. (See Def. Mem. at 2.) Micron cannot have it both ways.
The forum selection clause at issue — which plaintiffs contend does not even apply because it allegedly was never presented to them — states that "[t]his agreement is governed by the laws of the State of Idaho, without regard to its conflict or choice of law provisions. Customer acknowledges and agrees that Idaho is an appropriate place for venue of any litigation and that Idaho courts have jurisdiction over this agreement and customer." (Koehl Aff. Ex. A.) Even if Micron is correct that this clause is part of the contract between plaintiffs and Micron, the clause nonetheless does not require dismissal in favor if litigation in Idaho, as set forth below.
Although courts generally enforce forum selection clauses, they will only do so when the clause makes litigation in the chosen forummandatory. In other words, a forum selection clause which merely specifies that the parties consent to jurisdiction in the chosen forum "will generally not be enforced without some further language indicating the parties' intent to make the jurisdiction exclusive." John Boutari Son, Wines Spirits, S.A. v. Attiki Importers Distribs., Inc., 22 F.3d 51, 52 (2d Cir. 1994). Needless to say, the forum selection clause in this case is anything but mandatory. The clause simply states that Idaho is "an appropriate" forum, not that litigation must occur there. Furthermore, the fact that the forum selection clause indicates that plaintiffs consented to jurisdiction in Idaho is insufficient: "an agreement conferring jurisdiction in one forum will not be interpreted asexcluding jurisdiction elsewhere unless it contains specific language of exclusion. . . ." John Boutari Son, 22 F.3d at 53 (emphasis in original) (citing City of N.Y. v. Pullman. Inc., 477 F. Supp. 438, 442 n. 11 (S.D.N.Y. 1979) (Weinfeld, J.)). See also Reliance Ins. Co. v. Six Star, Inc., 155 F. Supp.2d 49, 58 (S.D.N.Y. 2001) (forum selection clause stating that the parties "will submit to the jurisdiction of the State of New York and will comply with all the requirements necessary to give such court [ sic] jurisdiction" not mandatory); Weiss v. LaSuisse, 69 F. Supp.2d 449, 454-56 (S.D.N Y 1999) (forum selection clause stating that parties "have the right to take any dispute between themselves . . . either before the judge of the competent court of their domicile in Switzerland or in front of the civil court in Lausanne" did not mandate litigation in Switzerland); Micro-Assist 961 F. Supp. at 466 (forum selection clause stating "[t]he parties agree that venue for any action arising hereunder or related hereto is proper if filed in any court in Dallas County. Texas" was permissive, not mandatory).
Because the forum selection clause does not require litigation of this dispute in Idaho, and because venue is proper in this district, Micron's motion to dismiss for improper venue must be denied.
II. The Motion to Transfer Under 28 U.S.C. § 1404
In the alternative of its motion to dismiss, Micron asks the Court to transfer this action to the United States District Court for the District of Idaho. (See Def. Mem. at 3-4.) Micron contends that the balance of equities tips heavily in favor of transferring this case to Idaho. (See id. at 4.) Micron's argument is specious.
The change of venue statute, 28 U.S.C. § 1404 (a), provides that, "[f]or the convenience of panics and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." The purpose of Section 1404(a) "is to prevent `waste of time. energy and money' and `to protect litigants, witnesses and the public against unnecessary inconvenience and expense. . . .'" Van Dusen v. Barrack, 376 U.S. 612, 626 (1964) (quoting Cont'l Grain Co. v. Barge FBL-585, 364 U.S. 19, 26, 27 (1960)). Motions to transfer venue "lie within the broad discretion of the district court and are determined upon notions of convenience and fairness on a case-by-case basis." Publicker Indus. Inc. v. United States (In re Cuyahoga Equip. Corp.), 980 F.2d 110, 117 (2d Cir. 1992) (citingStewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988)). The burden of demonstrating that a case should be transferred is on the movant, Factors Etc., Inc. v. Pro Arts. Inc., 579 F.2d 215, 281 (2d Cir. 1978) (abrogated on other grounds by Pirone v. MacMillan, Inc., 894 F.2d 579, 585-86 (2d Cir. 1990)), and a "clear-cut showing" must be made that transfer is in the best interest of the litigation, Smart v. Goord, 21 F. Supp.2d 309, 315 (S.D.N.Y. 1998); accord Connors v. Lexington Ins. Co., 666 F. Supp. 434, 454 (E.D.N.Y. 1987).
In deciding whether transfer is appropriate, a court must engage in a two part inquiry. First, the court must determine whether the action might have been brought in the proposed transferee district. Second, if the action could have been brought in that district, the court must weigh the convenience of the parties and witnesses, and the interest of justice. See United States Fid. Guar. Co. v. Republic Drug Co., 800 F. Supp. 1076, 1079 (E.D.N.Y. 1992) (citations omitted).
In this case, there can be little dispute that this action could have been brought in the District of Idaho, as both venue and personal jurisdiction would have been proper there. Personal jurisdiction would be proper because Micron transacts business in Idaho. See Idaho Code § 5-514(a) (2000). Furthermore, for the reasons discussed above, venue is proper in Idaho because (i) Micron is the only defendant, and, because it is subject to personal jurisdiction in Idaho, it is deemed to reside there see 28 U.S.C. § 1391 (a)(1), (c), and (ii) a substantial part of the events giving rise to this lawsuit occurred in Idaho, see id. § 1391(a)(2). The Court will therefore consider whether transfer is warranted.
In deciding whether to transfer a lawsuit, a court should consider the following relevant factors: (1) the weight accorded the plaintiff's choice of forum; (2) the place where the operative facts took place; (3) the convenience of the parties; (4) the convenience of witnesses, and the availability of process to compel unwilling witnesses; (5) the location of relevant documents and the relative ease of access to sources of proof; (6) a forum's familiarity with the governing law; and (7) trial efficiency and the interest of justice See e.g. O'Hopp v. ContiFinancial Corp., 88 F. Supp.2d 31, 34 (E.D.N.Y. 2000) (citing Balaban v. Pettigrew Auction Co. Inc., No. 96-CV-3177, 1997 WL 470373, at *2 (E.D.N.Y. 1997)); Dwyer v. Gen. Motors Corp., 853 F. Supp. 690, 692 (S.D.N.Y. 1994); see also Micro-Assist, 961 F. Supp. at 465. After balancing these factors, it appears that transfer is unwarranted.
A. Plaintiffs' choice of forum
"A plaintiff's choice of forum is generally entitled to considerable weight and should not be disturbed unless the balance of the factors is strongly in favor of the defendant." Berman v. Informix Corp., 30 F. Supp.2d 653, 659 (S.D.N.Y. 1998) (citations omitted). Further, a plaintiff's choice of forum "is generally accorded more deference where there is a material connection or significant contact between the forum state and the underlying events allegedly underlying the claim, or where the plaintiff is a resident of the forum district."Id. (internal citation omitted).
The Second Circuit recently noted, in an en banc opinion concerning an injury sustained in a foreign country, that "[t]he more it appears that a . . . plaintiff's choice of forum has been dictated by reasons that the law recognizes as valid, the greater the deference that will be given to the plaintiff's forum choice." Iragorri v. United Techs. Corp., ___ F.3d ___, 2001 WL 1538928, at *3 (2d Cir. Dec. 4, 2001). Valid reasons supporting a plaintiff's choice of forum include "the convenience of the plaintiff's residence in relation to the chosen forum, the availability of witnesses or evidence to the forum district, the defendant's amenability to suit in the forum district, the availability of appropriate legal assistance, and other reasons relating to convenience or expense." Id. A reason stressed by the court as invalid was a choice of forum "motivated by forum-shopping." Id.
This factor weighs heavily in plaintiffs' favor, because there is a material connection between New York and the events giving rise to plaintiffs' claims: the terms of the agreement were negotiated through telephone calls made, or e-mails and faxes sent, to or from New York; part of the consideration due under the contract was wired from New York; and the computer systems were to be shipped to New York. Furthermore, one of the plaintiffs, Computer Express, resides in this district.
The fact that the other plaintiff, Digital Data, resides in the nearby District of New Jersey does not alter the conclusion that plaintiffs' choice of forum is entitled to substantial deference. See Iragorri v. United Techs. Corp., ___ F.3d ___, 2001 WL 1538928, at *4 (2d Cir. Dec. 4, 2001) ( en banc) (rejecting contention that "deference is given to the plaintiff's choice of forum only when the plaintiff sues in the plaintiff's home district"). Furthermore, because Computer Express and Digital Data reside in different districts, it would have been impossible for them to commence one lawsuit and yet venue that lawsuit in both parties' home district. Here, it was perfectly reasonable for plaintiffs to choose to sue in New York, given the communications Micron had with Kraiem in New York, and the fact that the computer systems were to be delivered there.
B. The locus of the operative facts
To determine the locus of the operative facts in a breach of contract action, courts consider "where the contract was negotiated or executed, where it was to be performed, and where the alleged breach occurred."Prudential Sec. Inc. v. Norcom Dev., Inc., No. 97 Civ. 6308, 1998 WL 397889, at *4 (S.D.N.Y. July 16, 1998) (citations omitted). Here, the contract was negotiated between an Idaho company and a New York company, with the assistance of an Arizona resident (Ewing); hence, the communications concerning the terms of the contract took place in Idaho, Arizona and New York. The contract ultimately was executed in New York. The alleged breach occurred in Idaho, when Micron backed out of the deal, but the place of performance was New York, the location to which the computer systems were to be delivered. See In re Masonite Corp. Hardboard Siding Prods. Liab. Litig., 21 F. Supp.2d 593, 598 (E.D. La. 1998) (in sale of goods transaction, place of delivery is the place of performance); D.P. Tech. Corp. v. Sherwood Tool. Inc., 751 F. Supp. 1038, 1040 n. 3 (D. Conn. 1990) (place of performance of contract for sale of computer system was "Connecticut, since the computer system was to be delivered to and used in Connecticut"). This factor, therefore, favors neither forum.
C. The convenience of the parties
Each side argues that it would be more convenient to try this action in its respective forum. Micron asserts that "litigat[ing] this matter in the State of New York . . . would be most inconvenient, inefficient, and expensive" for Micron (Def. Mem. at 5), presumably because Micron's "documents and witnesses" allegedly are located in Idaho (see Lerner Reply Aff. ¶ 19). Plaintiffs contend that "[t]he inconvenience is far greater for two local Plaintiffs to travel to litigate the within claims in Idaho rather than Defendant. part of a multinational corporation[,] to defend in New York." (Plaintiffs' Memorandum of Law in Opposition to Defendant's Motion to Dismiss or to Transfer This Case ("Pl. Mem.") at 8.) Plaintiffs' counsel also avers that each plaintiff is a small business, with fewer than ten employees, and that litigating this case in Idaho "would create a serious disruption in [plaintiffs'] business." (Kaufman Decl. ¶¶ 3-4)
While the relative means of the parties is a relevant consideration in this analysis see Dotsana Enters. LLC v. Federal Express Corp., No. 00 CIV 0747, 2000 WL 1170134, at *4 (S.D.N.Y. Aug. 16, 2000), the conclusory allegation of plaintiffs' counsel is insufficient to demonstrate a "serious disruption" to plaintiffs' business would result from litigation in Idaho. see id.
"Where transfer merely serves to shift the inconvenience from one party to the other, the plaintiff's choice of forum should not be disturbed."Snyder v. Madera Broadcasting. Inc., 872 F. Supp. 1191, 1200 (E.D.N.Y. 1995) (internal quotation marks and citation omitted); accord Dotsana Enters. LLC v. Federal Express Corp., No. 00 CIV 0747, 2000 WL 1170134, at *4 (S.D.N.Y. Aug. 16, 2000) ("The convenience of the parties factor does not weigh in favor of transfer where such transfer would merely shift the inconvenience of litigating in a particular forum from one party to the other."). Hence, it appears that this factor favors neither plaintiffs nor Micron, because transferring this action to Idaho would merely shift the burden of litigation from Micron to plaintiffs.
D. The convenience of witnesses and the availability of process to compel unwilling witnesses
The convenience of witnesses is considered "a particularly compelling factor guiding the decision to transfer a case." Kingsepp v. KMart Corp., No. 96-CV-5167, 1997 WL 269582, at *2 (E.D.N.Y. May 5, 1997). This factor appears to weigh in favor of litigation in New York, albeit only slightly.
All of Micron's party witnesses are located in Idaho (see Lerner Reply Aff. ¶ 19), while plaintiffs' party witnesses appear to be located in, or near, New York. The potential non-party witnesses include: (i) Ewing, who is an Arizona resident (see Lerner Reply Aff. ¶ 19); (ii) Staples employees, about whom there are no allegations of residence (although the computer systems at issue were allegedly shipped to Staples locations in Maryland, California and Indiana) (see id.); and (iii) the potential purchasers of the computer systems from plaintiffs, which are located in New York, New Jersey, and Florida (see Kraiem Decl. ¶ 30). None of these witnesses are located in Idaho, while one is located in New York and another is located nearby in New Jersey. The convenience of the remaining witnesses, who appear scattered across the country, favors neither forum.
Plaintiffs have nowhere specified where the president of Digital Data, Mr. Eddi, resides. However, it is fair to infer that Mr. Eddi lives close to New York, as Digital Data's place of business is in nearby Edison, New Jersey. (See Compl. ¶ 12.)
The "head buyer" of the New Jersey purchaser allegedly resides in New York. (See Pl. Mem. at 3 n. 2.)
With respect to the ability to compel the attendance of non-party witnesses, Rules 45(b)(2) and 45(c)(3)(A)(ii) of the Federal Rules of Civil Procedure proscribe a subpoena from requiring a witness to travel more than 100 miles. Thus, none of the non-party witnesses can be compelled to appear in Idaho either for a deposition or for trial in this matter, because each appears to reside more than 100 miles from Idaho. The non-party witnesses located in New York and New Jersey, however, can be so compelled.
Accordingly, on balance, this factor slightly favors retaining the action in New York.
E. The location of relevant documents and sources of proof
This factor favors neither plaintiffs nor Micron. While both sides allude to "documents" located within their respective fora, neither side specifies the content or number of these documents. In any event, it is unlikely that, in this relatively minor contract dispute, there are numerous documents involved, and thus any relevant documents can be easily transported to either forum.
F. Familiarity with the governing law
The parties dispute whether Idaho or New York law governs this action. Micron contends that Idaho law governs, because of a provision in the "Terms of Sale" — a document which was allegedly faxed along with the Order Memo — specifying that Idaho law applies. (See Koehl Aff. Ex. A.) Accordingly, Micron asserts that transfer is appropriate, because an Idaho federal court is more familiar with Idaho law than this Court. Plaintiffs, however, allege that the "Terms of Sale" document was not faxed with the Order Memo, and therefore never became part of the contract between them and Micron. Thus, plaintiffs contend that this Court should resolve the parties' dispute, because New York law governs the claims at issue. (See Pl. Mem. at 11; Kraiem Decl. ¶ 21.)
Regardless of which state's law applies, this factor favors neither side. The contract at issue is a contract for the sale of "goods" between "merchants," as those terms are defined in the Uniform Commercial Code.See N.Y.U.C.C. §§ 2-104(1), 2-105(1); Idaho Code §§ 28-2-104 (1). 28-2-105(1). Both New York and Idaho have adopted the Uniform Commercial Code. Accordingly, the law of Idaho is substantially similar to the law of New York. And, in any event, this Court is equally capable of applying Idaho law as an Idaho court, and an Idaho federal court is just as capable of applying New York law as a New York court. As thePrudential court noted, "the `governing law' factor is to be accorded little weight on a motion to transfer venue because federal courts are deemed capable of applying the substantive law of other states." 1998 WL 397889, at *6 (citations omitted).
G. Trial efficiency and the interest of justice
Neither side contends that this case will proceed more expeditiously in Idaho than in New York, or vice versa. Furthermore, there is no reason to conclude that this action should be transferred "in the interest of justice," as this action has a reasonable connection to this district, plaintiffs' chosen forum.
H. The weight of the factors supports retaining jurisdiction
On balance, the relevant factors do not support Micron's argument that this action should be transferred to Idaho. Plaintiffs' choice of forum is entitled to substantial deference, given the connection between the Eastern District of New York, the plaintiffs, and the events giving rise to plaintiffs' claims. Each of the remaining factors either is in equipoise or slightly favors respecting plaintiffs' forum choice. Therefore, Micron's alternative motion to transfer must be denied.
CONCLUSION
For the foregoing reasons, Micron's motion to dismiss for improper venue, or in the alternative to transfer this action to the District of Idaho, is denied in its entirety.
SO ORDERED.