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explaining "[t]his factor should favor the non-moving party if it merely shifts inconveniences from the defendants to the plaintiffs" and concluding that it weighed against transfer "based on the presumption supporting the non-moving party"
Summary of this case from Stribling v. PicazoOpinion
2:06-cv-1738-MCE-GGH.
December 13, 2006
MEMORANDUM AND ORDER
Through the present suit, Plaintiff Decter alleges that Defendants MOG Sales LLC ("MOG"), Hayden Gill ("Gill"), Robert Mudryk ("Mudryk"), and Max Fresen ("Fresen") committed fraud, conversion, breach of contract, and breach of duty of loyalty against him.
Now before the Court is Defendants' motion, pursuant to Federal Rule of Civil Procedure 12(b)(2) and the doctrine of forum non conveniens, to dismiss for lack of personal jurisdiction or alternatively for a transfer of this action to the Eastern Division of the United States District Court for the Northern District of Ohio. After carefully considering all the papers filed by the parties, Defendants' Motion to Transfer is GRANTED and Motion to Dismiss for Lack of Personal Jurisdiction is DISMISSED as moot.
All further references to "Rule" or "Rules" are to the Federal Rules of Civil Procedure unless otherwise noted.
Because oral argument will not be of material assistance, the Court orders this matter submitted on the briefs. E.D. Cal. Local Rule 78-230(h).
BACKGROUND
The Court relies on the allegations contained in Plaintiff's Complaint, as well as those contained within his declaration (see Decl. of Jarrod Decter, Ex. 1 to Pl.s' Opp'n) in reciting the alleged facts of this case.
In May or June of 2005, Plaintiff met Defendant Gill online, using Microsoft Live Windows Messenger. The online communication led to a business relationship between Plaintiff and Defendants premised on the expansion of Plaintiff's website.
In June of 2005, Plaintiff traveled to Ohio to discuss the anticipated business venture with Defendant Gill and Defendant Mudryk. While the details of the new partnership were not finalized, the meeting, which lasted several days, led to significant progress. At the conclusion of the negotiations, Defendant MOG hired an Ohio law firm to draft the necessary papers for creating a new legal entity. Additionally, in belief that a final partnership would be reached, Plaintiff claims that he disclosed confidential codes and passwords necessary to operate Gamergod.com to Defendants. Plaintiff also hired Defendant Fresen as a development manager for his own website. During the course of the meeting, Plaintiff claims that Defendant MOG offered him employment, which he accepted. Plaintiff allegedly began working for Defendant MOG on June 27, 2005 from his residence in California.
Defendants do not dispute that Plaintiff was employed by Defendant MOG. Rather, Defendants assert that the employment was a "temporary arrangement to be used until Decter [Plaintiff] and MOG were able to get their anticipate entity formed under Ohio law and operating in Ohio" (Def.'s Reply 4: 6-9).
Plaintiff asserts that after he returned to California, he continued to work with Defendants from his residence in finalizing the joint business venture.
According to Plaintiff, on March 17, 2006 he discovered not only that his employees had resigned and started working for Defendant MOG, but that he was also locked out of his website. On March 30, 2006, Plaintiff received his last pay check from Defendant MOG. Plaintiff claims he was denied severance pay, as provided for in his employment contract.
STANDARD
1. Motion to Transfer Pursuant 28 U.S.C. § 1404(a) 28 U.S.C. § 1404(a) ("Section 1404(a)") provides in pertinent part as follows: "[f]or the convenience of parties 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." Under Section 1404(a), a district court has discretion "to adjudicate motions for transfer according to an `individualized, case-by-case consideration of convenience and fairness.'" Jones v. GNC Franchising, Inc., 211 F.3d 495, 498-499 (9th Cir. 2000) (citing Stewart Org. Ricoh Corp., 487 U.S. 22, 29 (1988)).
While the Defendants moved to transfer the present matter under the doctrine of forum non conveniens, the Court interprets this motion as a motion to transfer under 28 U.S.C. § 1404(a). It has long been recognized "that Sec. 1404(a) `was drafted in accordance with the doctrine of forum non conveniens."Foster-Milburn Co. v. Knight, 181 F.2d 949, 952 (2nd Cir. 1950); see also Rogers v. Halford, 107 F. Supp. 295, 297 (D. Wis. 1952) (finding that the intent of "Congress in enacting Section 1404(a) was to adopt legislatively the doctrine of forum non conveniens"(citing Gulf Oil Corp. v. Gilber, 330 U.S. 501, 507 (1947)).
The moving party must make "a strong showing of inconvenience to warrant upsetting the plaintiff's choice of forum." Hope v. Otis Elevator Co., 389 F.Supp.2d 1235, 1242 (E.D. Cal. 2005) (quoting Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 743 (9th Cir. 1986)).
In determining whether a transfer is appropriate in a particular case, a court must consider multiple public and private factors: (1) convenience of the parties; (2) convenience of the witnesses; (3) ease of access to the evidence; (4) familiarity of each forum with the applicable law; (5) local interest in the controversy; and (6) the relative court congestion and time of trial in each forum. Id. As a threshold matter, it is undisputed that the Northern District of Ohio is a proper venue for this action. The question hence becomes whether this matter should be transferred to Ohio upon application of the factors relevant to determining the efficacy of such a transfer. Those factors, as enumerated above, will now be addressed.
ANALYSIS
1. Convenience of the Parties
This factor should favor the non-moving party if it merely shifts inconveniences from the defendants to the plaintiffs.DeFazio v. Hollister Employee Share Ownership Trust, 406 F.Supp. 2d 1085, 1090 (E.D. Cal 2005).
It is undisputed that the Northern District of Ohio is a more convenient forum for Defendants because Defendants' operations, employees and records are situated almost exclusively in Ohio. This District on the other hand is more convenient and cost effective for Plaintiff because he resides here and has retained California counsel. A transfer would merely shift the burden of an inconvenient forum from the Defendants to the Plaintiff. The Court finds, based on the presumption supporting the non-moving party, that this factor weighs against transferring this action.
2. Convenience of the Witnesses
The convenience of the witnesses is said to be the most important factor in considering a transfer motion. L.A. Mem'l Coliseum Comm'n v. Nat'l Football League, 89 F.R.D. 497, 501 (C.D. Cal. 1981).
All of Defendants' witnesses are located in Ohio or Massachusetts. Specifically, the law firm hired to create the business entity between Plaintiff and Defendants, the source of this dispute, is located in Ohio, as are most of Defendant MOG's employees. Although Plaintiff lives in California, he failed to identify any witness that resides in this forum. Accordingly, the Court finds that this factor substantially supports transferring this action to Ohio.
3. Ease of Access to the Evidence
When "the location of the evidence is supported by other factors in favor of transfer, the relative ease of access to proof is an important factor to be considered in deciding whether to grant a motion to transfer under section 1404." Jarvis v. Marietta Corp., 1999 U.S. Dist. LEXIS 12659 (N.D. Cal. 1999) (citing Decker Coal, 805 F.2d at 843).
All of Defendants' witnesses, as well as most of the evidence in this case, is located in Ohio. The anticipated business venture, between Plaintiff and Defendants, was negotiated in Ohio, and the evidence concerning those negotiations, including the June 2005 meeting conducted in Ohio, unquestionably derives from witnesses and/or documents within Ohio. Plaintiff claims evidence of his damages is located in California, but identifies no evidence going to the merits of the claims located in this State. The Court finds that the location and access to the majority of the evidence weighs strongly in favor of the Defendants' Motion to Transfer.
4. Governing Law
While it is not definite at this stage of litigation, there is a strong indication that Ohio law will control at least a significant portion of the claims in this lawsuit. The developing business venture between Plaintiff and Defendants was organized under Ohio law, Defendant MOG operates under Ohio law, and the employment relationship between Defendant MOG and Plaintiff commenced in Ohio.
Besides the harm Plaintiff allegedly suffered and the work he performed in California under his employment contract with Defendant MOG, all other aspects of this lawsuit are Ohio based, providing a substantial and persuasive argument for Ohio law to apply.
Clearly, an Ohio court would be more familiar with the contours and applicability of Ohio law, than one sitting in California. Consequently, the Court finds this factor tips in favor of Defendants.
5. Local Interest in the Controversy
The Court acknowledges that California maintains an interest in protecting Plaintiff, as one of its residents, from suffering emotional and economic harm. However, given that most of the documentary evidence, witnesses, and actions at issue in this case are in, or occurred in, Ohio, the Court finds that Ohio has a greater local interest in the controversy at issue than does California.
6. Relative Court Congestion in Each Forum
Neither party specifically addressed this factor in their papers. Because the Eastern District of California is one of the most congested district courts in the country, however, this factor would appear to support transferring this action to Ohio.
CONCLUSION
While the Plaintiff's choice of forum is given substantial weight when determining to transfer pursuant to 28 U.S.C. § 1404(a), the Court finds that Defendants have satisfied their burden showing that the convenience of the parties and witnesses and the interest of justice warrants transfer. Accordingly, Defendants' Motion to Transfer this action to the Eastern Division of the United States District Court for the Northern District of Ohio is GRANTED. Consequently, Defendants Motion to Dismiss for Lack of Personal Jurisdiction is DISMISSED as moot.IT IS SO ORDERED.