Opinion
02 Civ. 3659 (LLS)
August 6, 2002
Douglas A. Kuber, Esq., Siegler, Kuber sexton, Christime W.S. Byrd, Esq., Irell Manella LLP, Los Angeles CA Attorneys For Plaintiff
Ivan Kline, Esq., Friedman, Wittenstein Hochman, New York, N.Y. Attorneys For Defendant
Memorandum and Order
Defendant Savannah Air Center, LLC ("SAC") moves to dismiss or transfer this diversity action to the Southern District of Georgia. Because the balance of conveniences favors it, the motion to transfer is granted.
Discussion
Section 1404(a) of title 28 of the United States Code
provides, "For 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." As the movant, defendant bears the burden of establishing that the case should be transferred. See Factors Etc., Inc. v. Pro Arts, Inc., 579 F.2d 215, 218 (2nd Cir. 1978).
Relevant factors in deciding a transfer motion include:
(1) the plaintiff's original choice of forum, (2) the locus of the operative facts, (3) the convenience and relative means of the parties, (4) the convenience of the witnesses, (5) the availability of process to compel the attendance of witnesses, (6) the location of physical evidence, including documents, (7) the relative familiarity of the courts with the applicable law, and (8) the interests of justice.TM Claims Service v. KLM Royal Dutch Airlines, 143 F. Supp.2d 402, 403-04 (S.D.N.Y. 2001).
The threshold question is whether the transferee district is one "where venue might have been proper and where the defendant would have been subject to process." Dwyer v. General Motors Corp., 853 F. Supp. 690, 692 (S.D.N.Y. 1994). Under 28 U.S.C. § 1391(a), venue is proper in this diversity case where the single defendant resides, or in "a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred."
Plaintiff USA Interactive ("USA") sues SAC for breach of contract and negligent repair, claiming that SAC failed to refurbish USA's corporate jet on time and in accordance with contract and Federal Aviation Agency Regulations. The real issue in the case is defendant's performance of the contract and not its formation. Although some of the contract negotiations involved faxes and phone calls to New York, SAC performed all of the refurbishment work in Georgia. Georgia is where a substantial part of the events giving rise to plaintiff's claim occurred. Since SAC is subject to personal jurisdiction in the Southern District of Georgia because its offices and facilities are there, venue is proper there.
Looking at the first factor for transfer, although the plaintiff's choice of forum is given significant weight, it is less important ""where the case's operative facts have little connection with the chosen forum.'" TM Claims, 143 F. Supp.2d at 404, quoting 800-Flowers v. Intercontinental Florists, Inc., 860 F. Supp. 128, 134 (S.D.N.Y. 1994). The main connection to New York is that USA's principal place of business is here. Where, as here, other factors strongly favor transfer, plaintiff's choice of forum is not decisive. Cf. id., at 404 (the fact that plaintiff was a New York corporation did not prevent transfer because the basis of plaintiff's claim was damage done to cargo that defendant transported from Amsterdam to Georgia).
The terms of the contract were set between defendant SAC and Royce Stevens, USA's representative in Georgia. USA flew the plane to Georgia, where it was delivered to SAC for refurbishing. USA picked up the airplane in Georgia when the work was done. During the performance of the contract, USA's pilot went to Georgia for a test flight. The only physical work in New York was the test-sitting in a seat by USA's president to see that it was comfortable for him. The seat had been sent to New York for the purpose, but that was only one of many aspects of the refurbishment, and is not a part of plaintiff's claim that the completed work was substandard.
The next factor, convenience and relative means of the parties, favors a transfer. USA is a publicly traded company with business operations in every state. SAC is a smaller privately held corporation based exclusively in Georgia. Although the relative means of the parties is a more significant factor when one party is an individual, the fact that "there is a disparity between the relative means of the two corporations," 800-Flowers, 860 F. Supp. at 135, supports a transfer.
Convenience of witnesses "is generally the most important factor."Dwyer, 853 F. Supp. at 692. Twelve SAC employees will testify about the performance of the contract. See Zacharius Reply Aff., at ¶ 13. Eight of them, including an engineer, a lead avionics/electronics employee, a lead upholsterer, a lead installer, a cabinet maker, and two sheet metal workers, will testify about the specific work that USA alleges was defective and inferior. These witnesses reside in Georgia. USA's employees, in New York, will testify concerning USA's damages and negotiations with SAC. See Byrd Aff., at 1-2. It is SAC's employees who have the most material knowledge of the basis of plaintiff's claim, the work performed upon the jet. Suit in Georgia is more convenient for them.
The next factor, the availability of process to compel the attendance of witnesses, is generally only relevant to third party witnesses, since employees of the parties will be available voluntarily. See TM Claims, 143 F. Supp.2d at 406. SAC has identified nine third party witnesses in Georgia, including outside engineers and subcontractors, who will testify about the refurbishment work. See Zacharius Reply Aff., at ¶ 13. USA identifies eleven non-party witnesses. The only one who will "testify regarding SAC's work" is Royce Stevens, an independent consultant hired by USA, who resides in Florida. Byrd Aff., at 2. The other witnesses are two former USA employees who will testify about USA's contract negotiations and damages. The remaining witnesses are employees of Naomi Leff and Associates, a design firm, who "are expected to testify about their design work and their communications with SAC." Id. That testimony concerns specifications of the refurbishment and not the main issue in dispute, the defendant's performance.
The physical evidence does not weigh for or against transfer because it consists mostly of documents, which are "not voluminous and are easily transported." Royal Ins. Co. of America v. United States, 998 F. Supp. 351, 354 (S.D.N.Y. 1998) Although the jet is registered in New York, it is not kept there.
Georgia law appears to govern the interpretation of the contract, even if USA did not agree to Georgia as the forum. See Lazard Freres Co. v. Protective Life Ins. Co., 108 F.3d 1531, 1539 (2ndCir. 1997) (In breach of contract cases, "New York courts seek to apply the law of the jurisdiction with the most significant interest in, or relationship to, the dispute."); Int'l Business Machines, Corp. v. Kemp, 536 S.E.2d 303, 307 (Ct.App. Ga 2000) (law of the state where the contract was performed governs)
Efficiency and the interests of justice dictate that the case should be transferred to Georgia, where the refurbishing work was done and the most material witnesses reside.
The motion is granted. The Clerk will transfer the action and file to the United States District Court for the Southern District of Georgia.