The opinion of the court was delivered by: RYAN
Defendants move to transfer this action to the United States District Court for the Eastern District of Michigan, Southern Division at Detroit, Michigan, pursuant to Section 1404(a), 28 U.S.C.A.
The nature of this action was fully set forth by me in an earlier opinion at 1948, 77 F.Supp. 425 and a statement of the facts may there be found. That opinion was on motions made by defendants who had then been served
, to dismiss the action on the ground of forum non conveniens. On April 21, 1948, I denied the motions on two grounds: (1) the doctrine of forum non conveniens was inapplicable as a matter of law because the action was one arising under the anti-trust laws, and (2) the defendants failed to show that even were the doctrine applicable, the facts as they then appeared justified dismissal. Since that time, this litigation has proceeded apace with extensive pre-trial proceedings. Five judges of this court
have considered and decided various contentions of the parties as to the proper mode of proceeding. A Special Master has been appointed to conduct the taking of depositions and since his appointment has presided a total of 104 days. Numerous witnesses have been extensively examined by plaintiffs and defendants. Between June, 1948 and July 15, 1949, 25,000 pages of testimony have been adduced and well over 100,000 documents examined by adverse parties. In addition, defendants have requested and obtained plaintiffs' consent to the filing of an amended answer which raises new issues. This answer charges that plaintiffs conspired to monopolize the tractor industry on an international scale. Defendants now move for transfer.
The section of the new Judicial Code, which they invoke, provides that, 'For the convenience of the 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.' 28 U.S.C.A. § 1404(a).
This provision, enacted subsequent to my opinion of April 21, 1948, applies to a 'civil action' brought under the anti-trust laws as well as under other laws with special venue provisions. United States v. National City Lines, 1949, 337 U.S. 78, 69 S. Ct. 955; Ex parte Collett, 1949, 337 U.S. 55, 69 S. Ct. 944, 959.
This change in the law clearly disposes of the first ground of my denial of defendants' motion to dismiss, but there remains the second ground- that on the factual merits the doctrine of forum non conveniens was not applicable. Plaintiffs urge that this ruling established the 'law of the case.'
Admittedly only one motion of this nature should ordinarily be entertained in an action. However, it is clear that in this situation, defendants have the right to move for transfer. The change in the law is procedural and they may take advantage of it. United States v. National City Lines, supra; Amalgamated Ass'n etc. v. Southern Bus Lines, 5 Cir., 1949, 172 F.2d 946.
1. Has This Court Power to Transfer under Section 1404(a)?
Plaintiffs contend that defendant Sherman Tractor Co., is not doing business in Michigan and that consequently this action against it is not one which, under the language of the statute, 'might have been brought' in Michigan. They conclude that transfer to Michigan is beyond the power of this court, since Sec. 1404(a) requires the transferee district to be one 'where (the action) might have been brought', and constitutes a legislative adoption of that element of the non-statutory forum non conveniens rule which presupposes as a condition to its application that defendant be amenable to service of process in the assertedly more convenient and non-oppressive forum, and precludes its application except to furnish criteria for choice between two districts where venue is concededly proper. See, Gulf Oil Corp. v. Gilbert, 1947, 330 U.S. 501, 506-507, 67 S. Ct. 839, 91 L. Ed. 1055. Plaintiffs support this by reference to the legislative history of the section, to the construction it has received and to the understanding of authorities familiar with the history and purpose of the provision. See, Reviser's Note to 1404(a) in the second draft of the Code, May, 1945 and memorandum of Prof. J. W. Moore dated March 7, 1945 (therein set forth); Haves v. Chicago, R.I. & P.R. Co., D.C. Minn. 1948, 79 F.Supp. 821; Christopher v. American News Co., 7 Cir., 1949, 176 F.2d 11; Walsh v. Pullman Co., D.C.S.D.N.Y. 1949, 89 F.Supp. 762; 3 Moore's Federal Practice, 2139(n.87), 2141 (1948 Ed.).
In opposition, defendants urge (1) that 'might have been brought' means that the transferee forum must have jurisdiction over the subject matter, (2) that this language merely requires that plaintiff have capacity to sue in the transferee jurisdiction, (3) that at any rate, Sherman Tractor Co. consents to waive any venue objection it has in the transferee forum, and (4) that since the latter joins in the motion it is thereafter estopped from raising objections to such forum.
I must reject defendants' construction of the statute. I have no doubt that the statutory language 'where it might have been brought' is a legislative adoption of that condition of the application of forum non conveniens, which requires proper venue in at least two forums. Gulf Oil Corp. v. Gilbert, supra; Reviser's note and memorandum to second draft of Code, 1404(a); Haves v. Chicago, R.I. & P.R. Co., supra; Cinema Amusements v. Loew's, Inc., D.C. Del. 1949, 85 F.Supp. 319; Greve v. Gibraltar Enterprises, D.C.N. Mex. 1949, 85 F.Supp. 410, 412-413; Walsh v. Pullman Co., supra; Keller-Dorian Colorfilm Corp. v. Eastman Kodak Co., D.C.S.D.N.Y. 1949, 88 F.Supp. 863; 3 Moore's Federal Practice, supra. The construction which defendants urge on me is plainly a strained effort to avoid the undesirable effect on them that the legislative history of the statute would appear to require.
The more difficult problem is whether Section 1404(a) requires that venue in the transferee forum be proper as to every one of a number of defendants before transfer may be ordered. Defendants urge that the statutory condition is satisfied if the transferee forum would have been a proper venue as to some of them. They argue that the action has been successfully brought in New York, notwithstanding the fact that this City is an improper forum as to some of the defendants. They conclude by the same reasoning that the action might have been brought in the venue sense in Detroit even though venue there is improper as to one of them, and that consequently transfer may be ordered.
The legislative history of the section does not indicate that any thought was given to the problem of multiple defendants.
Nor do the cases answer the problem directly. Although United States v. National City Lines, supra, seems highly relevant there is no discussion of the problem here present in any of the opinions there rendered.
Nevertheless, in that case, the Supreme Court affirmed a transfer in a situation factually similar to the one at hand. There, sixteen defendants were joined in one action brought under The Sherman Act, 15 U.S.C.A. § 1 et seq., by the government. A motion under Section 1404(a) for transfer to Illinois was granted. No finding was made that all the defendants were amenable to process in Illinois; however, in an earlier motion to dismiss under the doctrine of forum non conveniens, the trial court accepted a stipulation from defendants they they would not raise the question of whether the forum in whose favor jurisdiction was declined would be a proper venue as to all defendants under Section 5 of the Sherman Act, which controlled venue in that case.
This stipulation was before the court in the motion under Section 1404(a), see, 80 F.Supp. 734, 743, and apparently satisfied the District Court that the action was properly transferable under Section 1404(a). That transfer was affirmed by the Supreme Court, 337 U.S. 78, 69 S. Ct. 955, although it was not clear that all defendants were amenable to suit in the transferee forum except by virtue of their consent and stipulation. Thus, if the statutory condition is construed as requiring venue as to all defendants in the transferee forum before transfer can be ordered, I must conclude that National City Lines was, on its facts, wrongly decided by the Supreme Court. I believe I might so hold, since the issue was not argued to the Court and the Court did not purport to make any determination on the question, but I think it more desirable and appropriate to construe the statute so that that decision is consistent with it.
Such a result is possible, if the statutory condition is construed as requiring the transferee forum to be a proper venue as to at least one of the defendants in a multi-defendant case; in such a situation it can fairly be said that the action might have been brought there in a venue sense. Once the statutory condition is met, the result in the National City Lines case suggests that another condition is appropriate: the defendants as to whom the transferee forum is improper must consent to the transfer.
If such consent is not given the court would be faced with the problem of forcing defendants not amenable to suit in a transferee jurisdiction to defend themselves there nonetheless, or requiring plaintiff to take a severance. Fortunately, I am not faced with this problem and express no opinion on it.
It is true that under the old forum non conveniens doctrine, it was certainly questionable whether a defendant could invoke the doctrine by consenting to be sued in a district where there was improper venue, even in a multi-defendant case. See, Tivoli Realty v. Interstate Circuit, 5 Cir., 1948, 167 F.2d 155, 156-157, certiorari denied 334 U.S. 837, 68 S. Ct. 1494, 92 L. Ed. 1762. Indeed, in deciding the earlier motion to dismiss in this case, I held that such consent was insufficient to invoke the doctrine and that venue must exist as to the defendant independent of any stipulation. The reason for such requirement is clear; such a stipulation in one case might be ineffective in the subsequent action in another forum, brought after dismissal of the first case. The venue in the new forum being improper as to the defendant, such defendant would not be amenable to service of process there, and the earlier stipulation would not of a certainty overcome this defect. In the event that the defendant was not available for service, the plaintiff would have to commence a new action in some place where the defendant might be found- possibly in the same forum where the first action had been dismissed. In the meantime the statute of limitations might have run. It would be improper to subject plaintiff to such uncertainties by dismissing the first action.
No such problem now exists. No new process need be served when an action is transferred and there is no question of the statute of limitations. There is, consequently, no practical reason requiring that the transferee forum be a proper venue as to all of several defendants. It is sufficient that the transferee forum be, and highly so, more convenient to all parties and witnesses, that it be a proper venue as to at least one defendant and that the other defendants ...