The opinion of the court was delivered by: SPATT
In this antitrust action filed on March 25, 1996, all of the defendants moved the Court for an order transferring venue to the Northern District of California.
In an Order dated July 1, 1996, the Court (1) denied a motion by the defendants' to dismiss the complaint as to a group boycott claim; (2) granted the defendants' motion to dismiss a price fixing claim; (3) gave leave to the plaintiff to replead a price fixing claim; and (4) denied the defendants' motion to dismiss the action in deference to a pending state court action.
The background of the case was set forth in the Court's oral decision on the record on June 30, 1996 and will not be repeated here.
This written decision follows a oral decision rendered on the record on August 30, 1996.
A. A motion to transfer venue
A motion to change venue from one federal district court to another, when venue is initially proper, is governed by 28 U.S.C. § 1404, which provides in pertinent part:
(a) for the convenience of the parties and witnesses, in the interests of justice, a district court may transfer any civil action to any other district or division where it might have been brought.
The goal 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, 616, 84 S. Ct. 805, 11 L. Ed. 2d 945 (1964) (quoting Continental Grain Co. v. Barge FBL-585, 364 U.S. 19, 26-27, 80 S. Ct. 1470, 4 L. Ed. 2d 1540 (1960)); see also Launer v. Buena Vista Winery, Inc., 916 F. Supp. 204 (E.D.N.Y. 1996); Hernandez v. Graebel Van Lines, 761 F. Supp. 983 (E.D.N.Y. 1991).
The inquiry on a motion to transfer venue is two fold. First, the Court must determine whether the action sought to be transferred is one that "might have been brought" in the district court in which the movant seeks to have the case litigated, the so-called "transferee court." If so, the second issue for the court to resolve is whether the "convenience of the parties and witnesses" and the "interest of justice," a transfer to the proposed district is appropriate. The movant bears the burden of clearly establishing that a transfer is appropriate and that the motion should be granted. See Factors Etc., Inc. v. Pro Arts Inc., 579 F.2d 215, 218-19 (2d Cir. 1978), cert. denied, 440 U.S. 908, 59 L. Ed. 2d 455, 99 S. Ct. 1215 (1979).
1. "Might Have Been Brought":
(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 may be found, if there is no district in which the action may otherwise be brought.
28 U.S.C. § 1391(b). Fifteen of the eighteen defendants reside in California (thirteen of those reside and have their principal place of business in the Northern District of California; one is sited in the Eastern District of California and one is sited in the Southern District of California).
Philip O. Stafford d/b/a USA Wine Imports, described in the complaint as an "individual conducting business as a licensed importer and distributor in the States of New York and New Jersey, is also licensed as a wine and beer distributor by the State of California, has an office located Berkeley, CA (which is within the N.D.Cal) and would therefore be subject to personal jurisdiction in the Northern District of CA. Whether the individual defendants Bass and Millman, who are residents of New York, would have consented to personal jurisdiction had the case been commenced in the Northern District of California, is unknown. See Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1877) (consent, service within the state and domicile are the traditional bases of jurisdiction). They now do not oppose the motion to transfer venue. However, as the plaintiff notes, the Court should assess the situation as it existed when the complaint was filed, irrespective of subsequent consent or waiver. See Hoffman v. Blaski, 363 U.S. 335, 343, 4 L. Ed. 2d 1254, 80 S. Ct. 1084 (1960).
In the Court's view, based on the facts alleged in the complaint, Bass and Millman had sufficient contacts with the State of California to subject them to personal jurisdiction in that state without offending "traditional notions of fair play and substantial justice." See International Shoe v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945) and Cal. Code Civ. Proc. § 410.10 (permitting courts to exercise jurisdiction on any basis not inconsistent with the Constitution of California or the United States).
The plaintiff's argument that "at no time have defendants Bass and Millman conducted and/or transacted business, as individuals in California" contradicts the facts pled in the complaint and is not supported by law. Individuals who are subject to personal jurisdiction are not protected by a "fiduciary shield" because they acted on behalf of their corporation. See e.g., Retail Software Servs. v. Lashlee, 854 F.2d 18, 22-23 (2d Cir. 1988); Davis v. Metro Prods., Inc., 885 F.2d 515, 521 (9th Cir. 1989). Furthermore, the conduct by Bass and Millman that is alleged to be wrongful is that on their excursions to California they conspired with others to the detriment of their employer, the plaintiff corporation, in violation of the antitrust laws. The complaint alleges that Bass and Millman, although dispatched to California under the auspices of WMI's marketing initiative, did not act on behalf of WMI, but rather made efforts for their own benefit that were against WMI's interests and in violation of the antitrust laws. The complaint alleges that Bass and Millman pursued a "secret agenda," were disloyal to their employer WMI, plotted to steal the business of the defendant wine suppliers and took advantage of the California business development trips to do so. Discussing California's long arm jurisdiction, it has been noted that
Anglo American Ins. Group v. CalFed Inc., 916 F. Supp. 1324, 1330 (S.D.N.Y. 1996). To demonstrate that California has limited jurisdiction over Bass and Millman, the moving ...