The opinion of the court was delivered by: Robert P. Patterson, Jr., U.S.D.J.
On July 21, 2008, Defendant Village Resorts filed a motion pursuant to Fed. R. Civ. P. 12(b) to dismiss this action on the grounds of lack of jurisdiction and improper venue. In the alternative, Defendant moved to transfer this case to the Northern District of Illinois pursuant to 28 U.S.C. § 1404. Argument on this motion was held on September 25, 2008. Thereafter, the parties engaged in unsuccessful settlement negotiations necessitating the resolution of Defendant's motion. For the reasons set forth below, Defendant's motion to dismiss is denied. Defendant's motion to transfer this case to the Northern District of Illinois is granted.
Defendant Village Resorts, Inc, doing business as The Purple Hotel, was licensed by the state of Illinois to operate a hotel/motel business in the town of Lincolnwood, Illinois. (Plaintiffs' 05/05/2008 Complaint ("Compl.") ¶¶ 9-10.) Pursuant to the terms of a collective bargaining agreement between Defendant and the Hotel Employees and Restaurant Employees International Union Pension Fund (the "HEREIU Pension Fund"), through December 31, 2005, Defendant had an obligation to contribute to the HEREIU Pension Fund. (Compl. ¶¶ 11, 14-15.) The HEREIU Pension Fund is a defined pension plan within the meaning of Section 3(35) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1002(35). (Compl. ¶¶ 5-6.)
As of December 31, 2006, an acceptable collective bargaining agreement between Defendant and the HEREIU Pension Fund had not been reached, and also as of that date, the HEREIU Pension Fund had not received a written request for an extension of time pursuant to the One-Year Resolution Policy. (Compl. ¶¶ 16-17.) Because of this, Defendant incurred a complete withdrawal from the HEREIU Pension Fund, assuming complete withdrawal liability under Section 4201 of ERISA, 29 U.S.C. § 1381. (Id. ¶¶ 18-19.) By letter dated February 23, 2007, the HEREIU Pension Fund notified Defendant that it owed the HEREIU Pension Fund withdrawal liability in the estimated amount of $531,206.59, to be paid in sixty-one monthly installments of $10,415.14 each, commencing on April 24, 2007 plus a final payment of $8,644.57. (Id. ¶ 20.)
By letter dated May 2, 2007, the HEREIU Pension Fund notified counsel for Defendant that Defendant had failed to make the first monthly payment due on April 24, 2007. (Compl. ¶ 21.) The letter threatened lawsuit if the delinquency was not cured with ten days. (Id.) The HEREIU Pension Fund sent a second letter to Defendant on May 15, 2007, notifying Defendant that it had failed to make the first monthly installment due on April 24, 2007, and that Defendant's failure to pay would constitute a default permitting acceleration of Defendant's withdrawal liability if the first installment plus interest was not paid within sixty days. (Id. ¶ 22.) The HEREIU Pension Fund did not receive Defendant's first monthly installment within 60 days of the May 15, 2007 letter. (Id. ¶ 23.)
On September 30, 2007, the HEREIU Pension Fund merged into and became part of Plaintiff's Fund, the UNITE HERE National Retirement Fund (the "Fund"). (Compl. ¶ 12.) The Fund is "administered in part. at 730 Broadway, New York, New York 10003," which is located in the "Southern District of New York." (Id. ¶ 3.) On May 5, 2008, Plaintiffs filed this current action under Sections 502(a)(3) and 4301(a) of ERISA in the Southern District of New York, demanding full payment of Defendant's outstanding withdrawal liability ($531,782.61) as well as liquidated damages and attorneys' fees under 29 U.S.C. § 1399(c)(5). (Id. ¶¶ 27-30.)
On July 22, 2008, Defendant filed the current motion, alleging that under the ERISA jurisdictional provisions, this Court lacked personal jurisdiction over Defendant to hear this matter. In the alternative, Defendant requested that this Court exercise its discretion and transfer this case to the Northern District of Illinois.
A. Personal Jurisdiction over Defendant
In the jurisdiction provision of ERISA, subsection 2 provides that "[w]here an action under this subchapter is brought in a district court of the United States, it may be brought in the district where the plan is administered, where the breach took place, or where a defendant resides or may be found." See 29 U.S.C. § 1132(e); see, e.g., Local 8A-28A Welfare v. Golden Eagles, 277 F. Supp. 2d 291, 295-95 (S.D.N.Y. 2003); American Medical Association v. United Healthcare, 2001 U.S. Dist. LEXIS 10818 (S.D.N.Y. 2001).
This Complaint alleges jurisdiction under 29 U.S.C. 1132(e)(2) "because the Fund is administered in part in the Southern District of New York." (Compl. ¶ 3.) Defendant moves to dismiss the Complaint as facially insufficient, arguing that personal jurisdiction in the Southern District of New York is lacking because while an ERISA action may be brought "in the district where the plan is administered," here, the plan is administered only "in part" in the Southern District of New York.*fn1 (Defendant's 07/22/08 Memorandum of Law in Support of Motion to Dismiss ("Def. Memo") at 3.) According to Defendant, "had the legislature wanted 'partial' administration to form a basis for venue, it would have so stated in the statute." (Def. Memo at 3.)
In opposition to Defendant's motion to dismiss, Plaintiff has produced an affidavit from Richard Rust, the "Fund Manager of the UNITE HERE National Retirement Fund." (08/4/2008 Affidavit of Richard Rust ("Rust Aff.") ¶ 1.) Rust averred that personal jurisdiction is proper in the Southern District of New York because: the Fund's administrative offices are located both in New York City and Lincoln, Rhode Island; the Fund's legal counsel is located in New York City; the Fund's Board of Trustees "meets regularly in New York," and; "various Board of Trustee Committee meetings routinely take place in New York." (Rust Aff. ¶¶ 3-5.)
The question presented is whether such averments are sufficient to support a finding by this Court that under the terms of 29 U.S.C. § 1132(e), the Fund "is administered" in the Southern District of New York. If not, it is agreed that there is no other basis for finding jurisdiction proper in this district. This Court concludes that at this stage of the proceedings the aforementioned averments present "legally sufficient allegations of jurisdiction." See Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir. 1990) ("Prior to discovery, a plaintiff challenged by a jurisdiction testing motion may defeat the motion by pleading in good faith, see ...