Transamerican Equipment Company LLC v. Industrial Assets Corp et al

Filing 20

MEMORANDUM OF OPINION. Signed by Judge L Scott Coogler on 2/12/2018. (PSM)

FILED
2018 Feb-12 PM 03:54
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
WESTERN DISTRICT
)
)
TRANSAMERICAN EQUIPMENT
)
COMPANY, LLC,
)
)
Plaintiff,
)
)
7:17-CV-00481-LSC
v.
)
)
INDUSTRIAL ASSETS CORP., et
)
al.
)
)
Defendants.

MEMORANDUM OF OPINION
Plaintiff, Transamerican Equipment Company, LLC (“Transamerican” or
“Plaintiff”), originally filed this action in the Circuit Court of Tuscaloosa County,
Alabama seeking compensatory and punitive damages resulting from an auction
sale alleging fraudulent suppression, fraud and fraudulent inducement, conspiracy,
breach of contract, and violation of two North Carolina statutes including Chapter
85B, Section 8 of the North Carolina General Statutes (the Auctioneer Statute),
and North Carolina Generate Statute § 75-1.1 (the Deceptive Trade Practices Act).
Defendants, Industrial Assets Corp. (“IAC”), Maynards Industries USA, LLC
(“Maynards”), and Utica Leaseco, LLC (“Utica”) (collectively “Defendants”),
then removed the action to this Court. (Doc. 1.) Before the Court is Utica’s Motion
Page 1 of 21

to dismiss (doc. 2), IAC and Maynards’ Motion to change venue (doc. 3),
Transamerican’s Motion to remand (doc. 11) and Transamerican’s Motion for
discovery (doc. 12).
I.

BACKGROUND 1
On December 1, 2016, Plaintiff participated in an auction (“the Auction”)

held online to sell equipment located in Enka, North Carolina. Maynards was the
auctioneer of the Auction, and Utica the seller and owner of the equipment. IAC is
alleged to have been working in concert with Maynards and Utica in the sale of the
goods and the collection of the purchase funds from Plaintiff. Maynards is a
Delaware limited liability company with its principal place of business in Delaware.
Utica is a Florida limited liability company with its principal place of business in
Michigan. IAC is a California business corporation with its principal place of
business in California. Transamerican is a limited liability company organized
under Alabama law which has an Alabama citizen as its sole member.
The Auction was accessible through multiple online platforms and was
governed by the terms and conditions set forth on Bidspotter, an online auction
platform. No other contract between Defendants and Plaintiff was formed. The
Auction was advertised via the Biditup website and Transamerican accessed and
1

The following facts are taken from Plaintiff’s complaint, and the Court makes no ruling on their
veracity.
Page 2 of 21

bid in the Auction through the Bidspotter platform from its office in Tuscaloosa,
Alabama. Defendants directed correspondence to Transamerican regarding the
auction and the equipment sold. During the Auction, Transamerican noticed
irregular bidding activity and became suspicious that the owner of the equipment
may have been secretly placing shill 2 bids to increase the final bid price of the
equipment.
In the week following the Auction, Transamerican contacted Maynards in
order to schedule payment and removal of the equipment. According to Plaintiff,
Maynards, Utica, and IAC began sending fraudulent correspondence, claiming it
had agreed to burdensome terms and conditions. Maynards, Utica, and IAC
threatened litigation by consent judgment to be filed in Burbank, California if
Transamerican did not immediately comply. After weeks of negotiation, Maynards
and Utica agreed to a different removal schedule. Transamerican claims that during
negotiations, Maynards admitted to having entered shill bids on behalf of Utica in
order to drive up the price at auction. 3 Despite this admission, Plaintiff closed on
the equipment sale by wiring funds to Maynards on February 10, 2017.
II.

PLAINTIFF’S MOTION TO REMAND (Doc. 11)

2

Shill bidding is defined as, “(on an online auction) the illegal practice of a seller or a seller’s
acquaintances placing bids on his or her goods in order to drive up the price.” Collins Dictionary,
https://www.collinsdictionary.com/us/dictionary/english/shill-bidding.
3
The Auction was not advertised as a reserve auction. (See Doc. 1 at 19; Doc. 14-2.)
Page 3 of 21

A. Removal Standard of Review
This Court, like all federal courts, is a court of “limited jurisdiction.”
Jackson-Platts v. Gen. Elec. Capital Corp., 727 F.3d 1127, 1134 (11th Cir. 2013). It is
authorized to hear only those cases falling within “one of three types of subject
matter jurisdiction: (1) jurisdiction under a specific statutory grant; (2) federal
question jurisdiction pursuant to 28 U.S.C. § 1331; or (3) diversity jurisdiction
pursuant to 28 U.S.C. § 1332(a).” PTA-FLA, Inc. v. ZTE USA, Inc., 844 F.3d 1299,
1305 (11th Cir. 2016). A defendant may remove an action initially filed in state
court to federal court if the action is one over which the federal court has original
jurisdiction. 28 U.S.C. § 1441(a). “[A] defendant seeking to remove a case to a
federal court must file in the federal forum a notice of removal ‘containing a short
and plain statement of the grounds for removal.’” Dart Cherokee Basin Operating
Co. v. Owens, 135 S. Ct. 547, 553 (2014) (quoting 28 U.S.C. § 1446(a)). For removal
to be proper, the court must have subject-matter jurisdiction in the case. See
Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). Because Defendants removed
this action, Maynards, Utica, and IAC have the burden of establishing that the case
was properly removed. See Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97
(1921). Any doubt about the existence of federal jurisdiction “should be resolved in

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favor of remand to state court.” City of Vestavia Hills v. Gen. Fid. Ins. Co., 676 F.3d
1310, 1313 (11th Cir. 2012) (internal citations omitted)).
B. Discussion of Plaintiff’s Motion to Remand
Transamerican contends that the case must be remanded due to a facial
defect in the notice of removal; contending that because the identity of all members
of Maynards LLC and Utica LLC, and their respective citizenships, were not
alleged in the Notice of Removal it was improper. 4
To establish diversity jurisdiction under 28 U.S.C. § 1332, each party must
be completely diverse, with no plaintiff’s citizenship overlapping any defendant’s
citizenship. 5 Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998).
Indeed, “diversity jurisdiction in a suit by or against the entity depends on the
citizenship of ‘all the members . . . .’” Carden v. Arkoma, Assocs., 494 U.S. 185, 195
(1990) (internal citations omitted). For example, “[t]o sufficiently allege the
citizenships of these unincorporated business entities, a party must list the
citizenships of all the members of the limited liability company . . . .” Rolling Greens

4

Plaintiff does not contest that IAC is diverse. (See Doc. 11 at 4.)
Plaintiff bases its argument for defeating subject matter jurisdiction upon the lack of complete
diversity, not on a failure to meet the amount in controversy requirement. For this Court to have
jurisdiction, the amount in controversy must exceed $75,000. According to Defendants, Plaintiff
made an initial bid of $150,000 at the auction and Utica then bid $152,500. After a series of bids,
Plaintiff placed a winning bid of $265,000. Thus, the amount in controversy requirement of 28
U.S.C. §1332 is considered satisfied. As such, the Court addresses only whether complete
diversity is present. (See Doc. 1.)
5

Page 5 of 21

MHP, L.P. v. Comcast SCH Holdings, L.L.C., 374 F.3d 1020, 1022 (11th Cir. 2004)
(“a limited liability company is a citizen of any state of which a member of the
company is a citizen.”). An individual is a citizen of the state in which he is
domiciled. 6 See Mas v. Perry, 489 F.2d 1396, 1399 (5th Cir. 1974). 7
Here, in the Notice of Removal, Defendants neither identified the individual
members of the LLCs, Maynards and Utica, nor did they allege the citizenship of
each member. (See Doc 1.) Defendants do, however, allege the identities and
citizenships of each member in their Response to the Motion to Remand and
Supplement to Notice of Removal. (See Doc 19.) Pursuant to 28 U.S.C. §1653, “[i]f
a party fails to specifically allege citizenship in their notice of removal, the district
court should allow that party ‘to cure the omission’ as authorized by § 1653.” Corp.
Mgmt. Advisors, Inc. v. Artjen Complexus, Inc., 561 F.3d 1294, 1297 (11th Cir. 2009)
(citations omitted). When determining whether a party has met the burden of
proving diversity, the Court considers all of the evidence, both presented with the
notice of removal, as well as that evidence submitted in response to the Motion to

6

Domicile is defined as the place of “[one’s] true, fixed, and permanent home and principal
establishment, and to which [one] has the intention of returning whenever [one] is absent
therefrom . . . .”. Id. (internal quotations and citations omitted).
7
Pursuant to Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), decisions
of the former Fifth Circuit handed down before the close of business on September 30, 1981 are
binding on this Court. See Slater v. U.S. Steel Corp., 871 F.3d 1174 n.5 (11th Cir. 2017).
Page 6 of 21

Remand. See Pretka v. Kolter City Plaza II, Inc., 608 F.3d 744, 753-55 (11th Cir.
2010).
Here, Defendants alleged the citizenship of all the members, including the
respective trustees and beneficiaries, of both LLCs—Maynards and Utica—in their
Response, showing in detail that all entities and members comprising the LLCs
were all either citizens of Michigan or are domiciled in Michigan. Thus, the Court
finds that Defendants have alleged enough in the body of their Response and
Supplement to Notice of Removal, in conjunction with the attached affidavits, to
establish that no citizenship of any Defendant overlapped with that of Plaintiff.
Because complete diversity existed and the jurisdictional amount was met when
Defendants’ removed this action, the motion to remand is due to be DENIED.
III. UTICA’S MOTION TO DISMISS (DOC. 2) 8
A. Standard for 12(b)(2) Motion to Dismiss

8

Plaintiff also filed a Motion for Jurisdictional Discovery requesting Interrogatories and Requests
for Production Limited to Personal Jurisdiction Issues to Utica, Maynards and IAC; in addition
to depositions of corporate representatives of each Defendant. (Doc. 12.) “[W]hen facts that go
to the merits and the court’s jurisdiction are intertwined and genuinely in dispute, [a] part[y]
ha[s] a ‘qualified right to jurisdictional discovery,’” unless that party unduly delayed in seeking
leave to initiate discovery. Am. Civil Liberties Union of Fla., Inc. v. City of Sarasota, 859 F.3d 1337,
1341 (11th Cir. 2017) (quoting Eaton v. Dorchester Dev., Inc., 692 F.2d 727, 730 (11th Cir. 1982)).
Plaintiff cited Eaton v. Dorchester Dev., Inc., 692 F.2d 727, 730 (11th Cir. 1982) in support of its
Motion. The case is distinguishable from this one in that in Eaton, jurisdiction was based upon
the Interstate Land Sales Full Disclosure Act, and not of upon diversity of citizenship as it is
here. See id. at 731. Because the Court finds that Defendants’ supplement to their Notice of
Removal is sufficient, Plaintiff’s Motion for Discovery is due to be terminated as MOOT.
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In a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, the
plaintiff generally “bears the burden of establishing a prima facie case of
jurisdiction over the movant, non-resident defendant.” Morris v. SSE, Inc., 843
F.2d 489, 492 (11th Cir. 1988) (citing Delong Equip. Co. v. Washington Mills
Abrasive Co., 840 F.2d 843, 845 (11th Cir. 1988)). “A prima facie case is established
if the plaintiff presents enough evidence to withstand a motion for directed
verdict.” Madara v. Hall, 916 F.2d 1510, 1514 (11th Cir. 1990). The Court must
treat facts alleged in the complaint as true if they are not controverted by affidavits
submitted from the defendant. Id. However, if the defendant submits affidavits, the
plaintiff must produce additional evidence supporting jurisdiction unless the
defendants’ affidavits are only conclusory. Stubbs v. Wyndham Nassau Resort &
Crystal Palace Casino, 447 F.3d 1357, 1360 (11th Cir. 2006). When the plaintiff’s
evidence conflicts with the defendant’s evidence, the Court must “construe all
reasonable inferences in favor of the plaintiff.” Id.
B. Discussion of Utica’s Motion to Dismiss
“A federal district court sitting in diversity may exercise personal
jurisdiction to the extent authorized by the law of the state in which it sits and to
the extent allowed under the Constitution.” Meier ex rel. Meier v. Sun Int’l Hotels,
Ltd., 288 F.3d 1264, 1269 (11th Cir. 2002); see also Daimler AG v. Bauman, 134 S.
Page 8 of 21

Ct. 746, 753 (2014) (“Federal courts ordinarily follow state law in determining the
bounds of their jurisdiction over persons.”). Personal jurisdiction is generally a
two-step inquiry, as the Court must consider whether personal jurisdiction is
consistent with the forum state’s long-arm statute and whether the exercise of
personal jurisdiction is consistent with the Due Process Clause of the Fourteenth
Amendment. Mut. Serv. Ins. Co. v. Frit Indus., Inc., 358 F.3d 1312, 1319 (11th Cir.
2004). Here, “the two inquiries merge, because Alabama's long-arm statute
permits the exercise of personal jurisdiction to the fullest extent constitutionally
permissible.” Sloss Inds. Corp. v. Eurisol, 488 F.3d 922 (11th Cir. 2007); see also Ex
Parte Edgetech I.G., Inc., 159 So. 3d 629, 633 (Ala. 2014). Thus, the Court need only
consider the limits of the Due Process Clause. Mut. Serv. Ins. Co., 358 F.3d at 1319.
“[D]ue process requires only that in order to subject a defendant to a
judgment in personam, if he be not present within the territory of the forum, he
have certain minimum contacts with it such that the maintenance of the suit does
not offend ‘traditional notions of fair play and substantial justice.’” Int’l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463
(1940)). There are two types of personal jurisdiction—general jurisdiction and
specific jurisdiction—but both are based on the defendant’s contacts with the
forum state.
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While “[a] physical presence in Alabama is not a prerequisite to personal
jurisdiction over a nonresident[;] . . . the defendant [must] have such contacts with
Alabama that it should reasonably anticipate being haled into court [here].” Ex
parte Dill, Dill, Carr, Stonbraker & Hutchings, P.C., 866 So. 2d 519 (Ala. 2003)
(internal quotations and citations omitted). Determining whether jurisdiction is
general or specific hinges upon both the quality and quantity of the contacts.
“General jurisdiction applies where a defendant's activities in the forum state are
substantial or continuous and systematic, regardless of whether those activities
gave rise to the lawsuit . . . . A court has specific jurisdiction when a defendant has
had few contacts with the forum state, but those contacts gave rise to the lawsuit.”
Leventhal v. Harrelson, 723 So. 2d 566, 569 (Ala. 1998) (internal quotations and
citations omitted).
i. Agency theory of jurisdiction
Plaintiff argues that Utica is subject to personal jurisdiction as a result of its
agency relationship with Maynards and IAC. Utica has conceded that it authorized
Maynard and IAC to conduct the Auction on its behalf. (See Notice of Removal,
Doc. 1 at 2-3) (“In fact, IAC was working together with Maynards as the auctioneer
on behalf of Utica.”). Transamerican also argues that Utica ratified the conduct of
its agents by accepting Plaintiff’s money and therefore the agency relationship
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between the Defendants is indisputable. (See Doc. 14 at 5); see Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 480 n. 22 (1985) (recognizing for purposes of personal
jurisdiction that commercial activities performed on a party's behalf “may
sometimes be ascribed to the party”); see also Daynard v. Ness, Motley, Loadholt,
Richardson & Poole, P.A., 290 F.3d 42, 55–60 (1st Cir. 2002) (agent's acts may be
attributed to principal for jurisdictional purposes when, under standard agency
principles, agent is authorized to act on behalf of principal or principal ratifies
agent's conduct).
Utica has pointed to several persuasive examples of courts being unwilling to
extend personal jurisdiction over defendants who have used online bidding
platforms, such as the ones used in the auction at issue here. However, none are
binding. If only the shill bidding were at issue, the Court might be inclined to agree
with Utica that putting up an item for sale in an auction that is available to anyone
in the country is not sufficient contact with the forum. However, the shill bidding
is not the only issue. Plaintiff has also alleged that both Maynards and IAC, on
behalf of Utica, directed fraudulent telephone and electronic correspondence to
Plaintiff in Alabama with the purpose of coercing it into onerous shipping and
payment terms. These contacts were purposeful and ongoing. They not only had
an effect in Alabama, but caused Transamerican to put itself in a detrimental
Page 11 of 21

position.

It is reasonable to conclude therefore that Maynards and IAC

purposefully availed themselves of the forum, and, because they were acting on
behalf of Utica, Utica has also.

Further, because Maynards conducts and

advertises its auctions in Alabama with some regularity, (see e.g. Doc. 14-1),
Alabama has a particular interest in ensuring fair and ethical business practices for
its citizens and businesses. In light of Maynards’ and IAC’s contacts with the
forum, and the agency relationship amongst the three entities, Utica has
purposefully availed itself of the privileges of conducting activities in Alabama. In
doing so, Utica “received the benefits and protection of the laws of the state” and
is therefore subject to personal jurisdiction in Alabama. Int'l Shoe, 326 U.S. at 320.
ii. Jurisdiction under the Conspiracy theory
In the Complaint, Transamerican averred that “[d]efendants acted in
concert to accomplish the tortious and unlawful aims set forth [in the Complaint].”
(Complaint, Doc 1 at 22.) Transamerican argues that Utica is subject to personal
jurisdiction in Alabama because it conspired with Maynards and IAC to unlawfully
drive up the final price of the equipment by placing shill bids. “Alabama courts
have recognized that, in an appropriate case, specific jurisdiction can be based upon
the purposeful conspiratorial activity of a nonresident defendant aimed at an
Alabama plaintiff.” Ex parte Alamo Title Co., 128 So. 3d 700, 713 (Ala. 2013)
Page 12 of 21

(internal citations omitted). To establish personal jurisdiction under a conspiracy
theory, “the plaintiff must plead with particularity the conspiracy as well as the
overt acts within the forum taken in furtherance of the conspiracy.” Id. (quoting Ex
parte McInnis, 820 So. 2d 795, 806-07 (Ala. 2001) (internal quotations omitted)).
Civil conspiracy in Alabama involves two elements: (1) concerted action by two or
more persons (2) to achieve an unlawful purpose or a lawful purpose by unlawful
means. See Luck v. Primus Auto. Fin. Servs., Inc., 763 So. 2d 243, 247 (Ala. 2000).
“Bald speculation or a conclusory statement that individuals are co-conspirators is
insufficient to establish personal jurisdiction under a conspiracy theory.” Ex parte
McInnis, 820 So. 2d at 806 (internal quotations and citations omitted). However,
the burden of proof here “is not heavy, especially ‘when determination of the
jurisdictional facts is intertwined with and may be dispositive of questions of
ultimate liability.’” Ex parte Reindel, 963 So. 2d 614, 623 (Ala. 2007) (internal
citations omitted). Further, it is not necessary that the overt act physically take
place within the forum state. See Bowman v. Hodge Mgmt. Group, LLC, 2016 WL
3483170 at *6 (M.D. Ala., June 27, 2016) (finding a single phone call to the plaintiff
in furtherance of the conspiracy a sufficient overt act) (citing Corp. Waste Alts., Inc.
v. McLane, 896 So. 2d 410, 413 (Ala. 2004); see also Wenger Tree Serv. v. Royal Ruck
& Equip., Inc., 853 So. 2d 888, 895-96 (Ala. 2002)(stating that a nonresident
Page 13 of 21

defendant “should reasonably anticipate being haled into court” where its
commercial efforts are “purposefully directed” toward a resident of another
state)).
Plaintiff alleges in the Complaint that Defendants worked together to send
fraudulent correspondence to Plaintiff in Alabama in order to “coerce Plaintiff into
closing a transaction that involved fraudulent bidding.” (Complaint, Doc. 1 at 21.)
Because the nature of a conspiracy allegation is such that it can be fleshed out in
greater detail through the discovery process, the Court finds that Plaintiff has pled
its conspiracy claims sufficiently enough to meet the burden of proof for
jurisdictional purposes by alleging that Maynards, Utica, and IAC worked together
to commit certain acts in furtherance of the conspiracy. (See e.g. Complaint, Doc. 1
at 18) (“Upon information and belief, IAC was acting in concert with Utica in the
sale of the Goods and the collection of purchase funds from Plaintiff.”). Moreover,
the overt act alleged in the Complaint is one of correspondence into the forum
state. 9 Like the phone call that was sufficient in Bowman, Defendants’ repeated
correspondence into Alabama suffices as overt acts taken within the forum.
Therefore, personal jurisdiction is proper over Utica under the conspiracy theory.
9

See e.g. Doc. 14 (“Both IAC and Maynards communicated with Plaintiff by telephone about the
auction as it was taking place; advertised the auction in Alabama; provided the auction brochure
in Alabama; directed telephone calls, emails and letters regarding the auction and goods to
Plaintiff in Alabama.”).
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iii. Minimum Contacts
Plaintiff avers that “notwithstanding the fact that this Court has personal
jurisdiction over Utica by virtue of its personal jurisdiction over Utica’s agents . . .
jurisdictional discovery may reveal that Utica independently has sufficient
minimum contacts with Alabama.” (See Doc. 14 at 8.) Arguing that “Utica
directed its fraudulent and unlawful shill bidding towards Alabama.” (Id.) Indeed,
the record shows that Utica admitted to having bid against Transamerican in the
Auction. (See Doc. 1 at 3) (“Utica then bid . . . .”)). Utica claims that although it
“has registered to do business in Alabama and has appointed an agent for service of
process, [it] is not currently conducting business in Alabama[;]” and “[i]n its
history, Utica has participated in one business transaction in Alabama.” (Doc. 2 at
2) (The lone transaction is purportedly “unrelated to Plaintiff’s claims” and
“began in 2013 and concluded in 2015.”). Plaintiff attached to its Response in
opposition to Utica’s Motion to Dismiss, UCC records which appear to indicate
that Utica engaged in at least twelve commercial transactions in the state of
Alabama between 2013 and 2015. (Doc. 14-3 at 2-3.) In its reply brief (doc. 18),
Utica wholly failed to respond to Plaintiff’s allegations regarding its contacts with
Alabama as evidenced by the UCC report. Even if the Court had found that no
personal jurisdiction existed on the basis of either the agency theory or the
Page 15 of 21

conspiracy theory, the Court finds that it would be inappropriate to grant the
12(b)(2) motion at this stage in the litigation for lack of minimum contacts. The
twelve transactions as evidenced by the UCC report, considered in conjunction
with its registration to do business in Alabama, as well as its having an agent for
service of process, would prove to be sufficient contacts in order to confer
jurisdiction over Utica. Because there is a conflict, it is incumbent upon the court
“to construe all reasonable inferences in favor of the plaintiff.” Madara, 916 F.2d
at 1514 (internal citation omitted). As such, Utica’s 12(b)(2) motion to dismiss is
due to be DENIED.
IV.

IAC & MAYNARDS’ MOTION TO CHANGE VENUE (DOC. 3)
“For the federal court system, Congress has codified the doctrine and has

provided for transfer, rather than dismissal, when a sister federal court is the more
convenient place for trial of the action.” Sinochem Intern. Co. Ltd. v. Malaysia
Intern. Shipping Corp., 549 U.S. 422, 430 (2007) (citing 28 U.S.C. § 1404(a) 10
(“For the convenience of parties and witnesses, in the interest of justice, 11 a district

10

cf. § 1406(a) (“The district court of a district in which is filed a case laying venue in the wrong
division or district shall dismiss, or if it be in the interest of justice, transfer such case to any
district or division in which it could have been brought.”)
11
The relevant factors to consider under a 1404(a) transfer include: “(1) the convenience of the
witnesses; (2) the location of relevant documents and the relative ease of access to sources of
proof; (3) the convenience of the parties; (4) the locus of operative facts; (5) the availability of
process to compel the attendance of unwilling witnesses; (6) the relative means of the parties; (7)
a forum’s familiarity with the governing law; (8) the weight accorded a plaintiff’s choice of
Page 16 of 21

court may transfer any civil action to any other district or division where it might
have been brought.”)). Because “the federal courts traditionally have accorded a
plaintiff's choice of forum considerable deference,” it is incumbent upon the
“movant to establish that the suggested forum is more convenient.” In re Ricoh
Corp., 870 F.2d 570, 573 (11th Cir. 1989). Indeed, “[t]he plaintiff's choice of forum
should not be disturbed unless it is clearly outweighed by other considerations.”
Robinson v. Giarmarco & Bill, P.C., 74 F.3d 253, 260 (11th Cir. 1996) (citation
omitted). In this Circuit, “[t]he decision to transfer a case to another district is
within the sound discretion of the trial court.” Brown v. Conn. Gen. Life Ins. Co.,
934 F.2d 1193, 1197 (11th Cir. 1991) (citation omitted). When exercising its
discretion, the court should undertake an “individualized, case-by-case
consideration of convenience and fairness.” Stewart Org., Inc. v. Ricoh Corp., 487
U.S. 22, 29 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622 (1964)).
Defendants claim that transfer is in the interest of justice because: (1)
‘material’ witnesses will be unable to attend trial in Tuscaloosa, (2) inspections and
viewings of the equipment, if needed, can only occur in North Carolina, (3) a
district court in North Carolina will have greater familiarity with evaluating claims

forum; and (9) trial efficiency and the interests of justice, based on the totality of the
circumstances.” Manuel v. Convergys Corp., 430 F.3d 1132, 1135 n. 1 (11th Cir. 2005) (citing Gibbs
& Hill, Inc. v. Harbert Int'l, Inc., 745 F. Supp. 993, 996 (S.D.N.Y.1990)).
Page 17 of 21

under North Carolina statutes, and (4) for the sole reason to avoid the ‘difficult
jurisdictional question’ with respect to one defendant, Utica.
In their motion and reply, Defendants fail to provide sufficient proof that
their witnesses are materially relevant enough to warrant considerations of
convenience. They assert that three witnesses would be unavailable to attend trial
in Tuscaloosa. 12 In addition, they assert that they have, “knowledge related to
Plaintiff, other potential bidders at the auction, potential post-auction buyers of the
Equipment, Plaintiff’s inspections of the Equipment and the building housing the
equipment, and details of an occupancy agreement Plaintiff entered after the
auction.” (Doc. 3 at 5.) The Court finds this insufficient to support an assertion
that North Carolina is a more convenient forum. Because Plaintiff’s claims mainly
pertain to the actual bidding process, the potential observance of the possible
removal of the equipment is irrelevant. In contrast, Plaintiff has provided specific
witnesses who were personally involved in the auction bidding. Because they
possess personal knowledge of the events at issue (those surrounding the Auction),
Plaintiff’s witnesses, Michael Freidman, Luther S. Pate and Alan Davis, are

12

Defendants provided affidavits from Wayne Merrit (See Doc. 3 at 12-13) and Jeff Davis (See
Doc. 3 at 16-18), whom are representatives of Low & Bonar, the owner of the building where the
Equipment sold at the Auction is housed. Additionally, they attached the affidavit of William
Newman (See Doc. 3 at 20-21), who “had contact with Plaintiff’s representative Stanley Pate
regarding related [sic] to Plaintiff’s removal of the equipment from its current location, [and] is
also unavailable for a trial in Tuscaloosa.” (Doc. 3 at 5-6.)
Page 18 of 21

considered more materially relevant and their inability to travel to North Carolina
is afforded more weight. (See Doc. 15-1.)
It is difficult to see any necessity or purpose in viewing or inspecting the
equipment sold in the Auction—a reason Defendants assert to support their
motion.13 Not only are there no claims in the Complaint pertinent to the equipment
which would necessitate inspection, Defendants provide no reason why a possible
inspection would occur, but merely claim that if any inspections were to take place,
they would be done in North Carolina, which would weigh in favor of a transfer.
(See Doc. 3 at 6.) If the equipment were a source of proof applicable to the claims in
the Complaint, this would be a relevant factor to evaluate. As it stands, the
possibility of needing inspections of the property is slim, and thus of no
consequence in determining whether the transfer should be made.
Third, it goes without saying that a North Carolina district court would have
greater familiarity with North Carolina state statutes. However, “in cases such as
the present, where the defendants seek transfer, the transferee district court must
be obligated to apply the state law that would have been applied if there had been
no change of venue. A change of venue under § 1404(a) generally should be, with
respect to state law, but a change of courtrooms.” Van Dusen, 376 U.S. at 639. The
13

As such, the situs of the subject equipment is not a consideration weighing in favor of transfer
because Plaintiff’s claims stem from the Auction bidding process itself.
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Supreme Court “deemed that exception necessary to prevent ‘defendants,
properly subjected to suit in the transferor State,’ from ‘invok[ing] § 1404(a) to
gain the benefits of the laws of another jurisdiction . . . .’” Atl. Marine Constr. Co.
v. U.S. D. Ct. W.D. Tex., 134 S. Ct. 568, 579 (2013) (citations omitted). A transfer
would require the transferee forum to evaluate the state law claims of fraudulent
suppression, fraud and fraudulent inducement, as well as the conspiracy and breach
of contract claims, under Alabama law. This Court is better suited to evaluate those
five state law claims than a North Carolina court. Additionally, the fact that the
state law claims requiring an analysis under Alabama law are more numerous than
the two claims brought under North Carolina statutes weighs against transfer.
Finally, Defendants fail to support their strong assertion that the case should
be transferred for the sole reason of avoiding the jurisdictional question with
respect to Utica. Defendants neglected to cite any binding authority to the 11th
Circuit or the forum court. A plaintiff who has filed for additional discovery
requests or otherwise diligently pursued jurisdictional discovery opportunities is
entitled to the occasion to discover facts that would support her allegations of
jurisdiction. See Am. Civil Liberties Union of Fla., Inc., 859 F.3d 1337 at 1341.

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Because the Court has determined that it possesses personal jurisdiction over
Utica, an argument for transfer on this ground fails. See Section III, supra. 14
In sum, the Court finds that a transfer “would merely shift inconvenience
from the defendants to the plaintiff . . . .” Robinson, 74 F.3d at 260. As such,
Defendants motion to transfer is due to be DENIED.
V.

CONCLUSION
For the reasons discussed above, Transamerican’s Motion to Remand (doc.

11) is due to be DENIED, and its Motion for Discovery (doc. 12) due to be
terminated as MOOT; Utica’s Motion to Dismiss (doc. 2) is due to be DENIED
and IAC & Maynards’ Motion to Change Venue (doc. 3) is also due to be
DENIED. An Order consistent with this Opinion will be entered herewith.
DONE and ORDERED on February 12, 2018.

_____________________________
L. Scott Coogler
United States District Judge
190685

14

It their Reply, Defendants cite First Federal Sav. and Loan Ass’n v. Berger, 672 F. Supp. 1454,
1457 (M.D. Ga. 1987) for the proposition that the case should transferred because it would be
“preferable to a jurisdictional battle in the plaintiff’s chosen forum.” (Doc. 17 at 2.) Not only is
the case non-binding, it is distinguishable. In Berger, at least two other actions which would affect
the outcome of the Berger case were pending in New Orleans, Louisiana. When considered with
other factors, that fact enabled defendants to sustain the burden of showing that a transfer from
Georgia to Louisiana was proper. Defendants have made no such showing here (regarding other
cases pending in North Carolina), therefore this case is unhelpful to them.
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