Dalton v. Atchison et al

Filing 16

ORDER granting 7 Defendant's Motion to Dismiss Plaintiff's Complaint on Improper Venue Grounds and to Transfer Venue. This case is being transferred to the United States District Court for the Eastern District of Arkansas. Signed by Magistrate Judge John Z Boyle on 6/23/16.(LSP)

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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Harry D Dalton, Plaintiff, 10 11 ORDER v. 12 No. CV-16-08014-PCT-JZB Wade Atchison, et al., 13 Defendants. 14 15 Pending before the Court is Defendant’s Motion to Dismiss Plaintiff’s Complaint 16 on Improper Venue Grounds or, in the Alternative, to Transfer Venue pursuant to 28 17 U.S.C. § 1406(a). (Doc. 7.) Defendant requests the Court dismiss this matter because 18 venue is not proper in the United States District Court for the District of Arizona pursuant 19 to 28 U.S.C. § 1391(b). Alternatively, Defendant requests the Court transfer this case to 20 the United States District Court for the Eastern District of Arkansas. As detailed below, 21 none of the requirements of § 1391(b) are met here and, therefore, venue is not proper in 22 this Court. In the interests of justice, the Court will transfer this case to the United States 23 District Court for the Eastern District of Arkansas, where the case could have been 24 brought. 25 I. Background 26 On December 21, 2015, Plaintiff, proceeding pro se, filed his Complaint in 27 Arizona state court, asserting claims against Defendant for breach of contract and 28 intentional infliction of emotional distress. (Doc. 1-1 at 4-12.) Specifically, Plaintiff 1 asserts that Defendant breached the parties’ insurance contract when Defendant, an agent 2 of Allstate, failed to notify Plaintiff of the possible risks in changing Plaintiff’s “Builder’s 3 Risk Policy” to a home owner’s policy, and subsequently allowed Plaintiff’s policy to 4 lapse. (Id. ¶¶ 12, 15-16, 22, 25.) Plaintiff asserts that he obtained the Builder’s Risk 5 Policy to insure a construction project at his property located in Dover, Arkansas. (Id. ¶ 6 21.) According to Plaintiff, on May 24, 2013, Plaintiff suffered a neck injury on the 7 property while operating a piece of heavy equipment, and was transported to a hospital in 8 Littlerock, Arkansas. 9 electrical wire was stolen from the construction site. (Id. ¶ 25.) (Id. ¶ 24.) During Plaintiff’s three-day stay at the hospital, Plaintiff claims that 10 Allstate adjusters denied Plaintiff’s claim for theft. Plaintiff asserts Defendant offered to 11 personally pay half of the cost to replace the wire, but never paid Plaintiff that amount. 12 (Id.) Plaintiff further asserts that Defendant failed to assist Plaintiff in reporting the theft 13 to the police. (Id.) On December 18, 2013, Plaintiff, on a recommendation by his doctor 14 in Arkansas, underwent surgery in Los Angeles, California for his injury. (Id. ¶¶ 25-26.) 15 On January 27, 2016, Defendant removed the action to this Court based on 16 diversity jurisdiction.1 (Doc. 1.) On February 4, 2016, Defendant filed his Motion to 17 Dismiss on Improper Venue Grounds or, in the Alternative, Motion to Change Venue to 18 the Eastern District of Arkansas, pursuant to 28 U.S.C. §1406(a). (Doc. 7.) Plaintiff 19 opposes the Motion and asserts that, due to his medical condition and financial status, and 20 his domicile in Arizona, venue is proper in the United State District Court for the District 21 of Arizona. (Doc. 13 at 2.) Below, the Court addresses the parties’ arguments. 22 II. Discussion 23 a. Legal Standards 24 25 26 27 28 1 The parties do not dispute that the Court has diversity jurisdiction over this matter. 28 U.S.C. § 1332 (“The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $ 75,000, exclusive of interest and costs, and is between . . . [c]itizens of different States.”). In his Complaint, Plaintiff asserts that he resides in Arizona and Defendant resides in Arkansas. (Doc. 1-1 at 4, ¶¶ 1-2.) Plaintiff further seeks over $75,000 in damages. (Id. at 11-12.) Defendant asserts in his Notice of Removal that all of the requirements of diversity jurisdiction have been met. (Doc. 1 at 1-2.) -2- 1 A defendant may challenge venue pursuant to Rule 12(b)(3) of the Federal Rules 2 of Civil Procedure and 28 U.S.C. § 1391. If venue is improper, the Court must either 3 dismiss the case or, “if it be in the interest of justice, transfer [the] case to any district or 4 division in which it could have been brought.” See 28 U.S.C. § 1406(a). The decision 5 whether to dismiss the case or transfer it is within the Court’s discretion. In re Hall, 6 Bayoutree Associates, Ltd., 939 F.2d 802, 804 (9th Cir. 1991). However, “the general 7 preference . . . is for the case to be transferred instead of dismissed altogether.” 8 Kewlmetal Inc. v. Bike Builders Bible, Inc., 2:15-cv-01008 JWS, 2015 U.S. Dist. LEXIS 9 168362, at *2 (D. Ariz. Dec. 15, 2015) (citing See Brodt v. Cty. of Harford, 10 F. Supp. 10 3d 198, 203 (D.D.C. 2014), and Abrams Shell v. Shell Oil Co., 165 F. Supp. 2d 1096, 11 1103 (C.D. Cal. 2001)). 12 b. Venue in the District of Arizona is improper. 13 Defendant argues that the Court should dismiss this case because venue in the 14 District of Arizona is not proper pursuant to 28 U.S.C. § 1391(b). Section 1391(b) 15 provides the following: 16 17 18 19 20 21 22 (b) Venue in general. A civil action may be brought in— (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; (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) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court’s personal jurisdiction with respect to such action. 23 “The venue statutes are generally intended to protect a defendant from being forced to 24 defend in an unfair or inconvenient forum.” Shell v. Shell Oil Co., 165 F. Supp. 2d 1096, 25 1106 (C.D. Cal. 2001). The “[p]laintiff has the burden of proving that venue is proper in 26 the district in which the suit was initiated.” Hope v. Otis Elevator Co., 389 F. Supp. 2d 27 1235, 1243 (E.D. Cal. 2005) (citing Airola v. King, 505 F. Supp. 30, 31 (D. Ariz. 1980)). 28 When deciding a challenge to venue, the pleadings need not be accepted as true, and the -3- 1 district court may consider facts outside of the pleadings. Arguenta v. Banco Mexicano, 2 S.A., 87 F.3d 320, 324 (9th Cir. 1996). 3 Here, the Court finds that venue is not proper in this Court pursuant to 28 U.S.C. 4 § 1391(b). First, venue is improper under § 1391(b)(1) because Defendant resides in 5 Arkansas. (Doc. 1-1 at 4, ¶¶ 1-2; Doc. 7-1 ¶¶ 2-3.) Second, venue is improper under § 6 1391(b)(2) because, as the parties agree, the events giving rise to Plaintiff’s claims took 7 place in Arkansas, not Arizona. (Doc. 1-1 ¶¶ 21, 24; Doc. 7 at 4.) 8 Finally, § 1391(b)(3) does not apply because this case could have been brought in 9 the Eastern District of Arkansas. Defendant resides in the Eastern District of Arkansas, 10 and a substantial part of the alleged events giving rise to Plaintiff’s claims occurred in 11 that District. (Doc. 1-1 at 4, ¶¶ 1-2; Doc. 7-1 ¶ 2.) Further, based on Plaintiff’s 12 Complaint and the parties’ briefing, it appears the United States District Court for the 13 District of Arkansas would have subject matter jurisdiction over this case and personal 14 jurisdiction over both parties. (Id.) Importantly, Plaintiff does not contest that this action 15 could have been brought in that District Court. 16 Instead, Plaintiff requests that this case proceed in the District of Arizona because 17 his medical condition, which resulted from the accident in Arkansas, hinders his ability to 18 travel and prosecute his claims in Arkansas. (Doc. 13 at 2.) However, Plaintiff does not 19 assert any argument that this case meets any of the requirements of § 1391(b).2 20 Because none of the provisions of § 1391(b) are met in this case, venue is not 21 proper in the District of Arizona. Therefore, the Court must now determine whether to 22 23 24 25 26 27 28 2 In a Sur-Reply, Plaintiff also asserts that “[o]riginally this suit was filed in Mojave County Court, but the defense lawyer moved the case to the U.S. Federal Court, District of Arizona. Why did the defense lawyer move the case if she did not intend for it to be heard in that court?” (Doc. 15 at 2.) First, Plaintiff did not seek leave to file his Sur-Reply in violation of the Local Rules of Civil Procedure. See LRCiv. 7.2. Second, even considering Plaintiff’s Sur-Reply, Defendant’s removal did not waive his right to challenge venue in Arizona. See Crumrine v. NEG Micon USA, Inc., 104 F. Supp. 2d 1123, 1128 (N.D. Iowa 2000) (holding that when a “defendant removes an action from a state court in which he has been sued, he consents to nothing and ‘waives’ nothing; he is exercising a privilege unconditionally conferred by statute, and, since the district court to which he must remove it is fixed by law, he has no choice.”) (quoting Greenberg v. Giannini, 140 F.2d 550, 553 (2d Cir. 1944)). -4- 1 dismiss this case or transfer it to the Eastern District of Arkansas. 2 c. Transferring this case to the Eastern District of Arkansas is appropriate. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Pursuant to 28 U.S.C. § 1406(a), “[t]he 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.” See Goldlawr, Inc. v. Heiman, 369 U.S. 463, 466 (1962) (holding that “[t]he language of § 1406(a) is amply broad enough to authorize the transfer of cases, however wrong the plaintiff may have been in filing his case as to venue, whether the court in which it was filed had personal jurisdiction over the defendants or not.”). As stated above, Plaintiff’s claim could have been brought in the Eastern District of Arkansas. Defendant resides in the Eastern District of Arkansas. (Doc. 7-1 ¶¶ 2-3.) Further, a substantial part of the alleged events giving rise to this litigation occurred in the Eastern District of Arkansas: the insurance contract was negotiated in Dover, Arkansas3 (Doc. 1-1 at 8, ¶ 21); Plaintiff was on property located in Arkansas when his injury occurred, and the theft occurred on the same property (id. at 8-9, ¶¶ 21-25); and all of the relevant communications and transactions between the two parties occurred in Arkansas (id. at 6-7, ¶¶ 12, 14-16). Transferring this case to a new venue would serve the interests of justice because it would allow Plaintiff to continue the litigation in the correct forum. Plaintiff asserts that the District of Arizona is the correct venue due to his health problems, as well as the need to be close to his doctor. (Doc. 13 at 2.) However, Plaintiff fails to identify a court other than the District Court for the Eastern District of Arkansas where this case could have been brought. And, although Plaintiff states that “[a]ll . . . witnesses can have depositions taken in place of them appearing in person in Arizona,” (Doc. 13 at 2), the Court assumes that Plaintiff would be able to telephonically depose 3 Dover is an incorporated city situated in Pope County, Arkansas. POPE COUNTY ARK., http://www.popecounty ar.com/index.html (last visited June 16, 2016). Under 28 U.S.C. § 83(a)(2), Pope County resides in the Eastern Division of the Eastern District of Arkansas. -5- 1 Defendant and other witnesses who reside in Arkansas. 2 Additionally, it appears that Plaintiff’s claims may be time-barred if dismissed. 3 See Ark. Code. Ann. § 16-56-105 (2015);4 McQuay v. Guntharp, 331 Ark. 466, 474-76 4 (1998) (holding that the tort of outrage is governed by a three-year statute of limitations). 5 Plaintiff filed his Complaint on December 21, 2015, alleging at least some unlawful 6 conduct that occurred in May 2013. (Doc. 1-1 ¶ 21.) Therefore, the Court favors 7 transferring, rather than dismissing, this case in the interests of justice. See Westphal v. 8 Mace, 671 F. Supp. 665, 668 (D. Ariz. 1987) (holding that transferring the case from 9 Arizona to Nevada would be in the interests of justice when the injury to Plaintiff 10 occurred in Nevada and the only connection Defendant had to Arizona was advertising in 11 Arizona); Mach 1 Air Servs. Inc.v. Bustillos, No. CV-12-02617-PHX-GMS, 2013 U.S. 12 Dist. Lexis 41501, *31-32 (D. Ariz. March 25, 2013) (ruling that “the interests of justice 13 warrant transfer of the entire case to the Western District of Texas” because “[t]hat court 14 would have jurisdiction over all the [p]arties. . . . [and the plaintiff] would likely be 15 severely prejudiced by dismissal.”). Accordingly, the Court will transfer the case to the 16 Eastern District of Arkansas. 17 III. Conclusion 18 Although Plaintiff claims Arizona is an easier and more financially feasible venue 19 to adjudicate his case, venue in this Court is improper pursuant to 28 U.S.C. § 1391(b). 20 Rather than dismissing the case, in the interests of justice, the Court will transfer this 21 action to the Eastern District of Arkansas. 22 Accordingly, 23 IT IS ORDERED that Defendant’s Motion to Dismiss Plaintiff’s Complaint on 24 4 25 26 27 28 Ark. Code Ann. § 16-56-105 provides, in relevant part: The following actions shall be commenced within three (3) years after the cause of action accrues: (1) All actions founded upon any contract, obligation, or liability not under seal and not in writing, excepting such as are brought upon the judgment or decree of some court of record of the United States or of this or some other state -6- 1 Improper Venue Grounds or, in the Alternative, to Transfer Venue (Doc. 7) is granted as 2 provided in this Order. 3 4 5 IT IS FURTHER ORDERED that this case be transferred to the United States District Court for the Eastern District of Arkansas. Dated this 23rd day of June, 2016. 6 7 Honorable John Z. Boyle United States Magistrate Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -7-

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