Smith v. Aetna Life Insurance Company

Filing 22

ORDER GRANTING DEFENDANT'S MOTION TO TRANSFER VENUE TO MIDDLE DISTRICT OF NORTH CAROLINA (SI, COURT STAFF) (Filed on 9/6/2011)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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TAMMY SMITH,

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United States District Court
For the Northern District of California

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No. C 11-2559 SI

Plaintiff,

ORDER GRANTING DEFENDANT’S
MOTION TO TRANSFER VENUE TO
MIDDLE DISTRICT OF NORTH
CAROLINA

v.
AETNA LIFE INSURANCE COMPANY,

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Defendant.

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Defendant’s motion to transfer venue is scheduled for a hearing on September 9, 2011. Pursuant

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to Civil Local Rule 7-1(b), the Court determines that the matter is appropriate for resolution without oral

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argument, and VACATES the hearing. For the reasons set forth below, the Court GRANTS defendant’s

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motion and TRANSFERS this action to the United States District Court for the Middle District of North

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Carolina.

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BACKGROUND

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On May 26, 2011, plaintiff Tammy Smith filed this action alleging that defendant Aetna Life

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Insurance Company violated the Employee Retirement Income Security Act of 1974 (“ERISA”), as

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amended, 29 U.S.C. § 1001 et seq., by denying plaintiff’s application for long term disability (“LTD”)

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benefits. Compl. ¶ 5.

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Plaintiff resides in High Point, North Carolina, and was employed by Bank of America in

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Greensboro, North Carolina for nine years. Id. ¶ 3, 5, 6. Plaintiff filed a claim for LTD benefits from

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defendant Aetna, the plan administrator for Bank of America, and was denied benefits while she resided

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in North Carolina. See id. ¶¶ 3, 5. Aetna is a Connecticut corporation with its principal place of

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business in Hartford, Connecticut. Id. ¶ 4. The LTD plan at issue was not administered in the Northern

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District of California. Devlin Decl. ¶ 6.

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LEGAL STANDARD
“For the convenience of parties and witnesses, in the interest of justice, a district court may

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transfer any civil action to any other district or division where it might have been brought.” 28 U.S.C.

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§ 1404(a). The purpose of § 1404(a) is to “prevent the waste of time, energy and money and to protect

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litigants, witnesses and the public against unnecessary inconvenience and expense.” Van Dusen v.

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Barrack, 376 U.S. 612, 616 (1964) (internal citations and quotation omitted). If the forum is found to

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United States District Court
For the Northern District of California

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be inconvenient under 28 U.S.C. § 1404(a), the remedy is transfer, not dismissal. See Collins v.

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American Automobile Insurance Company, 230 F.2d 416, 418 (2d Cir. 1956).

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A motion for transfer lies within the broad discretion of the district court, and must be

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determined on an individualized basis. See Jones v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir.

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2000). To support a motion for transfer, the moving party must establish: (1) that venue is proper in the

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transferor district; (2) that the transferee district is one where the action might have been brought; and

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(3) that the transfer will serve the convenience of the parties and witnesses, and will promote the

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interests of justice. See Goodyear Tire & Rubber Co. v. McDonnell Douglas Corp., 820 F. Supp. 503,

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506 (C.D. Cal. 1992). Transfer is discretionary, but is governed by certain factors specified in § 1404(a)

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and in relevant case law.

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DISCUSSION

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Defendant moves to dismiss or transfer this case pursuant to 28 U.S.C. § 1404(a) on the ground

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that plaintiff does not reside in or have any contacts, other than the location of her counsel, with the

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Northern District of California. Defendant argues that should discovery and trial testimony be necessary

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in this case, the Middle District of North Carolina is a more convenient forum than California because

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plaintiff’s residence, former employer, and plaintiff’s medical providers are all located in North

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Carolina. Plaintiff asserts this district is the more convenient forum due to the location of her counsel,

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and she argues that this case will almost certainly be decided upon the administrative record and
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therefore that no discovery or trial testimony will be required..

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As an initial matter, the Court finds that venue would be proper in either this district or the

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Middle District of North Carolina. ERISA provides that venue is proper in “the district where the plan

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is administered, where the breach took place, or where a defendant resides or may be found.” 29 U.S.C.

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§ 1132(e)(2). There is no dispute that defendant may be found in both districts.
Once venue is determined to be proper in both districts, the Court evaluates the following factors

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to determine which venue is more convenient to the parties and the witnesses: (1) plaintiff’s choice of

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forum, (2) convenience of the parties, (3) convenience of the witnesses, (4) ease of access to the

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evidence, (5) familiarity of each forum with the applicable law, (6) feasibility of consolidation with

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United States District Court
For the Northern District of California

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other claims, (7) any local interest in the controversy, and (8) the relative court congestion and time of

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trial in each forum. See Jones v. GNC Franchising Inc., 211 F.3d at 498-499.

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The Court finds that on balance, these factor favor transfer. Where a plaintiff does not reside

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in the forum, the Court may afford his choice considerably less weight. See Schwarzer et. al., Federal

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Civil Procedure Before Trial § 4:761 (2011). Here, plaintiff Smith is currently a resident of North

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Carolina, and she was a resident of North Carolina for all periods of time relevant to this case.

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Defendant’s alleged breach of ERISA stems from plaintiff’s application for LTD benefits, which was

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filed in North Carolina.

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The only connection plaintiff has to this district is the presence of her counsel. Plaintiff contends

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that there are a “limited number of attorneys in the country who handle ERISA disability benefits cases”

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and filing in this district is the most economically viable option. Pl.’s Opp’n 2:7-16. While the Court

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is sympathetic to these concerns, it is nevertheless undisputed that none of the events giving rise to

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plaintiff’s ERISA claim occurred in California. Section 1404(a) refers to “parties” and not counsel. See

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28 U.S.C § 1404(a). The convenience of counsel is not considered for purposes of deciding whether

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a venue is convenient for the purposes of § 1404(a). See In re. Horseshoe Entertainment, 337 F.3d 429,

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434 (5th Cir. 2003) (“The factor of ‘location of counsel’ is irrelevant and improper for consideration in

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determining the question o f the transfer of venue.”); Solomon v. Continental American, 472 F.2d 1043,

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1047 (3d Cir. 1974) (“The convenience of counsel is not a factor to be considered.”).

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Plaintiff relies on Abercrombie v. Continential Casualty Company to support her argument that
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her lack of contacts with this district does not warrant transfer. In that case, the court stated “even if

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[plaintiff] has no contacts with South Carolina, the exercise of personal jurisdiction over [defendant]

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is proper.” 295 F. Supp. 2d 604, 607 (D.S.C. 2003). There, unlike here, the defendant moved to transfer

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pursuant to § 502(e)(2) of ERISA. The court expressly limited its discussion to the consideration of

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improper venue under § 502(e)(2), and the court noted that defendant “[did] not move to transfer venue

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pursuant to 28 U.S.C. § 1404(a) for the convenience of the parties and witnesses.” Abercrombie v.

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Continental Casualty Co., 295 F. Supp. 2d at 607 n. 2. Here, in contrast, defendant Aetna moves to

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transfer for the convenience of the parties under § 1404(a), and thus Abercrombie is inapposite.1
The Court further finds that North Carolina is more convenient for the parties and witnesses, and

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United States District Court
For the Northern District of California

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provides greater ease of access to evidence. Plaintiff contends that this district is equally convenient

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because this case will be heard on the administrative record without testimony or depositions. Plaintiff

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alternatively argues that if discovery is needed, it will be limited to interrogatories and directed to

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defendant’s home office in Connecticut, not North Carolina. Plaintiff also argues that this district would

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be convenient because, per local rules, parties can appear for ADR by telephone with court approval.

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Defendant, in contrast, asserts that oral discovery and trial testimony may be necessary, and thus that

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North Carolina is the more convenient forum. Defendant also asserts that litigants need to personally

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attend mandatory ADR and may want to attend court hearings.

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For the purposes of resolving the instant motion, the Court need not decide whether plaintiff’s

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claims against defendant will be adjudicated purely on the administrative record, whether discovery and

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trial testimony will be necessary, or whether ADR requires the physical presence of the litigants.

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Defendants have submitted evidence that plaintiff, her former employer, and the medical providers who

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evaluated her conditions are all located in North Carolina. Plaintiff does not dispute that her only

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connection to this district is the location of her counsel. Even if discovery is directed to defendant’s

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home office in Connecticut, North Carolina is closer to Connecticut and thus is a more convenient venue

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than this district.

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Plaintiff’s reliance on Cyr v. Reliance Standard Life Insurance Company, 642 F.3d 1202 (9th
Cir. 2011), is also misplaced. In Cyr, the Ninth Circuit addressed the issue of who is a proper defendant
in an ERISA case, and the court did not examine venue under § 1404(a).
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The remaining factors are largely neutral in the transfer analysis. Where federal law governs

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all claims raised, as here, “either forum is equally capable of hearing and deciding those questions.”

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Dealtime.com Ltd. v. McNulty, 123 F. Supp. 2d 750, 757 (S.D.N.Y. 2000). Finally, North Carolina

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arguably has a greater interest in the controversy due to the plaintiff’s residence and alleged denial of

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benefits in that state.

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CONCLUSION

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For the foregoing reasons and good cause shown, the Court hereby GRANTS defendant’s motion

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to transfer venue, and TRANSFERS this action to the United States District Court for the Middle

United States District Court
For the Northern District of California

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District of North Carolina. (Docket Nos. 15, 20, 21)

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IT IS SO ORDERED.

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Dated: September 6, 2011
SUSAN ILLSTON
United States District Judge

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