American Home Assurance Company v. Tutor-Saliba Corporation/O&G Industries, Inc. JV. et al

Filing 74

ORDER by Judge Samuel Conti denying 47 Motion to Dismiss and granting R&L Brosamer's alternative motion to transfer venue to the Central District of California. The Court DIRECTS the Clerk to transfer this case to the Central District of California. All pending motion hearing dates are hereby VACATED. (sclc1, COURT STAFF) (Filed on 5/12/2015)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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United States District Court

For the Northern District of California

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AMERICAN HOME ASSURANCE
COMPANY,

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Plaintiff,

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v.

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TUTOR-SALIBA CORPORATION/O&G
INDUSTRIES, INC. JV; TUTORSALIBA CORPORATION; O&G
INDUSTRIES, INC.; and R&L
BROSAMER, INC.,
Defendants.

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Case No. 15-00303 SC
ORDER DENYING MOTION TO
DISMISS AND TRANSFERRING CASE
TO THE CENTRAL DISTRICT OF
CALIFORNIA

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I.

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INTRODUCTION
This is a dispute regarding insurance coverage for the

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allegedly defective construction of an airport runway in Los

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Angeles.

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here, and no party is a citizen of this district.

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Court is Defendant R&L Brosamer, Inc.'s ("Brosamer") motion to

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dismiss for improper venue or, in the alternative, to transfer

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venue to the Central District of California.

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None of the events giving rise to this lawsuit occurred
Now before the

The motions are fully

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briefed, 1 and the Court finds them suitable for disposition without

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oral argument pursuant to Civil Local Rule 7-1(b).

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set forth below, Brosamer's motion to dismiss is DENIED, but

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Brosamer's alternative motion to transfer venue is GRANTED, and the

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Court ORDERS that this action be transferred to the Central

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District of California.

For the reasons

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II.

BACKGROUND
In 2003, the City of Los Angeles (the "City") decided to

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United States District Court

For the Northern District of California

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demolish, relocate, and rebuild a runway at Los Angeles World

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Airport.

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Tutor-Saliba Corporation/O&G Industries, Inc. JV 2 (the "Joint

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Venture") to demolish the old runway and build the new one.

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21.

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concrete and labor.

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Id. ¶ 19.

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Court alleging that the Joint Venture and Brosamer's construction

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work was defective.

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issued insurance policies to the City, and Tutor and Brosamer may

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qualify as insureds under those policies.

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Brosamer tendered the claims in the underlying action to American

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Home, which is providing them with defenses in that action under a

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full reservation of rights.

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brought this lawsuit, seeking a declaration that it does not owe

Compl. ¶¶ 15-16.

The City contracted with Defendant

The Joint Venture subcontracted with Defendant Brosamer for
Id. ¶ 25.

Construction was complete by 2008.

In 2013, the City filed a lawsuit in California Superior

Id. ¶¶ 20, 28-31.

Id. ¶¶ 7-8.

Plaintiff American Home

Id. ¶ 6.

Tutor and

American Home then

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Id. ¶

ECF Nos. 47 ("Mot."), 55 ("Opp'n"), 58 ("Reply").

Tutor-Saliba Corporation/O&G Industries, Inc. JV is a joint
venture between Defendants Tutor-Saliba Corporation and O&G
Industries, Inc. Compl. ¶ 10.

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any defendant a duty to defend the underlying action.

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Id. ¶¶ 47-

50.

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III. LEGAL STANDARD
Venue is proper in (1) a judicial district in which any

which that district is located; or (2) a judicial district in which

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a substantial part of the events giving rise to the claim occurred.

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28 U.S.C. § 1391(b).

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United States District Court

defendant resides, if all defendants are residents of the state in

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For the Northern District of California

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in any judicial district in which any defendant is subject to the

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court's personal jurisdiction with respect to the action.

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venue purposes, a defendant entity is a resident of any judicial

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district in which the defendant is subject to the court's personal

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jurisdiction with respect to the action in question.

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§ 1391(c).

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If no such district exists, venue is proper

Id.

For

Id.

Federal Rule of Civil Procedure 12(b)(3) allows a defendant to

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move to dismiss an action for improper venue.

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motion, "the pleadings need not be accepted as true, and the court

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may consider facts outside of the pleadings," but the court must

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draw all reasonable inferences and resolve all factual conflicts in

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favor of the non-moving party.

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362 F.3d 1133, 1137 (9th Cir. 2004).

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wrong district, the court may dismiss it, or, if it is in the

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interest of justice, transfer it to any proper district.

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U.S.C. § 1406(a).

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On a Rule 12(b)(3)

Murphy v. Schneider Nat'l, Inc.,
When a case is filed in the

See 28

Even if venue is proper where an action is filed, the Court

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may "[f]or the convenience of parties and witnesses, in the

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interests of justice . . . transfer any civil action to any other

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§ 1404(a).

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case consideration of convenience and fairness."

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Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000).

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a motion for transfer the moving party must show: (1) that venue is

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proper in the transferor district; (2) that the transferee district

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is one where the action might have been brought; and (3) that the

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transfer will serve the convenience of the parties and witnesses

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and will promote the interest of justice."

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United States District Court

District . . . where it might have been brought."

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For the Northern District of California

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Co. v. McDonnell Douglas Corp., 820 F. Supp. 503, 506 (C.D. Cal.

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1992).

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the third element is satisfied, including:
(1) the location where the relevant agreements were
negotiated and executed, (2) the state that is most
familiar with the governing law, (3) the plaintiff's
choice of forum, (4) the respective parties' contacts
with the forum, (5) the contacts relating to the
plaintiff's cause of action in the chosen forum, (6) the
differences in the costs of litigation in the two forums,
(7) the availability of compulsory process to compel
attendance of unwilling non-party witnesses, and (8) the
ease of access to sources of proof.

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GNC Franchising, 211 F.3d at 498.

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has recognized "a local interest in having localized controversies

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decided at home."

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(1981).

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Los Angeles area . . . , the Central District has a much more

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substantial interest in seeing a resolution of th[e] litigation."

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Fabus Corp. v. Asiana Exp. Corp., No. C-00-3172 PJH, 2001 WL

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253185, at *2 (N.D. Cal. Mar. 5, 2001).

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28 U.S.C.

The Court must undertake an "individualized, case-byJones v. GNC
"To support

Goodyear Tire & Rubber

The Court weighs a series of factors in determining whether

Additionally, the Supreme Court

Piper Aircraft Co. v. Reyno, 454 U.S. 235, 260

Thus, where a "case has a significant connection to the

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IV.

DISCUSSION
The Court begins by analyzing Brosamer's motion to dismiss.

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Because Brosamer lacks standing to bring that motion, it is DENIED.

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The Court then turns to the alternative motion to transfer venue

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and weighs the factors set out in GNC Franchising.

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concludes that the factors weigh very strongly in favor of

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transferring this case to the Central District of California.

The Court

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A.

Motion to Dismiss for Improper Venue

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Brosamer first argues that venue is improper in this district

United States District Court

For the Northern District of California

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because Defendant O&G Industries, Inc. ("O&G") is not a resident of

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California.

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residents of California and venue is not proper under 28 U.S.C.

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Section 1391(b)(1).

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to this claim -- including both the events giving rise to the

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underlying state court action and the state court action itself --

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occurred in the Central District of California.

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Brosamer argues, venue is proper in the Central District of

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California only, pursuant to Section 1391(b)(2).

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As a result, Brosamer argues, not all defendants are

It is undisputed that the events giving rise

Therefore,

Brosamer lacks standing to raise a venue objection on O&G's

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behalf.

"[N]either personal jurisdiction nor venue is

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fundamentally preliminary in the sense that subject-matter

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jurisdiction is, for both are personal privileges of the defendant,

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rather than absolute strictures on the court, and both may be

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waived by the parties."

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173, 180 (1979).

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party to whom it applies.

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venue on the ground that it is improper as to a co-defendant."

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Pratt v. Rowland, 769 F. Supp. 1128, 1132 (N.D. Cal. 1991).

Leroy v. Great W. United Corp., 443 U.S.

"Improper venue is a defense personal to the
Thus one defendant may not challenge

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A

his first response to a complaint.

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raise improper venue as a defense must do so in their first

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defensive move.") (emphasis in original).

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American Home's complaint and, though O&G denied that all

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defendants are residents of California, it has not joined

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Brosamer's motion, nor has it contested venue in any way.

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No. 61 ("O&G Answer") ¶ 14.

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opportunity to contest venue, and Brosamer may not raise the issue

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United States District Court

defendant may bring a motion to dismiss for improper venue only in

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For the Northern District of California

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on O&G's behalf.

Id. ("[D]efendants wishing to

O&G has answered

See ECF

Therefore, O&G has forfeited its

The motion to dismiss is DENIED.

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B.

Transfer of Venue

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The Court turns now to Brosamer's alternative motion to

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transfer venue to the Central District of California.

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outset, it is important to note that nowhere in its fourteen page

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opposition brief does American Home offer a single reason that this

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case should be litigated in San Francisco.

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a plea that its choice of forum should be "accorded deference," but

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it offers no explanation or reason for that choice.

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10.

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are ample and obvious reasons that this case should be tried in the

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Central District, including that all of the events giving rise to

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this action occurred there, the insurance policies at issue were

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executed there, any witnesses or documentary evidence relevant to

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this case is there, and the underlying litigation is being heard in

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courts there.

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The closest it comes is

See Opp'n at

On the other hand (and as explained more fully below), there

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At the

Proper Venue in Transferor District

As described above, Brosamer contests only O&G's California
residency.

Brosamer does not deny that it and Tutor-Saliba are

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them is a resident of the Northern District.

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proper in this district so long as all defendants are residents of

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California.

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1392(d), O&G is a resident of the Central District of California if

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its contacts with that district are sufficient to subject it to

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personal jurisdiction there.

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California is in California, O&G's residency in that district would

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presumably render it a resident of California as a whole for the

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United States District Court

both residents of California, nor does it deny that at least one of

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For the Northern District of California

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purposes of Section 1391(b)(1).

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See 28 U.S.C. § 1391(b)(1).

Therefore, venue is

Under 28 U.S.C. Section

Because the Central District of

American Home does not allege that O&G is subject to general

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jurisdiction anywhere in California.

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that O&G is subject to specific personal jurisdiction. The Ninth

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Circuit has established a three-prong test for determining specific

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jurisdiction:
(1) The non-resident defendant must purposefully direct
his activities or consummate some transaction with the
forum or resident thereof; or perform some act by which
he purposefully avails himself of the privilege of
conducting activities in the forum, thereby invoking the
benefits and protections of its laws;

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Instead, American Home argues

(2) the claim must be one which arises out of or relates
to the defendant's forum-related activities; and

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(3) the exercise of jurisdiction must comport with fair
play and substantial justice, i.e. it must be reasonable.

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Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th

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Cir. 2004).

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two prongs and, if it does, the burden then shifts to the defendant

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to show why the exercise of personal jurisdiction would be

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unreasonable.

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The plaintiff bears the burden of satisfying the first

Id.

The allegations in the complaint make it clear that O&G is
subject to personal jurisdiction in the Central District of

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citizen of the Central District.

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(through the Joint Venture) with the City of Los Angeles to perform

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construction work for the City in the Central District.

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O&G therefore purposefully directed its activities at the Central

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District and consummated a transaction with at least two residents

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of the Central District (Tutor-Saliba and the City).

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also arises out of and relates to those activities: the work O&G

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performed in Los Angeles through its joint venture was allegedly

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United States District Court

California.

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For the Northern District of California

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O&G formed a joint venture with Tutor-Saliba, a

defective, and this is a related insurance lawsuit.

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indication that the exercise of jurisdiction in California does not

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comport with fair play and substantial justice; no defendant has

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suggested that the exercise of jurisdiction in California would be

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unfair. 3

Compl. ¶ 10.

O&G then contracted

Id. ¶ 21.

This claim

There is no

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As a result, the Court finds that all defendants are residents

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of California and that at least one is a resident of this district.

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As a result, venue is proper here pursuant to 28 U.S.C. Section

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1391(b)(1).

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2.

Action Might Have Been Brought in Transferee

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District
It is undisputed that venue is proper in the Central District

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of California.

As described above, all defendants are residents of

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California, and at least two are residents of the Central District

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(O&G through of its contacts related to this litigation, and Tutor-

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Saliba by its principal place of business).

Therefore venue is

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Indeed, O&G has answered American Home's complaint. While O&G
suggested that at least one defendant might not be a resident of
California, see O&G Answer ¶ 14, O&G never contests personal
jurisdiction.

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proper in the Central District pursuant to 28 U.S.C. Section

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1391(b)(1).

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District pursuant to 28 U.S.C. Section 1391(b)(2) because the

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events from which this suit arose took place there.
3.

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It also undisputed that venue is proper in the Central

Convenience and Interests of Justice

The Court now weighs the factors the Ninth Circuit has

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identified as relevant to determining whether a transfer of venue

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serves the convenience of the parties and the interests of justice.
i.

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United States District Court

For the Northern District of California

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Location Where the Agreements Were Executed

The contracts at issue in this case are the insurance policies

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that American Home issued to the City.

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the City of Los Angeles for a construction project that took place

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there.

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but all of the policies list addresses for both the insured and

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producer in Los Angeles.

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E at 4; F at 3, 10.

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favor of a transfer of venue.

Compl. ¶ 6.

ii.

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All of them were issued to

They do not specify where they were executed,

See Compl. Exs. B at 16; C at 2; D at 3;

The Court finds that this factor weighs in

State Most Familiar With Governing Law

This district and the Central District are both in California.

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Both are equally familiar with California law.

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neutral.

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iii.

This factor is

Plaintiff's Choice of Forum

Plaintiff American Home chose this district as the forum for

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this lawsuit and, by its opposition to this motion, demonstrated a

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strong preference for this suit to be heard in this district.

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Strangely, though, American Home is either unwilling or unable to

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articulate a single reason for that preference.

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incorporated in Pennsylvania and has its principal place of

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American Home is

is generally accorded substantial weight, and the defendant

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therefore bears a considerable burden in justifying transfer."

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Animal Legal Def. Fund v. U.S. Dep't of Agric., No. CV 12-4407-SC,

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2013 WL 120185, at *4 (N.D. Cal. Jan. 8, 2013).

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the operative facts have not occurred within the forum of original

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selection and that forum has no special interest in the parties or

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subject matter, the plaintiff's choice of venue merits less

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deference."

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United States District Court

business in New York.

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For the Northern District of California

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less deference when the plaintiff resides outside of the chosen

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forum."

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2014 WL 715082, at *3 (N.D. Cal. Feb. 14, 2014); see also Gemini

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Capital Grp., Inc. v. Yap Fishing Corp., 150 F.3d 1088, 1091 (9th

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Cir. 1998) ("the district court correctly acted on Ninth Circuit

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authority in granting Plaintiffs' choice of Hawaii as a forum less

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deference" where no plaintiff was a resident of Hawaii); Pac. Car &

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Foundry Co. v. Pence, 403 F.2d 949, 954 (9th Cir. 1968) ("If the

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operative facts have not occurred within the forum of original

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selection and that forum has no particular interest in the parties

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or the subject matter, the plaintiff's choice is entitled only to

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minimal consideration.").

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favors maintenance of this action in this district, but the Court

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assigns it very little weight.

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Id.

Compl. ¶ 9

"A plaintiff's choice of forum

However, "where

Additionally, "a plaintiff's choice is also given

Brown v. Abercrombie & Fitch Co., No. 4:13-CV-05205 YGR,

iv.

Thus the Court finds that this factor

Respective Parties' Contacts with the Forum

There is little evidence of the respective parties' contacts

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with this forum.

American Home asserts that Defendant Tutor-Saliba

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Corporation has "an extensive presence in the Northern District and

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particularly in the San Francisco Bay Area."

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Opp'n at 13.

California, which is in the Central District.

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fact, no party is is headquartered here.

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incorporated in Pennsylvania and has its principal place of

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business in New York; O&G is incorporated in Connecticut and has

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its principal place of business in Connecticut; Brosamer operates

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as the regional office of a parent company headquartered in

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Chicago.

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Thus there is no indication that any party to this case has any

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United States District Court

However, Tutor-Saliba's principal place of business is in Sylmar,

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For the Northern District of California

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relevant connection to this district.

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either involved in the construction or insurance of the

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construction project that occurred in the Central District.

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Court finds that this factor favors a transfer of venue.

In

American Home is

Id. ¶¶ 10-11; ECF No. 49 ("Klupp Decl.") ¶ 2, Ex. A.

v.

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Compl. ¶ 10.

By contrast, every party was

The

Contacts Relating to Plaintiff's Cause of
Action in the Chosen Forum

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No party has any contacts to this forum that relate to the

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Plaintiff's cause of action.

The construction project that forms

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the basis of this action occurred in the Central District; the

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insurance policies at issue in this case were issued to the City of

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Los Angeles, which is in the Central District; and the underlying

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state court lawsuit is taking place in the Central District.

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is no connection whatsoever between this lawsuit and the Northern

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District of California.

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contacts with the Central District relating to American Home's

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cause of action.

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a transfer of venue.

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There

By contrast, every party has substantial

The Court finds that this factor strongly favors

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vi.

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Differences in Costs of Litigation

American Home makes no argument that it will be cheaper to

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underlying action is already being litigated in Los Angeles, no

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potentially relevant witnesses or evidence is located in the

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Northern District (much of the evidence is likely to be located in

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the Central District), and the parties' counsel is located in Los

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Angeles.

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cost effective to try this case in the Central District.

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United States District Court

litigate this case in San Francisco.

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For the Northern District of California

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factor, too, favors a transfer of venue.

The Court finds that it will likely be significantly more

vii.

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On the other hand, the

This

Compulsory Process to Procure Witnesses

Federal Rule of Civil Procedure 45(a)(2) requires a subpoena

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to issue from the court where the action is pending.

Were venue to

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remain in this district, this Court would therefore be required to

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issue any subpoenas necessary to procure witnesses.

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witnesses are likely to be in the Central District, and motions to

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quash or modify would be made in the Central District.

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motions could be granted there or transferred back to this

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district.

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compliance with subpoena is sought to quash or modify improper

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subpoenas); Fed. R. Civ. P. 45(f) (permitting compliance court to

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transfer motions to issuing court).

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transferred to this Court, the Court would then need to transfer

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its order back to the Central District for enforcement.

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R. Civ. P. 45(f).

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procure witnesses in this case, the process would be much simpler

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if this case were heard in the Central District of California.

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///

But those

Those

See Fed. R. Civ. P. 45(d)(3) (requiring court where

If such a motion were

See Fed.

Thus while this Court has the necessary power to

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viii.

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Ease of Access to Sources of Proof

To the extent that witnesses or documentary evidence will be

witnesses and that evidence are located in the Central District.

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All of the events from which this action arose, whether related to

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the construction project or the underlying litigation, occurred in

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the Central District.

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to argue that any relevant evidence is located in the Northern

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District.

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United States District Court

necessary to resolve this case, it is undisputed that those

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For the Northern District of California

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is purely a matter of law and that no evidence will be required.

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See Opp'n at 11-13.

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witnesses located in the Central District who may provide relevant

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evidence.

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in a position to determine the admissibility of all of the evidence

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(or potential evidence) that the parties discuss.

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Court notes that American Home's pending motion for summary

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judgment absolutely touches on factual issues to which witness or

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documentary evidence may be relevant -- for example, the extent to

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which Defendants' construction work was defective.

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and undisputed that almost all witnesses and evidence relevant to

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this case are located in the Central District, and that none are

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located here.

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of venue.

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Indeed, American Home does not even attempt

Instead, American Home makes the case that this action

Brosamer disagrees and produces examples of

See Mot. at 11-12; Reply at 9-11.

The Court is not yet

However, the

It is obvious

The Court finds that this factor favors a transfer

ix.

Local Interest

The City of Los Angeles purchased the insurance policies at

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issue in this case, and the extent of the coverage offered by those

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policies is at issue.

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located in Los Angeles by producers located in Los Angeles.

The policies were issued to an insured

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The

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City of Los Angeles contracted for the allegedly defective

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construction work, and that work was done in Los Angeles.

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Defendant Tutor-Saliba is based in the Central District, while no

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party to this case is a citizen of this district.

Finally, the

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underlying lawsuit is taking place in Los Angeles.

For all of

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these reasons, the Central District has a substantial interest in

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the resolution of this case.

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whatsoever.
4.

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United States District Court

Conclusion

Venue is proper in both this district and the Central District

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For the Northern District of California

This district has no such interest

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of California.

However, it is abundantly clear that the

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convenience of the parties and the interests of justice

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overwhelmingly favor maintenance of this lawsuit in the Central

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District.

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the plaintiff's choice of forum, weighs against a transfer.

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the Court accords that factor very little weight because none of

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the events from which this case arose took place in this district

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and because the plaintiff is not a citizen or resident of this

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district.

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transferring this case to the Central District.

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obvious that it will be easier, faster, and more cost effective to

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litigate this case in the Central District, where virtually all of

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the events giving rise to this case occurred and where the

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underlying state court lawsuit is being tried.

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to transfer venue to the Central District of California is GRANTED.

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///

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///

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///

Of the factors identified in GNC Franchising, only one,

One factor is neutral.

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But

The others all favor
The facts make it

Brosamer's motion

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2

V.

CONCLUSION
For the foregoing reasons, Defendant R&L Brosamer, Inc.'s

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motion to dismiss for improper venue is DENIED.

Brosamer's

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alternative motion to transfer venue is GRANTED.

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the Clerk to transfer this case to the Central District of

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California.

The Court DIRECTS

All pending motion hearing dates are hereby VACATED.

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IT IS SO ORDERED.

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United States District Court

For the Northern District of California

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May 12, 2015
UNITED STATES DISTRICT JUDGE

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