Nova Group, Inc v. Universitas Education, LLC

Filing 22

ORDER granting Respondent's Motion To Dismiss the Petition or To Transfer the Action to the United States District Court for the Southern District of New York (Doc. No. 12 ). Signed by Judge Alvin W. Thompson on 11/16/2011. (Giering, A)

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
-------------------------------x
NOVA GROUP, INC.,
:
:
Petitioner,
:
v.
:
:
UNIVERSITAS EDUCATION, LLC,
:
:
Respondent.
:
-------------------------------x

Civ. No. 3:11CV342(AWT)

ORDER RE MOTION TO DISMISS OR TRANSFER
For the reasons set forth below, the respondent’s motion is
being granted and this action is being transferred to the
Southern District of New York.
Section 1404(a) provides that a district court may transfer
“any civil action to any other district or division where it
might have been brought” when such a transfer is “[f]or the
convenience of parties and witnesses, in the interest of
justice.”

28 U.S.C. § 1404(a).

“[M]otions for transfer lie

within the broad discretion of the district court and are
determined upon notions of convenience and fairness on a case-bycase basis.”

In re Cuyahoga Equip. Corp., 980 F.2d 110, 117 (2d

Cir. 1992).
The petitioner, Nova Group, Inc. (“Nova”), seeks to vacate
an American Arbitration Association (“AAA”) award of
approximately $26.5 million issued in favor of respondent
Universitas Education, LLC (“Universitas”).

-1-

Nova has its

principal place of business in Connecticut, and Universitas has
its principal place of business in New York.

Nova commenced this

action in Connecticut Superior Court and Universitas removed the
action to this court.

The parties disagree as to whether this

court lacks jurisdiction over Universitas.

However, “even if

there is no personal jurisdiction over the defendants, and
[regardless of] whether . . . venue is proper in the district,”
the court may transfer the case if a transfer would be “in the
interest of justice.”

Corke v. Sameiet M.S. Song of Nor., 572

F.2d 77, 80 (2d Cir. 1978).
The factors to be considered in connection with a motion
pursuant to § 1404(a) include:
(1) the plaintiff's choice of forum, (2) the
convenience of witnesses, (3) the location of
relevant documents and relative ease of access
to sources of proof, (4) the convenience of
the parties, (5) the locus of operative facts,
(6) the availability of process to compel the
attendance of unwilling witnesses, [and] (7)
the relative means of the parties.
Emp’rs Ins. of Wausau v. Fox Entm’t Grp., Inc., 522 F.3d 271, 275
(2d Cir. 2008) (citing D.H. Blair & Co. v. Gottdiener, 462 F.3d
95, 106-07 (2d Cir. 2006)).

Two additional factors that are

customarily included in § 1404(a) analysis in this district are
the district court’s familiarity with the governing law, and
trial efficiency and the interest of justice.

See Alden Corp. v.

Eazypower Corp., 294 F. Supp. 2d 233, 237 (D. Conn. 2003) (citing
-2-

U.S. Surgical Corp. v. Imagyn Med. Techs., Inc., 25 F. Supp. 2d
40, 46 (D. Conn. 1998)).

The burden of justifying a transfer

under § 1404(a) is ordinarily on the moving party.

See Factors

Etc., Inc. v. Pro Arts, Inc., 579 F.2d 215, 218 (2d Cir. 1978),
overruled on other grounds by Pirone v. MacMillan, Inc., 894 F.2d
579 (2d Cir. 1990).
First, as to the weight accorded the plaintiff’s (here the
petitioner’s) choice of forum, this factor weighs against
transfer.

The plaintiff’s choice of forum is “entitled to

substantial consideration.”
Cir. 1995).

In re Warrick, 70 F.3d 736, 741 (2d

However, “a plaintiff’s choice of forum is given

less weight where the case’s operative facts have little
connection with the chosen forum.”
F. Supp. 2d at 237.

Alden v. Eazypower Corp., 294

See also TM Claims Serv. v. KLM Royal Dutch

Airlines, 143 F. Supp. 2d 402, 404 (S.D.N.Y. 2001); 800-Flowers,
Inc. v. Intercontinental Florist, Inc., 860 F. Supp. 128, 134
(S.D.N.Y. 1994).

As discussed below, that is the situation here.

Thus, this factor weighs against transfer, but it should not be
given substantial weight.
Second, as to the convenience of witnesses, the court
concludes that this is a neutral factor.

Universitas states that

it does not anticipate that any witnesses will be called in any
action to confirm or vacate the arbitration award, and Nova does
not dispute this point.

-3-

Third, as to the location of relevant documents and relative
ease of access to sources of proof, the court concludes that this
is a neutral factor.

A motion to confirm or vacate an award is

resolved based on the record created during the arbitration, and
here that record is in the possession of both parties in
electronic format.

See Jones v. Walgreen Co., 463 F. Supp. 2d

267, 277 (D. Conn. 2006) (where documents “are in electronic
format that could be transmitted with relative ease,” the
location-of-documents factor “has no bearing on the decision to
transfer.”).
Fourth, as to the convenience of the parties, the court
concludes that this factor weighs in favor of transfer.

The

Charter Oak Trust Welfare Benefit Plan (the “Plan”), which was
created by Nova, provides that the exclusive venue for resolving
disputes arising under the Plan is arbitration before the AAA in
New York, New York.

Nova’s conduct shows that the Southern

District of New York is a convenient forum for it.

Universitas

contends that paying for local counsel for litigation in
Connecticut would strain its limited financial resources,
especially while it is continuing to incur legal fees for
proceedings in New York.

The AAA recognized that Universitas has

limited financial resources by granting Universitas a deferral of
its share of the arbitration fees in June 2010, at the
arbitration’s outset.

-4-

Fifth, as to the locus of operative facts, the court
concludes that this factor weighs in favor of transfer.

To

determine the locus of operative facts, a court must look to the
“site of the events from which the claim arises.”
Eazypower Corp., 294 F. Supp. 2d at 237.

Alden v.

The petitioner is

seeking to vacate an arbitration award issued in New York.
Although both the Plan and the arbitration are governed by
Connecticut law, no part of the arbitration took place in
Connecticut.

Therefore, the locus of operative facts is the

Southern District of New York.

See Crow Constr. Co. v. Jeffrey

M. Brown Ass’n, Inc., No. 01 CIV 3839, 2001 WL 1006721, at *3-4
(S.D.N.Y. Aug. 31, 2001) (locus of operative facts is the place
where arbitration occurred).

Nova argues that Universitas and

its agents engaged in a systematic and continuous pattern of
communication with Nova in Connecticut, seeking to obtain life
insurance proceeds.

However, the contacts that were in fact made

by Universitas and its agents with Nova in Connecticut were all
made in an effort to persuade Nova not to withhold the monies
Universitas claimed were due.

Thus, the contacts were made after

the claim arose, as opposed to being events from which the claim
arose.
Sixth, as to the availability of process to compel unwilling
witnesses, the court concludes that this is a neutral factor.
Universitas states that no witnesses will be called in this case,

-5-

and Nova does not dispute this point.
Seventh, as to the relative means of the parties, the court
concludes that this factor weighs in favor of transfer.

The

president of Nova submitted an affidavit in connection with the
arbitration, attesting to the fact that the Plan’s assets
exceeded $35 million.

As mentioned above, the AAA recognized

that Universitas has limited financial resources.
Eighth, as to the district court’s familiarity with the
governing law, the court concludes that this is a neutral factor.
This case will require the application of federal law and
Connecticut law, which the courts in both jurisdictions are
capable of applying.

See Mak Mktg. Inc. v. Kalapos, 620 F. Supp.

2d 295, 311-12 (D. Conn. 2009)(“the ‘governing law’ factor is to
be accorded little weight on a motion to transfer venue because
federal courts are deemed capable of applying the substantive law
of other states.”).
Ninth, as to trial efficiency and the interest of justice,
the court concludes that this factor weighs heavily in favor of
transfer.

“There is a strong policy favoring the litigation of

related claims in the same tribunal in order that pretrial
discovery can be conducted more efficiently, duplicitous
litigation can be avoided, thereby saving time and expense for
both parties and witnesses, and inconsistent results can be
avoided.”

Wyndham Assoc. v. Bintliff, 398 F.2d 614, 619 (2d Cir.

-6-

1968); accord Somerville v. Major Exploration, Inc., 576 F. Supp.
902, 908 (S.D.N.Y. 1983) (“The existence of a related action in
the transferee district is a strong factor to be weighed in the
interest of judicial economy.”).

The Southern District of New

York is the forum of two proceedings involving the petitioner and
the respondent concerning the matters being contested in this
action.

First, the $26.5 million award was the result of a

three-day “Phase One” hearing that took place entirely in New
York, and the parties are bound to arbitrate
York.

“Phase Two” in New

Second, the respondent’s motion to confirm the arbitration

award is currently pending in the Southern District of New York.
Given that trial efficiency and the interest of justice
weigh heavily in favor of transfer; that the convenience of the
parties, the locus of operative facts and the relative means of
the parties weigh in favor of transfer; that the plaintiff’s
choice of forum weighs against transfer but should not be given
substantial weight; and that the remaining factors are neutral,
the court concludes that the respondent has met its burden of
demonstrating that the balance of convenience favors transfer to
the Southern District of New York.

In fact, the pertinent

factors militate strongly in favor of such a transfer.
Finally, for the reasons set forth by Universitas in its
reply memorandum (Doc. No. 20), the court concludes that the
first-filed doctrine does not apply here because the § 1404(a)

-7-

factors militate strongly in favor of transfer to the Southern
District of New York, and Nova’s filing in Connecticut was an
improper anticipatory filing.

See N.Y. Marine & Gen. Ins. Co. v.

Lafarge N. Am., Inc., 599 F.3d 102, 112 (2d Cir. 2010) (the
first-filed rule for determining the proper venue is inapplicable
when there are special circumstances such as manipulative
behavior or when the balance of convenience favors the secondfiled action).
Accordingly, Respondent’s Motion to Dismiss the Petition or
to Transfer the Action to the United States District Court for
the Southern District of New York (Doc. No. 12) is hereby
GRANTED.

The Clerk is ordered to transfer this action to the

Southern District of New York.
It is so ordered.
Dated this 16th day of November, 2011 at Hartford,
Connecticut.

/s/
Alvin W. Thompson
United States District Judge

-8-