Pharmerica Corporation v. Crestwood Care Centre, L.P.
Filing
31
MEMORANDUM AND OPINION by Senior Judge Charles R. Simpson, III on 9/25/13; The court will grant 11 Crestwood's motion to transfer venue by separate order. cc:counsel (DJT) [Transferred from Kentucky Western on 9/27/2013.]
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE
PHARMERICA CORPORATION
v.
PLAINTIFF
CIVIL ACTION NO. 3:12-CV-00511-CRS
CRESTWOOD CARE CENTER, L.P.
DEFENDANT
MEMORANDUM OPINION
This case is before the court on motion of the defendant, Crestwood Care Center, L.P.
(“Crestwood”), to transfer venue to the United States District Court for the Northern District of
Illinois, Chicago Division (DN 11). For the reasons set forth below, the Court will grant the
motion to transfer venue.
BACKGROUND
This case involves a contract dispute between Plaintiff Pharmerica Corporation
(“Pharmerica”) and Defendant Crestwood. In accordance with a “Pharmacy Services
Agreement” entered into by the parties, Pharmerica provided pharmacy-related goods and
services to the residents of a nursing home operated by Crestwood. (First Am. Compl., DN 5, at
¶¶ 7, 8). Crestwood allegedly refused to pay for these goods and services, (First Am. Compl. at ¶
1), whereupon Pharmerica filed suit against Crestwood seeking to recover damages based on
breach of contract, promissory estoppel, unjust enrichment, and account stated. (First Am.
Compl. at ¶¶ 23–49). In response, Crestwood has filed the present Motion to Transfer Venue
requesting that this Court transfer the action to the Northern District of Illinois, Chicago
Division.
STANDARD
Section 1404(a) provides that “For the convenience of parties and witnesses, in the
interest of justice, a district court may transfer any civil action to any other district or division
where it might have been brought.” 28 U.S.C. § 1404(a). “[I]n ruling on a motion to transfer
under § 1404(a), a district court should consider the private interests of the parties, including
their convenience and the convenience of potential witnesses, as well as other public-interest
concerns, such as systemic integrity and fairness, which come under the rubric of ‘interests of
justice.’” Moses v. Bus. Card Exp., Inc., 929 F.2d 1131, 1137 (6th Cir.1991). Although “district
courts have ‘broad discretion’ to determine when party ‘convenience’ or ‘the interest of justice’
make a transfer appropriate,” Reese v. CNH America LLC, 574 F.3d 315, 320 (6th Cir. 2009),
courts within the Sixth Circuit have identified nine factors that should be considered in making
this determination. These factors include:
(1) the convenience of witnesses; (2) the location of relevant documents and relative ease of
access to sources of proof; (3) the convenience of the parties; (4) the locus of the operative facts;
(5) the availability of process to compel the attendance of unwilling witnesses; (6) the relative
means of the parties; (7) the forum's familiarity with the governing law; (8) the weight accorded
the plaintiff's choice of forum; and (9) trial efficiency and the interests of justice, based on the
totality of the circumstances.
See Long John Silver's, Inc. v. Nickleson, No. 3:11–CV–93–H, 2011 WL 5025347, at *4 (W.D.
Ky. Oct. 21, 2011); Cowden v. Parker & Associates, Inc ., No. 5:09–CV–0323–KKC, 2010 WL
715850, at *2 (E.D. Ky. Feb. 22, 2010); Perceptron, Inc. v. Silicon Video, Inc., 423 F.Supp.2d
722, 729 (E.D. Mich. 2006).
The moving party bears the burden of demonstrating that the balance of these factors
weighs in favor of transfer. Adams v. Honda Motor Co., No. 3:05–CV–120–S, 2005 WL
3236780, at *1 (W.D. Ky. Nov. 21, 2005). Although “the plaintiff's choice of forum should
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rarely be disturbed… unless the balance [of convenience] is strongly in favor of the defendant,”
Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508, (1947), the plaintiff’s choice is by no means
dispositive. Lewis v. ACB Business Services, Inc., 135 F.3d 389, 413 (6th Cir. 1998). Instead, the
court’s decision must be based on an “individualized, case-by-case consideration of convenience
and fairness” that accords every relevant factor its due consideration and appropriate weight. Van
Dusen v. Barrack, 376 U.S. 612, 622 (1964).
DISCUSSION
The parties do not dispute that this action could have originally been brought in the
Northern District of Illinois. Thus, the only issue presented for the Court’s decision is whether
transfer is justified in light of the relevant public and private-interest factors. After considering
all relevant factors, the Court concludes that the more appropriate forum for the resolution of this
case is the Northern District of Illinois. Therefore, the Court will grant the motion to transfer
venue.
i.
Convenience of the Witnesses
All of the witnesses that have been identified by the parties are located in the Northern
District of Illinois.1 These include Pharmerica’s Pharmacy Director Paul Colletti, Crestwood’s
President Shael Bellows, and former Crestwood employee Arisha Cardozo, all of whom live and
work in the Chicago area. See (Declaration of Shael Bellows, DN 11-1, at ¶¶ 1, 4, 10, 11).
Although the convenience of party witnesses is generally not a significant factor in determining
whether transfer is appropriate, see
1
Although Pharmerica submits that “not all witnesses have been identified or located,” (Resp. in Opp’n to Mot. to
Transfer, DN 16, at 5), Pharmerica cannot avoid transfer by relying solely on the bare possibility that there might be
other witnesses without evidence suggesting that such witnesses actually exist. Thus, for the purposes of deciding
Crestwood’s Motion to Transfer Venue, the Court will only address the convenience of those witnesses identified by
the parties in their briefs.
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Boiler Specialist, LLC v. Corrosion Monitoring Services, Inc., No. 1:12–CV–47, 2012 WL
3060385, at *3 (W.D. Ky. July 26, 2012) (stating that the “inconvenience [of non-party
witnesses] is not given great weight in the transfer analysis.”), it deserves consideration in cases
such as this where all party witnesses reside in the same locale. See Global Fitness Holdings,
LLC v. Fed. Recovery Acceptance, Inc., No. 5:12–314, 2013 WL 1187009, at *4 (E.D. Ky. Mar.
20, 2013) (concluding that the convenience of party witnesses did not favor transfer because
“neither forum will be convenient for all party witnesses.”) (emphasis added). In any event,
however, the fact that the sole non-party witness is also located in Illinois would itself be
sufficient for the convenience of the witnesses to weigh in favor of transfer. See Boiler
Specialist, 2012 WL 3060385, at *3 (“Although convenience to party witnesses is important, ‘[i]t
is the convenience of non-party witnesses... that is the more important factor and is accorded
greater weight.’”) (alteration in original). Thus, this factor weighs strongly in favor of transfer. 2
ii.
Relative Ease of Access to Sources of Proof
Because the only non-testimonial evidence in this case consists of books, records, and
other tangible or electronic documents, the ease of accessing sources of proof will be equivalent
in either forum. Although Crestwood argues that certain documents and records could be more
easily obtained if the case were transferred to the Northern District of Illinois, technological
advancements have made the electronic storage and transmission of information sufficiently
expedient that the ease of accessing such evidence is not a major concern. See Cowden v. Parker
& Associates, Inc., No. 5:09–CV–0323–KKC, 2010 WL 715850, at *4 (E.D. Ky. Feb. 22, 2010)
(holding that “the location of documentary evidence” did not weigh in favor of transfer because
2
Although the testimony of these witnesses could be secured by deposition pursuant to Fed.R.Civ.P. 32(a)(4)(B),
the Court is reluctant to force the parties to try their cases solely on deposition. See Gulf Oil Corp. v. Gilbert, 330
U.S. 501, 511 (1947) (stating that “to fix the place of trial at a point where litigants cannot compel personal
attendance and may be forced to try their cases on deposition, is to create a condition not satisfactory to court, jury
or most litigants.”); Valvoline Instant Oil Change Franchising, Inc. v. RFG Oil, Inc., 12–CV–39–KSF, 2012 WL
3613300, at *9 (E.D. Ky. Aug. 22, 2012).
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“technological advancements have facilitated the electronic storage and transmission of
documents from one forum to another.”). Thus, this factor is a wash.
iii.
Convenience of the Parties
Although Pharmerica objects that transfer would merely shift the burden of
inconvenience, (Resp. in Opp’n to Mot. to Transfer Venue, DN 16, at 3), the respective
geographic location of the parties as well as Pharmerica’s litigation history suggests that the
aggregate amount of party inconvenience would be significantly less if this case were transferred
to the Northern District of Illinois. Whereas Pharmerica regularly conducts business in both
Kentucky and Illinois, see (Mot. to Transfer Venue, DN 11, at 5), Crestwood operates
exclusively in Illinois, see (Declaration of Shael Bellows, DN 11-1, at ¶ 9). Moreover,
Pharmerica has filed at least three cases in the Northern District of Illinois within the past five
years.3 Given Pharmerica’s willingness to conduct its affairs in the Northern District of Illinois, it
is unlikely that Pharmerica would be significantly inconvenienced by having this case transferred
there. In the absence of evidence suggesting that it would be equally convenient for Crestwood to
litigate in the Western District of Kentucky, the Court thus concludes that the convenience of the
parties weighs in favor of transfer.
iv.
Locus of Operative Facts
The contract at issue was negotiated, executed, and performed in the Northern District of
Illinois. (Declaration of Shael Bellows at ¶¶ 5, 8). The only connection that the contract has with
Kentucky is the fact that Pharmerica’s principal place of business is located in Louisville. (Resp.
in Opp’n to Mot. to Transfer Venue at 6). Thus, the locus of the operative facts clearly weighs in
favor of transfer.
3
These cases include: Pharmerica Chicago, Inc. v. Meisels, No. 1:10-cv-02741 (N.D. Ill. filed May 3, 2010);
Pharmerica Corp. v. Advanced Healthcare Solutions, LLC, No. 1:10-cv-00349 (N.D. Ill. filed Jan. 19, 2010);
Pharmerica Chicago, Inc. v. West Suburban Care Center, LLC, No. 1:08-cv-03775 (N.D. Ill. filed July 2, 2008).
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v.
The Forums’ Relative Familiarity with Applicable Law
To decide whether transfer is appropriate in light of the forums’ relative familiarity with
the applicable law, the Court must first determine which state’s substantive law will apply. When
a case is transferred pursuant to section 1404(a), the court “must apply the choice-of-law rules of
the State from which the case was transferred.” Piper Aircraft Co. v. Reyno, 454 U.S. 235, 243 n.
8 (1981). Thus, regardless of whether the case is transferred, the choice-of-law issue will be
governed by Kentucky law, which provides that contract disputes are governed by the law of the
state with the most significant relationship to the contract. Breeding v. Mass. Indem. & Life Ins.
Co., 633 S.W.2d 717, 719 (Ky. 1982). Given that the contract at issue was negotiated, executed,
and performed in Illinois, (Declaration of Shael Bellows at ¶¶ 5, 8), there is little doubt that the
state with the most significant relationship to the contract is Illinois. Thus, Illinois contract law
will ultimately govern the resolution of this case. Although this Court is certainly competent to
interpret and apply Illinois contract law, the greater familiarity of Illinois courts with Illinois case
law makes transfer the preferred course of action. See Global Fitness Holdings, LLC v. Fed.
Recovery Acceptance, Inc., No. 5:12–314, 2013 WL 1187009, at *4 (E.D. Ky. Mar. 20, 2013)
(“While this Court certainly can apply non-forum law to the facts of a particular case, this factor
nevertheless favors transfer to a Utah court with greater familiarity with Utah case law.”). Thus,
this factor weighs in favor of transfer.
vi.
The Weight Accorded the Plaintiff’s Choice of Forum
“[U]nless the balance [of convenience] is strongly in favor of the defendant, the plaintiff's
choice of forum should rarely be disturbed.” Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947).
However, the weight accorded the plaintiff’s choice of forum “is… reduced… where the facts
bear little connection to the chosen forum.” Adams v. Honda Motor Co., No. 3:05–CV–120-S,
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2005 WL 3236780, at *1 (W.D. Ky. Nov. 21, 2005) (citing Arrow Electronics, Inc. v.
Ducommun Inc., 724 F.Supp. 264, 265 (S.D.N.Y. 1989)). Because the Western District of
Kentucky has no connection with this case beyond the fact that Pharmerica’s principal place of
business is located in Louisville, the Court concludes that Pharmerica’s choice of forum should
not receive as much weight as the plaintiff’s choice of forum generally deserves. Thus, although
Pharmerica’s choice of forum must be considered as a factor weighing against transfer, it will be
accorded little weight.
vii.
Trial Efficiency and the Interests of Justice
The relative efficiency of resolving the case in either forum is more or less identical.
Although Crestwood has cited various statistics suggesting that litigation in the Northern District
of Illinois would be more efficient than litigation in the Western District of Kentucky, (Mot. to
Transfer Venue, DN 11, at 8–9), the differences revealed by these statistics are so insignificant
that they do not warrant consideration in the transfer analysis. Thus, the trial-efficiency factor is
a wash.
With respect to the interests-of-justice factor, Pharmerica and Crestwood advance
competing public interests that they claim would be served by litigating the case in their
respective forums of choice. According to Crestwood, the Illinois public has an important
interest in resolving this case locally because the contract at issue concerns the provision of
prescription medications and other services to nursing home patients who reside in the Northern
District of Illinois. (Mot. to Transfer Venue at 8). On the other hand, Pharmerica argues that the
Kentucky public has an equally important interest in having its courts “adjudicat[e] disputes
arising from contracts to which its corporate residents are parties.” (Resp. in Opp’n to Mot. to
Transfer Venue, DN 16, at 6). Although these interests are both important, the Court concludes
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that the public interest of Illinois should be accorded greater weight because of its direct
relationship with the subject matter of the contract. In comparison, the interest of the Kentucky
public is abstract and unrelated to the specific circumstances of this case. For these reasons, the
interests-of-justice factor weighs in favor of transfer.
CONCLUSION
After considering all relevant factors, the Court concludes that the Northern District of
Illinois is the most appropriate venue for resolving this case. Litigation in that venue will not
only be more convenient for the parties and the witnesses, but will also ensure that the case will
be decided by judges most familiar with the applicable law. Moreover, transfer will serve to
protect the interest of the Illinois public in having its courts resolve a dispute which concerns the
health and well-being of its residents. Taken together, these factors are more than sufficient to
overcome the slight weight accorded Pharmerica’s choice of forum. For these reasons, the Court
will grant Crestwood’s Motion to Transfer Venue by separate order.
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September 25, 2013
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