Advance Products Inc v. SFI of Tennessee LLC
Filing
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OPINION AND ORDER DENYING 14 MOTION to Transfer Case to the Western District of Tennessee filed by SFI of Tennessee LLC. Signed by Magistrate Judge Andrew P Rodovich on 8/23/11. (kjp)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
ADVANCE PRODUCTS, INC.,
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Plaintiff
v.
SFI OF TENNESSEE, LLC,
Defendant
CIVIL NO. 2:11 cv 113
OPINION AND ORDER
This matter is before the court on the Motion to Transfer
Venue to the Western District of Tennessee [DE 14] filed by the
defendant, SFI of Tennessee, LLC, on June 8, 2011.
For the
following reasons, the motion is DENIED.
Background
This matter arises from a contract dispute between the
plaintiff, Advance Products, Inc., and the defendant, SFI of
Tennessee, LLC.
SFI is a Tennessee limited liability company
whose members are citizens of the State of Indiana.
Advance
Products is an Illinois corporation whose principal place of
business is in Calumet City, Illinois. On July 1, 2002, Advance
Products and SFI entered into a Manufacturer-Manufacturer’s Agent
Agreement whereby Advance Products was to serve as an independent
sales representative for SFI’s products to national accounts
identified in the agreement.
The contract contained a clause
that allowed either party to cancel the contract with proper
notice subject to certain provisions.
On December 16, 2010, SFI
notified Advance Products that it was terminating the agreement
because Advance Products did not perform as required under the
agreement.
SFI refused to compensate Advance Products for its
outstanding commissions and indicated it would not comply with
the termination provision requiring SFI to pay commissions on all
accounts listed in the agreement for three years following the
date of termination.
Advance Products filed a complaint with
this court, alleging breach of the parties' agreement.
SFI now
moves to transfer this matter to the Western District of Tennessee.
The parties dispute which is the appropriate forum and
where the material witnesses and evidence can be found.
SFI represents that the material events giving rise to this
claim occurred in Tennessee.
The receipt of orders from Advance
Products’ sales territory and payment for shipped orders, the
evaluation of Advance Products’ sales performance under the
agreement, the accounting of and payment of Advance Products'
commissions, and the decision to terminate Advance Products all
occurred in Memphis, Tennessee.
SFI further states that the
majority of the evidence and witnesses are located in Tennessee,
including the vice presidents of sales and operations who decided
to terminate the agreement and the personnel who calculated and
issued Advance Products' commission.
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Advance Products responds that its two principals reside in
the Northern District of Indiana and that its main office is less
than one mile from the courthouse, albeit in Illinois.
Other
witnesses affiliated with Electro-Motive Diesel, the only account
Advance Products serviced, are located in LaGrange, Illinois,
which is within 100 miles of the courthouse and subject to the
court’s subpoena powers.
SFI’s former Vice President, Eddie
Hollomon, was Advance Products’ main contact and now resides in
Rochester Hills, Michigan, and Jeff Brannon, a former SFI sales
manager, also resides in Michigan.
Both are within a four to
five hour drive of Hammond, Indiana, and a 13 hour drive to
Tennessee.
Advance Products primarily operated in the Chicago,
Illinois area through its service of the Electro-Motive account
and in Indiana where Advance Products' corporate officers reside
and SFI’s managing members maintained offices.
Documents relat-
ing to Advance Products' sales and relationship with ElectroMotive are located at Advance Products' Calumet City, Illinois
location.
Discussion
A party seeking to transfer venue pursuant to 28 U.S.C.
§1404(a) must show that "(1) venue is proper in the transferor
district, (2) venue and jurisdiction are proper in the transferee
district, and (3) the transfer will serve the convenience of the
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parties, the convenience of the witnesses, and the interest of
justice." Vandeveld v. Christoph, 877 F.Supp. 1160, 1167 (N.D.
Ill. 1995); Allied Van Lines, Inc. v. Aaron Transfer and Storage,
Inc., 200 F.Supp.2d 941, 946 (N.D. Ill. 2002) (stating that the
"moving party bears the burden of establishing that the transferee court is the more convenient forum"). The court must consider public and private interests when assessing a motion to
transfer venue. Generally, in considering the private interests,
the court looks to "(1) plaintiff's choice of forum, (2) the
situs of the material events, (3) the relative ease and access to
sources of proof, (4) the convenience of the parties and (5) the
convenience of the witnesses." First National Bank v. El Camino
Resources, Ltd., 447 F.Supp.2d 902, 912 (N.D. Ill. 2006). See
also DePuy Orthopaedics, Inc. v. Gault South Bay, Inc., 2007 WL
3407662, *8 (N.D. Ind. Nov. 13, 2007). The public interests that
are relevant to an analysis under §1404(a) include the court’s
familiarity with applicable law, the efficiency with which the
court may resolve the matter, and the desirability of resolving
disputes in the region in which they arose. First National Bank,
447 F.Supp.2d at 912; Travel Supreme, Inc. v. Nver Enterprises,
Inc., 2007 WL 2962641, *10 (N.D. Ind. Oct. 5, 2007). It is within
the court's discretion to weigh these factors. Allied Van Lines,
200 F.Supp.2d at 946. The court considers these factors in a
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"flexible and individualized analysis." Stewart Organization,Inc.
v. Ricon Corp., 487 U.S. 22, 29, 108 S.Ct. 2239, 2244, 101
L.Ed.2d 22 (1988). However, "unless the balance is strongly in
favor of the defendant, the plaintiff’s choice of forum should
rarely be disturbed." In re National Presto Industries, 347 F.3d
662, 664 (7th Cir. 2003).
The parties do not dispute that venue is proper in this
court or that the Western District of Tennessee may be an appropriate forum.
The focus of this dispute concerns which district
is proper in light of the locations of the parties and witnesses,
the availability of evidence, and the interests of justice.
The court gives great weight to the convenience of witnesses
when deciding whether to transfer venue.
Hanley v. Omarc, Inc.,
6 F.Supp.2d 770, 775 (N.D. Ill. 1998) ("The convenience of
witnesses is often viewed as the most important factor in the
transfer balance.").
"Convenience considerations include the
number of witnesses involved, travel distances and associated
costs for these witnesses, the willingness of the witnesses to
appear, or whether the witness is within the court’s reach to
compel appearance."
Brotherhood Mutual Insurance Co. v. GuideOne
Mutual Insurance Co., 2011 WL 1627114, *4 (N.D. Ind. April 28,
2011).
The party moving to transfer venue must demonstrate
precisely who the witnesses are and why they are important so the
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court may afford the appropriate weight to this factor.
Franchetti, 713 F.Supp. 1203, 1214 (N.D. Ill. 1989).
Rose v.
Otherwise,
this factor may be weighed only marginally, if at all, in favor
of the moving party.
Rose, 713 F.Supp. at 1214.
It is insuffi-
cient for the moving party simply to state that a number of witnesses reside in or near the forum to which the party desires to
have the case transferred without identifying the witnesses and
their proposed testimony.
See Popovich v. Weingarten, 2010 WL
4318798 (N.D. Ind. Oct. 25, 2010) (explaining that the moving
party must identify the potential witnesses and their proposed
testimony).
The convenience of both the parties and the witnesses
appears to be equally distributed between the Northern District
of Indiana and the Western District of Tennessee.
Although SFI
has pointed to several witnesses with knowledge of the matter who
reside in Tennessee, including the vice presidents of sales and
operations who made the decision to terminate the parties'
agreement and the personnel who calculated Advance Products'
commission, there are equally important witnesses within the
subpoena power of this court.
The commissions in dispute arose from Advance Products'
relationship with Electro-Motive, a company within this court’s
subpoena powers.
Although SFI represents that it is in the
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process of identifying representatives from the other accounts
Advance Products serviced, two of which have manufacturing
facilities in Tennessee, SFI has not identified who these witnesses are or where they are located.
Therefore, the court
cannot accurately assess the conveniences for these witnesses.
See Rose, 713 F.Supp. at 1214 (explaining that the moving party
must identify who the witnesses are and the importance of their
testimony).
Furthermore, all of the Advance Products employees
and directors are located near the Northern District of Indiana
and their main contact to SFI is located significantly closer to
this forum than the Western District of Tennessee.
members within the Northern District of Indiana.
SFI also has
SFI has not
demonstrated that the testimony of its personnel in Tennessee is
more essential and plays a larger role in the dispute than
Advance Products' personnel who entered and performed under the
agreement.
Because the witnesses essential to the dispute reside
both within the subpoena power of this court and the Western
District of Tennessee, and there is no clear distribution of
witnesses in favor of the Western District of Tennessee, this
factor becomes neutral in the court’s analysis.
See Rose, 713
F.Supp. at 1214 (finding that this factor is neutral where the
moving party fails to show evidence suggesting that the plaintiff
would be less inconvenienced at the transferred venue).
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The same is true with regard to the access to documents and
sources of proof.
Although the documents used to calculate
commissions and those SFI maintained with regard to the parties'
agreement may be located within the Western District of Tennessee, SFI has not shown that Advance Products does not have
possession of any documents relevant to the dispute.
To the
contrary, Advance Products represents that it has documents
relating to the parties' agreement, the subsequent breach, and
the commissions it now alleges are due under the agreement.
Evi-
dence concerning Advance Products' relationship with ElectroMotive, the company from whom the commission was earned, also is
located within or near the Northern District of Indiana.
SFI has
not identified the specific evidence that it argues is located in
Tennessee or its relevance to the case and has failed to meet its
burden to show that a significant amount of the evidence necessary for adjudication is located within the Western District of
Tennessee.
Rather, it is apparent that both SFI, within Tennes-
see, and Advance Products and Electro-Motive, located near the
Northern District of Indiana, possess evidence related to the
present dispute.
Absent a more specific identification of the
volume of documents SFI purports are present in Tennessee, the
court cannot count this factor in favor of SFI.
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The court also must take into consideration the situs of
material events giving rise to the dispute.
The decision to
terminate the agreement was made in Tennessee, but the decision
was based on acts that occurred in Illinois and during Advance
Products' interactions with Electro-Motive.
SFI is correct that
the majority of the actions occurred outside of Indiana, both in
Tennessee and Illinois, and that the only connection to Indiana
is the residency of two of Advance Products' employees.
However,
the events that occurred in Illinois were carried out within a
short distance from the Indiana courthouse.
Therefore, this
factor weighs in favor of transfer, but only marginally given the
proximity of the events that occurred in Illinois to this district.
Finally, the court must consider the interests of justice,
a broad category relating to the "efficient functioning of the
courts, not to the merits of the underlying dispute."
Van Dorn Iron Works, 796 F.2d 217, 221 (7th Cir. 1986).
Coffey v.
The
court considers the congestion of the court dockets, the local
interests, and the familiarity with governing law.
First Na-
tional Bank, 447 F.Supp.2d at 912; Travel Supreme, Inc., 2007 WL
2962641 at *10.
The parties dispute which law governs their agreement, and
their agreement does not have a choice of law clause to guide the
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dispute.
SFI argues that Tennessee law governs the dispute
because the events giving rise to Advance Products' allegations
occurred in Tennessee, namely the decision to terminate the
agreement and to refuse to pay commissions.
Advance Products,
however, argues that Illinois law applies.
In any case, courts
are competent to interpret another state’s laws that are not
particularly complex.
Stanley v. Marion, 2004 WL 1611074, *4-5
(N.D. Ill. July 16, 2004) ("[W]here the law in question is
neither complex nor unsettled, the interests of justice remain
neutral between competing courts.") (citing Amoco Oil Co. v.
Mobil Oil Corp., 90 F.Supp.2d 958, 962 (N.D. Ill. 2000) (noting
that "contract law is not particularly complex" and is well
within the comprehension of a foreign forum)).
The court has yet
to determine the appropriate state’s laws to apply, and SFI has
not demonstrated conclusively that Tennessee law governs the
dispute.
Should Illinois law govern the agreement, either court
would be forced to interpret a foreign state’s laws.
And, even
if Tennessee law applies, SFI has not demonstrated that the
Tennessee contract law is so complex as to require transfer.
See
Amoco, 90 F.Supp.2d at 962 (explaining that contract law is not
generally complex and that courts are often called upon to interpret the law of another forum).
This court is competent to hear
cases involving the application of another state’s law, particu-
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larly if the law is not complex.
Stanley, 2004 WL 1611074 at *4-5.
Amoco, 90 F.Supp.2d at 962;
A foreign state’s contract law
generally is not regarded as so complex to require transfer
absent a demonstration otherwise.
Amoco, 90 F.Supp.2d at 962.
Because it is not clear that Tennessee law applies, and the court
does not have enough information before it to make the determination at this time, nor has SFI established that the applicable
law is so complex to warrant transfer, SFI failed to meet its
burden to show transfer is warranted under this element.
factor is neither weighed in favor or against transfer.
This
See
Amoco, 90 F.Supp.2d at 962 (explaining that when a court is asked
to interpret foreign law that is not particularly complex, this
factor is weighed neither for nor against transfer).
The congestion of the court dockets weighs marginally in
favor of refusing transfer.
The average time to resolve a matter
through trial in the Northern District of Indiana is 23.9 months
and 24.6 months in the Western District of Tennessee.
The over-
all average time to resolve a dispute is 9.7 months in the Northern District of Indiana and 11.2 months in the Western District
of Tennessee.
Although this difference is minimal, it weighs in
favor of refusing transfer.
Finally, SFI argues that Tennessee has a greater interest in
the dispute than Indiana.
Because the events that gave rise to
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this case occurred predominately in Tennessee and Illinois, SFI
is correct that Tennessee has a greater interest in the outcome
of this case than Indiana, and the court weighs this factor in
favor of transfer.
Overall, SFI has failed to demonstrate that transfer is
justified.
Although SFI’s employees reside in Tennessee, the
Northern District of Indiana is more convenient for Advance
Products' employees.
There are witnesses near both locations,
and SFI has not convinced the court that the witnesses are predominately located near the Western District of Tennessee, nor
has SFI explained the proposed testimony of these witnesses and
why their testimony is essential to the matter.
Documents and
proof are located within or near both districts.
If the court
were to transfer the case, it would merely be a transfer of
conveniences.
Advance Products and its evidence and witnesses
are more conveniently located near the Northern District of
Indiana, while SFI and its documents and witnesses reside in the
Western District of Tennessee.
Because SFI bears the burden to
show that the Western District of Tennessee is the more appropriate forum in light of these factors, and has not demonstrated
that the Western District of Tennessee is more convenient for the
majority of parties and witnesses involved, the Motion to Trans-
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fer Venue to the Western District of Tennessee [DE 14] filed by
the defendant, SFI of Tennessee, LLC, on June 8, 2011, is DENIED.
ENTERED this 23rd day of August, 2011
s/ ANDREW P. RODOVICH
United States Magistrate Judge
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