Proud Veterans, LLC v. Ari Ben-Menashe et al

Filing 43

MEMORANDUM AND ORDER denying 39 Motion to Transfer Case; granting 41 Motion to Withdraw as Attorney. It is further ordered that this case shall be dismissed without prejudice. Signed by District Judge Julie A. Robinson on 04/02/14. (hs)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

PROUD VETERANS, LLC,
Plaintiff,
v.
ARI BEN-MENASHE, et al.,
Defendants.

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Case No. 12-CV-1126-JAR

MEMORANDUM AND ORDER
This matter is before the Court on Plaintiff’s Motion to Transfer Case (Doc. 39) and the
Motion to Withdraw filed by Plaintiff’s counsel (Doc. 41). On February 27, 2014, the Court
entered its Memorandum and Order granting Defendants’ Motion to Dismiss for lack of personal
jurisdiction,1 but the Court delayed dismissal of this action to allow the parties to address
whether transfer of the case would be in the interest of justice. For the reasons set forth below,
the Court finds that transfer is not warranted in this case and denies the Motion to Transfer.
Plaintiff has now filed a motion to transfer the case pursuant to 28 U.S.C. § 1631 to the
United States District Court for the Southern District of New York, claiming that the action
could have been brought there originally. 28 U.S.C. § 1631 provides that when “a court finds
that there is a want of jurisdiction, the court shall, if it is in the interest of justice, transfer such
action . . . to any other such court in which the action . . . could have been brought at the time it

1

Doc. 38.

was filed.”2
The transferor court must “first satisfy itself that the proposed transferee court has
personal jurisdiction over the parties.”3 “If so, even though “§ 1631 contain[s] the word ‘shall,’ .
. . the phrase ‘if it is in the interest of justice’. . . grant[s] the [transferor] court discretion in
making a decision to transfer an action or instead to dismiss the action without prejudice.”4 The
factors the Court should consider in determining whether transfer would be in the interest of
justice include “whether the claims would be time barred if filed anew in the proper forum,
whether the claims were filed in good faith or if . . . it was clear at the time of filing that the court
lacked the requisite jurisdiction.”5
Plaintiff claims that the action could have been originally brought in the United States
District Court for the Southern District of New York. Plaintiff bears the burden to establish that
the proposed transferee court—here the United States District Court for the Southern District of
New York—would have personal jurisdiction over the Defendants.6 In support of this argument,
Plaintiff alleges that Defendant Traeger Resources and Defendant Dickens & Madson are both
incorporated in New York, and that Defendant Ben-Menashe owns real estate in New York.
However, Defendants allege that Defendant Ovsjannikovs is a stateless Russian Latvian living in

2

28 U.S.C. § 1631.

3

Grynberg v. Ivanhoe Energy, Inc., 490 F. App’x 86, 105 (10th Cir. 2012) (citing Viernow v. Euripides
Dev. Corp., 157 F.3d 785, 793 n.16 (10th Cir. 1998)).
4

Id. (citing In re Cline, 531 F.3d 1249, 1251 (10th Cir. 2008)).

5

Id. (citations omitted).

6

Id. (citing Stanifer v. Brannan, 564 F.3d 455, 459 n.1 (6th Cir. 2009) (“[I]n the absence of the ability to
establish jurisdiction in the district in which the complaint was filed and faced with a motion to dismiss, it seems
clear that the plaintiff would have the burden of proving grounds for a transfer.”)).

2

Montreal, Canada; Andre Maritime is a Latvian company doing business in Canada; and that the
New York corporations (Traeger Resources and Dickens & Madson) were not the entities
involved in the transactions that form the basis of Plaintiff’s claims, but rather the Canadian
entities by the same names. Defendants state that:
The New York corporations, the New York Secretary of State’s
website shows, were formed as domestic New York corporations
in 2010. A similar search of the Quebec corporation registry
shows entities by the same names have existed as Canadian entities
since 2005. Consistent with Mr. Ovsjannikovs’ Declaration which
asserts that the Purchase and Sales Contract that is the basis of
plaintiff’s claim is with the Canadian company, that contract is
expressly governed by the laws of Canada. Similarly, the release
of Traeger Resources and Logistics and Dickens & Madson
Canada Inc. signed by the plaintiff did not identify those entities as
New York entities, but as being of “740 Notre Dame Quest,
Montreal, Quebec, Canada.” The alleged September 2011
settlement agreement is not with Traeger Resources and Logistics
of “New York” but rather of “Montreal, Quebec, Canada.”7
Plaintiff has not responded to Defendants’ allegations regarding personal jurisdiction
over the various Defendants. The Court finds that Plaintiff has failed to meet its burden of
showing that the proposed transferee court would have personal jurisdiction over the Defendants.
The Court is “hesitant to transfer the case to a court where the question of jurisdiction is not
clearly established.”8 Furthermore, Plaintiff has not shown that transfer would be in the interest
of justice. Plaintiff has not alleged that if this case is dismissed the statute of limitations would
bar refiling in a new venue. In fact, Defendants have alleged that the statute of limitations would

7

Doc. 40 at 4–5 (internal citations omitted).

8

Grynberg, 490 F. App’x at 106 (citing the district court opinion at Grynberg, 666 F. Supp. 2d at 1239, and
concluding the district court rightly declined to transfer the action because the plaintiffs failed to show that the
transferee court would have personal jurisdiction over the defendants).

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not bar a new action, citing N.Y. C.P.L.R. 213(2)(8) (2003).9 The Court finds that transfer is not
warranted in this case and the case should be dismissed without prejudice. Plaintiff’s counsel’s
motion to withdraw is granted.
IT IS THEREFORE ORDERED BY THE COURT that Plaintiff’s Motion to Transfer
Case (Doc. 39) is DENIED.
IT IS FURTHER ORDERED BY THE COURT that the Motion to Withdraw filed by
Plaintiff’s counsel (Doc. 41) is GRANTED.
IT IS FURTHER ORDERED BY THE COURT that this case shall be DISMISSED
WITHOUT PREJUDICE.
IT IS SO ORDERED.
Dated: April 2, 2014
S/ Julie A. Robinson
JULIE A. ROBINSON
UNITED STATES DISTRICT JUDGE

9
See N.Y. Limitations of Time § 213 (McKinney 2004). Section 213(2) and (8) provide for a six year
statute of limitations for actions upon a contractual obligation or liability and for actions based upon fraud.

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