March VII Investment Limited Partnership et al v. Kramer

Filing 38

Judge Mark L. Wolf: ORDER entered. MEMORANDUM AND ORDER: Case hereby transferred to the United States District Court for the District of Maryland.(Franklin, Yvonne)

UNITED STATES

DISTRICT COURT

DISTRICT OF MASSACHUSETTS
MARCH VII

INVESTMENT

PARTNERSHIP
INVESTMENT

LIMITED

and MARCH VIII
LIMITED

PARTNERSHIP

Plaintiffs

C.A.

V.

ANNE E.

No.

15-11917-MLW

KRAMER,

Defendant
MEMORANDUM AND ORDER

WOLF,
I.

September 14, 2016

D.J.

SUMMARY

Plaintiffs

are

Massachusetts law,

two

limited partnerships

established under

March VII Investment Limited Partnership and

March VIII Investment Limited Partnership (the "March Entities").

The March Entities are the limited partners in two Maryland limited

partnerships that own two senior living facilities in Maryland,
the Ridgely/Hampstead Limited Partnership and the Ridgely Black
Rock Limited Partnership (the "Partnerships").
have

sued

defendant

Partnerships,

Anne

alleging

Kramer,

that

the

Kramer

The March Entities

general

breached

partner

the

of

the

agreements

governing the Partnerships (the "Partnership Agreements") and her
fiduciary duties as general partner.
Kramer has moved to transfer this case to the United States

Court

for

Plaintiffs

the

District

oppose

of

Maryland

transfer.

For the
1

(the

"Transfer

reasons

Motion").

explained in the

Memorandum, the Transfer Motion is being allowed.

In essence, the

presumption in favor of the plaintiffs' choice of forum is weak in
this case.

It is outweighed by the convenience of the parties,

the convenience of the witnesses,

and the interests of justice,

which all favor litigating and trying this action in the District
of Maryland.
II.

PROCEDURAL HISTORY

On June 19, 2015, Kramer filed a motion to dismiss, arguing
that this court lacks personal jurisdiction over Kramer or, in the
alternative,

the case should be dismissed under the doctrine of

forum non conviens.

The March Entities opposed that motion.

The

court held a hearing on the motion and raised the question of
whether the case should be transferred to the District of Maryland

pursuant to 28 U.S.C. §1404.

The court subsequently issued an

order denying the motion to dismiss, ordering the parties to confer

and report whether they agreed to transfer the case to the District
of Maryland, and establishing a schedule for Kramer to file any
motion to transfer if the parties did not agree.

Transfer

Motion

Memorandum")

with

a

supporting

and three affidavits.

memorandum

Kramer filed the

(the

"Transfer

The March Entities filed an

opposition ("Transfer 0pp.") and supporting declaration.
III.

APPLICABLE

STANDARDS

"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 or to

any district or division to which all parties have consented."

28

U.S.C. §1404(a). "The burden of proof rests with the party seeking
transfer." Coady v.

Ashcraft & Gerel,

223 F.Sd 1,

11

(1st Cir.

2000).

Ordinarily,

"there is a 'strong presumption in favor of the

plaintiff's choice of forum.'" Astro-Med,
Am., Inc., 591 F.Sd 1, 13 (1st Cir. 2009)

Inc.

v.

Nihon Kohden

(quoting Coady, 223 F.Sd

at 11). However, "[w]here the operative facts of the case have no
material

forum

connection

carries

less

with

[the]

weight."

district,

U.S.

ex

plaintiff's

rel.

Ondis

choice

v.

of

City

of

Woonsocket, Rhode Island, 480 F. Supp. 2d 434, 436 (D. Mass. 2007)

(quoting Goodman v. Schmalz, 80 F.R.D. 296, 302 (E.D.N.Y. 1978)).
More specifically:

[T]he plaintiff's venue choice is to be given less weight
if he or she selects a

district court with no obvious

connection to the case or the plaintiff is a nonresident
of the chosen forum or neither element points to that

court. Although not universally followed by other
courts,
this approach is one of sound judicial
administration and reflects good common sense.

Id.

(quoting 15 Wright,

Procedure §3848 at 134-39

A district

court

Miller & Cooper,

Federal Practice and

(2007)) .

considering

a

motion

for

transfer

"must

evaluate both the convenience of the parties and various publicinterest

considerations."

Atl.

Marine

Const.

Co.

v.

U.S.

Dist.

Court for W. Dist. of Texas, 134 S. Ct. 568, 581 (2013). In weighing

convenience, the court must consider both the "convenience of the

parties and the witnesses." 28 U.S.C. §1404(a).

"Judges in this

District agree that convenience of the witnesses is an extremely

important,

if not the most important,

factor to be analyzed in

determining whether to change a litigation's venue." Gemini Inv'rs
Inc. V. Ameripark, Inc., 542 F. Supp. 2d 119, 126 (D. Mass. 2008)

(citing Brant Point Corp. v. Poetzsch, 671 F. Supp. 2, 3 (D. Mass.
1987)) .

To

demonstrate

inconvenience,

the

movant

must

(1)

identify the witnesses and their locations; (2) indicate
the quality or materiality of the[ir] testimony; and (3)
show[] that any such witnesses were unwilling to come to
trial . . . [,] that deposition testimony would be
unsatisfactory[,] or that the use of compulsory process
would be necessary.

Employers Mut. Cas. Co.
1169

(10th Cir.

2010)

v.

Bartile Roofs,

Inc.,

618 F.3d 1153,

(internal quotations omitted).

The court

must also consider "relative ease of access to sources of proof;

availability of compulsory process . . .; possibility of view of

premises . . .; and all other practical problems that make trial
of a case easy, expeditious and inexpensive." Atl. Marine, 134 S.
Ct. at 581 n.6 (internal quotation mark omitted).

"The

'interest

of

justice'

is

a

separate

element

of

the

transfer analysis that relates to the efficient administration of
the

court

Bridqeport

system."
Intern.,

Research
Inc.,

626

Automation,
F.3d

973,

Inc.
978

v.

Schrader-

(7th Cir.

2010).

Factors that courts consider in determining whether transfer is in

the interest of justice include: (1) the time it will take to reach
trial

with

in each district;

the

relevant

(2)

law;"

(3)

"each court's

"the

relative

respective

familiarity

desirability

of

resolving controversies in each locale;" and (4) "the relationship
of each community to the controversy." Id.; see also Brant Point,
671 F. Supp. at 5 ("[T]ransfer . .

. would promote the interests

of justice by allowing the North Carolina zoning procedures at
issue in this case to be construed by a federal court sitting in
that state, rather than by a court unfamiliar with North Carolina
law.").
IV.

FACTS

The

March

Entities

contend

that

Kramer

has

breached

the

Partnership Agreements in a variety of ways since 2000, including
by: (1) failing to pay a required fee; (2) failing to pay the March
Entities

paying

their

annual

herself

Partnerships'

share

unauthorized

of

the

Partnerships'

compensation;

(3)

changing

(4)

profits;

the

accountants without the March Entities'

approval;

and (5) attempting to admit another entity, the Hampstead Group,

LLC,

as

approval.
the

a

second

general

partner without

the

March

Entities'

The Complaint makes four claims for relief flowing from

alleged

breaches:

(1)

declaratory

judgment

that

Kramer

breached the Partnership Agreements, entitling the March Entities
to remove her as general partner;

(2)

breach of the Partnership

Agreements;

(3)

breach

of

fiduciary

duty;

and

(4)

unjust

enrichment.

The

following

otherwise

facts

indicated.

are

Kramer

drawn
is

a

from

the

resident

complaint

of

unless

Maryland.

The

Partnerships were established in the 1980s to develop and operate
two

rental

communities

"Properties").

in Maryland for

low-income seniors

(the

The Partnership Agreements provide that they are

governed by Maryland law.

At the time the Partnership Agreements were negotiated, the

March Entities' operated from Boston, Massachusetts.
Affidavit in Opposition to Motion to Dismiss 53.

See Madrigal
In 1992, the

March Entities moved their offices out of Massachusetts.

See id.

In

to

2005,

the

March

Entities

moved

all

files

related

the

Partnerships to California, where the March Entities' offices are
now located.

See id.

52.

The March Entities are now controlled

by their general partner—another limited partnership based in
California, NPI Capital Associates, L.P
Declaration

in

Opposition

("Orenstein Dec.")

to

("NPI").

Defendant's

Motion

Orenstein
to

Transfer

55.

The parties have each submitted declarations concerning the
Transfer Motion.

Kramer submitted three:

Anne

the

Kramer;

(2)

the Declaration of

Declaration of Mario Nimock;

Declaration of Richard Lasley.

See Lasley Dec. 58.

(1)

and

(3)

the

Kramer lives in Parkton, Maryland.

She handles all of her "business activities

personally."

Id. SIS; see also Kramer S12.

She is 90 years-old and

requires "round-the-clock helpers" to assist her.
SIS; Kramer SI2.

See Lasley Dec.

Kramer states that traveling to Massachusetts would

be "a great burden .

.

age and limitations."

. personally and physically, given [her]

Kramer Dec. SI2.

Massachusetts for depositions or trial,

If Kramer must travel to
the helpers will have to

travel with her, and Kramer would need to find and pay for suitable
accommodations for them.

See Lasley Dec. SIS; Kramer SI2.

The Lasley Declaration identifies eleven Maryland witnesses,
including Lasley himself, that Kramer contends are "necessary to

[her] defense in this case . . . "

Lasley Dec. SI7.

Lasley lives

in Maryland and is Kramer's "estate planning counsel and personal

general

counsel"

potentially

and

relevant

has

personal

matters,

knowledge

including:

about

the

various

Partnership

Agreements; Lesley's conversations with agents of NPI concerning
the "payment of service fees and other sums"; and the addition of
the Hampstead Group, LLC as a general partner in the Partnerships.
See id. 5SI5-6.

In particular, Lasley states that he spoke with

NPI representatives about their demands for payment and was never

"provided

with

satisfactory

information

for

me

payments under the subject partnership agreements."

to

recommend

Id. SI9.

Lasley also asserts that Richard Lehman is an attorney who
has represented Kramer for many years and is located in Maryland.
He can testify concerning communications with the March Entities

or their agents "concerning the admission of Hampstead Group, LLC

as an additional general partner."

Id. ^7.

Lasley adds, without

elaboration, that Lehman can also testify about his firms' records

relating to the

Partnerships,

Kramer's defenses.

the March Entities'

claims,

and

See id.

In addition, Lasely states that two current and two former

accountants for the Partnerships, who are in Maryland, can testify

concerning

the

Partnerships'

Partnerships'

audit

finances,

reports,

and

the

details

creation

of

the

of

the

fees

and

distributions that the March Entities claim were paid or not paid.

See id.

Bruce Campbell, an officer with the Partnerships' property

manager in Maryland, Wallace H. Campbel & Co., Inc., can testify
about the management duties and payment of service fees, as well
as, conversations he has had with agents of NPI.

See id.

Linda

Wood, the onsite property manager for the Properties, and Deborah
Carlson, the management supervisor, can testify about the regular

operations and management of the properties, rent increases sought
for

the

properties,

revenues

and

properties, and contacts with the USDA.

disbursements
See id.

from

the

Sandra S. Hunter,

the local USDA Rural Development representative in Maryland, has

knowledge of the "operations and management of the properties,
decisions

on

requests

for

rent

increases,

audited

financial

statements relating to the properties" and USDA contacts with
Kramer and property management personnel.

Id.

Finally, John W.

Beckley is a Maryland attorney who can testify about the "role of

the Hampstead Group with regard to the [Partnerships]."
The

Nimock

Affidavit,

submitted

by

Kramer,

See id.

describes

and

provides public documents detailing the creation, administrative
dissolution, and reinstatement of the March Entities.

Attached to

it are documents from the Massachusetts Secretary of State's Office

indicating

that

the

March

Entities

made

no

filings

Secretary from the fall of 1992 through May 20,
11SI8,

20.

with

2015.

the

See id.

The March Entities were administratively dissolved on

June 13, 2013.

See id. SIS19, 21.

They were both reinstated on May

22, 2015 after filing Annual Reports for the years 2008 through
2015.

See id. 1^11-12, 23-24.

The March Entities filed this suit

four days after they were reinstated.
The

March

Entities

submit

See id. SI25.

the

Orenstein

Declaration

in

opposition to the Transfer Motion.

Orenstein identifies three

categories

who

of

Massachusetts.
ultimate

Dec. IS.

relevant

witnesses

reside

in

or

near

Jack Manning is the individual with the greatest

financial

stake

in the March Entities.

See Orenstein

Manning holds a 67% limited partnership interest in an

entity called JP Two LP, which holds a 99% limited partnership
interest

in

the

March

Entities.

See

id.

financial stake in the March Entities and,

Entities,

He

has

the

largest

according to the March

is the most qualified individual to testify about the

materiality

of

Kramer's

alleged

breaches

of

the

Partnership

Agreements.

See id.

Manning lives and works in Massachusetts,

and is not an agent of the March Entities.

See id.

The second category of witnesses is comprised of the former

principals of the March Entities' original general partner.
id.

SI9.

Jerome

Heller

and

Peter

O'Connor

are

See

Massachusetts

residents and have "first-hand knowledge of the negotiation of the

[Partnership Agreements], the intent of the parties at the time
they entered into

[them] ,

and the conduct of the parties after

entering into the [Partnership Agreements]."

Id.

The final category of plaintiffs' witnesses consists of four
individuals who were original limited partners in one or the other
of the March Entities.

See id. 510.

materiality of Kramers'

They can testify about "the

breaches of contract based on

[their]

expectations at the time [they] made [the] investment as well as
[their]

purchase of limited partnership interests pursuant to a

securities offering in connection with the [Partnerships]."

Id.

Three of the individuals are residents of Massachusetts and one is

a resident of New Hampshire who lives within 100 miles of Boston.
See

id.

V.

DISCUSSION

Kramer

Maryland.

seeks

to

transfer

She argues that:

this

(1)

case

to

the

District

of

the convenience of the parties

favors transfer because Kramer is elderly and requires full-time

care;

(2) the most important witnesses all reside in Maryland; and
10

(3)

Maryland has

the

greatest

interest

in this

action because

Maryland law governs the dispute, and the dispute concerns Maryland
limited partnerships operating senior housing in Maryland.

The

March Entities respond that Kramer has not overcome the presumption
in favor of their choice of venue.

Massachusetts entities,

their home forum.
in

or

They argue further that,

as

they have an interest in litigating in

They also identify several witnesses who reside

near Massachusetts.

The presumption in favor of plaintiffs'

choice of venue is

relatively weak in this case because the March Entities now have
"no material connection with this district."

2d

at

436.

The

Massachusetts,

March

despite

Entities

are

Ondis,

no

480 F.

longer

remaining Massachusetts

legal

Supp.

based

in

entities.

The presumption is not strengthened by the March Entities' choice
to bring this action in their home forum.
choice of home

forum

In the normal case, the

"more likely represents

considerations

of

convenience rather than vexation or harassment to the defendant."

See Kleinerman v. Luxtron Corp., 107 F. Supp. 2d 122, 125 (D. Mass.

2000).

Id.

undermines
for

The March Entities'

long absence from Massachusetts

the claim that Massachusetts

is much more

convenient

them.

In the usual case, the convenience of the parties is neutral
because

another.

transfer

merely

shifts

See Brant Point,

671 F.
11

the

burden

Supp. at 3.

from

one

However,

party

to

in this

case, the representatives of the March Entities will have to travel
from California either to Massachusetts or Maryland.^ Litigating
in

Massachusetts,

Kramer.

however,

would

be

particularly burdensome

to

She lives in Maryland, is 90 years old, and requires full-

time care-takers, with whom she would have to travel.

Often the most important factor in deciding whether transfer

is justified is the convenience of witnesses and the availability
of live testimony.

Here, the most important witnesses identified

by either party appear to be the Partnerships' accountants.
accountants can explain the complex financial
heart of the March Entities'

claims.

The

documents at the

See Transfer 0pp.

at 11-13

(stating they intend to rely at trial on audit reports produced by
the Partnerships' accountants).

"It is well settled that the trier

of fact should not be forced to rely on deposition evidence when

the deponent's live testimony can be procured [through transfer].
This

is

especially

so

when

witnesses' testimony is high."
(internal

citations

and

the

'qualitative

value'

of

the

Brant Point, 671 F. Supp. at 4-5

quotation

marks

omitted);

see

also

Kleinerman v. Luxtron Corp., 107 F. Supp. 2d 122, 125-26 (D. Mass.
2000)

("Section 1404(a)

of Title

28

also

requires

the

court

to

1 The March Entities argue that Manning, the individual with the
greatest financial interest in the case, is a Massachusetts
resident and important witness.
However, Manning is not a
party. Therefore, his location is not relevant to the
convenience of the parties factor.
12

consider the convenience of witnesses, with a preference of live

testimony over testimony by deposition.")'

The accountants are

located in Maryland and can, if necessary, be compelled to testify
in the District of Maryland.

See F.R.

Civ.

P.

cannot be compelled to testify in Massachusetts.

45(c) (1) .

They

In any event,

Maryland is more convenient for them.

It

is

not evident that the

testimony of any of the March

Entities' proposed witnesses would be admissible.

They argue that

their proposed witnesses can testify concerning the materiality of
the alleged breaches and the intent of the contracting parties.
However, "[t]he determination of the materiality of a breach must

be based largely on a standard of objective reasonableness, rather
than purely subjective belief."
(4th ed. 2016).

23 Williston on Contracts §63:3

The March Entities do not explain how testimony

from any of these witnesses would be more than subjective belief.
In

addition,

Maryland

follows

the

rule

that

extrinsic

evidence is only admissible to interpret a contract when the words
of the contract are ambiguous.

See Calomiris v.

Woods,

353 Md.

425, 437 (1999); Huggins v. Huqqins & Harrison, Inc., 220 Md. App.

405,

418

(2014).

The March Entities concede in their Opposition

that any relevance is conditioned on the court ruling that the

Agreements are ambiguous.
Partnerships are ambiguous.

However,

they do not argue that the

Rather, they assert that "extrinsic

13

evidence is unnecessary" to interpret the Partnership Agreements.
Transfer 0pp.

In

at 7.

addition,

the

March

Entities

have

admissible evidence that Manning may have.

not

identified

any

Nor have they argued

that Manning would be unwilling or unable to travel to Maryland
for trial if he were a

witness.

See Optos,

Sys., Inc., 111 F. Supp. 2d 217, 237
Texas Roadhouse,

Inc.

v.

Topcon Med.

{D. Mass. 2011); E.E.O.C. v.

Inc., No. 1:11-CV-11732-DJC, 2012 WL 5894910, at

2 (D. Mass. Nov. 9, 2012); F.A.I. Elecs. Corp. v. Chambers, 944 F.

Supp. 77, 80-81 (D. Mass. 1996).

Finally, the interests of justice weigh heavily in favor of
transfer to Maryland.

The case is still in its early stages,

transfer would not delay the time to get to trial.

so

If a jury view

of the properties would be valuable, it could occur if the trial
were in Maryland, but not if it were in Massachusetts.
.

would promote

the

interests

of

"[TJransfer

justice by allowing

the

[Maryland law] at issue in this case to be construed by a federal

court sitting in that state,
with [Maryland] law."
appropriate

that

these

rather than by a court unfamiliar

Brant Point, 671 F. Supp. at 5.
issues

be

decided by

a

It is most

Maryland court,

subject to appeals and authoritative decisions in the appellate
courts

familiar

with

Maryland

law.

stronger relationship with the dispute.

Finally,

Maryland

has

a

This case concerns two

Maryland Partnerships, application of Maryland law, and operation
14

of entities of significant public importance (public housing) in

Maryland.

Accordingly, the court concludes that transfer of this

case to the District of Maryland is justified.
VI.

ORDER

In view of the foregoing,
1.

it is hereby ORDERED that:

Plaintiff's Motion to Transfer Venue

(Docket No.

28)

is

This

the

States

ALLOWED.

2.

case

shall

be

TRANSFERRED

to

United

District Court for the District of Maryland.

UNITED SPATES DISTRICT JUDGE

15