HOLTEC INTERNATIONAL et al v. PANDJIRIS, INC. et al

Filing 21

OPINION FILED. Signed by Judge Renee Marie Bumb on 4/4/17. (js)

[Docket No. 17]
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
CAMDEN VICINAGE

HOLTEC INTERNATIONAL, et al.,
Plaintiffs,

Civil No. 17-666 (RMB/JS)
OPINION

v.
PANDJIRIS, INC., et al.,
Defendants.

APPEARANCES:
Matthew Benjamin Weisberg, Esq.
Weisberg Law
7 South Morton Avenue
Morton, PA 19070
Attorney for Plaintiffs Holtec International and
Holtec Manufacturing Division, Inc.
Louis Smith, Esq.
Greenberg Traurig, LLP
500 Campus Drive, Suite 400
P.O. Box 677
Florham Park, NJ 07932
Attorney for Defendant Pandjiris, Inc.
Thomas K. Richards, Esq.
Leader & Berkon LLP
630 Third Avenue
New York, NY 10017
Attorney for Defendant Arc Machines, Inc.
BUMB, UNITED STATES DISTRICT JUDGE:
This matter comes before the Court upon its Order to Show
Cause as to why this matter should not be transferred to the

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United States District Court for the Western District of
Pennsylvania [Docket No. 17].
On January 20, 2017, Plaintiffs Holtec International and
Holtec Manufacturing Division, Inc. (“Plaintiffs” or “Holtec”)
filed the instant action against Defendants Pandjiris, Inc.
(“Pandjiris”) and Arc Machines, Inc. (“AMI” and, together with
Pandjiris, the “Defendants”) [Docket No. 1].

Subsequently,

Defendants submitted pre-motion letters, in accordance with this
Court’s Individual Rules and Procedures, in which Defendants set
forth their intentions to file motions to dismiss on the basis
of lack of personal jurisdiction, improper venue, and an
arbitration clause [Docket Nos. 14, 15].

In light of

Plaintiffs’ allegations and Defendants’ representations in their
respective letters to the Court, on March 20, 2017, the Court
gave the parties notice and issued an Order to Show Cause,
directing the parties to address, inter alia, whether this
action should be transferred to the United States District Court
for the Western District of Pennsylvania pursuant to 28 U.S.C.
§ 1404(a) [Docket No. 17].

The Court has reviewed the parties’

responses to the Order to Show Cause and notes that Defendants
do not oppose transfer to the Western District of Pennsylvania
[Docket Nos. 19, 20].

Plaintiffs’ submission is not responsive

to the question of transfer [Docket No. 18].

For the reasons

set forth herein, the Court will transfer this action.

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I.

BACKGROUND
Plaintiffs Holtec International and Holtec Manufacturing

Division, Inc., New Jersey and Pennsylvania citizens
respectively, brought this action against Defendant Pandjiris, a
Missouri citizen, and Defendant AMI, a California citizen,
setting forth three counts: “Breach of Contract/Quasi-Contact/
Unjust Enrichment/Promissory Estoppel” (Count I); Third-Party
Beneficiary (Count II); and “U.C.C.” (Count III).
Around June 2012, Plaintiffs purchased two welding
manipulators from Pandjiris for approximately $709,260.00, which
were to be installed at Holtec’s manufacturing facility in
Turtle Creek, Pennsylvania.

Compl. ¶ 8 [Docket No. 1].

The

terms of the purchase included a warranty that the manipulators
would be free from defects for a period of 12 months or 2,000
hours of operation.

Compl. ¶ 10.

Thereafter, Pandjiris ordered

the equipment through a subcontractor, AMI.

Compl. ¶ 11.

Around January 2013, Pandjiris shipped the manipulators to
Holtec’s Turtle Creek facility, where they were installed.
Plaintiffs allege that Defendants supervised “the installation
and provided technical assistance.”

Compl. ¶ 12.

According to

the Complaint, “Holtec experienced continuous problems with the
welding manipulators causing months of delays – and severe
financial cost to Holtec.”

Compl. ¶ 13.

Plaintiffs claim that

Defendants were unable to properly identify or fix the problems

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with the equipment.

Compl. ¶ 16.

The Complaint alleges that

AMI sent Holtec a price quote for the repairs “because AMI
contended the damage was no longer under warranty” and that
Holtec then demanded a refund on the purchase price of the
manipulators.

Compl. ¶¶ 18-19.

After failed discussions with

Defendants, Plaintiffs filed the instant action seeking to
recover for damages allegedly caused by Defendants’ failure to
refund and/or repair the manipulators, “including the purchase
price of about $709,260.00 for the manipulators which never
operated properly, approximately $120,000 in labor expenses,
loss of production, and about $780,000 to replace the faulty
equipment.”
II.

Compl. ¶ 24 (emphasis in original).

LEGAL ANALYSIS
Section 1404(a) of Title 28 of the United States Code

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.”

The parties do not appear to genuinely dispute

that this action could have been filed in the Western District
of Pennsylvania, where the operative facts underlying the claims
occurred, where the equipment in question is located, where the
contracts at issue were performed, and where Plaintiffs have a
manufacturing facility.

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“If the proposed alternative forum is appropriate,” as it
is here, “it is then within the Court’s discretion to transfer
the action.”

Taylor v. Global Credit & Collection Corp., 2010

WL 2521758, at *1 (D.N.J. June 14, 2010) (citing Jumara v. State
Farm Ins. Co., 55 F.3d 873, 883 (3d Cir. 1995)).

Indeed,

“Section 1404(a) is intended to place discretion in the district
court to adjudicate motions for transfer according to an
‘individualized, case-by-case consideration of convenience and
fairness.’”

Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29

(1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622 (1964)).
“A determination that transfer to another jurisdiction is
appropriate represents an ‘exercise . . . of structured
discretion by trial judges appraising the practical
inconveniences posed to the litigants and the court should a
particular action be litigated in one forum rather than
another.’”

Lawrence v. Xerox Corp., 56 F. Supp. 2d 442, 450

(D.N.J. 1999) (quoting Ricoh Co. v. Honeywell, Inc., 817
F. Supp. 473, 479 (D.N.J. 1993) (quoting Liny v. E.I. Du Pont de
Nemours & Co., 886 F.2d 628, 632 (3d Cir. 1989))).

Thus, the

district court “is vested with a large discretion” to determine
when transfer should be ordered “for the convenience of parties
and witnesses, in the interest of justice,” pursuant to
Section 1404(a).

Solomon v. Continental Am. Life Ins. Co., 472

F.2d 1043, 1045 (3d Cir. 1973).

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In deciding whether to transfer an action under
Section 1404(a), courts in the Third Circuit consider both
private and public interests, as delineated in Jumara v. State
Farm Insurance, 55 F.3d 873, 880 (3d Cir. 1995).

The private

interest factors include:
1) the plaintiff’s forum preference; 2) the defendant’s
forum preference; 3) where the claim arose; 4) the
convenience of the parties as indicated by their
relative physical and financial condition; 5) the
convenience of the witnesses, but only to the extent
they may be unavailable for trial in one of the fora;
and 6) the location of books and records (similarly to
the extent that they could not be produced in the
alternative forum).
Id. at 879 (internal citations omitted).
Additionally, the relevant public interest factors include:
1) the enforceability of the judgment; 2) practical
considerations that could make the trial easy,
expeditious,
or
inexpensive;
3)
the
relative
administrative difficulty in the two fora resulting from
court congestion; 4) the local interest in deciding
local controversies at home; 5) the public policies of
the fora; and 6) the familiarity of the trial judge with
the applicable state law in diversity cases.
Id. at 879-80.

The Court addresses these factors below.

A. Private Interest Factors
With regard to the private interest factors, it is clear
that Plaintiffs prefer New Jersey.

Defendants, on the other

hand, do not oppose transfer to Pennsylvania.

Defendants do,

however, vehemently oppose Plaintiffs’ selected forum and argue
that this Court does not have personal jurisdiction over them.

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Generally, a plaintiff’s choice of forum is “a paramount
consideration” to transfer determinations, Shutte v. Armco Steel
Corp., 431 F.2d 22, 25 (3d Cir. 1970), and “should not be
lightly disturbed.”

Jumara, 55 F.3d at 879.

Here, however,

Plaintiffs’ choice of forum warrants less deference because
most, if not all, of the operative facts occurred in
Pennsylvania, not in New Jersey, as discussed below.

See, e.g.,

Goldstein v. MGM Grand Hotel & Casino, 2015 WL 9918414, at *2
(D.N.J. Nov. 5, 2015) (“the plaintiff’s choice of forum is
discounted significantly where ‘the case has little connection
with the chosen forum,’ and the nucleus of operative facts
occurred elsewhere.”) (quoting Job Haines Home for the Aged v.
Young, 936 F. Supp. 223, 227-28 (D.N.J. 1996)); Newcomb v.
Daniels, Saltz, Mongeluzzi & Barrett, Ltd., 847 F. Supp. 1244,
1246 (D.N.J. 1994) (“courts assign the plaintiff’s choice of
forum significant weight unless the case has little connection
with the chosen forum.”) (citing Shutte, 431 F.2d at 25); Am.
Tel. & Tel. Co. v. MCI Commc’ns Corp., 736 F. Supp. 1294, 1306
(D.N.J. 1990) (“Where the operative facts of a lawsuit occur
outside the forum selected by the plaintiff, that choice is
entitled to less deference.”) (internal citations omitted).
The parties do not dispute that Plaintiffs’ claims arose in
Pennsylvania.

Indeed, Plaintiffs’ Complaint alleges that

Plaintiff Holtec Manufacturing Division, Inc. is a Pennsylvania

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corporation with its principal place of business in Turtle
Creek, Pennsylvania, located near Pittsburgh, Pennsylvania.
Compl. ¶ 2.

The Complaint also states that the operative facts

giving rise to Plaintiffs’ claims occurred in Turtle Creek,
Pennsylvania.

For example, the manipulators subject to the

parties’ contract were shipped to and installed by Defendants in
Holtec’s facility in Turtle Creek.

Compl. ¶¶ 9, 12.

The

various service repair trips also took place at Holtec’s Turtle
Creek facility in Pennsylvania.

Compl. ¶¶ 15-20.

Moreover, Plaintiffs do not genuinely dispute that their
claims arose in Pennsylvania, not New Jersey.

Rather,

Plaintiffs sole basis for jurisdiction in this District is a
tortured and, in this Court’s view, incorrect interpretation of
the forum selection clause in Holtec’s Terms and Conditions.
See Pls. Pre-Motion Letter [Docket No. 16]; Pls. OSC Resp.
[Docket No. 18]; Holtec Terms and Conditions ¶ 38 [Docket
No. 1-3].1

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The Court has reviewed the Complaint, the parties’

Paragraph 38 of Holtec’s Terms and Conditions states:

APPLICABLE LAW: The AGREEMENT shall be governed by, and
construed and enforced in accordance with, the laws of
the State of New Jersey.
Any legal claim, suit,
proceeding, or action brought against the BUYER [defined
by the Terms and Conditions as “HOLTEC INTERNATIONAL”]
arising out of, connected with, or related to this
AGREEMENT shall be brought in the Superior Court of New
Jersey, Burlington County Vicinage, or in the United
States District Court for the District of New Jersey (if
the action is brought in federal court), which courts
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submissions, and the relevant documents in the record, including
Holtec’s Terms and Conditions, and finds that this factor--where
the events and claims occurred--weighs strongly in favor of
transfer.
The convenience of the parties is neutral.

Defendants may

have to travel substantial distances regardless of whether this
case remains in this District or is transferred to the Western
District of Pennsylvania, as Pandjiris is a Missouri corporation
with its principal place of business in Missouri and AMI is a
California corporation with its principal place of business in
California.

Compl. ¶¶ 3-4.

Significantly, transfer to the

Western District of Pennsylvania should not inconvenience
Plaintiffs as Plaintiff Holtec Manufacturing Division, Inc. is a
Pennsylvania corporation with its principal place of business in
Turtle Creek, Pennsylvania.

Compl. ¶ 2.

Accordingly, the Court

finds that the two Districts are equally convenient for the
parties.

are intended to be the exclusive forums for the
resolution of any such action against BUYER.
Both
parties consent to the personal jurisdiction of the
courts of the State of New Jersey and agree to waive the
right to trial by jury.
Compl. Ex. B ¶ 38 [Docket No. 1-3] (emphasis added). Plaintiffs
urge the Court to read the first and third sentences of this
clause in isolation and without reference to the remainder of
the clause which clearly limits the provision to actions brought
against Holtec, not actions, such as this one, initiated by
Holtec. The Court will not do so.
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The parties have not identified any witnesses that would be
unavailable for trial in either New Jersey or Pennsylvania.
Additionally, the parties have not identified any books and
records that would be relevant to the prosecution of this action
and they have not argued that any such document would be
unavailable in either District.

The Court notes, however, that

the equipment which is the subject of the parties’ dispute is
located at Holtec’s Turtle Creek facility in Pennsylvania.

As a

result, this factor weighs in favor of transfer to Pennsylvania.
B. Public Interest Factors
As to the public interest factors, the Court first
considers the enforceability of any judgment against Defendants.
A judgment against Defendants would likely be routine in
Pennsylvania, where Defendants allegedly performed the contracts
at issue and where the equipment in question is located.

A

judgment against Defendants in this District, however, may prove
more difficult to enforce given that Defendants have vigorously
contended that they are not subject to personal jurisdiction in
New Jersey.

Without making any findings, having reviewed the

allegations in the Complaint, the Court observes that the United
States District Court for the Western District of Pennsylvania
likely has personal jurisdiction over Defendants.
this factor weighs somewhat in favor of transfer.

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Accordingly,

In addition, the practical considerations weigh in favor of
transfer.

Defendants have contested the issue of personal

jurisdiction and proper venue before this Court and intend to
file motions to dismiss in the event the Court does not transfer
the case to the Western District of Pennsylvania.

While

Defendants may still file motions to dismiss in the Western
District of Pennsylvania, the issues raised would certainly by
streamlined by transfer.

For example, Defendants’ concerns

regarding improper venue would be resolved upon transfer to the
Western District of Pennsylvania.

See 28 U.S.C. § 1391(b)(2)

(“A civil action may be brought in . . . a judicial district in
which a substantial part of the events or omissions giving rise
to the claim occurred, or a substantial part of property that is
the subject of the action is situated.”).

Accordingly, as the

case will be able to proceed more expeditiously if it is
transferred, this factor weighs in favor of transfer to the
Western District of Pennsylvania.
The parties have not submitted any statistics or made any
arguments regarding the relative administrative difficulty in
the two fora resulting from court congestion.

While this Court

is available to afford the parties their day in court as
expeditiously as possible, the Court nonetheless notes that,
according to the Federal Court Management Statistics Profile for
the District of New Jersey, the median time from filing to

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disposition of civil matters is 8.0 months and the median time
from filing to trial in civil matters is 38.8 months, as of
December 31, 2016.2

According to the same source, in the Western

District of Pennsylvania, the median time from filing to
disposition of civil matters is 6.3 months and the median time
from filing to trial in civil matters is 33.3 months, as of
December 31, 2016.

Thus, this factor weighs in favor of

transfer to the Western District of Pennsylvania.
The Court also considers the local interest in deciding
local controversies at home.

The only connection this matter

has to this District is that one of the Plaintiffs is a New
Jersey citizen.

The alleged conduct underlying Plaintiffs’

claims, the performance of the contracts at issue, and the
manipulators in question are rooted in Pennsylvania.

Clearly,

Pennsylvania has a strong interest in regulating the conduct of
companies contracting and operating within its borders.

As this

matter revolves largely around interests based in Pennsylvania,
the Court finds that Pennsylvania has a greater interest in
deciding this dispute.

This factor weighs in favor of transfer.

The parties have not provided the Court with arguments
regarding the public policies of either fora.

2

As the Court sees

The Federal Court Management Statistics Profiles as of
December 31, 2016 are available on the United States Courts’
website: http://www.uscourts.gov/statistics/table/na/federalcourt-management-statistics/2016/12/31-1.
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no reason why the relevant public policies of this District or
the Western District of Pennsylvania would differ as to this
matter, the Court considers this factor neutral.

Finally, the

Court considers the familiarity of the trial judge with the
applicable state law in diversity cases to be a neutral factor.
Federal courts are generally well-equipped to apply the laws of
other states and frequently do so in diversity cases.
III.

CONCLUSION
In sum, the private and public factors weigh in favor of

transfer.

Thus, on balance, the Court finds it appropriate to

transfer this action to the United States District Court for the
Western District of Pennsylvania, pursuant to 28 U.S.C.
§ 1404(a).3

An appropriate Order shall issue on this date.
s/Renée Marie Bumb
RENÉE MARIE BUMB
UNITED STATES DISTRICT JUDGE

Dated: April 4, 2017

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Defendants have requested that this Court provide them
with sufficient time to file their respective responses to the
Complaint in its transfer order. The Court will not set further
deadlines in this matter given that the case will be transferred
to another District Judge who is entitled to manage his or her
docket as he or she sees fit. Counsel may wish to renew their
requests for additional time to file their responsive pleadings
before the District Judge assigned to the matter in the Western
District of Pennsylvania. Nevertheless, the Court notes that,
pursuant to its Individual Rules and Procedures I.A., the time
within which Defendants must file a responsive pleading was
tolled upon the filing of the pre-motion letters through the
date of the entry of this Opinion and the accompanying Order.
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