Shetterly v. Bienstock et al

Filing 8

ORDER granting 7 Motion to Transfer Case. Accordingly, the Clerk of Court is directed to TRANSFER this action to the United States District Court for the District of Delaware. The Clerk of Court is further directed to terminate all pending motions, adjourn all remaining dates, and close this case. SO ORDERED. (Signed by Judge Katherine Polk Failla on 8/29/2024) (sgz)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
RYNE SHETTERLY,
Plaintiff,
-v.LEE BIENSTOCK; MICHAEL BURDIEK;
ANTHONY CAPONE; STEVEN KATZ; VINA M.
LEITE; ANDRE OBERHOLZER; NORMAN
ROSENBERG; IRA SMEDRA; ELY D. TENDLER;
JAMES M. TRAVERS; and STAN VASHOVSKY,

24 Civ. 4155 (KPF)
ORDER

Defendants,
-andDOCGO INC.,
Nominal Defendant.
KATHERINE POLK FAILLA, District Judge:
On August 15, 2024, Plaintiff Ryne Shetterly (“Plaintiff”) filed a motion
seeking to transfer this case to the United States District Court for the District
of Delaware pursuant to 28 U.S.C. § 1406(a). (See Dkt. #7). While Defendants
have yet to appear in this action, Plaintiff’s motion states that counsel for the
parties have conferred, and Defendants do not oppose the motion to transfer.
For the reasons that follow, the Court grants Plaintiff’s motion and transfers
this action to the United States District Court for the District of Delaware.
DISCUSSION
Plaintiff claims that there were “compelling reasons” to bring this action
in the Southern District of New York, including the facts that: (i) DocGo, Inc.’s
(“DocGo”) principal place of business is located within this District; (ii) the

allegations concern a contract awarded by the City of New York; and (iii) a
related action is pending in this District. (Dkt. #7 at 2). However, DocGo’s
Certificate of Incorporation contains a mandatory forum selection clause,
which provides:
[T]he sole and exclusive forum for any complaint
asserting any internal corporate claims … , to the fullest
extent permitted by law, and subject to applicable
jurisdictional requirements, shall be the Court of
Chancery of the State of Delaware (or, if the Court of
Chancery does not have, or declines to accept,
jurisdiction, another state court or a federal court
located within the State of Delaware).
(Id. ¶ 3). According to Plaintiff, counsel for DocGo has represented that DocGo
is unwilling to waive the enforcement of this provision. (Id. ¶ 4)
Generally speaking, two federal statutes — 28 U.S.C. §§ 1404(a) and
1406(a) — govern motions to transfer venue. Both allow a federal district court
to transfer a case to another federal district court, so long as the transferee
court is one in which the action could have initially been brought. See
Wohlbach v. Ziadhy, No. 17 Civ. 5790 (ER), 2018 WL 3611928, at *3 (S.D.N.Y.
July 27, 2018). However, which of the two statutes applies depends on the
particular circumstances of the case.
Because Plaintiff’s motion to transfer in this action rests in large part on
the inclusion of a forum selection clause in DocGo’s Certificate of
Incorporation, the motion should be evaluated under Section 1404(a), as
opposed to Section 1406(a). “A forum selection clause cannot render otherwise
proper venue in a court ‘wrong’ or ‘improper’ within the meaning of § 1406(a),
but such a clause may be enforced through a motion to transfer under
2

§ 1404(a).” Crede CG III, Ltd. v. 22nd Century Grp., Inc., No. 16 Civ. 3103
(KPF), 2017 WL 280818, at *8 (S.D.N.Y. Jan. 20, 2017) (quoting Atl. Marine
Const. Co. v. U.S. Dist. Ct. for W. Dist. of Texas, 571 U.S. 49, 59 (2013)) (internal
quotation marks omitted). It is Section 1404(a) that thus “provides [the]
mechanism for enforcement of forum selection clauses” that “point to a
particular federal district.” Id. Accordingly, even though Plaintiff’s motion was
made pursuant to Section 1406(a), the Court will evaluate it under the
appropriate standard provided by Section 1404(a).
Under Section 1404(a), “[f]or the convenience of parties and witnesses,
in the interest of justice, a district court may transfer any civil action to any
other district … where it might have been brought.” 28 U.S.C. § 1404(a).
However, “the presence of a valid forum-selection clause requires district
courts to adjust their usual [Section] 1404(a) analysis,” because “[w]hen parties
agree to a forum-selection clause, they waive the right to challenge the
preselected forum as inconvenient or less convenient for themselves or their
witnesses, or for their pursuit of the litigation.” Sadiant, Inc. v. Penstock
Consulting, LLC, No. 23 Civ. 7872 (KPF), 2024 WL 2847195, at *13 (S.D.N.Y.
May 30, 2024) (citations omitted). When reviewing a motion to transfer that
implicates a forum selection clause, the court “[need] not consider arguments
about the parties’ private interests, and may consider arguments about publicinterest factors only.” Id. (quoting Atl. Marine, 571 U.S. at 64) (internal
quotation marks omitted). Moreover, the party acting in violation of the forum
selection clause “bear[s] the burden of showing that the public-interest factors
3

overwhelmingly disfavor” litigating in the forum designated in the forum
selection clause because “enforcement would be unreasonable or unjust.” Id.
(citations omitted).
Here, neither party attempts to argue that enforcement of the forum
selection clause is unreasonable or unjust, such that the public factors
overwhelmingly disfavor proceeding in the District of Delaware. While
Defendants have yet to appear in this action, the Court accept Plaintiff’s
counsel’s representation that Defendants do not oppose the motion to transfer.
(Dkt. #7 at 3 n.2). Furthermore, the Court does not believe that litigating in
the District of Delaware would present an inconvenience for either party. While
there is a related litigation pending in this District, the Court does not find that
this related case, alone, presents “exceptional” circumstances such that a valid
forum selection clause should not be given “controlling weight.” Atl. Marine,
571 U.S. at 580. The Court also recognizes that Plaintiff’s complaint is a
stockholder derivative action, alleging various causes of action that the Court
believes its sister court in the District of Delaware would be familiar with and
well-equipped to handle. As a whole, therefore, the Court finds the totality of
the circumstances and the interest of justice favor transfer.
CONCLUSION
Accordingly, the Clerk of Court is directed to TRANSFER this action to
the United States District Court for the District of Delaware. The Clerk of
Court is further directed to terminate all pending motions, adjourn all
remaining dates, and close this case.
4

SO ORDERED.
Dated: August 29, 2024
New York, New York
KATHERINE POLK FAILLA
United States District Judge

5