Wiener v. AXA Equitable Life Insurance Company

Filing 27

ORDER denying 22 Objection to Magistrate Judge's Decision (Rule 72(a)) re 21 Order on Motion to Change Venue, Order on Motion to Strike ; denying as moot 24 Motion to Strike. Signed by District Judge Robert J. Conrad, Jr on 2/13/2019. (brl)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
3:18-cv-00106-RJC-DSC
MALCOLM WIENER,

)
)
Plaintiffs,
)
)
vs.
)
)
)
AXA EQUITABLE LIFE
)
INSURANCE COMPANY,
)
)
Defendant.
)
____________________________________ )

ORDER

THIS MATTER comes before the Court on AXA Equitable Life Insurance
Company’s (“Defendant”) Motion to Transfer Venue pursuant to 28 U.S.C. § 1404(a),
(Doc. No. 10); the Magistrate Judge’s Memorandum and Order (“M&O”), (Doc. No.
21), denying Defendant’s Motion to Transfer; and Defendant’s Objection to the M&O,
(Doc. No. 22).

Also before the Court is Defendant’s Motion to Strike Plaintiff’s

Opposition Brief to Defendant’s Objection to the M&O, or in the Alternative, for
Leave to File a Reply, (Doc. No. 24).
I.

BACKGROUND
Neither party has objected to the Magistrate Judge's statement of the factual

and procedural background of this case. Therefore, the Court adopts the facts as set
forth in the M&R.

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II.

LEGAL STANDARD
The district court has authority to assign non-dispositive pretrial matters

pending before the Court to a magistrate judge to “hear and determine.” 28 U.S.C.
§ 636(b)(1)(A). When reviewing an objection to a magistrate judge’s order on a nondispositive matter, the district court must set aside or modify any portion of that
order which is clearly erroneous or contrary to law. Id.; Fed. R. Civ. P. 72(a). An
order transferring a case to another district court is generally viewed as a nondispositive matter, and thus is reviewed under Rule 72(a). See Cadence Bank, N.A.
v. Horry Props., LLC, No. 2:09-cv-44, 2010 WL 4026392, at *2 n.4 (W.D.N.C. Oct.
13, 2010). A magistrate judge’s order is contrary to law if the judge failed to apply
or misapplied statutes, case law, or procedural rules. See Catskill Dev. LLC v. Park
Place Entm’t Corp., 206 F.R.D. 78, 86 (S.D.N.Y. 2002).
Today, the Court is tasked with evaluating the propriety of the Magistrate
Judge’s transfer decision as outlined in the M&O. This is a nondispositive order
which the Court will only set aside or modify if it is clearly erroneous or contrary to
law. See Powell v. Town of Sharpsburg, No. 4:06-cv-117, 2009 WL 863348, at *7
(E.D.N.C. Mar. 27, 2009) (holding that the critical issue is the disposition the
magistrate actually imposes, not that requested by the party).
III.

DISCUSSION
When similar lawsuits are filed in multiple forums, the Fourth Circuit

adheres to the “first-filed” rule, which holds that the “the first suit should have
priority, absent the showing of [a] balance of convenience in favor of the second

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action.” Volvo Constr. Equip. N. Am., Inc., v. CLM Equip. Co., Inc. , 386 F.3d 581,
594–95 (4th Cir.2004) (internal citations omitted). Multiple lawsuits are subject to
the first-filed rule if the same factual issues provide the basis for each suit. Allied–
Gen. Nuclear Serv's. v. Commonwealth Edison Co., 675 F.2d 610, 611 n.1 (4th
Cir.1982).
Courts applying the first-filed rule will dismiss, stay, or transfer a later-filed
lawsuit in deference to the earlier-filed action. See id. (citing Carbide & Carbon
Chem. Corp. v. U.S. Indus. Chems., Inc., 140 F.2d 47, 49 (4th Cir.1944)) (finding
that the earlier-filed lawsuit must proceed “to the exclusion of” subsequently-filed
lawsuits); see also Quesenberry v. Volvo Group N. Am., Inc., No. 1:09-cv-22, 2009
WL 648658, at *2–3 (W.D. Va. March 10, 2009) (“[T]he “first-to-file” rule supports
dismissing, staying or transferring [an] action . . . .”); Nutrition & Fitness, Inc. v.
Blue Stuff, Inc., 264 F. Supp. 2d 357, 360 (W.D.N.C. 2003) (“Where the same parties
have filed similar litigation in separate federal fora . . . the later-filed action should
be stayed, transferred, or enjoined.”). However, application of the rule is
discretionary, not mandatory. Nutrition & Fitness, 264 F. Supp. 2d at 361. As the
Fourth Circuit has stated, “this Circuit has no unyielding ‘first-to-file’ rule.” CACI
Intern., Inc. v. Pentagen Technologies Int'l., 1995 WL 679952, at *6 (4th Cir. 1995)
(unpublished).
Some courts in the Fourth Circuit have used a three-factor test to determine
whether cases are subject to the first-filed rule based on (1) the chronology of the
filings, (2) the similarities of the parties involved, and (3) the similarity of issues

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being raised. Remington Arms. Co., Inc. v. Alliant Techsystems, Inc. , 2004 WL
444574, at *2 (M.D.N.C. Feb. 25, 2004) (internal citations omitted). Here,
Defendant contends that the M&O erred by not applying and adhering to the firstfiled rule. Defendant claims that “if the M&O had engaged with the first-filed rule,
the result would have been different, given the substantial overlap between the
parties and issues involved in the two actions and the timing of this case relative to
the New York action, [Malcolm Wiener v. AXA Equitable Life Insurance Company,
David Hungerford, AXA Advisors, LLC, and AXA Network, LLC, Civil Action No.
1:16-CV-04019], in which the core common issues have been litigated extensively.”
(Doc. No. 22 at 5). The Court finds that this objection is meritless. Although the
M&O did not explicitly reference its engagement with the first-filed rule in the
order, the M&O considered the first-filed rule and weighed how the aforementioned
three factors apply to the case at hand. But, after assessing the three factors, the
M&O ultimately concluded that the first-filed rule does not apply in these
circumstances due to the different legal issues relevant in the New York action and
this action.
The M&O considered the first factor—the chronology of the filings—by
establishing that the instant action was filed three years after the Plaintiff filed suit
in the Southern District of New York on May 13, 2015. (Doc. No. 21 at 2–3). Within
this discussion, the M&O also considered the second factor—the similarity of the
parties—when it found that “the present action involves some of the same parties
. . . .” (Id. at 2). And finally, it considered the third factor when it concluded that,

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despite having “some of the same . . . operative facts as the New York Action . . . the
gravamen of Plaintiff’s Complaint here involves Defendant’s alleged reporting of
inaccurate medical information to [the] M[edical] I[nformation] B[oard].” (Id.). In
contrast, the M&O characterized the issues at stake in the New York action as
orbiting around “Defendant’s termination of the Policies and specifically whether
the appropriate notices were sent to Plaintiff.” (Id.). Here, on the other hand, the
M&O found that the issues turn on Plaintiff’s allegation “that Defendant’s
underwriter reported the inaccurate information to its Charlotte operations facility
who in turn reported it to MIB”—an action which Plaintiff alleges “has rendered
him uninsurable.” (Id.).
Therefore, the Court finds that the M&O did engage with the first-filed rule
and properly determined that it should not apply considering the differences
between the legal issues being raised in each action. The Court concludes that the
M&O did not commit clear error by not expressly invoking the magic term “the firstfiled rule.” No such invocation was necessary. The M&O engaged with the rule,
found that it did not apply, and instead applied the proper multi-factored test for
determining whether transfer of venue under 28 U.S.C. § 1404(a) is appropriate.
For the reasons outlined in the M&O, this Court agrees that the relevant factors
courts consider under § 1404(a) both “[q]uantitatively and qualitatively . . . weigh in
favor of retention” and that the interests of justice and convenience warrant denial
of Defendant’s Motion to Transfer Venue. Therefore, the Court concludes that the
M&O is not clearly erroneous or contrary to law, and thus denies Defendant’s

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Objection, (Doc. No. 22).
IT IS THEREFORE ORDERED that:
(1) Defendant’s Objection to the M&O, (Doc. No. 22), is DENIED; and
(2) Defendant’s Motion to Strike, (Doc. No. 24), is DENIED as moot.

Signed: February 13, 2019

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