Kraus, M.D. v. Nighthawk Radiology Services, LLC

Filing 38

ORDER denying 18 Defendant's Motion to Change Venue. Signed by Judge Gregory L Frost on 11/9/11. (sem1)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
FREDERICK C. KRAUS, M.D.,
Plaintiff,
Case No. 2:11-cv-558
JUDGE GREGORY L. FROST
Magistrate Judge E.A. Preston Deavers

v.
NIGHTHAWK RADIOLOGY
SERVICES, LLC,
Defendant.

OPINION AND ORDER
This matter is before the Court for consideration of Defendant’s motion to transfer venue
(ECF No. 18), Plaintiff’s memorandum in opposition (ECF No. 23), Defendant’s reply
memorandum (ECF No. 28), and Plaintiff’s surreply memorandum (ECF No. 32). For the
reasons that follow, this Court finds the motion not well taken.
I. Background
Defendant, NightHawk Radiology Services, LLC, is in the business of providing
radiology diagnostic services to hospitals, doctor offices, and other medical facilities throughout
much of the United States and internationally. Plaintiff, Frederick C. Kraus, is a licensed
radiologist who since 2004 worked as an independent contractor for Defendant to provide
Defendant’s customers with radiological interpretation services. The most recent renewal of the
contract between the parties provides that Plaintiff is required to maintain his license in each of
the forty states in which there is a facility that Defendant services. The December 1, 2009December 31, 2011 agreement provides that Plaintiff bears the cost of his initial licensing and
credentialing and that “all other costs for state licensing and hospital credentialing, including any
required travel, and renewals will be paid by [Defendant].” (ECF No. 1-1 ¶ 17.)

Prior to entering into the foregoing agreement with Defendant, Plaintiff had been sued for
medical malpractice and wrongful death in Ohio. That lawsuit was settled in 2005, and Plaintiff
disclosed the settlement to the state medical boards in the states in which he was licensed. The
Colorado State Board of Medical Examiners, Department of Regulatory Agencies opened an
investigation that resulted in a June 2009 letter of admonishment to Plaintiff, who in turn failed
to appeal the admonishment within the twenty-day time period for doing so. After this
admonishment was subsequently reported by the Colorado State Board of Medical Examiners,
Department of Regulatory Agencies to all states in which Plaintiff was licensed, numerous
investigations arose. Plaintiff has defended himself in several proceedings and additional
proceedings apparently remain ongoing.
Plaintiff asserts that under their agreement, he is entitled to reimbursement from
Defendant for his attorney’s fees and costs, as well as his travel costs and compensation for his
time, spent in defending the various state disciplinary actions. In an effort to obtain such
reimbursement, Plaintiff filed the instant action in the Franklin County Court of Common Pleas.
He asserts state law claims for declaratory judgment, breach of contract, and negligence. (ECF
No. 1-1 ¶¶ 52-66.) Following removal, Defendant filed a motion to transfer this case to the
United States District Court for the District of Minnesota pursuant to 28 U.S.C. § 1404(a). (ECF
No. 18.) After a series of delays largely related to a now-resolved default judgment issue, the
parties have completed briefing the issues involved, and the motion to transfer is ripe for
disposition.

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II. Discussion
A. Standard Involved
A transfer of venue is appropriate under 28 U.S.C. § 1404(a) “[f]or the convenience of
parties and witnesses, in the interest of justice . . . to any other district or division where it might
have been brought.” 28 U.S.C. § 1404(a). A district court has discretion whether to transfer
venue. Zomba Enter., Inc. v. Panorama Records, Inc., 491 F.3d 574, 588 (6th Cir. 2007). The
Sixth Circuit has stated that in deciding whether to transfer a case, “a district court should
consider the private interests of the parties, including their convenience and the convenience of
potential witnesses, as well as other public-interest concerns, such as systemic integrity and
fairness, which come under the rubric of ‘interests of justice.’ ” Moses v. Bus. Card Express,
Inc., 929 F.2d 1131, 1137 (6th Cir. 1991). The movant bears the burden to demonstrate that the
balance of factors strongly favors transfer. Hanning v. New England Mut. Life Ins. Co., 710 F.
Supp. 213, 214 (S.D. Ohio 1989). Private interest factors of the parties include “ ‘the relative
ease of access to sources of proof; availability of compulsory process for attendance of
unwilling, and the cost of obtaining attendance of willing, witnesses; . . . and all other practical
problems that make trial of a case easy, expeditious and inexpensive.’ ” Id. at 214 (quoting Gulf
Oil Corp. Gilbert, 330 U.S. 501, 508 (1947)).
Transfer is inappropriate if it merely shifts the burden of inconvenience. See Reed
Elsevier, Inc. v. Innovator Corp., 105 F. Supp. 2d 816, 821-22 (S.D. Ohio 2000). There is thus a
strong presumption in favor of a plaintiff’s choice of forum that “may be overcome only when
the private and public interest factors clearly point towards trial in the alternative forum.” Piper
Aircraft Co. v. Reyno, 454 U.S. 235, 255 (1981). See Trustar Funding v. Mruczynski, No. 1:09-

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cv-01747-CAB, 2010 WL 1539759, at *10 (N.D. Ohio Mar. 30, 2010) (“ ‘Plaintiff’s choice of
forum should be given ‘great’ or ‘substantial’ weight when considering whether to transfer a
case under § 1404(a).’ ” (quoting U.S. v. Cinemark USA, Inc., 66 F. Supp. 2d, 881, 888 (N.D.
Ohio 1987))). A plaintiff’s choice of forum is given little weight “ ‘where none of the conduct
complained of occurred in the forum selected by the plaintiff.’ ” Keybanc Capital Markets v.
Alpine Biomed Corp., No. 1:07 CV 1227, 2008 WL 828080, at *7 (N.D. Ohio Mar. 26, 2008)
(quoting Edmison v. Vision Inv. & Dev., LLC, No. 1:06 CV 1108, 2006 WL 3825149, at *5
(N.D. Ohio Dec. 26, 2006)).
B. Analysis
Defendant argues that transfer is warranted to the United States District Court for the
District of Minnesota based on the convenience to the parties and witnesses and the interests of
justice. The company asserts that the parties’ dispute “has virtually no relation to the State of
Ohio” and notes that, following a merger with Minnesota company Virtual Radiologic, its
headquarters is now located in Minnesota.1 (ECF No. 18, at 4.) When Plaintiff filed the action
in state court on December 15, 2010, Defendant was an Idaho limited liability company that was
registered to do business in Ohio. (ECF No. 1-1 ¶ 2.) According to the Complaint, Plaintiff
maintains residences in Florida and Australia. (ECF No. 1-1 ¶ 1.) Thus, Defendant concludes,
Plaintiff will have to travel regardless of whether the action is in Ohio or Minnesota.
The parties disagree as to whether Plaintiff could have brought this action in the United
States District Court for the District of Minnesota. This Court recognizes that Defendant was a

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All pinpoint references to documents filed on the electronic docket shall be to the
original page numbers of the documents involved, not to the page numbers assigned by the
electronic filing system.
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resident of Minnesota even prior to its affiliation with Minnesota entity Virtual Radiologic. The
Court shall therefore move directly to the parties’ arguments regarding case-specific factors.
This Court recognizes that the location of the complained-of activity weighs somewhat in
favor of transfer. Almost none of the key or core activity giving rise to Plaintiff’s claims
occurred in Ohio. The underlying malpractice proceedings took place in Ohio, but the relevance
of the details of that action is at best likely to be minimal if it exists at all. Plaintiff disputes
Defendant’s contention that he suffered no harm in Ohio and points this Court to the fact that he
incurred attorney’s fees and expenses in responding to an investigation by the Ohio Medical
Board. This fact does inform the issue of damages, although that alone is not dispositive of this
factor. A plaintiff’s choice of forum is usually awarded high deference, but that is simply one
factor in the analysis and is not alone dispositive. Lewis v. ACB Bus. Servs., Inc., 135 F.3d 389,
413 (6th Cir. 1998). This Court is cognizant that a plaintiff’s choice of forum is given less
weight where none of the complained-of activity occurred in the plaintiff’s choice of forum.
Keybanc Capital Markets, 2008 WL 828080, at *7. Accordingly, the Court finds that the fact
that nearly if not all of the complained-of conduct occurred elsewhere weighs somewhat in favor
of transfer.
In reviewing the private interest factors, including the location of sources of proof, the
convenience of witnesses, the availability of compulsory process for unwilling witnesses, and
judicial economy, the Court finds, however, that the balance does not strongly weigh in favor of
transfer. Access to documents in this age of modern discovery is an unpersuasive consideration
here. Defendant has failed to demonstrate why discovery conducted from Ohio would be
problematic or why discovery conducted in Minnesota would be so much easier so as to favor

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transfer. This same rationale undercuts Plaintiff’s assertion that the Court should decline transfer
in part because the voluminous evidence from the tangentially related malpractice action is in
Ohio.
As Plaintiff notes, it appears that the primary issue in this litigation will be contract
interpretation. To the extent that the testimony of unidentified witnesses will be necessary, there
has been no showing of problems with such testimony. There is no basis here to conclude that
compulsory process will be unavailable and there has been no showing of the costs involved.
Neither judicial economy nor the interests of justice compel transfer. This Court has
already held several conferences in this litigation, has hosted a deposition in its conference room,
has become generally familiar with the basic facts and claims, and has issued several decisions in
this action, including one that vacated the state court’s entry of default judgment. Moreover,
Ohio is at worst essentially equally inconvenient to both parties. Removing some of that
inconvenience for only one party presents insufficient cause to effectuate a contested transfer.
Because Defendant has failed to persuade this Court that the balance of factors strongly favors
transfer, the Court in its discretion declines to push this litigation from the venue in which it has
already received attention.
III. Conclusion
The Court DENIES Defendant’s motion to transfer. (ECF No. 18.)
IT IS SO ORDERED.

/s/ Gregory L. Frost
GREGORY L. FROST
UNITED STATES DISTRICT JUDGE

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