BERNDT v. DELOITTE & TOUCHE LLP et al

Filing 30

MEMORANDUM ORDER AND OPINION THAT PLAINTIFF'S MOTION TO TRANSFER VENUE IS DENIED WITHOUT PREJUDICE; ETC.. SIGNED BY HONORABLE LEGROME D. DAVIS ON 7/25/12. 7/25/12 ENTERED AND E-MAILED.(jl, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
STEPHEN BERNDT

:
:
:
:
:

v.
DELOITTE & TOUCHE LLP et al.

CIVIL ACTION

NO. 12-cv-2157

MEMORANDUM ORDER
AND NOW, this 25th day of July, 2012, upon consideration of Plaintiff’s Motion to
Transfer Venue (Doc. No. 23), Defendants’ opposition thereto (Doc. No. 25), and Plaintiff’s
reply (Doc. No. 28), it is hereby ORDERED that Plaintiff’s transfer motion (Doc. No. 23) is
DENIED WITHOUT PREJUDICE. It is further ORDERED that counsel for both parties shall
furnish Judge Engelmayer (S.D.N.Y.) and Judge Berman (S.D.N.Y.) with a copy of this Order no
later than July 27, 2012. If circumstances change, e.g., either Judge Berman or Judge
Engelmayer manifests a willingness to consolidate this matter with his respective parallel
proceeding, Plaintiff may renew his § 1404(a) transfer motion.
I.

Factual Background and Procedural History
This case is one of several putative class actions in which plaintiffs complain that

Defendants, Deloitte & Touche LLP and Deloitte LLP (together, “Deloitte”), misclassified
plaintiffs and other non-licensed audit employees as exempt and accordingly failed to pay them
overtime compensation in violation of various labor laws. A brief chronology follows.

1

Date

Case Number and Jurisdiction

Summary of Action

4/11/11

Gersten v. Deloitte & Touche
LLP, No. 11-cv-2461 (S.D.N.Y.)

Filing of class action complaint alleging
violations of Fair Labor Standards Act (FLSA)
and the New York Labor Law (NYLL). Case
assigned to Judge Richard Berman.

4/26/11

James v. Deloitte & Touche
LLP, No. 11-cv-2027 (N.D.
Cal.).

Filing of collective action complaint alleging
violations of FLSA only. Case assigned to
Judge James Ware.

6/23/11

James v. Deloitte & Touche
LLP, No. 11-cv-2027 (N.D.
Cal.).

Judge Ware transfers the James action to the
Southern District of New York (11-cv-4554)

11/22/11

In re Deloitte & Touche LLP
Overtime Litigation, No. 11-cv2461 (S.D.N.Y.)

Judge Berman consolidates the Gersten and
James actions under the name In re Deloitte &
Touche LLP Overtime Litigation.

12/16/11

In re Deloitte & Touche LLP
Overtime Litigation, No. 11-cv2461 (S.D.N.Y.)

Judge Berman issues an Order granting
plaintiffs’ motion for conditional class
certification.

2/20/12

Berndt v. Deloitte & Touche
LLP, Case ID: 120202193
(Phila. C.P.)

Filing of class action complaint in Philadelphia
Court of Common Pleas alleging claims under
the Pennsylvania Minimum Wage Act
(PMWA) only (no FLSA claim).

4/20/12

Berndt v. Deloitte & Touche
LLP, No. 12-cv-2157 (E.D. Pa.)

Defendants remove Berndt action to this Court
pursuant to the Class Action Fairness Act
(CAFA).

5/30/12

Bukhari v. Deloitte & Touche
LLP, No. 12-cv-4290 (S.D.N.Y.)

Filing of class action complaint alleging
violations of Massachusetts, Minnesota, and
Ohio state labor laws only (no FLSA claim).
Case referred to Judge Berman as potentially
related to the now-consolidated James action.

5/31/12

Berndt v. Deloitte & Touche
LLP, No. 12-cv-2157 (E.D. Pa.)

Plaintiff moves pursuant to 28 U.S.C. §
1404(a) to transfer this matter to the Southern
District of New York for potential
consolidation with In re Deloitte & Touche
LLP Overtime Litigation and/or Bukhari.
Defendants oppose the transfer.

6/13/12

Bukhari v. Deloitte & Touche
LLP, No. 12-cv-4290 (S.D.N.Y.)

Judge Berman declines Bukhari as a related
case. The case is subsequently assigned to
2

Judge Paul Engelmayer. As a result, two
different judges in the Southern District of
New York are now handling these parallel
suits.
6/28/12

Berndt v. Deloitte & Touche
LLP, No. 12-cv-2157 (E.D. Pa.)

On Defendants’ request, this Court issues an
Order holding Plaintiff’s transfer motion in
abeyance until July 19, 2012 pending
developments in Bukhari. In making this
request, Defendants strongly implied that they
may seek to transfer Bukhari to Massachusetts,
Minnesota, and/or Ohio. (See Doc. No. 25, at
3-4, 7-8). Defendants made no mention of
moving to transfer Bukhari to this Court.

7/17/12

Bukhari v. Deloitte & Touche
LLP, No. 12-cv-4290 (S.D.N.Y.)

Without prior notice to this Court, Defendants
move to transfer Bukhari (a putative class
action brought by Massachusetts, Minnesota,
and Ohio plaintiffs under Massachusetts,
Minnesota, and Ohio law against a company
headquartered in New York) to the Eastern
District of Pennsylvania.

Given the above, we face a rather unusual situation. Through his counsel, Plaintiff
Berndt, who (1) lives in Pennsylvania, (2) seeks to represent a class of Pennsylvania employees,
(3) complains only of violations of Pennsylvania law, and (4) originally brought this suit in
Pennsylvania state court, has asked us to transfer this matter to the Southern District of New York
for consolidation, even though Judge Berman, our colleague in New York handling the
consolidated matter, has already declined Bukhari (a parallel state-law-only case) as unrelated.
What’s more, Defendant Deloitte, a New York-based corporation that previously argued in James
that the Southern District of New York was a more convenient forum,1 not only opposes our

1

In James, Deloitte argued, e.g., that the Southern District of New York was a more
convenient forum because Deloitte’s headquarters are in New York; Deloitte makes and implements
(continued...)
3

transfer of the instant matter to New York but has also moved to transfer Bukhari, a case with no
discernable ties to Pennsylvania, from New York to the Eastern District of Pennsylvania.
It seems to us that both parties are forum shopping for strategic reasons and actually care
little about the “convenience of parties and witnesses.” 28 U.S.C. § 1404(a). After all, each side
wants to litigate this matter in what would appear to be a forum less convenient for the party
making the request: the Pennsylvania Plaintiff (or at least his lawyer) wants to litigate in New
York, and the New York Defendants want to litigate in Pennsylvania. As explained herein, we
exercise our discretion and decline to transfer this matter to the Southern District of New York.
Considering the current procedural posture of the parallel New York cases, as well as the
differences among the wage and hour laws of the relevant states as highlighted by Deloitte (see
Doc. No. 25, at 7), we see little chance of consolidation of the state-law-focused cases against
Deloitte (in New York or elsewhere) absent a formal MDL. Under the circumstances, we will
not burden a (potentially third different) New York judge with our Pennsylvania-specific case.
II.

Legal Analysis
Pursuant to 28 U.S.C. § 1404(a), we may transfer a civil action to another judicial district

“[f]or the convenience of parties and witnesses, in the interest of justice . . . .” In analyzing a §
1404(a) transfer motion, we consider “all relevant factors to determine whether on balance the
litigation would more conveniently proceed and the interests of justice be better served by
transfer to a different forum.” Salovaara v. Jackson Nat’l Life Ins. Co., 246 F.3d 289, 297-98 n.5
(3d Cir. 2001) (quoting Jumara v. State Farm Ins. Co., 55 F.3d 873, 879 (3d Cir. 1995)). Such,

1

(...continued)
certain operative decisions in New York; and a court in the Southern District of New York could
most easily monitor injunctive relief.
4

factors may include, e.g., the “plaintiff’s forum preference as manifested in the original choice”;
the defendant’s preference; where the claim arose; the convenience of the parties as indicated by
their relative physical and financial condition; the convenience of the witnesses; the location of
books and records; the enforceability of the judgment; practical considerations that could make
the trial easy, expeditious, or inexpensive; the relative administrative difficulty in the two fora
resulting from court congestion; the local interest in deciding local controversies at home; the
public policies of the fora; and the familiarity of the trial judge with the applicable state law in
diversity cases. Jumara, 55 F.3d at 879-80. “The burden of establishing the need for transfer . . .
rests with the movant.” Id. at 879.
Here, Plaintiff’s primary argument for transfer sounds in judicial economy, i.e., “practical
considerations that could make the trial easy, expeditious, or inexpensive.” (See Doc. No. 24, at
5-7; Doc. No. 28). Specifically, Plaintiff argues that we should transfer this case to the Southern
District of New York so that it can be consolidated with Bukhari, a case concerning facts and
circumstances similar to those in our matter. As the Plaintiff sees it, “[c]onsolidation of these
actions in a single federal court would therefore be easier, more expeditious, and less expensive –
and less wasteful of judicial resources– than litigating this action and the Gersten, James, and
Bukhari actions in two separate tribunals.” (Doc. No. 24, at 7).
In theory, we agree. As the Supreme Court has cautioned, “[t]o permit a situation in
which two cases involving precisely the same issues are simultaneously pending in different
District Courts leads to the wastefulness of time, energy and money that § 1404(a) was designed
to prevent.” Ferens v. John Deere Co., 494 U.S. 516, 531 (1990) (quoting Cont’l Grain Co. v.
Barge FBL-585, 364 U.S. 19, 26 (1960)). However, as circumstances currently stand, we have
5

little reason to believe that our colleagues in the Southern District of New York would actually
consolidate this matter with either Bukhari or In re Deloitte & Touche LLP Overtime Litigation.
As noted supra, the Bukhari matter was initially referred to Judge Berman as potentially
related to the previously consolidated In re Deloitte & Touche LLP Overtime Litigation. But
Judge Berman declined to consider Bukhari a “related” case. As such, Bukhari was randomly
assigned to Judge Engelmayer. Consequently, two different judges in New York are now
handling these parallel labor law cases against Deloitte. Against this backdrop, we see nothing
indicating that either Judge Berman or Judge Engelmayer would consolidate this Pennsylvania
case with either In re Deloitte & Touche LLP Overtime Litigation or Bukhari. In other words,
although consolidation might be legally permissible under, e.g., Federal Rule of Civil Procedure
42(a), we perceive no impending consolidation here.
And Judge Berman and Judge Engelmayer would certainly have the discretion to decide
against consolidating our case, brought by Pennsylvania plaintiffs under Pennsylvania law, with
either of their cases, which have nothing to do with Pennsylvania. Although the factual
allegations (and hence, the likely factual discovery) of all the plaintiffs undoubtedly overlap, the
relevant states all have distinctive wage and hour laws. As Deloitte points out, Massachusetts,
Minnesota, Ohio, and Pennsylvania all have different statutes of limitations, damages provisions,
and/or exemption definitions. (See Doc. No. 25, at 7 & n.2). Similarly, Plaintiff concedes that
“the overtime exemptions under the PMWA are narrower than the FLSA’s.” (Doc. No. 28, at 3).
Facing these multiple, diverse, state-specific labor laws, a reasonable judge might rightfully
conclude that consolidation is not warranted. In fact, it appears to us that Judge Berman already
implicitly rejected the idea of consolidation by refusing the Bukhari matter. If we were to
6

transfer our matter to New York, we run the very real risk that a third different judge in the same
court would be assigned to the case. For these reasons, judicial economy concerns do not weigh
in favor of transferring this case to the Southern District of New York.
Plaintiff also argues that we should respect his choice of forum, and he now wants to
litigate this case in the Southern District of New York. In a typical case, the plaintiff’s choice of
forum is entitled to some deference in the § 1404(a) context. However, this is no typical case.
Under normal circumstances, the plaintiff brings suit in his desired forum and the defendant
seeks transfer to a more “convenient” jurisdiction. Hence the Jumara court’s suggestion that we
consider the “plaintiff’s forum preference as manifested in the original choice” in our § 1404(a)
analysis. 55 F.3d at 879. Here, the Plaintiff, not the Defendant, has moved for transfer. As
“manifested in [Plaintiff’s] original choice,” Plaintiff preferred to litigate this matter in
Pennsylvania state court, not New York federal court. Moreover, “the plaintiff’s choice of forum
is a less significant consideration in a (here, putative) class action than in an individual action.”
In re Warrick, 70 F.3d 736, 740-41 & n.7 (2d Cir. 1995) (citation omitted). For these reasons, we
see no persuasive rationale to defer to Plaintiff’s request to transfer his own case to the Southern
District of New York. If Plaintiff wished to litigate in New York, he could have filed there
originally (just like the Bukhari plaintiffs did).
The “convenience of parties and witnesses” factor cuts both ways. On the one hand,
litigating in New York would be more convenient for Deloitte because Deloitte is headquartered
there. On the other hand, litigating in Pennsylvania would be more convenient for Berndt, a
Pennsylvania citizen and resident, and those current and former Deloitte employees Berndt hopes
to represent in this putative class action, also citizens of Pennsylvania. And Berndt, as an
7

individual, undoubtedly “lacks the resources to which Defendants have access.” (Doc. No. 24, at
8). Thus, this factor is either neutral or weighs slightly against transfer.
Likewise, many of the other Jumara factors do not point strongly in one direction or the
other. Berndt’s claim arose in Pennsylvania, but Deloitte allegedly established, implemented,
and enforced its unlawful policy of classifying non-licensed audit employees as overtime exempt
in the Southern District of New York. Both Pennsylvania and New York have a “local interest”
in this matter because the (proposed) Plaintiffs are Pennsylvania citizens but Deloitte is based in
New York. We do not doubt our ability to adequately enforce any judgment in this matter, and
we assume the judges in New York feel the same. Both this Court and the Southern District of
New York have busy dockets. See Federal Court Management Statistics,
http://www.uscourts.gov/Statistics/FederalCourtManagementStatistics/DistrictCourtsSep2011.as
px (Sept. 2011). And “[t]he technological advances of recent years have significantly reduced
the weight of [the location of the books and records] in the balance of convenience analysis.”
InfoMC, Inc. v. Comprehensive Behavioral Care, Inc., Civ. No. 10–4907, 2012 WL 1114360, at
*17 (E.D. Pa. Mar. 30, 2012) (citation omitted).
Finally, this Court likely has greater familiarity with the PMWA than does the Southern
District of New York. This weighs against transfer. See, e.g., Van Dusen v. Barrack, 376 U.S.
612, 645 (1964) (“There is an appropriateness in having the trial of a diversity case in a forum
that is at home with the state law that must govern the case, rather than having a court in some
other forum untangle problems in conflict of laws, and in law foreign to itself.”) (citation
omitted); In re E. Dist. Repetitive Stress Injury Litig., 850 F. Supp. 188, 196 (E.D.N.Y. 1994)

8

(“Federal courts have generally favored adjudication of a controversy by the court which sits in
the state whose law will provide the rules of decision.”) (citations omitted).
After due deliberation, we conclude that we would not serve the interests of justice by
transferring this case to the Southern District of New York. If circumstances change, e.g., either
Judge Berman or Judge Engelmayer indicates that he wishes to consolidate this matter with In re
Deloitte & Touche LLP Overtime Litigation (Berman, J.) or Bukhari (Engelmayer, J.), we may
reconsider our position.
III.

Conclusion
For the aforementioned reasons, Plaintiff’s Motion to Transfer Venue (Doc. No. 23) is

DENIED WITHOUT PREJUDICE.

BY THE COURT:
/s/ Legrome D. Davis
Legrome D. Davis, J.

9