MidAtlantic International Inc. v. AGC Flat Glass North America, Inc.
Filing
59
OPINION AND ORDER: For the reasons set forth herein, the Court DENIES Defendant's Motion to Transfer, ECF No. 37, and GRANTS Plaintiff's Motion to Commence Discovery, ECF No. 56. (See Order for Specifics) Entered and filed 5/20/13. (Signed by District Judge Robert G. Doumar on 5/20/13). (ecav, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
NORFOLK DIVISION
FILED
MIDATLANTIC
INTERNATIONAL
MAY 2 0 2013
INC.,
CLERK, US DISTRICT COURT
Plaintiff
NORFOLK. VA
CIVIL NO. 2:12cvl69
AGC FLAT GLASS NORTH AMERICA,
INC.,
Defendant / Third-Party Plaintiff,
MIDATLANTIC MINERALS, INC.,
Third-Party Defendant.
OPINION AND ORDER
This matter comes before the Court upon AGC Flat Glass North America, Inc.'s
("Defendant") Motion to Transfer Case for ForumNon-Conveniens, ECF No. 37, and Plaintiffs
Motion to Commence Discovery, ECF No. 56. For the reasons set forth herein, the Court
DENIES Defendant's Motion to Transfer, ECF No. 37, and GRANTS Plaintiffs Motion to
Commence Discovery, ECF No. 56.
I.
FACTUAL AND PROCEDURAL HISTORY
MidAtlantic International, Inc. ("Plaintiff) is a Barbadian corporation with its principal
place of business in St. Michael, Barbados. Compl. U 1, ECF No. 1. Defendant is a Delaware
corporation with its principal place of business in Alpharetta, Georgia. Compl. ^ 2, ECF No. 1.
Defendant is a manufacturer of glass products. Compl. U5, ECF No. 1. Plaintiff has been a
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supplier of dolomite, a raw material used in manufacturing flat glass, to Defendant since 1997.
Compl. 1f 5, ECF No. 1. According to Plaintiff, all of the dolomite supplied to Defendant has
been mined from the same quarry in Spain. Compl. If 6, ECF No. 1. At Defendant's request,
Plaintiff would purchase dolomite in 8,000 to 10,000 ton quantities, import the dolomite from
Spain into the United States, and store the dolomite in a warehouse near the Port of Norfolk.
Compl. If 7, ECF No. 1. Defendant would then arrange for rail transport of the dolomite from
the warehouse to its factories. Compl. If 8, ECF No. 1. Plaintiff states that Defendant was
invoiced and paid for the dolomite as each rail shipment occured. Compl. 18, ECF No. 1.
On January 14, 2008, the parties entered into a contract under which Plaintiff agreed to
supply Defendant with Spanish dolomite from 2008 to 2010.
Compl. | 9, ECF No. 1.
According to Plaintiff, this agreement was later extended beyond 2010. Compl. If 10, ECF
No. 1. The agreement included a term which provided that if Defendant stopped buying material
"for whatever reason," Defendant would pay Plaintiff"for any dolomite remaining in storage at
the warehouse in Norfolk, VA," payment to be made within 30 days from the date of invoice.
Compl. Tf 11, ECF No. 1. Each of the monthly purchase orders issued by Defendant to Plaintiff
contained a similar provision. Compl. ^ 11, ECF No. 1.
In June 2011, Plaintiff purchased 8,267.38 short tons of dolomite, transported it to
Norfolk, Virginia, and stored it in a warehouse, along with approximately 500 short tons of
dolomite still on hand from prior purchases. Compl. If 12, ECF No. 1. As was its custom,
Plaintiff furnished Defendant with a Certificate of Analysis for the June 2011 dolomite shipment.
Compl. 1f 13, ECF No. 1. According to Plaintiff, Defendant neither raised concerns about the
results nor requested further testing of the June 2011 shipment. Compl. ^f 13, ECF No. 1. From
June to September 2011, Defendant purchased and used approximately 1,800 short tons of from
the June 2011 dolomite shipment. Compl. ^ 16, ECF No. 1. In December 2010, Defendant
notified Plaintiff that there was Spinel in the dolomite that exceeded specifications. Compl. f 17,
ECF No. 1. Defendant has since refused to order any additional shipments of dolomite from
Plaintiff and has, according to Plaintiff, refused to pay for the 4,766.313 tons of dolomite
remaining in the warehouse near the Port ofNorfolk. Compl. If 17, ECF No. 1.
On March 30, 2012, Plaintiff filed a Complaint against Defendant alleging breach of
contract and seeking damages in the amount of $796,988.58. Compl. ^J 37, ECF No. 1. On
January 22, 2013, Defendant filed the instant Motion to Transfer Case for Forum Non-
Conveniens. ECF No. 37; see also Def.'s Memo in Supp. of Mot. to Transfer, ECF No. 38.
Plaintiff filed a Memorandum in Opposition to that Motion on February 5, 2013. PL's Mem. in
Opp. to Mot. to Transfer, ECF No. 42. Defendant filed a Rebuttal Brief on February 14, 2013.
ECF No. 45. On March 19, 2013, the Court held a hearing concerning Defendant's Motion to
Transfer Case for Forum Non-Conveniens. ECF No. 37.
II.
DEFENDANT'S MOTION TO TRANSFER
A.
Standard of Review
Pursuant to 28 U.S.C. § 1404(a), "[fjor 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 decision to transfer venue is committed to the
sound discretion of the district court. See One Beacon Ins. Co. v. JNB Storage Trailer Rental
Corp.. 312 F.Supp.2d 824, 828 (E.D. Va. 2004) (citing Verosol B.V. v. Hunter Douglas. Inc..
806 F. Supp. 582, 591 (E.D. Va. 1992)).
In considering whether to allow transfer, a court must determine whether: (1) the claims
could have been brought in the transferee forum; and (2) the interests of justice, as well as
convenience of the parties and witnesses, support the transfer. Koh v. Microtek Int'l. Inc.. 250 F.
3
Supp. 2d 627, 630 (E.D. Va. 2003).
B.
Discussion
1.
The Cause of Action Could Have Been Brought in the Transferee Forums
With respect to the first prong of the inquiry, a corporation is subject to personal
jurisdiction in a district where it has its principal place of business, where it has certain
"minimum contacts," or where the litigation results from injuries which arise out of, or relate to,
the corporation's activities in the district. See, e.g.. Koh. 250 F. Supp. 2d at 631; NanoEnTek.
Inc. v. Bio-Rad Labs.. 2:llcv427, 2011 WL 6023189, at *4-5 (E.D. Va. Dec. 2, 2011). If
personal jurisdiction is proper for a corporate defendant, then venue is also proper: "[Ujnder §
1400(b) [and] § 1391(c), the tests for venue and personal jurisdiction are interchangeable for
corporations." LG Elecs. Inc. v. Advance Creative Computer Corp.. 131 F. Supp. 2d 804, 810
(E.D. Va. 2001) (citing Bicicletas Windsor. S.A. v. Bicycle Corp. of America. 783 F. Supp. 781,
786 n. 4 (S.D.N.Y. 1992)); see 28 U.S.C. § 1391(c) ("[A] defendant that is a corporation shall be
deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time
the action is commenced."); 28 U.S.C. § 1400(b) (stating venue is proper where the defendant
resides).
Defendant's Motion requests that the Court transfer the case to either: (1) the United
States District Court for the Eastern District of Tennessee( "EDTN"); or (2) the United States
District Court for the Western District of Virginia ("WDVA"). Defendant states, and Plaintiff
fails to contest, that personal jurisdiction and venue are proper in those districts because Plaintiff:
(1) "has a manufacturing facility in the Eastern District of Tennessee and therefore 'resides"
there and is subject to personal jurisdiction in that forum"; and (2) "has a fabrication facility in
the Western District of Virginia, does business in the district, and is subject to personal
jurisdiction in that forum." Def.'s Mem. in Opp. to Mot. to Transfer 5, ECF No. 38. The Court
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finds, based on the aforementioned uncontested minimum contacts, that this action could have
been brought in either EDTN or WDVA.
2.
Defendant Fails to Show That The Circumstances Strongly Favor
Transfer
With that threshold inquiry met, the Court turns to the question whether transfer is
warranted. In addressing that question, the Court considers: (1) the plaintiffs choice of forum;
(2) the convenience of parties; (3) the convenience of witnesses; and (4) the interest of justice.
See Heinz. 750 F. Supp. 2d at 667 (citing JTH Tax. Inc. v. Lee. 482 F. Supp. 2d 731, 736 (E.D.
Va. 2007). The party seeking transfer bears the burden of demonstrating that "the circumstances
of the case are strongly in favor of transfer." Id.
After balancing those four factors, the Court finds that Defendant has not carried its
burden. The Court, therefore, DENIES Defendant's Motion to Transfer Case for Forum NonConveniens. ECF No. 37.
a.
Plaintiffs Choice of Forum
A plaintiffs choice of forum is "typically entitled to 'substantial weight,' especially
where the chosen forum is the plaintiffs home forum or bears a substantial relation to the cause
of action." Id. (citing Koh, 250 F. Supp. 2d at 633). Defendant, however, argues that Plaintiffs
choice of forum is entitled to no weight because the Eastern District of Virginia "is not
MidAtlantic's home forum and bears little relation to this dispute." Def.'s Rebuttal Br. 2, ECF
No. 45.
The Court disagrees with Defendant and finds that the Eastern District of Virginia bears a
substantial relation to this cause of action. The Court so finds because: (1) the dolomite at issued
arrived in the United States at the Port of Norfolk; (2) the certificate of analysis of the dolomite's
composition was provided to the customs broker, Nelson International, Inc., in Norfolk;
(3) thousands of short tons of the dolomite were stored at the Elizabeth River Terminals in
Chesapeake, Virginia prior to their transfer to the Defendant; (4) the legal risk of loss passed to
Defendant when the dolomite was loaded into railcars in the Eastern District of Virginia which
were destined for delivery to ACG's manufacturing facility in Kinsport, Tennessee; and (5) since
Defendant's alleged breach, a large quantity of the dolomite at issue remains stored at the
Elizabeth River Terminals in Chesapeake, Virginia.
See Def.'s Mem. in Supp. of Mot. to
Transfer 2, ECF No. 38 (stating that MidAtlantic rented space in a Norfolk, Virginia warehouse
to store the dolomite until employees loaded it into railcars desited for AGC's manufacturing
facility); Def.'s Mem. in Supp. of Mot. to Transfer 7, ECF No. 38 ("MidAtlantic's only basis for
filing suit in this district [Eastern District of Virginia] is that legal risk of loss passed to AGC
when the Dolomite was loaded into railcars for delivery to AGC's facility in Kingsport,
Tennessee."); PL's Mem. in Opp. to Mot. to Transfer 7, ECF No. 42 (setting forth uncontested
connections between this cause of action and the Eastern District of Virginia).
Because this cause of action bears a substantial relation to the Eastern District of
Virginia, Plaintiffs choice of forum is entitled to substantial weight. This factor, therefore,
weighs heavily against Defendant's Motion to Transfer. ECF No. 37.
b.
Convenience of the Parties and Witnesses
At the March 19, 2013 hearing on Defendant's Motion to Transfer, the Court asked both
parties to file lists of potential witnesses so that it might fairly assess the convenience of the
parties and witnesses. Unfortunately, the parties responded by filing what the Court suspects to
be unnecessarily cumulative lists in an effort to influence the Court's decision on the instant
Motion to Transfer.
Holding constant for any such manipulation, the Court finds that
convenience of the parties and witnesses weighs neither for nor against transfer.
One day prior to the Court's March 19, 2013 hearing on Defendant's Motion to Transfer,
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Plaintiff served upon Defendant a document entitled "MidAtlantic International Inc.'s Rule
26(a)(1) Initial Disclosure."1 That document lists eight persons with discoverable information,
six of whom reside in the Eastern District of Virginia and two who reside elsewhere. Since the
March 19 hearing, Plaintiff has filed two supplemental lists. The first, which was filed with the
Court on April 1, 2013, made two modifications and adds nine names to the list of persons with
discoverable information, four of whom reside in the Eastern District of Virginia and five who
reside elsewhere. The second, which was filed with the Court on April 18, 2013, merely
provides declarations for previously-identified persons with discoverable information.
In assessing convenience of the parties and witnesses, the Court will disregard the first
and second supplements filed by the Plaintiff. It seems that Plaintiffs original Rule 26(a)(1)
disclosure, served on Defendant one day prior to the hearing, is the truest representation of
Plaintiffs potential witnesses in this matter. Moreover, based on the descriptions provided, the
testimony of the eight persons set forth in that original list does not appear unduly cumulative.
Of those eight persons, six reside in the Eastern District of Virginia.
The other two reside
overseas, and it would be no more convenient for them to travel to the Eastern District of
Virginia than either of the other two forums identified in Defendant's Motion.
As for the convenience of the Defendant and Defendant's witnesses, the Defendant did
not furnish the Plaintiff with a Rule 26(a)(1) disclosure prior to the March 19 hearing.2 Thus, the
1To assist in its consideration ofthe instant Motion, on May 14, 2013 the Court requested that the parties
provide the Court with any prior Rule 26(a)(1) disclosures. Plaintiff replied that day and provided the Court with an
initial disclosure and two supplemental disclosures. Plaintiffs original Rule 26(a)(1) disclosure was never filed with
the Court, but remains on file with the Court. The first and second supplemental disclosures were, however, filed
with the Court under the title of "Witness List." See PL's Witness List, ECF No. 52; PL's Supp. Witness List, ECF
No. 55.
2There has not been a Rule 26(0 conference inthis matter. See Fed. R. Civ. P. 26(0. Therefore, as ofthe
March 19 hearing, the parties were not yet obligated to serve their Rule 26(a)(1) disclosures. See Fed. R. Civ. P.
26(a)(1)(C) (setting forth time for initial disclosures). At the March 19 hearing, the Court directed both parties to
furnish a list of potential witnesses within 11-days. Defendant complied with the Court's directive and filed its
potential witness list on March 28, 2013. Def.'s Initial Disci, of Witnesses and Test Results, ECF No. 51.
Court must rely on the post-hearing list filed by Defendant on March 28, 2013. That list
identifies 17 persons with discoverable information, 16 of whom reside in Tennessee and one
who resides elsewhere. However, based on the descriptions provided, it is clear to the Court that
much ofthe testimony those 17 persons would provide is cumulative. For instance, nine ofthe
persons identified would testify to their knowledge of test results and quality problems. Two
others—Dennis Ervin and Bruce A. Flaherty—would testify to overall knowledge of quality
problems, Spanish dolomite test results, disposition of the dolomite, and decisions regarding the
same. See generally AGC's Witness List, ECF No. 51-4.
Holding constant for these and other instances of cumulative testimony, the Court finds
that approximately eight persons would be called by Defendant AGC to testify at trial, seven of
whom reside in Tennessee and one who resides in Georgia. Of those seven in Tennessee, four
are currently employed by Defendant, as is the witness residing in Georgia. This Court has
previously explained that "[t]he convenience of party witnesses plays a reduced role in the
court's analysis." NanoEntek. Inc.. 2011 WL 6023189, at *5 (citing USA Labs., 2009 U.S. Dist.
LEXIS 37797, at *4, 2009 WL 1227867 ("Courts have repeatedly emphasized that in
considering whether to transfer a case under 28 U.S.C. § 1404(a), the inconvenience to party
witnesses is notafforded the same weight as the inconvenience to non-party witnesses.")). Thus,
ofthose eight AGC witnesses who might testify attrial, five are to be afforded reduced weight in
the Court's transfer analysis because they are currently employed byDefendant.
Taking all this into consideration, the Court finds that the convenience of parties and
witnesses weighs neither for nor against transfer. Regardless of which forum is chosen, one or
the other parties, and approximately the same number ofwitnesses, will be inconvenienced,
c.
Interest of Justice
Finally, pursuant to 28 U.S.C. § 1404, the Court must consider whether the interest of
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justice supports transfer. See 28 U.S.C. § 1404(a). This "interest of justice" analysis requires
the Court to consider "circumstances such as 'the pendency of a related action, the court's
familiarity with the applicable law, docket conditions, access to premises that might have to be
viewed, the possibility of unfair trial, the ability to join other parties, and the possibility of
harassment.'" Agilent Technologies. Inc. v. Micromuse. Inc.. 316 F. Supp. 2d 322, 329 (E.D.
Va. 2004) (citing Bd. of Trustees v. Bavlor Heating and Air Conditioning. 702 F. Supp. 1253,
1260 (E.D. Va. 1988)).
Defendant argues that the interest ofjustice weighs in favor of transfer because this
action "has virtually no connection to" the Eastern District of Virginia. See Def.'s Memo in
Supp. of Mot. to Transfer 14, ECF No. 38. But, as set forth in Part 11(A) of this Opinion and
Order, the Court has already found that the Eastern District of Virginia bears a substantial
relation to this cause ofaction. The Court, therefore, rejects Defendant's argument and finds that
the interest ofjustice weighs neither for nor against transfer.
C.
Conclusion
After balancing the four aforementioned factors, the Court finds that Defendant has not
carried its burden. The Plaintiffs choice of forum weighs decidedly against transfer. But,
convenience ofthe parties and witnesses, as well as the interest ofjustice, weighs neither in favor
of nor against transfer. Thus, the Court FINDS that the balance weighs against transfer and
DENIES Defendant's Motion to Transfer Case for Forum Non-Conveniens. ECF No. 37.
III.
PLAINTIFF'S MOTION TO COMMENCE DISCOVERY
On May 10, 2013, Plaintiff filed a Motion to Commence Discovery, ECF No. 56, which
states that Defendant has refused to commence discovery while Defendant's Motion to Transfer
is pending. As aresult, the parties have not yet held aRule 26(f) discovery planning conference.
By this Opinion and Order, the Court DENIES Defendant's Motion to Transfer. ECF
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No. 37. To that end, there is no justification for further delay in the discovery process. The
Court, therefore, GRANTS Plaintiffs Motion to Commence Discovery and ORDERS the
parties, in accordance with Rule 26(f), to promptly confer and develop adiscovery plan on or
before Friday, May 24, 2013 at 4:00 P.M. Eastern Standard Time. The Court further ORDERS
that, in accordance with Rule 26(f)(2), the parties shall present their discovery plan to the Court
on or before Friday, June 7,2013 at 4:00 P.M. Eastern Standard Time.
IV.
CONCLUSION
For the reasons set forth herein, the Court DENIES Defendant's Motion to Transfer, ECF
No. 37, and GRANTS Plaintiffs Motion to Commence Discovery, ECF No. 56. The Clerk is
DIRECTED to forward acopy ofthis Order to all Counsel ofRecord.
IT IS SO ORDERED.
^or5eTt^GTDOTmi|
.iu',^; Uniied Staffi&Oistricl Juuge
UNITED STATES DISTRICT JUDGE
Norfolk. V A
May ZP.2013
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