NFR, LLC et al v. NFC, LLC

Filing 10

MEMORANDUM OPINION. Signed by Senior District Judge James R. Spencer on 08/17/2015. (tjoh, )

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
RICHMOND DIVISION
NFR, LLC, et al.,
Plaintiffs,
v.

Action No. 3:15-CV-367

CORIZON HEALTH, INC.,
Defendant.
MEMORANDUM OPINION
THIS MATTER is before the Court on a Motion to Transfer (“Motion”) filed by Corizon
Health, Inc. (“Defendant”). ECF No. 3. Defendant seeks to transfer this case to the Tallahassee
Division of the United States District Court for the Northern District of Florida pursuant to 28
U.S.C. 1404(a).

Plaintiffs NFR, LLC/d/b/a Nursefinders of Richmond, NFNN, LLC d/b/a

Nursefinders of Newport News, NFC. LLC d/b/a Nursefinders of Charlottesville, NFRO, LLC
d/b/a Nursefinders of Roanoke, (“the Virginia Plaintiffs”), NFSC, LLC d/b/a Nursefinders,
Nursefinders of Jacksonville, LLC, Nursefinders of Pensacola, LLC, Nursefinders of Tampa, LLC,
Nursefinders of Northern Florida, LLC (“the Florida Plaintiffs”) (collectively, “Plaintiffs”) oppose
the Motion. For the reasons stated below, the Court will DENY Defendant’s Motion.
I.

FACTUAL AND PROCEDURAL BACKGROUND
On March 20, 2015, Plaintiffs filed a Complaint against Defendant in Chesterfield

County, Virginia Circuit Court, seeking $198, 432 in compensatory damages on the grounds that
Defendant allegedly breached its contract with Plaintiffs. Subsequently, Defendant removed the
case to this Court. ECF No. 1. On July 6, 2015, Defendant filed the instant Motion. Plaintiffs
filed a response on July 17, 2015. Defendants filed a reply on July 23, 2015.
Plaintiffs are all limited liability companies. Plaintiffs admitted, by stipulation, that “all
of the members of each plaintiff entity are citizens of either Virginia or Florida.” ECF No. 1 Ex.
1

B (“Pls.’ Stipulation”) ¶ 4. Defendant is a Delaware corporation with its principal place of
business in Brentwood, Tennessee. ECF No. 1, Ex. C (“Def.’s Stipulation”) ¶¶ 3-4.
Plaintiffs are a group of health care professional staffing companies in Virginia and
Florida.

Specifically, they are in the business of employing nurses and other health care

professionals for temporary placement at its customers’ facilities.

Defendant is a private

correctional healthcare provider, which provides health care services to 110 locations in Florida.
On April 30, 2013, the parties entered into an agreement whereby Plaintiffs would provide
nursing professionals to Defendant on a temporary basis (the “April Agreement”). The April
Agreement identified all Plaintiffs and Defendant as parties to the contract and was signed by
Grace Perkinson (“Ms. Perkinson”), whose title is “Area Director,” and Stuart Campbell, who is
COO of Defendant. The April Agreement provides for: (i) payment of invoices on a net 45
basis; (ii) the assessment of interest at the rate of one and one-half percent (1.5%) per month on
all amounts not paid within thirty (30) days; and (iii) reasonable attorney's fees for the cost of
collection. Further, the April Agreement gave Defendant the option of permanently hiring
Plaintiffs’ nurses at a fee of 30% of the nurse’s annual salary (“buy-out fee”).
In mid-August 2013, the parties began negotiating a separate agreement for nurse
staffing in Florida (“the Florida Agreement”).

On August 12, 2013, Defendant requested

language for the Florida Agreement providing a 30-day grace period from the time Defendant
transitioned into a Florida correctional facility during which Defendant would not incur a
buy-out fee if it hired any nurses from Plaintiffs. The proposed language is as follows:
Once Corizon transition[s] into each Florida DOC facility, there will exist a
30 day grace period for all current staff and disciplines listed on Exhibit-B
(Bill Rates) in which Corizon can hire staff personnel directly and incur no
buyout fees. After the 30 day grace period is elapsed the conversion fee of
30% of the employees’ annual salary will apply.
Complaint (“Compl.”) ¶ 22. The Florida Agreement contains the 30-day grace period.

On

August 21, 2014, Ms. Perkinson, on behalf of the Florida Plaintiffs executed the Florida
2

Agreement. The Florida Plaintiffs, but not the Virginia Plaintiffs, are parties to the Florida
Agreement. The Florida Agreement, which Defendant received from the Florida Plaintiffs, also
contained a separate, appended Business Associate Contract. See Complaint (“Compl.”) ¶ 24.
The signatory for Defendant mistakenly believed that the appended document contained the sole
signature block for the Florida Agreement and the Business Associate Contract. On September
6, 2013, Defendant’s signatory executed that signature block and returned it to the Florida
Plaintiffs “believing and intending that he had executed the Florida Agreement with his
signature.” Defendant’s Memorandum In Support of Motion to Transfer by Corizon Health,
Inc. (“Def.’s Mem.”) at 3 n.2. Thus, Defendant returned a signed copy of the related Business
Associate Contract but did not provide a signed copy of the Florida Agreement from Defendant.
On September 6, 2013, Plaintiffs responded to Defendant’s earlier email, which requested the
inclusion of the 30-day grace period language. Plaintiffs’ response via email reads as follows:
I will have my legal department review the additional verbiage for this contract; I
will get it back as soon as possible. I do have a concem. In my Tallahassee
Branch I have been told from my manager there, that Corizon is hiring all
Nursefinder nurses and this contract has not been signed yet. In this contract we
gave you a 30day grace period to start after contract has been signed. I need
some clarification on this matter. Please advise.
Compl. ¶ 23.
Subsequently, Defendant hired fourteen (14) of the eighteen (18) nurses to work at
correctional facilities in Florida. Plaintiffs alleged that Plaintiffs “supplied its nursing personnel
to [Defendant] pursuant to the April Agreement. . . . [and Defendant] hired [Plaintiffs’] nursing
personnel on a permanent basis for employment, entitling [Plaintiffs] to the agreed-upon
Placement Fee.”

Id.¶¶ 36-37. 1

Plaintiffs further allege that they submitted invoices to

Defendant for placement fees owed and Defendant has failed to timely pay the balance. Id. ¶ 39.

1 Defendant argues that Plaintiffs “do not and cannot allege that any of the nurses [Defendant] hired
to work in Florida were either employed by any of the Virginia [Plaintiffs], or working or located in
Virginia at the time [Defendant] hired them.” Defendant’s Memorandum In Support of Motion to
3

II.

LEGAL STANDARD
Pursuant to 28 U.S.C. § 1404, “[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 or division
where it might have been brought.” 28 U.S.C. § 1404(a). “The decision whether to transfer an
action under the statute is committed to the sound discretion of the district court.” Heinz
Kettler GMBH & Co. v. Razor USA, LLC, 750 F. Supp. 2d 660, 668 (E.D. Va. 2010) (citing One
Beacon Ins. Co. v. JNB Storage Trailer Rental Corp., 312 F. Supp. 2d 824, 828 (E.D. Va. 2004)).
District courts determining whether to grant a motion to transfer under § 1404(a) to a transferee
forum where the action could initially have been brought “typically consider[]: (1) plaintiff’s
choice of forum, (2) convenience of the parties, (3) witness convenience and access, and (4) the
interest of justice.” Id. (citing JTH Tax, Inc. v. Lee, 482 F. Supp. 2d 731, 736 (E.D. Va. 2007)).
“The movant bears the burden of showing that transfer is proper.” JTH Tax, 482 F. Supp. 3d at
736 (citing Cognitronics Imaging Sys. v. Recognition Research, Inc., 83 F. Supp. 2d 689, 696
(E.D. Va. 2000)).

The party seeking transfer bears the burden of proving “that the

circumstances of the case are strongly in favor of transfer.” Jones v. Frazier, No. 1:09cv513,
2009 WL 2601255, at *8 (E.D. Va. Aug. 18, 2009) (emphasis added). “In considering a motion
for intra-district transfer, [courts] generally look to the same factors relevant to motions for
change of venue under 28 U.S.C. § 1404(a).” C.T. v. Liberal Sch. Dist., No. 06-2093-JWL, 2008
WL 489330, at *1 (D. Kan. Feb. 20, 2008).
III.

PARTIES’ ARGUMENTS
a. Defendant
Defendant argues that each prong of the test for transfer pursuant to section 1404(a) is

satisfied in this case. Defendant asserts that this action initially could have been brought in the
Transfer by Corizon Health, Inc. (“Def.’s Mem.”) at 4. Further, Defendant argues that “Plaintiffs also
do not appear to allege that [Defendant] hired any of the eighteen nurses outside of the 30-day grace
period.” Id.
4

Tallahassee Division of Northern District of Florida because Plaintiffs’ breach of contract claim
arises from actions occurring in Florida, and because Defendant—by virtue of allegedly
contracting with Florida to provide healthcare services to Florida’s correctional facilities and
hiring eighteen (18) nurses without paying buy-out fees—is subject to personal jurisdiction in the
transferee forum. Second, Defendant acknowledges that a plaintiff’s choice of forum is entitled
to deference, but argues that, here, Plaintiffs’ choice of forum in Virginia is not entitled to any
weight because the breach of contract claim has a weak connection to the forum. Defendant
argues that Plaintiffs cannot establish that the cause of action has a “legitimate connection to the
district” because of the following reasons: (1) the activity giving rise to Plaintiffs’ claims all
occurred in Florida; (2) none of the Virginia Plaintiffs are parties to the Florida Agreement; (3)
and none of the nurses hired by Defendant worked at any of the Virginia Plaintiffs. Def.’s Mem.
at 8 (quoting Pragmatus AV, LLC v. Facebook, Inc., 769 F. Supp. 2d 991, 995 (E.D. Va. 2011)).
Thus, Defendant argues that given the claim’s weak connection to Virginia, this Court should not
give this factor any weight.
Next, Defendant argues that transfer to the Tallahassee Division of the Northern District
of Florida is warranted because the transferee forum is more convenient for the parties and is
where the overwhelming majority of witnesses reside. Defendant asserts that convenience of
the parties weighs heavily in favor of transfer because none of the Virginia Plaintiffs are parties to
the Florida Agreement while the Florida Plaintiffs are indeed parties to the Florida Agreement.
Defendant additionally asserts that “hard copy documents are . . . located at [Defendant’s]
facilities in Florida.” Id. Furthermore, Defendant argues that the convenience to non-party
witnesses favors transfer because approximately twenty (20) critical witnesses for Defendant are
located in or near Florida. These non-party witnesses include eighteen nurses that Defendant
hired from the Florida Plaintiffs, with sixteen of them residing in Florida. Defendant asserts
that the non-party witnesses are a source of testimony evidence as they “can testify to the date
5

that [Defendant] hired them and the correctional facility where Defendant assigned them which
may be dispositive as to whether [Defendant] is liable under the Florida Agreement.” Id. at 9
(citing Courtney Decl. ¶¶ 4, 6-8). According to Defendant, the non-party witnesses include
various executives of Defendant, who will testify regarding Defendant’s contract discussions with
Plaintiffs, the staffing of the correctional facilities in Florida, and the lack of any complaints of
invoices from Plaintiffs until months after the nurses were hired. Id. According to Defendant,
because the vast majority of evidence and witnesses are located in or near the transferee forum,
the costs of attending trial in the Northern District of Florida would be minimal from both a time
and cost perspective. Further, Defendant argues that if this case proceeds in this Court, it is
likely that neither party would be able to compel the attendance of the Florida witnesses at trial
because the subpoena power granted under Federal Rule of Civil Procedure 45(c)(1) does not
extend to witnesses who live or work over 100 miles from the Eastern District of Virginia.
Finally, Defendant asserts that the interest of justice strongly favors transferring this action to
the Northern District of Florida because the transferee forum has a strong, legitimate, and
localized interest in the case.
For all these reasons, Defendant argues that transfer to the Tallahassee Division of the
Northern District of Florida is appropriate pursuant to 28 U.S.C. § 1404(a).
b. Plaintiffs’ Opposition
Plaintiffs only take issue with whether Defendant satisfies its burden to show that the
circumstances of the case “are strongly in favor of transfer.”

Plaintiffs’ Memorandum in

Opposition to Corizon Health, Inc.’s Motion to Transfer (“Pls.’ Opp’n.”) at 3. They note that
their choice of forum should be accorded deference and argue that such deference should be
substantial in light of the fact that this action was filed in their home forum. Say Plaintiffs, “The
April Agreement, as well as the Florida Agreement, were discussed and negotiated exclusively

6

between Grace Perkinson for Nursefinders in Virginia 2 and Ms. Christina Ray on behalf of
[Defendant].” Id. at 3 (emphasis in original). Moreover, Plaintiffs argue that Defendant’s
Motion is not well-grounded because “when and where the individual nurses were hired by
Defendant in Florida is not expected to be in dispute.” Id. at 1. Instead, they argue that “this
case turns entirely on what the respective corporate entities agreed to as the “operative”
contract.” Id.
Next, as to the convenience of the parties, Plaintiffs argue Virginia is clearly a more
convenient forum for Plaintiffs because it is the forum in which all its operations are managed
and where Ms. Perkinson is located. Plaintiffs argue that transfer is not appropriate where it
would merely shift the burden from Defendant to Plaintiffs.

Additionally, Plaintiffs

acknowledges that the convenience of witnesses is an important factor in the transfer calculus
and correctly notes that convenience to non-party witnesses is afforded greater weight than
convenience of party witnesses. In sum, Plaintiffs essentially argue that the relevance of each
potential witness and the importance of their live testimony should be considered by the Court.
Finally, with respect to the interests of justice, Plaintiffs argue that this Court has an interest in
providing a forum for its residents, that this District will resolve this action much more quickly
than the transferee forum will, and that the choice of law consideration weighs in favor or
maintaining the case in this Court. Specifically, they argue that, although several of the Florida
Plaintiffs are incorporated in Florida, they are operated out of the office of BK Development in
Midlothian, Virginia, and thus are entitled to treatment as a local business.
For all these reasons, Plaintiffs assert that Defendant fails to meet its burden to show that
the circumstances of this case strongly favor transfer.

2 Contrary to Plaintiffs’ assertion that Ms. Perkinson negotiated the Florida Agreement on behalf of
all the Plaintiffs, the names of the parties explicitly listed in that agreement are only those of the
Florida Plaintiffs. See Def.’s Mem. Ex. 2 at 4.
7

IV.

ANALYSIS
In assessing the relevant factors under 28 U.S.C. § 1404(a), the Count will now determine

whether Defendant meets its burden of proving “that the circumstances of the case are strongly
in favor of transfer.” Heinz, 750 F. Supp. 2d at 667 (quoting Jones v. Frazier, No. 1:09cv513,
2009 WL 2601355, at 8 (E.D. Va. Aug. 18, 2009) (emphasis added).
a. Transferee Forum as Initial Forum
Transfer is appropriate in those districts where the plaintiff could have properly filed the
action initially. See Hoffman v. Blaski, 363 U.S. 335, 343-44 (1960). The record indicates and
the parties do not dispute that this action could have been brought in the Tallahassee Division of
the Northern District of Florida.
b. Plaintiffs’ Choice of Forum
A plaintiff’s choice of forum is entitled to “‘substantial weight, especially where the
chosen forum is the plaintiff’s home forum or bears a substantial relation to the cause of action.”
Heinz, 750 F. Supp. 2d at 667 (citing Koh v. Microtek Int 7, Inc., 250 F. Supp. 2d 627, 633 (E.D.
Va. 2003)). This choice may “be overcome only when the private and public interest factors
clearly point toward trial in the alternative forum.” Piper Aircraft Co. v. Reyno, 454 U.S. 235,
255 (1981). However, the actual weight given to a plaintiff’s choice varies considerably “in
proportion to the connection between the forum and the cause of action.” GTE Wireless, Inc. v.
Qualcomm, Inc., 71 F. Supp. 2d 517, 519 (E.D. Va. 1999). The weight given to the plaintiff’s
initial choice is diminished when the operative facts of the case have little relation to the chosen
forum. Bd. of Trs. V. Sullivant Ave. Props., LLC, 508 F. Supp. 2d 473 (E.D. Va. 2007); see also
GTE Wireless, 71 F. Supp. 2d at 519 (“When a plaintiff chooses a foreign forum and the cause of
action bears little or no relation to that forum, the plaintiff’s chosen venue is not entitled to such
substantial weight.”) (citing Verosol B.V. v. Hunter Douglas Inc., 806 F. Supp. 582, 589 (E.D.
Va. 1992).
8

Plaintiffs’ entities are either located in Virginia (corporately) or managed in Virginia.
Therefore, Plaintiffs chose their home forum. As such, substantial deference is accorded to said
choice. Pursuant to the claims and allegations in the Complaint, the primary legal issue in the
instant case is which of the two contracts was operative at the time of the alleged breach of
contract. Indeed, both agreements were negotiated by Ms. Perkinson, who was located in
Virginia.
c. Convenience of the Parties and Non-Party Witnesses
1. Convenience to the Parties
In assessing this factor, courts generally consider “ease of access to sources of proof, the
cost of obtaining the attendance of witnesses, and the availability of compulsory process.”
Samsung, 386 F. Supp. 2d at 717 n.13. Convenience to parties alone will rarely justify transfer,
particularly where transfer would merely “‘shift the balance of inconvenience’ from defendant to
plaintiff.” Baylor, 702 F. Supp. at 1258 (quoting Eastern Scientific Marketing v. Tekna-Seal
Corp., 696 F. Supp. 173, 180 (E.D. Va. 1988)). However, “it is the ‘balance’ of convenience
which is in question,” and courts must determine whether the total convenience of the parties
favors transfer. Medicenters of Am., Inc. v. T & V Realty & Equip. Corp., 371 F. Supp. 1180,
1184 (E.D. Va. 1974) (citing Nizin v. Bright, 342 F. Supp. 489 (S.D.N.Y. 1971)).
Plaintiffs argue that transfer would merely shift inconvenience to them from Defendant.
The Court agrees with Plaintiffs in this regard. Virginia would clearly be more convenient for
Plaintiffs. However, transferring the case to Florida would simply flip the convenience of the
parties in favor of Defendant. In conclusion, Defendant has not established a strong reason to
transfer as to this factor.
2. Non-Party Witness Convenience
Witness convenience is of “considerable importance” in determining whether a transfer
pursuant to section 1404(a) is appropriate.

Samsung, 386 F. Supp. at 718.
9

“The party

asserting witness inconvenience has the burden to proffer, by affidavit or otherwise, sufficient
details respecting the witnesses and their potential testimony to enable the court to assess the
materiality of evidence and the degree of inconvenience.” comScore, Inc. v. Integral Ad Sci., Inc.,
924 F. Supp. 2d 677, 688 (E.D. Va. 2013) (quoting Samsung, 386 F. Supp. 2d at 718).
“Additionally, the moving party must demonstrate ‘whether that witness is willing to travel to a
foreign jurisdiction.’” Id. at 719 (quoting Thayer/Patricof Educ. Funding, LLC v. Pryor Res.,
Inc., 196 F. Supp. 2d 21, 33 (D.D.C. 2002)).
Defendant correctly notes that, in assessing this factor, courts draw a distinction between
party witnesses and non-party witnesses, giving less weight to inconvenience imposed on
party-witnesses. See Def.’s Reply at 7. Defendant identifies eighteen (18) nurses (who were
hired out of temporary to permanent status, all of whom live in or near Florida) as potential
witnesses. However, the relevant information regarding these nurses is if and when they were
hired by Defendant as permanent nurses and at what annual salary.

All of that relevant

information would likely be available in documentary form in the files of Defendant. Therefore,
this factor weighs in favor of Plaintiff.
d. Interests of Justice
In evaluating whether the interest of justice weighs in favor of transfer, the Court looks to
“the public interest factors aimed at systemic integrity and fairness.” Heinz Kettler, 750 F. Supp.
2d at 669-70 (quoting Byerson v. Equifax Info. Servs., LLC, 467 F. Supp. 2d 627, 635 (E.D. Va.
2006)). “The most prominent elements of systemic integrity are judicial economy and the
avoidance of inconsistent judgments.” Id. Similarly, “[f]airness is assessed by considering factors
such as docket congestion, the interest in having local controversies decided at home, knowledge
of applicable law, unfairness with burdening forum citizens with jury duty, and interest in
avoiding unnecessary conflicts of law.” Id.
This factor is a wash for several reasons. The Federal Courts in both Virginia and
10

Florida are quite capable of applying the appropriate states’ contract law and resolving the case
efficiently.
V.

CONCLUSION
Given the deference due to Plaintiffs’ choice of forum and Defendant’s failure to persuade

the Court that the relevant factors “strongly favor” transfer, the Motion to Transfer will be
DENIED. ECF No. 3.
Let the Clerk send a copy of this Memorandum Opinion to all counsel of record. An
appropriate Order shall issue.

____________________/s/_________________
James R. Spencer
Senior U. S. District Judge
ENTERED this _ 17th_

day of August 2015.

11