Dominion Pipe & Piling v. City of Kodiak

Filing 29

ORDER denying City of Kodiak's 12 Motion to Change Venue by U.S. District Judge John C Coughenour.(RS)

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THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 9 DOMINION PIPE & PILING, 10 Plaintiff, 11 v. CASE NO. C16-1699-JCC ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE 12 CITY OF KODIAK, 13 Defendant. 14 DOMINION PIPE & PILING, 15 Third-Party Plaintiff, 16 v. 17 PACIFIC PILE & MARINE, L.P., et al., 18 Third-Party Defendants. 19 This matter comes before the Court on Defendant City of Kodiak’s motion to change 20 21 venue (Dkt. No. 12). Having thoroughly considered the parties’ briefing and the relevant record, 22 the Court finds oral argument unnecessary and hereby DENIES the motion for the reasons 23 explained herein. 24 I. BACKGROUND 25 Plaintiff Dominion Pipe and Piling, a division of Varstell USA Ltd., is a “supplier and 26 distributor of pipe and piling to construction companies and projects in North America” and does ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 1 1 business in the State of Washington. (Dkt. No. 1-2 at ¶ 1.1; Dkt. No. 9 at 4.) Defendant City of 2 Kodiak is a municipality located in the State of Alaska. (Dkt. No. 1-2 at ¶ 1.2.) In March 2014, 3 Kodiak entered into a written contract (the Contract) with Dominion for the manufacture and 4 delivery of pipe pile for use as structural support in a Kodiak construction project. (Id. at ¶ 3.2; 5 Dkt. No. 13-2 at 3.) Dominion claims that the Contract was “entered in Washington State and 6 delivery of the contracted-for product was to and did take place in King County, Washington.” 7 (Dkt. No. 1-2 at ¶ 2.2.) Kodiak denies Dominion’s allegation, (Dkt. No. 9 at ¶ 2.2), and claims 8 that the Contract was negotiated in Alaska, (Dkt. No. 12 at 6–7). 9 First, the product was manufactured in China and Third-Party Defendant Intertek Moody 10 International inspected the pipe for conformity to the Contract standards. (Id. at ¶ 3.3; Dkt. No. 11 15 at 6.) Then, Third-Party Defendant Tianjin Reda International Shipping Agency was 12 contracted to transport the product to British Columbia. (Id. at 6; Dkt. No. 2-2 at ¶ 3.3). Next, the 13 product was transported to Puyallup, Washington, where Third-Party Defendant Pacific Pile & 14 Marine, L.P., also Kodiak’s general contractor, contracted with Farwest to fabricate the pipe into 15 the lengths necessary for the project. (Id. at ¶ 3.4.) The product was then transported by truck to 16 Seattle and shipped to Kodiak by Third-Party Defendant Boyer Marine Service. (Id. at ¶ 3.5.) 17 Ultimately, Kodiak determined that the product was allegedly non-conforming and 18 brought a claim to the City Engineer, as required under the Contract. (Dkt. No. 1-2 at ¶ 3.6, 3.7.) 19 The City Engineer and Project Manager, Roe Sturgulewski, reviewed the claim and issued a 20 decision holding Dominion liable for the alleged damage caused by the increased cost to install 21 the product. (Dkt. No. 1-2 at ¶ 3.11; Dkt. No. 9 at 5–6.) 22 Dominion brought this matter for breach of contract and declaratory relief under its right 23 in the Contract to appeal the original decision to a “forum of competent jurisdiction.” 1 (Dkt. No. 24 1-2 at ¶ 3.12, 6–8.) Kodiak brought a counterclaim for breach of contract, (Dkt. No. 9 at 6), and 25 26 1 Kodiak removed the case to federal court from King County Superior Court. (Dkt. No. 1 at 1.) ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 2 1 Dominion brought a third-party complaint for negligence, contribution and indemnification, and 2 breach of contract against Pacific Pile & Marine, Intertek Moody, Tianjin Reda, and Boyer. (Dkt. 3 No. 15 at 5–8.) Kodiak now brings this motion for change of venue to the U.S. District Court for 4 the District of Alaska at Anchorage pursuant to 28 U.S.C. § 1404(a). (Dkt. No. 12.) 5 II. DISCUSSION 6 A. 7 Pursuant to 28 U.S.C. § 1404(a), the Court may transfer a civil action to any other district Change of Venue Standard 8 court in which the action may have been brought “[f]or the convenience of parties and witnesses, 9 in the interest of justice.” The Court must make an individualized, case-by-case determination of 10 convenience and fairness when considering a change in venue. Stewart Org., Inc. v. Ricoh Corp., 11 487 U.S. 22, 29 (1988). Factors that may be considered include: “(1) the location where the 12 relevant agreements were negotiated and executed, (2) the state that is most familiar with the 13 governing law, (3) the plaintiff’s choice of forum, (4) the respective parties’ contacts with the 14 forum, (5) the contacts relating to the plaintiff’s cause of action in the chosen forum, (6) the 15 differences in the costs of litigation in the two forums, (7) the availability of compulsory process 16 to compel attendance of unwilling nonparty witnesses, (8) the ease of access to sources of 17 proof”, (9) whether a forum selection clause is present, and (10) the relevant public policy of the 18 forum state. Jones v. GNC Franchising, Inc., 211 F.3d 495, 498–99 (9th Cir. 2000). “The 19 convenience of witnesses, particularly nonparty witnesses important to the resolution of the case, 20 is often cited as the most significant factor in ruling on a motion to transfer.”15 Fed. Prac. & 21 Proc. Juris. § 3851 (4th ed.); see, e.g., Getz v. Boeing Co., 547 F. Supp. 2d 1080, 1083 (N.D. Cal. 22 2008); Saleh v. Titan Corp., 361 F. Supp. 2d 1152, 1160 (S.D. Cal. 2005). 23 The moving party has the burden of showing that the overall convenience of the parties 24 and witnesses, in the interests of justice, weighs in favor of transferring the action. See Decker 25 Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir. 1986). “[U]nless the balance 26 of factors is strongly in favor of the defendants, the plaintiff’s choice of forum should rarely be ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 3 1 disturbed.” Sec. Inv’r Prot. Corp. v. Vigman, 764 F.2d 1309, 1317 (9th Cir. 1985) (emphasis 2 added). Further, a defendant has to do more than demonstrate that the transfer “merely shift[s] 3 inconvenience” from one party to another. Nike, Inc. v. Lombardi, 732 F. Supp. 2d 1146, 1158 4 (D. Or. 2010) (citing Decker, 805 F.2d at 843). 5 B. 6 Analysis 1. Appropriate District Court 7 The parties do not dispute that Dominion could have brought the action in the U.S. 8 District Court for the District of Alaska. (Dkt. No. 12 at 5; see generally Dkt. No. 21.) The Court 9 agrees that the District Court in Alaska would have been an appropriate forum. 10 2. Convenience and Interest of Justice Factors 11 Location Where the Agreement was Negotiated and Executed: Kodiak argues that the 12 Contract was negotiated in Alaska because the bid was submitted to the City Manager’s office in 13 Kodiak and the terms were negotiated from the parties’ respective locations in Canada and 14 Alaska. (Dkt. No. 12 at 6–7.) Kodiak also claims that the Contract was executed when the pipe 15 piles were fabricated in China then transported from Seattle to Kodiak. (Id. at 7.) However, 16 Dominion argues that it negotiated the Contract from its Washington offices and performed its 17 obligations under the Contract by delivering the pipe to Kodiak in Seattle. (Dkt. No. 21 at 6–7.) 18 The Court concludes that the Contract was negotiated in Alaska and Washington, but was 19 executed in Washington. Therefore, this factor weighs in favor of denying the motion to change 20 venue. 21 State Most Familiar with Governing Law: The Contract provides that all disputes arising 22 under the contract will be governed by the law of “the State in which the Point of Destination 23 [Seattle] is located.” (Dkt. No. 13-2 at 18.) As such, Washington law will govern this dispute. 24 Kodiak argues that the Uniform Commercial Code (UCC), which has been adopted by both 25 Alaska and Washington, governs this case. (Dkt. No. 12 at 8.) However, this bears no weight on 26 the Court’s analysis because each state may interpret the UCC with subtle distinctions and the ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 4 1 Contract is clear that Washington law governs any dispute. Therefore, this factor weighs in favor 2 of denying the motion to change venue. 3 Plaintiff’s Choice of Forum: Although Dominion originally filed in Washington state 4 court (Dkt. No. 1-2) and this action was removed to federal court (Dkt. No. 1), the Court still 5 finds Dominion’s choice to file in Washington, rather than Alaska, persuasive in this analysis. 6 See Sec. Inv’r Prot. Corp., 764 F.2d at 1317. Moreover, Dominion is headquartered in 7 Washington and performed its contract obligations in Washington. Therefore, this factor heavily 8 weighs in favor of denying the motion to change venue. Id. 9 Parties’ Contacts with Washington: Kodiak, as an Alaskan municipality, does not have 10 strong contacts with Washington. (Dkt. No. 12 at 8–9.) On the other hand, Dominion has a 11 “principal base of operations” in Washington and therefore many contacts with the state. (Dkt. 12 No. 21 at 10.) Pacific Pile & Marine is a Delaware corporation with a principal place of business 13 in Washington. (Dkt. No. 15 at 5.) Intertek Moody and Tianjin Reda are Chinese corporations 14 conducting business in Washington. (Id.) Boyer is an Alaska corporation conducting business in 15 Washington. (Id.) Taken together, the parties cumulatively have many contacts with Washington. 16 Therefore, this factor weighs in favor of denying a motion to change venue. 17 Cause of Action Contacts with Washington: Although the pipes were fabricated in China, 18 the Contract was indisputably performed in Washington. (Dkt. No. 13-2 at 3.) Kodiak argues that 19 the transfer of custody of the pipes to Kodiak in Seattle makes the contact “minimal.” (Dkt. No. 20 12 at 9.) The Court disagrees. Although Kodiak installed the pipe in Alaska and discovered it 21 was allegedly nonconforming in Alaska, the cause of action itself is centered in Washington 22 where the Contract was performed. Moreover, Kodiak’s own general contractor, Pacific Pile & 23 Marine, hired a subcontractor to fabricate the pipe into the lengths needed for the project in 24 Washington. (Dkt. No. 2-2 at ¶ 3.4.) 25 However, Dominion also claims that Pacific Pile & Marine, when installing the pipe in 26 Alaska, negligently caused the damages alleged by Kodiak when it used “drilling equipment with ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 5 1 the pipe that was not compatible with the pipe.” (Dkt. No. 15 at 8.) This means that the cause of 2 action also has strong contacts in Alaska. Therefore, this factor is neutral and does not favor 3 denying or granting the motion to change venue. 4 Litigation Costs: Kodiak argues that the cost of litigation in Washington would be far 5 greater than the cost of litigation in Alaska because Anchorage witnesses will have to be flown to 6 Seattle for trial and Seattle attorneys are much more expensive than Anchorage attorneys are. 7 (Dkt. No. 12 at 10–11.) However, if the case is transferred, the cost of witness travel merely 8 shifts to Dominion. Further, the difference in attorney costs is not significant, as Kodiak has had 9 multiple Alaska attorneys admitted pro hac vice, and the location of counsel is not a factor in the 10 Court’s analysis. See FieldTurf USA, Inc. v. Blue Sky Int’l, Inc., 2012 WL 4510671, at *4 (E.D. 11 Cal. Sept. 30, 2012). Therefore, this factor weighs in favor of denying the motion to change 12 venue. 13 Nonparty Witnesses: Although this factor is often the most important, “the Court must 14 consider not simply how many witnesses each side has and the location of each, but, rather, the 15 Court must consider the importance of the witnesses.” Saleh v. Titan Corp., 361 F. Supp. 2d 16 1152, 1160–1161 (S.D. Cal. 2005); see Gates Learjet Corp. v. Jensen, 743 F.2d 1325, 1335–36 17 (9th Cir. 1984). Further, the fact that a nonparty witness may be beyond the Court’s subpoena 18 power often favors transfer. See Saleh, 361 F. Supp. 2d at 1165–66; Leyvas v. Bezy, 2008 WL 19 2026276, at *4 (D. Ariz. 2008). 20 Kodiak originally claimed that there are six nonparty witnesses located in Alaska, two in 21 Washington, and three elsewhere. (Dkt. No. 12 at 9–10; 11.) The addition of the Third-Party 22 Defendants, however, gives the District Court in Alaska subpoena power over all of the nonparty 23 witnesses at issue except for one located in Arizona. Moreover, Kodiak argues, the most 24 important nonparty witness, the City Engineer and Project Manager for the project who issued 25 the original decision holding Dominion liable for damages, is located in Alaska. (Id. at 10.) The 26 chief engineer, Bryan Hudson, and the firm that analyzed the project for Kodiak following the ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 6 1 installation difficulties, R&M Construction, are both located in Alaska, as well. (Id.) The Court 2 concludes that these three nonparty witnesses that are not under its own subpoena powers, but 3 would be under the District Court in Alaska’s subpoena powers, are important witnesses to this 4 case. Therefore, this factor weighs in favor of granting the motion to change venue. 5 Sources of Proof: The parties agree that this factor plays an almost nonexistent role here 6 because most of the discovery documents are now in both parties’ custody and control. (Dkt. No. 7 12 at 11; Dkt. No. 21 at 13.) Therefore, this factor minimally weighs in favor of denying the 8 motion to change venue. 9 Forum Selection Clause: There was no forum selection clause in this matter, therefore, 10 this factor is not relevant to the motion to change venue. 11 Public Policy: Kodiak argues that because the project was funded with Alaska state 12 money and its purpose was to serve the people of Kodiak and the State of Alaska, the 13 administration of justice is better served in Alaska. (Dkt. No. 12 at 12.) Dominion counters that it 14 could be seen as an “outsider” in Alaska, which makes Washington a better forum. (Dkt. No. 21 15 at 13.) The Court agrees with Kodiak and finds Dominion’s arguments unpersuasive. The 16 Alaskan public funds and public interest aspect of this case leads the Court to conclude that this 17 factor weighs in favor of granting the motion to change venue. 18 Overall, there are only two factors that weigh in favor of granting the motion to change 19 venue: nonparty witnesses and public policy. However, although the nonparty witnesses factor is 20 often the most important, the Court concludes that it does not save this motion because Kodiak 21 has not made a showing that balance of the factors strongly favors transfer. Moreover, the 22 nonparty witnesses can be deposed in Alaska and the depositions can be presented as evidence to 23 this Court in Washington. Dominion’s choice of forum should be preserved and this motion to 24 change venue is DENIED. 25 III. CONCLUSION 26 For the foregoing reasons, Kodiak’s motion to change venue (Dkt. No. 12) is DENIED. ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 7 1 DATED this 5th day of January 2017. 2 3 4 A 5 6 7 John C. Coughenour UNITED STATES DISTRICT JUDGE 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDER DENYING CITY OF KODIAK’S MOTION TO CHANGE VENUE PAGE - 8

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