District Court for the District of Massachusetts. While the reasons accompanying defendants' motion are indeed persuasive, after balancing and weighing all the relevant criteria, the Court nonetheless concludes that the inconveniences to defendants presented by this litigation are not so insuperable that they warrant a transfer.
The four plaintiffs in this action are private individuals who reside and are employed in the Eastern District of Pennsylvania. Defendant American Snacks, Inc. ("ASI") is a Delaware corporation, having its principal place of business in Chelsea, Massachusetts. ASI primarily operates "fast food" restaurants throughout the country, maintaining, among other places, 42 units in Massachusetts, 34 units in Florida, 30 units in Ohio, and 30 units in Illinois. For the nine months ending in September 1973, ASI had 14 of its total 305 units, or 4.59%, in Pennsylvania; generated in Pennsylvania $835,257 of the aggregate volume of business of $15,597,825, or 5.35%; and employed here in the Commonwealth 122 persons out of 2,114, or 5.77%. Defendant Touche Ross & Co. ("Touch Ross") is an international firm of certified public accountants which does substantial business in the Eastern District of Pennsylvania.
Plaintiffs' claims in the litigation arise out of their purchase from ASI in March 1969, of twenty-five debentures, each one having a face value of $1,000, bearing 6% interest annually, and maturing in 1989. The complaint alleges that ASI's offering prospectus was misleading in that, among other things, the prospectus (1) overstated the value of the assets; (2) misrepresented the character of the assets; and (3) inflated the earnings of ASI in previous years. Touch Ross was the accounting firm responsible for certifying the financial statements of ASI.
On October 3, 1969, ASI allegedly issued a "News Release," where it was reported that ASI would "write off" $1,100,000 of corporate assets "net of taxes" which was based upon a reevaluation of the assets. Consequently, the debentures earlier offered, dropped substantially in value. Twenty of plaintiffs' twenty-five debentures were thereafter sold for approximately $500 per debenture, or 50% of their original investment. By this action plaintiffs seek, inter alia, a rescission of the sale of the remaining five debentures which they retain, and compensatory damages for the loss incurred by their past sale of the debentures at a reduced value.
It appears from the record that the twenty-five debentures were purchased through the Trenton, New Jersey office of Merrill, Lynch, Pierce, Fenner & Smith ("Merrill, Lynch") by plaintiff Cletus M. Lyman for his children at a time when he resided in Hazelton, Pennsylvania, which is not within the Eastern District of Pennsylvania. The Merrill, Lynch stockbroker who sold the debentures lives in Bucks County, Pennsylvania, which is within the Eastern District of Pennsylvania.
28 U.S.C. § 1404 provides in relevant part:
"(a) For 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."