Allan Pollock, an officer, director, and shareholder of Estrella and Maquiladora, is similarly alleged to have made continuing misrepresentations from January 1996 to December 1996 to Elbeco's representatives that the contractual obligations would be met. Further, Pollock is alleged to have made misrepresentations in person to Elbeco's representative visiting the defendant corporations at their sites in Texas and Mexico.
The individual defendants all appear to play a significant role in the corporations, Estrella and Maquiladora, as officers, directors, and shareholders with apparent authority to commit the corporation to contracts and to represent the corporation in contractual discussions and obligations. Further, according to plaintiff's allegations, they appear to have played a significant role in the corporations' tortious conduct. Thus, we will consider their contacts with Pennsylvania in their corporate capacity in determining whether to exercise personal jurisdiction.
Under the flexible jurisdictional analysis, we find that the contacts between the individual defendants and Pennsylvania are sufficient minimum contacts to exercise personal jurisdiction. See Maleski, 653 A.2d at 63 (noting the "flexible" jurisdictional analysis). All of the individual defendants purposefully directed the alleged misrepresentations to a Pennsylvania corporation. Further, they had an ongoing series of misrepresentations with a Pennsylvania corporation for approximately one year. In making these misrepresentations these defendants purposefully reached into Pennsylvania through telephone and mail communications. Moreover, two of the individual defendants visited Pennsylvania and allegedly made misrepresentations while present in the forum. See National Precast Crypt, 785 F. Supp. at 1191 (finding that "if the corporate officer engages in tortious conduct in his/her corporate capacity in the forum, courts will consider this conduct as contact with the forum sufficient to support a finding of personal jurisdiction over the officer in his/her individual capacity"). Plaintiff's cause of action directly arises from these contacts with the forum. Thus, there are sufficient minimum contacts for this Court to exercise specific jurisdiction over the individual defendants.
b. Fair Play and Substantial Justice
For the second prong of the jurisdictional analysis, which is a determination of whether, once minimum contacts have been established, the exercise of jurisdiction comports with fair play and substantial justice, we will consider the corporate and individual defendants together. See International Shoe, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945). The Court in Burger King laid out the following factors to consider in the fairness analysis: "the burden on the defendant, the forum State's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief, the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and the shared interest of the several States in furthering fundamental substantive social policies." 471 U.S. at 477, 105 S. Ct. at 2184 (citations omitted). Analysis of these factors is discretionary. Mellon Bank, 960 F.2d at 1222. Generally, once the plaintiff makes out a prima facie case in favor of personal jurisdiction, "the defendant 'must present a compelling case that the presence of some other considerations would render jurisdiction unreasonable.'" Mellon Bank, 960 F.2d at 1226 (quoting Carteret Savings Bank v. Shushan, 954 F.2d 141, 150 (3d Cir. 1992)(quoting Burger King, 471 U.S. at 477, 105 S. Ct. at 2185)).
Defendant has not met this burden in the instant case. To demonstrate the unfairness of personal jurisdiction in Pennsylvania, defendants assert only that none of the defendants reside in Pennsylvania, that there are witnesses not located in Pennsylvania, and that there is demonstrative evidence in Texas and Mexico. (Def.'s Mem. at 11). In asserting such, defendants have not specifically identified any crucial witnesses who are not located in Pennsylvania, much less crucial witnesses who would refuse to come to Pennsylvania to testify. Nor have defendants indicated the substance of the testimony of these witnesses. See PPG Industries, 614 F. Supp. at 1164 (discussing necessity of indicating what the witnesses' testimony will cover in order for Court to balance the unfairness). Defendants have also not alleged the existence of any evidence that could not be brought to Pennsylvania. Further, this is not even a case where all the defendants' reside in the same state, since Estrella is a Texas corporation, Maquiladora is a Mexican corporation, David Katz resides in North Carolina, Morton Katz resides in Texas, and Allan Pollock resides in Georgia. As the Court stated in Burger King, "'modern transportation and communication have made it much less burdensome for a party sued to defend himself in a state where he engages in economic activity' [thus] it usually will not be unfair to subject him to the burdens of litigation in another forum for disputes relating to such activity." 471 U.S. at 474 (quoting McGee v. International Life Insurance Co., 355 U.S. 220 at 223, 2 L. Ed. 2d 223, 78 S. Ct. 199)).
Defendants knew they were involved with a Pennsylvania corporation and that the consequences of their actions would have ramifications in Pennsylvania. See PPG Industries, 614 F. Supp. at 1165. Further, if the allegations in plaintiff's complaint are proved at trial, defendants will have intentionally caused harm to a Pennsylvania resident through their contacts with Pennsylvania. See Kubik v. Letteri, 532 Pa. 10, 614 A.2d 1110, 1116 (Pa. 1992). When a Pennsylvania resident is injured in the Commonwealth, Pennsylvania has a strong interest in providing a forum for their resident and in having the responsible defendants accountable for their actions in Pennsylvania. See Grand Entertainment Group v. Star Media Sales, 988 F.2d 476 (3d Cir. 1993).
Accordingly, defendants have not presented this Court with compelling reasons why the exercise of specific jurisdiction would be inconsistent with standards of fair play and notions of substantial justice. There are sufficient minimum contacts to exercise specific jurisdiction and the exercise of specific jurisdiction comports with fair play and substantial justice. Therefore, defendants' Motion to Dismiss for lack of personal jurisdiction is denied.
Defendants assert that venue in the Eastern District of Pennsylvania is improper because the requirements of 28 U.S.C. § 1391(a) are not met. Plaintiff responds that venue is proper as a substantial part of the events giving rise to the claim occurred in this district and because defendants are subject to personal jurisdiction in this district. Title 28, United States Code, section 1391 provides that:
(a) A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated, or (3) a judicial district in which the defendants are subject to personal jurisdiction at the time the action is commenced, if there is no district in which the action may otherwise be brought.
28 U.S.C. § 1391(a).
Further, 28 U.S.C. § 1391(c) provides that a corporate defendant is "deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time the action is commenced." When a state has more than one district, the corporate defendant is "deemed to reside in any district in that State within which its contacts would be sufficient to subject it to personal jurisdiction." Id.
It appears that a substantial part of the events giving rise to the claim occurred in this District. Further, this Court has found that all of the defendants had sufficient contacts with this District to be subject to personal jurisdiction. Therefore, we find venue is proper in this District under 28 U.S.C. § 1391. Accordingly, Defendant's Motion to Dismiss for lack of venue is denied.
Defendants have also brought a Motion to Transfer this action to the Southern District of Texas pursuant to 28 U.S.C. § 1406, arguing that the original venue is improper and that the case should, therefore, be dismissed.
However, this Court has found that venue is proper in the Eastern District of Pennsylvania as the defendants are subject to personal jurisdiction here and as a substantial part of the events giving rise to the claim occurred here. Presumably, however, venue would be proper in the Southern District of Texas as well since the defendants would be subject to personal jurisdiction there given their corporate presence. Therefore, 28 U.S.C. § 1404 is the proper section for analyzing this Motion to Transfer, not § 1406. See Jumara v. State Farm Insurance Co., 55 F.3d 873, 878 (3d Cir. 1995)(discussing the difference between a § 1406 and a § 1404 analysis).
Title 28 of the United States Code section 1404(a), provides that "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." The district court has broad discretion to transfer an action, but "defendants have the burden of establishing its propriety." Tranor v. Brown, 913 F. Supp. 388, 391 (E.D. Pa. 1996)(citations omitted). See also PPG Industries, Inc. v. Systonetics, Inc., 614 F. Supp. 1161, 1163 (W.D. Pa. 1985). Further, although the decision to transfer is in the court's discretion, transfers should not be liberally granted. Vipond v. Consolidated Rail Corp., 1994 U.S. Dist. LEXIS 13898, 1994 WL 534808, *1 (E.D. Pa.). The transfer is not warranted if the effect is merely to shift the inconvenience from one party to the other. Id. at *2 (citing Kimball v. Schwartz, 580 F. Supp. 582, 588 (W.D. Pa. 1984)). Finally, "a party's choice of forum should not be lightly disturbed." PPG Industries, 614 F. Supp. at 1164.
In making the determination of whether a transfer is proper, the Court should "consider all relevant factors to determine whether on balance the litigation would more conveniently proceed and the interest of justice be better served by transfer to a different forum." Jumara v. State Farm Insurance Co., 55 F.3d 873, 879 (3d Cir. 1995)(citing 15 WRIGHT, MILLER & COOPER § 3847). Among the factors to be considered are 1) plaintiff's choice of forum; 2) defendant's preference; 3) residence of the parties; 4) convenience to the parties; 4) convenience to witnesses; 5) location of books and records; 6) practical considerations that could make the trial easier, more expeditious, or less expensive; 7) congestion of the possible fora; and 8) local interest in deciding local controversies. See Id. at 879-80.
Applying these principles to the instant case, this Court cannot find that defendants have met their burden of showing that transfer of this case to the Southern District of Texas will best serve the interests of convenience and justice. Among the facts supporting this conclusion are that at least two of the three individual defendants live in states other than Texas, making Pennsylvania just as convenient for those defendants. Further, defendants have not identified any witnesses or demonstrative proof that will only be available conveniently in the Southern District of Texas. See Vipond, 1994 U.S. Dist. LEXIS 13898, 1994 WL 534808 at *2 (denying motion to transfer, in part, because defendant failed to meet its burden in specifying the key witnesses to be called); PPG Industries, 614 F. Supp. at 1164 (finding that defendant should "make the necessary statements concerning what their [the witnesses] testimony will cover or demonstrate the materiality of such evidence such that this Court may properly balance the parties interests").
Pennsylvania has a strong interest in protecting its residents and providing a forum for resolution of their disputes. See Grand Entertainment Group v. Star Media Sales, 988 F.2d 476 (3d Cir. 1993). These interests have been implicated in this case as a Pennsylvania corporation has been allegedly injured through the acts of another who reached into Pennsylvania to cause this injury. Further, there has been no showing that the Southern District of Texas has a greater interest in resolving this case than the Eastern District of Pennsylvania or that they would be better able to "preserve the rights of the litigants." See Id. at 484.
Thus, given the information represented to the Court at this juncture, transferring this case to the Southern District of Texas would only serve to shift the inconvenience from defendants to plaintiff. Accordingly, defendants' Motion to Transfer is denied.
An appropriate Order follows.
AND NOW, this 29th day of December, 1997, upon consideration of Defendant's Motion to Dismiss for Lack of Personal Jurisdiction and Lack of Venue or in the alternative Motion to Transfer Venue and Plaintiff's Response thereto, it is hereby ORDERED that, for the reasons set forth in the foregoing Memorandum, the Motions are DENIED.
BY THE COURT:
J. CURTIS JOYNER, J.