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BRITAMCO UNDERW. v. RAYMOND E. WALLACE

June 22, 1999

BRITAMCO UNDERWRITERS, INC.
v.
RAYMOND E. WALLACE SPECIAL PRODUCTIONS, INC.



The opinion of the court was delivered by: Joyner, District Judge.

MEMORANDUM AND ORDER

This is a declaratory judgment action brought by the plaintiff, Britamco Underwriters, Inc. ("Britamco") against the defendant, Raymond E. Wallace Special Productions, Inc. ("Wallace") to resolve coverage issues of a marine liability insurance policy that Britamco issued to Wallace. Before the court is Wallace's Motion to Dismiss for Improper Venue pursuant to Federal Rule 12(b)(3) of Civil Procedure, or alternatively Motion to Transfer for Improper Venue pursuant to 28 U.S.C. § 1406(a) and/or Motion to Transfer pursuant to 28 U.S.C. § 1404(a). For the following reasons, the motions will be denied.

Factual Background

On August 24, 1998 Britamco filed suit seeking to determine whether Britamco is required to provide coverage to Wallace on a marine liability insurance policy. Wallace "specifically purchased the . . . policy for the express purpose of obtaining coverage with respect to the work that Wallace did in connection with the MOSHULU." (Def.'s Mem. at 18).*fn1 The MOSHULU is an historic sailing vessel in Philadelphia that was renovated in part by Wallace. Wallace's work allegedly caused some property losses. As a result of these losses, the owners of the MOSHULU, HMS Ventures, Inc. sued Wallace and others involved in the work on the MOSHULU.

Discussion

I. Venue

Wallace moves to dismiss under Federal Rule 12(b)(3) of Civil Procedure or transfer under 28 U.S.C. § 1406(a) the Complaint for improper venue arguing that this court is an improper venue pursuant to 28 U.S.C. § 1391(a)(2). Because Britamco invokes the court's admiralty jurisdiction,*fn2 however, the requirements for proper venue are found in 28 U.S.C. § 1391(b). Section 1391(b) states in pertinent part that "[a] civil action . . . may, except as otherwise provided by law, be brought only in . . . (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred[.]. . ."*fn3

Venue is determined by focusing on the location of those "events or omissions giving rise to the claim," rather than the defendant's "contacts with a particular district." See Cottman Transmission Sys. v. Martino, 36 F.3d 291, 294 (3d Cir. 1994). The court is not required to select the best forum. Id. However, the substantiality requirement of Section 1391(b)(2) exists "to preserve the element of fairness so that a defendant is not haled into a remote district having no real relationship to the dispute." Id. To determine whether an act or omission giving rise to the claims is "substantial," the court must look at the nature of the dispute. See Id.

Here Britamco seeks a declaratory judgment that Britamco has no duty to indemnify or defend [Wallace] "in connection with any claims or losses set forth by HMS Ventures, Inc. . . ." (Complaint at 10). Britamco alleges that to procure the insurance policy, Wallace concealed the true nature and scope of its activities and the contract with HMS Ventures, Inc., committed material misrepresentations and breached the duty of good faith and fair dealing. See (Complaint ¶ 12). Britamco further claims that "the terms, conditions and exclusions of the policy also establish that there is no coverage for losses alleged by HMS Ventures, Inc. against Wallace." (Complaint ¶ 24).

The alleged acts of misrepresentation and concealment apparently did not occur in this district but a district in California since Wallace, a California corporation, purchased the insurance policy from an insurance broker in California. See (Complaint ¶ 2; Ex. C). However, the policy was procured to specifically cover Wallace's work on the MOSHULU in Philadelphia. The losses for which Wallace was alleged to be liable occurred in Philadelphia. Furthermore, the suit against Wallace for these losses was filed in this district.

Wallace argues that venue is improper because it is a California corporation with its principal place of business in California, the insurance policy application was completed in California, the insurance broker through which Wallace purchased the insurance policy is located in California and Britamco is not a Pennsylvania corporation. As Britamco correctly points out, however, "[t]he creation of the contract . . . is but one event in a series of events which give rise to this action." Cornell & Co., Inc. v. Home Ins. Companies, No. CIV.A. 94-5118, 1995 WL 46618 at *6 (E.D.Pa. Feb. 6, 1995). Other events giving rise to this action include: (1) Wallace's work on the MOSHULU in Philadelphia, (2) the property losses of the MOSHULU in Philadelphia and (3) the ensuing suit filed in this district by HMS Ventures, Inc. against Wallace. It is clear that these events are more than tangential to the dispute. Therefore, since this forum has a real relationship to the action and a substantial part of the events which led to this action occurred here, it is fair to hale Wallace into this district.

II. Convenience of Forum

Wallace also moves to transfer the case from this district as an inconvenient forum pursuant to 28 U.S.C. § 1404(a). That statute provides:

  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
  ...

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