United States District Court, M.D. Pennsylvania
September 30, 2005.
CLAIRE STONER, Plaintiff
ARTS UNIQ, INC., Defendant.
The opinion of the court was delivered by: SYLVIA RAMBO, Senior District Judge
Before the court are Defendant's motions to dismiss, or in the
alternative to transfer the case. (Doc. 6.) The parties have
briefed the issues, and the matter is ripe for disposition. For
the reasons that follow, Defendant's motion will be Denied.
Plaintiff Claire Stoner is an artist domiciled in New Freedom,
Pennsylvania. (Compl. ¶ 3.) Defendant Arts Uniq, Inc., a
Tennessee corporation, represents and promotes artists and
artworks. (Id. ¶ 4.) Defendant represents many artists in the
Commonwealth of Pennsylvania; Pennsylvania artists comprise over
10% of Defendant's client base. (Def.'s Reply Br. 4.) Defendant
also enters into sales agreements with art dealers; sales to
dealers in Pennsylvania comprise about two percent of Defendant's
total sales. (Id.) Defendant advertises on its website that it
has a business relationship with nearly 600 art dealers in
Pennsylvania. (Pl.'s Br. in Opp'n 5; Doc. 15.) Plaintiff entered into an agreement with Defendant on January
30, 2003 to represent Plaintiff and her works. (Compl. ¶ 6.)
Defendant advised Plaintiff that she could terminate the
agreement unilaterally. (Id. ¶ 8.) On November 1, 2004,
Plaintiff terminated her contractual relationship with Defendant.
(Id. ¶ 7.) At that time, Plaintiff learned that Defendant had
entered into long-term contracts on her behalf, and that some of
these agreements ran for as much as two years past the date of
termination. (Id. ¶¶ 11-20.) According to Plaintiff, she had
not been informed of the length of these contracts. (Id. ¶¶ 14,
16, 18, 20.) Plaintiff asserts that Defendant continues to
collect royalties on the sales of her work. (Id. ¶ 26.)
Plaintiff believes that these royalties have amounted over
$100,000 to date, and that they could amount to $150,000 over the
life of these long-term contracts. (Id. ¶¶ 27, 30.)
Plaintiff filed a Complaint alleging breach of contract on May
2, 2005, asking the court to enjoin the Defendant from acting as
Plaintiff's agent and collecting royalties from that
representation. (Id. ¶ 30.) She also seeks damages for those
royalties that have been diverted to Defendant after the
termination of their agreement. (Id.) Defendant filed a motion
to dismiss pursuant to Rule 12(b)(2) and 12(b)(3) of the Federal
Rules of Civil Procedure on August 25, 2005. In that motion,
Defendant also moved for a change of venue pursuant to
28 U.S.C. § 1404.
A. Personal Jurisdiction
Rule 12(b)(2) of the Federal Rules of Civil Procedure allows a
defendant to challenge the court's right to exercise personal
jurisdiction over him. The defendant bears the initial burden of
rasing a lack of jurisdiction. Carteret Sav. Bank, F.A. v. Shushan, 954 F.2d 141, 146 (3d Cir. 1992). The
burden then shifts to the plaintiff to establish that the
exercise of personal jurisdiction over the defendant is proper.
Id. The plaintiff must "establish jurisdictional facts through
sworn affidavits or other competent evidence." Time Share
Vacation Club v. Atl. Resorts, 735 F.2d 61, 66 n. 9 (3d Cir.
1984). "[A]t no point may a plaintiff rely on the bare pleadings
alone in order to withstand a defendant's Rule 12(b)(2) motion
for lack of in personam jurisdiction." Id. The plaintiff need
only make a prima facie showing of personal jurisdiction if there
has been limited discovery or no evidentiary hearing.*fn1
Carteret, 954 F.2d at 142. After a prima facie case has been
made, the plaintiff must still establish personal jurisdiction by
a "preponderance of the evidence." Id.
Pursuant to Rule 4(e) of the Federal Rules of Civil Procedure,
a federal court may exercise personal jurisdiction over
non-residents "to the extent permissible under the law of the
state where the district court sits." Mellon Bank (East) PSFS v.
Farino, 960 F.2d 1217, 1221 (3d Cir. 1992). Pennsylvania's long
arm statute extends personal jurisdiction to the fullest extent
allowed under the United States Constitution.
42 Pa. C.S.A. § 5322(b). Thus, the long-arm statute is limited only by the Due
A district court may assert personal jurisdiction over a
non-resident defendant when the defendant's "conduct and
connection with the forum state are such that he should
reasonably anticipate being haled into court there." World Wide
Volkswagon Corp. v. Woodson, 444 U.S. 286, 297 (1980). Where a
defendant "purposefully avails himself of the privilege of
conducting activities within the forum state," the defendant is on notice that he is subject to suit in
that state. Id.; Hanson v. Denkla, 357 U.S. 235, 253 (1958).
This analysis centers on "whether the defendant has purposefully
directed his activity toward the forum state." Burger King Corp.
v. Redzewicz, 471 U.S. 462, 472 (1985).
The court exercises specific jurisdiction over a defendant
where the suit arises out of or is related to the defendant's
contacts with the forum state. Helicopteros Nacionales de
Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 8 (1984). If the
suit does not arise out of defendant's contacts with the forum
state, the court may exercise general jurisdiction if the
defendant's contacts are "continuous and systematic." Id. at
Defendant contends that because the agreement between the
parties was concluded from Defendant's place of business in
Tennessee, and because the agreement is governed by Tennessee
law, Plaintiff cannot establish that Defendant had sufficient
contact with Pennsylvania. However, Defendant admits having
continual intentional contact with Pennsylvania. From at least
2003, Defendant has earned between one and two percent of its
total annual sales income from Pennsylvania dealers. (Def.'s
Reply Br. 4.) It has represented Pennsylvania artists during that
length of time as well; over ten percent of Defendant's client
base is comprised of Pennsylvania artists. (Id.) Defendant also
advertises on its website that it has business relationships with
nearly 600 art dealers in Pennsylvania. (Pl.'s Br. in Opp'n 5;
Doc. 15.) Many of these dealers are located in the Middle
District of Pennsylvania.
Defendant has maintained continuous contact with the
Commonwealth of Pennsylvania over a period of at least three
years. Defendant purposefully directed his activities toward the Commonwealth by entering into business
relationships with artists and art dealers in Pennsylvania. By
these contacts, Defendant is on notice that it could be haled
into court by any one of these artists they represent or dealers.
Thus, it is not unfair to assert personal jurisdiction over
Defendant here. Because the court finds that general personal
jurisdiction over Defendant is proper, the court need not
determine whether the claim itself arises out of Defendant's
contact with the forum state. The court will deny Defendant's
motion to dismiss for lack of personal jurisdiction.
B. Improper Venue
Rule 12(b)(3) allows a defendant to bring a motion to dismiss
for improper venue pursuant to 28 U.S.C. § 1406(a). Defendant
bears the burden of establishing improper venue. Myers v.
American Dental Assn., 695 F.2d 716, 724 (3d Cir. 1982). Venue
is conferred by 28 U.S.C. § 1391, which provides that
[a] civil action wherein jurisdiction is founded only
on diversity of citizenship may, except as otherwise
provided by federal 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 the property that is the subject
of the action is situated, or (3) any judicial
district in which any defendant is subject to
personal jurisdiction at the time the action is
commenced, if there is no district in which the
action may otherwise be brought.
A corporate defendant is deemed to reside "in any judicial
district in which it is subject to personal jurisdiction."
28 U.S.C. § 1391(c). Additionally, as Pennsylvania has three
judicial districts, Defendant must have had sufficient contacts
with the Middle District of Pennsylvania to give rise to personal
jurisdiction in the district. Id. Defendant's only argument is that the contract and a
substantial amount of the acts under it occurred in venues other
than the Middle District. (Br. in Supp. at 4.) This argument
would be valid if venue were conferred on the basis of the second
subpart of Section 1391(a). However, venue may be conferred by
the first subpart as well. Because Defendant is a corporation, it
is deemed to reside in any judicial district in which it is
subject to personal jurisdiction. Thus, if Defendant is subject
to personal jurisdiction in the Middle District of Pennsylvania,
it is deemed to reside here for the purposes of venue.
Because the court has determined that Defendant is subject to
personal jurisdiction in Pennsylvania generally, Defendant must
show improper venue by showing that he would not be subject to
personal jurisdiction in the Middle District of Pennsylvania.
Defendant has not shown any evidence on that point. On the
contrary, Plaintiff has shown that Defendant has numerous
business relationships with art dealers situated in the Middle
District. Therefore, venue is proper under 28 U.S.C. § 1391.
Defendant's motion to dismiss for improper venue will be denied.
C. Change of Venue
The applicable statute for change of venue is
28 U.S.C. § 1404(a). Section 1404(a) provides that "[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." This statute provides
district courts with discretion to transfer a civil action "if
the transfer is warranted by the convenience of parties and
witnesses and promotes the interests of justice." Van Dusen v.
Barrack, 376 U.S. 612, 616 (1964). Stated differently, "the
purpose of [§ 1404(a)] is to prevent the waste of time, energy,
and money and to protect litigants, witnesses and the public against unnecessary inconvenience and expense." Id.
(internal quotations omitted). Although the court has discretion
to transfer venue, "a motion to transfer is not to be liberally
granted." Measurement Specialties, Inc. v. Stayhealthy.com,
275 F. Supp. 2d 638, 640 (E.D. Pa. 2003). If the plaintiff has chosen
his home forum, that choice "will not be disturbed unless the
balance tilts strongly in favor of transfer." See Reed v. Weeks
Marine, Inc., 166 F.Supp. 2d 1052, 1057 (E.D. Pa. 2001).
As a threshold question, the court must determine whether the
action "might have been brought" in the proposed transferee
district. Id. at 616-17. 28 U.S.C. § 1391(c) provides that
"[f]or purposes of venue . . . a defendant that is a corporation
shall be deemed to reside in any judicial district in which it is
subject to personal jurisdiction. . . ." Defendant is a Tennessee
corporation, the contact at issue was signed in Tennessee, and
Tennessee law applied to the contract. Thus, the court finds that
a district court in Tennessee could properly exercise personal
jurisdiction over Defendant. Accordingly, venue would also be
proper. However, the court's analysis does not end with this
Because the action could have been brought in the proposed
transferee district, the court must now weigh a list of factors.
While there is no definitive list of factors, courts generally
consider the following interests: (1) the plaintiff's choice of
forum; (2) the defendant's preference; (3) where the claim arose;
(4) the convenience of the parties; (4) the convenience of the
witnesses, but only to the extent that the witnesses may actually
be unavailable for trial in one of the fora; (5) the location of
books and records, similarly limited to the extent that the files
could not be produced in the alternative forum; (6) the
enforceability of the judgment; (7) practical considerations that could make the trial easy, expeditious, or
inexpensive; (8) the relative court congestion in the competing
courts; (9) the local interest in deciding local controversies at
home; (10) the public policies of the fora; (11) and the
familiarity of the trial judge with the applicable state law.
Jumara v. State Farm Ins. Co., 55 F.3d 873, 879-80 (3d Cir.
1995). The burden of showing that these factors warrant transfer
rests with the moving party. Id. at 879.
Defendant argues that because the agreement was executed in
Tennessee and is governed by Tennessee law, and because the sales
and licensing for Plaintiff's artwork "occurred mostly outside
Pennsylvania," the case should be transferred to the "appropriate
District Court in Tennessee." (Br. in Supp. at 2.) It is true
that familiarity of the trial judge with the applicable law is a
consideration. However, Plaintiff's choice of forum is a stronger
one. Defendant's contention that many of the sales and licenses
that are the basis of this suit arose outside of Pennsylvania is
not relevant to this discussion, because Defendant does not
connect them to Tennessee. Additionally, the court considers the
inconvenience to both parties. Clearly either party would suffer
some inconvenience by having to litigate the claims in a foreign
district. Thus, the court finds that these factors essentially
balance each other out. As to the other factors listed above,
Defendant has not identified any additional factors that weigh in
favor of a change in venue Therefore, Defendant has not shown
that Tennessee is a better forum than Pennsylvania for the
disposition of this suit. Because Plaintiff has chosen her home
forum, Defendant must show that the factors in favor of a
transfer weigh strongly in Defendant's favor. Because the factors
identified by Defendant do not outweigh Plaintiff's strong interest in maintaining the action in the Middle District, the
court will not change the venue of this case to a district court
For the reasons stated above, Defendant's motion to dismiss for
lack of jurisdiction and improper venue will be denied.
Additionally, the court will deny Defendant's motion to change
venue in this case. An appropriate order will issue. ORDER
In accordance with the accompanying memorandum of law, IT IS
HEREBY ORDERED THAT:
1) Defendant's motion to dismiss for lack of
jurisdiction is DENIED.
2) Defendant's motion to dismiss for improper venue
3) Defendant's motion to change venue is DENIED.
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