United States District Court, W.D. Pennsylvania
November 22, 2005.
FRESHTEC FOOD PROCESSING, EQUIPMENT INTERNATIONAL, LLC, Plaintiff,
EASY TRAY, LLC, Defendant.
The opinion of the court was delivered by: KIM GIBSON, District Judge
MEMORANDUM OPINION AND ORDER
This case comes before the Court on Defendant's Motion to
Dismiss or Transfer Venue Pursuant to 28 U.S.C. § 1404. (Document
No. 6). Upon consideration of the record in the case sub
judice, the Defendant's unopposed motion, and the governing
legal principles set forth in 28 U.S.C. § 1404, the Court shall
grant in part and deny in part the Defendant's Motion to Dismiss
or Transfer Venue Pursuant to 28 U.S.C. § 1404 for the following
Jurisdiction is proper in the United States District Court for
the Western District of Pennsylvania pursuant to
28 U.S.C. § 1332, in that all parties to the above-captioned civil action are
citizens of different states, and the subject matter in
controversy exceeds the sum or value of $75,000.00, exclusive of
interest and costs. Specifically, Plaintiff is a Limited
Liability Company organized under the laws of the Commonwealth of
Pennsylvania with its principle place of business in
Pennsylvania, and Plaintiff seeks damages in excess of
$75,000.00, exclusive of interest and costs. Additionally, the
Defendant is a Limited Liability Company organized under the laws
of the State of South Carolina with its principal place of
business in South Carolina. BACKGROUND*fn1
The Plaintiff commenced the above-captioned civil action in the
Court of Common Pleas for the County of Clearfield, Commonwealth
of Pennsylvania, with the issuance of a Writ of Summons followed
by the filing of a Summons and Complaint on January 18, 2005.
(Document No. 1).
On or about May of 2003, the Defendant, "a newly formed South
Carolina limited liability company," attempted to locate sources
for production equipment for its anticipated operations.
(Document No. 6, Exhibit A.). One of the companies identified
during the Defendant's search was Backus USA, Inc.*fn2
(hereinafter "Backus USA"), "a food processing equipment supplier
with representatives in North Carolina and Pennsylvania." Id.
After initiating contact with Backus USA, a representative from
Backus USA traveled to South Carolina to meet with personnel from
the Defendant company. At that time, Backus USA provided to the
Defendant estimated costs on various pieces of equipment. Id.
Over the next several months, Backus USA actively sought the
Defendant's business by continuing to meet with Defendant
personnel in South Carolina. Additionally, Backus USA
representative, David Knox, visited a building in South Carolina
that was under consideration by the Defendant as a potential site
for the Defendant's plant operations. (Document No. 6, Exhibit
A). Thereafter, Backus USA President, Larry Salone, accompanied
Mr. Knox on a subsequent visit to the Defendant operation site in order to gather
information and provide a comprehensive quote to the Defendant.
On or about March 23, 2004, "Backus USA  and the Defendant
entered into an agreement in which [the] Defendant agreed to
purchase an onion processing line and pepper processing line from
Backus USA." (Document No. 1, Exhibit 1). One of Backus USA's
responsibilities, inter alia, under the terms of the contract
was to deliver equipment to the Defendant in South Carolina.
(Document No. 6, Exhibit A). Once the equipment arrived, Backus
USA agreed to install, integrate, and debug the equipment, as
well as train the Defendant's employees. Id.
Subsequent to the parties entering into the agreement on March
23, 2004, the Plaintiff, Freshtec, alleges that Backus USA
assigned all if its right, title and interest in the contract to
the Plaintiff. (Document No. 1, Exhibit 1). Similarly, the
Defendant contends that it "understood that the equipment to be
supplied as part of the contract [between Backus USA and
Defendant] would be coming from a variety of manufacturers."
(Document No. 6, Exhibit D). In fact, "the vast majority of the
equipment was to be supplied by various companies from other
states[,] as well as overseas." Id. Also, some of the equipment
and machines were to be supplied by the Plaintiff.*fn3 Id.
During the course of the business relationship between the
Plaintiff and the Defendant, the Plaintiff alleges that the
Defendant failed to fulfill Defendant's responsibilities under
the terms of the contract. Id. For example, the Plaintiff
alleges that the "Defendant failed to provide assistance to Plaintiff for the various components necessary to finish the
onion and pepper processing lines." (Document No. 1, Exhibit 1, ¶
8). Additionally, the Plaintiff asserts that the "Defendant
failed to pay Plaintiff for the $30,000.00 in shipping expenses
that [P]laintiff has incurred to date." Id. at ¶ 9.
Consequently, based upon the Defendant's alleged indication to
the Plaintiff that "it does not intend to pay Plaintiff the
amount due Plaintiff under the contract," Plaintiff filed the
above-captioned action against the Defendant for "anticipatory
breach of the contract entitling Plaintiff to the full amount it
would be entitled to under the contract." Id. at ¶¶ 12-13.
On May 13, 2005, the Defendant filed a Motion to Dismiss for
Lack of Personal Jurisdiction, or, in the Alternative to Transfer
Venue Pursuant to 28 U.S.C. § 1404. Although the Court has
granted Plaintiff sufficient time in which to respond to
Defendant's motion, the Plaintiff failed to file a response in
opposition to the motion, as required by Local Rule of Civil
Initially, the Court observes that 28 U.S.C. § 1404(a) governs
transfer requests and 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." 28 U.S.C. § 1404(a).
Jumara v. State Farm Ins. Co., 55 F.3d 873, 878 (3d Cir. 1995);
Rappoport v. Steven Spielberg, Inc., 16 F.Supp.2d 481, 497-98
(D.N.J. 1998). "The purpose of § 1404(a) is to avoid the waste of
time, energy and money and, in addition to safe guard litigants,
witnesses and the public against avoidable inconvenience and
expense." Rappoport, 16 F.Supp.2d at 497. The party moving to
transfer venue bears the burden of establishing the need for a
transfer of venue; however, such motions "are not to be liberally
granted as the plaintiff's choice of venue is not to be lightly disturbed."*fn4 National Paintball
Supply, Inc. v. Cossio, 996 F.Supp. 459, 462 (E.D. Pa. 1998).
The Court observes that the Third Circuit has set forth that
the "choice of forum by a plaintiff is normally a `paramount
concern' in deciding a motion to transfer venue." Rappoport,
16 F.Supp. at 499 (citing Honeywell, 817 F.Supp. at 480). The
choice of forum by a plaintiff "is `entitled to greater
deference' when a plaintiff chooses its home forum." Id.
Indeed, "[t]he forum chosen by a plaintiff is considered to be
presumptively correct." Rappoport, 16 F.Supp. at 499. However,
this presumption is not dispositive. American Tel. & Tel. Co. v.
MCI Communications Corp., 736 F.Supp. 1294, 1306. (D.N.J. 1990).
Indeed, a court must consider other relevant factors in its
analysis of a motion to transfer. Rappoport,
16 F.Supp.2d at 500.
In determining whether a motion to transfer should be granted,
a court must "first determine whether the alternative forum is a
proper venue. . . ." National Paintball Supply, Inc.,
996 F.Supp. at 463. Next, the court should consider whether the
"balance of convenience clearly weighs in favor of the transfer.
Id. Should a court decide to transfer venue to an alternative
forum, such transfer "represents an `exercise  of structured
discretion by trial judges appraising the practical inconvenience
posed to the litigants and the court should a particular action
be litigated in one forum rather than another.'" Rappoport,
16 F.Supp.2d at 498 (quoting Ricoh Co. Ltd. v. Honeywell, Inc.
("Honeywell"), 817 F.Supp. 473, 479 (D.N.J. 1993) (quoting Lony
v. E.I.Du Pont de Nemours & Co., 886 F.2d 628, 632 (3d Cir.
1989)). However, no rigid rules exist in determining a motion to transfer venue, as these determinations
are based upon "a flexible and individualized analysis" of the
unique facts presented in each case. Rappoport,
16 F.Supp.2d at 498 (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 249-250,
102 S.Ct. 252, 70 L.Ed.2d 419 (1981)); see also Lacey v. Cessna
Aircraft Co., 862 F.2d 38, 43 (3d Cir. 1988)).
The Court further observes that in Gulf Oil Corp. v. Gilbert,
330 U.S. 501, 67 S.Ct. 839, 91 L.Ed. 1055 (1947), the Supreme
Court set forth two broad categories of factors to be considered
when determining whether an action should be transferred to a
different venue. Cited in Rappoport, 16F.Supp.2d at 498. For
example, the first broad category consists of "private interests"
of the parties involved in the litigation at issue. These private
interests include the following:
[T]he parties' residences, the residence of potential
witnesses, the situs of events giving rise to the law
suit, the location of records and documents and all
other practical problems that make the trial of a
case easy, expeditious and inexpensive.
National Paintball Supply, Inc., 996 F.Supp. at 463.
Additionally, the court should consider the broad category of
"public interest factors". National Paintball Supply, Inc.,
996 F.Supp. at 463; Rappoport, 16 F.Supp.2d at 498-99. These
factors involve "the administration of courts and the
adjudication of cases." Rappoport, 16 F.Supp.2d at 498. For
instance, some public interest factors include the following:
court congestion and other administrative
difficulties, placing the burden of jury duty on
those having the closest ties to the action, local
interest in having a matter adjudicated at home and
familiarity of the forum court with the applicable
Rappoport, 16 F.Supp. at 498-99 (citing Gulf Oil,
330 U.S. at 508-09, 67 S.Ct. 839; Jumara, 55 F.3d at 879). Accordingly, the
Court first determines whether the Defendant has established that
an adequate alternative forum exists for the dispute between the
parties. 1. Alternative Forum
The Court notes that although the Plaintiff's principal place
of business is in the Western District of Pennsylvania, the
record does not indicate that the factual circumstances
surrounding the negotiation of the contract agreed to between
Backus USA, and subsequently assigned to the Plaintiff, occurred
in the Western District of Pennsylvania. For example, after the
Defendant's search for production equipment companies yielded
preliminary contact discussions with Backus USA, it was Backus
USA representatives who traveled to South Carolina, where the
Defendant's principal place of business is located, in order to
meet with Defendant's personnel. Furthermore, all contract
proposals and face-to-face negotiation meetings were held in
South Carolina. (Document No. 6, Exhibit D.)
The record also provides evidence that the performance of the
contract at issue between the Plaintiff and Defendant was to
occur primarily at the Defendant's plant in North Charleston,
South Carolina. For example, under the terms of the contract,
"Backus USA's responsibilities for delivery, installation,
integration and debugging of the equipment, its training of
[Defendant] employees, follow-up calls by Backus USA, and the
verification of the required performance standards of the
production lines, were all to be performed at the South Carolina
plant." (Document No. 6, Exhibit D.).
In addition to Defendant's claims that all contract
negotiations and contract performances were to occur in South
Carolina, the Defendant also alleges that it has no offices in
Pennsylvania. (Document No. 6, Exhibit D). The Defendant claims
that it has no property of any kind in Pennsylvania, has never
registered to do business in Pennsylvania, and the Defendant does
not derive a substantial portion of its revenue from any sales to
Pennsylvania. Id. Furthermore, the Defendant maintains that prior to the Plaintiff filing the above
civil action, the Defendant did not ever visit Pennsylvania in
the ordinary course of business. Id.
The Court observes that upon consideration of the above
evidence in the case sub judice, and based upon Plaintiff's
failure to provide evidence that disputes Defendant's claims, the
Court determines that the above-captioned civil action could have
easily been commenced in the United States District Court in
South Carolina. Specifically, the Defendant's principal place of
business in located in South Carolina, all contract negotiations
at issue in the case sub judice occurred in South Carolina, all
performance responsibilities under the contract were to occur in
South Carolina, and all of the Defendant's employees are located
in South Carolina. Accordingly, the Court determines that the
United States District Court in South Carolina is a proper
alternative forum for the civil action between the parties in the
2. Convenience of Requested Forum
The Court next considers whether the balance of convenience
weighs in favor of the Defendant's motion to transfer to South
Carolina. In particular, the Court reviews private interest
factors, such as sources of proof, witnesses and documentary
evidence in order to determine whether the original choice of
forum selected by the Plaintiff would be unduly burdensome and
inconvenient. Indeed, the Supreme Court has stated:
To examine `the relative ease of access to sources of
proof' and the availability of witnesses, the
district court must scrutinize the substance of the
dispute between the parties to evaluate what proof is
required, and determine whether the pieces of
evidence cited by the parties are critical, or even
relevant, to the plaintiff's cause of action and to
any potential defenses to the action.
Rappoport, 16 F.Supp.2d at 500 (quoting Van Cauwenberghe, v.
Biard, 486 U.S. 517
, 528, 108 S.Ct. 1945, 100 L.Ed.2d 517
(1988)). Initially, the Court notes that the Plaintiff has brought an
anticipatory breach of contract action against the Defendant.
Accordingly, documents memorializing the agreement between the
parties, as well as documents evidencing all considerations
between the parties are relevant sources of proof in order to
establish a resolution in the above-captioned civil action.
The Court also observes that the Defendant has set forth the
following evidence regarding the location of witnesses and
evidence relevant to the above-captioned civil action:
The production lines and all of the equipment
provided under the contract are located at
[Defendant's] South Carolina plant. . . . To [the
Defendant's] knowledge, based on its prior dealings
with [the Plaintiff] and Backus USA, relevant
documents from these companies are located in North
Carolina, where David Knox is located, as well as
Pennsylvania, where Larry Salone resides. Additional
Backus USA documents may also be located in South
Carolina where Billy Mims, whom [the Defendant]
understands to be a former employee or agent of
Backus USA, resides. All of [the Defendant's]
documents are located in South Carlina. Documents of
third-parties . . . are located primarily in South
(Document No. 7). Conversely, the Plaintiff has not set forth any
objections to trial in the District of South Carolina; nor has
the Plaintiff proposed whether one forum would be more
convenient, providing better access to witnesses, documents, and
sources of proof. Accordingly, based upon the facts of the record
and the argument set forth by the Defendant, the Court's analysis
to this point weighs in favor of transferring the above-civil
action to the United States District Court in the District of
South Carolina in that trial in that forum provides for an
expeditious and inexpensive resolution. 3. Public Interest
The asserted connection between the contract dispute between
the above-captioned parties and the District of South Carolina
has been clearly demonstrated by the Defendant. The Court also
observes that the Defendant has provided to the Court certain
facts involving a pending state action in South Carolina.
On December 3, 2004, the Defendant filed and served a three
count Complaint against Backus USA and the Plaintiff in the
above-captioned civil action in the Court of Common Pleas for the
Ninth Judicial Circuit in Charleston County, South Carolina
alleging breach of contract, negligence, and breach of contract
accompanied by fraudulent act. (Document No. 7).
On December 20, 2004, with no pending civil action yet filed in
the United States District Court for the Western District of
Pennsylvania, the Defendant filed and served an Amended Complaint
in the South Carolina action adding counts for statutory unfair
trade practices under South Carolina law and for piercing the
corporate veil.*fn6 (Document No. 7).
On January 18, 2005, the Plaintiff filed a one count Complaint
against the Defendant, and on February 23, 2005, the Defendant
timely removed the action to the Western District of
Pennsylvania, which is the above-captioned civil action.
(Document No. 7). On August 25, 2005, the Court of Common Pleas in the State of
South Carolina, County of Charleston, denied defendants' Backus
USA, Freshtec Food Processing Equipment International, LLC,
Sormac B.V., Backus Foodtec, and Larry Salone's Motion to
Dismiss, or to Stay Proceedings. (Document No. 10). The South
Carolina action remains pending. Id.
Based upon this Court's evaluation of public interest factors,
such as "the locus of the alleged culpable conduct . . . the
connection of the conduct to the [P]laintiff's chosen forum", Van
Cauwenberghe, 486 U.S. at 529, 108 S.Ct. 1945, and upon
consideration of "local interest in having localized
controversies decided at home" Piper 454 U.S. at 241 n. 6,
102 S.Ct. 252, "the interest in having a trial of a diversity case in
a forum that is at home with the law that must govern the action;
the avoidance of unnecessary problems and conflicts of laws or
the application of foreign law; and the unfairness of burdening
citizens in an unrelated forum with jury duty" Rappoport,
16 F.Supp.2d at 500, the Court determines that an analysis of public
interest factors also weighs in favor of transfer to the United
States District Court in the District of South Carolina.
Accordingly, the Court finds that upon consideration of the
Defendant's Motion to Transfer Venue Pursuant to
28 U.S.C. § 1404, the record in the case sub judice, the relevant case law,
and the failure of Plaintiff to respond or object to Defendant's
motion, the Court shall grant the Defendant's Motion to Transfer
Venue to the United States District Court of South Carolina;
furthermore, the Court shall deny the Defendant's Motion to
Dismiss as that motion is left to the discretion of the United
States District Court in the District of South Carolina.
An appropriate order follows. ORDER
AND NOW, this 21st day of November, 2005, upon
consideration of Defendant's unopposed Motion to Dismiss or
Transfer Venue Pursuant to 28 U.S.C. § 1404 (Document No. 6), the
record in the case sub judice, the governing legal principles
set forth in 28 U.S.C. § 1404, and in accordance with this
Court's Memorandum Opinion, IT IS HEREBY ORDERED that the Court
shall grant the Defendant's Motion to Transfer Venue Pursuant to
28 U.S.C. § 1404, and deny the Defendant's Motion to Dismiss.
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