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Taylor v. Shreeji Swami, Inc.

United States District Court, D. Maryland, Southern Division

May 8, 2017

HARVEY L. TAYLOR, Plaintiff,
SHREEJI SWAMI, INC., et al., Defendants.


          Paul W. Grimm United States District Judge.

         After being stuck in an elevator at Defendants' hotel in Kinston, North Carolina and experiencing a panic attack, Plaintiff Harvey L. Taylor filed suit in this Court against Defendants Shreeji Swami, Inc.; LRP Hotels of Kinston, LLC; Intercontinental Hotel Group Resources, Inc.; Holiday Franchising, LLC; and IHG Franchising, LLC, [1] alleging common law claims and statutory causes of action under state and federal law. Compl. 1, ¶¶ 21-24, ECF No. 1. Pending is Defendants' motion to dismiss for lack of venue, ECF No. 6.[2] Although I find that venue is proper, it appears that the Eastern District of North Carolina may be a more appropriate venue. Because I cannot make this determination on the record before me, I will permit the parties to submit relevant evidence before I decide whether to transfer this case.


         Taylor alleges that venue is proper in Maryland under 28 U.S.C. § 1391 because he is a Maryland resident, “Defendants first solicited plaintiff[']s business at his Maryland residence, ” and he continues to suffer damages in Maryland from the incident. Compl. ¶ 2. In Defendants' view, these alleged events in Maryland do not give rise to venue. Defs.' Mem. 3. If venue is improper, Fed.R.Civ.P. 12(b)(3) provides a basis for dismissal. See Am. Ins. Mktg. Corp. v. 5 Star Life Ins. Co., 958 F.Supp.2d 609, 612 (D. Md. 2013). On a Rule 12(b)(3) motion to dismiss, to “determin[e] whether events . . . are sufficiently substantial to support venue under [§ 1391], ” a court “should review ‘the entire sequence of events underlying the claim'” instead of “focus[ing] only on those matters that are in dispute or that directly led to the filing of the action.” Mitrano v. Hawes, 377 F.3d 402, 405 (4th Cir. 2004). The court may consider evidence outside the pleadings. Am. Ins. Mktg. Corp., 958 F.Supp.2d at 612; see Sucampo Pharms., Inc. v. Astellas Pharma, Inc., 471 F.3d 544, 550 (4th Cir. 2006)). The court draws all reasonable inferences in the light most favorable to the plaintiff, who “need only make ‘a prima facie showing of proper venue in order to survive a motion to dismiss'” when the court does not hold an evidentiary hearing. Am. Ins. Mktg. Corp., 958 F.Supp.2d at 612 (quoting Aggarao v. MOL Ship Mgt. Co., 675 F.3d 355, 366 (4th Cir. 2012)).

         Pursuant to 28 U.S.C. § 1391, a plaintiff may file suit in

(1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located;
(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) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action.

28 U.S.C. § 1391(b). Defendants contend that “Maryland is not the proper venue under § 1391(b)(1), as all defendants are not residents of the State in which the district is located”; nor is venue proper under § 1391(b)(2) because “all of the alleged tortious conduct (being stuck in the Hotel elevator) occurred in North Carolina.” Defs.' Mem. 3. As noted, Taylor alleged jurisdiction under § 1391(b)(2), Compl. ¶ 2, but in opposing Defendants' motion, he argues that Defendants' waiver of the defense of personal jurisdiction gives rise to venue under § 1391(b)(1) as well, Pl.'s Opp'n 4. Defendants dismiss this argument, countering that, “[e]ven assuming, arguendo, that Defendant has waived any challenge to personal jurisdiction in this matter, that analysis is irrelevant to this Court's determination as to the appropriate venue in this case.” Defs. Reply 5.

         Taylor's argument for venue under § 1391(b)(1) has merit, which Defendants concede by failing to rebut it. See Stenlund v. Marriott Int'l, Inc., 172 F.Supp.3d 874, 887 (D. Md. 2016) (“In failing to respond to this argument, Plaintiff concedes the point.”). Defendants, as “entit[ies] with the capacity to sue and be sued in [their] common name under applicable law, ” are “deemed to reside . . . in any judicial district in which such defendant is subject to the court's personal jurisdiction with respect to the civil action in question.” 28 U.S.C. § 1391(c)(2). As Taylor notes, Pl.'s Opp'n 4, all Defendants failed to allege lack of personal jurisdiction when moving to dismiss for improper venue, thereby waiving that defense, Fed.R.Civ.P. 12(h)(1)(A). Consequently, they are subject to this Court's personal jurisdiction and all “deemed to reside” in this district. See 28 U.S.C. § 1391(c)(2); Fed.R.Civ.P. 12(h)(1)(A). In this analysis, “the venue inquiry . . . collapses into the question of whether there is personal jurisdiction over [Defendants], ” and because this Court has personal jurisdiction over Defendants, venue is proper under § 1391(b)(1). See World Missions Ministries, Inc. v. Gen. Steel Corp., No. RWT 06-13, 2006 WL 2161851, at *3 (D. Md. July 28, 2006) (noting that the parties' dispute about “whether ‘a substantial part of the events or omissions giving rise to the claim occurred' in Maryland” was “unnecessary, ” because “there is venue under § 1391([b])(1)” by virtue of the defendants' waiver of the defense of lack of personal jurisdiction, and “§ 1391([b](1) is dispositive” (quoting § 1391(b)(2))).

         In their Reply, Defendants argue for the first time that, if Plaintiffs' Complaint is not dismissed, it should be transferred to North Carolina under the doctrine of forum non conveniens.[3] Defs.' Reply 3. “The ordinary rule in federal courts is that an argument raised for the first time in a reply brief or memorandum will not be considered.” Clawson v. FedEx Ground Package Sys., Inc., 451 F.Supp.2d 731, 734 (D. Md. 2006). But, given that Taylor raised the possibility of transfer as an alternative to dismissal, see Pl.'s Opp'n 5, such that the parties have notice of the possibility of transfer and have briefed the issue, and considering that “[i]t is well established that a federal district court has the power to make a sua sponte transfer of venue under 28 U.S.C. § 1404(a) to another district where the case could have been brought or to any district to which all parties have consented” when the parties have notice and have had “the opportunity to brief the issue, ” I will consider whether transfer is appropriate. See ING Bank N.V. v. Temara, No. JKB-15-1488, 2016 WL 67254, at *2 (D. Md. Jan. 5, 2016); see also Feller v. Brock, 802 F.2d 722, 729 n.7 (4th Cir. 1986) (“Although a motion by one of the parties is ordinarily required for transfer, the district court may consider the possibility of transfer sua sponte. If the matter is raised sua sponte, the parties deserve an opportunity to be heard before a decision is rendered.”); Charles A. Wright, Arthur R. Miller, Edward H. Cooper, and Richard D. Freer, Fed. Prac. & Proc. § 3844 & n.2 (4th ed. 2013).

         A district court may exercise its discretion to transfer a civil action to another district or division pursuant to 28 U.S.C. § 1404(a), which Congress enacted “to prevent the waste of time, energy and money as well as to protect litigants, witnesses and the public against unnecessary inconvenience and expense.” Topiwala v. Wessell, No. WDQ-11-543, 2012 WL 122411, at *6 & n. 21 (D. Md. Jan.12, 2012) (quoting Dicken v. United States, 862 F.Supp. 91, 92 (D. Md. 1994)); see also In re Ralston Purina Co., 726 F.2d 1002, 1005 (4th Cir.1984). 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 . . . .”

         The Court's first consideration is “whether the action could have been brought in the transferee district.” Topiwala, 2012 WL 122411, at *6. Here, it is undisputed that Taylor could have brought this action in North Carolina. Therefore, “the Court considers: (1) the weight accorded plaintiff's choice of venue, (2) witness convenience and access, (3) convenience of the parties, and (4) the interest of justice.” Topiwala, 2012 WL 122411, at *6 (footnotes omitted). Other relevant considerations include (1) “availability of compulsory process for attendance of unwilling witnesses, and the cost of obtaining attendance of willing and unwilling witnesses” and (2) “local interest in having localized controversies settled at home.” Laureate Educ., Inc. v. Megahed, No. AW-10-749, 2010 WL 2651895, at *10 (D. Md. July 1, 2010) (quoting Stratagene v. Parsons Behle & Latimer,315 F.Supp.2d 765, 771 (D. Md. 2004)). The Court weighs these factors, considering the specific facts of the case to determine whether “the litigation would more conveniently proceed and the interests of justice be better served by transfer to a different forum.” Topiwala, 2012 WL 122411, at *6 (quoting Byerson v. Equifax Info. Servs., LLC, 467 F.Supp.2d 627, 632 (E.D. Va. 2006)). The statute does not indicate how much weight the Court should give to each factor. See Byerson, 467 F.Supp.2d at 632; Topiwala, 2012 WL 122411, at *6 n. 22. The burden is on Defendants to demonstrate, “by a preponderance of the evidence, . . . that transfer to another forum is proper.” Tse v. ...

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