merely clouds the issue of personal jurisdiction over these defendants when it points to Locke Machine's contacts with New Jersey by virtue of its periodic contributions to the Fund. The issue is not whether Locke Machine has minimum contacts with New Jersey; Locke Machine is subject to personal jurisdiction here because it is an "employer" under ERISA. The affidavits submitted by Immomen and Jones affirmatively establish the absence of those defendants' contacts with New Jersey. This evidence has not been contradicted by the Fund. The plaintiffs also failed to meet their burden with respect to establishing the existence of personal jurisdiction over Whiting. Therefore, the individual defendants do not have the requisite contacts with and are not subject to personal jurisdiction in New Jersey.
This finding does not necessitate the dismissal of the action. Even in cases where "the lack of in personam jurisdiction is in doubt, sound judicial administration requires transfer to a district where [the action] clearly could have been brought." Societe Nouvelle Generale v. Kool Stop Intern., 633 F. Supp. 153, 155 (E.D.Pa. 1985) (citing Schwilm v. Holbrook, 661 F.2d 12 (3d Cir. 1981)). 28 U.S.C. § 1404(a) provides: "For the convenience of the 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 purpose of this section is "to protect litigants, witnesses and the public against unnecessary inconvenience and expense." Van Dusen v. Barrack, 376 U.S. 612, 616, 11 L. Ed. 2d 945, 84 S. Ct. 805 (1964); cf. Lacey v. Cessna Aircraft Co., 862 F.2d 38, 42 (3d Cir. 1988).
In this case, dismissal of the state law claims as to the individual defendants would put the plaintiffs in a difficult position: this action would be maintained against a corporation which has no assets, but the remaining claims against the individual defendants would have to be pursued individually. Further, dismissal might create statute of limitations problems as to the state law claims. Thus, the interests of justice favor transfer of this case to a forum where the plaintiffs can proceed against all the defendants, rather than dismissal as to the individual defendants alone.
In United States v. Berkowitz, 328 F.2d 358 (3d Cir.), cert. denied, 379 U.S. 821, 13 L. Ed. 2d 32, 85 S. Ct. 42 (1964), the Third Circuit held that the transferror court need not have jurisdiction over the defendant in order to transfer an action under 28 U.S.C. § 1404(a). Id. at 361. The Third Circuit followed the Supreme Court's reasoning in Goldlawr, Inc. v. Heiman, 369 U.S. 463, 82 S. Ct. 913, 8 L. Ed. 2d 39 (1962), which held that a district court need not have jurisdiction over the defendant in order to transfer a case laying venue in the wrong district under 28 U.S.C. § 1406(a). The Goldlawr holding with respect to § 1406(a) is equally applicable to § 1404(a), because these are companion sections, remedial in nature, enacted at the same time, and both dealing with the expeditious transfer of an action from one district or division to another. Berkowitz, 328 F.2d at 361. Both the Supreme Court and the Third Circuit emphasized the "general purpose which has promoted many of the procedural changes of the past few years -- that of removing whatever obstacles may impede an expeditious and orderly adjudication of cases and controversies on their merits." Berkowitz, 328 F.2d at 361 (citing Goldlawr, 369 U.S. at 466-67).
It appears the only defendant subject to personal jurisdiction in this forum is the corporate entity, Locke Machine, the assets of which have been distributed among the shareholders. There is no reason to maintain an action here against the corporation and a parallel action elsewhere against the individual defendants. This course of action would be a hardship on the plaintiffs, who would be forced to litigate related claims in at least two courts.
Counsel for Locke Machine, Immonen and Jones stipulated and represented at oral argument that those defendants would not object to personal jurisdiction and venue in the Northern District of Ohio.
That district also appears to be the most appropriate forum for transfer for a number of reasons. It seems Locke Machine, Immonen and Jones are subject to personal jurisdiction in that State. Locke Machine had its principal place of business there, Jones is an Ohio resident and both Immonen and Jones availed themselves of the benefits of the laws of Ohio by acting as officers, directors and shareholders of Locke Machine. Further, counsel represents Locke Machine held its annual and special meetings of Locke Machine in Ohio. The decisions and acts relevant to this dispute -- including the votes of the board of directors and shareholders to distribute the assets of Locke Machine to the shareholders -- appear to have taken place primarily, if not exclusively, in the Northern District of Ohio.
As to defendant Whiting, counsel was not forthcoming in stipulating to the jurisdiction of the Ohio court. Nevertheless, Whiting was a shareholder of Locke Machine during the time period relevant to this dispute and voted, either in person or by proxy, at meetings in Ohio relating to the sale of Locke Machine's assets. Counsel for Whiting did not contest these facts. Finally, it is apparent that subject matter jurisdiction over the state law claims would be founded on diversity of citizenship, 28 U.S.C. § 1332.
Therefore, transfer of the state law claims to the Northern District of Ohio appears appropriate and in the interests of justice.
For the reasons stated above, the first and second causes of action are dismissed without prejudice as to the individual defendants and the remaining claims in this action are transferred to the Northern District of Ohio.
SO ORDERED, this 29th day of November, 1989.