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Salandstacy Corp., et al v. Dwight Freeney

November 5, 2012

SALANDSTACY CORP., ET AL., PLAINTIFFS,
v.
DWIGHT FREENEY, ET AL.,
DEFENDANTS.



The opinion of the court was delivered by: Hammer, United States Magistrate Judge

OPINION

I. INTRODUCTION

Before the Court is a motion by Defendant Roof Group LLC ("Roof Group") to transfer this matter to the United States District Court for the Central District of California pursuant to 28 U.S.C. § 1404(a). Defendant Eva Weinberg has joined Roof Group's motion. ECF No. 108. Plaintiffs Salandstacy Corp., Salvatore Feli, and Stacy Feli oppose the motion. Pursuant to Federal Rule of Civil Procedure 78, the Undersigned did not hear oral argument. For the reasons set forth below, the Court will grant the motion to transfer and order that this matter be transferred to the United States District Court for the Central District of California.

II. FACTUAL BACKGROUND

Only the facts relevant to Roof Group's motion to transfer are set forth herein. These facts are based on the allegations in Plaintiffs' First Amended Complaint. This action involves a contract between Plaintiffs and Roof Group for the management of a restaurant in Los Angeles and the demise of the business relationship between the parties. Freeney and West met with Salvatore and Stacy Feli (the "Felis") to discuss opening a restaurant in Los Angeles, California-the Rolling Stone Los Angeles ("RSLA"). Amended Compl. at ¶ 28 (ECF No. 52). In April 2010, Freeney allegedly told the Felis that he would supply some of the financial backing for the restaurant and wanted them to help manage the RSLA. Id. at ¶ 30. The parties met on April 7, 2010, in New York City to discuss the particulars of the arrangement. Id. at ¶ 31. Then the Felis traveled to Miami, Florida to meet with David Stern, another alleged financial backer of RSLA. Id. at ¶ 34.*fn1 Next, the Plaintiffs met with Defendants and executives for Rolling Stone regarding licensing and legal issues in New York City. Id. at ¶ 35. After these meetings-during which, according to Plaintiffs' Complaint, a number of false statements were made-the Felis agreed to relocate to Los Angeles, California to manage the RSLA. Id. at ¶ 38. The Felis hoped that eventually they could return to the northeast and open a New York location. Id. In May, Mr. Feli signed a Term Sheet purportedly with Roof Group. See ECF No. 61-1 (Term Sheet between SalandStacy Cor. and Roof, LLC -- May 13, 2010). But as the restaurant was beginning, issues with funding allegedly arose and Plaintiffs were terminated on December 22, 2010. In addition to the funding issues, Plaintiffs allege that Defendants hired a consulting group, Krost, Baumgarten, Kniss, & Guerrero, Inc. ("KBKG")*fn2 to help oversee the opening of RSLA. Plaintiffs also allege that the KBKG Defendants, who are located in Pasadena, California, improperly influenced Roof Group to break their contract with Plaintiffs and hire different managers. It is unclear from the Amended Complaint whether Plaintiffs allege that their agreement with Roof Group ultimately failed due to lack of funding or to the influence of KBKG. In any event, central to the underlying dispute is that the Felis were not retained past December 2010 to manage the RSLA.

II. PROCEDURAL HISTORY

Plaintiffs originally filed this lawsuit in New Jersey Superior Court, Law Division, Essex County. Defendants removed the matter to this Court on June 14, 2011, and filed a motion to dismiss, which the Court granted in part and denied in part on March 21, 2012. (March 21, 2012 Order, ECF No. 43). On May 4, 2012, Plaintiffs filed an Amended Complaint (ECF No. 52). Defendants moved to dismiss the Amended Complaint. (ECF No. 61). The Court granted Defendants' motion and dismissed Plaintiffs' claims (1) for fraud as against Roof Group, Freeney, and West (Count Two); (2) for breach of fiduciary duty as against Roof Group, Freeney, and West (Count Three); and (3) seeking an accounting as against Roof Group (Count Four) with prejudice.*fn3 (August 22, 2012 Order, ECF No. 96). Besides those claims against Stern, the only claims that remain are Plaintiffs' breach-of-contract claim against Roof Group and their tortious- interference claim against Weinberg and the KBKG Defendants.

Roof Group now seeks to transfer this matter to the Central District of California under 28 U.S.C. § 1404(a). Defendants Roof Group, West, and Freeney had filed counterclaims against Plaintiffs, but requested leave to voluntarily dismiss their counterclaims without prejudice, which Judge Linares granted on October 9, 2012. (ECF No. 122).

This motion is now brought only by Roof Group. Weinberg has filed a letter stating that she joins in the motion. (September 18, 2012 Letter, ECF No, 108). Stern and the KBKG Defendants have not joined nor stated any position regarding the motion to transfer. Plaintiffs have opposed the motion. (ECF No. 114).

IV. DISCUSSION

Section 1404(a) vests a district court with discretion "to adjudicate motions to transfer according to an individualized, case by case consideration of convenience and fairness." Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 23 (1998) (quoting Van Dusen v. Barrack, 376 U.S. 612, 616 (1964)). Specifically, § 1404(a) 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 ... where it might have been brought."

The purpose of § 1404(a) is to protect litigants, witnesses, and the public against unnecessary inconvenience and expense. Van Dusen, 376 U.S. at 616. Courts are not limited to only these factors, however, and should consider "all relevant factors to determine whether on balance the litigation would more conveniently proceed and the interest of justice be better served by transfer to a different forum." Jumara v. State Farm Ins. Co., 55 F.3d 873, 879 (3d Cir. 1995); see also Clark v. Burger King Corp., 255 F. Supp. 2d 334, 337 (D.N.J. 2003). This standard creates an analysis that "is flexible" with decisions being made based "on the unique facts of each case." Calkins v. Dollarland, Inc., 117 F. Supp. 2d 421, 428 (D.N.J. 2000) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 249-50 (1981)). The burden of establishing the need for transfer rests on the moving party, in this case Roof Group. See Jumara, 55 F.3d at 879.

The Third Circuit has listed the public and private interest factors to be weighed when considering a motion to transfer:

The private interests have included: plaintiff's forum preference as manifested in the original choice; the defendant's preference; whether the claim arose elsewhere; the convenience of the parties as indicated by their relative physical and financial condition; the convenience of the witnesses--but only to the extent that the witnesses may actually be unavailable for trial in one of the fora; and the location of books and records (similarly limited to the extent that the files could not be produced in the alternative forum).

The public interests have included: the enforceability of the judgment; practical considerations that could make the trial easy, expeditious, or inexpensive; the relative administrative difficulty in the two fora resulting from court congestion; the local interest in deciding local controversies at home; the public policies of the fora; and the familiarity of the trial judge with ...


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