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Summit Food Enterprises, Inc. v. Continental Concessions Supplies Inc.

United States District Court, D. New Jersey

March 10, 2015

SUMMIT FOOD ENTERPRISES, INC., Plaintiff,
v.
CONTINENTAL CONCESSIONS SUPPLIES INC. AND ADAM GOTTLIEB, Individually, and JUST BORN, INC. Defendants.

OPINION AND ORDER

JOSEPH A. DICKSON, Magistrate Judge.

This matter comes before the Court upon the following motions: (1) the motion by Plaintiff Summit Food Enterprises, Inc., ("Summit"), to amend the Complaint, (ECF No. 24), and (2) the motion by Defendant Just Born, Inc., ("Just Born"), to dismiss or, in the alternative stay, or transfer the instant action to the Eastern District of Pennsylvania. (Motion to Dismiss, ECF No. 27). Co-defendants ("CCSI") and ("Gottlieb") have also requested that in the alternative to dismissal, the Court stay or transfer this matter to the Eastern District of Pennsylvania. (CCSI & Gottlieb Response, ECF No. 33). This Court has carefully considered the written submissions of the parties, as well as the oral arguments presented to the Court on February 27, 2015. For the reasons expressed below, the Court concludes that venue is improper in this District. The Court therefore, in its discretion, will transfer, rather than dismiss, this action, pursuant to 28 U.S.C. § 1406(a), to the United States District Court for the Eastern District of Pennsylvania.[1]

I. BACKGROUND AND PROCEDURAL HISTORY

Summit brought the instant action against Defendants, CCSI and Gottlieb, individually, alleging tortious interference with contractual relations and intentional interference with a prospective business advantage. (Complaint, ECF. No 1-1). Thereafter, on January 29, 2014, the Complaint was amended by Summit to join Just Born as a Defendant. (Amended Complaint, ECF No. 8). The underlying lawsuit arises out of an alleged agreement entered into by Summit and Just Born, which Summit claims authorized Summit to act as Just Born's exclusive representative in the movie theater concession industry. (Id. at 3).

On or about August 21, 2014, Just Born filed a motion to dismiss or, in the alternative stay, or transfer the instant action. (Motion to Dismiss, ECF No. 27). Specifically, Just Born argues that this Court lacks personal jurisdiction over Just Born. (Id. at 9). Just Born contends that general jurisdiction does not exist because "while Just Born sells products to retailers in New Jersey, Summit has not demonstrated more than such minimum contacts" and that to support the exercise of general jurisdiction, "a defendant must have continuous and systematic contacts with the forum state." (Id. at 9-10). Moreover, Just Born also maintains that this Court does not have specific jurisdiction over it because the lawsuit does not arise from nor is related to Just Born's conduct within New Jersey. (Id. 11).

Just Born also contends that the case should be dismissed, or transferred to the Eastern District of Pennsylvania because New Jersey is an improper venue under 28 U.S.C. § 1391(a). (Id. at 11-12). Just Born explains that venue is improper because (1) all the defendants do not reside in New Jersey, (2) the majority of the events giving rise to the litigation did not occur in New Jersey, but rather in Pennsylvania, and (3) alternative venues, such as the Eastern District of Pennsylvania, exist in which this action could have been properly brought. (Id. at 12).

In support of the position that the Eastern District of Pennsylvania represents an appropriate venue for this action, Just Born emphasizes that a substantial part of the events giving rise to the instant lawsuit occurred in Pennsylvania. (Id. at 21-22). For instance, Just Born contends that its business transactions with CCSI and Gottlieb, as well as its dealings with Summit took place in Pennsylvania. (Id. at 21). Similarly, Just Born also asserts that the Eastern District of Pennsylvania is a proper forum because personal jurisdiction over all of the Defendants exists. (Id. at 23).

Lastly, Just Born argues that dismissal or transfer is appropriate under the "first to file" rule because the instant action arises out of the same transactions and occurrences as does another case, (Civil Action No. 13-cv-07313), which Just Born contends was filed earlier in the Eastern District of Pennsylvania. (Id. at 13). Specifically, Just Born asserts that both actions arise from the same alleged agreement between Just Born and Summit. (Id.) Just Born maintains that the Court should either dismiss, stay, or transfer the instant action because the action pending in the Eastern District of Pennsylvania was filed on December 13, 2013, while Just Born was not joined as a Defendant in the instant action until January 29, 2014, when the First Amended Complaint, (ECF No. 8), was filed by Summit. (Id. at 16; ECF No. 29). Based on this reasoning, Just Born argues that the Eastern District of Pennsylvania action is the first-filed action as Just Born had no ability to contest the claim by Summit until January 29, 2014, more than a month after the Eastern District of Pennsylvania action was filed. (Id. at 16).

On or about September 02, 2014, Summit submitted an opposition to Just Born's motion. (Summit Opp'n, ECF No. 30). Summit argues that the District of New Jersey is an appropriate forum for the following reasons: (1) Just Born defended a similar action brought by AICPC in New York, which is farther away in distance than New Jersey, without any objection to personal jurisdiction, improper venue, or complaints of hardship, inconvenience, or prejudice, (Id. at 4), (2) under the "first to file" rule, Summit filed the original complaint on November 18, 2013, which is prior to the filing of the Eastern District of Pennsylvania complaint, (Id. at 5), (3) CCSI and Gottlieb waived any jurisdictional and venue defenses by failing to file a pre-Answer motion or preserving such defenses in their Answer, as well as by asserting counterclaims against Summit, (Id. at 6-7), (4) this Court has personal jurisdiction over Just Born on the basis of its substantial, continuous and systematic course of business activity in New Jersey, (Id. at 8), (5) New Jersey is a proper venue under 1391(c) because the Court has personal jurisdiction over CCSI, Gottlieb, and Just Born, (Id. at 14), (6) and in addition to not being the "first to file" forum, the Eastern District of Pennsylvania would not afford adequate relief to the parties and is a forum non conveniens, as Summit is located in Massachusetts and CCSI and Gottlieb are located in NY, (Id. at 20-23).

In addition, on or about September 02, 2014, Defendants CCSI and Gottlieb collectively filed an informal letter response to Just Born's motion to dismiss, or in the alternative, stay or transfer the matter to the Eastern District of Pennsylvania. (CCSI & Gottlieb Response, ECF No. 33). In their letter dated September 02, 2014, Defendants CCSI and Gottlieb advise the Court that they have no objections to Just Born's instant motion. (Id. at 1). In fact, Defendants CCSI and Gottlieb state that they "support a stay of this matter pending the outcome of the EDPA Action or that this matter be transferred to the Eastern District of Pennsylvania and consolidated with the EDPA Action to avoid inconsistent decisions." (Id. at 2). Furthermore, Defendants CCSI and Gottlieb contend that they are subject to personal jurisdiction in Pennsylvania, as provided in the Affidavit of Adam Gottlieb, (Affidavit of Adam Gottlieb, ECF No. 28). (Id. at 1). In his affidavit, Adam Gottlieb explains that CCSI is authorized to do business with the State of Pennsylvania, has generated millions of dollars in revenue from business within Pennsylvania, and has even conducted business with Just Born, a Pennsylvania company within the past year. (Aff. of Gottlieb, ECF No. 28).

On February 27, 2015, the parties appeared before this Court for oral argument.

II. LEGAL STANDARD - Venue

28 U.S.C. § 1404(a) and 28 U.S.C. § 1406(a) are the two provisions governing venue transfers in civil cases. § 1404(a) reads in relevant part, as follows: "For 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." § 1406(a) provides in pertinent part: "The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought."

Distinctions between § § 1404(a) and 1406(a) have to do with discretion, jurisdiction, and choice of law. Section 1404(a) transfers are discretionary determinations made for the convenience of the parties and presuppose that the court has jurisdiction and that the case has been brought in the correct forum. Jumara v. State Farm Ins. Co., 55 F.3d 873, 878 (3d Cir.1995); 17A Moore's Federal Practice, § 111.02 (Matthew Bender 3d ed.2006). Section 1406(a) comes into play where plaintiffs file suit in an improper forum. Jumara, 55 F.3d at 878; Moore's Federal Practice, supra, § 111.02. In those instances, district courts are required either to dismiss or transfer to a proper forum. Goldlawr, Inc. v. Heiman, 369 U.S. 463, 465-66, 82 S.Ct. 913, 8 L.Ed.2d 39 (1962) ...


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