Opinion
CASE NO. 1:02-cv-1671-DFH
February 12, 2004
ENTRY ON MOTION TO TRANSFER
Defendant West Coast Metric, Inc. has moved to transfer this trademark infringement action to the Central District of California pursuant to 28 U.S.C. § 1404(a), which authorizes such transfers for the convenience of the parties and witnesses or in the interest of justice. For the reasons explained below, defendant's motion to transfer is hereby denied. Plaintiffs' separate motion to consolidate this action with another action pending in this district is denied as moot because the parties have advised the court that the other case has settled.
I. The Parties, the Claims, and the Evidence
Plaintiffs (collectively, "VW") are Volkswagen Aktiengesellschaft ("VWAG") and Volkswagen of America, Inc. ("VWOA"). They allege in this case that defendant West Coast Metric, Inc. has distributed and sold unauthorized and unlicensed products bearing plaintiffs' trademarks. VW seeks relief under the federal trademark laws, Indiana common law, and an Indiana statute authorizing civil remedies for victims of crimes.
The case stems from an investigation carried out by a private investigation company, Continental Enterprises, which is located in the Indianapolis area. Continental Enterprises conducted the investigation in Indiana by contacting West Coast Metric in California and a number of its customers in different states throughout the country, including Michigan, Illinois, Arizona, and the state of Washington. Continental Enterprises reports that it purchased West Coast Metric products in Indiana, either directly from West Coast Metric itself or from its distributors. Witnesses with information about the investigation of West Coast Metric and its products and activities include several current and former employees of Continental Enterprises in this district. Documents and physical evidence from the investigation are also located in this district.
West Coast Metric is located in Harbor City, California, in the Los Angeles area. Its primary business is manufacturing and supplying automobile parts. West Coast Metric has approximately 18 employees. All of its current and former owners, managers, and employees live and work in California, as does its only accountant. The majority of its design and manufacturing takes place in California.
Plaintiff VWAG is a German corporation with its principal place of business in Wolfsburg, Germany, and it is of course one of the major auto manufacturers in the world. Plaintiff VWOA is a New Jersey corporation with its principal place of business in Auburn Hills, Michigan.
II. Discussion
A motion to transfer under § 1404(a) for the convenience of the parties and witnesses and in the interests of justice is committed to the sound discretion of the district court. Under § 1404(a), West Coast Metric has the burden of proving that the Central District of California is "clearly more convenient" than the Southern District of Indiana. Coffey v. Van Dorn Iron Works, 796 F.2d 217, 220 (7th Cir. 1986).
A. Convenience for Parties and Witnesses
Transferring this case to California would merely shift some inconvenience from one side to the other. It is well-established that "the effect of a transfer cannot be a mere shift of inconveniences" among the parties. Moore v. ATT Latin Am. Corp., 177 F. Supp.2d 785, 789 (N.D. Ill. 2001), citing Promatek Med. Sys., Inc. v. Ergometrics, Inc., 1990 WL 19491, at *4 (N.D. Ill. 1990); Sage Prods., Inc. v. Devon Indus., Inc., 148 F.R.D. 213, 216 (N.D. Ill. 1993); accord, Educational Visions, Inc. v. Time Trend, Inc., 2003 WL 1921811, at *7 (S.D. Ind. April 17, 2003) (denying motion to transfer that would have merely shifted inconvenience between parties); Beller v. MacDermid, Inc., 2002 WL 31045377, at *5 (S.D. Ind. Sept. 9, 2002) (same).
Because merely shifting inconvenience from one party to another does not justify a transfer, a major concern under § 1404(a) is the availability of non-party witnesses and evidence. The assumption is that the parties will be sufficiently motivated to have their own employees or other allies appear for trial wherever it might take place. See, e.g., FUL Inc. v. Unified Sch. Dist. No. 204, 839 F. Supp. 1307, 1311 (N.D. Ill. 1993), cited in Greene Mfg. Co. v. Marquette Tool Die Co., 1998 WL 395155, at *3 (N.D. Ill. July 9, 1998). Parties may use Rule 45 of the Federal Rules of Civil Procedure to conduct discovery all over the United States, so the principal concern along these lines is to make non-party witnesses available for trial. The aim is to minimize the risk of "trial by deposition." See, e.g., Volkswagen Aktiengesellschaft v. Dee Engineering, Inc., 2003 WL 1089515, at *4 (S.D. Ind. March 4, 2003); Kendall U.S.A., Inc. v. Central Printing Co., 666 F. Supp. 1264, 1268 (N.D. Ind. 1987); Preston v. Missouri-Nebraska Exp., Inc., 1991 WL 626751, at *2 (W.D. Mo. Oct. 16, 1991).
In this case, all or nearly all of the non-party witnesses the parties have identified are very closely affiliated with the side that will call them to testify. For VW, the non-party witnesses in Indiana are the staff of Continental Enterprises, which has a long-standing business relationship with VW. For West Coast Metric, the non-party witnesses in California are its suppliers and professional advisers, such as its accountant. The court therefore can assume that each party would probably be able to secure the presence of its allies or affiliates for trial even in what ends up being the more distant venue for one of the parties. VW has indicated it may have some other non-party witnesses, such as customers of West Coast Metric from around the nation, but their locations do not favor either of the suggested venues. In short, the availability of non-party witnesses and evidence is a neutral factor that does not weigh in favor of a transfer.
Plaintiffs' choice of forum is entitled to some weight in the transfer calculus. FDIC v. Citizens Bank Trust Co., 592 F.2d 364, 368 (7th Cir. 1979). In addition, Indiana is where Continental Enterprises reports it purchased allegedly infringing products, either directly from West Coast Metric or from its distributors, this case has a substantial and direct connection to this forum.
Defendant argues that the plaintiffs' choice of forum is entitled to less weight when the plaintiffs have chosen a forum that is not their own home base. In support, defendant cites a decision by Chief Judge McKinney in another VW trademark infringement case also involving an investigation by Continental Enterprises, Volkswagen Aktiengesellschaft v. Dee Engineering, Inc., 2003 WL 1089515, at *2 (S.D. Ind. March 4, 2003).
On this point, the Dee Engineering opinion cites several cases, but one must look further into the chain of citations for a reason for the diminished weight accorded when the forum is not a plaintiff's home base. On closer examination, the more general point is actually that the plaintiff's choice of forum is entitled to less deference when the chosen forum is neither the plaintiff's home turf nora forum that bears a substantial relationship to the cause of action, such as the place where the cause of action arose. See, e.g., Gemological Institute of America, Inc. v. Trang Thi-Dai Phan, 145 F. Supp.2d 68, 71 (D.D.C. 2001), quoting DeLoach v. Philip Morris Co., Inc., 132 F. Supp.2d 22, 24 (D.D.C. 2000) ("although a plaintiff's choice of forum is ordinarily accorded a significant degree of deference, numerous cases in this Circuit recognize that such a choice receives substantially less deference where the plaintiff's, as here, neither reside in, nor have any substantial connection to, that forum"); General Instrument Corp. v. Mostek Corp., 417 F. Supp. 821, 823 (D. Del. 1976) ("Where the forum selected by plaintiff is connected neither with the plaintiff nor with the subject matter of the lawsuit, meeting the burden of showing sufficient inconvenience to tip the `balance' of convenience `strongly in favor of defendant' will ordinarily be less difficult."), cited by Judge Barker in State Farm Mut. Auto. Ins. Co. v. Bussell, 939 F. Supp. 646, 651 (S.D. Ind. 1996), cited in turn in Dee Engineering. In this case, the plaintiffs' chosen forum has a strong connection to the action, for this is where most of the claims arose. Accordingly, this court sees no substantial reason to disregard plaintiffs' choice of the forum where the claims arose. See Beller, 2002 WL 31045377, at *5 (deferring to plaintiff's choice of forum where forum state was not his residence but was place where claim arose and where non-party witnesses were located). The convenience of the parties and witnesses does not support a transfer to the Central District of California.
III. The Interest of Justice
Transferring this action would not further "such concerns as ensuring speedy trials, trying related litigation together, and having a judge who is familiar with the applicable law try the case." Heller Financial, Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1293 (7th Cir. 1989), citing Coffey, 796 F.2d at 221.
The parties have, interestingly, drawn on data from the Administrative Office of U.S. Courts to look at time to disposition in the two districts. For one year relied upon by defendant, the median time to trial in a civil case in this district was 23.5 months, and in the Central District of California it was 18.3 months. VW has cited data showing comparable median times to trial for the year ending September 30, 2002 as 22.4 months in this district and 20.0 months in the Central District of California. Whether the difference is two months or six months, this particular action is already set for trial in this district in June 2004. A transfer would result in more delay. Even an earlier transfer when briefing was completed on the transfer motion would probably have resulted in more delay. The court calendars do not favor a transfer.
The applicable law on the trademark claims will be federal law, and VW has offered a reasonable basis for applying Indiana law to sales of allegedly infringing products in Indiana. The choice of applicable law does not favor a transfer. Accordingly, the interests of justice do not favor a transfer of this case.
IV. Dee Engineering
West Coast Metric understandably asks this court to follow the decision of Chief Judge McKinney to transfer a similar VW trademark infringement case against Dee Engineering to a different district. In Dee Engineering, the fact that Continental Enterprises and the evidence it gathered are in this district was discounted by the court on the theory that the contested issues in the lawsuit would center on evidence in California rather than the evidence in Indiana. See 2003 WL 1089515, at *4. It is not clear from the Dee Engineering opinion how the defendant showed the court which issues were actually going to be contested. (For example, did the defendant stipulate that the products sold in Indiana were infringing?) In any event, there has been no such showing in this case. West Coast Metric has said only that is not "likely" to dispute the "principal" facts to be proven with Continental Enterprises witnesses, but that is a very slippery assurance. The absence of a showing as in Dee Engineering is an important difference.
West Coast Metric also contends that it is a small company and that VW can more easily afford to litigate on the road, citing Dee Engineering at *3 (finding that VW had greater relative ability to pay to litigate on the road). VW responds that West Coast Metric is being defended by an insurance company, so that this factor should not weigh in favor of a transfer. West Coast Metric contends that insurance should not be relevant, but it was West Coast Metric that chose to inject the issue of financial resources into the transfer dispute. Also, while West Coast Metric has hinted there might be issues with its insurance coverage, see Reply Br. at 10, it has not indicated that there actually are such issues. Having raised the issue of resources, West Coast Metric cannot close the door on half the evidence. The parties' resources are not so disparate here as to weigh in favor of a transfer, and that is another important difference between this case and Dee Engineering. West Coast Metric has chosen to sell its products nationally, and it is not unfair to expect it to respond to litigation where it sells its products, which often occurs in trademark litigation.
Finally, it is clear that Dee Engineering was a fairly close case, in light of the heavy burden needed to justify a transfer. Even modest differences among facts and circumstances in different cases can produce different outcomes, especially when district courts are asked to exercise their discretion. In this case, West Coast Metric has not met its burden of showing that a transfer would be clearly more convenient overall, or that a transfer would be in the interests of justice.
For the foregoing reasons, West Coast Metric's motion to transfer is hereby denied.
So ordered.