Opinion
01cv10123 (GBD)
February 4, 2002
MEMORANDUM OPINION ORDER
Plaintiff, a corporation located in California, commenced this action in this Court for breach of contract on November 16, 2001. Later that same morning, defendant Xerox Corporation, located in Rochester, New York, commenced a similar action in the United States District Court for the Western District of New York. Plaintiff moves for a preliminary injunction to prevent defendant from prosecuting its action in the Western District. Defendant opposes this motion and cross-moves for transfer of this action to the Western District.
Under the "first filed" rule, where actions involving the same issue are brought in separate district courts, the court in the earlier filed action has the authority to enjoin the prosecution of the later filed action. City of New York v. Exxon Corp., 932 F.2d 1020, 1025 (2d Cir. 1991) (citing Meeropol v. Nizer, 505 F.2d 232, 235 (2d Cir. 1974)). See also National Equipment Rental, Ltd. v. A.L. Fowler, 287 F.2d 43, 45 (2d Cir. 1961). However, the court may disregard the first filed rule where "special circumstances" give priority to the later filed action. Exxon Corp., 932 F.2d 1020, 1025 (quoting William Gluckin Co. v. International Playtex Corp., 407 F.2d 177, 178 (2d Cir. 1969)). These special circumstances are essentially the same as those considered on a motion to transfer under 28 U.S.C. § 1404 (a) and include "(1) the place where the operative facts occurred; (2) the convenience to the parties; (3) the convenience of the witnesses; (4) the relative ease of access to sources of proof; (5) the availability of process to compel attendance of witnesses; (6) the plaintiffs choice of forum; (7) the forum's familiarity with the governing law; and (8) trial efficiency and the interests of justice." APA Excelsior III v. Premiere Technologies, Inc., 49 F. Supp.2d 664, 667 (S.D.N.Y. 1999). Moreover, where both suits are filed close to the same time, courts have given less weight to the first filed rule. See, e.g., Don King Productions, Inc. v. Douglas, 735 F. Supp. 522, 532 (S.D.N.Y. 1990) (citations omitted). Courts disfavor rewarding parties for winning a "`race to the courthouse,' as is frequently the case when the first-filed suit is a declaratory judgment action filed in anticipation of the later-filed action." Id.
After weighing the relevant factors, this Court concludes that the Southern District is the proper forum for this action. Given the nature of this contractual dispute, the access to proof and availability of witnesses does not warrant disturbing the plaintiff's choice of forum. "The convenience of both party and nonparty witnesses is probably considered the single most important factor" in this Court's analysis.Aerotel, Ltd. v. Sprint Corp., 2000 WL 381423, *7 (S.D.N.Y. April 13, 2000). The contract between the parties specifies that "[l]itigation arising from or relating to this Agreement shall be brought in the Federal or state courts of the State of New York." Agreement ¶ 15a. If defendant had intended to restrict jurisdiction to the Western District of New York, it could have sought to contractually do so. Plaintiff acted within its contractual rights and duties when it filed this action in the Southern District of New York. "[A]lthough a permissive forum selection clause is entitled to less weight than a mandatory one, the fact that both parties initially accepted the jurisdiction of the courts of New York must count. A forum selection clause is determinative of the convenience of the parties." Orix Credit Alliance, Inc. v. Mid-South Materials Corporation, 816 F. Supp. 230, 234 (S.D.N.Y. 1993) (citations omitted). Plaintiff is located in California and must bear the burden and expense of prosecuting this action in a New York forum. Therefore, defendant does not have a compelling argument that it would be too burdensome for it to defend this action in New York City from its offices in Rochester. Furthermore, since it is the later filed action which seeks a declaratory judgment, this is not an instance where the first filed rule should be disregarded because plaintiff won a "race to the courthouse." Don King Productions, 735 F. Supp. 522, 532.
For the foregoing reasons, plaintiff's motion for a preliminary injunction preventing defendant from prosecuting this dispute in the Western District of New York is granted. Defendant's cross-motion to transfer this case to the Western District of New York is denied.