NFR, LLC et al v. NFC, LLC, No. 3:2015cv00367 - Document 10 (E.D. Va. 2015)
Court Description: MEMORANDUM OPINION. Signed by Senior District Judge James R. Spencer on 08/17/2015. (tjoh, )
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NFR, LLC et al v. NFC, LLC Doc. 10 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF VIRGINIA RICHMOND DIVISION NFR, LLC, et al., Plaintiffs, v. Action No. 3:15-CV-367 CORIZON HEALTH, INC., Defendant. MEMORAN D U M OPIN ION THIS MATTER is before the Court on a Motion to Transfer (“Motion”) filed by Corizon Health, Inc. (“Defendant”). ECF No. 3. Defendant seeks to transfer this case to the Tallahassee Division of the United States District Court for the Northern District of Florida pursuant to 28 U.S.C. 140 4(a). Plaintiffs NFR, LLC/ d/ b/ a Nursefinders of Richm ond, NFNN, LLC d/ b/ a Nursefinders of Newport News, NFC. LLC d/ b/ a Nursefinders of Charlottesville, NFRO, LLC d/ b/ a Nursefinders of Roanoke, (“the Virginia Plaintiffs”), NFSC, LLC d/ b/ a Nursefinders, Nursefinders of J acksonville, LLC, Nursefinders of Pensacola, LLC, Nursefinders of Tam pa, LLC, Nursefinders of Northern Florida, LLC (“the Florida Plaintiffs”) (collectively, “Plaintiffs”) oppose the Motion. For the reasons stated below, the Court will DENY Defendant’s Motion. I. FACTU AL AN D PROCED U RAL BACKGROU N D On March 20 , 20 15, Plaintiffs filed a Com plaint against Defendant in Chesterfield County, Virginia Circuit Court, seeking $ 198, 432 in com pensatory dam ages on the grounds that Defendant allegedly breached its contract with Plaintiffs. Subsequently, Defendant rem oved the case to this Court. ECF No. 1. On J uly 6, 20 15, Defendant filed the instant Motion. Plaintiffs filed a response on J uly 17, 20 15. Defendants filed a reply on J uly 23, 20 15. Plaintiffs are all lim ited liability com panies. Plaintiffs adm itted, by stipulation, that “all of the m em bers of each plaintiff entity are citizens of either Virginia or Florida.” ECF No. 1 Ex. 1 Dockets.Justia.com B (“Pls.’ Stipulation”) ¶ 4. Defendant is a Delaware corporation with its principal place of business in Brentwood, Tennessee. ECF No. 1, Ex. C (“Def.’s Stipulation”) ¶¶ 3-4. Plaintiffs are a group of health care professional staffing com panies in Virginia and Florida. Specifically, they are in the business of em ploying nurses and other health care professionals for tem porary placem ent at its custom ers’ facilities. Defendant is a private correctional healthcare provider, which provides health care services to 110 locations in Florida. On April 30 , 20 13, the parties entered into an agreem ent whereby Plaintiffs would provide nursing professionals to Defendant on a tem porary basis (the “April Agreem ent”). The April Agreem ent identified all Plaintiffs and Defendant as parties to the contract and was signed by Grace Perkinson (“Ms. Perkinson”), whose title is “Area Director,” and Stuart Cam pbell, who is COO of Defendant. The April Agreem ent provides for: (i) paym ent of invoices on a net 45 basis; (ii) the assessm ent of interest at the rate of one and one-half percent (1.5%) per m onth on all am ounts not paid within thirty (30 ) days; and (iii) reasonable attorney's fees for the cost of collection. Further, the April Agreem ent gave Defendant the option of perm anently hiring Plaintiffs’ nurses at a fee of 30 % of the nurse’s annual salary (“buy-out fee”). In m id-August 20 13, the parties began negotiating a separate agreem ent for nurse staffing in Florida (“the Florida Agreem ent”). On August 12, 20 13, Defendant requested language for the Florida Agreem ent providing a 30 -day grace period from the tim e Defendan t transitioned into a Florida correctional facility during which Defendant would not incur a buy-out fee if it hired any nurses from Plaintiffs. The proposed language is as follows: Once Corizon transition[s] into each Florida DOC facility, there will exist a 30 day grace period for all current staff and disciplines listed on Exhibit-B (Bill Rates) in which Corizon can hire staff personnel directly and incur no buyout fees. After the 30 day grace period is elapsed the conversion fee of 30 % of the em ployees’ annual salary will apply. Com plaint (“Com pl.”) ¶ 22. The Florida Agreem en t contains the 30 -day grace period. On August 21, 20 14, Ms. Perkinson, on behalf of the Florida Plaintiffs executed the Florida 2 Agreem ent. The Florida Plaintiffs, but not the Virginia Plaintiffs, are parties to the Florida Agreem ent. The Florida Agreem ent, which Defendant received from the Florida Plaintiffs, also contained a separate, appended Business Associate Contract. See Com plaint (“Com pl.”) ¶ 24. The signatory for Defendant m istakenly believed that the appended docum ent contained the sole signature block for the Florida Agreem ent and the Business Associate Contract. On Septem ber 6, 20 13, Defendant’s signatory executed that signature block and returned it to the Florida Plaintiffs “believing and intending that he had executed the Florida Agreem ent with his signature.” Defendant’s Mem orandum In Support of Motion to Transfer by Corizon Health, Inc. (“Def.’s Mem .”) at 3 n.2. Thus, Defendant returned a signed copy of the related Business Associate Contract but did not provide a signed copy of the Florida Agreem ent from Defendant. On Septem ber 6, 20 13, Plaintiffs responded to Defendant’s earlier em ail, which requested the inclusion of the 30 -day grace period language. Plaintiffs’ response via em ail reads as follows: I will have m y legal departm ent review the additional verbiage for this contract; I will get it back as soon as possible. I do have a concem . In m y Tallahassee Branch I have been told from m y m anager there, that Corizon is hiring all Nursefinder nurses and this contract has not been signed yet. In this contract we gave you a 30 day grace period to start after contract has been signed. I need som e clarification on this m atter. Please advise. Com pl. ¶ 23. Subsequently, Defendant hired fourteen (14) of the eighteen (18) nurses to work at correctional facilities in Florida. Plaintiffs alleged that Plaintiffs “supplied its nursing personnel to [Defendant] pursuant to the April Agreem ent. . . . [and Defendant] hired [Plaintiffs’] nursing personnel on a perm anent basis for em ploym ent, entitling [Plaintiffs] to the agreed-upon Placem ent Fee.” Id.¶¶ 36-37. 1 Plaintiffs further allege that they subm itted invoices to Defendant for placem ent fees owed and Defendant has failed to tim ely pay the balance. Id. ¶ 39. 1 Defendant argues that Plaintiffs “do not and cannot allege that any of the nurses [Defendant] hired to work in Florida were either em ployed by any of the Virginia [Plaintiffs], or working or located in Virginia at the tim e [Defendant] hired them .” Defendant’s Mem orandum In Support of Motion to 3 II. LEGAL STAN D ARD Pursuant to 28 U.S.C. § 140 4, “[f]or the convenience of parties and witnesses, in the interest of justice, a district court m ay transfer any civil action to any other district or division where it m ight have been brought.” 28 U.S.C. § 140 4(a). “The decision whether to transfer an action under the statute is com m itted to the sound discretion of the district court.” Heinz Kettler GM BH & Co. v. Razor USA, LLC, 750 F. Supp. 2d 660 , 668 (E.D. Va. 20 10 ) (citing One Beacon Ins. Co. v. JNB Storage Trailer Rental Corp., 312 F. Supp. 2d 8 24, 828 (E.D. Va. 20 0 4)). District courts determ ining whether to grant a m otion to transfer under § 140 4(a) to a transferee forum where the action could initially have been brought “typically consider[]: (1) plaintiff’s choice of forum , (2) convenience of the parties, (3) witness convenience and access, and (4) the interest of justice.” Id. (citing JTH Tax, Inc. v. Lee, 482 F. Supp. 2d 731, 736 (E.D. Va. 20 0 7)). “The m ovant bears the burden of showing that transfer is proper.” JTH Tax, 482 F. Supp. 3d at 736 (citing Cognitronics Im aging Sy s. v. Recognition Research, Inc., 83 F. Supp. 2d 689, 696 (E.D. Va. 20 0 0 )). The party seeking transfer bears the burden of proving “that the circum stances of the case are strongly in favor of transfer.” Jones v. Frazier, No. 1:0 9cv513, 20 0 9 WL 260 1255, at *8 (E.D. Va. Aug. 18, 20 0 9) (em phasis added). “In considering a m otion for intra-district transfer, [courts] generally look to the sam e factors relevant to m otions for change of venue under 28 U.S.C. § 140 4(a).” C.T. v. Liberal Sch. Dist., No. 0 6-20 93-J WL, 20 0 8 WL 489330 , at *1 (D. Kan. Feb. 20 , 20 0 8). III. PARTIES’ ARGU MEN TS a. D e fe n d an t Defendant argues that each prong of the test for transfer pursuant to section 140 4(a) is satisfied in this case. Defendant asserts that this action initially could have been brought in the Transfer by Corizon Health, Inc. (“Def.’s Mem .”) at 4. Further, Defendant argues that “Plaintiffs also do not appear to allege that [Defendant] hired any of the eighteen nurses outside of the 30 -day grace period.” Id. 4 Tallahassee Division of Northern District of Florida because Plaintiffs’ breach of contract claim arises from actions occurring in Florida, and because Defendant—by virtue of allegedly contracting with Florida to provide healthcare services to Florida’s correctional facilities and hiring eighteen (18) nurses without paying buy-out fees—is subject to personal jurisdiction in the transferee forum . Second, Defendant acknowledges that a plaintiff’s choice of forum is entitled to deference, but argues that, here, Plaintiffs’ choice of forum in Virginia is not entitled to an y weight because the breach of contract claim has a weak connection to the forum . Defendant argues that Plaintiffs cannot establish that the cause of action has a “legitim ate connection to the district” because of the following reasons: (1) the activity giving rise to Plaintiffs’ claim s all occurred in Florida; (2) none of the Virginia Plaintiffs are parties to the Florida Agreem ent; (3) and none of the nurses hired by Defendant worked at any of the Virginia Plaintiffs. Def.’s Mem . at 8 (quoting Pragm atus AV, LLC v. Facebook, Inc., 769 F. Supp. 2d 991, 995 (E.D. Va. 20 11)). Thus, Defendant argues that given the claim ’s weak connection to Virginia, this Court should not give this factor any weight. Next, Defendant argues that transfer to the Tallahassee Division of the Northern District of Florida is warranted because the transferee forum is m ore convenient for the parties and is where the overwhelm ing m ajority of witnesses reside. Defendant asserts that convenience of the parties weighs heavily in favor of transfer because none of the Virginia Plaintiffs are parties to the Florida Agreem ent while the Florida Plaintiffs are indeed parties to the Florida Agreem ent. Defendant additionally asserts that “hard copy docum ents are . . . located at [Defendant’s] facilities in Florida.” Id. Furtherm ore, Defendant argues that the convenience to non-party witnesses favors transfer because approxim ately twenty (20 ) critical witnesses for Defendant are located in or near Florida. These non-party witnesses include eighteen nurses that Defendant hired from the Florida Plaintiffs, with sixteen of them residing in Florida. Defendant asserts that the non-party witnesses are a source of testim ony evidence as they “can testify to the date 5 that [Defendant] hired them and the correctional facility where Defendant assigned them which m ay be dispositive as to whether [Defendant] is liable under the Florida Agreem ent.” Id. at 9 (citing Courtney Decl. ¶¶ 4, 6-8). According to Defendant, the non-party witnesses include various executives of Defendant, who will testify regarding Defendant’s contract discussions with Plaintiffs, the staffing of the correctional facilities in Florida, and the lack of any com plaints of invoices from Plaintiffs until m onths after the nurses were hired. Id. According to Defendant, because the vast m ajority of evidence and witnesses are located in or near the transferee forum , the costs of attending trial in the Northern District of Florida would be m inim al from both a tim e and cost perspective. Further, Defendant argues that if this case proceeds in this Court, it is likely that neither party would be able to com pel the attendance of the Florida witnesses at trial because the subpoena power granted under Federal Rule of Civil Procedure 45(c)(1) does not extend to witnesses who live or work over 10 0 m iles from the Eastern District of Virginia. Finally, Defendant asserts that the interest of justice strongly favors transferring this action to the Northern District of Florida because the transferee forum has a strong, legitim ate, and localized interest in the case. For all these reasons, Defendant argues that transfer to the Tallahassee Division of the Northern District of Florida is appropriate pursuant to 28 U.S.C. § 140 4(a). b. Plain tiffs ’ Op p o s itio n Plaintiffs only take issue with whether Defendant satisfies its burden to show that the circum stances of the case “are strongly in favor of transfer.” Plaintiffs’ Mem orandum in Opposition to Corizon Health, Inc.’s Motion to Transfer (“Pls.’ Opp’n.”) at 3. They note that their choice of forum should be accorded deference and argue that such deference should be substantial in light of the fact that this action was filed in their hom e forum . Say Plaintiffs, “The April Agreem ent, as well as the Florida Agreem ent, were discussed and negotiated exclusively 6 between Grace Perkinson for Nursefinders in Virginia 2 and Ms. Christina Ray on behalf of [Defendant].” Id. at 3 (em phasis in original). Moreover, Plaintiffs argue that Defendant’s Motion is not well-grounded because “when and where the individual nurses were hired by Defendant in Florida is not expected to be in dispute.” Id. at 1. Instead, they argue that “this case turns entirely on what the respective corporate entities agreed to as the “operative” contract.” Id. Next, as to the convenience of the parties, Plaintiffs argue Virginia is clearly a m ore convenient forum for Plaintiffs because it is the forum in which all its operations are m anaged and where Ms. Perkinson is located. Plaintiffs argue that transfer is not appropriate where it would m erely shift the burden from Defendan t to Plaintiffs. Additionally, Plaintiffs acknowledges that the convenience of witnesses is an im portant factor in the transfer calculus and correctly notes that convenience to non-party witnesses is afforded greater weight than convenience of party witnesses. In sum , Plaintiffs essentially argue that the relevance of each potential witness and the im portance of their live testim ony should be considered by the Court. Finally, with respect to the interests of justice, Plaintiffs argue that this Court has an interest in providing a forum for its residents, that this District will resolve this action m uch m ore quickly than the transferee forum will, and that the choice of law consideration weighs in favor or m aintaining the case in this Court. Specifically, they argue that, although several of the Florida Plaintiffs are incorporated in Florida, they are operated out of the office of BK Developm ent in Midlothian, Virginia, and thus are entitled to treatm ent as a local business. For all these reasons, Plaintiffs assert that Defendant fails to m eet its burden to show that the circum stances of this case strongly favor transfer. 2 Contrary to Plaintiffs’ assertion that Ms. Perkinson negotiated the Florida Agreem ent on behalf of all the Plaintiffs, the nam es of the parties explicitly listed in that agreem ent are only those of the Florida Plaintiffs. See Def.’s Mem . Ex. 2 at 4. 7 IV. AN ALYSIS In assessing the relevant factors under 28 U.S.C. § 140 4(a), the Count will now determ ine whether Defendant m eets its burden of proving “that the circum stances of the case are strongly in favor of transfer.” Heinz, 750 F. Supp. 2d at 667 (quoting Jones v. Frazier, No. 1:0 9cv513, 20 0 9 WL 260 1355, at 8 (E.D. Va. Aug. 18, 20 0 9) (em phasis added). a. Tran s fe re e Fo ru m as In itial Fo ru m Transfer is appropriate in those districts where the plaintiff could have properly filed the action initially. See Hoffm an v. Blaski, 363 U.S. 335, 343-44 (1960 ). The record indicates and the parties do not dispute that this action could have been brought in the Tallahassee Division of the Northern District of Florida. b. Plain tiffs ’ Ch o ice o f Fo ru m A plaintiff’s choice of forum is entitled to “‘substantial weight, especially where the chosen forum is the plaintiff’s hom e forum or bears a substantial relation to the cause of action.” Heinz, 750 F. Supp. 2d at 667 (citing Koh v. M icrotek Int 7, Inc., 250 F. Supp. 2d 627, 633 (E.D. Va. 20 0 3)). This choice m ay “be overcom e only when the private and public interest factors clearly point toward trial in the alternative forum .” Piper Aircraft Co. v. Rey no, 454 U.S. 235, 255 (1981). However, the actual weight given to a plaintiff’s choice varies considerably “in proportion to the connection between the forum and the cause of action.” GTE W ireless, Inc. v. Qualcom m , Inc., 71 F. Supp. 2d 517, 519 (E.D. Va. 1999). The weight given to the plaintiff’s initial choice is dim inished when the operative facts of the case have little relation to the chosen forum . Bd. of Trs. V. Sullivant Ave. Props., LLC, 50 8 F. Supp. 2d 473 (E.D. Va. 20 0 7); see also GTE W ireless, 71 F. Supp. 2d at 519 (“When a plaintiff chooses a foreign forum and the cause of action bears little or no relation to that forum , th e plaintiff’s chosen venue is not entitled to such substantial weight.”) (citing Verosol B.V. v. Hunter Douglas Inc., 80 6 F. Supp. 582, 589 (E.D. Va. 1992). 8 Plaintiffs’ entities are either located in Virginia (corporately) or m anaged in Virginia. Therefore, Plaintiffs chose their hom e forum . As such, substantial deference is accorded to said choice. Pursuant to the claim s and allegations in the Com plaint, the prim ary legal issue in the instant case is which of the two contracts was operative at the tim e of the alleged breach of contract. Indeed, both agreem ents were negotiated by Ms. Perkinson, who was located in Virginia. c. Co n ve n ie n ce o f th e Partie s an d N o n -Party W itn e s s e s 1. Convenience to the Parties In assessing this factor, courts generally consider “ease of access to sources of proof, the cost of obtaining the attendance of witnesses, and the availability of com pulsory process.” Sam sung, 386 F. Supp. 2d at 717 n.13. Convenience to parties alone will rarely justify transfer, particularly where transfer would m erely “‘shift the balance of inconvenience’ from defendant to plaintiff.” Bay lor, 70 2 F. Supp. at 1258 (quoting Eastern Scientific M arketing v. Tekna-Seal Corp., 696 F. Supp. 173, 180 (E.D. Va. 1988)). However, “it is the ‘balance’ of convenience which is in question,” and courts m ust determ ine whether the total convenience of the parties favors transfer. M edicenters of Am ., Inc. v. T & V Realty & Equip. Corp., 371 F. Supp. 1180 , 1184 (E.D. Va. 1974) (citing N izin v. Bright, 342 F. Supp. 48 9 (S.D.N.Y. 1971)). Plaintiffs argue that transfer would m erely shift inconvenience to them from Defendant. The Court agrees with Plaintiffs in this regard. Virginia would clearly be m ore convenient for Plaintiffs. However, transferring the case to Florida would sim ply flip the convenience of the parties in favor of Defendant. In conclusion, Defendant has not established a strong reason to transfer as to this factor. 2. Non-Party Witness Convenience Witness convenience is of “considerable im portance” in determ ining whether a transfer pursuant to section 140 4(a) is appropriate. Sam sung, 386 F. Supp. at 718. 9 “The party asserting witness inconvenience has the burden to proffer, by affidavit or otherwise, sufficient details respecting the witnesses and their potential testim ony to enable the court to assess the m ateriality of evidence and the degree of inconvenience.” com Score, Inc. v. Integral Ad Sci., Inc., 924 F. Supp. 2d 677, 688 (E.D. Va. 20 13) (quoting Sam sung, 38 6 F. Supp. 2d at 718). “Additionally, the m oving party m ust dem onstrate ‘whether that witness is willing to travel to a foreign jurisdiction.’” Id. at 719 (quoting Thay er/ Patricof Educ. Funding, LLC v. Pry or Res., Inc., 196 F. Supp. 2d 21, 33 (D.D.C. 20 0 2)). Defendant correctly notes that, in assessing this factor, courts draw a distinction between party witnesses and non-party witnesses, giving less weight to inconvenience im posed on party-witnesses. See Def.’s Reply at 7. Defendant identifies eighteen (18) nurses (who were hired out of tem porary to perm anent status, all of whom live in or near Florida) as potential witnesses. However, the relevant inform ation regarding these nurses is if and when they were hired by Defendant as perm anent nurses and at what annual salary. All of that relevant inform ation would likely be available in docum entary form in the files of Defendant. Therefore, this factor weighs in favor of Plaintiff. d. In te re s ts o f Ju s tice In evaluating whether the interest of justice weighs in favor of transfer, the Court looks to “the public interest factors aim ed at system ic integrity and fairness.” Heinz Kettler, 750 F. Supp. 2d at 669-70 (quoting By erson v. Equifax Info. Servs., LLC, 467 F. Supp. 2d 627, 635 (E.D. Va. 20 0 6)). “The m ost prom inent elem ents of system ic integrity are judicial econom y and the avoidance of inconsistent judgm ents.” Id. Sim ilarly, “[f]airness is assessed by considering factors such as docket congestion, the interest in having local controversies decided at hom e, knowledge of applicable law, unfairness with burdening forum citizens with jury duty, and interest in avoiding unnecessary conflicts of law.” Id. This factor is a wash for several reasons. The Federal Courts in both Virginia and 10 Florida are quite capable of applying the appropriate states’ contract law and resolving the case efficiently. V. CON CLU SION Given the deference due to Plaintiffs’ choice of forum and Defendant’s failure to persuade the Court that the relevant factors “strongly favor” transfer, the Motion to Transfer will be DENIED. ECF No. 3. Let the Clerk send a copy of this Mem orandum Opinion to all counsel of record. An appropriate Order shall issue. ENTERED this _ 17th_ ____________________/s/_________________ James R. Spencer Senior U. S. District Judge day of August 20 15. 11
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