Melaleuca, Inc. v. Organo Gold Int'l Inc. et al - Document 53
MEMORANDUM DECISION AND ORDER ON MOTION TO DISMISS AND IN THE ALTERNATIVE, MOTION FOR TRANSFER OF VENUE denying 29 Motion to Dismiss for Lack of Jurisdiction. Signed by Judge Larry M. Boyle. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by krb)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
MELALEUCA, INC., an Idaho
Case No. 4:10-CV-420-LMB
ORGANO GOLD INT’L, a Washington
Limited Liability Company; HOLTON
BUGGS, an individual; DOES 1through
25 and DOES 26 through 30,
MEMORANDUM DECISION AND
ORDER ON MOTION TO
DISMISS AND IN THE
ALTERNATIVE, MOTION FOR
TRANSFER OF VENUE (Dkt. No.
Currently pending before the Court is Defendant Holton Buggs’ Motion to Dismiss
and In the Alternative, Motion for Transfer of Venue (Dkt. No. 29). The Court heard oral
argument on June 15, 2011, and took the motion under advisement. Having considered
the parties’ arguments and written submissions, the Court issues the following
Memorandum Decision and Order denying the motion.
The Court will set forth the underlying facts as alleged in Plaintiff’s Amended
Complaint. The following are alleged facts only and this recitation should not be
MEMORANDUM DECISION AND ORDER 1
interpreted by the parties as a finding of fact by the Court in any respect. However, as set
forth on pages five and six hereafter, in ruling on the pending motion to dismiss, the
Court must take the uncontroverted factual allegations as true.
Plaintiff Melaleuca, Inc. is a consumer goods company, based in Idaho Falls,
Idaho, and operating in approximately 15 countries. Amend. Cmplt., ¶ 1. It employs more
than 1,500 people in Idaho and over 2,700 people around the world. Id.
Melaleuca sells its consumer goods products directly to customers but with the
help of independent contractors called Marketing Executives (“ME”). Id. at 15.
Marketing Executives earn commissions from Melaleuca by referring customers and by
training, motivating or otherwise supporting other Marketing Executives in their efforts to
refer customers. Id. at 17.
Each Melaleuca Marketing Executive has a “Marketing Organization” made up of
customers referred by that Marketing Executive, other Marketing Executives he or she
supports, as well as the customers they each referred and Marketing Executives they each
support, and so on “down the line.” Id. at 18.
Marketing Executives sign an Independent Marketing Executive Application and
Agreement, which incorporates the Melaleuca Statement of Policies. Id. at 21. Included
amongst these policies is a Proprietary Information and Trade Secrets clause governing
certain Melaleuca information accessed by the Marketing Executives, and a Nonsolicitation and Conflicts of Interest clause prohibiting Marketing Executives from
MEMORANDUM DECISION AND ORDER 2
soliciting Melaleuca customers or other Marketing Executives for competing business.
Id. at ¶¶ 22 & 23.
Defendants Organo Gold Int’l Inc., a Nevada corporation, and Organo Gold
International, LLC, a Washington limited liability corporation (collectively “Organo”),
are together a newly incorporated “network marketing” company that is also selling
household products. Id. at ¶¶ 7 & 25. According to the Organo website, Defendant
Holton Buggs, a Texas resident, is the Vice President of Sales for Organo, a “Crown
Diamond Marketing Associate”1 and Organo’s “top earner.”2 Id. at 8.
Plaintiff alleges that Organo, in a conspiracy with Defendant Buggs, is expanding
its company by unlawfully duplicating “key portions” of Melaleuca’s business model,
using its proprietary information, and “raiding” its Marketing Executives and customers.
Allegations of Defendant Buggs’ Actions
From September 2008 to August 2009, Defendant Buggs was a Melaleuca
Preferred Customer.3 Id. at 35. As a Preferred Customer, he had access to Melaleuca
meetings where he would have interacted with other Melaleuca Marketing Executives and
customers, and would have or should have been aware of Melaleuca’s non-solicitation
Ograno’s “Marketing Associate” position appears to be analogous to Melaleuca’s
Marketing Executive role. A “Crown Diamond Marketing Associate” is one ....
The citation boasts Buggs’ earnings as over $4 million. See Response (Dkt. 37),
Statement of Facts, ¶ B.16.
A Preferred Customer commits to a certain amount of products ordered and
receives eligibility for certain discounts on services. Amend. Cmplt., ¶ 16.
MEMORANDUM DECISION AND ORDER 3
policy applicable to its Marketing Executives. Id.
In or around May or June 2009, Defendant Buggs, along with a then Melaleuca
Marketing Executive Jose Ardon, hosted a meeting at Buggs’s home in Houston, Texas,
which was attended by other then currently contracted Melaleuca Marketing Executives
including Sandra Zapata, Alberto Godinez, Marcela Hinojosa and her husband, and Rosa
Chavez. Response to Holton Buggs’s Motion to Dismiss and in the Alternative, Motion
for Transfer of Venue (Dkt. 37) (“Response”), Statement of Facts, ¶¶ 2 -3; Affidavit of
Sonia Schuetz in Support of Response to Holton Bugg’s Motion to Dismiss or Transfer
(Dkt. 37-4) (“Scheutz Affid.”), ¶ 6. During the meeting, Buggs made a presentation to the
group about Organo, asked the attendees to “join” Organo, and encouraged them to solicit
other Marketing Executives in their individual Marketing Organizations to join Organo.
Response, Statement of Facts, ¶¶ 2-5. Afterward, Jose Ardon and at least one of the
attendees cancelled his or her Melaleuca account and enrolled as an Organo Marketing
Associate “down the chain” from Defendant Buggs. See id. at ¶ 10; Amend. Cmplt. ¶¶
38- 42. Accordingly, Defendant Buggs received income from the enrollment of the
former Melaleuca Marketing Executives and their customers. See id. at ¶ 43.
After the former Melaleuca Marketing Executives became members of Organo,
Buggs (with Organo) encouraged them to solicit other then current Maleleuca Marketing
Executives to become Organo Marketing Associates, using their Melaleuca customer
information and in violation of their non-solicitation agreements. Id. at ¶ 44. Plaintiff
MEMORANDUM DECISION AND ORDER 4
alleges that Defendants had knowledge of the agreements and intended to “reap the
benefits” of their breaches. Id. at ¶¶ 44; 48 - 51.
Plaintiff alleges that Defendant Buggs has assisted Organo in systematically
soliciting hundreds of Melaleuca Marketing Executives to become Organo Marketing
Executives, id. at 45, and offered financial incentives to induce them into breaching their
Melaleuca non-solicitation and confidential obligations. See generally Amend. Cmplt.
Plaintiff attributes the exodus of dozens of individuals from Melaleuca to Organo to
Buggs’s and Organo’s cooperative unlawful activities.4
Plaintiff brings four causes of action against Defendants: One - Tortious
Interference with Contractual Relations; Two - Tortious Interference with Prospective
Economic Advantage; Three - Unfair Competition; and Four - Civil Conspiracy. Plaintiff
initiated this action in Idaho District Court in Bonneville County, and Defendants
removed to this Court.
Defendant Buggs has moved pursuant to 28 U.S.C. § 1406(a) and Fed. R. Civ. P.
12(b)(2) and (3) to dismiss this action for lack of personal jurisdiction over Defendant
Buggs and improper venue. Alternatively, he requests a change of venue to his home
Melaleuca filed state court actions against several of these former Melaleuca
Marketing Executives – Jose Ardon, Arturo Nazario, Donaciano Martinez, Sonia Alfaro,
Nora Alfaro, John and Blanca Sachtouras and Marcel Hinojosa, which are currently
pending in Bonneville County, Idaho. Amend. Cmplt., ¶¶ 3-4.
MEMORANDUM DECISION AND ORDER 5
state of Texas for the convenience of the parties and the witnesses, and in the interest of
justice. 28 U.S.C. § 1404(a) and/or 1406(a).
MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION
Standard of Law for Motion to Dismiss
In ruling on this motion, the Court must take the Plaintiff’s uncontroverted
allegations in the Amended Complaint as true and resolve factual disputes in affidavits in
its favor. See Dole Food Co., Inc. v. Watts, 303 F.3d 1104, 1108 (9th Cir. 2002).
However, where Defendant has offered evidence in support of its motion to dismiss,
Plaintiff may “not simply rest on the bare allegations of its complaint.” Amba Mktg. Sys.,
Inc. v. Jobar Int’l, Inc., 551 F.2d 784, 787 (9th Cir. 1977); see Data Disk, Inc. v. Sys.
Tech. Assocs., 557 F.2d 1280, 1284 (9th Cir. 1977) (holding that the Court “may not
assume the truth of allegations in a pleading which are contradicted by affidavit”). In that
instance, Plaintiff must “come forward with facts, by affidavit or otherwise,” in response
to Defendant’s version of the facts. Amba Mktg. Sys., Inc., 551 F.2d at 787. Factual
conflicts, however, must be decided in Plaintiff’s favor in deciding whether a prima facie
case for personal jurisdiction has been met. Mattel, Inc. v. Greiner and Hausser GMBH,
354 F.3d 857, 862 (9th Cir. 2003).
Plaintiff seeks to invoke this Court’s jurisdiction, and therefore bears the burden of
establishing that the Court has personal jurisdiction over Defendant Buggs. Hirsch v.
Blue Cross, Blue Shield of Kansas City, 800 F.2d 1474, 1477 (9th Cir. 1986); Rano v.
MEMORANDUM DECISION AND ORDER 6
Sipa Press, Inc., 987 F.2d 580 (9th Cir. 1995). If the Court decides the matter on
affidavits and depositions – without an evidentiary hearing – Plaintiff need only establish
a prima facie showing of jurisdictional facts to withstand a motion to dismiss. Ballard v.
Savage, 65 F.3d 1495 (9th Cir. 1995). But the issue remains alive for trial where Plaintiff
must prove personal jurisdiction by a preponderance of the evidence. Rano, 987 F.2d at
587 n. 3.
In order for a district court to exercise personal jurisdiction over a defendant in a
diversity of citizenship lawsuit, the plaintiff must show (1) that the forum’s long-arm
jurisdiction statute confers jurisdiction over the defendant, and (2) that the exercise of
jurisdiction comports with federal constitutional principles of due process. Haisten v.
Grass Valley Medical Reimbursement Fund, Ltd., 784 F.2d 1392, 1396 (9th Cir. 1986);
Lake v. Lake, 817 F.2d 1416,1420 (9th Cir. 1987). The Ninth Circuit Court of Appeals
addressed the standard under the Idaho long-arm statute in Lake v. Lake, 817 F.2d 1416,
1420 (9th Cir. 1987):
The Idaho long-arm statute provides that a person is subject to personal
jurisdiction if, among other things, he transacts business or commits a tortious
act in Idaho and the alleged cause of action arises from that transaction or act.
Idaho Code § 5-514 (1979). The Idaho legislature, in adopting that statute,
intended to exercise all the jurisdiction available to the State of Idaho under
the due process clause of the United States Constitution.
Lake, 817 F.2d at 1420 (citing Doggett v. Electronics Corp. of Am., 93 Idaho 26, 30, 454
P.2d 63, 67 (1969)). Because “the state and federal limits are coextensive,” id., this court
must focus its inquiry on whether the exercise of jurisdiction comports with the
MEMORANDUM DECISION AND ORDER 7
constitutional principles of due process. See id.
Due process requires that a defendant have certain “minimum contacts” with the
forum state such that the exercise of personal jurisdiction “does not offend the traditional
notions of fair play and substantial justice.” Lake, 817 F.2d at 1420 (citing Milliken v.
Meyer, 311 U.S. 457, 463, 61 S. Ct. 339, 343 (1940)). These contacts may be established
in one of two ways – by satisfying either the general jurisdiction test, or the specific
jurisdiction test. Lake, 817 F.2d at 1420; Hirsch, 800 F.2d at 1477. If a defendant’s
contact with the forum is “continuous and systematic,” or “substantial,” the court may
exercise jurisdiction over the defendant “generally,” regardless of whether the cause of
action arises out of the contact. Lake, 817 F.2d at 1420 (citing Perkins v. Benguet
Consol. Mining Co., 342 U.S. 437, 445, 447 (1952); Hirsch, 800 F.2d at 1478 (citations
omitted)). Alternatively, if a defendant’s contact with the forum is less substantial, but
the cause of action arises out of the forum related-activity, a court may exercise
jurisdiction specific to that forum contact, so long as this limited exercise is otherwise
constitutional. Lake, 817 F.2d at 1420; Hirsch, 800 F.2d at 1478.
The standard for establishing general jurisdiction is “fairly high,” and paramount
to establishing a physical presence in the forum. Brand v. Menelove Dodge, 796 F.3d
1070, 1073 (9th Cir. 1986); Gates Learjet Corp. v. Jensen, 743 F.2d1325, 1331 (9th Cir.
MEMORANDUM DECISION AND ORDER 8
1984). Plaintiff argues that, based on Organo’s and Buggs’s representations of Buggs
with respect to his success and business activities as an highly compensated, successful
international marketing representative for Organo, with approximately 60,000 distributors
world-wide, Buggs should be subject to the general jurisdiction of this court. Plaintiff
argues further that it is highly likely that Defendant Buggs has substantial contacts
directly with Idaho in his role as Organo’s Vice President of Sales who has “built and
mentored a team in excess of 100,000.” See Response to Holton Buggs’s Motion to
Dismiss and in The Alternative, Motion for Transfer of Venue (Dkt. 37)(hereafter
“Response”), Statement of Facts, ¶ 1.
The Court makes no finding and expresses no opinion whether Holton Buggs’
national and/or international activities could result in continuous and systematic, or
substantial, enough contacts with Idaho for this court to exercise general jurisdiction. At
this point in time, the record as to Buggs’ activities and role with Organo in Idaho is
somewhat speculative, and therefore, insufficient to establish a prima facie case of
general jurisdiction in this district.
Specific, or limited, jurisdiction is established through a three-part analysis. The
plaintiff has the burden of making a prima facie showing on the first two factors: (1) that
the nonresident defendant purposefully directed its activities or consummated some
transaction with the forum or residents of the forum; or performed some act which
MEMORANDUM DECISION AND ORDER 9
purposefully avails itself of the privilege of conducting activities in the forum, thereby
invoking the benefits and protections of its laws; and (2) the claim arises out of or relates
the defendant’s forum-related activities. Lake, 817 F.2d at 1421 (citing Burger King
Corp. v. Rudzewicz, 471 U.S. 462, 472-76 (1985)).
The “purposeful availment” requirement ensures that a defendant will not be haled
into court in a jurisdiction solely as a result of random, fortuitous, or attenuated contacts.
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985)(internal quotations omitted).
When a defendant commits an act purposefully directed at a specific individual or
company from which a claim arises, it is reasonable for the defendant to anticipate being
haled into court in the forum of that target. See Burger King Corp. v. Rudzewicz, 471
U.S. 462, 476 (1985); Haisten, 784 F.2d at 1397; Lake, 817 F.2d at 1421. The Ninth
Circuit has explained:
[W]ithin the rubric of “purposeful availment” the Court has allowed the
exercise of jurisdiction over a defendant whose only “contact” with the forum
state is the “purposeful direction” of a foreign act having effect in the forum
state. See, e.g., Calder v. Jones, 465 U.S. 783, 789, 104 S.Ct. 1482, 1487, 79
L.Ed.2d 804 (1984). Moreover, jurisdiction may be exercised with a lesser
showing of minimum contact than would otherwise be required if
considerations of reasonableness dictate. Burger King Corp. v. Rudzewicz, 471
U.S. 462, 105 S.Ct. 2174, 2184, 85 L.Ed.2d 528 (1985). Finally, there is a
presumption of reasonableness upon a showing that the defendant purposefully
directed his activities at forum residents which the defendant bears the burden
of overcoming by presenting a compelling case that jurisdiction would be
unreasonable. Id. 105 S.Ct. at 2185.
Haisten, 784 F.2d at 1397. Accordingly, once the plaintiff has met its burden, and shown
that a defendant purposefully directed its activities at the forum and that the claim arose
MEMORANDUM DECISION AND ORDER 10
out of those forum activities, the burden shifts to the defendant to make a “compelling
case” that the exercise of jurisdiction in the forum would be unfair or unreasonable. Id.;
Lake, 817 F.2d at 1422 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 - 78
(1985); Fields, 796 F.2d at 302)).
Buggs’ minimum contacts with Idaho are sufficient for the Court
to exercise personal jurisdiction over him arising out these
This court is of the opinion that Plaintiff has made a prima facie case showing that
this Court has specific jurisdiction over Defendant Buggs based on his purposeful
activities directed at Melaleuca, an Idaho company, and with the consequences and/or
effects of his activities resting in Idaho. See Haisten, 784 F.2d at 1397. Taking the
undisputed allegations of the complaint as true, Holton Buggs solicited specifically
Melaleuca Marketing Executives and correspondingly, their customers, successfully
induced them to leave Melaleuca and to join Organo, which caused financial harm to
Melaleuca, an Idaho resident. The Court does not believe that whether or not Defendant
Buggs knew Melaleuca was an Idaho company is dispositive on the issue.5 It is enough
that he knew that the Marketing Executives he recruited, along with their customers, were
Melaleuca Marketing Executives and customers. See Lake, 817 F.2d at 1421.
Plaintiff points out that Melaleuca Preferred Customer Agreement, which Buggs
signed, prominently displays Melaleuca’s Idaho Falls, Idaho, address, and that the address
is published in numerous locations which Buggs, in his role as Vice President of Sales for
Organo, would have seen. Defendant Buggs claims he had no actual knowledge that
Melaleuca is an Idaho company until the filing of this lawsuit.
MEMORANDUM DECISION AND ORDER 11
On that point, there is a factual dispute. Defendant Buggs denies knowledge of a
Melaleuca involvement with two of the Marketing Executives specifically named in the
Complaint as having attended the meeting at his home in Texas. See Declaration of
Holton Buggs, (Dkt. 29-2), ¶¶ 18-20. He also states that he has no recollection of meeting
the other Marketing Representatives who were in attendance. Id. Buggs’s statement does
not specifically contradict the Plaintiff’s allegations that he knew other Marketing
Executives and/or customers he allegedly recruited, or the rest of the attendees at the
meeting in his home, were then contracted with Melaleuca. Further, Plaintiff submitted an
affidavit to contradict Buggs’s testimony regarding his knowledge of the attendees’
involvement with Melaleuca, see Affidavit of Sandra Zapata (“Zapata Affid.”) (Dkt. 374), ¶¶ 6-7, as well as sufficient circumstantial evidence regarding his role with Organo
including expansion strategy to increase sales, experience in the industry, the industry
practice generally and Buggs’ former relationship with Melaleuca as a Preferred
Customer, pending litigation in state court with Melaleuca and the number of former
Melaleuca Marketing Executives who left Melaleuca and joined Organo “down the line”
from Buggs to reasonably infer that Buggs knew or should have known the Marketing
Executives he was soliciting were Melaleuca Marketing Executives. See, e.g., Amend.
Cmplt., (Dkt. 10), ¶¶ 1, 12, 13, 27 -29, 31 -33, 35, 36, 43, 44, 46, 48 - 50, 55, 57, 58, 61 &
62; Response (Dkt. 37), Statement of Facts, ¶¶ 1 - 5, 7, 8, 10, 11, 13, 16, 17, 20 - 25.
MEMORANDUM DECISION AND ORDER 12
In deciding this motion, the Court must resolve these factual discrepancies in
Plaintiff’s favor. Mattel, Inc. v. Greiner and Hausser GMBH, 354 F.3d 857, 862 (9 th Cir.
2003). The Court does so, and therefore finds that Plaintiff has presented a prima facie
case at this stage in the proceeding that supports Buggs’s knowledge that he was recruiting
Melaleuca Marketing Executives and customers.
The Court finds the Plaintiff’s allegations sufficient to establish a prima facie case
of the necessary minimum contacts with Idaho for the Court to exercise personal
jurisdiction over Defendant Buggs.
The claims against Defendant Buggs arise out of his contacts with
Plaintiff’s complaint alleges claims against Defendant Buggs that arise directly out
of his contact with and solicitation of the Melaleuca Marketing Executives and their
customers. Accordingly, Plaintiff has met its burden of establishing the second factor
under the specific jurisdiction analysis.
Defendants have not made a compelling case that exercising
jurisdiction over Defendant Buggs in Idaho is unreasonable or
Having found that Plaintiff set forth a prima facie case of the first two elements of
personal jurisdiction, Defendant has the burden to rebut the presumption of reasonableness
of litigating the case in this forum by a compelling case against reasonableness. See
Haisten, 784 F.2d at 1397. There are seven factors the Court must consider in determining
MEMORANDUM DECISION AND ORDER 13
(1) the burden on the defendant, (2) existence of an alternative forum, (3)
convenient and effective relief for the plaintiff, (4) the forum state's interest in
adjudicating the suit, (5) efficient resolution of the controversy, (6) purposeful
interjection, and (7) conflicts with sovereignty.
Lake, 817 F.2d at 1421-22 (citing Brand v. Menlove Dodge, 796 F.2d 1070, 1075 (9th
Cir. 1986); Pacific Atlantic Trading Co. v. The M/V Main Express, 758 F.2d 1325,
1329-31 (9th Cir.1985)). “These considerations sometimes serve to establish the
reasonableness of jurisdiction upon a lesser showing of minimum contacts than would
otherwise be required.” Id. (quoting Burger King, 471 U.S. at 477, 105 S.Ct. at 2184).
The Court has considered each factor and finds that Defendants have not presented
a compelling case that Idaho is an unreasonable forum within which to conduct these
proceedings. Plaintiff is an Idaho corporation. There are three defendants – Organo Gold
Int’l Inc., Organo Gold International LLC and Buggs. The two corporate defendants
reside in bordering states of Idaho – Washington and Nevada, and together operate an
international marketing corporation. Buggs is a Texas resident, the Vice President of
Sales and top earner of Organo, and travels nationally and internationally routinely as part
of his business activities. Defendant Buggs’ counsel, who appeared personally at the
motion hearing, resides in California.6 There appear to be witnesses residing in all of the
aforementioned states, as well as Michigan. See Affidavit of Michael LaClare in Support
Mathew Nguygen and Scott Wellman, from the law firm of Wellman and Warren
with an address in Laguna Hills, California, have appeared pro hac vice on behalf of
Defendant Buggs, and appeared personally to argue Defendant’s motion to dismiss.
MEMORANDUM DECISION AND ORDER 14
f Response to Holton Bugs’s Motion to Dismiss or Transfer, Exh. P (Dkt. 93-3, p. 2)
(Organo Gold’s Initial Disclosure Statement); Exh. S (Dkt. 93-3, p. 23) (Plaintiff’s Initial
Disclosure Statement). Accordingly, Idaho is no less reasonable a forum than Texas
when weighing all of the factors and considering the various locations of all of the
parties, witnesses and counsel involved in this litigation. The Court also concludes that air
travel from Texas to Idaho is a particularly compelling burden for Defendant Buggs based
on the record before it.
The Court is of the opinion that Idaho has as much, if not more, of an interest in
this litigation, given that the claims involve an alleged systematic “raiding” of employees
from one of its corporate residents, and significant employers. Buggs’s purposeful
introjection into the forum is discussed above, and does not provide a compelling reason
against the reasonableness of Idaho as the forum. Nor do either of the remaining factors –
the judicial systems interest in the efficient resolution of controversies and the states’
shared interests in furthering fundamental social policies – weigh significantly in favor of
Texas over Idaho.
Accordingly, the Court finds that Defendants failed to present a compelling case
against the reasonableness of this Court’s jurisdiction over this action. Accordingly,
Defendant Buggs’s motion to dismiss for lack of personal jurisdiction is denied.
MEMORANDUM DECISION AND ORDER 15
MOTION TO DISMISS FOR IMPROPER VENUE
Defendant also moves to dismiss this action under Fed. R. Civ. P. 12(b)3 and 28
U.S.C. § 1406(a), which provide that the Court may dismiss an action for improper venue.
The federal venue statute provides:
A civil action wherein jurisdiction is founded only on diversity of citizenship
may, except as otherwise provided by law, be brought only in (1) a judicial
district where any defendant resides, if all defendants reside in the same State,
(2) a judicial district in which a substantial part of the events or omissions
giving rise to the claim occurred, or a substantial part of property that is the
subject of the action is situated, or (3) a judicial district in which any defendant
is subject to personal jurisdiction at the time the action is commenced, if there
is no district in which the action may otherwise be brought.
28 U.S.C. § 1391(a).
Defendant argues that neither defendant is an Idaho resident, and that a substantial
portion of the events in this action occurred in Texas. Motion to Dismiss (Dkt 29-1), at p.
10. It is undisputed that no defendant resides in Idaho. However, the record before the
Court at this time does not establish that a substantial portion of the events in this action
occurred in any one forum. Accordingly, neither subsection (1) or (2) of the federal
venue statute is met, and the court may properly determine venue under subsection (3).
Organo has personally appeared without objection to personal jurisdiction, and the Court
concluded herein that Plaintiff has made a prima facie showing that Defendant Buggs is
also subject to personal jurisdiction in Idaho. Accordingly, subsection (3) of the statute is
met, thus establishing proper venue in Idaho, see 28 U.S.C. § 1391(a), and Defendant’s
motion to dismiss for improper venue is also denied.
MEMORANDUM DECISION AND ORDER 16
MOTION FOR CHANGE OF VENUE
Standard of Law
“For the federal court system, Congress has codified the doctrine [of forum non
conveniens] and has provided for transfer, rather than dismissal, when a sister federal
court is the more convenient place for trial of the action.” Sinochem Intern. Co. Ltd. v.
Malaysia Intern. Shipping Corp., 549 U.S. 422, 430, 127 S.Ct. 1184, 167 L.Ed.2d 15
(2007). Section 1404(a) of chapter 28 U.S.C. provides that “[f]or 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.” Under this
statute, the moving party must show (1) that the proposed transferee court possesses
subject matter jurisdiction over the action, (2) the parties would be subject to personal
jurisdiction in the transferee court, and (3) venue would have been proper in the
transferee court. Hoffman v. Blaski, 363 U.S. 335, 344, 80 S.Ct. 1084, 4 L.Ed.2d 1254
(1960); A.J. Indus., Inc. v. United States Dist. Ct. for the Cent. Dist. of Cal., 503 F.2d
384, 386 (9th Cir.1974).
Once these threshold requirements are met, this Court must weigh the following
factors to determine whether transfer is appropriate: (1) plaintiff's choice of forum; (2)
convenience of the parties; (3) convenience of the witnesses and availability of
compulsory process; (4) ease of access to the evidence; (5) feasibility of consolidation of
other claims; (6) familiarity of each forum with the applicable law; (7) any local interest
MEMORANDUM DECISION AND ORDER 17
in the controversy; and (8) the relative court congestion and time to trial in each forum.
Decker Coal, 805 F.2d at 843.
The factors the Court must consider for a request for change of venue for forum
non-conviens are the same as, or similar to, those the Court considered above in assessing
the reasonableness of Idaho as the forum state. Considering each of these factors
including the residence of each party, location of all witnesses, etc., for the same reasons
discussed above, the Court concludes also that Texas is no more a convenient forum for
this litigation than Idaho. In addition, the Court concludes that Defendant has not shown
that either forum is more familiar with the applicable law, or more or less congested such
that the trial date in this matter would be impacted by its choice. Accordingly, the Court
also denies Defendant’s request for change of venue.
For the foregoing reasons,
IT IS HEREBY ORDERED that Defendant Holton Buggs’s Motion to Dismiss
and In the Alternative, Motion for Transfer of Venue (Dkt. 29) is DENIED.
DATED: August 9, 2011.
Honorable Larry M. Boyle
United States Magistrate Judge
MEMORANDUM DECISION AND ORDER 18