Pandora Franchising, LLC v. Kingdom Retail Group, LLLP
299 Ga. 723
| Ga. | 2016Background
- Pandora Franchising, a foreign LLC authorized to do business in Georgia, listed its principal place of business as Maryland on its Georgia filings.
- Kingdom Retail sued Pandora in Thomas County Superior Court alleging wrongful withholding of consent related to franchise transfers and invoked OCGA § 14-2-510(b)(4) (venue where cause of action originated).
- OCGA § 14-2-510(b)(4) grants venue where the cause of action originated but also provides that if venue rests solely on that paragraph, the defendant may remove the action to “the county in Georgia where the defendant maintains its principal place of business.”
- Pandora sought removal to Gwinnett County, claiming that was its Georgia principal place of business because its registered office/agent was there. The trial court allowed removal over Kingdom’s objection.
- The Court of Appeals reversed; the Supreme Court granted certiorari to decide whether “principal place of business” in (b)(4) means a company’s single worldwide headquarters (nerve center) or may mean a separate Georgia principal office. The Supreme Court affirmed the Court of Appeals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does OCGA § 14-2-510(b)(4) allow removal to a county in Georgia based on a company’s Georgia office (even if its global HQ is outside Georgia)? | Kingdom: (plaintiff) removal right is limited; (b)(4) allows removal only to county containing the company’s single worldwide principal place of business if that is in Georgia. | Pandora: (defendant) statute permits removal to county where the defendant maintains its Georgia principal place of business (e.g., registered office), regardless of worldwide HQ. | Held: “Principal place of business” means the company’s single worldwide headquarters/nerve center; removal under (b)(4) is only to that Georgia county if the HQ is in Georgia. |
| Does the placement of the phrase “in Georgia” alter meaning so that it refers only to a Georgia office rather than the single principal place of business? | Kingdom: placement shows legislature meant only to permit removal if the single principal place of business is located in Georgia. | Pandora: phrase should be read as modifying “principal place of business in Georgia.” | Held: Court presumes legislature’s wording deliberate; absence of phrase “in this state” after the term elsewhere indicates removal is limited to a worldwide principal place of business located in Georgia. |
| Is the company’s registered office relevant to removal under (b)(4)? | Kingdom: Registered office matters for other venue subsections but not for removal under (b)(4). | Pandora: Registered office in Gwinnett County establishes its Georgia principal place of business for removal. | Held: Registered office is irrelevant to (b)(4); the statute’s text points to a company’s single principal place of business (nerve center). |
| Would Pandora’s interpretation permit forum-shopping or manipulation? | Kingdom: Allowing removal to any Georgia office invites manipulation and undermines the statutory purpose to curb venue-shopping. | Pandora: A factual inquiry into where the company’s most important Georgia activities occur should govern. | Held: Court rejects Pandora’s view as promoting forum-shopping; a single-nerve-center approach is administrable and consistent with legislative intent. |
Key Cases Cited
- Fed. Deposit Ins. Corp. v. Loudermilk, 295 Ga. 579 (2014) (statutory text must be read naturally and reasonably)
- Hertz Corp. v. Friend, 559 U.S. 77 (2010) ("principal place of business" = corporation’s nerve center where high-level officers direct, control, and coordinate activities)
- Kingdom Retail Group v. Pandora Franchising, 334 Ga. App. 812 (2015) (Court of Appeals opinion adopting the nerve-center construction and reversing trial court removal)