ORDER ON MOTION FOR CHANGE OF VENUE
In this Fair Labor Standards Act (FLSA) and Maine Overtime Law case, the Court denies the employer’s motion for change of venue to where it is headquartered because the employer failed to demonstrate that transfer would be in the interests of justice or for the convenience of the parties and witnesses.
I. STATEMENT OF FACTS
On October 27, 2010, Ernest E. Johnson, III and Brian S. Prindle filed a class action lawsuit against VCG Holding Corporation (VCG), alleging that, although they and others were VCG employees, VCG had failed to comply with the FLSA and state of Maine Overtime Law. Convpl. (Docket # 1). On December 9, 2010, VCG moved for change of venue to the United States District Court for the District of Colorado. Def. VCG Corp.’s Mot. to Transfer Venue to the Dist. of Colorado (Docket # 8) (VCG Mot.). On January 4, 2011, the Plaintiffs objected. Resp. of Pls. to Def.’s Mot. to Transfer Venue (Docket # 14) (Pis’ Opp’n.). On January 14, 2011, VCG replied. Def. VCG’s Reply Br. in Support of its Mot. to Transfer to Dist. of Colorado (Docket # 15) CVCG Reply).
II. THE PARTIES’ POSITIONS
A. VCG’s Position
VCG moves to transfer this cause of action to the District of Colorado, saying that Colorado is “the district where VCG is incorporated, the location where it principally conducts its business and where the majority of the witnesses and documents material to this dispute are located.”
VCG Mot.
at 1. Citing caselaw, VCG says that venue is often moved in FLSA cases to the district where the employer has its headquarters if the original forum state does not have a strong interest in the outcome.
Id.
at 4-5. VCG observes that its corporate and business structure is based in Colorado, not Maine.
Id.
at 5-6. It admits that as a holding company, VCG owns stock, membership or partnership interests in a variety of nightclubs, including KenKev II, Inc. (KenKev), a Maine corporation which does business under the name
B. The Plaintiffs’ Response
In their opposition, the Plaintiffs dispute VCG’s contention that a plaintiffs choice of forum is less significant in a FLSA case. Pl.’s Opp’n. at 2-3. Instead, they cite caselaw in which courts have concluded that Congress intended a plaintiffs choice of forum to be a significant factor in FLSA lawsuits. Id. The Plaintiffs also point out that, although it is true that the District of Maine will be inconvenient for VCG’s witnesses, the District of Colorado would be equally inconvenient for the Plaintiffs and their Maine witnesses. Id. at 3. They contend that about fifty of the one hundred and sixty potential opt-in plaintiffs are closer to Maine than to Colorado and that in any case, representative testimony is typically allowed in the First Circuit. Id. Furthermore, they note that the two known representatives are in Maine, that it is speculative where the ultimate opt-in plaintiffs will come from, and that a Colorado forum would be markedly inconvenient for the known plaintiffs. Id. at 4. Regarding document production, the Plaintiffs minimize the inconvenience of the actual location of- the documents since most will be reduced to an electronic format. Id. at 4-5.
Conceding that Colorado has an interest in policing corporate compliance with its laws, the Plaintiffs argue that this interest is counterbalanced by Maine’s interest in policing its own labor laws. They observe that part of the case involves Maine law and that Maine has an interest both in VCG’s compliance with its state statutes and the protection of Maine residents working in Maine for out of state businesses. Id. at 5. Finally, the Plaintiffs distinguish the cases VCG cites. Id. at 6-7.
C. VCG’s Reply
In reply, VCG points out that the Plaintiffs failed to supply any affidavits or documents in support of their factual contentions and VCG urges the Court to accept as proven for purposes of the motion to transfer, the facts as VCG set them out in its motion.
VCG Reply
at 1-2. VCG refutes the Plaintiffs’ assertion that FLSA
III. DISCUSSION
A. General Principles
Under 28 U.S.C. § 1404(a), a district court is authorized “[f]or the convenience of the parties and witnesses,” to transfer any civil action to any other district or division where it might have been brought. The burden of proving the propriety of a transfer lies with the party seeking it.
Coady v. Ashcraft & Gerel,
The United States Supreme Court has advised district courts to consider both “private concerns” and “public interest factors” in exercising their § 1404(a) discretion.
Stewart,
B. Potential Jurisdiction of the Transferee District
A preliminary question is whether the lawsuit could have been brought in the proposed transferee district.
Hoffman v. Blaski,
C. Plaintiffs Choice of Forum
Traditionally, the plaintiffs choice of forum is a factor that weighs in favor of the plaintiff in evaluating a motion for transfer of venue. In
Piper Aircraft Co. v. Reyno,
VCG’s contention that district courts routinely transfer FLSA lawsuits to the district where the employer is headquartered when the forum does not have a strong interest in the outcome of the dispute is less convincing. VCG relies on
Ingram v. Family Dollar Stores of Ala., Inc.,
CV-06-BE-1507-S,
In addition to citing Ingram, VCG footnotes six cases in support of its proposition that district courts “routinely transfer nationwide FLSA collective actions to the district wherein the defendant corporation maintains its headquarters when the forum does not have a strong interest in the outcome of the dispute.” Def.’s Mot. at 4. A careful review of those cases reveals that they stand on their own facts, which invariably involved transferor districts with less interest in the dispute than Maine has here.
In
Earley v. BJ’s Wholesale Club, Inc.,
No. 06 Civ. 3529CWHP),
VCG cites
Dole v. Diversified Collection Services, Inc.,
No. 88 C 1693,
Freeman v. Hoffmann-La Roche Inc.,
No. 06 Civ. 13497(RMB)(RLE),
VCG’s fourth cited case is
Montgomery v. TAP Enterprises, Inc.,
No. 06 CV 5799(HB),
VCG’s fifth and sixth cases are
Neil Brothers, Ltd. v. World Wide Lines, Inc.,
Even if these cases reflect a trend to transfer actions when the chosen forum does not have a strong interest in a FLSA dispute, the trend is not convincing because Maine has a stronger interest in this dispute than the transferor districts in any of those cases. Unlike the plaintiffs in Earley, Coen, and Montgomery, Messrs. Johnson and Prindle both reside in the forum state. Unlike the plaintiffs in Montgomery, they have also identified other witnesses who reside in the forum state. Furthermore, Messrs. Johnson and Prindle do not have a presence in the proposed transferee district as the DOL had in Dole and as one of the plaintiffs had in both Coen and Montgomery. Finally, there is no suggestion that an identical action is pending in a different district like in Ingram and Dole.
Observing that the FLSA provides an “opt-in” procedure under 29 U.S.C. § 216(b), other courts have concluded that “Congress intended to give plaintiffs considerable control over the bringing of an FLSA action”.
Alix v. Shoney’s, Inc.,
No. 96-2812 Section “R” (1),
D. Convenience of the Parties and the Witnesses
Both Plaintiffs reside in the state of Maine and would be inconvenienced if the lawsuit were transferred to the District of Colorado. VCG is incorporated in Colorado, has its headquarters in Colorado, and many (but not all) of its executives reside in Colorado. 2 It would be inconvenienced if the case were not transferred to Colorado. On its face, this issue is neutral.
The parties have fenced over where the likely, non-party witnesses and “opt-ins” reside and whether they would be more inconvenienced by traveling to Maine or Colorado. The Plaintiffs point out that in the First Circuit, only a small minority of representative plaintiffs are required to actually testify.
Pl.’s Opp’n.
at 3 (citing
Sec’y of Labor v. DeSisto,
The Declaration of Micheál Ocello establishes that KenKev, the corporation that directly operates PT’s Showclub Portland “is managed by Paul Clement, a Maine resident,” and that Mr. Clement is “responsible for all day-to-day managerial activities, such as hiring and firing, establishing policies and procedures, and management of all employees, including persons operating in positions similar to Plaintiffs’ position in the Portland, Maine, location.” Ocello Decl. ¶ 13. Mr. Ocello acknowledges that each VCG business, including KenKev in Maine, maintains records for its employees at its respective location, but he says that IEC, which is located in Lakewood, Colorado, processes KenKev’s payroll. Id. ¶ 15, 29. As the case is currently postured, Mr. Clement’s testimony and KenKev’s books will be essential for the Maine Plaintiffs’ case. This factor slightly favors the Plaintiffs.
E. Availability of Documents
One factor the First Circuit has directed district courts to evaluate is the availability of documents.
Cianbro Corp. v. Curran-Lavoie, Inc.,
Mr. Ocello pointed to one set of documents that VCG and its owned businesses continue to maintain in paper format: employment files. Id. ¶ 29. According to Mr. Ocello, “[e]ach VCG business maintains its own employment files for its employees at their respective locations,” and “[a] copy of each employment file is also maintained by IEC at its business location in Lakewood, Colorado.” Id. Due to the burden of moving those paper files from their respective locations, the dispersion of the employment files slightly favors VCG.
Otherwise, in general, VCG records and books are maintained in Colorado. See Def.’s Mot. at 9. However, KenKev also maintains its own books, records, and payroll in Portland. Def.’s Mot. Attach. 8, Decl. of Marlene Danner ¶ 10 (Danner Decl.). Because KenKev’s documents are kept in Maine and Colorado, this factor is neutral to the extent KenKev is the only VCG-owned business involved in this action. However, because other VCG-owned businesses may well become involved, VCG’s central maintenance of all corporate documents, including paper copies of employment files, in Colorado slightly favors transfer. At the same time, the Court does not give this factor much overall weight in light of its decreasing relevance.
F. The Order in Which Jurisdiction Was Obtained
Another factor may be the order in which jurisdiction was obtained. Where there are two cases pending in different jurisdictions, the First Circuit has adopted the “first-filed” rule.
Coady,
G. Docket Congestion
VCG presents statistics from the AO indicating that the length of disposition for civil matters is slightly less in Colorado than in Maine.
Def.’s Mot.
at 10. This is a proper factor to evaluate. Federal Practice and Procedure § 3847.
See Coady,
H. District’s Familiarity With Governing Law
A district’s familiarity with the governing law is an appropriate factor to consider.
Van Dusen,
IV. CONCLUSION
Though VCG has good reasons to have this case transferred to Colorado, the Plaintiffs have good reasons to have this case remain where it was brought. On balance, VCG has not convinced the Court that the factors favor transfer and therefore the Court DENIES Defendant VCG Corporation’s Motion to Transfer Venue to the District of Colorado (Docket # 8).
SO ORDERED.
Notes
. Neither case is helpful more generally on the issue of transfer presented here.
Neil Brothers
involved a patent dispute between a British and a Tennessee business that had been filed in the Eastern District of New York. Again, other than some sales, there was no apparent connection with New York state.
Neil Bros.,
. Micheál Ocello, the President of VCG, acknowledged that his primary office is in Sauget, Illinois; he works out of the Denver office about twenty days each year. Def.’s Mot. Attach. 8, Decl. of Micheal Ocello ¶ 4 (Ocello Decl.).
. Mr. Ocello’s Declaration says that VCG owns nineteen entities. Ocello Decl. ¶ 18. Six are in Colorado; one in California; five in Illinois; one in Florida; one in Indiana; one in Kentucky; one in Minnesota; one in North Carolina; one in Texas; and one in Maine. Id. Mr. Ocello's Declaration also describes the likely VCG witnesses and he concludes that of the twenty-six likely VCG witnesses, fourteen reside in Colorado, six in Illinois, one resided in Maine, and five reside in other areas of the country from Texas to North Carolina. Id. II 32.
