United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION AND ORDER
BARBARA M. G. LYNN, CHIEF JUDGE
the Court is Defendants' Motion to Dismiss or Transfer
Venue (ECF No. 6). For the reasons stated below, the Motion
Procedural and Factual Background
September 15, 2016, Braintree Laboratories, Inc. and its
subsidiary Affordable Pharmaceuticals (collectively
“Braintree”) sent a demand letter to Bedrock
Logistics, LLC, asserting that Bedrock had engaged in a
deceptive kickback scheme to obtain and maintain business
with Braintree. Braintree's letter included an offer of
settlement to avoid litigation, with a response deadline of
September 26, 2016. On September 19, 2016, instead of
settling or otherwise responding, Bedrock filed suit in Texas
state court, seeking collection of its invoices owed by
Braintree. On September 27, 2016, Braintree filed suit
against Bedrock in federal court in Massachusetts. On October
4, 2016, Braintree removed the Texas state court action to
this Court. Bedrock then moved to transfer the Massachusetts
action to this Court pursuant to 28 U.S.C. § 1404(a).
The Massachusetts federal court denied that motion, holding
that the § 1404(a) factors weighed against transfer to
Texas, and rejecting Bedrock's first-to-file argument.
Braintree Labs., Inc. v. Bedrock Logistics, LLC,
16-11936-IT, 2016 WL 7173755 (D. Mass. Dec. 8, 2016). The
parties will thus continue to litigate a case in
Massachusetts involving the same transactions and witnesses
at issue here. On November 8, 2016, Braintree moved to
dismiss this case for lack of personal jurisdiction, or, in
the alternative, to transfer this action to the District of
Massachusetts (ECF No. 6). Bedrock argues that venue is
proper here, and that the first-to-file rule prevents
transfer to the District of Massachusetts.
district court may transfer a civil action to any other
district or division where it might have been brought. 28
U.S.C. § 1404(a). In the Fifth Circuit, a district court
is to grant transfer if the party seeking a change of venue
has demonstrated that the transferee venue “is clearly
more convenient” than the plaintiff's chosen venue.
In re Volkswagen of Am., Inc., (Volkswagen
II ) 545 F.3d 304, 311 (5th Cir. 2008) (en banc). A
court must consider a number of private and public interest
factors when analyzing a motion to transfer venue. The
private interest factors include: “(1) the relative
ease of access to sources of proof; (2) the availability of
compulsory process to secure the attendance of witnesses; (3)
the cost of attendance for willing witnesses; and (4) all
other practical problems that make trial of a case easy,
expeditious and inexpensive.” In re Volkswagen
AG, (Volkswagen I ) 371 F.3d 201, 203 (5th Cir.
2004). The public interest factors include: (1) the
administrative difficulties flowing from court congestion;
(2) the local interest in having localized interests decided
at home; (3) the familiarity of the forum with the law that
will govern the case; and (4) the avoidance of unnecessary
problems regarding conflict of laws or the application of
foreign law. Id. A plaintiff's choice of venue
is not a distinct factor in the § 1404(a) analysis, but
“when the transferee venue is not clearly more
convenient than the venue chosen by the plaintiff, the
plaintiff's choice should be respected.”
Volkswagen II, 545 F.3d at 311. The parties do not
dispute that the suit could have been filed in the District
of Massachusetts. Thus, the Court must determine whether, in
the interests of justice, the private and public interest
factors support a transfer to the District of Massachusetts.
first-to-file rule provides that when related cases are
pending in two district courts, the court with the
later-filed action can refuse to hear the case, if the issues
raised by both cases “substantially overlap.”
Cadle Co. v. Whataburger of Alice, Inc., 174 F.3d
599, 603 (5th Cir. 1999). The first-to-file rule is a
discretionary doctrine, the aim of which is to “avoid
the waste of duplication, to avoid rulings which may trench
upon the authority of sister courts, and to avoid piecemeal
resolution of issues that call for a uniform result.”
Save Power Ltd. v. Syntek Fin. Corp., 121 F.3d 947,
950 (5th Cir. 1997). However, courts may choose not to apply
the first-to-file rule when compelling circumstances exist.
Mann Mfg., Inc. v. Hortex, Inc., 439 F.2d 403, 407
(5th Cir. 1971).
circumstances exist when the first action was an anticipatory
suit, meaning it was designed to preempt the second
filer's suit and to secure the first filer's forum
choice. See Raz Imports, Inc. v. Luminara Worldwide,
LLC, No. 3:15-CV-02223-M, 2015 WL 6692107, at *3 (N.D.
Tex. Nov. 3, 2015) (Lynn, J.). Anticipatory suits
“deprive a potential plaintiff of his choice of forum,
and are also one of the compelling circumstances courts cite
when declining to apply the first-filed rule.”
Paragon, 2008 WL 3890495, at *4. In these cases,
deferring to the plaintiff's choice of forum incentivizes
and rewards the winner of a race to the courthouse.
Id. Courts thus disfavor anticipatory suits as
constituting improper forum-shopping. See Mission Ins.
Co. v. Puritan Fashions Corp., 706 F.2d 599, 602 n.3
(5th Cir. 1983).
typically decides personal jurisdiction questions before
considering any venue challenges. However, if there is a
sound prudential justification for doing so, a court may
reverse the normal order. See Leroy v. Great W. United
Corp., 443 U.S. 173, 180 (1979) (explaining that
“neither personal jurisdiction nor venue is
fundamentally preliminary”). Here, “resolution of
the venue issue renders the personal jurisdiction problem
moot and avoids the need to address constitutional questions.
It is thus appropriate to consider venue as an initial
matter.” Nuttall v. Juarez, 984 F.Supp.2d 637,
642 (N.D. Tex. 2013) (Lynn, J.).