United States District Court, E.D. Texas, Sherman Division
MEMORANDUM OPINION AND ORDER
L. MAZZANT UNITED STATES DISTRICT JUDGE.
before the Court is Defendants' Motion to Dismiss, or in
the Alternative, to Transfer Venue (Dkt. #11). Having considered
the relevant pleadings, the Court finds that Defendants'
motion should be denied.
January 2011, Plaintiff Dong Sik You a/k/a James Yoo
(“Yoo”) and Defendant Kook Bin Im a/k/a Benny Im
(“Benny Im”) discussed an investment proposition
in Dallas, Texas. In February 2011, Yoo and Benny Im entered
into an oral agreement (“AMPM Agreement”) to
purchase the ARCO AMPM gas station Store No. 83031 located at
3601 Center Street, Tacoma, Washington, 98409 (“AMPM
Business”). The seller of the AMPM Business was Harbor
Olympic Land 5911 LLC (“Harbor Olympic”). At the
time of these discussions, both Yoo and Benny Im were
residents of Dallas, Texas.
the AMPM Agreement, Yoo agreed to invest $250, 000 for the
purchase and operation of the AMPM Business and Benny Im
agreed to manage the day-to-day operations. Yoo and Benny Im
were entitled to equal shares of any profit made from the
AMPM Business. Under the AMPM Agreement, Yoo agreed to allow
Benny Im to register the AMPM Business in Defendant Benny
Tac, Inc.'s (“Benny Tac”) name, because Benny
Tac was an authorized ARCO AMPM franchisee.
about April 2011, James Yoo transferred $250, 000
(“2011 Investment”) to Harbor Olympic, on behalf
of Benny Im to purchase the AMPM Business in Benny Tac's
name pursuant to the AMPM Agreement. Soon after, Benny Im
moved to Washington and began to manage the day-to-day
operations of the AMPM Business. On or about July 2012, Yoo
transferred an additional $100, 000 (“2012
Investment”) to Benny Im to make improvements to the
about September 2013, Benny Im informed Yoo that the AMPM
Business was losing money and not marketable. He also advised
Yoo that they should terminate the AMPM Business. Soon
thereafter, Yoo agreed to let Benny Im and Benny Tac
terminate the AMPM Business. At that time, Yoo did not seek
compensation for his 2011 Investment and 2012 Investment in
the AMPM Business.
around November 2016, Yoo discovered through an acquaintance
that Benny Im had purchased a night club, The Cuff Complex,
located at 1533 13th Avenue, Seattle, Washington 98122,
allegedly using the proceeds from the AMPM Business
(“The Cuff Complex Agreement”). The Cuff Complex
Agreement was finalized on or around July 1, 2015. James Yoo
was unaware of The Cuff Complex Agreement and did not receive
any interest from The Cuff Complex Agreement.
23, 2017, Plaintiff filed his Complaint against Defendants
(Dkt. #1). That same day, Plaintiff filed his Amended
Complaint asserting claims for breach of contract, breach of
fiduciary duty, fraud, fraud by nondisclosure, conversion,
and unjust enrichment (Dkt. #4).
October 2, 2017, Defendants filed their Motion to Dismiss
(Dkt. #11). On October 16, 2017, Plaintiff filed his response
(Dkt. #18). On October 23, 2017, Defendants filed their reply
(Dkt. #19). Defendants move, in the alternative, for the
Court to transfer venue to the Western District of Washington
for the convenience of the parties.
Motion to Dismiss for Lack of Personal Jurisdiction -
nonresident defendant's minimum contacts with the forum
state can establish either specific jurisdiction or general
jurisdiction. Specific jurisdiction exists if the Court
determines that (1) the foreign defendant purposely directed
his activities at residents of the forum state, and (2) the
cause of action arose from or is connected with such
activities. Burger King v. Rudzewicz, 471 U.S. 462,
472-73 (1985). “General jurisdiction, on the other
hand, will attach where the nonresident defendant's
contacts with the forum state, although not related to the
plaintiff's cause of action, are ‘continuous and
systematic.'” Alpine View Co. v. Atlas Copco
AB, 205 F.3d 208, 215 (5th Cir. 2000) (citing
Helicopteros Nacionales de Colombia, S.A. v. Hall,
466 U.S. 408, 415- 16 (1984)).
jurisdiction exists where the plaintiff alleges a cause of
action that grows out of or relates to the contacts between
the defendant and the forum state. Helicopteros, 466
U.S. at 414 n.8. The Fifth Circuit has concluded that
“specific jurisdiction is a claim-specific inquiry:
‘A plaintiff bringing multiple claims that arise out of
different forum contacts of the defendant must establish
specific jurisdiction for each claim.'” McFadin
v. Gerber, 587 F.3d 753, 759 (5th Cir. 2009) (quoting
Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d
266, 271 (5th Cir. 2006)).
Fifth Circuit follows a three-step analysis in determining
whether a court has specific personal jurisdiction:
“(1) whether the defendant has minimum contacts with
the forum state, i.e., whether it purposely directed its
activities toward the forum state or purposefully availed
itself of the privileges of conducting activities there; (2)
whether the plaintiff's cause of action arises out of or
results from the defendant's forum-related contacts; and
(3) whether the exercise of personal jurisdiction is fair and
reasonable.” McFadin, 587 F.3d at 759 (quoting
Seiferth, 472 F.3d at 271). “The
‘minimum contacts' inquiry is fact intensive and no
one element is decisive; rather the touchstone is whether the
defendant's conduct shows that it ‘reasonably
anticipates being haled into court.'” Id.
(quoting Luv N' Care, Ltd. v. Insta-Mix, Inc.,
438 F.3d 465, 470 (5th Cir. 2006)). Even a single act by a
defendant may establish specific jurisdiction if the act in
the forum state is substantially related to the suit. See
Moncrief Oil Int'l v. OAO Gazprom, 481 F.3d 309, 311
(5th Cir. 2007).
plaintiff establishes that the defendant had minimum contacts
with the forum state sufficient to permit specific
jurisdiction, the burden shifts to the defendant to prove
that the exercise of jurisdiction is not fair or reasonable.
McFadin, 587 F.3d at 759. In this inquiry, the Court
examines five factors: (1) the burden on the nonresident
defendant; (2) the forum state's interests; (3) the
plaintiff's interest in securing relief; (4) the interest
of the interstate judicial system in the efficient
administration of justice; and (5) the shared interest of the
several states in furthering fundamental social policies.
Burger King Corp., 471 U.S. at 477. “It is
rare to say the assertion of jurisdiction is unfair after
minimum contacts have been shown.” McFadin,
587 F.3d at 760 (quoting Wien Air Alaska, Inc. v.
Brandt, 195 F.3d 208, 215 (5th Cir. 1999)).
Improper Venue - 12(b)(3)
Rule of Civil Procedure 12(b)(3) allows a party the ability
to move the Court to dismiss an action for “improper
venue.” Fed.R.Civ.P. 12(b)(3); see Braspetro Oil
Servs. Co. v. Modec (USA), Inc., 240 F. App'x 612,
615 (5th Cir. 2007). Once a defendant raises improper venue
by motion, “the burden of sustaining venue will be on
Plaintiff.” Cincinnati Ins. Co. v. RBP Chem. Tech.,
Inc., No. 1:07-CV-699, 2008 WL 686156, at *5 (E.D. Tex.
Mar. 6, 2008) (citations omitted). “Plaintiff may carry
this burden by establishing facts that, if taken to be true,
establish proper venue.” Id. (citations
omitted). The Court “must accept as true all
allegations in the complaint and resolve all conflicts in
favor of the plaintiff.” Mayfield v. Sallyport
Global Holdings, Inc., No. 6:16-CV-459, 2014 WL 978685,
at *1 (E.D. Tex. Mar. 5, 2014) (citing Ambraco, Inc. v.
Bossclip, B.V., 570 F.3d 233, 237-38 (5th Cir. 2009)).
In determining whether venue is proper, “the Court may
look beyond the complaint to evidence submitted by the
parties.” Ambraco, 570 F.3d at 238. If venue
is improper, the Court must dismiss it, “or if it be in
the interest of justice, transfer such case to any district
or division in which it could have been brought.” 28
U.S.C. § 1406(a); Fed.R.Civ.P. 12(b)(3).
1404 permits a district court to transfer any civil case
“[f]or the convenience of parties and witnesses, in the
interest of justice . . . to any other district or division
where it might have been brought.” 28 U.S.C. §
1404(a). “Section 1404(a) is intended to place
discretion in the district court to adjudicate motions for
transfer according to an ‘individualized, case-by-case
consideration of convenience and fairness.'”
Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29
(1988) (quoting Van Dusen v. Barrack, 376 U.S. 612,
622 (1964)). The purpose of 28 U.S.C. § 1404(a)
“is to prevent the waste ‘of time, energy and
money' and ‘to protect the litigants, witnesses and
the public against unnecessary inconvenience and expense . .
.'” Van Dusen, 376 U.S. at 616.
threshold inquiry when determining eligibility for transfer
is “whether the judicial district to which transfer is
sought would have been a district in which the claim could
have been filed, ” or whether all parties have
consented to a particular jurisdiction. In re Volkswagen
AG, 371 F.3d 201, 203 (5th Cir. 2004)
(“Volkswagen I”). Once that threshold
inquiry is met, the Fifth Circuit has held that “[t]he
determination of ‘convenience' turns on a number of
public and private interest factors, none of which can be
said to be of dispositive weight.” Action Indus.,
Inc. v. U.S. Fid. & Guar. Co., 358 F.3d 337, 340
(5th Cir. 2004). 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; (4) all other practical problems that make trial
of a case easy, expeditious and inexpensive. In re
Volkswagen of Am., Inc., 545 F.3d 304, 315 (5th Cir.
2008) (en banc) (“Volkswagen II”). 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 of
conflict of laws or in the application of foreign law.
Id. These factors are not exhaustive or exclusive,
and no single factor is dispositive. Id.
party seeking transfer of venue must show good cause for the
transfer. Volkswagen II, 545 F.3d at 315. The moving
party must show that the transferee venue is “clearly
more convenient” than the transferor venue.
Id. The plaintiff's choice of venue is not a
factor in this analysis, but rather contributes to the
defendant's burden to show good cause for the transfer.
Id. at 315 n.10 (“[W]hile a plaintiff has the
privilege of filing his claims in any judicial division
appropriate under the general venue statute, § 1404(a)
tempers the effects of the exercise of this
privilege.”). However, ...