After the Second Circuit vacated Judge Kaplan’s preliminary injunction (which, recall, had enjoined the Lago Agrio plaintiffs from seeking to enforce the Ecuadoran judgment against Chevron anywhere in the world), Patton Boggs, the law firm representing the plaintiffs, sued Chevron in New Jersey for damages arising out of the now-vacated injunction. Its main theories were malicious prosecution, unjust enrichment, and a claim for attorney’s fees under New York law. 1 Chevron sought a transfer from the District of New Jersey to the Southern District of New York under 28 U.S.C. § 1404(a),2 which provides:
For 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 [ellipsis]
Magistrate Judge Waldor has now recommended granting Chevron’s motion. The threshold issue was easy: Patton Boggs could have sued Chevron in New York in the first instance had it wished: the New York court would have had subject matter jurisdiction and personal jurisdiction, and venue would have been properly laid there. But under § 1404, the judge was required to weigh the private and public interests at stake, bearing in mind the usual rule that the plaintiff’s choice of forum should not be lightly disturbed.
The private factors favored transfer, according to the judge. The key private factor is the plaintiff’s choice of forum. But the judge gave that factor less weight than it would get in a more typical case. First most of facts on which the case arises occurred in New York. The fact that Patton Boggs suffered an injury in New Jersey was insufficient to overcome the judge’s conclusion that New York was the “center of gravity” of the case. Second, Patton Boggs is a major international law firm with its headquarters in Washington, and so its argument that New Jersey was its “home state” was less compelling than a smaller organization’s claim might have been. Chevron’s preference for New York was, conversely, entitled to some weight because the facts of the case happened there. The convenience of the parties and the availability of witnesses or documents did not strongly favor one forum or the other.
The public factors also favored transfer. The judge focused on judicial efficiency. It would clearly be more efficient to have Judge Kaplan decide all related matters. The judge concluded that there was no reason to think that either forum would face particular administrative difficulties, though she did note that New York law governed some of the claims. Last, the judge discounted the notion that New Jersey courts had an interest in protecting New Jersey citizens from loss, noting that Patton Boggs was not truly a local business.
Patton Boggs now has fourteen days to assert objections to the magistrate judge’s recommendation, which the court will consider de novo.
Photo credit: Jack E. Boucher
- Patton Boggs initially asserted a claim on the bond Chevron had submitted to the court as a condition of obtaining the injunction, but Judge Kaplan later exonerated the bond, thus apparently mooting this portion of Patton Boggs’s claim.
- Chevron also sought a transfer under the “first-filed rule,” but the magistrate judge decided the case solely under § 1404.