DAVID S. DOTY, District Judge.
This matter is before the court upon the motion to dismiss or transfer venue by defendant Schneider Wallace Cottrell Konecky Wotkyns LLP. Based on a review of the file, record, and proceedings herein, and for the following reasons, the motion is denied.
This contract dispute arises out of defendant Schneider Wallace's alleged failure to pay plaintiff Rust Consulting, Inc. for rendered services. In 2011, Schneider Wallace, a law firm based in California, and Rust, a Minnesota consulting services company, entered into a Master Services Agreement in which Rust agreed to perform services for Schneider Wallace relating to certain mass tort actions. Compl. ¶¶ 1-3; Blake Aff. Ex. A.
Rust claims that, from April 2012 through December 2013, it sent invoices to Schneider Wallace for its services totaling $323,756.22 and that Schneider Wallace has failed to pay. Compl. ¶¶ 8-9. Rust also alleges that it is entitled to a per-claim fee of $2,500 for each resolved claim in the relevant mass tort actions.
On October 9, 2017, Rust filed suit in Hennepin County court alleging breach of contract, account stated, quantum meruit, and accounting. Schneider Wallace timely removed and now moves to dismiss for lack of personal jurisdiction, for failure to state a claim, and for improper venue and, in the alternative, to transfer venue to the Northern District of California.
To survive a motion to dismiss for lack of personal jurisdiction, a plaintiff must establish a prima facie case that the forum state has personal jurisdiction over the defendant.
To satisfy due process, a defendant must have "sufficient minimum contacts" with the forum state such that maintaining the suit "does not offend traditional notions of fair play and substantial justice."
A defendant's contacts with the forum state can establish personal jurisdiction under either general or specific jurisdiction. General jurisdiction is present when, regardless of the cause of action, a defendant's "affiliations with the [forum] State are so continuous and systematic as to render [it] essentially at home in the forum State."
Under either analysis, the Eighth Circuit considers five factors in determining whether personal jurisdiction exists: "(1) the nature and quality of defendant's contacts with the forum state; (2) quantity of contacts; (3) source and connection of the cause of action with those contacts; and to a lesser degree, (4) the interest of the forum state; and (5) the convenience of the parties."
In breach of contract cases, courts determine whether a defendant purposefully availed itself of the forum state by considering the prior negotiations, contemplated future consequences, and terms of the contract, and the parties' actual course of dealings.
In weighing the quality and quantity of a defendant's contacts with the forum state, courts have considered whether the defendant solicited a business relationship with a company incorporated in the forum state, the frequency of correspondence sent by the defendant to the forum state, whether the contract contains a choice-of-law provision that specifies the forum state's law, and whether the contract required the defendant to remit payment to an address in the forum state.
The court agrees with Schneider Wallace that it is not subject to the court's general jurisdiction because its contacts with Minnesota are not so substantial that it would be at home in the state.
In arguing that the court does not have specific personal jurisdiction, Schneider Wallace relies heavily on the fact that the contract was negotiated in California.
The contract contemplated that Rust would provide a variety of client intake and data management services related to Schneider Wallace's mass tort litigation. Although the data created by Rust was accessed via a client portal in California, Graham Decl. ¶ 6, the performance of the contract — such as client intake and data management — was physically performed in Minnesota. Blake Aff. Ex. ¶ 17. Indeed, Peter Schneider, on behalf of Schneider Wallace, along with representatives of other law firms, traveled to Minnesota from January 24 to January 26, 2011, to assist with implementing the mass tort project and training Rust employees.
These contacts are substantive and purposeful such that Schneider Wallace should have "reasonably anticipate[d] out-of-state litigation"; they are not "random, fortuitous, or attenuated."
Schneider Wallace also argues that Minnesota is an improper venue under 28 U.S.C. § 1391. But it is well established that § 1391 does not apply to removed actions — it only applies to actions originally filed in federal court. Rather, the venue of removed actions is governed by 28 U.S.C. § 1441(a).
Schneider Wallace also moves to dismiss the complaint for failure to state a claim.
To survive a motion to dismiss for failure to state a claim, "`a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'"
Schneider Wallace first argues that the allegations in the complaint are not sufficiently detailed to give rise to a plausible claim. The court disagrees. The complaint alleges that Rust and Schneider Wallace entered into a contract in March 2011, under which Schneider Wallace agreed to pay Rust for consulting services, call center services, data management services, claims intake, client portal design and maintenance, forms processing, and reporting services for Schneider Wallace's mass tort litigation. Compl. ¶¶ 3-4. It further alleges that Rust performed these services for Schneider Wallace from April 2011 to November 2013 and sent Schneider Wallace invoices totaling $323,756.22.
Schneider Wallace next contends that Rust has failed to plead an essential element of its breach of contract claim, namely, that Rust satisfied any conditions precedent.
Schneider Wallace argues that the court should dismiss or transfer the case to the North District of California under 28 U.S.C. § 1406. Section 1406 requires the court to dismiss or transfer a case if it was filed in the wrong venue. As discussed above, venue in this district is proper. Therefore, the court will not dismiss or transfer the case under § 1406.
Alternatively, Schneider Wallace contends that the case should be transferred to the Northern District of California under 28 U.S.C. § 1404.
Under § 1404(a), a court may at its discretion transfer a case to any other district where the case could have been brought. In determining whether transfer is appropriate, a court considers "(1) the convenience of the parties, (2) the convenience of the witnesses, and (3) the interests of justice."
Schneider Wallace argues that the Northern District of California is a more convenient forum because the actual performance or non-performance of the contract occurred there. The court is not persuaded. Other than accessing the client portal form California, it appears that the performance of the contract largely occurred in Minnesota. Employees, located in Minnesota, contacted potential plaintiffs, obtained HIPPA release forms, designed and maintained a web-based portal, and provided call center services. Moreover, the work was supervised and coordinated by Rust in Minnesota.
Schneider Wallace next argues, without specificity, that "the majority of key witnesses are . . . located in California." Def.'s Supp. Mem. at 23. But Schneider Wallace cannot simply rely on vague assertions to meets its burden, rather it must "clearly specify the essential witnesses to be called and must make a general statement of what their testimony will cover."
Because the underlying facts of this dispute, namely, whether Rust fully performed under the contract and is entitled to payment, largely occurred in Minnesota, the court finds that the resolution of this case will depend on evidence and witnesses located in Minnesota. As a result, the convenience of the parties and witnesses weighs against transfer.
The interests of justice typically involve considerations of "(1) judicial economy, (2) the plaintiff's choice of forum, (3) the comparative costs to the parties of litigating in each forum, (4) each party's ability to enforce a judgment, (5) obstacles to a fair trial, (6) conflict of law[s] issues, and (7) the advantages of having a local court determine questions of local law."
In support, Schneider Wallace only argues that "the interests of justice generally support transfer." Def.'s Supp. Mem. at 23. Again, the court finds that such conclusory statements are insufficient. The court agrees with Rust that the plaintiff's choice of forum and the advantage of having a court in Minnesota determine questions of Minnesota law weigh against transfer.
Accordingly,