United States District Court, W.D. Kentucky, Southern Division
ORDER AND OPINION DENYING DEFENDANT'S MOTION TO
DISMISS AND GRANTING DEFENDANT'S MOTION TO TRANFER VENUE
G. Edmunds, United States District Judge
before the Court is Defendant's motion to dismiss for
lack of personal jurisdiction or, in the alternative, to
transfer this case to the Western District of Kentucky. (ECF
No. 6.) Plaintiff opposes the motion. On February 6, 2019 the
Court held a hearing in connection with Defendant's
motion. For the reasons set forth below, the Court
DENIES Defendant's motion to dismiss and
GRANTS Defendant's motion to transfer
venue to the Western District of Kentucky.
matter arises out of Defendant's employment with
Plaintiff Air Systems, Inc. Plaintiff is a manufacturer's
representative, distributer, and systems integrator of
industrial air processes, equipment, technical services, and
control systems. Plaintiff is a Michigan Corporation based in
Royal Oak, Michigan. From 2011 through 2018, Defendant was
employed by Plaintiff as an outside sales representative.
According to the complaint, Defendant was employed out of
Plaintiff's office in Royal Oak, Michigan. Defendant
states that he worked exclusively in Louisville, Kentucky
throughout his entire employment with Plaintiff.
22, 2018, Defendant resigned from his employment with
Plaintiff. Defendant claims that he quit because Plaintiff
failed to pay him his agreed upon wages over a period of
several years. On July 17, 2018, Defendant filed a lawsuit
against Plaintiff seeking to recover those unpaid wages and
commissions. Defendant's wage lawsuit is currently
pending in the United States District Court for the Western
District of Kentucky, Louisville Division.
did not assert any counterclaims in the Kentucky lawsuit.
Instead, on November 2, 2018, Plaintiff initiated this action
against Defendant in state court in Oakland County, Michigan.
On November 11, 2018, Defendant removed the case to this
Court on diversity grounds.
complaint, Plaintiff asserts several claims against Defendant
arising out of his resignation and subsequent business
activities. These claims include allegations of tortious
interference with Plaintiff's business contracts,
existing customers, and future contracts, conversion of
Plaintiff's confidential and proprietary information by
allegedly refusing to return materials to Plaintiff, unfair
competition, and unjust enrichment. Plaintiff alleges that it
suffered lost profits and lost business opportunities as a
result of Defendant's alleged conduct and seeks to
recover damages from Defendant.
moves to dismiss Plaintiff's complaint for lack of
personal jurisdiction pursuant to Federal Rule of Civil
Procedure 12(b)(2). Defendant is a resident of Kentucky and
claims that he resided in Kentucky during the entire term of
his employment with Plaintiff. Defendant admits to having
limited contacts with the state Michigan during his
employment, but contends that none of this conduct relates to
Plaintiff's claims. Defendant states that in his eight
years of employment with Plaintiff he only travelled to
Michigan on four occasions. First, in 2012, Defendant
travelled to Plaintiff's office in Michigan for one day
to present a summary of the 2011 sales results of
Plaintiff's Kentucky office. Second, in 2013, Defendant
travelled to Plaintiff's Michigan office for one day to
present a summary of the 2012 sales for Plaintiff's
Kentucky office. Defendant did not travel to Michigan from
2014 through 2017. But, in 2018 he took his third and fourth
trips to Michigan: one to discuss the 2018 sales results of
the Kentucky office, and the other to discuss alleged issues
with the payment of his wages and commissions by Plaintiff.
claims that aside from these four trips, none of his work for
Plaintiff occurred in Michigan. Defendant alleges that he
worked exclusively in Plaintiff's Louisville, Kentucky
office throughout his employment and that all of the projects
he performed were located in states other than Michigan.
Defendant maintains that none of the customers or vendors for
whom Defendant provided services on behalf of Plaintiff were
based in Michigan. Thus Defendant asserts that
Plaintiff's claims for tortious interference, conversion,
unfair competition, and unjust enrichment do not arise out of
his limited contacts with the state of Michigan and therefore
the Court's assertion of personal jurisdiction would be
opposes Defendant's motion and contends that Defendant is
subject to limited personal jurisdiction under MCL 600.705.
Plaintiff submits the affidavit of its president who
identifies a number of contacts between Defendant and the
state of Michigan. According to Plaintiff, Defendant's
contacts with the state of Michigan include reporting to
Plaintiff's owners, inside sales personnel, engineering,
and accounting personnel in Michigan; attending training and
work related meetings in Michigan; and regularly accessing
Plaintiff's computer servers in Michigan. Plaintiff also
contends that Defendant regularly utilized and relied on
Plaintiff's Michigan office for conducting his duties as
Plaintiff's outside sales representative. For example,
all inside sales functions for Defendant's jobs or
projects were performed by Plaintiff's employees in
Michigan. All confidential or proprietary information
acquired by Defendant originated out of Plaintiff's
office in Michigan. Defendant provided payroll and expense
reimbursement information to and was issued payment out of
Plaintiff's office in Michigan. And all of
Defendant's employment related files were purportedly
kept in Michigan.
argues that although Defendant's tortious conduct at
issue in this lawsuit may not have physically occurred in
Michigan, the consequences of the conduct occurred in
Michigan. According to the complaint, at the time Defendant
resigned, Plaintiff was expecting several jobs that Defendant
had quoted and had reported to be imminent orders awaiting
final signatures on paperwork. These jobs did not materialize
as expected. In addition, Plaintiff contends that Defendant
retained but refused to turn over job files, drawings,
blueprints, customer bid documents, estimates, paperwork, and
other documents belonging to Plaintiff. Plaintiff alleges
that as a result of Defendant's actions and failure to
return the retained documents, Plaintiff either lost out on
or could not perform projects it was awarded or was in the
process of being awarded.
alternative to its motion to dismiss for lack of personal
jurisdiction, Defendant requests that the Court transfer this
case to the Western District of Kentucky where
Defendant's wage action is already pending. Plaintiff
opposes this alternative relief.
statutes allow district courts to transfer venue: 28 U.S.C.
§ 1404(a) and 28 U.S.C. § 1406(a). “Section
1404(a) permits a transfer to any district where the case
could have been brought for the convenience of parties and
witnesses and in the interest of justice, ” while
“Section 1406(a) enables a district court to transfer
venue in the interest of justice when venue is improper in
the original forum to any district or division in which it
could have been brought.” Global Crossing
Telecommunications, Inc. v. World Connection Group,
Inc., 287 F.Supp.2d 760, 763 (E.D. Mich. 2003) (internal
quotation marks omitted) (footnote omitted). A court may not
transfer venue under § 1404(a) if the court lacks
jurisdiction over a defendant, but it may transfer venue
under § 1406(a) even if it lacks personal jurisdiction.
Id. at 763-764. Thus, the Court must first consider
whether it has personal jurisdiction over Defendant.
presented with a motion to dismiss for lack of personal
jurisdiction under Federal Rule of Civil Procedure 12(b)(2),
a court may decide the motion on the basis of written
submissions and affidavits alone. See Serras v. First
Tenn. Bank Nat'l Ass'n, 875 F.2d 1212, 1214 (6th
Cir. 1989). When a court decides to pursue that path, the
plaintiff must meet a “relatively slight” burden
of a prima facie showing that personal jurisdiction exists to
survive the motion. Estate of Thompson ex rel. Estate of
Rakestraw v. Toyota Motor Corp. Worldwide, 545 F.3d 357,
360 (6th Cir. 2008). The plaintiff can do so by
“establishing with reasonable particularity sufficient
contacts between [the defendant] and the forum state to
support jurisdiction.” Lexon Ins. Co. v. Devinshire
Land Dev., LLC, 573 Fed.Appx. 427, 429 (6th Cir. 2014).
The court must view the pleadings and affidavits in the light
most favorable to the plaintiff, Estate of Thompson,
545 F.3d at 360, and may only dismiss if the specific facts
alleged by the plaintiff collectively fail to make a prima
facie case for jurisdiction, CompuServe, Inc. v.
Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996). “A
federal court's exercise of personal jurisdiction in a
diversity of citizenship case must be both (1) authorized by
the law of the state in which it sits, and (2) in accordance
with the Due Process Clause of the Fourteenth
Amendment.” Neogen Corp. v. Neo Gen Screening,
Inc., 282 F.3d 883, 888 (6th Cir. 2002).
long-arm statute has been construed “to bestow the
broadest possible grant of personal jurisdiction consistent
with due process.” Audi AG & Volkswagon of Am.,
Inc. v. D'Amatom, 341 F.Supp.2d 734, 741 (E.D. Mich.
2004). The statute extends both general and limited
jurisdiction over nonresident individuals and corporations.
See Mich. Comp. Laws § 600.701 (general,
individuals); Mich. Comp. Laws § 600.705 (limited,
individuals); Mich. Comp. Laws § 600.711 (general,
corporations); Mich. Comp. Laws § 600.715 (limited,
corporations). Limited personal ...