SUE E. MYERSCOUGH, District Judge.
This matter is before the Court on Defendant Atlantis Pools, Inc.'s Motion to Transfer Venue (d/e 2). For the convenience of the parties and witnesses and in the interest of justice, the Motion is GRANTED. This case is TRANSFERRED to the United States District Court for the Southern District of Illinois.
In December 2015, Cynthia and Davis Smalley ("the Smalleys") filed an Amended Complaint against Atlantis in Madison County Circuit Court, Case No. 2015-L-132 (d/e 1-1). In that lawsuit, the Smalleys allege that they hired Atlantis to repaint the in-ground pool on the Smalleys' property in Godfrey, Illinois. Atlantis allegedly failed to perform the work correctly and caused damage to the pool, the deck, the piping, and an outbuilding. The Smalleys seek damages in excess of $50,000 for damages including the cost of replacing the pool, repairing damage to the deck surrounding the pool, repairing ruptured pipes, and damages caused by draining and refilling the pool.
In December 2015, Plaintiff Hastings Mutual Insurance Company filed its Complaint for Declaratory Judgment (d/e 1) in this Court against Atlantis and the Smalleys. The Smalleys are named as necessary parties only. Compl. ¶ 11.
Hastings alleges that it issued a Commercial Package Policy to Atlantis for the period of May 1, 2014 to May 1, 2015.
Hastings seeks a declaratory judgment that it has no duty to defend or indemnify Atlantis in the underlying lawsuit brought by the Smalleys. Count I alleges that Atlantis failed to satisfy conditions precedent to coverage. Count II alleges that Hastings has no duty to defend Atlantis because the underlying lawsuit falls within the exclusions of the Policy. Count III alleges that, under the Policy, Hastings has no duty to indemnify Atlantis. The Court notes that Alton and Godfrey are located in Madison County, which is within the Southern District of Illinois.
This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. § 1332(a) (requiring complete diversity and an amount in controversy in excess of $75,000 exclusive of interest and costs). Based on the allegations in the complaint and Hastings' Supplemental Response (d/e 15), complete diversity exists between Plaintiff Hastings and the defendants, Atlantis and the Smalleys.
Specifically, Hastings is a Michigan corporation with its principal place of business in Hastings, Michigan. Compl. ¶ 6. Atlantis is an Illinois corporation with offices located in Springfield, Illinois. Compl. ¶ 8;
The parties do not dispute that the amount-in-controversy requirement is met, and the Court agrees. In a declaratory judgment action, "the amount in controversy is measured by the value of the object of the litigation."
The Court finds that the amount in controversy exceeds $75,000. In the underlying lawsuit, the Smalleys seek in excess of $50,000
Because the parties are diverse and the amount in controversy exceeds $75,000, this Court has jurisdiction.
Venue is proper in this district because a civil action may be brought in a judicial district in which any defendant resides, if all of the defendants are residents of the State in which the district is located. 28 U.S.C. § 1391(b)(1). Here, all of the defendants are residents of Illinois. The Smalleys reside in Illinois. Compl. ¶ 10. Atlantis, as a corporate defendant, is deemed to reside "in any district in [Illinois] within which its contacts would be sufficient to subject it to personal jurisdiction if that district were a separate State. . . ." 28 U.S.C. § 1391(d) (addressing residency of corporations in States with multiple districts). Atlantis maintains an office in Springfield, Illinois, which is within the Central District of Illinois. Therefore, venue is proper in this District.
Atlantis requests that this Court transfer the case to the District Court for the Southern District of Illinois pursuant to 28 U.S.C. § 1404(a). Section 1404(a) of Title 28 of the United States Code provides the circumstances under which a court may transfer a civil action to another district or division:
28 U.S.C. § 1404(a). The moving party must show that (1) venue is proper in the current district and would be proper in the transferee district; (2) "the transferee district is more convenient for both the parties and witnesses," and (3) "transfer would serve the interests of justice."
The parties agree that venue is proper in both this district and the Southern District of Illinois. Venue is proper in the Southern District because a substantial part of the events or omissions giving rise to the claim occurred in the Southern District and because the defendants reside in the Southern District.
When considering the convenience factor, the Court considers the following: (1) the plaintiff's choice of forum; (2) the situs of events giving rise to the suit; (3) the ease of access to evidence; (4) the convenience of the parties; and (5) the convenience of the witnesses.
In this case, the Central District of Illinois is not Hastings' home forum. Hastings is a Michigan corporation with its principal place of business in Hastings, Michigan. Moreover, as discussed further below, the Central District lacks significant contact with the litigation. Therefore, the Court will give Hastings' choice of forum little weight.
The situs of the events giving rise to the lawsuit is the Southern District of Illinois. The events leading to the underlying lawsuit occurred in the Southern District; the underlying lawsuit is pending in the state court within the Southern District; and the insurance policy was issued to an insured located in the Southern District by a broker in the Southern District. In fact, the only connection the Central District of Illinois has to the case is the fact that Atlantis maintains an office in Springfield. Atlantis' principal place of business is in Alton, which is within the Southern District of Illinois.
The ease of access to the evidence is a neutral factor. While some of the documents are maintained in the Southern District of Illinois and some are likely in Michigan, neither party suggests the files and records are so voluminous that they cannot be easily transferred from one district to the another. Therefore, based on this factor, the Southern District and the Central District are equally convenient.
The convenience-of-the-parties factor slightly favors transfer. Atlantis' corporate offices are in the Southern District of Illinois. The nominal defendants, the Smalleys, also reside in the Southern District.
Atlantis argues that Hastings is located in Hastings, Michigan, so Hastings will be inconvenienced in either forum.
The convenience-of-the-witnesses factor is neutral or weighs in favor of transfer. Atlantis argues that almost all of its witnesses— current and former employees—live in the Southern District of Illinois. These witnesses would purportedly testify about Atlantis' actions on the Smalleys' property, communications regarding the Smalleys' claims, and communications with retained defense counsel. Mot. at 12 (d/e 2-1). Atlantis further asserts that, while Hastings may have witnesses located in Michigan, those witnesses will have to travel to Illinois from Michigan regardless of the specific district that tries the case.
Hastings argues that this factor does not weigh in favor of transfer because declaratory actions involving a duty to defend generally involve only questions of law and are frequently resolved by summary judgment and not trial. As such, Hastings argues, it is not proper to consider whether one district is more convenient to any witnesses. Hastings asserts that Atlantis cannot meet its burden of showing that it would be more convenient for a court in the Southern District to compare the terms and conditions of the policy to the allegations of the complaint instead of this Court in the Central District. Hastings Resp. at 2-3 (d/e 7).
To the extent that this case will be resolved without a trial, the convenience-of-the-witnesses factor is neutral. However, in Count I of the Complaint, Hastings alleges that Atlantis violated conditions precedent to coverage by failing to fully cooperate with Hastings and provide requested information. Such a claim may require testimony of witnesses regarding Atlantis' compliance with the conditions precedent to coverage. Such witnesses would be located in the Southern District of Illinois and Michigan. Neither party has identified any potential witnesses located in the Central District of Illinois. Therefore, if the case proceeds to trial, the-convenience-of-the-witnesses factor would weigh in favor of transfer.
The Court must also consider whether transfer would serve the interest of justice. This requires the Court to consider (1) the "docket congestion and likely speed to trial" in each forum; (2) "each court's relative familiarity with the relevant law;" (3) "the respective desirability of resolving controversies in each locale;" and (4) "the relationship of each community to the controversy."
According to the U.S. District Courts Federal Management Statistics
In the Southern District, the average civil-case filings per judgeship was 1,149 (4,595 pending cases and four judgeships) with a median time for disposition of 35.5 months. The median time from filing to trial in civil cases was 30.1 months.
The Court notes, however, that the Southern District had multidistrict litigation cases pending in 2015.
The parties appear to assume that Illinois law applies to the Policy.
Considering all of the factors, the Court finds transfer is warranted. The Central District has absolutely no connection with this case. The underlying lawsuit was filed in the state court in the Southern District; the policy was issued by Hastings to an insured whose address listed on the declarations page is in the Southern District of Illinois and sold through a broker located within the Southern District; and Atlantis' corporate offices are in the Southern District. Further, if trial witnesses are necessary, many of those witnesses—current and former employees of Atlantis—reside in the Southern District and no witnesses reside in the Central District. Therefore, considering all of the relevant factors, the Court concludes that transfer is warranted.
For the reasons stated, Defendant Atlantis Pools, Inc.'s Motion to Transfer Venue (d/e 2) is GRANTED. This case is TRANSFERRED to the United States District Court for the Southern District of Illinois, East St. Louis division.