Opinion
CIVIL ACTION NO. 03-1834 SECTION "C"
October 29, 2003
ORDER AND REASONS
Kristen Fair, a third year law student at Tulane Law School, assisted with the research and preparation of this decision.
This matter comes before the Court on motion to dismiss by defendant. Having considered the record, the memoranda of counsel and plaintiff, and the law, Valero's motion is DENIED, but pursuant to 28 U.S.C. § 1404(a), the Court TRANSFERS this action to the Southern District of Texas.
Background
This action is a personal injury claim for injuries sustained in the course and scope of the plaintiffs employment at one of the defendant's convenience stores. The plaintiff alleges that the defendant stored gasoline behind the counter of the store underneath an air-conditioning vent, which blew fumes in his face and aggravated his pre-existing medical conditions. (Rec. Doc. 1 at 2-3). The plaintiff seeks damages from the defendant for medical treatment in the amount of $475,000. Id. He bases jurisdiction on diversity, claiming he is a resident of Louisiana and the defendant is a Texas resident, Id. at 1. The defendant filed a motion to dismiss raising the following issues now present before the court (1) whether the plaintiff is a resident of Louisiana so that diversity jurisdiction is warranted; (2) whether District Courts may exercise jurisdiction over a workers' compensation claim based on diversity jurisdiction; (3); whether venue is proper in the Eastern District of Louisiana; and (4) whether the Southern District of Texas is a more convenient forum where this action should be transferred pursuant to 28 U.S.C. § 1404(a).
Defendant also raises the issue of non-exhaustion saying that because the plaintiff has not exhausted his administrative remedies, he should not be able to proceed with the lawsuit. Since the Court finds that this action should be transferred to the Southern District of Texas, a court more equipped to understand the administrative requirements of Texas workers" compensation policies, that issue is not addressed in this order.
Standard of Review
The standard of review for a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction is the same as that for Rule(b)(6). US v. City of New Orleans, 2003 WL 22208578 at * 1 (E.D.La. 2003). The court may dismiss a claim if it appears certain that the plaintiff cannot prove any set of facts in support of his claim which would entitle him to relief. Benton v. US, 960 F.2d 19, 21 (5th Cir. 1992). See also Lawson v. Parish of St. Tammany, 2001 WL 562183 (E.D.La. 2001). The court has wide discretion in handling motions to dismiss, but they are usually granted sparingly and with caution to ensure the plaintiffs right to have a claim adjudicated on the merits is not violated. 5A Charles Alan Wright Arthur R. Miller, Federal Practice and Procedure § 1349 (2d ed. 1990). The court will not draw favorable inferences on behalf of the pleader; however, the party seeking diversity jurisdiction has the burden of showing real and complete diversity. Id. The plaintiff must prove diversity of citizenship by a preponderance of the evidence. Welsh v. American Sur. Co. of N.Y., 186 F.2d 16, 17 (5th Cir. 1951).
For the majority of courts the standard of review for Motions to Dismiss Pursuant to Rule 12(b)(3) is that once a defendant has raised the improper venue issue by motion, the burden of sustaining venue rests with the plaintiff. McCaskey v. Continental Airlines Inc., 133 F. Supp.2d 514, 523 (S.D.Tex. 2001); Bigham v. Envirocare of Utah, Inc., 123 F. Supp.2d 1046, 1048 (S.D.Tex. 2000). If there is no evidentiary hearing, courts will allow a plaintiff to carry the burden by establishing facts, taken as true, that establish venue. McCaskey, 133 F. Supp.2d at 523; Bigham, 123 F. Supp.2d at 1048; Wilson v. Belin, 20 F.3d 644, 648 (5th Cir. 1994). The Court accepts undisputed facts in the Plaintiffs pleadings as true, and resolves any conflicts in the Plaintiffs favor. McCaskey, 133 F. Supp.2d at 523. Courts have provided the plaintiff with the benefit of the doubt when determining the governing facts. Id.
Law Analysis
i. Diversity Jurisdiction
As this court is deciding to transfer, the determination of diversity will be left to the federal court in Texas. As a pro se plaintiff, Dupree would be prejudiced by a dismissal, and as it is certain that the Eastern District of Louisiana is not the best forum, the court orders a transfer and leaves it to a judge in Texas to determine diversity. This court lacks much of the information needed to make this determination, such as a driver's license, voter's registration, and tax forms. Courts have held a pro se plaintiff to a less stringent standard. See Haines v. Kerner, 92 S.Ct. 594, 596 (1972); Moore v. McDonald, 30 F.3d 616, 620 (5th Cir. 1994). Rather than dismissing the case, it is transferred and the plaintiff can provide further evidence that he was a Louisiana resident when he filed this action.
ii. Jurisdiction of a Federal Court over a State Workers' Compensation Claim
Defendant next argues that a federal court does not have jurisdiction over a workers' compensation claim pursuant to 28 U.S.C. § 1445(c). (Rec. Doc. 5 at 5). Section 1.445 of Title 28, entitled "Nonremovable actions," prohibits the removal of a claim arising under the workers' compensation laws of a state when the action is filed in state court. Even though an action against a non-subscriber of the Texas Workers' Compensation plan may be brought under a negligence standard, courts have still held that these claims "arise under" the Workers' Compensation statute. See Trevino v. Ramos, 197 F.3d 777 (5th Cir. 1999); Jones v. Roadway Express, Inc., 931 F.2d 1086 (5th Cir. 1991); Figueroa v. Healthmark Partners, LLC, 125 F. Supp.2d 209 (S.D. Tex. 2000). Defendant, a non-subscriber, claims that Congress intended to limit the jurisdiction of federal courts by precluding federal courts from exercising jurisdiction over state workers' compensation claims. (Rec. Doc. 5 at 6). Plaintiff responds saying that his claim should be treated as an ordinary personal injury case, like an automobile accident. (Rec.Doc. 6 at 4).
Defendant's interpretation of § 1445(c) is erroneous. The statute clearly states that federal courts are not to exercise jurisdiction over a workers' compensation case when the defendant tries to remove the case after it was filed in state court. All of defendant's cases have to do with removal and address exactly what the statute was intended to deal with — a plaintiff filing a workers' compensation claim in state court with the defendant trying to remove it based on diversity jurisdiction. Federal courts still maintain original jurisdiction over workers' compensation claims. While removal cases may no longer be in the federal courts' jurisdiction, Congress showed no intent to withdraw workers' compensation cases which were filed in federal court as original actions. Liberty Mut. Ins. Co. v. Norton, 275 F.2d 148, 153 (5th Cir. 1960) affirmed 367 U.S. 348 (1961). If Congress intended to withdraw all workers' compensation claims from federal jurisdiction, it would have stated as such. It is improper to extend this exclusion absent congressional action. Id. See also Williams v. AC Spark Plugs, 985 F.2d 783, 788 (5th Cir. 1993). If the plaintiff filed a workers' compensation claim in federal court, it cannot be dismissed based on § 1445(c). St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 587-88 (5th Cir. 1994). If there is true diversity, then a federal court may exercise jurisdiction over a workers' compensation claim filed in federal district court.
iii. Proper Venue
The venue statute sets forth three circumstances in which venue is proper in diversity cases; a civil action may be filed in (1) a district where the defendant resides; (2) a district where a substantial part of the events giving rise to the claim occurred; (3) a district in which the defendant is subject to personal jurisdiction if there is no other district in which the action may be brought. 28 U.S.C § 1391(a). The plaintiff and the defendant argue over whether the second or third circumstances are applicable; however, the first circumstance settles the issue of venue. A jurisdiction where a corporation is licensed to do business is their residence for venue purposes. 15 Charles Alan Wright, Arthur R. Miller Edward H. Cooper, Federal Practice and Procedure § 3811 (2d ed. 1986). In International Software Systems, Inc. v. Amplicon, Inc., the Fifth Circuit said "under 28 U.S.C. § 1391 (a) and (c), venue in a diversity suit lies against a corporate defendant in any district where the corporation `resides,' and a corporation is deemed to reside in any district in which it is subject to personal jurisdiction." 77 F.3d 112, 114 n. 2 (5th Cir. 1996). Defendant does business in Louisiana and is subject, to personal jurisdiction in the Eastern District of Louisiana; therefore, venue is proper in this district.
However, when a case is transferred, improper venue objections become moot. 5A Charles Alan Wright Arthur R. Miller, Federal Practice and Procedure § 1349 (2d ed. 1990).
iv. Change of Venue under § 1404(a)
As its final argument for dismissal the defendant raises a forum non conveniens argument. In 1948, Congress passed 28 U.S.C. § 1404(a), which allows a district court to transfer an action to another district in the interest of justice and for the convenience of the parties and witnesses. 15 Charles Alan Wright, Arthur R. Miller Edward H. Cooper, Federal Practice and Procedure § 3828 (2d ed. 1986). The effect of this statute is that forum non conveniens has limited continuing validity. Id. It is only used today when the convenient forum is in a foreign country, or in even rarer circumstances, a state court. Id. As the defendant offers the Southern District of Texas, which is neither a state or foreign court, as the alternative forum, the court assumes that the defendant is referring to § 1404(a) and not forum non conveniens.
The convenience analysis under § 1404(a) is similar to forum non conveniens, although transfers are more readily granted under § 1404(a) than dismissals are under forum non conveniens. Id. at § 3848. When determining whether transfer is appropriate, the district court considers the convenience factors set forth in Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947). Private interests in a transfer decision include: (1) the plaintiffs choice of forum; (2) the situs of material events; (3) the convenience of witnesses; (4) the convenience of the parties; and (5) all other factors relating to the expeditiousness and efficient adjudication of the dispute. Laithram Corp. v. Hewlett-Packard Co., 120 F. Supp.2d 607, 608 (E.D. La. 2000) (citing Gulf Oil, 330 U.S. at 508-09). Four public interests to consider include: (1) the relative administrative difficulties in the two jurisdictions; (2) the local interest in having localized controversies resolved at home; (3) the appropriateness of having the jurisdiction of the governing law decide the controversy to avoid conflict of law problems; and (4) the unfairness of burdening citizens in an unrelated forum with jury duty. Id.
The private interests in this case are equally balanced. While plaintiffs choice of forum, the Eastern District of Louisiana, is a factor, it is no longer the dominant factor. 15 Charles Alan Wright, Arthur R. Miller Edward H. Cooper, Federal Practice and Procedure § 3848 (2d ed. 1986). However, a defendant has the burden of showing why there ought to be a change in forum. Id. It is not enough for the defendant just to prefer another forum or to show that the claim arose elsewhere. Id. The balance of convenience must be strongly in favor of the moving party for a transfer to be granted; transfers are not granted when it will merely shift the inconvenience from the defendant to the plaintiff. See id. While the initial injury occurred in Texas, the plaintiff was treated in New Orleans. (Rec. Doc. 1 at 8; Rec. Doc 6 at 4). Witnesses will probably be from both states, so the convenience of witnesses is an inconclusive factor. As is the situs of material events, since treatment and injury occurred in separate locations. On private interests alone, there is insufficient reason to transfer.
However, the public factors support a transfer. This is a Texas workers compensation claim and the most natural place for such a case to be litigated is Texas. The local interest in having localized controversies resolved at home weighs in favor of transfer to Texas. The appropriateness of having the case tried in a district court in the state whose law is at issue is also a factor in supporting transfer. The implied Leroy test compares the weight of contacts between the claim and a particular district. 15 Charles Alan Wright, Arthur R. Miller Edward H. Cooper, Federal Practice and Procedure § 3806 (2d ed. 1986); see also Leroy v. Great Western United Corp., 99 S.Ct. 2710 (1979). Leroy contacts included the availability of witnesses, accessibility of relevant evidence, the convenience of the defendant, and if state law is involved, which state that is. Id. In Leroy, a Texas-based corporation sued Idaho officials in Texas for enforcing an what they claimed was an unconstitutional Idaho statute. Leroy, 99 S.Ct at 2712. The Supreme Court found venue was improper in Texas for several reasons, one being that "the merits of Great Western's claims may well depend on a proper interpretation of the State's statute, and federal judges sitting in Idaho are better qualified to construe Idaho law, and to assess the character of Idaho's probable enforcement of that law, than are judges sitting elsewhere." Id. at 2718. The Ninth Circuit applied the Leroy rule in District No., Pacific Coast Dist. M.E.B.A. v. State of Alaska, 682 F.2d 797, 798-99 (9th Cir. 1982). The court held that venue lies in Alaska when challenging the constitutionality of an Alaska statute. Id. at 799.
But see, Engel v. W.R. Berkley Corp., 2001 WL 238113 (N.D. Tex. 2001) (defendant's argument that North Carolina law applied was insufficient to transfer venue from Texas to North Carolina as courts are often called to interpret laws of other states in diversity actions).
While the plaintiff claims that his action is an ordinary tort case, the Fifth Circuit and District Courts in Texas have held that because the Workers' Compensation Act provides for employees to sue non-subscriber employers under a negligence standard and it takes away common law defenses of the employer, an action against a non-subscriber still "arises under" the Texas Workers' Compensation Act See Trevino v. Ramos, 197 F.3d 777 (5th Cir. 1999); Jonesv. Roadway Express, Inc., 931 F.2d 1086 (5th Cir. 1991); Figueroa v. Healthmark Partners, L.L.C., 125 F. Supp.2d 209 (S.D. Tex. 2000). Since the applicable law in this action is Texas workers' compensation law and Texas judges are better equipped to interpret Texas law than judges in other parts of the country, this action would be better litigated in Texas than Louisiana.
Another public interest supporting transfer is the unfairness of burdening the citizens in an unrelated forum with jury duty. In Texas, a workers1 compensation claim may be brought before a jury. See e.g. Tex. Labor Code § 410.304(a); Lone Star Steel Co. v. Hatten, 104 S.W.3d 323 (Tex.App.-Texarkana, 2003); Excel Corp. v. Apodaca, 81 S.W.3d 817,45 Tex. Sup.Ct. J. 962 (Tex. 2002). Community interests in the resolution of the case point to Texas. Texans are more likely to be interested in the outcome of this case than Louisianans. New Orleans jurors would have little interest in a dispute arising under Texas law between a Texas employer and employee who used to live in work in Texas. This dispute would be much better resolved in Houston than in New Orleans.
The defendant's arguments on the convenience of this forum are correct. However, the defendant's request for dismissal based on inconvenience should not be granted, rather this case should be transferred to the Southern District of Texas pursuant to 28 U.S.C § 1404(a). The Court has a choice between dismissal and transfer. 15 Charles Alan Wright, Arthur R. Miller Edward H. Cooper, Federal Practice and Procedure § 3827 (2d ed. 1986). If it is in the interest of justice, then the claim should be transferred rather than dismissed. Id. The broad language of § 1404(a) suggests that a court may transfer on its own motion. 5A Charles Alan Wright Arthur R. Miller, Federal Practice and Procedure § 1349 (2d ed. 1990). See also Lead Indus. Ass'n v. OSHA, 610 F.2d 70, 79 n. 17 (2d Cir. 1979) (citing Wright Miller); I-T-E CircuitBreaker Co. v. Becker, 343 F.2d 361, 363 (8th Cir. 1965). The Eighth Circuit in Becker noted that subsection (a) of § 1404 does not have any limiting language as to the power of the district court to transfer a civil action to another district like the language in subsection (b) (`upon motion, consent or stipulation of all parties'). Becker, 343 F.2d at 363. The court goes on to say "[s]ub section (a) is general in its provisions: 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."1 Id. The broadest power encapsulated in the phrase `in the interest of justice'. See id. It is this reason that this court feels that the Southern District of Texas is the more appropriate forum and thus orders a transfer pursuant to power inherent in § 1404(a). As a pro se plaintiff, dismissal would probably cause great hardship. To avoid a violation of the plaintiffs right to have his case adjudicated on the merits, this action should be transferred rather than dismissed.
Conclusion
The Court finds that although the Eastern District of Louisiana is a proper venue and a federal court may exercise jurisdiction over workers' compensation claims, the Southern District of Texas is a more convenient forum and this action should be litigated there. Even if the plaintiff is a citizen of Louisiana, he could have filed his action in the Southern District of Texas based on diversity jurisdiction. Venue is proper in the Southern District of Texas as the defendant is a resident of Texas and a substantial part of the events giving rise to the cause of action arose in that district.
Accordingly, in the interests of judicial economy, the court will transfer the case before it to the United States District Court for the Southern District of Texas, Houston Division. IT IS ORDERED that the motion to dismiss by the defendant Valero Energy Corporation is DENIED.
IT IS FURTHER ORDERED that this case be TRANSFERRED to the Southern District of Texas, Houston Division.