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Shay v. Sight & Sound Systems

November 9, 2009

MARGOT SHAY, ET AL., PLAINTIFFS,
v.
SIGHT & SOUND SYSTEMS, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Richard W. Roberts United States District Judge

MEMORANDUM OPINION AND ORDER

The plaintiffs, five former employees of defendants Sight & Sound Systems, Inc. ("SASSI"), Koorosh Kaymanesh and Hamid Akrami, bring claims of federal Fair Labor Standards Act ("FLSA") violations, unlawful retaliation, breach of contract, and quantum meruit largely for the defendants' failure to compensate them for overtime hours worked. The defendants have moved to dismiss for lack of personal jurisdiction and improper venue, or in the alternative, to transfer venue. Because the District of Columbia is not an appropriate venue for the plaintiffs' claims, but the Eastern District of Virginia is an appropriate venue and a transfer is in the interest of justice, the case will be transferred.

BACKGROUND

Plaintiffs Margot Shay, Edsel Talbert, Richard Findley, Ron Perez and Melissa Coleman are former employees of SASSI, Kaymanesh and Akrami. (Compl. ¶¶ 2-4.) Kaymanesh and Akrami are co-owners of SASSI, which installs electronics and sight and sound systems for residential, corporate, and commercial clients in the District of Columbia, Maryland, and Virginia. (Id.) Kaymanesh, Akrami, and all of the plaintiffs are residents of Virginia. (Id. ¶ 1; see also Defs.' Stmt. of P. and A. in Supp. of Mot. to Dismiss ("Defs.' Stmt.") at 2.) SASSI is a Virginia corporation with its principal place of business in Dulles, Virginia. (Compl. ¶ 2.) It makes all substantive decisions related to wage payments and terminations, and computes and processes wage payments, in its sole Virginia office. (Defs.' Stmt. at 13.)

The plaintiffs allege that throughout the course of their employment with the defendants, they worked in excess of forty hours per week, and, in violation of the FLSA, the defendants failed to pay them at a rate of one-and-one-half times their regular rate for these overtime hours worked. (Compl. ¶¶ 8, 15, 22, 25, 28.) Shay alleges that on April 16, 2009, she met with the defendants to discuss their refusal to compensate her for the overtime hours worked, and she later filed a complaint with the United States Department of Labor ("DOL"). (Id. ¶ 10-11.) Shay contends that SASSI terminated her the following month in retaliation for her complaints. (Id. ¶ 12.) Talbert alleges that the defendants refuse to pay him a promised five percent of a successful bid he procured on their behalf to install a fire alarm system at the Manassas Park Town Center in Virginia. (Id. ¶¶ 17, 19.) Shay and Talbert also allege that they were never compensated for their final two weeks of work. (Id. ¶ 44.)

The defendants move to dismiss this case under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction and under Rule 12(b)(3) for improper venue, or, in the alternative, to transfer venue under 28 U.S.C. § 1404(a). (See Defs.' Mot. at 1.)

DISCUSSION

I. ADDRESSING VENUE BEFORE JURISDICTION

A federal court may "choose among threshold grounds for denying audience to a case on the merits." Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 585 (1999). "[C]ertain non-merits, non-jurisdictional issues may be addressed preliminarily, because '[j]urisdiction is vital only if the court proposes to issue a judgment on the merits.'" Pub. Citizen v. U.S. Dist. Court for D.C., 486 F.3d 1342, 1348 (D.C. Cir. 2007) (quoting Sinochem Int'l Co. Ltd. v. Malay. Int'l Shipping Corp., 127 S.Ct. 1184, 1191-92 (2007) (internal quotation marks omitted)). For example, a court may consider a question of forum non conveniens before addressing whether subject matter or personal jurisdiction exists because a forum non conveniens dismissal denies audience to a case on the merits. Sinochem, 127 S.Ct. at 1192. This principle also applies to cases raising questions involving transfer of venue. Aftab v. Gonzalez, 597 F. Supp. 2d 76, 79 (D.D.C. 2009). Because there is no automatic priority for sequencing jurisdictional issues, In re LimitNone, LLC, 551 F.3d 572, 576 (7th Cir. 2008), a court may decide questions of venue before addressing issues of personal or subject matter jurisdiction. See Kazenercom TOO v. Turan Petroleum, Inc., 590 F. Supp. 2d 153, 157 n.5 (D.D.C. 2008); Cheney v. IPD Analytics, LLC, 583 F. Supp. 2d 108, 117 (D.D.C. 2008).

II. ASSESSING VENUE

Rule 12(b)(3) "allows a case to be dismissed for improper venue." Fed. R. Civ. P. 12(b)(3). "'[T]he plaintiff... bears the burden of establishing that venue is proper.'" Walden v. Locke, 629 F. Supp. 2d 11, 13 (D.D.C. 2009) (quoting Varna v. Gutierrez, 421 F. Supp. 2d 110, 113 (D.D.C. 2006)). In considering a motion to dismiss for improper venue, a "court accepts the plaintiff's well-pled factual allegations regarding venue as true, draws all reasonable inferences from those allegations in the plaintiff's favor, and resolves any factual conflicts in the plaintiff's favor." Id. (internal quotation marks omitted). "To prevail on a motion to dismiss for improper venue, a defendant must present facts sufficient to defeat a plaintiff's assertion of venue." Id. (citing Darby v. U.S. Dep't of Energy, 231 F. Supp. 2d 274, 277 (D.D.C. 2002)). "If a case is filed in the wrong judicial district, a federal court in that district must dismiss the case or 'if it be in the interest of justice, transfer such case to any district or division in which it could have been brought.'" Ifill v. Potter, Civil Action No. 05-2320 (RWR), 2006 WL 3349549, at *1 (D.D.C. Nov. 17, 2006) (quoting 28 U.S.C. § 1406(a)).

When, as here, jurisdiction is not based solely on diversity of citizenship, the applicable venue provision is 28 U.S.C. § 1391(b). Under that statute, venue is proper in a judicial district (1) "where any defendant resides, if all defendants reside in the same State," (2) "in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated," or (3) "in which any defendant may be found, if there is no district in which the action may otherwise be brought." 28 U.S.C. § 1391(b)(1)-(3). A corporate defendant is deemed to reside in "any district in which it is subject to personal jurisdiction at the time the action is commenced." 28 U.S.C. § 1391(c).

Kaymanesh and Akrami reside in Virginia and SASSI is a Virginia corporation with its principal place of business in Dulles, Virginia. (Compl. ¶ 2; Defs.' Stmt. at 7, 12.) The plaintiffs allege that SASSI resides in the District of Columbia, and is subject to personal jurisdiction here, because it maintains continuous and systematic sales activities in the District of Columbia.*fn1 (Pls.' Opp'n at 1.) The plaintiffs invoke the District of Columbia's long-arm statute to establish that SASSI is subject to personal jurisdiction in the District of Columbia. (Id. at 2.)

The District's long-arm statute provides, in relevant part, that personal jurisdiction arises from a person's*fn2 "(1) transacting any business in the District of Columbia; [or] (2) contracting to supply services in the District of Columbia...." D.C. Code Ann. ยง 13-423(a)(1)-(2). Under this statute, personal jurisdiction is proper only when ...


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