Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_15-cv-00303/USCOURTS-cand-3_15-cv-00303-2/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:2201 Constitutionality of State Statutes

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

I. INTRODUCTION

This is a dispute regarding insurance coverage for the 

allegedly defective construction of an airport runway in Los 

Angeles. None of the events giving rise to this lawsuit occurred 

here, and no party is a citizen of this district. Now before the 

Court is Defendant R&L Brosamer, Inc.'s ("Brosamer") motion to 

dismiss for improper venue or, in the alternative, to transfer 

venue to the Central District of California. The motions are fully 

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AMERICAN HOME ASSURANCE 

COMPANY,

Plaintiff, 

 v.

TUTOR-SALIBA CORPORATION/O&G 

INDUSTRIES, INC. JV; TUTORSALIBA CORPORATION; O&G 

INDUSTRIES, INC.; and R&L 

BROSAMER, INC.,

Defendants.

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Case No. 15-00303 SC

ORDER DENYING MOTION TO 

DISMISS AND TRANSFERRING CASE 

TO THE CENTRAL DISTRICT OF

CALIFORNIA

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United States District Court

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briefed,1 and the Court finds them suitable for disposition without 

oral argument pursuant to Civil Local Rule 7-1(b). For the reasons 

set forth below, Brosamer's motion to dismiss is DENIED, but 

Brosamer's alternative motion to transfer venue is GRANTED, and the 

Court ORDERS that this action be transferred to the Central 

District of California.

II. BACKGROUND

In 2003, the City of Los Angeles (the "City") decided to 

demolish, relocate, and rebuild a runway at Los Angeles World 

Airport. Compl. ¶¶ 15-16. The City contracted with Defendant 

Tutor-Saliba Corporation/O&G Industries, Inc. JV2 (the "Joint 

Venture") to demolish the old runway and build the new one. Id. ¶ 

21. The Joint Venture subcontracted with Defendant Brosamer for 

concrete and labor. Id. ¶ 25. Construction was complete by 2008. 

Id. ¶ 19. In 2013, the City filed a lawsuit in California Superior 

Court alleging that the Joint Venture and Brosamer's construction 

work was defective. Id. ¶¶ 20, 28-31. Plaintiff American Home 

issued insurance policies to the City, and Tutor and Brosamer may 

qualify as insureds under those policies. Id. ¶ 6. Tutor and 

Brosamer tendered the claims in the underlying action to American 

Home, which is providing them with defenses in that action under a 

full reservation of rights. Id. ¶¶ 7-8. American Home then 

brought this lawsuit, seeking a declaration that it does not owe

 

1 ECF Nos. 47 ("Mot."), 55 ("Opp'n"), 58 ("Reply").

2 Tutor-Saliba Corporation/O&G Industries, Inc. JV is a joint 

venture between Defendants Tutor-Saliba Corporation and O&G 

Industries, Inc. Compl. ¶ 10.

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any defendant a duty to defend the underlying action. Id. ¶¶ 47-

50.

III. LEGAL STANDARD

Venue is proper in (1) a judicial district in which any 

defendant resides, if all defendants are residents of the state in 

which that district is located; or (2) a judicial district in which 

a substantial part of the events giving rise to the claim occurred. 

28 U.S.C. § 1391(b). If no such district exists, venue is proper 

in any judicial district in which any defendant is subject to the 

court's personal jurisdiction with respect to the action. Id. For 

venue purposes, a defendant entity is a resident of any judicial 

district in which the defendant is subject to the court's personal 

jurisdiction with respect to the action in question. Id.

§ 1391(c).

Federal Rule of Civil Procedure 12(b)(3) allows a defendant to 

move to dismiss an action for improper venue. On a Rule 12(b)(3) 

motion, "the pleadings need not be accepted as true, and the court 

may consider facts outside of the pleadings," but the court must 

draw all reasonable inferences and resolve all factual conflicts in 

favor of the non-moving party. Murphy v. Schneider Nat'l, Inc., 

362 F.3d 1133, 1137 (9th Cir. 2004). When a case is filed in the 

wrong district, the court may dismiss it, or, if it is in the 

interest of justice, transfer it to any proper district. See 28 

U.S.C. § 1406(a).

Even if venue is proper where an action is filed, the Court 

may "[f]or the convenience of parties and witnesses, in the 

interests of justice . . . transfer any civil action to any other 

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District . . . where it might have been brought." 28 U.S.C. 

§ 1404(a). The Court must undertake an "individualized, case-bycase consideration of convenience and fairness." Jones v. GNC 

Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000). "To support 

a motion for transfer the moving party must show: (1) that venue is 

proper in the transferor district; (2) that the transferee district 

is one where the action might have been brought; and (3) that the 

transfer will serve the convenience of the parties and witnesses 

and will promote the interest of justice." Goodyear Tire & Rubber 

Co. v. McDonnell Douglas Corp., 820 F. Supp. 503, 506 (C.D. Cal. 

1992). The Court weighs a series of factors in determining whether 

the third element is satisfied, including:

(1) the location where the relevant agreements were 

negotiated and executed, (2) the state that is most 

familiar with the governing law, (3) the plaintiff's 

choice of forum, (4) the respective parties' contacts 

with the forum, (5) the contacts relating to the 

plaintiff's cause of action in the chosen forum, (6) the 

differences in the costs of litigation in the two forums, 

(7) the availability of compulsory process to compel 

attendance of unwilling non-party witnesses, and (8) the 

ease of access to sources of proof.

GNC Franchising, 211 F.3d at 498. Additionally, the Supreme Court 

has recognized "a local interest in having localized controversies 

decided at home." Piper Aircraft Co. v. Reyno, 454 U.S. 235, 260 

(1981). Thus, where a "case has a significant connection to the 

Los Angeles area . . . , the Central District has a much more 

substantial interest in seeing a resolution of th[e] litigation." 

Fabus Corp. v. Asiana Exp. Corp., No. C-00-3172 PJH, 2001 WL 

253185, at *2 (N.D. Cal. Mar. 5, 2001).

///

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///

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United States District Court

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IV. DISCUSSION

The Court begins by analyzing Brosamer's motion to dismiss. 

Because Brosamer lacks standing to bring that motion, it is DENIED. 

The Court then turns to the alternative motion to transfer venue 

and weighs the factors set out in GNC Franchising. The Court 

concludes that the factors weigh very strongly in favor of 

transferring this case to the Central District of California.

A. Motion to Dismiss for Improper Venue

Brosamer first argues that venue is improper in this district 

because Defendant O&G Industries, Inc. ("O&G") is not a resident of 

California. As a result, Brosamer argues, not all defendants are 

residents of California and venue is not proper under 28 U.S.C. 

Section 1391(b)(1). It is undisputed that the events giving rise 

to this claim -- including both the events giving rise to the 

underlying state court action and the state court action itself --

occurred in the Central District of California. Therefore, 

Brosamer argues, venue is proper in the Central District of 

California only, pursuant to Section 1391(b)(2).

Brosamer lacks standing to raise a venue objection on O&G's 

behalf. "[N]either personal jurisdiction nor venue is 

fundamentally preliminary in the sense that subject-matter 

jurisdiction is, for both are personal privileges of the defendant, 

rather than absolute strictures on the court, and both may be 

waived by the parties." Leroy v. Great W. United Corp., 443 U.S. 

173, 180 (1979). "Improper venue is a defense personal to the 

party to whom it applies. Thus one defendant may not challenge 

venue on the ground that it is improper as to a co-defendant." 

Pratt v. Rowland, 769 F. Supp. 1128, 1132 (N.D. Cal. 1991). A 

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defendant may bring a motion to dismiss for improper venue only in 

his first response to a complaint. Id. ("[D]efendants wishing to 

raise improper venue as a defense must do so in their first 

defensive move.") (emphasis in original). O&G has answered 

American Home's complaint and, though O&G denied that all 

defendants are residents of California, it has not joined 

Brosamer's motion, nor has it contested venue in any way. See ECF 

No. 61 ("O&G Answer") ¶ 14. Therefore, O&G has forfeited its 

opportunity to contest venue, and Brosamer may not raise the issue 

on O&G's behalf. The motion to dismiss is DENIED.

B. Transfer of Venue

The Court turns now to Brosamer's alternative motion to 

transfer venue to the Central District of California. At the 

outset, it is important to note that nowhere in its fourteen page 

opposition brief does American Home offer a single reason that this 

case should be litigated in San Francisco. The closest it comes is 

a plea that its choice of forum should be "accorded deference," but 

it offers no explanation or reason for that choice. See Opp'n at 

10. On the other hand (and as explained more fully below), there 

are ample and obvious reasons that this case should be tried in the 

Central District, including that all of the events giving rise to 

this action occurred there, the insurance policies at issue were 

executed there, any witnesses or documentary evidence relevant to 

this case is there, and the underlying litigation is being heard in 

courts there.

1. Proper Venue in Transferor District

As described above, Brosamer contests only O&G's California 

residency. Brosamer does not deny that it and Tutor-Saliba are 

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both residents of California, nor does it deny that at least one of 

them is a resident of the Northern District. Therefore, venue is 

proper in this district so long as all defendants are residents of 

California. See 28 U.S.C. § 1391(b)(1). Under 28 U.S.C. Section 

1392(d), O&G is a resident of the Central District of California if 

its contacts with that district are sufficient to subject it to 

personal jurisdiction there. Because the Central District of 

California is in California, O&G's residency in that district would 

presumably render it a resident of California as a whole for the 

purposes of Section 1391(b)(1).

American Home does not allege that O&G is subject to general 

jurisdiction anywhere in California. Instead, American Home argues 

that O&G is subject to specific personal jurisdiction. The Ninth 

Circuit has established a three-prong test for determining specific 

jurisdiction:

(1) The non-resident defendant must purposefully direct 

his activities or consummate some transaction with the 

forum or resident thereof; or perform some act by which 

he purposefully avails himself of the privilege of 

conducting activities in the forum, thereby invoking the 

benefits and protections of its laws;

(2) the claim must be one which arises out of or relates 

to the defendant's forum-related activities; and

(3) the exercise of jurisdiction must comport with fair 

play and substantial justice, i.e. it must be reasonable.

Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th 

Cir. 2004). The plaintiff bears the burden of satisfying the first 

two prongs and, if it does, the burden then shifts to the defendant 

to show why the exercise of personal jurisdiction would be 

unreasonable. Id.

The allegations in the complaint make it clear that O&G is 

subject to personal jurisdiction in the Central District of

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California. O&G formed a joint venture with Tutor-Saliba, a 

citizen of the Central District. Compl. ¶ 10. O&G then contracted

(through the Joint Venture) with the City of Los Angeles to perform 

construction work for the City in the Central District. Id. ¶ 21. 

O&G therefore purposefully directed its activities at the Central 

District and consummated a transaction with at least two residents 

of the Central District (Tutor-Saliba and the City). This claim 

also arises out of and relates to those activities: the work O&G 

performed in Los Angeles through its joint venture was allegedly 

defective, and this is a related insurance lawsuit. There is no 

indication that the exercise of jurisdiction in California does not

comport with fair play and substantial justice; no defendant has 

suggested that the exercise of jurisdiction in California would be 

unfair.3

As a result, the Court finds that all defendants are residents 

of California and that at least one is a resident of this district. 

As a result, venue is proper here pursuant to 28 U.S.C. Section 

1391(b)(1).

2. Action Might Have Been Brought in Transferee 

District

It is undisputed that venue is proper in the Central District 

of California. As described above, all defendants are residents of 

California, and at least two are residents of the Central District 

(O&G through of its contacts related to this litigation, and TutorSaliba by its principal place of business). Therefore venue is 

 

3 Indeed, O&G has answered American Home's complaint. While O&G 

suggested that at least one defendant might not be a resident of 

California, see O&G Answer ¶ 14, O&G never contests personal 

jurisdiction.

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proper in the Central District pursuant to 28 U.S.C. Section 

1391(b)(1). It also undisputed that venue is proper in the Central 

District pursuant to 28 U.S.C. Section 1391(b)(2) because the 

events from which this suit arose took place there.

3. Convenience and Interests of Justice

The Court now weighs the factors the Ninth Circuit has 

identified as relevant to determining whether a transfer of venue 

serves the convenience of the parties and the interests of justice.

i. Location Where the Agreements Were Executed

The contracts at issue in this case are the insurance policies 

that American Home issued to the City. All of them were issued to 

the City of Los Angeles for a construction project that took place 

there. Compl. ¶ 6. They do not specify where they were executed, 

but all of the policies list addresses for both the insured and 

producer in Los Angeles. See Compl. Exs. B at 16; C at 2; D at 3; 

E at 4; F at 3, 10. The Court finds that this factor weighs in 

favor of a transfer of venue.

ii. State Most Familiar With Governing Law

This district and the Central District are both in California. 

Both are equally familiar with California law. This factor is 

neutral.

iii. Plaintiff's Choice of Forum

Plaintiff American Home chose this district as the forum for 

this lawsuit and, by its opposition to this motion, demonstrated a 

strong preference for this suit to be heard in this district. 

Strangely, though, American Home is either unwilling or unable to 

articulate a single reason for that preference. American Home is 

incorporated in Pennsylvania and has its principal place of 

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business in New York. Compl. ¶ 9 "A plaintiff's choice of forum 

is generally accorded substantial weight, and the defendant 

therefore bears a considerable burden in justifying transfer." 

Animal Legal Def. Fund v. U.S. Dep't of Agric., No. CV 12-4407-SC, 

2013 WL 120185, at *4 (N.D. Cal. Jan. 8, 2013). However, "where 

the operative facts have not occurred within the forum of original 

selection and that forum has no special interest in the parties or 

subject matter, the plaintiff's choice of venue merits less 

deference." Id. Additionally, "a plaintiff's choice is also given 

less deference when the plaintiff resides outside of the chosen 

forum." Brown v. Abercrombie & Fitch Co., No. 4:13-CV-05205 YGR, 

2014 WL 715082, at *3 (N.D. Cal. Feb. 14, 2014); see also Gemini 

Capital Grp., Inc. v. Yap Fishing Corp., 150 F.3d 1088, 1091 (9th 

Cir. 1998) ("the district court correctly acted on Ninth Circuit 

authority in granting Plaintiffs' choice of Hawaii as a forum less 

deference" where no plaintiff was a resident of Hawaii); Pac. Car & 

Foundry Co. v. Pence, 403 F.2d 949, 954 (9th Cir. 1968) ("If the 

operative facts have not occurred within the forum of original 

selection and that forum has no particular interest in the parties 

or the subject matter, the plaintiff's choice is entitled only to 

minimal consideration."). Thus the Court finds that this factor 

favors maintenance of this action in this district, but the Court 

assigns it very little weight.

iv. Respective Parties' Contacts with the Forum

There is little evidence of the respective parties' contacts 

with this forum. American Home asserts that Defendant Tutor-Saliba 

Corporation has "an extensive presence in the Northern District and 

particularly in the San Francisco Bay Area." Opp'n at 13. 

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However, Tutor-Saliba's principal place of business is in Sylmar, 

California, which is in the Central District. Compl. ¶ 10. In 

fact, no party is is headquartered here. American Home is 

incorporated in Pennsylvania and has its principal place of 

business in New York; O&G is incorporated in Connecticut and has 

its principal place of business in Connecticut; Brosamer operates 

as the regional office of a parent company headquartered in 

Chicago. Id. ¶¶ 10-11; ECF No. 49 ("Klupp Decl.") ¶ 2, Ex. A. 

Thus there is no indication that any party to this case has any

relevant connection to this district. By contrast, every party was 

either involved in the construction or insurance of the

construction project that occurred in the Central District. The 

Court finds that this factor favors a transfer of venue. 

v. Contacts Relating to Plaintiff's Cause of 

Action in the Chosen Forum

No party has any contacts to this forum that relate to the 

Plaintiff's cause of action. The construction project that forms 

the basis of this action occurred in the Central District; the 

insurance policies at issue in this case were issued to the City of 

Los Angeles, which is in the Central District; and the underlying 

state court lawsuit is taking place in the Central District. There 

is no connection whatsoever between this lawsuit and the Northern 

District of California. By contrast, every party has substantial 

contacts with the Central District relating to American Home's 

cause of action. The Court finds that this factor strongly favors 

a transfer of venue.

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vi. Differences in Costs of Litigation

American Home makes no argument that it will be cheaper to 

litigate this case in San Francisco. On the other hand, the 

underlying action is already being litigated in Los Angeles, no 

potentially relevant witnesses or evidence is located in the 

Northern District (much of the evidence is likely to be located in 

the Central District), and the parties' counsel is located in Los 

Angeles. The Court finds that it will likely be significantly more 

cost effective to try this case in the Central District. This 

factor, too, favors a transfer of venue.

vii. Compulsory Process to Procure Witnesses

Federal Rule of Civil Procedure 45(a)(2) requires a subpoena 

to issue from the court where the action is pending. Were venue to 

remain in this district, this Court would therefore be required to 

issue any subpoenas necessary to procure witnesses. But those 

witnesses are likely to be in the Central District, and motions to 

quash or modify would be made in the Central District. Those 

motions could be granted there or transferred back to this 

district. See Fed. R. Civ. P. 45(d)(3) (requiring court where 

compliance with subpoena is sought to quash or modify improper 

subpoenas); Fed. R. Civ. P. 45(f) (permitting compliance court to 

transfer motions to issuing court). If such a motion were 

transferred to this Court, the Court would then need to transfer 

its order back to the Central District for enforcement. See Fed. 

R. Civ. P. 45(f). Thus while this Court has the necessary power to 

procure witnesses in this case, the process would be much simpler 

if this case were heard in the Central District of California.

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viii. Ease of Access to Sources of Proof

To the extent that witnesses or documentary evidence will be 

necessary to resolve this case, it is undisputed that those 

witnesses and that evidence are located in the Central District. 

All of the events from which this action arose, whether related to 

the construction project or the underlying litigation, occurred in 

the Central District. Indeed, American Home does not even attempt 

to argue that any relevant evidence is located in the Northern 

District. Instead, American Home makes the case that this action 

is purely a matter of law and that no evidence will be required. 

See Opp'n at 11-13. Brosamer disagrees and produces examples of 

witnesses located in the Central District who may provide relevant 

evidence. See Mot. at 11-12; Reply at 9-11. The Court is not yet 

in a position to determine the admissibility of all of the evidence 

(or potential evidence) that the parties discuss. However, the 

Court notes that American Home's pending motion for summary 

judgment absolutely touches on factual issues to which witness or 

documentary evidence may be relevant -- for example, the extent to 

which Defendants' construction work was defective. It is obvious 

and undisputed that almost all witnesses and evidence relevant to 

this case are located in the Central District, and that none are 

located here. The Court finds that this factor favors a transfer 

of venue.

ix. Local Interest

The City of Los Angeles purchased the insurance policies at 

issue in this case, and the extent of the coverage offered by those 

policies is at issue. The policies were issued to an insured 

located in Los Angeles by producers located in Los Angeles. The 

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City of Los Angeles contracted for the allegedly defective 

construction work, and that work was done in Los Angeles. 

Defendant Tutor-Saliba is based in the Central District, while no 

party to this case is a citizen of this district. Finally, the 

underlying lawsuit is taking place in Los Angeles. For all of 

these reasons, the Central District has a substantial interest in 

the resolution of this case. This district has no such interest 

whatsoever.

4. Conclusion

Venue is proper in both this district and the Central District 

of California. However, it is abundantly clear that the 

convenience of the parties and the interests of justice 

overwhelmingly favor maintenance of this lawsuit in the Central 

District. Of the factors identified in GNC Franchising, only one, 

the plaintiff's choice of forum, weighs against a transfer. But 

the Court accords that factor very little weight because none of 

the events from which this case arose took place in this district

and because the plaintiff is not a citizen or resident of this 

district. One factor is neutral. The others all favor 

transferring this case to the Central District. The facts make it 

obvious that it will be easier, faster, and more cost effective to 

litigate this case in the Central District, where virtually all of 

the events giving rise to this case occurred and where the 

underlying state court lawsuit is being tried. Brosamer's motion 

to transfer venue to the Central District of California is GRANTED.

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V. CONCLUSION

For the foregoing reasons, Defendant R&L Brosamer, Inc.'s 

motion to dismiss for improper venue is DENIED. Brosamer's

alternative motion to transfer venue is GRANTED. The Court DIRECTS 

the Clerk to transfer this case to the Central District of 

California. All pending motion hearing dates are hereby VACATED.

IT IS SO ORDERED.

May 12, 2015

UNITED STATES DISTRICT JUDGE

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