Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-01053/USCOURTS-caed-2_06-cv-01053-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 05:551 Administrative Procedure Act

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These motions were determined to be suitable for decision *

without oral argument. L.R. 78-230(h).

The caption has been modified to correct an apparent **

typographical error. The Complaint names PREFERRED SHIPPERS, INC., as

a plaintiff in this action, but the captions used by the parties refer

to this plaintiff as “PREFERRED SHIPPERS, INC, INC.” The extra “INC”

has been deleted, and the parties shall incorporate this correction in

all future filings.

1

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

READY TRANSPORTATION, INC., a )

Texas corporation, AVAILABLE )

SHIPPERS, INC., a Texas ) 02:06-cv-1053-GEB-KJM

corporation, PREFERRED SHIPPERS, )

INC., a Nevada corporation, PROMPT )

SHIPPERS, INC., a Texas ) ORDER*

corporation, and QUICK )

TRANSPORTATION, INC., a Nevada )

corporation, )

)

Plaintiffs, )

)

v. )

)

AAR MANUFACTURING, INC., a )

California corporation, AAR )

MOBILITY SYSTEMS, a corporation of )

unknown citizenship, JEANNE )

LANGNESSER, an individual, DEFENSE )

CONTRACT MANAGEMENT AGENCY, an )

agency of the United States )

Government, and DEPARTMENT OF )

DEFENSE, an agency of the United )

States Government, )

)

Defendants. )

**

)

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Defendants AAR Manufacturing, Inc., AAR Mobility Systems,

and Jean Langnesser (collectively referred to as “Defendants”) move to

dismiss Plaintiffs’ claims against Jean Langnesser (“Langnesser”) for

lack of personal jurisdiction, to dismiss Plaintiffs’ claim under the

California Business and Professions Code section 17200 et seq. for

failure to state a claim, and for an order transferring this action to

the Western District of Michigan under 28 U.S.C. § 1404(a) (“section

1404(a)"). Plaintiffs oppose the motions. 

BACKGROUND

Plaintiffs, individual interstate carriers, are a group of

family-owned companies headquartered in Stockton, California, and

operating out of terminals throughout the United States. (Compl. ¶¶

1-6.) Defendants AAR Manufacturing, Inc., and AAR Mobility Systems

(collectively referred to as “AAR”) design and manufacture products

for the United States Department of Defense (“DOD”). (Id. ¶ 9.) 

Langnesser is an employee of AAR. (Id. ¶ 10.) AAR has a facility

located in California, but its shipments of freight from its

manufacturing facility in Cadillac, Michigan, are the focus of this

action. (Id. ¶¶ 8, 15-27.)

According to Plaintiffs, federal regulations require AAR “to

ship freight [originating from its Cadillac, Michigan, facility to the

DOD] with the lowest cost carriers . . . .” (Id. ¶ 9.) Plaintiffs

allege Defendants—specifically Langnesser—violated these regulations

by skipping over Plaintiffs and using higher-priced carriers for

shipments to the DOD. (Id. ¶¶ 10, 15-27.) Plaintiffs further allege

that these higher-priced carriers previously subcontracted with

Plaintiffs to make shipments to the DOD, but have stopped doing so

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since Langnesser informed them they would be “blackballed” like

Plaintiffs if they continued. (Id. ¶¶ 19-27.)

Based on the above allegations, Plaintiffs assert claims for

intentional interference with contractual relations, intentional

interference with prospective economic advantage, and unlawful

business practice under the California Business and Professions Code

section 17200 et seq. (the “UCL claim”) against AAR and Langnesser. 

DISCUSSION

I. Motion to Dismiss for Lack of Personal Jurisdiction

Langnesser argues Plaintiffs’ claims against her should be

dismissed under Rule 12(b)(2) for lack of personal jurisdiction. 

Plaintiffs respond that the Court may exercise personal jurisdiction

over Langnesser under the “effects test” announced in Calder v. Jones,

465 U.S. 783 (1984).

Plaintiffs have the burden of establishing personal

jurisdiction over Langnesser. Ziegler v. Indian River County, 64 F.3d

470, 473 (9th Cir. 1995). However, Plaintiffs “need only make a prima

facie showing of jurisdiction where, as here, the district court did

not hear testimony or make findings of fact.” Id. “In determining

whether [Plaintiffs] ha[ve] met [their] burden [of making a prima

facie showing], uncontroverted allegations in [Plaintiffs’]

[C]omplaint must be taken as true, and ‘conflicts between the facts

contained in the parties’ affidavits must be resolved in [Plaintiffs’]

favor . . . .’” Am. Tel. & Tel. Co. v. Compagnie Bruxelles Lambert,

94 F.3d 586, 588 (9th Cir. 1996) (quoting WNS Inc. v. Farrow, 884 F.2d

200, 203 (5th Cir. 1989)). 

Whether a nonresident defendant may be subjected to suit in

a particular forum depends “upon two inquiries: (1) whether a state

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statute of the forum confers personal jurisdiction over the

nonresident defendant and (2) whether the exercise of jurisdiction

accords with federal constitutional principles of due process.” Flynt

Distrib. Co., Inc. v. Harvey, 734 F.2d 1389, 1392 (9th Cir. 1984). 

“California’s long-arm [statute] permits the exercise of jurisdiction

to the limits of due process. Thus . . . analysis of personal

jurisdiction under California’s long-arm [statute] and the

Constitution collapse into one, and [the Court need only] consider

. . . whether the exercise of jurisdiction over [Langnesser] comports

with due process.” Glencore Grain Rotterdam B.V. v. Shivnath Rai

Harnarain Co., 284 F.3d 1114, 1123 (9th Cir. 2002) (citing Cal. Civ.

Proc. Code § 410.10). 

“Constitutional due process is satisfied when a non-resident

defendant has certain minimum contacts with the forum such that the

maintenance of the suit does not offend traditional notions of fair

play and substantial justice. Depending on the nature of a foreign

defendant’s contacts with the forum, a federal court may obtain either

specific or general jurisdiction over him.” Id. (citations and

punctuation omitted). Plaintiffs contend the Court may exercise

specific jurisdiction over Langnesser because “she clearly directed

her activities toward California and those activities have had a

profound effect upon [Plaintiffs] in California.” (Pls.’ Opp’n Defs.’

Mem. Supp. Mot. (“Opp’n”) at 7.) 

Whether specific jurisdiction exists is determined by a

three-part test: “(1) whether the defendant purposefully availed

himself of the privileges of conducting activities in the forum, (2)

whether the claim arises out of or results from the defendant’s

forum-related activities, and (3) whether the exercise of jurisdiction

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 Plaintiffs also seek leave to file a declaration of Scott 1

Brady in response to Langnesser’s Reply, arguing the Reply raised

arguments not presented in the original motion. Plaintiffs argue the

new argument raised in the Reply is that Langnesser was not aware

Plaintiffs resided in California and therefore could not have known harm

would be caused in California. Langnesser did not raise a new argument

in her Reply, rather she merely highlighted Plaintiffs’ failure to

present evidence on the “effects test.” Therefore, Plaintiffs’ request

for permission to file a sur-reply declaration is denied and Defendants’

motion to strike Scott Brady’s declaration, which Plaintiffs seek to

(continued...)

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is reasonable.” Glencore, 284 F.3d at 1123. “If any of the three

requirements is not satisfied, jurisdiction in the forum would deprive

the defendant of due process of law.” Omeluk v. Langsten Slip &

Batbyggeri A/S, 52 F.3d 267, 270 (9th Cir. 1995).

“When an intentional tort claim is asserted, purposeful

availment of the privilege of conducting activities in the forum state

can be met by the purposeful direction of a foreign act having effect

in the forum state.” CE Distrib., LLC v. New Sensor Corp., 380 F.3d

1107, 1111 (9th Cir. 2004). “Th[is] effects test is satisfied if the

defendant (1) commits an intentional act; (2) expressly aimed at the

foreign state; (3) causing harm in the foreign state that the

defendant knew was likely to be suffered in that state.” Id. 

Langnesser argues Plaintiffs cannot establish purposeful availment

under the “effects test” since they “offered absolutely no evidence”

“to establish . . . Langnesser knew her alleged actions would cause

harm in California.” (Defs.’ Reply Pls.’ Opp’n Defs.’ Mem. Supp. Mot

(“Reply”) at 5.) Plaintiffs argue the “effects test” is satisfied

because Langnesser “personally directed over 350 shipments of freight

into . . . California” and “prevented [Plaintiffs] from acting as a

subcontractor on these California freight movements . . . .” (Opp’n

at 6-7.)1

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file as their sur-reply, is granted.

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To satisfy the second and third prongs of the “effects

test,” Plaintiffs must show Langnesser “engaged in wrongful conduct

targeted at a [P]laintiff whom [she knew] to be a resident of

[California].” Bancroft & Masters, Inc. v. ugusta Nat’l Inc., 223

F.3d 1082, 1087 (9th Cir. 2000). Plaintiffs allege Langnesser

directed shipments of freight to California using other higher-priced

carriers and that she “blackballed” Plaintiffs. These allegations do

not establish that Langnesser knew any Plaintiff was a resident of

California. Accordingly, Plaintiffs have not shown Langnesser

expressly aimed her conduct at California or that she knew harm was

likely to be suffered in California because of her conduct. 

Therefore, Langnesser’s motion to dismiss for lack of personal

jurisdiction is granted.

II. Motion to Dismiss for Failure to State a Claim

AAR moves to dismiss Plaintiffs’ UCL claim for failure to

state a claim. AAR argues Plaintiffs’ UCL claim “improperly seeks the

extraterritorial application of a California statute” and should

therefore be dismissed. (Defs.’ Mem. Supp. Mot. (“Mot.”) at 5.) 

Plaintiffs counter they may assert the claim since they are California

residents who were harmed in California as a result of AAR’s conduct.

The court ruled in Norwest Mortgage, Inc. v. Superior Court,

72 Cal. App. 4th 214 (1999), that a UCL claim may be brought by

resident plaintiffs regardless of where the alleged misconduct

occurred. Norwest, 72 Cal. App. 4th at 222. Similarly, the court in

Yu v. Signet Bank/Virginia, 69 Cal. App. 4th 1377 (1999), allowed a

claim under the UCL by a California resident who was allegedly harmed

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by out-of-state misconduct. Yu, 69 Cal. App. 4th at 1381-82. “[R]ead

together, Norwest and Yu stand for the proposition that the UCL

applies to wrongful conduct that occurs out-of-state but results in

injury in California . . . .” Speyer v. Avis Rent A Car System, Inc.,

415 F. Supp. 2d 1090, 1099 (S.D. Cal. 2005). Accordingly, the UCL may

apply to AAR’s out-of-state conduct if it caused injury to Plaintiffs

in California.

Plaintiffs aver that as a result of AAR’s out-of-state

misconduct, “[Plaintiffs] must often return empty (or partially empty)

trucks to California,” which endangers the “financial health of

[Plaintiffs’] California terminals and operations.” (Opp’n at 3, 4.) 

Plaintiffs’ allegations of harm are sufficient to defeat AAR’s motion

to dismiss for failure to state a claim. 

III. Motion to Transfer

AAR argues this action should be transferred to the Western

District of Michigan under section 1404(a). Section 1404(a) provides:

“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.” 28 U.S.C. §

1404(a). The purpose of section 1404(a) is “to prevent the waste of

time, energy, and money and to protect litigants, witnesses and the

public against unnecessary inconvenience and expense.” Van Dusen v.

Barrack, 376 U.S. 612, 616 (1964). “Section 1404(a) is intended to

place discretion in the district court to adjudicate motions for

transfer according to an ‘individualized, case by case consideration

of convenience and fairness.’” Stewart Org., Inc. v. RICOH Corp., 487

U.S. 22, 29 (1988) (quoting Van Dusen, 376 U.S. at 622.). 

Accordingly, a motion to transfer lies within the broad discretion of

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the district court, and must be determined on an individualized basis. 

Jones v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000)

(citing Stewart Org., Inc., 487 U.S. at 29).

When deciding whether to transfer a case under section

1404(a) a district court must weigh several factors, including: “(1)

the plaintiff’s choice of forum; (2) the convenience of the parties;

(3) the convenience of the witnesses; and (4) the interests of

justice.” L.A. Mem’l Coliseum Comm’n v. Nat’l Football League, 89

F.R.D. 497, 499 (C.D. Cal. 1981). Plaintiffs concede this action

could have been brought in the Western District of Michigan;

therefore, the factors will be weighed to determine whether the

Western District of Michigan is a more convenient forum. (Opp’n at

13.) 

A. Plaintiffs’ Choice of Forum

Generally, a plaintiff’s choice of forum is given great

weight when deciding a motion to transfer. Louf v. Belzberg, 834 F.2d

730, 739 (9th Cir. 1987). AAR argues since “none of the operative

facts [of Plaintiffs’ Complaint] occurred within the Eastern District

of California, Plaintiff’s [sic] choice of forum is entitled to only

minimal consideration.” (Mot. at 9.) To support their position

Defendants cite Ellis v. Hollister, Inc., which states “[i]f the

operative facts have not occurred within the forum and the forum has

no interest in the parties or subject matter plaintiff’s choice is

entitled only minimal consideration.” Ellis v. Hollister, Inc., 2006

WL 1132377, at *1 (E.D. Cal. April 14, 2006) (quoting Louf, 834 F.2d

at 739) (quotation marks omitted). Plaintiffs argue their choice of

forum is entitled to “great weight” because “California has a great

interest in this litigation.” (Opp’n at 14.) 

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AAR’s assertion that none of the operative facts occurred in

California does not cause the Plaintiffs’ choice of forum to be given

minimal weight; AAR must also show that California “has no interest

in the parties or the subject matter.” Ellis, 2006 WL 1132377, at *1. 

AAR has made no argument relating to California’s interest in this

litigation. Plaintiffs, on the other hand, argue California does have

an interest in this litigation since the Complaint alleges purposeful

conduct taken by AAR against Plaintiffs who are located in and conduct

business in California. (Opp’n at 14.) These allegations are

sufficient to provide the forum with an interest in the litigation

sufficient to justify giving Plaintiffs’ choice of forum great weight. 

Therefore, “[AAR] must make a strong showing of inconvenience [based

on the other three factors] to warrant upsetting the [P]laintiff[s’]

choice of forum.” Decker Coal Co. v. Commonwealth Edison Co., 805

F.2d 834, 843 (9th Cir. 1986).

B. Convenience of the Parties 

AAR argues this factor favors transfer since “[a]ll . . .

Defendants reside and do business [in the Western District of

Michigan]” and “it would be just as convenient . . . for Plaintiffs to

litigate [there].” (Mot. at 9.) Plaintiffs contend litigation in

Michigan would be inconvenient for them because their “corporate

headquarters” is located in California, and their “long-term counsel

is located in California” and not admitted to practice law in

Michigan. Plaintiffs also argue “the physical condition and financial

strength” of AAR, as compared to Plaintiffs’, reveals it would be more

burdensome for Plaintiffs to litigate in Michigan than it would be for

AAR to litigate in California where “one of its major facilities” is

located. (Opp’n at 15.)

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This factor does not help either side. The competing

forums, the Eastern District of California and the Western District of

Michigan, are thousands of miles apart. For AAR, it is obviously more

convenient to litigate in Michigan, and for Plaintiffs, California. 

Moreover, Plaintiffs and AAR each have a facility in close proximity

to the other’s preferred forum. Geography, therefore, is a neutral

consideration. 

Further, Plaintiffs’ argument that their long-term counsel

will have to seek admission to the Western District of Michigan pro

hoc vice is also unhelpful to the balancing analysis. The convenience

of counsel is irrelevant when determining whether to transfer an

action under section 1404(a). In re Volkswagen AG, 371 F.3d 201, 206

(5th Cir. 2004); Solomon v. Cont’l Am. Life Ins. Co., 472 F.2d 1043,

1047 (3rd Cir. 1973). 

Finally, Plaintiffs have not shown that the parties’

financial positions are so different that the burden of litigating in

a distant forum should be bore by AAR rather than themselves. In

total, the convenience of the parties is a neutral consideration in

the balance.

C. Convenience of the Witnesses

AAR argues “Plaintiffs’ Complaint identifies four

significant third-part[ies]” located outside the “subpoena power of

this Court” but “within the subpoena power of the United States

District Court for the Western District of Michigan.” (Mot. at 10-

11.) AAR contends “[t]he testimony of these [parties] will be

critical” to their defense against Plaintiffs’ allegations. (Id. at

11.) “Rather than relying on ‘vague generalizations’ of inconvenience

[to possible witnesses], [AAR] must demonstrate, through affidavits or

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declarations containing admissible evidence, who the key witnesses

will be and what their testimony will generally include.” Cochran v.

NYP Holdings, Inc., 58 F. Supp. 2d 1113, 1119 (C.D. Cal. 1998). AAR

has not met this burden; therefore, this factor does not weigh in

favor of transfer. 

D. The Interests of Justice Factors

AAR argues “interest-of-justice factors weigh heavily in

favor of transfer” since “access to proofs is more convenient in the

Western District of Michigan” where AAR’s business records are, the

docket of the Western District of Michigan is less congested, and

Michigan law will be applied to Plaintiffs’ common-law claims. (Mot.

at 11-13.) Plaintiffs contend the location of business documents is

irrelevant to the balance, that court congestion “is not nearly great

enough” to justify transfer, and that California, not Michigan law,

applies to Plaintiffs’ common-law claims. (Opp’n at 16-18.)

The location of documents that may be “sources of proof” is

a relevant factor when deciding a motion to transfer. See Dole Food

Co., Inc. v. Watts, 303 F.3d 1104, 1119 (9th Cir. 2002) (stating “ease

of access to sources of proof” is a factor to be considered when

determining the convenience of an alternative forum). However,

“general allegations that transfer is needed for the ease of obtaining

records and books are not enough” to make the factor favor transfer. 

DeFazio v. Hollister Employee Share Ownership Trust, 406 F. Supp. 2d

1085, 1091 (E.D. Cal. 2005). AAR asserts “relevant records and

documents are generated and maintained at their [Cadillac, Michigan]

headquarters . . . [,]” but do not explain “how they might suffer

hardship or prejudice by having to defend this action in this

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district.” Id. Therefore, AAR has not shown that the location of

“sources of proof” favors transfer.

“Court congestion” is also a relevant factor when deciding a

motion to transfer. See Dole Food Co., Inc., 303 F.3d at 1119. 

Plaintiffs acknowledge the docket of this district is more congested

than the docket of the Western District of Michigan, and concede that

this factor “slightly favors” transfer. (Opp’n at 17.)

The determination of the law applicable to Plaintiffs’

common law claims requires analysis under California’s choice of law

provisions. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 243 n.8

(1981). But the Court need not determine what law applies here. 

Even, assuming Michigan law applies to Plaintiffs’ common law claims,

California law will still govern Plaintiffs’ claim for violation of

California’s Business and Professions Code. Therefore, the Western

District of Michigan would have to apply California law if the action

is transferred, and this Court may or may not have to apply Michigan

law if the action is not transferred. Since Claifornia law will

govern at least one of Plaintiffs’ claims, this factor does not favor

transfer.

 For the stated reasons, AAR has not established that this

action should be transferred to the Western District of Michigan. 

Accordingly, AAR’s motion to transfer is denied.

CONCLUSION

In conclusion, Langnesser’s motion to dismiss for lack of

personal jurisdiction is granted, AAR’s motion to dismiss Plaintiffs’ 

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UCL claim for failure to state a claim is denied, and AAR’s motion to

transfer this action is denied.

IT IS SO ORDERED.

Dated: July 27, 2006

/s/ Garland E. Burrell, Jr.

GARLAND E. BURRELL, JR.

United States District Judge

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