Opinion ID: 804190
Heading Depth: 5
Heading Rank: 1

Heading: Time-Barred in Transferee Court

Text: The district court “note[d] that the parties agree that Plaintiffs action would not be time barred if filed in another district.” Grynberg, 666 F. Supp. 2d at 1239. The plaintiffs acknowledge, in their motion to transfer, that they previously stated that this factor was not applicable to their case. See Aplt. Opening Br. at 55 n.14; Aplt. App. at 1236. However, the plaintiffs argue that “since the filing of that motion, eighteen months have passed, and additional time will pass while this appeal is pending,” and that the plaintiffs would “face a substantial risk that their claims will now be time-barred in California.” Aplt. Opening Br. at 55 n.14; see id. at 54–55. That the plaintiffs’ claims may now be time-barred is not relevant to -43- whether the district court abused its discretion in finding that transfer was not in the interest of justice. This court “do[es] not expect district courts to predict the future with absolute precision. Furthermore, in determining whether a district court abused its discretion, we review the record before the court at the time of its decision, not events allegedly occurring thereafter.” Mason v. Okla. Turnpike Auth., 115 F.3d 1442, 1458 n.13 (10th Cir. 1997), overruled on other grounds by TW Telecom Holdings, Inc. v. Carolina Internet Ltd., 661 F.3d 495, 497 (10th Cir. 2011); see Regan-Touhy v. Walgreen Co., 526 F.3d 641, 648 (10th Cir. 2008) (“We generally limit our review on appeal to the record that was before the district court when it made its decision . . . .”). Rather than sit on their hands for more than eighteen months, the plaintiffs could have safeguarded their interests by filing a protective suit in the Eastern District of California—particularly after the district court issued its order dismissing for lack of personal jurisdiction on September 30, 2009. “‘[E]lementary prudence’ should have prompted plaintiffs’ lawyer to file a protective suit in a forum where personal jurisdiction was assured. Rather than file such a protective suit, [plaintiffs] . . . gambled their case on an extremely dubious theory of personal jurisdiction.” Saylor v. Dyniewski, 836 F.2d 341, 345 (7th Cir. 1988), superseded by statute on other grounds as stated in FMC Corp. v. Varonos, 892 F.2d 1308, 1310 n.5 (7th Cir. 1990); see McFarlane v. Esquire Magazine, 74 F.3d 1296, 1301 (D.C. Cir. 1996) (“[B]ecause of McFarlane’s . . . -44- inexplicable failure to file a protective suit, we think the district court was within its discretion in denying a transfer.”); Cote v. Wadel, 796 F.2d 981, 985 (7th Cir. 1986) (“Elementary prudence would have indicated to her lawyer that he must file a protective suit in Michigan because there was only a slight probability of obtaining personal jurisdiction in Wisconsin over the defendants. . . . We . . . remind plaintiffs and their counsel that they must determine where the plaintiff can get personal jurisdiction over the defendant before, not after, the statute of limitations runs; otherwise they court disaster.”). Accordingly, this factor weighs against transfer being in the interest of justice. b. Whether the Plaintiffs’ Claims Are Likely To Have Merit “[A] court is authorized to consider the consequences of a transfer by taking ‘a peek at the merits’ to avoid raising false hopes and wasting judicial resources that would result from transferring a case which is clearly doomed.” Haugh v. Booker, 210 F.3d 1147, 1150 (10th Cir. 2000) (quoting Phillips v. Seiter, 173 F.3d 609, 610–11 (7th Cir. 1999)); see Cline, 531 F.3d at 1252 (“Where there is no risk that a meritorious successive claim will be lost absent a § 1631 transfer, a district court does not abuse its discretion if it concludes it is not in the interest of justice to transfer the matter to this court for authorization.”). “[I]t is a waste of judicial resources to require the transfer of frivolous, time-barred cases.” Cline, 531 F.3d at 1252 (citing Phillips, 173 F.3d at 610)); -45- accord Daniel v. Am. Bd. of Emergency Med., 428 F.3d 408, 436 (2d Cir. 2005). 9 The district court stated that its “review of the complaint does not convince me that the claims likely have merit. . . . [A]lthough I make no determination of whether Plaintiffs[’] claims actually do have merit, I cannot say . . . that Plaintiffs[’] claims as set forth in the Amended Complaint are ‘likely to have merit.’” Grynberg, 666 F. Supp. 2d at 1239–40 (quoting Trujillo, 465 F.3d at 1223 n.16). The plaintiffs do not challenge the district court’s initial assessment of the merits of their claims. Instead, they argue that the district court “erred in placing the burden of proof on Plaintiffs to demonstrate their claims are ‘likely to have merit’ rather than on Defendants to demonstrate that the claims were so clearly without merit as to support a finding that transfer was not in the interest of justice.” Aplt. Opening Br. at 55–56. But it is the plaintiffs, not the defendants, who “have the burden of proving grounds for a transfer.” Stanifer, 564 F.3d at 459 n.1. In that respect, they have failed to offer a reasonable basis for questioning the district court’s finding, and their hollow assertions both in the district court and on appeal do not suffice to meet their burden. Accordingly, the second factor also weighs against transfer being in the interest of justice. 9 Neither Haugh nor Cline require a case to be “clearly doomed” for its transfer to weigh against the interest of justice. Rather, our touchstone is conserving judicial resources that would be wastefully expended by transferring cases that are likely without merit. -46- c. Whether the Plaintiffs’ Action Was Filed In Good Faith The district court “conclude[d] that there is at least some argument that this case was filed in Colorado even though Plaintiffs should have known that jurisdiction was not proper. . . . However, as these issues were at least somewhat difficult to resolve, . . . this factor neither weighs in favor [of] nor against transfer of the case.” Grynberg, 666 F. Supp. 2d at 1240. The plaintiffs make a conclusory argument that “there is at least a good faith dispute as to whether Colorado was a proper forum for this action. There is no indication that Plaintiffs ‘either realized or should have realized that [Colorado] was [an] improper [forum].’” Aplt. Opening Br. at 56 (alterations in original) (quoting Trierweiler, 90 F.3d at 1544). This argument provides this court with no basis to find that the district court improperly evaluated this factor. d. Judicial Economy and Prejudice The three factors set forth in Trujillo and Cline are not necessarily exclusive. See Cline, 531 F.3d at 1251 (“Factors considered in deciding whether a transfer is in the interest of justice include . . . .” (emphasis added)); Trujillo, 465 F.3d at 1223 n.16 (“[F]actors warranting transfer rather than dismissal . . . include . . . .” (emphasis added)). In addition to the three factors discussed above, the district court also considered whether the interests of judicial economy favored transfer, and concluded that they did not: “This case has not progressed beyond the issue of personal jurisdiction in Colorado and, therefore, little -47- pleading and no discovery will need to be repeated should Plaintiffs refile in California.” Grynberg, 666 F. Supp. 2d at 1240. It was appropriate for the district court to consider the interests of judicial economy here. 10 See 14D Charles Alan Wright, Arthur R. Miller, & Edward H. Cooper, Federal Practice and Procedure § 3827, at 589 (3d ed. 2007) (“District courts also are likely to order transfer . . . if it would be more efficient or economical to do so . . . .”). The plaintiffs do not challenge the district court’s judicial-economy finding on appeal. They do claim, however, that the district court’s dismissal of their action has subjected them to the defendants’ motion for more than $800,000 in attorneys’ fees and costs, and that this prejudice would have been avoided if the district court had transferred this action. But this is not the sort of prejudice that 28 U.S.C. § 1631 is concerned with. Compare, e.g., Goldlawr, Inc. v. Heiman, 369 U.S. 463, 466 (1962) (“[T]his case is itself a typical example of the problem sought to be avoided, for dismissal here would have resulted in plaintiff’s losing a substantial part of its cause of action under the statute of limitations . . . .”), with 10 As discussed above, such concerns also underlie the second inquiry—whether the plaintiffs’ claims are likely to have merit. See Cline, 531 F.3d at 1252 (“[I]t is a waste of judicial resources to require the transfer of frivolous, time-barred cases.” (citing Phillips, 173 F.3d at 610)); Haugh, 210 F.3d at 1150 (“[A] court is authorized to consider the consequences of a transfer by taking ‘a peek at the merits’ to avoid raising false hopes and wasting judicial resources that would result from transferring a case which is clearly doomed.” (quoting Phillips, 173 F.3d at 610)). -48- Witte v. Sloan, 250 F. App’x 250, 254 (10th Cir. 2007) (“Although Mr. Witte complains about the financial burden of a second filing fee and having to redraft pleadings, these are not the severe burdens that motivated the enactment of § 1406(a).”). e. Balancing in the Interest of Justice In sum, the district court properly found that the first two factors—whether the new action would be time-barred and whether the plaintiffs’ claims likely have merit—weigh against transfer, and the plaintiffs make only a conclusory argument challenging the district court’s finding that the third factor—whether they filed in good faith—was neutral. Moreover, they do not challenge the district court’s finding that judicial economy did not favor transfer, and their prejudice argument is without merit. Accordingly, even if the plaintiffs could meet their burden to show that the United States District Court for the Eastern District of California would have personal jurisdiction over the defendants, the interest of justice weighs against transfer, and the district court did not abuse its discretion by declining to transfer this action.