Court Opinion

ID: 9419959
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:52:19.474825+00
Date Added: 2024-06-11T17:22:21.330153
License: Public Domain

Mr. Justice Reed,
dissenting.
For the purposes of this case we may assume, without examining New York law, 153 F. 2d 888, 890, that a Federal District Court, in its discretion, can dismiss a cause on the ground that the forum is vexatiously inconvenient to the defendant. Still we think the exercise of such a power is not warranted in the circumstances of this case.
We need not restate the facts, which are amply set out by the majority. The sole inquiry is whether the exercise of discretion by the trial judge in this case was an abuse of his power. On motion of Lumbermens, joined in by no other defendant, for dismissal of the complaint on the grounds that the action would require interference by the court with the internal management of Lumbermens and that, further, an indispensable party had not been served, the trial court dismissed the complaint because it required interference with the internal affairs of a foreign corporation and because the forum was not convenient. The Circuit Court of Appeals affirmed the order of dismissal on the ground that the forum in which the action was brought was not convenient for the trial of the causes of action asserted by the complaint.
*534By a venue statute, Congress has provided that an action may be brought in the district where the plaintiff resides against defendants residing in other states than that of the forum. This plaintiff starts with a presumption in his favor that he may maintain this action at his own residence. 28 U. S. C. § 112.
We need not tarry to consider the small interest of the plaintiff in the assets of his corporation, nor the effect of realigning the corporation on the side of the cause where its true interest lies. However interesting the implications of these facts, they have nothing to do with a dismissal on the ground of the inconvenience of the forum. The same facts would exist no matter what the forum, and they are accordingly not pertinent to our inquiry. Nor should we concern ourselves with the possibility that this may be a strike suit. Whatever the motives of the plaintiff, the only inquiry now here is whether the forum is inconvenient or not.
In some cases, which may at the expense of analysis be grouped under the doctrine of forum non conveniens, the convenience of the court may be important. In such cases the crowded condition of the court’s calendar and its lack of familiarity with the law of another state may be weighty factors. But in those cases neither the defendant nor the plaintiff is a resident of the forum state. Western Union Telegraph Co. v. Russell, 12 Tex. Civ. App. 82, 83 S. W. 708; Robinson v. Oceanic Steam Nav. Co., 112 N. Y. 315, 19 N. E. 625; Burdick v. Freeman, 120 N. Y. 420, 24 N. E. 949; Morris v. Missouri Pacific R. Co., 78 Tex. 17, 14 S. W. 228; see cases collected in 32 A. L. R. at p. 34. Cf. Smith v. Empire State-Idaho Co., 127 F. 462. See also Davis v. Farmers Co-operative Co., 262 U. S. 312, 317. Such cases have the support of policy which hesitates to give an advantage to parties who do not bear the expense of supporting the courts of the forum. Douglas v. New York, N. H. & H. R. Co., 279 U. S. 377, 387. *535But where the cause is transitory and the plaintiff a resident of the forum state, the convenience to the court would seem to be outweighed by its duty to entertain actions brought by citizens of the state of which the court is an arm. See Arizona Commercial Mining Co. v. Iron Cap Copper Co., 119 Me. 213, 110 A. 429. Cf. Mexican Nat. R. Co. v. Jackson, 89 Tex. 107, 33 S. W. 857; Slater v. Mexican Nat. R. Co., 194 U. S. 120. This would seem particularly true of federal courts whose duty it is to entertain suits between citizens of different states. Williams v. Green Bay & W. R. Co., 326 U. S. 549, 553-4.
Since the plaintiff in this action is a resident of the forum state, we are only concerned with the relative convenience of the parties. It is clear that ordinarily a plaintiff may bring his suit in a forum of his choosing regardless of the inconvenience to him of making proof, so long as venue is properly laid. But here, as the Court points out, should the inconvenience to the defendant far outweigh any convenience to the plaintiff, it would not be fair to oppress the defendant, for it is not a legitimate advantage to a plaintiff to vex his opponent. We cannot agree, however, that in assessing the relative convenience of the parties the court may put a burden upon the plaintiff to make a positive showing that it is to his legitimate advantage to bring suit in the forum of his choosing. It is the defendant’s burden to convince the court that the forum is both inconvenient to it and not convenient to the plaintiff. Despite the necessity of going elsewhere for evidence, it is hardly capricious for a plaintiff to bring suit in his home state: the advantages of so doing are usually no less real than apparent.
Accordingly we must judge this case from the showing made by the defendant as to the relative convenience of the parties in its affidavits in support of its motion to dismiss. The defendant’s affiants urged that the suit be dismissed because all the proof would come from “vast quan*536tities of documents” and witnesses located in Illinois, where the main offices of Lumbermens are situated, and that transporting these documents would put the defendant to great expense. They also urged that the plaintiff had never attended any meetings of the corporation, nor ever protested to the Department of Insurance of Illinois which audited the books of Lumbermens, and that he was in a position where “the only proof personally to come from him is the establishment of his status as a policyholder.” They also urged that the court was being asked to pass upon the internal management and affairs of Lumbermens.
As to the last argument: it is recognized of course that a federal court need not entertain a case which involves interference with the internal affairs of a corporation. Rogers v. Guaranty Trust Co., 288 U. S. 123; but see Williams v. Green Bay & W. R. Co., 326 U. S. 549. The Circuit Court was of the opinion that no interference with the internal affairs of a foreign corporation of a kind “to make the courts of Illinois a more appropriate forum than New York” would be required by this action. This Court specifically concedes there is no problem of corporate administration that leads to refusal of jurisdiction in this case. This Court, however, depends upon the relation of the issues to the internal affairs of a corporation as one factor in the exercise of the court’s discretion to dismiss on the ground of jorum non conveniens. If corporate administration is not involved, the mere fact that the issues relate to the internal affairs of the corporation does not seem significant. Almost any suit against a corporation may involve an examination into corporate affairs. Here the only inquiry, other than the alleged misconduct of the defendant Kemper, has to do with the relationship between Kemper & Co. and Lumbermens. Although this inevitably involves inquiry into internal affairs of a corpo*537ration, as does any suit brought against a corporate fiduciary for breach of trust, that inquiry is hardly an interference with corporate administration.
When there is no showing of interference with corporate administration, the party seeking dismissal is forced to depend upon what “will best serve the convenience of the parties and the ends of justice.” This, we think, requires strong and clear proof to overcome the presumption that the place of trial is controlled by the venue statute. Mere inconvenience is not enough.
As for the expense to the defendant of bringing documents and witnesses to New York, even admitting that proof in this action will involve documentary evidence situated in Illinois or testimony of witnesses located in Illinois, it is not amiss to point out that the plaintiff must carry the burden in this action and must make his case before defense is necessary. Since both documents and witnesses are beyond the jurisdiction of the chosen forum, it will be the plaintiff’s expense initially to transport such records and witnesses, an inconvenience which he has determined to bear, if it is true that he has no other source of proof. But even supposing that the defendant will have to transport documents and witnesses to meet the plaintiff’s proof, a bare allegation to that effect is hardly a showing of such hardship as to make it proper to dismiss this case on the grounds of forum non conveniens. The same allegation might be made in any action brought against the defendant in any state other than Illinois on any cause, contract or tort, which involves records of the company, and this even though the corporation has chosen to do business in forty-eight states. To dismiss a cause on such bare allegations without a particular showing of the hardship involved in transporting a mass of documents and witnesses not easily accessible to the forum puts a powerful weapon into the hands of corporations alleged to *538have improperly conducted their affairs. It has been the whole course of our law to break down barriers against calling corporations to account in all states where they may do wrong in doing business. Neirbo Co. v. Bethlehem, Shipbuilding Corp., 308 U. S. 165. Lumbermens qualified in New York to carry on its regular insurance business. It sold plaintiff a policy that shares in the profits of that business and it should require a showing much stronger than any here made to require this policyholder to go away from home for relief.
Petitioner, on behalf of Lumbermens, seeks recovery for excessive payments and services by Lumbermens to those who dominate the company, and for sales of company assets to those persons at inadequate prices. Petitioner must prove these allegations. None are now denied by defendant. That petitioner’s success will result in “monetary damage” to Lumbermens seems impossible. Petitioner’s success will enrich Lumbermens at the expense of those who are alleged to have mulcted it of large sums. Petitioner speaks for the whole membership and all policyholders of Lumbermens. From this record, we do not see that an adequate basis of fact has been laid by the respondent’s affidavits to overcome the right of petitioner to pursue his remedies in the District Court for the Eastern District of New York
Mr. Justice Burton joins in this dissent.