Court Opinion

ID: 9374764
Source: CourtListenerOpinion
Date Created: 2023-02-23 21:00:54.520408+00
Date Added: 2024-06-11T17:16:52.742587
License: Public Domain

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                                               UNPUBLISHED

                               UNITED STATES COURT OF APPEALS
                                   FOR THE FOURTH CIRCUIT

                                                 No. 22-1070

        PRECISION WEATHER SOLUTIONS INC.,

                     Plaintiff - Appellant,

                     v.

        FARMERS EDGE INC.; FARMERS EDGE (US), INC.,

                     Defendants - Appellees.

        Appeal from the United States District Court for the Eastern District of Virginia, at
        Alexandria. Liam O’Grady, Senior District Judge. (1:21-cv-00821-LO-IDD)

        Submitted: November 28, 2022                                  Decided: February 22, 2023

        Before THACKER, HARRIS, and HEYTENS, Circuit Judges.

        Affirmed by unpublished per curiam opinion.

        ON BRIEF: Donald E. Stout, FITCH, EVEN, TABIN & FLANNERY LLP, Washington,
        D.C.; Mark L. Hogge, R. Tyler Goodwyn IV, Nicholas H. Jackson, Elissa C. Jeffers, Song
        K. Jung, DENTON US LLP, Washington, D.C., for Appellant. Tiffany R. Caterina, Los
        Angeles, California, Glenda Dieuveille, FRANKFURT KURNIT KLEIN + SELZ PC,
        New York, New York; Edward John Steren, EPSTEIN BECKER GREEN, Washington,
        D.C., for Appellees.

        Unpublished opinions are not binding precedent in this circuit.
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        PER CURIAM:

               This case began as a contract dispute between two Canadian companies, Precision

        Weather Solutions Inc. and Farmers Edge Inc. When a Canadian court denied Precision

        Weather a preliminary injunction against Farmers Edge, Precision Weather filed a similar

        suit in federal court in the Eastern District of Virginia. That court dismissed Precision

        Weather’s case under the doctrine of forum non conveniens, and Precision Weather now

        appeals. For the reasons given below, we affirm.

                                                     I.

               Precision Weather Solutions Inc. is a Canadian corporation based in the province of

        Manitoba, offering weather forecasting services to its clients through a software platform.

        Farmers Edge Inc., also a Canadian corporation with its principal place of business in

        Manitoba, entered into a series of agreements with Precision Weather to license its software

        platform.

               Disputes soon emerged and Farmers Edge sued Precision Weather in Canadian court

        in Manitoba.     Precision Weather counterclaimed, alleging that Farmers Edge had

        misappropriated its intellectual property and incorporated it into its own software platform.

        In March 2021, the Canadian court denied Precision Weather a preliminary injunction.

               Soon after, Precision Weather filed the instant suit in the Eastern District of

        Virginia. Precision Weather’s action was based on the same underlying events as the

        Canadian action and raised similar claims, though it also added new claims for

        misappropriation of trade secrets under federal and Virginia state law. See 18 U.S.C.

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        § 1386; Va. Code §§ 59.1-336-59.1-343.             Precision Weather also added a second

        defendant: Farmers Edge (US), Inc., a Minnesota subsidiary of Farmers Edge. According

        to Precision Weather, the district court had personal jurisdiction over its case because the

        two defendants conducted business in the Eastern District of Virginia, and venue was

        proper because some part of its injuries also arose in that district.

               The defendants moved to dismiss Precision Weather’s action on multiple grounds,

        including lack of personal jurisdiction and improper venue. The upshot of their argument

        was that the original court in Manitoba, Canada, and not the Eastern District of Virginia,

        remained the appropriate venue for adjudication of the case: Precision Weather’s claims

        involved disputes between two Canadian companies, based on conduct that occurred

        primarily in Canada; as a result, all the key documents and witnesses were in Canada; and

        the current action was duplicative of the still-pending Canadian litigation.

               After initial proceedings and a first ruling that need not be detailed here, Precision

        Weather moved to disqualify the district court judge. According to Precision Weather, the

        judge’s “impartiality might reasonably be questioned,” see 28 U.S.C. § 455(a), because he

        held a bank account at a financial institution that Precision Weather might want to call as

        an expert witness, to opine on the valuation of Farmers Edge.

               Ultimately, the district court dismissed Precision Weather’s action under the

        doctrine of forum non conveniens, a common-law doctrine that allows for dismissal “when

        an alternative forum exists, is available and is more convenient for the parties.” Precision

        Weather Sols. Inc. v. Farmers Edge Inc., No. 1:21-cv-00821 (E.D. Va. Jan. 12, 2022),

        J.A. 1919 (citing BAE Sys. Tech. Sol. & Servs., Inc. v. Republic of Korea’s Def. Acquisition

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        Program Admin., 884 F.3d 463 (4th Cir. 2018)). The district court’s decision rested on

        two independent and alternative grounds. J.A. 1919–21.

               First, the court relied on a forum-selection clause in a confidentiality agreement

        between Precision Weather and Farmers Edge, which provided that “the parties submit to

        the exclusive jurisdiction of the Courts of Manitoba.” J.A. 1916. That clause, the court

        concluded, was properly construed as mandatory, exclusive, and applicable to the pending

        complaint. J.A. 1918. Under well-established Fourth Circuit precedent, the court finished,

        such clauses control in all but the most exceptional cases, and Precision Weather had done

        nothing to meet its burden of overcoming that presumption. J.A. 1919; see BAE Sys.,

        884 F.3d at 470–71 (4th Cir. 2018) (describing the modified forum non conveniens

        standard triggered by a mandatory forum-selection clause).

               Second, the district court conducted what it termed the “traditional analysis of forum

        non conveniens,” J.A. 1919 – that is, the analysis that applies in the absence of a forum-

        selection clause. The threshold question, the court explained, was whether there was an

        “available and adequate” alternative forum for the action. Id. at 1920. Here, the court

        concluded, the Canadian forum clearly was available, as the parties already were litigating

        there. Id. And even if, as Precision Weather alleged, certain remedies it sought would not

        be available in Canadian court, that would not by itself render the Canadian forum

        “inadequate.” Id. (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 258 (1981)). The court

        then considered the “ultimate inquiry” of where trial would “best serve the convenience of

        the parties and the ends of justice.” Id. (quoting DiFederico v. Marriot Int’l., Inc., 714 F.3d

        796, 804 (4th Cir. 2013). The court had little difficulty in determining that the balance of

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        public and private factors favored the Canadian forum: the parties are two Canadian

        companies and a subsidiary of a Canadian company; it would be “clearly more convenient”

        for the case to be litigated in Canada, and decidedly inconvenient for the parties to litigate

        a “duplicative proceeding” in Virginia; and Canada has a “local interest in having localized

        controversies decided at home.” Id. (internal quotation marks omitted).

               Accordingly, the district court dismissed Precision Weather’s case with prejudice

        on forum non conveniens grounds alone. J.A. 1923. 1 Precision Weather noted its appeal

        the next day. A few weeks after that, the district court issued an order regarding Precision

        Weather’s recusal motion, explaining that the motion was denied because nothing about

        holding a bank account at an institution that might (or might not) be called as an expert

        witness could call into question the court’s impartiality. Precision Weather Sols. Inc. v.

        Farmers Edge Inc., No. 1:21-cv-00821 (E.D. Va. Feb. 4, 2022), J.A. 1926–27.

                                                     II.

               On appeal, Precision Weather primarily challenges the dismissal of its action on

        forum non conveniens grounds. It also argues that the district court improperly denied its

        motion to recuse. Substantially for the reasons given by the district court, we affirm.

               1
                  As the district court explained, its forum non conveniens determination made it
        unnecessary to address the defendants’ alternative grounds for dismissal. J.A. 1921; see
        Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422, 432 (2007) (court may
        dismiss on threshold forum non conveniens grounds without resolving underlying
        jurisdictional issues).

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                                                     A.

               We begin with the district court’s forum non conveniens determination, which is

        “committed to the sound discretion of the trial court.” Piper Aircraft, 454 U.S. at 257; see

        Tang v. Synutra Int’l., Inc., 656 F.3d 242, 248, 253 (4th Cir. 2011) (applying abuse of

        discretion standard). We discern no abuse of discretion in the district court’s finding that

        a traditional forum non conveniens inquiry favors a Canadian forum. We therefore affirm

        the district court on that ground alone, without addressing the potential effect of the

        contractual forum-selection clause.

               The forum non conveniens analysis requires a court to consider whether an

        alternative forum was “available” and “adequate,” and, if so, whether it was “more

        convenient in light of the public and private interests involved.” Tang, 656 F.3d at 248

        (setting out standard). Ordinarily, there is a strong presumption in favor of the plaintiff’s

        choice of forum, but “because the central purpose of any forum non conveniens inquiry is

        to ensure that the trial is convenient,” the choice of a foreign plaintiff like Precision

        Weather “deserves less deference.” Piper Aircraft, 454 U.S. at 256. And as the district

        court explained, a court retains the authority to dismiss on forum non conveniens grounds

        even when, as here, a defendant has not sought that remedy, at least in so many words.

        J.A. 1920–21; see also United States v. Moussaoui, 483 F.3d 220, 236 (4th Cir. 2007)

        (discussing inherent authority of courts to dismiss sua sponte on grounds of forum non

        conveniens); cf. J.A. 58–60, 1546–47 (Farmers Edge arguing that Canadian forum is

        available and would be more convenient in seeking dismissal on venue grounds).

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               As the district court recognized, the threshold forum non conveniens inquiry is into

        the “availability” and “adequacy” of an alternative forum. J.A. 1920. “Availability will

        ordinarily be satisfied when the defendant is amenable to process in the other jurisdiction,”

        Tang, 656 F.3d at 249 (internal quotation marks omitted), and here, as the district court

        explained, parallel litigation already has commenced in Canadian court. 2          Precision

        Weather focuses primarily on “adequacy,” arguing that its Canadian forum is not

        “adequate” because Canadian law does not recognize its newly-alleged claims for trade

        secret appropriation and will limit it to recovery on its other claims. But as the district

        court explained, that specific causes of actions or remedies may be unavailable in a foreign

        venue does not, without more, render that forum inadequate. See Piper Aircraft, 454 U.S.

        at 247, 250 (holding that application of “less favorable” law in alternative forum does not

        by itself preclude forum non conveniens dismissal and generally should not be given

        “substantial weight” in analysis); Tang, 656 F.3d at 250 (explaining that foreign forum is

        not “inadequate” merely because the plaintiffs “may not enjoy the same benefits as they

        might receive in an American court” (internal quotation marks omitted)). Nor is this a case

               2
                 Precision Weather suggests, for the first time on appeal, that the Canadian court
        might lack jurisdiction over new defendant Farmers Edge (US), the Minnesota subsidiary
        of Farmers Edge. Ordinarily we do not consider arguments that the parties did not press
        before the district court. See In re Under Seal, 749 F.3d 276, 285 (4th Cir. 2014). In any
        event, the core of Precision Weather’s claim is against Farmers Edge, based on that
        Canadian company’s alleged theft of proprietary information in Canada. If Farmers Edge
        (US) is meaningfully implicated in that conduct in some way independent of Farmers Edge,
        then we do not doubt that a Canadian court could assert jurisdiction over the entire dispute,
        notwithstanding Farmers Edge (US)’s American domicile – as even the cases cited by
        Precision Weather suggest. See Club Resorts Ltd. v. Van Breda, [2012] 1 S.C.R. 572
        (Can.).

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        in which it can be said that the remedy provided by the foreign forum is so empty that it

        amounts to “no remedy at all,” Piper Aircraft, 454 U.S. at 254, given that Precision

        Weather already has asked the Canadian court to grant it meaningful relief – damages and

        an injunction – on its claims of fraud in the inducement, conversion, and unjust enrichment,

        all arising from the same alleged misappropriation of intellectual property.

               That leaves the final weighing of the relevant private and public interest factors to

        determine “where trial will best serve the convenience of the parties and the ends of

        justice.” DiFederico, 714 F.3d at 804 (internal quotation marks omitted). Again, we find

        eminently reasonable the district court’s conclusion that these factors favor a Canadian

        forum. As the district court explained the parties to this case are two Canadian corporations

        and one of their subsidiaries, which means that it “clearly is more convenient” to continue

        litigating the case in Canada: As Farmers Edge argued before the district court, Canada,

        not Virginia, is where the witnesses and documentary evidence are located. J.A. 1920; see

        Tang, 656 F.3d at 252 (identifying “relative ease of access to sources of proof” as key

        private interest factor (internal quotation marks omitted)). By the same token, litigating a

        “duplicative proceeding concerning the same factual questions” in Virginia, where no party

        is domiciled and no misappropriation of technology is alleged to have occurred, would be

        cumbersome and inconvenient. J.A. 1920. And finally, as the district court recognized, in

        this Canada-centric case – alleging that one Canadian corporation entered into Canadian

        contracts to access another Canadian corporation’s technology and then misappropriated

        that technology in Canada – Canada has a “local interest in having [this] localized

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        controvers[y] decided at home.” Piper Aircraft, 454 U.S. at 260 (internal quotation marks

        omitted).

                                                     B.

               Precision Weather also argues that its motion to disqualify the district court judge

        was improperly denied. Again, we disagree.

               We review a district court’s recusal decision for abuse of discretion. See Kolon

        Indus. Inc. v. E.I. DuPont de Nemours & Co., 748 F.3d 160, 167 (4th Cir. 2014). Under

        28 U.S.C. § 455(a), a district judge shall disqualify himself from “any proceeding in which

        his impartiality might reasonably be questioned.”        Here, Precision Weather sought

        disqualification because the district court judge had a “financial relationship” with

        Raymond James Ltd. – in the form of a bank account – which was a problem because

        Precision Weather might want to depose Raymond James, a Farmers Edge underwriter, as

        an expert witness regarding Farmer Edge’s valuation.

               We perceive no “reasonable basis . . . for doubting the judge’s impartiality.” In re

        Beard, 811 F.2d 818, 827 (4th Cir. 1987) (denying writ of mandamus to disqualify district

        court judge). First, as the district court explained, a bank account is not the kind of

        “financial interest” that may give rise to a perceived conflict of interest here, in that its

        value would not be affected by the financial well-being of Raymond James. J.A. 1927; see

        28 U.S.C. § 455(d)(4) (defining “financial interest” for recusal purposes). Moreover, again

        as the district court explained, there also is no account for how Raymond James itself could

        be affected by litigation in which it participated only as an expert witness. J.A. 1926. And

        finally, we see no abuse of discretion in the district court’s determination that Precision

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        Weather’s “speculative musing that Raymond James could be a possible witness during

        discovery” was in any event too “hypothetical” to mandate recusal. Id. at 1927.

               Though Precision Weather’s argument on this point is not well developed, its main

        contention appears to be that the district court erred by ruling on its motion only after an

        appeal was noticed. It is true that once Precision Weather took an appeal from the dismissal

        of its case, the district court likely would have been divested of authority to adjudicate the

        motion to disqualify. See Doe v. Public Citizen, 749 F.3d 246, 258 (4th Cir. 2014)

        (observing that a timely notice of appeal generally transfers jurisdiction of case to court of

        appeals). Here, however, we understand the district court to have ruled on the motion

        before the notice of appeal, denying that motion implicitly when it did not recuse itself and

        instead dismissed Precision Weather’s case with prejudice. See Hause v. Witkowski,

        98 F.3d 1334, at *1 (4th Cir. 1996) (unpublished table decision) (finding that although the

        district court had not “explicitly ruled” on a recusal motion, its dismissal of the action was

        an “implicit denial” of that motion). Although the court’s explanation for its decision came

        later, in other words, the court’s adjudication of the recusal motion came before the

        divestiture rule shifted authority to this court. See United States v. Jenkins, 22 F.4th 162,

        168 n.5 (4th Cir. 2021) (divestiture rule does not apply where district court decides matter

        before notice of appeal but dockets explanatory order after appeal).

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                                                  III.

              For the foregoing reasons, we affirm the judgment of the district court.

                                                                                     AFFIRMED

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