Daniel Neelon v. Stan Bharti

FILED
NOT FOR PUBLICATION DEC 26 2014
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
DANIEL P. NEELON, No. 12-56958
Plaintiff - Appellant, D.C. No. 2:12-cv-00874-R-MAN
v.
MEMORANDUM*
STAN BHARTI; BLAIR KRUEGER;
FORBES & MANHATTAN, INC.;
DESERT EAGLE RESOURCES, LTD.,
DBA Garrison International, Ltd.,
Defendants - Appellees.
Appeal from the United States District Court
for the Central District of California
Manuel L. Real, District Judge, Presiding
Argued and Submitted December 9, 2014
Pasadena, California
Before: WARDLAW and BERZON, Circuit Judges, and SMITH, District Judge.**
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
** The Honorable William E. Smith, Chief United States District Judge
for the District Rhode Island, sitting by designation.
Daniel P. Neelon (“Neelon”) appeals the district court’s dismissal, on forum
non conveniens grounds, of his claims against Stan Bharti (“Bharti”) and Forbes &
Manhattan, Inc. (collectively, “Defendants”). We reverse. Because the parties are
familiar with the factual and procedural history of this case, it is unnecessary to
recount it here.
Neelon argues that the district court abused its discretion by failing to accord
Neelon’s forum choice proper deference, failing to consider the relevant private
and public interest factors, and striking an unreasonable balance of the factors that
were considered.1 We agree.
The district court offered the following consideration of the private and
public interest factors:
The key witnesses for plaintiff and defendants are located in
Mongolia and Canada. In addition, most documentary evidence will
have to be collected and shipped from these countries.
Further, most, if not all, of the allegedly defamatory statements
were made and disseminated from Canada.
On balance, the public and private interest factors weigh in
favor of the Court granting dismissal for forum non conveniens.
The district court failed to consider several relevant factors.
1
Neelon does not challenge the district court’s determination that Canada
provides an adequate alternative forum for his claims. Accordingly, we do not
address this aspect of the district court’s ruling.
2
First, and most important, the district court failed to consider the residence
of the parties. Although Neelon, a Massachusetts resident, resides outside of the
forum, he is a United States citizen. “‘[W]here the plaintiff is a United States
citizen, the defendant must satisfy a heavy burden of proof,’” Boston Telecomms.
Grp., Inc. v. Wood, 588 F.3d 1201, 1207 (9th Cir. 2009) (quoting Lueck v.
Sundstrand Corp., 236 F.3d 1137, 1143 (9th Cir. 2001)), and, “‘unless the balance
is strongly in favor of the defendant, the plaintiff’s choice of forum should rarely
be disturbed,’” id. (quoting Gates Learjet Corp. v. Jensen, 743 F.2d 1325, 1334-35
(9th Cir. 1984)).2 The district court did not weigh Neelon’s residency or consider
the deference due Neelon’s chosen forum.
2
At oral argument, Defendants argued that this principle from Boston
Telecomms. Grp., Inc. v. Wood, 588 F.3d 1201, 1207 (9th Cir. 2009), applies only
in cases where the forum has ties to the claims asserted in the litigation; citing
Lueck v. Sundstrand Corp., 236 F.3d 1137 (9th Cir. 2001), and In re Air Crash
Over Taiwan Straits on May 25, 2002, 331 F. Supp. 2d 1176 (C.D. Cal. 2004),
Defendants suggested that these cases hold that the forum choice of a United States
citizen who is not a forum resident is not entitled to much deference where there is
no connection between the forum and the underlying facts of the case. This
argument is meritless. Nothing in Boston Telecomms. limits the deference that
must be accorded the forum choice of a United States citizen who is not a forum
resident in the manner suggested by Defendants. Moreover, in Lueck, 236 F.3d at
1140, all of the plaintiffs were citizens of New Zealand, and in In re Air Crash
Over Taiwan Straits, 331 F. Supp. 2d at 1190, the “vast majority” of the plaintiffs
were not United States citizens.
3
Second, the district court failed to consider the forum’s convenience to the
litigants, a private interest factor for which Defendants provided the district court
no evidence. Although Bharti executed a brief declaration, it contained no
allegation that litigation in California would be inconvenient for Defendants.
Defendants’ only effort to address convenience—both before the district court and
on appeal—consisted of arguing that Neelon had failed to show that litigation in
California would be convenient and that it would be inconvenient to litigate in
Canada or Mongolia. Defendants misapprehend the identity of the party bearing
the burden in the forum non conveniens inquiry. “[A] plaintiff need not select the
optimal forum for his claim, but only a forum that is not so oppressive and
vexatious to the defendant ‘as to be out of proportion to plaintiff’s convenience.’”
Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1180 (9th Cir. 2006)
(quoting Ravelo Monegro v. Rosa, 211 F.3d 509, 514 (9th Cir. 2000)). Defendants
made no effort to shoulder their burden of showing oppressive and vexatious
inconvenience in litigating in California.
Finally, the district court failed to explicitly consider any of the public
interest factors, and, in any event, none of them appears to strongly favor
dismissal.
4
In addition to the district court’s failure to consider relevant factors, the
district court made several errors in weighing the factors that it did consider. First
and foremost, the district court erred by focusing solely on the location of the
witnesses. “[T]he focus for this private interest analysis should not rest on the
number of witnesses . . . in each locale but rather the court should evaluate the
materiality and importance of the anticipated . . . witnesses’ testimony and then
determine their accessibility and convenience to the forum.” Carijano v. Occidental
Petroleum Corp., 643 F.3d 1216, 1231 (9th Cir. 2011), cert. denied, 133 S.Ct. 1996(2013) (quoting Boston Telecomms., 588 F.3d at 1209) (internal quotation marks
omitted). The district court failed to perform the required analysis, and Defendants
failed to provide enough information to do so. Defendants only provided a list of
witnesses who resided in either Canada or Mongolia. This showing was
insufficient to carry Defendants’ burden. See Carijano, 643 F.3d at 1231; Boston
Telecomms., 588 F.3d at 1210.
Additionally, the district court’s determination that “most documentary
evidence will have to be collected and shipped from” Canada or Mongolia is not
supported by any evidence in the record. Defendants provided no evidence to the
district court regarding the location of any documentary evidence. The only
evidence in the record regarding the location of documents cuts the other way:
5
Neelon asserted in his declaration that he possessed several key documents that
readily demonstrate the falsity of the alleged defamatory statements made by
Defendants. By disregarding the only record evidence on the location of
documentary evidence and making a factual finding regarding the location of the
documentary evidence not supported by the record, the district court abused its
discretion in weighing the evidence. See Carijano, 643 F.3d at 1224 (explaining
that district court abuses its discretion when it relies on a clearly erroneous
assessment of the evidence).
A district court abuses its discretion in the forum non conveniens context
“when it fails to hold a party to its ‘burden of making a clear showing of facts
which establish such oppression and vexation of a defendant as to be out of
proportion to plaintiff’s convenience,’ or when it ‘fail[s] to consider relevant
private and public interest factors and misconstrue[s] others.’” Carijano, 643 F.3d
at 1236 (citations omitted) (quoting Boston Telecomms., 588 F.3d at 1212; Gates
Learjet, 743 F.2d at 1337). The district court in this case committed these errors
with the result that it applied the “‘exceptional tool’” of a forum non conveniens
dismissal in a case in which the defendants wholly failed to justify such “a drastic
exercise of the court’s ‘inherent power.’” Id. at 1224 (quoting Dole Food Co. v.
Watts, 303 F.3d 1104, 1118 (9th Cir. 2002)). Accordingly, we reverse the order of
6
the district court. The record makes abundantly clear that this case should be
litigated in the district where it was filed.
REVERSED AND REMANDED.
7