Freedman v. Suntrust Banks, Inc.

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
SHANA FREEDMAN,
on behalf of herself and all others similarly
situated,
Plaintiff
Civil Action No. 1:14-cv-01575 (CKK)
v.
SUNTRUST BANKS, INC.
and
SUNTRUST MORTGAGE, INC.,
Defendants
MEMORANDUM OPINION
(September 21, 2015)
Presently before the Court is Defendants’ [14] Motion to Dismiss For Lack of Personal
Jurisdiction and Plaintiff’s [24] Motion for Leave to File Limited Surreply. Upon consideration
of the pleadings, 1 the relevant legal authorities, and the record as a whole, the Court DENIES
Defendants’ Motion to Dismiss and DENIES Plaintiff’s Motion for Leave to File Limited
Surreply. For the reasons described herein, the Court finds that it lacks personal jurisdiction over
Defendants and that jurisdictional discovery is not warranted but that it is in the interest of justice
1
In deciding Defendants’ Motion to Dismiss, the Court’s consideration has focused on the
following pleadings: Pl.’s Complaint (“Compl.”), ECF No. [1]; Defs.’ Mot. to Dismiss (“Defs.’
Mot.”), ECF No. [14]; Pl.’s Mem. in Opp’n to Defs.’ Mot. to Dismiss (“Pl.’s Opp’n”), ECF No.
[21]; and Defs.’ Reply Mem. in Further Supp. of its Mot. to Dismiss (“Defs.’ Reply”), ECF No.
[23]. In deciding Plaintiff’s Motion for Leave to File Limited Surreply, the Court also
considered the following pleadings: Pl.’s Mot. for Leave to File Limited Surreply, ECF No. [24],
Defs.’ Mem. in Opp’n to Pl.’s Mot. for Leave to File Limited Surreply, ECF No. [25], and Pl.’s
Reply to Defs.’s Opp’n to Pl.’s Mot. for Leave to File Limited Surreply, ECF No. [26]. In an
exercise of its discretion, the Court finds that holding oral argument in this action would not be
of assistance in rendering a decision. See LCvR 7(f).
1
to transfer the matter to the U.S. District Court for the Middle District of Florida pursuant to 28
U.S.C. § 1406(a) and 28 U.S.C. § 1631.
I. BACKGROUND
For the purposes of the motion before the Court, the Court accepts as true the well-
pleaded allegations in Plaintiff’s Complaint. The Court does “not accept as true, however, the
plaintiff’s legal conclusions or inferences that are unsupported by the facts alleged.” Ralls Corp.
v. Comm. on Foreign Inv. in U.S., 758 F.3d 296, 315 (D.C. Cir. 2014). The Court recites the
principal facts pertaining to the issues raised in the pending motions, reserving further
presentation of the facts for the discussion of the individual issues below.
Plaintiff Shana Freedman (“Plaintiff”) is a Florida resident who unsuccessfully sought a
home loan from SunTrust Mortgage (“SunTrust”) in the fall of 2012. Compl. ¶ 3, 17, 40.
Plaintiff, whose income consists of long-term Social Security Disability Insurance (“SSDI”), was
ultimately unable to submit a loan application for processing due to a SunTrust policy requiring
her to provide firm assurances that her disability benefits would continue. Id. ¶ 37. Plaintiff first
experienced difficulties obtaining a home loan from SunTrust in October 2012 when she
attempted to complete an online loan application that did not permit her to indicate income in the
form of SSDI payments. Id. ¶ 26. Plaintiff contacted a SunTrust loan officer to seek assistance
with the application, explaining that she was disabled and that her income consisted of SSDI
payments. Id. ¶ 26. Plaintiff also faxed the loan officer her most recent SSDI award letter,
which had no expiration date for her long-term disability benefits. Id. ¶ 31. Following
consultation with SunTrust’s underwriting department, the loan officer informed Plaintiff that
SunTrust had a policy requiring loan applicants whose income consisted of long-term disability
benefits to submit documentation “from a Doctor or from Social Security” indicating that “the
2
income is going to continue.” Id. ¶ 33. Plaintiff could not provide the requested documentation
from the Social Security Administration because that agency does not guarantee future benefits.
Id. ¶ 35. Because Plaintiff was unable to obtain the requested documentation, SunTrust refused
to process her loan application. Id. ¶ 37. When Plaintiff contacted SunTrust one month later, the
loan officer confirmed that SunTrust’s income-verification policy continued. Id. In accordance
with this policy, SunTrust again refused to process Plaintiff’s application. Id. ¶ 37. On
September 16, 2014, Plaintiff filed this lawsuit as a putative class action on behalf of herself and
other similarly situated borrowers whose income derives from long-term disability assistance.
Id. ¶ 41. Plaintiff alleges that SunTrust’s policy of requesting sensitive medical information
regarding an applicant’s disability violates the Fair Housing Act, 42 U.S.C. § 3601 et seq., and
the Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. § 1691 et seq. Id. ¶ 42-43.
The defendants in this action are SunTrust Banks Inc. and SunTrust Mortgage, Inc.
(“Defendants”). SunTrust Banks, Inc. is an American bank holding company. Compl. ¶ 12. It is
a Georgia corporation with its principal place of business at 303 Peachtree Street NE, Atlanta,
Georgia, 30308. Defs.’ Mot. Exhibit A. 2 SunTrust Banks, Inc. is one of the largest financial
services organization in the United States, operating 1,700 banks throughout the United States,
including in the District of Columbia. Compl. ¶ 12. SunTrust Banks, Inc. operates a number of
retail bank branches in the District of Columbia and maintains a mortgage office in the District.
Id. Defs.’ Mot. Exhibit B. SunTrust Bank, Inc.’s website advertises that SunTrust Bank and its
2
The Court considers Defendants’ and Plaintiff’s Exhibits as matters of public record. See Covad
Commc’ns. Co. v. Bell Atl. Corp., 407 F.3d 1220, 1222 (D.C. Cir. 2005). In addition, “unlike a motion to
dismiss for failure to state a claim, the Court need not confine itself to only the allegations in the
complaint, but ‘may consider materials outside the pleadings in deciding whether to grant a motion to
dismiss for lack of jurisdiction.’ ” Frost v. Catholic Univ. of Am., 960 F. Supp. 2d 226, 231 (D.D.C. 2013)
aff'd, 555 F. App'x 6 (D.C. Cir. 2014) (quoting Jerome Stevens Pharms., Inc. v. FDA, 402 F.3d 1249,
1253 (D.C. Cir. 2005)).
3
affiliates offer retail and mortgage banking services “primarily in Florida, Georgia, Maryland,
North Carolina, South Carolina, Tennessee, Virginia, and the District of Columbia.” Pl.’s Opp’n
Exhibit A.
SunTrust Mortgage, Inc. is a wholly-owned subsidiary of Defendant SunTrust Banks,
Inc.. Id. ¶ 13. SunTrust Mortgage, Inc. is a Virginia Corporation with its principal place of
business at 901 Semmes Avenue, Richmond, Virginia 23224. Defs.’ Mot. Exhibit B. SunTrust
Mortgage, Inc. operates loans in SunTrust markets throughout the South and mid-Atlantic
regions of the Unites States, including the District of Columbia. Compl. ¶ 13. It services loans
in approximately 48 states and the District of Columbia. Id. In 2013, SunTrust Mortgage was
ranked number eight in mortgage originations in the United States. Id. Plaintiff alleges that
SunTrust Mortgage, Inc. “is and at all relevant times has been a subsidiary of, controlled by, a
mere instrumentality of, and an agent of SunTrust Banks such that SunTrust Banks is liable for
its acts alleged herein.” Id. ¶ 13.
On February 17, 2015, Defendants filed a Motion to Dismiss for Lack of Personal
Jurisdiction. On April 2, 2015, Plaintiff filed her Opposition to Defendant’s Motion, requesting
in the alternative that the Court transfer the case to the Middle District of Florida. After
Defendants filed their Reply brief on April 27, 2015, Plaintiff filed a motion on May 6, 2015 for
leave to file a surreply to bolster arguments in support of the transfer request previously made in
her Opposition brief. Defendants’ Reply brief did nothing more than respond to Plaintiff’s
arguments in support of her transfer request. Because Defendants did not raise any new
arguments in their Reply brief, the Court denies Plaintiff’s motion for leave to file a surreply.
Crummey v. Soc. Sec. Admin., 794 F. Supp. 2d 46, 63 (D.D.C. 2011) aff'd, No. 11-5231, 2012 WL
4
556317 (D.C. Cir. Feb. 6, 2012) (“[A] surreply is not a vehicle for rehashing arguments that have
already been raised and briefed by the parties.”).
II. LEGAL STANDARD
When personal jurisdiction is challenged under Rule 12(b)(2), the plaintiff bears the
burden of establishing a factual basis for asserting personal jurisdiction over a defendant. See
Crane v. N.Y. Zoological Soc'y, 894 F.2d 454, 456 (D.C. Cir. 1990). At this stage, the plaintiff
“can satisfy that burden with a prima facie showing.” Mwani v. bin Laden, 417 F.3d 1, 7 (D.C.
Cir. 2005) (quoting Edmond v. United States Postal Serv. Gen. Counsel, 949 F.2d 415, 424 (D.C.
Cir. 1991)) (emphasis in original). To do so, the plaintiff cannot rest on bare allegations or
conclusory statements but “must allege specific acts connecting [the] defendant with the forum.”
Second Amendment Found. v. U.S. Conference of Mayors, 274 F.3d 521, 524 (D.C. Cir. 2001)
(internal quotation marks omitted). “To make such a showing, the plaintiff is not required to
adduce evidence that meets the standards of admissibility reserved for summary judgment and
trial[;]” but rather, the plaintiff may “rest her arguments on the pleadings, ‘bolstered by such
affidavits and other written materials as [she] can otherwise obtain.’ ” Urban Inst. v. FINCON
Servs., 681 F.Supp.2d 41, 44 (D.D.C. 2010) (quoting Mwani, 417 F.3d at 7).
In order to obtain jurisdictional discovery a “plaintiff must have at least a good faith
belief that such discovery will enable it to show that the court has personal jurisdiction over the
defendant.” Caribbean Broad. Sys. Ltd. v. Cable & Wireless PLC, 148 F.3d 1080, 1090 (D.C.
Cir. 1998); see also Exponential Biotherapies, Inc. v. Houthoff Buruma N.V., 638 F. Supp. 2d 1,
11 (D.D.C. 2009) (holding that [j]urisdictional discovery ... is justified only if the plaintiff
reasonably ‘demonstrates that it can supplement its jurisdictional allegations through discovery.’
”) (quoting Kopff v. Battaglia, 425 F. Supp. 2d 76, 89 (D.D.C. 2006)). “Mere conjecture or
5
speculation” is not enough to justify jurisdictional discovery. FC Investment Group LC v. IFX
Markets Ltd., 529 F.3d 1087, 1094 (D.C. Cir. 2008).
Pursuant to 28 U.S.C. § 1406, courts have authority to transfer a case “laying venue in the
wrong division or district” to “any district or division in which it could have been brought,” if
such a transfer would be “in the interest of justice.” The decision whether a transfer under
Section 1406 is in the “interest of justice” rests “within the sound discretion of the district court.”
Naartex Consulting Corp. v. Watt, 722 F.2d 779, 789 (D.C. Cir. 1983). Transfer is appropriate
“when procedural obstacles [such as lack of personal jurisdiction, improper venue, and statute-
of-limitations bars] impede an expeditious and orderly adjudication on the merits.” Sinclair v.
Kleindienst, 711 F.2d 291, 293–94 (D.C. Cir. 1983). Generally, the interests of justice require
transferring a case to the appropriate judicial district rather than dismissing it. See Goldlawr, Inc.
v. Heiman, 369 U.S. 463, 466–67 (1962).
Courts also have authority under 28 U.S.C. § 1631 to transfer a case filed in the wrong
jurisdiction, “if it is in the interest of justice” to do so. When a case is transferred pursuant to 28
U.S.C. § 1631, it “proceed[s] as if it had been filed in . . . the court to which it is transferred on
the date upon which it was actually filed in ... the court from which it is transferred.” Id. “There
are three elements to a section 1631 transfer: (1) there must be a lack of jurisdiction in the district
court; (2) the transfer must be in the interest of justice; and (3) the transfer can be made only to a
court in which the action could have been brought at the time it was filed or noticed.” Fasolyak
v. The Cradle Soc'y, Inc., No. 06–1126, 2007 WL 2071644, at *11 (D.D.C. July 19, 2007)
(quoting Ukiah Adventist Hosp. v. FTC, 981 F.2d 543, 549 (D.C. Cir. 1992)). As the party
requesting transfer, Plaintiff bears the burden of establishing that the elements of a § 1631
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transfer have been met. See Osage Tribe of Indians of Okla. v. U.S., No. 04–283, 2005 WL
578171, at *2 (D.D.C. Mar. 9, 2005).
III. DISCUSSION
Defendants move to dismiss this action under Rule 12(b)(2) for lack of personal
jurisdiction, arguing that it has insufficient contacts with the District of Columbia to support
jurisdiction. Plaintiff opposes Defendants’ motion and requests in the alternative that the Court
permit jurisdictional discovery or transfer the case to the U.S. District Court for the Middle
District of Florida pursuant to 28 U.S.C. § 1406, or in the alternative, to 28 U.S.C. § 1631.
The Court finds that there is not jurisdiction over Defendants and that jurisdictional
discovery is not warranted. The Court further finds that it is in the interest of justice to transfer
the matter to the U.S. District Court for the Middle District of Florida, which is a competent
jurisdiction to hear Plaintiff’s claims, pursuant to either 28 U.S.C. § 1406 or 28 U.S.C. § 1631.
A. The Court Lacks Personal Jurisdiction over Defendants
Defendant moves to dismiss this action under Rule 12(b)(2) for lack of personal
jurisdiction, arguing that they have insufficient contacts with the District of Columbia to support
jurisdiction. See Defs.’ Mot. at 7-9. Plaintiff argues that the District of Columbia has general
personal jurisdiction over Defendants because of their “continuous and systematic affiliations
with the forum state.” Pl.’s Mot. at 9. Plaintiff is “not aware of facts indicating that her claims
arose in the District of Columbia, and she therefore does not attempt to establish specific
jurisdiction.” Pl.’s Mot. at 1.
7
a. The Court’s Analysis is Governed by the Supreme Court’s decision in Daimler
AG v. Bauman
Under District of Columbia law, courts may exercise general jurisdiction over foreign
corporations such as Defendants when they are “doing business” in the District of Columbia.
D.C. Code § 13–334(a). 3 The scope of the phrase “doing business” as used in the D.C. Code is
“coextensive with the reach of constitutional due process.” Gorman v. Ameritrade Holding
Corp., 293 F.3d 506, 510 (D.C. Cir. 2002). Constitutional due process permits a court to
exercise general jurisdiction over a foreign corporation only “when the corporation’s affiliations
with the State in which suit is brought are so constant and pervasive ‘as to render [it] essentially
at home in the forum state.’ ” Daimler AG v. Bauman, ––– U.S. ––––, 134 S. Ct. 746, 751, 187
L.Ed.2d 624 (2014) (quoting Goodyear Dunlop Tire Operations, S.A. v. Brown, ––– U.S. ––––,
131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011)); see also Goodyear, 131 S. Ct. at 2853 (quoting
International Shoe v. Washington, 326 U.S. 310, 318 (1945) (General jurisdiction consists of
“instances in which the continuous corporate operations within a state [are] so substantial and of
such a nature as to justify suit against it on causes of action arising from dealings entirely distinct
from those activities.”).
In Daimler, the Court addressed whether the contacts of Mercedes Benz USA, Inc.
(“MBUSA”) within the state of California were sufficient to allow a California federal court to
exercise personal jurisdiction over MBUSA’s parent company. 134 S. Ct. at 746. MBUSA had
multiple California-based facilities, including a regional office, a vehicle preparation center, and
a “classic car” center. Id. at 752. MBUSA was also the largest supplier of luxury vehicles to
3
Defendants are considered “foreign” corporations because they are not “domiciled in, organized
under the laws of, or maintaining . . . [their] principal place of business in, the District of
Columbia.” D.C. Code § 13–422.
8
the California market. Id. MBUSA’s extensive contacts, however, were not sufficient to
conclude that California could exercise general jurisdiction over MBUSA’s parent company. 4
The Court emphasized that a corporation is not “at home” in “every state in which it engages in a
substantial, continuous, and systematic course of business[.]” Id. at 760-61. The Court
characterized such an approach as “unacceptably grasping.” Id. at 761. Rather, general
jurisdiction “calls for an appraisal of a corporation’s activities in their entirety, nationwide and
worldwide.” Id. at 762. n.20. “A corporation that operates in many places,” observed the
Supreme Court, “can scarcely be deemed at home in all of them.” Id. “With respect to a
corporation, the place of incorporation and principal place of business are ‘paradig[m] . . . bases
for general jurisdiction.’ ” Id. at 761 (quoting Goodyear, 131 S. Ct. at 2856). The Supreme
Court also noted that “in an exceptional case, a corporation's operations in a forum other than its
formal place of incorporation or principal place of business may be so substantial and of such a
nature as to render the corporation at home in that State.” Id. at 761 n.19 (citing Perkins v.
Benguet Consol. Mining Co., 342 U.S. 437 (1952) (holding that general jurisdiction over a
Philippines corporation was proper in Ohio after it moved its headquarters to the state after the
Japanese occupied the Philippines in World War II)).
4
In Daimler, the Supreme Court imputed MBUSA’s contacts to its parent company, Daimler,
and concluded that there “would still be no basis to subject Daimler to general jurisdiction in
California.” 134 S. Ct. at 760. The Court was unable to make a similar holding as to MBUSA
because Daimler “failed to object below to plaintiffs’ assertion that the California courts could
exercise all-purpose jurisdiction over MBUSA.” Id. at 758. Because Daimler procedurally
waived the argument, the Supreme Court assumed for the purposes of that decision that MBUSA
was “at home” in California. Id. That assumption did not alter the rest of the Court’s analysis.
9
b. The Court Cannot Exercise General Personal Jurisdiction over Defendants
Plaintiff argues that Defendants’ contacts with the District of Columbia are “so
continuous and systematic” as to render them “essentially at home” in the District of Columbia.
Pl.’s Mot. at 9. 5 Plaintiff argues that Defendants have established a “robust and permanent
presence in the District,” maintaining a physical business office, as well as mortgage branches at
which they originate loans and carry out other mortgage lender functions. Id. at 15. Defendants
are also registered to do business in the District and maintain an agent for service of process
here. Id. Plaintiff argues that Defendants’ “brick-and-mortar presence” in the District is
sufficient under Goodyear and Daimler. Id. at 1. Goodyear and Daimler, according to Plaintiff,
“simply clarify that general jurisdiction requires actual ‘presence’ within the forum.” Id. at 14.
The Court disagrees with Plaintiff’s reading of these cases, and concludes that Defendants are
not “essentially at home” in the District of Columbia.
In Daimler, the Supreme Court held that “[w]ith respect to a corporation, the place of
incorporation and principal place of business are ‘paradig[m] . . . bases for general jurisdiction.’ ”
134 S. Ct. at 760 (quoting Goodyear, 131 S. Ct. at 2856). Here, SunTrust Banks, Inc. is a
Georgia corporation with its principal place of business in Georgia, and SunTrust Mortgage, Inc.
is a Virginia corporation with its principal place of business in Virginia. Defs.’ Mot. Exhibits A
& B. Therefore, the “paradigm bases for general jurisdiction” over Defendants would be
Georgia and Virginia. Defendants could also be subject to general jurisdiction in a forum other
than Georgia and Virginia, but Defendants’ contacts with that forum must be “so substantial and
5
The Court finds it unnecessary to treat separately the contacts of SunTrust Mortgage, Inc. and
the contacts of its parent company, SunTrust Bank, Inc. Even if the Court were to assume an
“agency” relationship between SunTrust Mortgage, Inc. and SunTrust Bank, Inc., their collective
contacts would not be “so constant and pervasive” ‘as to render the Defendants “essentially at
home” in the District of Columbia. See Daimler, 134 S. Ct. at 751.
10
of such a nature as to render the corporation at home in that State.” Daimler, 134 S. Ct. at 760
n.19 (emphasis added). Plaintiff, however, has not shown, nor argued, that Defendants are any
more “at home” in the District of Columbia than they are “at home” in the other states where
Defendants maintain “substantial, continuous, and extensive business contacts.” By Plaintiff’s
own admission, Plaintiff’s argument “potentially subjects” Defendants to general jurisdiction in
each of Defendants’ eight “primary bases of operation.” See Pl.’s Reply at 3, 16. In each of
these eight “primary bases”—the District of Columbia, Florida, Georgia, Maryland, North
Carolina, South Carolina, Tennessee, and Virginia—Defendants operate numerous retail
branches and ATMs, and maintain a significant “brick-and-mortar” presence. See Pl. Exhibit A.
Plaintiff’s argument for general personal jurisdiction in the District of Columbia would therefore
render Defendants “at home” in eight different jurisdictions encompassing much of the eastern
seaboard. See id. The Supreme Court’s decision in Daimler explicitly forecloses such an
outcome. See 134 S. Ct. at 761-62. In Daimler, the Supreme Court held that if the defendant’s
California activities—which included extensive retail sales and a substantial “brick-and-mortar”
presence—“sufficed to allow adjudication of” claims unrelated to the state of California, the
same reach would “presumably be available in every State in which [the Defendant’s] sales are
sizeable.” Id. at 761. As the Court observed, a “corporation that operates in many places can
scarcely be deemed at home in all of them.” Id. at 762 n.10.
Plaintiff argues that there is general jurisdiction over Defendants under Gorman. See
Pl.’s Reply at 22. Gorman, however, was decided prior to Goodyear and Daimler, and the
applicable test for jurisdiction under the Due Process Clause was whether the defendant’s
contacts with the District were merely “continuous and systematic.” See 293 F.3d at 512 (“[T]he
test that we will apply to determine whether the District has general jurisdiction in this case is the
11
traditional one: Were [defendant]’s contacts with the District ‘continuous and systematic.’ ”).
After Goodyear and Daimler, the appropriate inquiry is “not whether a foreign corporation’s in-
forum contacts can be said to be in some sense ‘continuous and systematic,’ it is whether that
corporation’s affiliations with the State are so ‘continuous and systematic’ as to render [it]
essentially at home in the forum State.” 134 S. Ct. at 762 (internal quotations omitted). Even the
cases cited by Plaintiff apply the “essentially at home” test under Daimler/Goodyear, rather than
the “continuous and systematic” test under Gorman. See, e.g., Alkanani v. Aegis Def. Servs.,
LLC, 976 F. Supp. 2d 13, 29 (D.D.C. 2014) appeal dismissed, No. 14-7056, 2014 WL 4628907(D.C. Cir. Aug. 11, 2014). In Alkanani, decided two months after Daimler, the court observed,
“[m]oreover, and perhaps even more significant, the Supreme Court recently emphasized that
‘engaging in a substantial, continuous, and systematic course of business’ in the forum is not, in
and of itself, enough for general jurisdiction to comport with due process.” Id. at 29 (quoting
Daimler, 134 S. Ct. at 757-58). Citing Daimler, the court concluded that the defendant
corporation’s activities in the District of Columbia—which included (1) contract negotiations
and meetings with the U.S. government; (2) a website; (3) tax filings; and (4) contacts with non-
government clients—“did not render the company ‘essentially at home’ ” in the District. Id. at
35. Therefore, even if Defendants’ contacts with the District of Columbia are “continuous and
systematic,” the Court must consider whether these contacts render Defendants “essentially at
home” in the District in light of Defendants’ activities “in their entirety, nationwide and
worldwide.” Daimler, 134 S. Ct. at 762 n.20. When the Court views Defendants’ contacts with
the District of Columbia in light of Defendants’ contacts with their seven other “primary bases of
operation,” the Court cannot conclude that Defendants are “essentially at home” in the District of
Columbia. See id. Accordingly, the Court lacks general jurisdiction over Defendants. See id.12
c. Jurisdictional Discovery is Not Warranted
Plaintiff argues that, if the Court does not find sufficient support for general jurisdiction
in the record, the Court should permit jurisdictional discovery rather than dismissing for lack of
personal jurisdiction. See Pl.’s Opp'n at 23. The Court, however, concludes that jurisdictional
discovery is not warranted. To be granted jurisdictional discovery, “a plaintiff must have at least
a good faith belief that such discovery will enable it to show that the court has personal
jurisdiction over the defendant.” Caribbean Broad. Sys., Ltd., 148 F.3d at 1090. “Mere
conjecture or speculation” is not enough to justify such discovery. FC Investment Group LC,
529 F.3d at 1094.
Plaintiff seeks to conduct discovery relating to “the frequency and volume of Defendants’
banking and mortgage transactions with individuals located in the District of Columbia, the
number of employees Defendants employ in the District of Columbia, and the physical property
Defendants occupy and use here and whether Defendants own or have long-term leases for these
buildings.” See Pl.’s Opp'n at 24. But the Court cannot “see what facts additional discovery
could produce that would affect our jurisdictional analysis.” Mwani, 417 F.3d at 17. At best, the
additional discovery sought by Plaintiff would demonstrate that Defendants engage in a
“substantial, continuous, and systematic course of business” in the District of Columbia, which is
explicitly insufficient under Daimler to establish general jurisdiction. 134. S. Ct. at 760-61
(rejecting plaintiffs’ argument that general jurisdiction over a corporate defendant exists in
“every state in which it engages in a substantial, continuous, and systematic course of business”).
Plaintiff has suggested no way in which additional discovery would yield information enabling
them to show that Defendants are “essentially at home” in the District of Columbia, such as a
situation where Defendants are running a de facto base of operations through the District. See
Perkins, 342 U.S. at 447-49 (finding general jurisdiction over corporation which had moved its
13
headquarters, including its president’s office, to Ohio as part of a principal, if temporary, place of
business); In re Hellas Telecommunications (Luxembourg) II SCA, 524 B.R. 488, 507-08 (Bankr.
S.D.N.Y.) adhered to, 526 B.R. 499 (Bankr. S.D.N.Y. 2015) (finding nationwide jurisdiction
over corporation whose principal location in New York served as its North American Regional
Headquarters, spanned 1.6 million square feet, and employed 1,600 personnel, including 1,000
executives). Because Plaintiff has not “reasonably demonstrated” that jurisdictional discovery
would alter the Court’s conclusions regarding jurisdiction, jurisdictional discovery is not
justified. Exponential Biotherapies, Inc., 638 F.Supp.2d at 11.
B. The Court Shall Transfer this Action to the United States District Court for the Middle
District of Florida in the Interest of Justice
Plaintiff requests that the Court, in lieu of dismissal, transfer the case to the United States
District Court for the Middle District of Florida pursuant to 28 U.S.C. § 1406, or in the
alternative, 28 U.S.C. § 1631. See Pl.’s Opp'n at 26. The Court concludes that it is “in the
interest of justice” under either provision to transfer this case to the Middle District of Florida.
a. Transferring this Action to the United States District Court for the Middle
District of Florida is in the “Interest of Justice” Pursuant to 28 U.S.C. § 1406Plaintiff requests that the Court, in lieu of dismissal, transfer the case to the United States
District Court for the Middle District of Florida pursuant to 28 U.S.C. § 1406. See Pl.’s Opp'n at
26. Section 1406(a) provides that, “[t]he district court of a district in which is filed a case laying
venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer
such case to any district or division in which it could have been brought.” 28 U.S.C. § 1406.
As a preliminary matter, the parties disagree as to whether a court may transfer a case
under Section 1406 in the situation where a defendant has filed a motion to dismiss for lack of
personal jurisdiction, but not a motion to dismiss for improper venue. Plaintiff argues that
14
Section 1406 broadly permits transfer to cure a number of procedural obstacles including the
lack of personal jurisdiction. Pl.’s Opp’n at 26-27. Defendants argue that Section 1406 permits
a transfer only where the defendant has objected to venue. Defs.’ Reply at 15-16. The Court
concludes that Section 1406 permits a transfer where, as here, a defendant has moved to dismiss
for lack of personal jurisdiction—but not for improper venue—and the plaintiff has responded
with a request to transfer, in lieu of dismissal.
1. Section 1406 Permits Transfer, in Lieu of Dismissal, where a Defendant
Has Challenged Personal Jurisdiction, but not Venue
The Supreme Court and the D.C. Circuit have broadly interpreted 28 U.S.C. §1406 to
hold that a district court may transfer a case to a proper venue when transfer would further the
interests of justice by removing procedural obstacles that would otherwise prevent a prompt
adjudication on the merits. In Goldlawr, the Supreme Court held that the language of Section
1406 “is amply broad enough to authorize the transfer of cases, however wrong the plaintiff may
have been in filing his case as to venue, whether the court in which it was filed has personal
jurisdiction over the defendant or not.” 369 U.S. at 466. Section 1406(a) achieves the “general
purpose” of “removing whatever obstacles may impede an expeditious and orderly adjudication
of cases and controversies.” Id. at 466-67. A transfer under Section 1406(a) may remove
“procedural obstacles” such as “the lack of personal jurisdiction, improper venue and statute of
limitations bars.” Sinclair, 711 F.2d at 294 (citing Dubin v. United States, 380 F.2d 813, 816 (5th
Cir. 1967).
Defendants argue that these cases “stand for the proposition that, when a defendant
moves to dismiss for lack of venue, and the court also lacks personal jurisdiction over the
defendant, the court may invoke 28 U.S.C. § 1406 and transfer venue.” Defs.’ Reply at 13
(emphasis in original). The cases, according to Defendants, “do not stand for the idea that a
15
motion to dismiss for lack of personal jurisdiction alone may be met with a venue transfer.”
Defs.’ Reply at 13. Defendants’ position is at odds with the plain reading of the D.C. Circuit’s
opinion in Sinclair and its progeny. In Sinclair, the court did not discuss whether the defendants
filed a motion to dismiss for lack of venue, and it does not state that such a motion is a
prerequisite for a court to invoke 28 U.S.C. § 1406(a). See 711 F.2d. at 292. The case simply
says that the defendants “moved to dismiss the action on various grounds” and that the “plaintiffs
opposed the motions for dismissal and, pursuant to 28 U.S.C. § 1406(a) (1976), moved to have
all three cases transferred. . . .” Id. Several cases, each citing Sinclair, have held that a venue
transfer under 28 U.S.C. § 1406(a) is squarely within the court’s “sound discretion” in the
precise circumstances at issue here—where the defendant is challenging personal jurisdiction,
but not venue. See Atwal v. Myer, 841 F. Supp. 2d 364, 368 (D.D.C. 2012) (transferring case
under 28 U.S.C. § 1406(a) to the Northern District of Texas after resolving defendants’ motion to
dismiss for lack of personal jurisdiction); Capital Bank Int'l Ltd. v. Citigroup, Inc., 276 F. Supp.
2d 72, 78 (D.D.C. 2003) (transferring case under 28 U.S.C. § 1406(a) to the District of Delaware
after plaintiffs requested a transfer, in lieu of dismissal, in their opposition to defendants’ motion
to dismiss for lack of personal jurisdiction). Accordingly, a court may transfer a case under
Section 1406(a) where, as here, the defendant has moved to dismiss for lack of personal
jurisdiction, and the plaintiff has responded with a request to transfer, in lieu of dismissal. See
Sinclair, 711 F.2d. at 292; Citigroup, 276 F. Supp. 2d at 72.
2. It is in the “Interest of Justice” under 28 U.S.C. § 1406(a) to Transfer this
Case to a Proper Venue
Section 1406(a) provides that, “[t]he district court of a district in which is filed a case
laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice,
transfer such case to any district or division in which it could have been brought.” 28 U.S.C.
16
§ 1406. Accordingly, in order to transfer an action under Section 1406, the transferor court must
find that (1) the transferor court is a “wrong” venue, (2) the case “could have been brought” in
the transferee court, and (3) transfer to the transferee court would be “in the interest of justice.”
See id. The Court finds that all three elements are met in this case.
i. The District of Columbia is a “Wrong” Venue
Defendants argue that venue cannot be “wrong” in this case because Defendants have not
moved to dismiss for lack of venue, and thereby, they have waived any objections to venue. See
Defs.’ Reply at 14. Whether venue is “wrong” under Section 1406(a), however, “depends
exclusively on whether the court in which the case was brought satisfies the requirements of
federal venue laws.” Atl. Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas, 134 S. Ct.
568, 577 (2013). The applicable “federal venue law” in this case, 28 U.S.C. § 1391(b), 6 states
that “[a] civil action may be brought in—(1) a judicial district in which any defendant resides, if
all defendants are residents of the State in which the district is located; (2) a judicial district in
which a substantial part of the events or omissions giving rise to the claim occurred, or a
substantial part of property that is the subject of the action is situated; or (3) if there is no district
in which an action may otherwise be brought as provided in this section, any judicial district in
which any defendant is subject to the court's personal jurisdiction with respect to such action.”
28 U.S.C. § 1391(b). A corporate defendant is deemed to reside in “any district in which it is
subject to personal jurisdiction at the time the action is commenced.” 28 U.S.C. § 1391(c).
Here, Defendants do not “reside” in the District of Colombia for purposes of § 1391(b)(1)
because they are corporations that are not subject to personal jurisdiction in the District of
6
Section 1391 governs “venue generally,” that is, in cases where a more specific venue provision
does not apply. Cf., e.g., 28 U.S.C. § 1400 (identifying proper venue for copyright and patent
suits).
17
Columbia. See Part III.A, supra. A “substantial part of the events” giving rise to the claims in
this action did not occur in the District of Columbia under § 1391(b)(2). See Compl. ¶ 18-41.
As to 1391(b)(3), there is another district in which the action may be brought, i.e., the Middle
District of Florida. See Part III.B.a.2.ii, infra. Therefore, the District of Columbia is a “wrong”
venue under 28 U.S.C. § 1391.
ii. This Case Could Have Been Brought in the Middle District of
Florida
Plaintiff alleges, and Defendants do not dispute, that venue and personal jurisdiction
would lie in the Middle District of Florida. Florida Statutes Section 48.193 provides for specific
personal jurisdiction—i.e., based on claims arising in Florida—over defendants “operating,
conducting, engaging in, or carrying on a business . . . in this state or having an office or agency
in this state” or “committing a tortious act within this state.” Fla. Stat. Ann. § 48.193(1)(a)(1)-
(2). Defendants are registered to conduct business in Florida, and they are alleged to have
committed a tortious act in the Middle District of Florida by allegedly subjecting Plaintiff to
discriminatory lending policies. Pl.’s Opp’n at 27. For the same reasons, venue lies in the
Middle District of Florida, Orlando Division. See 28 U.S.C. § 1391(a), 1391(b)(2). 7
iii. A Transfer to the Middle District of Florida Would be in the
“Interest of Justice”
Plaintiff argues that transfer would further the “interest of justice” because Plaintiff’s
claims under the Fair Housing Act, 42 U.S.C. § 3604(c), 3604(f)(1), 3604(f)(2), and 3605 would
be time barred if Plaintiff is required to refile their case in a new jurisdiction. See Pl.’s Opp’n at
7
Plaintiff’s property is located in Volusia County, and the SunTrust Mortgage officer with whom
she interacted is based in Seminole County. Both Counties fall in the Middle District, Orlando
Division. Pl.’s Opp’n at 27 n. 12.
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27-28. Plaintiff’s claims under the Fair Housing Act are subject to a two-year limitations period,
which, without equitable tolling or the application of the continuing violations doctrine, would
be time barred if Plaintiff had to refile. See 42 U.S.C. § 3613(a). Defendants do not dispute that
Plaintiff’s Fair Housing Act claims would be time barred. Rather, Defendants argue that transfer
would not be in the “interest of justice” because Plaintiff “knew, or should have known, that
[she] filed suit in the wrong jurisdiction.” Defs.’ Reply at 16.
According to the D.C. Circuit, transfer is in the “interest of justice” where “without a
transfer the cause of action would be barred by the running of the applicable statute of
limitations.” Sinclair, 711 F.2d at 294 (citing Burnett v. New York Central Railroad Co., 380
U.S. 424, 430 (1965)); see also Ebron v. Dep’t of the Army, 766 F. Supp. 2d 54, 58-59 (D.D.C.
2011) (transferring case under § 1406 where dismissal would preclude plaintiff from refiling);
Williams v. GEICO Corp., 792 F. Supp. 2d 58, 64 (D.D.C. 2011) (same). Transfer is also in the
“interest of justice” where transfer would save the parties the time and expense associated with
refiling, see, e.g., Capital Bank, 276 F. Supp. 2d at 78, and where transfer would not prejudice
the defendant, see, e.g., Delta Sigma Theta Sorority Inc. v. Bivins, 20 F. Supp. 3d 207, 219
(D.D.C. 2014).
Defendants, who concede that Plaintiff’s claims may be time barred if the case is not
transferred, argue that transfer is not “in the interest of justice” because Plaintiff “knew or should
have known that [she] filed suit in the wrong jurisdiction.” See Defs.’ Reply at 16. Defendants
cite McFarlane v. Esquire Magazine, 74 F.3d 1296, 1301 (D.C. Cir. 1996), in which the D.C.
Circuit held that the district court did not abuse its discretion by denying a motion to transfer
where the statute of limitations governing the claim had expired. Id. In McFarlane, the district
court found that it lacked personal jurisdiction over a co-defendant who was a resident of New
19
York. Id. The district court denied the plaintiffs’ motion to transfer, in lieu of dismissal, holding
that the plaintiffs were “put on notice” by the defendant’s answer that the District of Columbia
lacked personal jurisdiction over the defendant. Id. The district court concluded that plaintiffs
would not be prejudiced by the denial because they could still seek recovery against the
remaining defendants in the District of Columbia. Id. The court also found that a transfer was
not “in the interest of justice” because the District of Columbia was “the nexus of the alleged
injury and activities described in the statements at issue.” McFarlane v. Esquire Magazine, No.
CIV. 92-0711 TAF, 1994 WL 510088, at *7 (D.D.C. June 8, 1994) aff'd, 74 F.3d 1296 (D.C. Cir.
1996).
The circumstances of this case are distinguishable from the facts of McFarlane. First,
Plaintiff, unlike the plaintiff in McFarlane, would be prejudiced if the case is not transferred
because she would no longer be able to seek any recovery on her Fair Housing Act claims. See
Sinclair, 711 F.2d at 294; Ebron, 766 F. Supp. 2d at 58-59; Williams, 792 F. Supp. 2d at 64.
Second, unlike the plaintiff in McFarlane, Plaintiff here is suing corporate defendants.
Plaintiff’s situation is similar to that of the plaintiff in Goldlawr, who filed suit against corporate
defendants in a state where the plaintiff believed the corporation “transact[ed] business” and
therefore was subject to the court’s jurisdiction. 369 U.S. at 466. In Goldlawr, the statute of
limitations governing the plaintiff’s claim expired, and the Supreme Court concluded that a
transfer was in the “interest of justice,” recognizing the “difficulties which may arise in
determining where corporations can be found or transact business.” Id. at 466 n.11 (citing
International Shoe, 326 U.S. at 310). Accordingly, it is in the interest of justice to transfer this
case, so that Plaintiff’s Fair Housing Act claims are not barred by the running of the applicable
statute of limitations. See id. at 466.
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A transfer would also be in the “interest of justice” because a transfer would save the
parties the time and expense associated with refiling. Capital Bank, 276 F. Supp. 2d at 78.
Transferring the case to the Middle District of Florida would provide the parties with an
appropriate forum to “efficiently litigat[e]” the matter. See Sinclair, 711 F.2d at 294. Defendants
would not be prejudiced by a transfer to the Middle District of Florida in light of the fact that the
events at issue took place in that district, and they have raised no arguments regarding any such
prejudice. See Delta Sigma Theta Sorority Inc., 20 F. Supp. 3d at 219. Accordingly, the Court
finds that it is in the “interest of justice” to transfer the case to the Middle District of Florida
pursuant to 28 U.S.C. § 1406.
b. Alternatively, Transferring this Action is in the “Interest of Justice” Pursuant to
28 U.S.C. § 1631Plaintiff alternatively requests that the Court transfer the case to the Middle District of
Florida pursuant to 28 U.S.C. § 1631. Pl.’s Opp’n at 26 n.10. Under Section 1631, courts have
the authority to transfer a civil action filed in the wrong jurisdiction, “if it is in the interest of
justice” to do so. When a case is transferred pursuant to 28 U.S.C. § 1631, it “proceed[s] as if it
had been filed in ... the court to which it is transferred on the date upon which it was actually
filed in ... the court from which it is transferred.” Id. “There are three elements to a section 1631
transfer: (1) there must be a lack of jurisdiction in the district court; (2) the transfer must be in
the interest of justice; and (3) the transfer can be made only to a court in which the action could
have been brought at the time it was filed or noticed.” Fasolyak, 2007 WL 2071644, at *11
(quoting Ukiah Adventist Hosp., 981 F.2d at 549). All three requirements are met in this case.
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1. This Court Lacks Jurisdiction
A district court may transfer an action pursuant to Section 1631 if “that court finds that
there is a want of jurisdiction.” 28 U.S.C. § 1631. Defendants argue that Section 1631 permits
transfer only where a court lacks subject matter jurisdiction, not where the court lacks personal
jurisdiction. See Defs.’ Reply at 14. Defendants’ position has been embraced only by a minority
of district courts outside of this circuit. See, e.g., Pedzewick v. Foe, 963 F. Supp. 48, 50 (D.
Mass. 1997) (citing a Senate Report issued when Congress enacted Section 1631). Most courts,
including the D.C. Circuit, have interpreted Section 1631 according to its plain meaning,
concluding that a court may transfer an action where there is a want of any jurisdiction, whether
it be subject matter jurisdiction or personal jurisdiction. Cf. Hill v. U.S. Air Force, 795 F.2d
1067, 1068–1070 (D.C. Cir. 1986) (considering whether a district court abused its discretion by
failing to transfer a case under 28 U.S.C. § 1631 where the court lacked personal jurisdiction);
see also Trujillo v. Williams, 465 F.3d 1210, 1223 (10th Cir. 2006); Cimon v. Gaffney, 401 F.3d
1, 7 n.21 (1st Cir. 2005); Roman v. Ashcroft, 340 F.3d 314, 328 (6th Cir. 2003); Island Insteel
Systems, Inc. v. Waters, 44 V.I. 389, 296 F.3d 200, 218 n.9 (3d Cir. 2002); Wade v. Farmers Ins.
Group, 96 F.3d 1450 (7th Cir. 1996); Miller v. Hambrick, 905 F.2d 259, 262 (9th Cir. 1990);
Gower v. Lehman, 799 F.2d 925 (4th Cir. 1986); Slatick v. Director, Office of Workers'
Compensation Programs, U.S. Dept. of Labor, 698 F.2d 433, 434 (11th Cir. 1983). Accordingly,
the first requirement of a Section 1631 transfer—that the district court in which the action was
originally filed lacks jurisdiction—is met in this case because the Court lacks personal
jurisdiction over defendants. See Part B, supra.
22
2. Transfer is in the Interest of Justice
A district court may transfer an action pursuant to Section 1631 if that court finds that
transfer is in in “interest of justice.” The Court concludes that transfer is in in the “interest of
justice” under Section 1631 for the reasons stated in the Court’s analysis of this prong in its
discussion concerning Section 1406(a). See Part III.B.a.2.iii, supra.
3. This Action Could Have Been Brought in the Middle District of Florida
Finally, a district court may transfer an action pursuant to Section 1631 only to a court in
which the action “could have been brought at the time it was filed or noticed.” 28 U.S.C. § 1631.
Defendants do not dispute that venue and personal jurisdiction would lie in the Middle District of
Florida. See Defs.’ Reply at 13-18. The Court concludes that the case could have been brought
in the Middle District of Florida for the reasons stated in the Court’s analysis of this prong in its
discussion concerning Section 1406(a). See Part III.B.a.2.ii, supra.
Accordingly, the Court finds that it is in the “interest of justice” to transfer the case to the
Middle District of Florida pursuant to 28 U.S.C. § 1631.
IV. CONCLUSION
For the foregoing reasons, the Court DENIES Defendants’ [14] Motion to Dismiss for
Lack of Personal Jurisdiction and DENIES Plaintiff’s [24] Motion for Leave to File Limited
Surreply. The Court shall transfer this matter to the U.S. District Court for the Middle District of
Florida pursuant to 28 U.S.C. § 1406(a) and 28 U.S.C. § 1631.
An appropriate Order accompanies this Memorandum Opinion.
Dated: September 21, 2015
/s/
COLLEEN KOLLAR-KOTELLY
United States District Judge
23