Baylson, F. v. Genetics & IVF Inst.

J-A30035-14
2015 PA Super 27FRANCES R. B. BAYLSON AND IN THE SUPERIOR COURT OF
MICHAEL M. BAYLSON PENNSYLVANIA
Appellants
v.
GENETICS & IVF INSTITUTE A/K/A
FAIRFAX CRYOBANK AND MORRIS AND
CLEMM, PC AND MARK CLEMM
Appellees No. 228 EDA 2014
Appeal from the Order Entered November 27, 2013
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): 130500893
BEFORE: LAZARUS, J., MUNDY, J., and PLATT, J.*
OPINION BY LAZARUS, J.: FILED FEBRUARY 09, 2015
Frances R.B. Baylson (Dr. Batzer) and her husband, Michael M.
Baylson (collectively, Appellants) appeal from the orders of the Court of
Common Pleas of Philadelphia County, transferring this matter to the Court
of Common Pleas of Montgomery County. After careful review, we reverse
and remand.
On May 10, 2013, Appellants commenced this action for wrongful use
of civil proceedings (Dragonetti Act, 42 Pa.C.S. §§ 8351-8354) by filing a
praecipe for a writ of summons against Genetics & IVF Institute a/k/a Fairfax
Cryobank (Genetics) and Morris and Clemm, PC (M&C) and Mark Clemm,
____________________________________________
*
Retired Senior Judge assigned to the Superior Court.
J-A30035-14
Esquire (Clemm). In their complaint filed August 12, 2013, Appellants
averred that their claim arose out of a lawsuit filed in the Court of Common
Pleas of Montgomery County, Genetics & IVF Institute, et al. v.
Pennsylvania Reproductive Associates, Inc., et al., No. 2011-27330
(the Montgomery County action), in which Genetics was represented by M&C
and Clemm, and Dr. Batzer was named as an individual defendant. On May
16, 2012, the Montgomery County trial court dismissed that matter with
prejudice, having determined that, pursuant to the contract at issue,
jurisdiction was proper only in the courts of Virginia.1
In their Dragonetti Act complaint, Appellants aver the following: they
are residents of Philadelphia; Genetics is a Virginia corporation that conducts
____________________________________________
1
In its amended complaint in the Montgomery County action, plaintiff
Genetics states that it is in the business of storing reproductive material. It
names as defendants Pennsylvania Reproductive Associates, Inc. (PRA),
Philadelphia Fertility Institute, Inc. (PFI), and Fertility Testing Laboratories,
Inc. (FTL). Genetics also names as individual defendants four physicians,
including Dr. Batzer, whom it identifies as officers, directors and
shareholders of PRA, PFI and FTL. Genetics also avers that “PRA, PFI and
FTL were sham corporations used by [the four doctors] to conduct their own
personal business.” Amended Complaint, 11/22/11, at ¶ 16.
In 2007, Genetics entered into two-year storage lease agreements with PRA
and FTL to store frozen embryos, tissue and sperm. Genetics avers that the
corporate entities are no longer in business, the leases have expired, and
that despite its demands, “the Defendants have failed and/or refused to
remove the tanks containing the Reproductive Material.” Id. at 24. The
amended complaint seeks damages for breach of contract and equitable
relief, including an order directing defendants to remove the reproductive
material from its facility.
-2-
J-A30035-14
business in Pennsylvania; at all relevant times, Genetics operated an office
in Philadelphia; and Genetics’ counsel, M&C and Clemm, practice law in
Montgomery County. Complaint, ¶¶ 1-3.
Appellants assert that Genetics and its counsel knew that the
corporate parties to the lease had been dissolved, and that Dr. Batzer was
not personally involved in the affairs of the dissolved companies. Id. at ¶
10. Furthermore, they allege that Genetics and its counsel knew that
Genetics’ claim could not be brought in any Pennsylvania court because the
lease agreement limited jurisdiction to Virginia courts. Id. at ¶ 12.
Appellants further allege that Genetics knew the allegations that the
corporate entities were a sham were “completely false and meritless.” Id.
at ¶ 31. They also allege that M&C and Clemm “ignored and breached their
duty to investigate the facts concerning Dr. Batzer before filing the original
complaint and before filing the amended complaint against Dr. Batzer.” Id.
at ¶ 32.
On August 14, 2013, M&C and Clemm filed preliminary objections
raising improper venue and failure to state a cause of action, and on
September 4, 2013, Genetics filed preliminary objections on several bases,
none of which related to venue. On November 27, 2013, the court issued
separate orders sustaining the preliminary objections to venue filed by
-3-
J-A30035-14
Genetics and M&C and Clemm, transferring the case to Montgomery
County.2
This timely appeal followed in which the sole issue raised is whether
the trial court erred by ordering a change of venue from Philadelphia County
to Montgomery County in a wrongful use of civil proceedings case, solely
because the underlying litigation was filed in Montgomery County.3
When reviewing a trial court’s decision to transfer venue, our
standard of review is as follows: A trial court’s decision to
transfer venue will not be disturbed absent an abuse of
discretion. An abuse of discretion occurs when the trial judge
overrides or misapplies the law, or exercises judgment in a
manifestly unreasonable manner, or renders a decision based on
partiality, prejudice, bias or ill-will.
Sehl v. Neff, 26 A.3d 1130, 1132 (Pa. Super. 2011) (citation and quotation
marks omitted).
As an initial matter, we note that pursuant to Pa.R.C.P. 2179, a
personal action against a corporation may be brought in the county where its
registered office or principal place of business is located, or a county where
it regularly conducts business. See Pa.R.C.P. 2179(a). Here, Genetics
operated an office at 3401 Market Street in Philadelphia, thus making
Philadelphia County a proper venue for Appellants’ action against it.
____________________________________________
2
As noted above, Genetics did not object to venue. “Improper venue shall
be raised by preliminary objection and if not so raised shall be waived.”
Pa.R.C.P. 1006(e).
3
“An appeal may be taken as of right from an order in a civil action . . .
changing venue . . . .” Pa.R.A.P. 313(c).
-4-
J-A30035-14
Furthermore, an action to enforce joint and several liability against two or
more defendants “may be brought against all defendants in any county in
which the venue may be laid against one of the defendants.” Pa.R.C.P.
1006(c). Accordingly, under Rule 1006(c), Philadelphia County was a proper
venue to sue both Genetics and its counsel.4
Nevertheless, the trial court transferred the instant matter to
Montgomery County relying upon two decisions from this Court: Harris v.
Brill, 844 A.2d 567 (Pa. Super. 2004); and Kring v. University of
Pittsburgh, 829 A.2d 873 (Pa. Super. 2003). While these cases, which
both involve Dragonetti actions, are relevant, we disagree that they support
the trial court’s conclusion that “[v]enue is proper only in Montgomery
County. Venue is not proper in Philadelphia and this court has no
jurisdiction to hear the case.” Order, 11/27/13, Ex. A, at 2. Rather, as
explained herein, venue is proper in both counties.
In Kring, the University of Pittsburgh School of Law’s Health Law Clinic
represented a patient who filed an action against a Washington County
dentist in the U.S. District Court for the Western District of Pennsylvania, in
Pittsburgh. The suit was filed under the Americans with Disabilities Act, 42
____________________________________________
4
We note that the Pennsylvania Supreme Court has not provided an
exception to the general venue rules for Dragonetti actions, as it did for
medical professional liability actions against a healthcare provider, which
may only be brought in the county in which the cause of action arose. See
Pa.R.C.P. 1006(a.1).
-5-
J-A30035-14
U.S.C. §§ 12101-12213, and, after trial, the jury ruled in favor of Kring, and
against the patient.
Kring subsequently filed a complaint in the Court of Common Pleas of
Washington County raising a Dragonetti claim against the University. The
University filed preliminary objections claiming improper venue, which the
trial court sustained, “concluding that venue is improper in Washington
County, but proper in Allegheny County.” Kring, 829 A.2d at 675.
Venue is proper in the county where a transaction or occurrence took
place out of which the cause of action arose. See Pa.R.C.P. 1006(a)(1);
Pa.R.C.P. 2179(a)(3)(4). Kring holds that a cause of action for wrongful
use of civil proceedings occurs when the underlying lawsuit terminates in
favor of the Dragonetti Act plaintiff. In Kring, this occurred in Allegheny
County when the federal district court rendered a verdict in favor of Kring.
Accordingly, the transaction or occurrence requirement could not serve as a
basis for venue in Washington County. Additionally, this Court rejected
Kring’s argument that the University regularly conducts business in
Washington County, thus precluding venue based on Pa.R.C.P. 2179(a)(2)
(action may be brought against corporation or similar entity where it
regularly conducts business).
Faced with a situation where there was no venue in Washington
County, but there was venue in Allegheny County, the Kring court properly
transferred the matter to Allegheny County.
-6-
J-A30035-14
Kring does not stand for the broad proposition that a plaintiff may
bring a Dragonetti action only in the county where the underlying action took
place. Rather, it stands for the more limited proposition that venue is proper
in that county.
In Harris, supra, three individuals, who were residents of Crawford
County, filed a lawsuit against Harris alleging violations of the Racketeering
Influenced Corrupt Organizations Act (RICO), 18 U.S.C. §§1961-1968 in the
Court of Common Pleas of Crawford County. Harris removed the action to
U.S. District Court for the Western District of Pennsylvania, in Erie. While
the matter was pending, each plaintiff filed a voluntary dismissal of his
claim.
Subsequently, Harris filed a Dragonetti action against the three
individuals in the Court of Common Pleas of Erie County. The defendants
filed preliminary objections asserting that venue was improper in Erie
County, and that the case should be transferred to Crawford County under
forum non conveniens pursuant to Pa.R.C.P. 1006(d)(1). The trial court
agreed, and transferred the matter to Crawford County.
On appeal, this Court reversed, noting that in a claim involving an
individual, venue is appropriate where “a transaction or occurrence took
place out of which the cause of action arose.” Pa.R.C.P. 1006(a).
Consistent with Kring, this Court held that termination of the federal court
litigation in Erie County rendered Erie County the place where the claim for
wrongful use of civil proceedings arose. Therefore, venue was proper in Erie
-7-
J-A30035-14
County. However, we noted, “this does not mean that venue in this case is
improper in Crawford County.” Harris, supra at 572.5 Accordingly, this
Court reversed the order of the trial court and remanded for further
proceedings, including the determination of preliminary objections to venue
based on forum non conveniens.
Likewise, in the instant matter, venue is proper in Philadelphia because
Genetics had an office in Philadelphia and regularly conducted business
there. See Pa.R.C.P. 2179. Accordingly, under Pa.R.C.P. 1006(c)(2), which
governs joint and several liability among defendants, venue is also proper in
Philadelphia with respect to Appellees M&C and Clemm. It is equally clear
that venue is proper in Montgomery County because that is where the
underlying suit was decided, leading to the events from which the wrongful
use of civil proceedings arose. See Kring, supra; Harris, supra.Because the trial court erred when it held that venue is proper only in
Montgomery County, and not in Philadelphia County, we reverse the orders
of the Court of Common Pleas and remand for the court to rule on the
remaining preliminary objections.
Order reversed; matter remanded for proceedings consistent with this
opinion; jurisdiction relinquished.
____________________________________________
5
In their preliminary objections, the Harris defendants noted they were
residents of Crawford County. Accordingly, venue was also proper in
Crawford County because the defendants could be served there. See
Pa.R.C.P. 1006(a)(1).
-8-
J-A30035-14
Judge Platt did not participate in the consideration or decision of this
case.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/9/2015
-9-