United States District Court, N.D. California
September 23, 2005.
IN RE FUNERAL CONSUMERS Antitrust Litigation.
The opinion of the court was delivered by: WILLIAM ALSUP, District Judge
ORDER GRANTING MOTION TO TRANSFER
In these antitrust cases, defendants jointly have moved under
28 U.S.C. 1404(a) to transfer venue to the Southern District of
Texas. Defendants have carried their burden of proving that the
convenience of parties and witnesses, and the interest of
justice, would clearly and substantially be improved by such a
transfer. The motion is therefore GRANTED.
The complaint in the first of these cases was filed May 2,
2005. Certain plaintiffs, a consumers group and individual
consumers, purchased caskets and other funeral-industry products
and services. Another plaintiff, Pioneer Valley Casket Co, Inc.,
is an independent, low-cost casket seller. Defendants are
funeral-home chains, a casket manufacturer and its parent
company. Plaintiffs accuse defendants of violating Sections 1 and
2 of the Sherman Act, 15 U.S.C. 1-2, and the California Unfair Competition Law, Cal. Bus.
& Prof. Code §§ 17200-210. The consumers group, Funeral Consumers
Alliance, Inc., and the individual consumers, sue on behalf of a
putative nationwide class of consumers who bought Batesville
caskets from the funeral-home co-defendants, Service Corporation
International (SCI), Alderwoods Group, Inc., and Stewart
Enterprises, Inc. Pioneer Valley sues on behalf of a putative
nationwide class of independent casket retailers. Specifically,
plaintiffs claim defendants
conspired through a group boycott to prevent
independent casket retailers from selling caskets
marketed under the Batesville brand and others,
engaged in a campaign of disparagement against
independent casket retailers and their wares, and
jointly worked to restrict casket price competition
and to coordinate casket pricing by restricting or
preventing price advertising, sharing price
information and promoting "sham" discounting.
On August 2, 2005, defendants jointly moved under
28 U.S.C. 1404(a) to transfer these cases (collectively, "In re Funeral
Consumers Antitrust Litigation") to the Southern District of
Texas. This motion applies to the following of cases, described
here by plaintiff name and case number: FCA (No. C 05-01804
WHA), Rocha (No. C 05-02501 WHA), Berger, (No. C 05-02502
WHA), Magsarili (No. C 05-02792 WHA), and Pioneer Valley (No.
C 05-02806 WHA).
1. VENUE TRANSFER RULES.
"For the convenience of parties and witnesses, in the interest
of justice, a district court may transfer any civil action to any
other district or division where it might have been brought."
28 U.S.C. 1404(a). The section's purpose is "to prevent the waste of
time, energy and money and to protect litigants, witnesses and
the public against unnecessary inconvenience and expense." Van
Dusen v. Barrack, 376 U.S. 612, 616 (1964) (internal quotation
marks omitted). A district court has discretion "to adjudicate
motions for transfer according to an individualized, case-by-case consideration of convenience and fairness." Stewart
Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (citation
omitted). A court must "balance the preference accorded
plaintiff's choice of forum with the burden of litigating in an
inconvenient forum." Decker Coal Co. v. Commonwealth Edison
Co., 805 F.2d 834, 843 (9th Cir. 1986).
In weighing each case, a court also should consider:
(1) the relative ease of access to sources of proof,
(2) availability of compulsory process for attendance
of unwilling witnesses, (3) the cost of obtaining
attendance of willing witnesses, (4) the possibility
of view of premises, if appropriate to the action,
(5) all other issues related to making a trial easy,
expeditious and inexpensive, (6) the relative
congestion of the two courts, (7) the local interest
in having localized controversies decided at home,
(8) the interest in having the trial of a diversity
case in a forum that is at home with the law that
must govern the action, (9) avoidance of unnecessary
problems in conflict of laws, or in the application
of foreign law, and (10) the unfairness of burdening
citizens in an unrelated forum with jury duty, (11)
the location where relevant agreements were
negotiated and executed, (12) the respective parties'
contacts with the forums, (13) contacts relating to
the plaintiff's causes of action in the chosen forum,
and (14) the differences in the costs of litigation
in the two forums.
Ibid.; Jones v. GNC Franchising, Inc., 211 F.3d 495
(9th Cir. 2000).
2. ACTION COULD HAVE BEEN BROUGHT IN THE SOUTHERN DISTRICT OF
There is no dispute that plaintiffs could have brought this
action either here or in the Southern District of Texas. The
unfair competition claim could have been brought in any court of
competent jurisdiction, although this does not mean the
California law reaches extra-territorial conduct. See Cal. Bus.
& Prof. Code § 17203. Antitrust venue may be laid in any district
in which a corporate defendant "may be found or transacts
business." 15 U.S.C. 22. That means that large corporations are
subject to suit in virtually every corner of the country, given
their commonly wide scope of operations these days. Such breadth
of operations provokes motions such as the present one to
transfer venue under 28 U.S.C. 1404(a).
The Court finds that venue would have been proper in the United
States District Court for the Southern District of Texas. It
would have had jurisdiction over the federal antitrust actions under 28 U.S.C. 1331 and supplemental jurisdiction over the
state-law claim under 28 U.S.C. 1367.
3. BALANCING THE FACTORS: AN OVERVIEW.
No plaintiff resides in this district. Only one of the dozen or
so plaintiffs even resides in California. Most reside on the East
Coast. All of defendants' principal places of businesses are in
Houston or points east. No operative fact is alleged to have
occurred in this district. On the other hand, defendant funeral
home companies operate 44 funeral homes in this district and 228
in California (as well as many others nationwide). The Rule 26(a)
disclosures reveal some witnesses in California. Most, however,
reside in Texas or on the other side of the Mississippi River. No
district claims a majority of all witnesses, but the Southern
District of Texas claims more than any other district.
Section 1404(a) calls out three factors to guide a transfer
motion: (i) the convenience of parties, (ii) the convenience of
witnesses and (iii) the interest of justice. In volumes, the
caselaw has illuminated the meaning of these three factors. This
order will concentrate on the caselaw most pertinent to the
record at hand.
Under Section 1404(a), a plaintiff's choice of venue is
entitled to substantial weight, although this is often said to be
less controlling in a purported nationwide class actions, as
here. Lou v. Belzberg, 834 F.2d 730, 739 (9th Cir. 1987).
At all events, movants must make a clear-cut showing. The issue
is not merely whether some other district would better serve the
parties and witnesses. The burden is on the moving parties to
show that the Section 1404(a) factors would clearly be better
served by a transfer.
4. PARTY CONVENIENCE.
We may not use a transfer simply to shift the burden of venue
from one side to the other. Here, however, no plaintiff resides
in this district and only one resides in California. The clear
center of gravity of the residences of all plaintiffs is well
east of the Mississippi River.
Houston is the principal place of business of the largest of
defendant funeral-home company, SCI, and is in the Southern
District of Texas. Another defendant funeral-home company is
Stewart, headquartered in New Orleans. In the wake of Hurricane
Katrina, it has temporarily moved its headquarters to Irving, Texas. Alderwoods
is the third defendant funeral-home company. It is headquartered
in Cincinnati. All three own and operate outlets in this
district. Given their nationwide scope, their connections to this
district are similar to their connections to districts elsewhere
in America. Their executive offices and the representatives
supervising the defense, however, are in the cities stated
Houston, New Orleans and Cincinnati.
The three funeral-home chains are alleged to have entered into
a horizontal conspiracy to stamp out independents who seek to
sell low-priced caskets to bereaved families. Plaintiffs claim
this forced consumers to pay exorbitant prices for caskets. The
three allegedly pressured a prominent manufacturer, defendant
Batesville Casket Company, to refuse to do business with the
independents, thus cutting off the independents from a source of
quality product. Batesville has its headquarters in Batesville,
Indiana. The last defendant is Batesville's parent, Hillenbrand
Industries, Inc., also located in Batesville.
How will the situs of this case affect the burden on the
parties? In addition to litigation counsel, corporate
representatives can be reasonably expected to attend various
hearings and the trial. Given the complexity and scope of the
case, more hearings can be expected than in the usual case, not
counting mere discovery conferences with the judge that may be
manageable by telephone. The trial can surely be expected to last
longer than the usual case. All of this means that more days will
be spent in court by the parties themselves than in the usual
A transfer to the Southern District of Texas will drastically
reduce the burden on the largest funeral-home defendant, SCI.
And, it will significantly reduce the burden on the other
defendants as well. The travel times from their locations to the
Southern District are all markedly less than the travel times to
San Francisco, as the record demonstrates in detail. The same is
true for almost all of the plaintiffs. The Southern District
seems to present a clear advantage over San Francisco.*fn1 Although a few decisions have given weight to the location of
counsel, most have not, saying that it is not to be considered at
all or to be given very little weight. Charles Alan Wright,
Arthur R. Miller & Edward H. Cooper, Federal Practice &
Procedure, § 3850 (2d ed. 1986). One reason is that it would be
easy to manipulate venue simply by obtaining counsel in the venue
of choice. Be that as it may, it is worthwhile to note that the
largest team of plaintiffs' counsel in this action is based in
New York. Even for plaintiffs' counsel, therefore, the burden
would be diminished by a transfer to the Southern District of
5. WITNESS CONVENIENCE.
In assessing a Section 1404(a) transfer motion, the matter of
trial witnesses subdivides into two parts: the willing and the
unwilling. Willing witnesses are those who can be expected to
appear at trial voluntarily, meaning without the necessity of a
subpoena. The unwilling are those who can be expected to testify
live at trial only if they are within subpoena range of the
As for the willing, the convenience-of-witnesses factor looms
large. These individuals must take time out of their work and
private time to travel to and from the place of trial, to live
away from home and to wait around windowless corridors on call to
testify. Back home, they have children to get to school, elderly
parents to care for, jobs to do and lives to lead all of which
must be managed somehow or put on hold. Although lawyers tend to
underestimate this burden, it is genuine, all the more so in a
distant city. Even where a witness is an employee of a party and
will be paid, the disruption is still a hard fact. The expenses
of transportation, housing and meals, even if borne by a party,
are nonetheless authentic outlays. See, e.g., Decker Coal,
805 F.2d at 843. Among other things, Section 1404(a) prefers a venue
where the burden on witnesses will be clearly reduced.
Belzberg, 834 F.2d at 739.*fn3
In order to better appreciate the comparative witness burdens
associated with the two districts in question, the Court
requested post-hearing supplemental information to include all Rule 26(a) disclosures of potential witnesses, among other
things. This was invited so that the prospective witnesses, as
disclosed by counsel themselves, could be, in effect, imagined on
a map of the United States. These were submitted and reviewed by
The Rule 26(a) disclosures identified a large number of
witnesses. Plaintiffs identified 69 individuals and organizations
likely to have discoverable information that plaintiffs might use
to support their claims. One is a resident of this district. A
half-dozen live in other parts of California. The overwhelming
majority are in Texas or east of the Mississippi River, including
present and former employees of defendants. Plaintiffs also
listed every state funeral-directors association. Plaintiffs also
listed 161 casket retailers throughout the country, six of which
are located in this district. Defendants listed 209 individuals
throughout the United States, of which one resides in this
district and 49 reside in Houston. Overall, the vast majority
reside east of the Mississippi River.
We all know that the final trial witnesses will be a much
smaller subset. In a Sherman Act case, the key liability
witnesses (on both sides) are usually present and former officers
and employees of the accused. This is because they were the ones
at various meetings alleged to be conspiratorial or with pricing
and marketing responsibilities. When a nationwide antitrust
conspiracy is alleged, the key witnesses usually work (or worked)
at a national office or a regional office rather than a local
retail outlet. Therefore, the final trial witnesses (on
liability) are very likely to be drawn in this case from Houston
and east of the Mississippi River, as plaintiffs' own Rule 26
disclosures bear out. The damages witnesses will likely be
plaintiffs themselves (and retained experts as yet unknown).
Plaintiffs now showcase four California-based witnesses. One is
the editor of the Funeral Monitor, an industry newspaper
published in Monterey. The complaint (¶¶ 63, 68, 75-76) quotes
from four or so articles therein. It is hard to see, however, how
newspaper articles will be admissible at trial. The same is true
as to any information possessed by the editor. It will be largely
hearsay. As for Mark Blankenship, the record does not show that
he resides in California. He may work for a chain with an outlet
in Susanville, California, but his residence is not shown to be in the state.*fn4 On the other hand,
plaintiffs may well be entitled to call the spokesperson for the
California Funeral Directors Association who made the disparaging
comment (Compl. ¶ 80). For that California witness to appear in
Texas will be more burdensome. The same is true for the president
of the association. Against the larger picture of the far greater
number of witnesses in Texas, as shown by the Rule 26
disclosures, the California witnesses shrink into insignificance.
6. THE INTEREST OF JUSTICE.
Unwilling witnesses present more of an "interest of justice"
problem than a "convenience of witnesses" problem. In the conduct
of the trial itself, any jury would prefer to see and hear
important witnesses in person. In this way, the jury can better
assess demeanor and credibility. And, live testimony is easier to
follow and comprehend than deposition read-ins or video clips.
The difficulty is exacerbated by the fact that depositions are
often taken before certain fact issues gather importance. They
may, therefore, not fully address points decisive to the jury.
Live testimony, therefore, always is to be preferred over
deposition excerpts.*fn5 A problem arises when witnesses are
beyond trial subpoena range and they can only be compelled to
attend via depositions.
To be sure, a corporate defendant can be expected to arrange
for some present and past employees to testify live and
voluntarily but only if their testimony will be favorable on
balance to the defense. Those with testimony favorable to the
other side are often unwilling to appear except by deposition
unless, of course, they are within subpoena range of the trial
court. It would be better to try a case where any such unwilling
but important witnesses could be compelled to appear in person.
Plaintiffs' counsel may be prepared to proceed via deposition but
we should not force a jury to suffer through it where there is a
good alternative. At this stage, it is impossible to predict exactly who the
unwilling witnesses will be. Experience tells us, however, that
they are likely to be present and former employees of defendants.
If they have information favorable to the other side, such
individuals are usually reluctant to testify against their former
and present colleagues unless compelled to do so. So while we do
not yet know who precisely will fall into this category, it is
reasonably certain that such witnesses will emerge. Houston has
the largest single concentration of such potential witnesses.
Those witnesses will be subject to trial subpoenas only in the
Southern District of Texas.
In terms of "local interest," i.e., the connection of the
respective districts to the subject of the action, the Southern
District of Texas has a larger stake. Both districts, of course,
have funeral homes operated by the alleged wrongdoers. Both
districts have alleged victims (bereaved families and independent
casket retailers) in the putative classes. What distinguishes
them is that the largest of the defendant funeral-home chains is
based in Houston, not San Francisco. That alone is a substantial
connection. Moreover, conspiratorial events, if there were any,
were likely to have occurred in Houston. None would have likely
occurred in this district (and none is alleged to have occurred
Turning to another interest-of-justice consideration,
plaintiffs argue that our district has less work than the
Southern District of Texas and therefore this case could go to
trial sooner here than there. The statistics submitted do not
bear out this claim. In terms of "weighted" filings per judge,
our district shows a heavier caseload per judge over the six-year
period of data supplied by plaintiffs' counsel although, for
2003-04 and 2004-05, the Southern District had a slightly heavier
load. The median time to trial for civil cases is faster in the
Southern District than here. It is true that we have fewer
criminal actions here but the majority of the criminal docket in
the Southern District, especially in the divisions other than in
the Houston division, are § 1326 illegal immigration cases, which
almost always plead out without much burden on the judge.
Overall, it is unfair to claim that the Southern District is not
equipped to handle this large civil action as expeditiously as it
could be handled here. In this regard, it should be added that
counsel on both sides, at the initial case management conference,
requested trial dates of November 2007 (plaintiffs' choice) and January 2008 (defendants'
choice), both very far into the future. This Court required an
earlier date in December 2006. The point is that neither side
seemed to be in a hurry to go to trial; it is somewhat insincere
not to express regret over a possibly longer timetable.
The basis for subject-matter jurisdiction is the federal
antitrust law. Under the Court's supplemental jurisdiction,
however, plaintiffs have alleged a claim under Section 17200 of
California's Unfair Competition Law, at least on behalf of the
general public in California. It is probably true that judges in
this district will be better able to handle this state-law claim
than judges in the transferee district. But the tail should not
wag the dog. This is first and foremost a purported nationwide
antitrust class action under the Sherman Act. The caselaw
favoring the district "at home" on the controlling law has arisen
in the diversity context, not the federal-question context.
Decker Coal, 805 F.2d at 843. If the main federal event is
clearly better served in the Southern District of Texas than in
San Francisco, the pendency of a supplemental state-law claim
should not override the indicated result. Moreover, the
submissions indicate that federal judges in Texas are familiar
with the Texas analogue to California Section 17200. Finally,
Pioneer Valley has alleged Texas as well as California state-law
antitrust and unfair-competition claims. In any case, this
state-law question is a very small factor in the overall balance.
* * *
In summary, the clear balance of the statutory factors favors
transfer. The chief consideration the other way is plaintiffs'
choice of forum. Although that choice is normally given
substantial weight, the Ninth Circuit has qualified that rule:
If the operative facts have not occurred within the
forum of original selection and that forum has no
particular interest in the parties or the subject
matter, the plaintiff's choice is entitled only to
Pacific Car and Foundry Co. v. Pence, 403 F.2d 949, 954 (9th
Cir. 1968). That this is brought as a nationwide class action
further dilutes the deference due plaintiffs' choice. Belzberg,
834 F.2d at 739. Plaintiffs also argue that 15 U.S.C. 22, the law
granting them a wide choice of venue in antitrust actions,
entitles their choice to special deference upon a motion for
transfer. This is not the law. Courts may transfer cases under Section
1404(a) even though they are filed pursuant to 15 U.S.C. 22.
United States v. Nat'l City Lines, 337 U.S. 78
, 84 (1949).
Furthermore, the questions of proper venue and transfer of venue
have a different relationship in the instant case than plaintiffs
suggest. Cf. Ex parte Collett, 337 U.S. 55
, 60 (1949) (holding,
in the context of a similar venue statute, 45 U.S.C. 56, that the
venue statute and Section 1404(a) "deal with two separate and
distinct problems."). Title 15 U.S.C. 22 makes venue here in this
case proper. Whether to transfer it under Section 1404(a) is,
however, another matter. In this case, movants have carried their
* * *
After the record was closed on this motion and as this order
was being finalized, the Court received a further declaration
from counsel for plaintiffs. It stated that, in about ten days,
counsel would be adding a further-named plaintiff resident in
this district. The record shows that the day after the hearing of
this motion, plaintiffs' counsel sent out a solicitation letter.
The letter was sent to families who had purchased caskets from
funeral homes in the district. Counsel's letter invited them to
join the suit as named plaintiffs, advising that "We are seeking
a few more individuals to serve as class representatives." The
letter added, "Being a class representative takes very little
time, will cost you nothing, and may entitle you to compensation
over and above any overcharge you paid for a casket." Evidently,
someone from San Jose has answered the call.
The Court has carefully considered whether this potential
development would change the outcome on this motion. The answer
is no. First, we will take counsel at his word in his
solicitation letter that "being a class representative takes very
little time." If so, the inconvenience to the solicited potential
new party will be minimal no matter where venue is laid.
Second, even adding a new plaintiff to the dozen already on
board would not significantly shift the geographic center of
gravity of all plaintiffs. Third, the solicitation of a new
party after the fact to shore up local contacts for purposes of a
pending § 1404 issue smacks of forum-shopping. The caselaw holds
that if "there is any indication that plaintiff's choice of forum
is the result of forum shopping, plaintiff's choice will be
accorded little deference." Williams v. Bowman, 157 F. Supp. 2d 1103, 1106 (N.D. Cal. 2001) (Walker, J.); Italian
Colors Restaurant v. American Express Co., No. C 03-3719 SI,
2003 WL 22682482 at *3-5 (Nov. 10, 2003 N.D. Cal.) (Illston, J.).
Fourth, as stated, plaintiffs' choice of forum is accorded less
weight where the action is brought, as here, as a class action,
all the more so when it is brought as a nationwide class action.
Belzberg, 843 F.2d at 739.
* * *
For the foregoing reasons, the motion to transfer is GRANTED
in the following cases: FCA (No. C 05-01804 WHA), Rocha (No.
C 05-02501 WHA), Berger, (No. C 05-02502 WHA), Magsarili (No.
C 05-02792 WHA), and Pioneer Valley (No. C 05-02806 WHA). The
Clerk shall transfer the files to the Clerk for the Southern
District of Texas. Meanwhile, the amended complaint and follow-on
motions to dismiss should be served on the timetable previously
set. When the cases arrive in the Southern District of Texas, the
pleadings and motions should be filed with the court. This will
avoid any interruption in the prosecution of the cases, all of
this, of course, being wholly subject to whatever new schedule
will be set by the transferee court.
IT IS SO ORDERED.
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