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Laura Leskinen v. Carolyn A. Halsey

September 9, 2011


The opinion of the court was delivered by: Kendall J. Newman United States Magistrate Judge


Presently before the court is a motion to dismiss for lack of personal jurisdiction and improper venue filed by defendants Joe Nemeth and Pinks, Arbeit & Nemeth (collectively, the "Nemeth Defendants").*fn1 (Dkt. No. 42.) The undersigned heard the Nemeth Defendants' motion on its law and motion calendar on September 8, 2011. Attorney Charles Coleman appeared at the hearing on behalf of the Nemeth Defendants.*fn2 Plaintiff, who is proceeding without counsel, appeared and represented herself at the hearing.

The undersigned has considered the briefs, oral arguments, and appropriate portions of the record in this case and, for the reasons stated below, recommends that the Nemeth Defendants' motion to dismiss be granted in part and denied in part as moot. Specifically, the undersigned recommends that the Nemeth Defendants' motion to dismiss for improper venue be granted, but that those defendants' motion to dismiss for lack of personal jurisdiction be denied as moot. Even assuming that this court may exercise personal jurisdiction over the Nemeth Defendants or any other defendants in this action, the Eastern District of California is not a proper venue for this action as to thirteen of the fourteen named defendants, whether analyzed under the general venue statute, 28 U.S.C. § 1391(b), or the special venue provision contained in the Racketeer Influenced and Corrupt Organizations Act ("RICO Act"), 18 U.S.C. § 1962(a). This district is an inappropriate one with respect to the one defendant who appeared and arguably waived an objection to venue. In short, this action concerns a family dispute over a piece of real property located in Suffolk County, New York, and has no connection to the Eastern District of California other than the fact that plaintiff resides in this district. Plaintiff's residence in the district is insufficient to establish venue in this court and, accordingly, the undersigned recommends that this entire action be transferred to the United States District Court for the Eastern District of New York pursuant to 28 U.S.C. §§ 1404(a) and 1406(a).


Plaintiff's 84-page Second Amended Complaint is the operative complaint and alleges eleven claims for relief against fourteen defendants. (See generally Second Am. Compl., Dkt. No. 15.) Briefly stated, plaintiff's claims arise from what is essentially a family dispute over plaintiff's now-deceased grandmother's living trust and will and, in particular, the sale of an asset consisting of real property that belonged to plaintiff's grandmother and is located at 114 Griffing Avenue in Westhampton Beach, Long Island, New York. (See Second Am. Compl. ¶¶ 6-7, 35.) Plaintiff alleges that the most recently assessed value of the property is $883,000. (Id. ¶ 7.)

Plaintiff alleges that her grandmother, Eva Blazek, died on March 14, 2008, "leaving a will on file in Suffolk County, NY naming [plaintiff] beneficiary of a portion of her assets, including her real property." (Second Am. Compl. ¶ 8; see also id. ¶¶ 35, 37.) Central here, plaintiff alleges that Blazek amended a 1992 living trust through a 1996 will that named plaintiff and her three siblings, who are named defendants,*fn3 as "per stirpes" beneficiaries of their now-deceased mother's 25% share of Blazek's assets. (See id. ¶¶ 8-9.) Thus, plaintiff claims a 6.25% (i.e., one quarter of 25%) interest in her grandmother's estate that includes the property in question. (See id. ¶¶ 39, 138.) Without analyzing the merits of the action or any factual disputes going to the merits, the undersigned notes that the Nemeth Defendants dispute plaintiff's allegations regarding the disposition of Blazek's assets; the Nemeth Defendants contend that Blazek's interest in the real property was limited to a life estate as of 1992 and that, therefore, Blazek had no interest in the property to convey through the 1996 will. The correct disposition of Blazek's estate is not relevant to the present motion.

Plaintiff alleges that on December 22, 2010, the property in question was unlawfully sold, but that as of February 2011, the current owners are listed as defendant Barbara Allan, defendant Carolyn Halsey, now-dismissed defendant Muriel Murphy, and non-defendant Estate of Elinor Whitman, the last of which is the estate of plaintiff's deceased mother. (Second Am. Compl. ¶¶ 7, 93, 98.) Exhibit 3 to plaintiff's pleading, which is a copy of the purported contract for sale of the property, indicates that Todd and Lynn Andrews were the purchasers and that Allan, Halsey, Murphy, and the Estate of Elinor Whitman were the purported sellers. However, plaintiff disputes that any lawful sale actually took place, and she cites her own "Public Records check" conducted in February 2011. (Id. ¶ 93.) Plaintiff alleges, in essence, that the named defendants participated in a wide-ranging conspiracy-essentially, a fourteen-member racketeering enterprise-to avoid the lawful probate or administration of Blazek's will and to fraudulently deprive plaintiff of plaintiff's 6.25% share of the proceeds from the sale of the real property. (See id. ¶¶ 6, 45-46, 107.)

Plaintiff alleges eleven claims for relief: (1) two claims of a fourteen-defendant conspiratorial "enterprise" in violation of the RICO Act, with claims premised on federal criminal mail fraud and wire fraud statutes (see Second Am. Compl. ¶¶ 116-33); (2) one claim of "common law fraud" (see id. ¶¶ 134-43); (3) one claim for "willful negligence" (see id. ¶¶ 143-54); (4) one claim of negligent misrepresentation (see id. ¶¶ 155-62); (5) five claims of violations of various New York statutes or codes governing the settlements of estates, the probating and administration of wills, breaches of fiduciary duties, and the administration of trusts (see id.

¶¶ 163-208); and (6) one claim of emotional distress (see id. ¶¶ 209-17). The alleged conspiracy underlies all of plaintiff's claims. Plaintiff's claims other than those alleged pursuant to New York statutes or codes are alleged against "all defendants."

On July 19, 2011, the Nemeth Defendants filed the pending motion to dismiss. Plaintiff filed a timely written opposition to the motion. Ten of the remaining twelve named defendants have appeared in the action. Defendant Jennifer McHenry, who like her sister is proceeding without counsel, filed a one-page, hand-written document that can be liberally construed as constituting an answer to the Second Amended Complaint.*fn4 Nine other defendants, many of whom are proceeding pro se, have appeared in the action and filed various motions to dismiss, all of which contain challenges to personal jurisdiction and venue in this district. (See Dkt. Nos. 26-31, 45, 55, 57, 71-72, 84.) Those motions are presently set to be heard by the undersigned on October 6, 2011. (See Order, Aug. 26, 2011, Dkt. No. 83.) Defendants Mike Carroll and Marketplace Realty have not yet appeared in the action.


The Nemeth Defendants move to dismiss on the grounds that: (1) this court lacks personal jurisdiction over them; and (2) the Eastern District of California is not a proper venue for this action. The undersigned concludes that as to thirteen of the fourteen defendants, venue is improper and recommends that this action be transferred to the United States District Court for the Eastern District of New York pursuant to 28 U.S.C. § 1406(a). Regarding defendant Jennifer McHenry, who arguably waived any venue objection by answering the Second Amended Complaint without objecting to venue in this district, the undersigned recommends that the claims against her be transferred to the Eastern District of New York based on the convenience of the parties and witnesses and in the interests of justice pursuant to 28 U.S.C. § 1404(a). Because the undersigned recommends the transfer of this entire case on venue grounds, the undersigned recommends that the Nemeth Defendants' motion to dismiss for lack of personal jurisdiction be denied as moot.

A. Legal Standards Governing the Challenge to Venue The determination of a proper venue in a civil action is generally governed by 28 U.S.C. § 1391. "In most instances, the purpose of statutorily specified venue is to protect the defendant against the risk that a plaintiff will select an unfair or inconvenient place of trial." Leroy v. Great Western United Corp., 443 U.S. 173, 183-84 (1979). "When there are multiple parties and/or multiple claims in an action, the plaintiff must establish that venue is proper as to each defendant and as to each claim." All-star Mktg. Group, LLC v. Your Store Online, LLC, 666 F. Supp. 2d 1109, 1126 (C.D. Cal. 2009) (quoting Kelly v. Echols, No. Civ. F05118 AWI SMS, 2005 WL 2105309, *11 (E.D. Cal. Aug. 30, 2005) (unpublished)).

Relevant here, 28 U.S.C. § 1391(b), which addresses civil actions where federal subject matter jurisdiction is not premised solely on diversity of citizenship,*fn5 provides:

A civil action wherein jurisdiction is not founded solely on diversity of citizenship may, except as otherwise provided by law, be brought only in

(1) a judicial district where any defendant resides, if all defendants reside in the same State, (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) a judicial district in which any defendant may be found, if there is no district in which the action may otherwise be brought.

Additionally, relevant to plaintiff's RICO Act claims, 18 U.S.C. § 1965(a) contains a special RICO-related venue provision that states: "Any civil action or proceeding under this chapter against any person may be instituted in the district court of the United States for any district in which such person resides, is found, has an agent, or transacts his affairs" (emphasis added). "[A]s a general matter, courts have interpreted special venue provisions to supplement, rather than preempt, general venue statutes." Go-Video, Inc. v. Akai Elec. Co., 885 F.2d 1406, 1409 (9th Cir. 1989). Accordingly, plaintiff may establish proper venue in the Eastern District of California on the basis of 28 U.S.C. § 1391(b) or 18 U.S.C. § 1965(a).

Once a defendant challenges venue as improper, the plaintiff bears the burden of showing that venue is proper in the district in which the suit was commenced. Hope v. Otis Elevator Co., 389 F. Supp. 2d 1235, 1243 (E.D. Cal. 2005); see also Piedmont Label Co. v. Sun Garden Packing Co., 598 F.2d 491, 496 (9th Cir. 1979). In determining whether venue is proper, the Court may consider facts outside the pleadings, such as declarations and affidavits, and need not accept the pleadings as true. See, e.g., Murphy v. Schneider Nat'l, Inc., 362 F.3d 1133, 1137 (9th Cir. 2004); Richards v. Lloyd's of London, 135 F.3d 1289, 1292 (9th Cir. 1998). The Ninth Circuit Court of Appeals has held that, at least in the context of a challenge to venue based on a forum selection clause, "the trial court must draw all reasonable inferences in favor of the non-moving party and resolve all factual conflicts in favor of the non-moving party." Murphy, 362 F.3d at 1138.

If the district court determines that venue in that district is improper, the court may either dismiss the action without prejudice or, "if it be in the interest of justice," transfer the action to any district in which the action could have originally been brought. 28 U.S.C. § 1406(a) ("The 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."); see also King v. Russell, 963 F.2d 1301, 1304 (9th Cir. 1992). Additionally, even if venue is proper in the district in which a plaintiff filed the action, "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); see also Van Dusen v. Barrack, 376 U.S. 612, 634 (1964) ("Although both sections were broadly designed to allow transfer instead of dismissal, [§] 1406(a) provides for transfer from forums in which venue is wrongly or improperly laid, whereas, in contrast, [§] 1404(a) operates on the premises that the plaintiff has properly exercised his venue privilege.").

B. Venue Is Not Proper In the Eastern District of California As To 13 Defendants Here, plaintiff has not met her burden to demonstrate that the Eastern District of California is a proper venue for this action. Before turning to the specific provisions of 28 U.S.C. § 1391(b) and 18 U.S.C. § 1965(a), the undersigned sets forth the residence or citizenship information about the parties, as presented by the Second Amended Complaint and other affidavits and declarations filed in this case. As an initial matter, plaintiff alleges that she is a resident of Sacramento County, California, who previously resided in the State of Maryland. (Second Am. Compl. ¶ 1, 10.) None of the other defendants is alleged to be a resident or citizen of California. Because of the number of named defendants, the undersigned provides the following table summarizing information relevant to the venue inquiry:

Defendant General Role In The Conspiracy Residence/Citizenship Information Barbara Plaintiff alleges that Allan is Plaintiff alleges that at the time of the Allan plaintiff's aunt, and that, among conspiratorial events in question, other things, Allan encouraged Allan's listed address was "111 Seville plaintiff to "agree with the 'deal'" Blvd, Sayville, NY 11782." (Second regarding the sale of the property Am. Compl. ¶ 17.) A declaration filed and to "'work something out with by Allan with her motion to dismiss for [plaintiff's] dad.'" improper venue states, among other things, that Allan has lived at this address since 1974, has resided in New York since 1954, and has no personal or business interests in California. (See Allan Decl. at 1, Aug. 10, 2011, Dkt. No. 72.)

Mike Plaintiff alleges that Carroll is a real Plaintiff does not allege an address for Carroll estate broker with Marketplace Carroll in her pleading. However, Realty, the firm that facilitated the plaintiff alleges that Carroll works for sale of the property in question. Marketplace Realty, which has an (Second Am. Compl. ¶ 19.) address for service of process at "3 Sunset Avenue, Westhampton Beach[,] New York 11978." (Second Am. Compl. ¶ 19.) Additionally, documents filed by plaintiff ...

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