Britvan v. Cantor Fitzgerald L.P.

          ORDER GRANTING DEFENDANTS’ MOTION TO TRANSFER [12]

          OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         Plaintiffs Lawrence Britvan and his current employer HWE California, Inc. (HWE) filed this action for declaratory relief against Britvan’s former employer, Defendant Cantor Commercial Real Estate Sponsor, L.P. (“CCRES”)^[1] and other related entities, Defendants Cantor Fitzgerald, L.P. (“CFLP”) and Cantor Commercial Real Estate Company (“CCREC”) (collectively, Defendants). (Complaint (“Compl.”), ECF No. 1-1.) CCRES now moves to transfer the matter to the Southern District of New York pursuant to 28 U.S.C. § 1404. (Mot. to Transfer (“Mot.”), ECF No. 12.) Based on a valid arbitration forum selection clause and in the interest of justice, the Court GRANTS CCRES’s Motion to Transfer.^[2]

         II. BACKGROUND

         This declaratory judgment action arises from a New York employment contract between Britvan, a highly paid executive and lawyer, and his former New York-based employer, CCRES. For five years, Britvan was a resident of New York, working for CCRES in New York City under a September 8, 2010 Employment Agreement that: 1) was negotiated in New York by New York lawyers, 2) was signed in New York, 3) is governed by New York law, and 4) contains an arbitration provision that requires “any disputes, differences or controversies under [the] Agreement” to be adjudicated by a panel of arbitrators sitting in New York City. (Declaration of Lori Pennay (“Pennay Decl.”) ¶¶ 6-13; Pennay Decl. Ex. A (“Employment Agreement” §§ 8, 10).)

         Britvan resigned from his employment with CCRES on September 30, 2015. (Pennay Decl. ¶ 30.) Immediately thereafter, CCRES sent to Britvan’s New York apartment non-compete payments, as provided for in the contract, which now total $375, 000. (Id.)

         Britvan moved to California to take a job with HWE (an alleged competitor of CCRES) beginning on May 6, 2016. (Declaration of Lawrence Britvan (“Britvan Decl.”) ¶ 5.) On May 9, 2016, Britvan and HWE filed the subject declaratory judgment action in Los Angeles County Superior Court to strip from the employment agreement its covenant not to compete, its covenant not to solicit, and its mandatory arbitration provision. (Compl. ¶¶ 44-58.)

         The Complaint names as defendants CCRES, as well as two non-parties to the Employment Agreement, CFLP and CCRE. (Id. ¶¶ 10-15.) Plaintiff HWE is also not a party to the Employment Agreement.

         On May 11, 2016, Plaintiffs filed in Los Angeles County Superior Court an Ex Parte Application for Temporary Restraining Order and Order to Show Cause Re: Preliminary Injunction, which sought to temporarily enjoin the Defendants from enforcing the provisions that Plaintiffs sought to invalidate. (Declaration of David A. Paul “Paul Decl.” ¶ 8.) The court denied Plaintiffs’ request for a TRO and scheduled a hearing on their Motion for Preliminary Injunction. (Id. ¶ 9.)

         On May 20, 2016, CCRES filed a special proceeding in New York Supreme Court, seeking an order, inter alia, a) declaring that New York law applies to the Employment Agreement and that the arbitration clause of the Employment Agreement is valid and binding on Britvan; b) compelling arbitration of any disputes arising under the Employment Agreement; and c) enjoining prosecution of the Declaratory Judgment Action. (Id.¶ 10, Ex. 2)

         That same day, after receiving argument from CCRES and Britvan (who appeared through counsel and did not contest the court’s jurisdiction), the court granted CCRES a temporary restraining order which enjoined prosecution of the Declaratory Judgment Action pending a further hearing on CCRES’s application. (Id. ¶ 11, Ex. 3.) In a court-supervised mediation on June 6, 2016, Plaintiffs state that Judge Joan Kenney verbally indicated to the parties her intent to issue an order requiring that Britvan arbitrate all claims raised in the Declaratory Judgment Action before a panel in New York. (Id.) The parties have fully briefed the New York Action, and await the court’s decision and order. (Id.)

         On June 8, 2016, prior to the preliminary injunction hearing in the Declaratory Judgment Action, CCRES (with the consent of CFLP and CCRE) timely removed the case to this Court on the grounds that there is complete diversity between Britvan and CCRES. (Notice of removal (“NOR”), ECF No. 1.)

         On June 20, 2016, CCRES filed a demand for arbitration with the American Arbitration Association.

         CCRES now moves to transfer the Declaratory Judgment Action to the Southern District of New York. The Motion is before the Court for consideration.

         III. LEGAL STANDARD

         Pursuant to 28 U.S.C. § 1404(a), a district court may transfer an action to any district or division “where the action might have originally been brought” in order to promote the convenience of the parties and witnesses and the interests of justice. A district court must make two findings: 1) the transferee court is one where the action “might have been brought, ” and 2) the parties’ and witnesses’ conveniences, as well as the interests of justice, favor transfer. Metz v. U.S. Life Ins. Co., 674 F.Supp.2d 1141, 1145 (C.D. Cal. 2009); see also Hatch v. Reliance Ins. Co., 758 F.2d 409, 414 (9th Cir. 1985). This provision under 28 U.S.C. § 1404(a) “gives a district court broad discretion to transfer a case to another district where venue is also proper.” Amini Innovation Corp. v. JS Imports, Inc., 497 F.Supp.2d 1093, 1108 (C.D. Cal. 2007) (footnote omitted); s ...