The opinion of the court was delivered by: CHARLES KOCORAS, District Judge
This matter comes before the court on Defendant Eikenberry &
Associates, Inc.'s ("Eikenberry") motion to transfer. For the
reasons set forth below, the motion is denied.
Eikenberry is a corporation based in Kokomo, Indiana that is in
the business of molding plastics products. In either 1984 or
1985, Eikenberry entered into a relationship with Stephen Gulyas,
President of Illinois-based and incorporated Plaintiff S.J.G.
Enterprises, Ltd. ("SJG") whereby SJG would represent Eikenberry
as a sales agent. From that time until the beginning of 2000, the
relationship continued without incident with SJG soliciting orders for Eikenberry and being
compensated on a commission basis. By the end of 2003, a
significant dispute arose between the parties concerning the
purported nonpayment of commissions owed by Eikenberry to SJG.
While the parties initially attempted to resolve their
differences on their own, by the beginning of 2004 negotiations
had broken down and SJG had threatened to sue Eikenberry in
Illinois. In anticipation of this lawsuit, Eikenberry filed suit
on January 16, 2004, in the Circuit Court of Howard County,
Indiana. Eikenberry's complaint sought a declaratory judgment
concerning the terms of its relationship with SJG, the applicable
law governing the dispute, and the amount owed to either party.
While Eikenberry's counsel mailed a copy of the complaint and
summons to SJG's counsel on January 16, 2004, Eikenberry was not
able to properly effectuate service on SJG until March 4, 2004,
when the complaint and summons were delivered to Gulyas' wife.
On February 18, 2004, SJG filed a complaint against Eikenberry
in this court, seeking an accounting and alleging violations
under the Illinois Sales Representative Act, 820 ILCS 120/0.01
et seq, with Eikenberry being served on February 20. The
subject matter of the two lawsuits is nearly identical.
Eikenberry then filed a motion to stay or dismiss the action in
this court, which we denied as moot because the Indiana action
had been removed to federal court in the Southern District of
Indiana. On May 25, 2004, the Southern Indiana District Court denied
Eikenberry's motion to remand Eikenberry now moves to transfer
this case for consolidation with the previously filed action
pending in the Southern District of Indiana.
Eikenberry first suggests that we should transfer this case to
the Southern District of Indiana pursuant to the "first to file
rule," which generally favors the forum of the first-filed suit.
See Schwarz v. National Van Lines, Inc., 317 F. Supp. 2d 829,
832-33 (N.D. Ill. 2004). Under this rule, a district court has
the discretion to transfer a suit that "is duplicative of a
parallel action already pending in another federal court."
Serlin v. Arthur Andersen & Co., 3 F.3d 221, 223 (7th Cir.
1993) (citations omitted). However, the Seventh Circuit has never
rigidly adhered to the "first to file" rule. Trippe Mfg. Co. v.
American Power Conservation Corp., 46 F.3d 624, 629 (7th Cir.
1995). As Judge St. Eve has noted, courts will not enforce the
rule when the first filed action was an "improper anticipatory
filing" made for the purpose of forum shopping. Schwarz at 833.
In particular, the rule cannot be permitted to allow a potential
defendant to dictate the forum by filing "mirror image"
declaratory judgement actions "brought in the face of clear
threats of suit and seeking determinations that no liability
exists." Id. By July 15, 2003, SJG's counsel had expressed to Eikenberry
that if its dispute with SJG over commissions could not be
resolved, SJG felt entitled to relief under the Illinois Sales
Representatives Act, including the statute's provisions for
treble damages. Both parties affirm that by January 2004, their
negotiations had broken down and that litigation appeared
imminent. On January 16, 2004, Eikenberry filed the Indiana
complaint seeking a declaratory judgment as to the applicable law
governing its commissions dispute and to the amounts owed to
either party. The complaint states that SJG is wrongfully
claiming entitlement to commissions and acknowledges that SJG had
"threatened to file a lawsuit seeking additional compensation."
Eikenberry's Indiana action is precisely the type of mirror-image
declaratory relief claim, brought in anticipation of litigation
with the intent to preempt the plaintiff's choice of forum, to
which the "first to file" rule does not apply. We accordingly
will not transfer the present case to Indiana on first to file
grounds. However, we must also determine whether transfer is
appropriate pursuant to 28 U.S.C. § 1404(a) ("Section 1404(a)").
Section 1404(a) provides that "[f]or 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." The decision to transfer an action is within the sound discretion of the trial court. Coffey
v. Van Dorn Iron Works, 796 F.2d 217, 219 (7th Cir. 1986). The
party seeking transfer bears "the burden of establishing, by
reference to particular circumstances, that the transferee forum
is clearly more convenient." Id. at 219-20. In order to
succeed, the moving party must demonstrate that (1) venue is
proper in the transferor district, (2) the transferee court is in
a district where the action may have originally been brought, and
(3) transfer is for the convenience of the parties and will serve
the interests of justice. Bukhari v. American Express Travel
Related Services, 2002 WL 385561, *1 (N.D. Ill. 2002) (citing
Heller Financial, Inc. v. Midwhey Powder Co., Inc.,
883 F.2d 1286, 1293 (7th Cir. 1989)). As the parties do not dispute that
venue is proper here and that the suit could have originally been
brought in the Southern District of Indiana, we will limit our
analysis to whether transfer would be more convenient for the
parties and serve the interests of justice.
In analyzing whether transfer would be for the convenience of
the parties and in the interest of justice, the court must first
examine five factors relating to convenience: (1) the plaintiff's
choice of forum, (2) the locations of the material events, (3)
the relative ease of access to sources of proof in each forum,
(4) the convenience of the parties, and (5) the convenience of
the witnesses. Bukhari at *1 (citing Amoco Oil Co. v. Mobil
Oil Corp., 90 F. Supp. 2d 958, 960 (N.D. Ill. 2000)). A plaintiff's choice of forum is entitled to substantial weight
when making a Section 1404(a) determination, particularly when
the transferor court sits in the plaintiff's home district.
Schwarz, 317 F. Supp. 2d at 835. On the other hand, where the
plaintiff's chosen forum is not the plaintiff's home or the
location of material events, the plaintiff's choice is entitled
less deference. Id. For this reason, courts will often discuss
the choice of forum and location of material events factors
In the present case, SJG is based in Barrington, Illinois,
within the Northern District. There exists pointed disagreement
between the parties as to where the material events took place.
SJG contends that the events at issue arose in Illinois,
including the formation of its sales commission contract with
Eikenberry as well as the contract's performance and breach.
Namely, SJG states that Eikenberry retained SJG's services in
Illinois, SJG sold on behalf of Eikenberry only in Illinois and
Michigan, and that no aspects of SJG's duties related to Indiana.
For its part, Eikenberry claims that the commissions contract was
negotiated and executed at its office and plant in Kokomo, not in
Illinois. Eikenberry further avers that SJG's orders were
processed, billed, and coordinated in Kokomo, where most of
Eikenberry's production took place.
Because the record does not conclusively demonstrate that the
majority of relevant events took place in either Illinois or
Indiana, and the important factual issue of where the contract
was formed remains in dispute, the location of material events factor is not dispositive. However, the deference afforded to
SJG's choice when suing in its home forum supports keeping the
The next factor looks to the relative ease of access to sources
of proof. Since this action calls for an accounting of sales and
commissions over a four-year period, neither party suggests that
the documentary record will be voluminous.*fn1 As the only
other sources of proof that the parties plan on introducing at
trial will be in the form of ...