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Deann O'donovan v. Western Health Care Corp

March 4, 2011


The opinion of the court was delivered by: Matthew F. Kennelly United States District Judge



Plaintiff DeAnn O'Donovan, an Illinois citizen, has sued Western Health Care Corp. ("Western") to recover a real estate broker commission she claims she earned from the sale of two senior health care facilities in Idaho. Western, an Idaho corporation, has moved to dismiss for lack of personal jurisdiction and improper venue or alternatively to transfer the case to the District of Idaho pursuant to 28 U.S.C. § 1404(a). Western has also moved to dismiss O'Donovan's claims for failure to state a claim. For the reasons set forth below, this Court grants Western's motion to transfer the case to the District of Idaho and therefore does not consider Western's other motions.

Factual Background

This case arises out of an alleged real estate brokerage agreement between O'Donovan and Western. In late 2008, O'Donovan contacted A. Rick Holloway ("Rick"), Western's president, via telephone to offer her real estate brokerage services regarding four senior health care facilities that Western managed and wished to sell. In January 2009, O'Donovan traveled from Illinois to Idaho to meet with Rick and his father A. Keith Holloway ("Keith"), a Western board member. During this visit, O'Donovan viewed the four facilities, which are located in Idaho.

Upon O'Donovan's return to Illinois, she exchanged numerous telephone calls and e-mails with the Holloways. Their discussions resulted in the execution of a representation agreement dated February 24, 2009 ("the Agreement"). Under the Agreement, Senior Living Investment Brokerage, Inc. ("Senior Living") was employed as "agent" for the sale of three properties. O'Donovan, who worked for Senior Living at the time, signed the Agreement on behalf of Senior Living. O'Donovan then faxed the Agreement to Keith, who signed as the "seller" (the Agreement did not identify Western on its face). O'Donovan alleges that the Holloways represented to her that Western owned the facilities and that Keith had the authority to sign the Agreement on the behalf of Western. Western contends that Keith did not sign the Agreement on the behalf of Western.

Under the Agreement, the seller agreed to pay the agent a commission equal to three percent of the purchase price of the property. Though the Agreement expired on August 24, 2009, the agent was still entitled to a commission if, within twelve months after that, the seller sold to a buyer that the agent had negotiated with or had brought into the picture. The Agreement required the agent to provide the seller with a list of prospective buyers. Western claims that O'Donovan failed to provide the required list. The Agreement contained an Idaho choice-of-law provision.

O'Donovan alleges that she worked to secure a buyer for the facilities for a period of about six months. She claims that she performed all of this work in Illinois. Specifically, O'Donovan says, she discussed the facilities via telephone, e-mail, and fax with several prospective buyers, including The Ensign Group, Inc. ("Ensign"), which is located in California. O'Donovan also says she exchanged with the Holloways numerous e-mails and telephone calls discussing offers from prospective buyers. O'Donovan contends that she received more than forty e-mails from the Holloways and had more than ten phone conferences with them. O'Donovan also says that the Holloways sent her detailed financial reports concerning the facilities, which she disseminated and explained to prospective buyers. Upon her request, the Holloways also sent her information regarding the facilities and their operations on several occasions.

Around March 24, 2009, O'Donovan left Senior Living. O'Donovan claims that Senior Living assigned her its rights and obligations under the Agreement. She alleges that she promptly notified Western of her departure from Senior Living and that Keith acknowledged this in an e-mail.

In late August 2009, Rick notified O'Donovan that Western no longer wished to sell the facilities. O'Donovan alleges that despite this, Western sold two of the facilities to Ensign in December 2009 for a total of $7.6 million. In May 2010, O'Donovan contacted the Holloways to request payment pursuant to the Agreement. Rick refused to pay O'Donovan, claiming that Western had introduced Ensign to O'Donovan and thus she had not procured the buyer, and that O'Donovan had failed to provide Western with the required list of prospective buyers under the Agreement.

In her amended complaint, O'Donovan asserts claims of breach of contract, breach of good faith and fair dealing, and unjust enrichment. Western has moved to dismiss pursuant to Federal Rules of Procedure 12(b)(2), (3), and (6), or in the alternative to transfer the case to the District of Idaho pursuant to 28 U.S.C. § 1404(a).


The Court will begin (and end) with Western's motion to transfer. Western has moved to transfer pursuant to 28 U.S.C. § 1404(a), which 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." Under section 1404(a), the party seeking transfer bears the burden of showing that "the transferee forum is clearly more convenient." Coffey v. Van Dorn Iron Works, 796 F.2d 217, 219-20 (7th Cir. 1986).

Section 1404(a) "operates on the premise[ ] that the plaintiff has properly exercised his venue privilege." Van Dusen v. Barrack, 376 U.S. 612, 634 (1964). Though Western has challenged the propriety of venue in this district, the Court will assume for purposes of discussion that, as O'Donovan argues, venue is proper here. The Court likewise need not address Western's challenge to personal jurisdiction, because a court need not have personal jurisdiction over a ...

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