United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
JOHN W. DARRAH, District Judge.
Plaintiff Polsinelli PC ("Polsinelli") has brought this action to recover unpaid legal fees against Defendants Genesis Biosciences, Inc. ("Genesis") and CKM Holdings, Inc. ("CKM"). Defendants have moved to transfer this case to the Northern District of Georgia, pursuant to 28 U.S.C. § 1404(a).
For purposes of a motion to transfer, all well-pleaded allegations in the complaint are accepted as true unless controverted by affidavit. Plotkin v. IP Axess, Inc., 168 F.Supp.2d 899, 900 (N.D. Ill. 2001). Polsinelli is a large, Missouri-based law firm with offices nationwide, including a Chicago office and a recently opened Atlanta office. Genesis is a Georgia limited liability corporation, and CKM is Delaware corporation; both have their principal place of business in Lawrenceville, Georgia. This dispute centers on legal work performed by Polsinelli for Defendants on a variety of matters, including corporate, employment, environmental and litigation issues. This work was performed primarily by Polsinelli from its Chicago office, but attorneys in its Kansas City, Phoenix, and St. Louis offices also were involved. (Compl. ¶¶ 1-4, 8.)
The history of the parties goes back to 2001, when Conrad Mielcuszny, a Wisconsin resident at the time, retained attorney Anthony Nasharr, who was, at that time, working for a different Chicago law firm. ( See Pl's Resp. Br., Exh. A, Nasharr Declaration ("Nasharr Decl.") ¶ 4.) Nasharr represented Mielcuszny in his creation of his company Biotal Technologies, LLC ("Biotal"), a Wisconsin company, and continued to work on Biotal matters until 2012. ( Id. ¶¶ 4, 6.) Between 2001 and 2007, Mielcuszny frequently visited and conferred with Nasharr in the Chicago area. ( Id. ¶ 7.) In approximately 2005, Mielcuszny moved, along with his business operations of Biotal, from Wisconsin to the Atlanta, Georgia area. ( Id. ¶ 8.) In 2006, Nasharr joined the law firm of Polsinelli as a shareholder and brought Mielcuszny's business with him. ( Id. ¶ 5.)
In 2007, Mielcuszny requested that Nasharr and Polsinelli represent him in his business's acquisition of Genesis Technologies International, Inc. ("Genesis Technologies"), a Georgia company. ( Id. ¶ 9.) Nasharr performed all the legal services for Mielcuszny and Biotal from his Chicago law office. In a 2008 "Executive Summary" prepared about Biotal for potential lenders, Nasharr was described as Biotal's "general counsel" and listed in Chicago. ( Id. ¶¶ 13-14.)
At Mielcuszny's request, Nasharr and his Polsinelli colleagues incorporated a new company that was wholly owned by Mielcuszny, Defendant CKM, in order to purchase Genesis Technologies; Nasharr likewise performed that legal work from his Chicago office. ( Id. ¶ 15.) A Polsinelli attorney from Kansas City drafted the acquisition documents. (Defs.' Reply Br., Exh. A, Nasharr Dep. 32:24-33:5.) The closing of the acquisition took place in Lawrence, Georgia in June 2008, which Nasharr attended. (Nasharr Decl. ¶ 16.) After the acquisition, Nasharr provided the legal services, from Chicago, to change the name of the company to Genesis. ( Id. ¶ 17.) Nasharr, along with several other Chicago lawyers, continued to provide legal services for Defendants on a variety of matters. Nasharr visited Genesis's headquarters in Georgia twice. ( Id. ¶ 18.)
After the acquisition, Mielcuszny voiced concerns about the equipment and facilities purchased from Genesis Technologies, particularly about two large, pressurized fermentation tanks that had not been completed at the time of closing. ( Id. ¶¶ 24-25.) In late 2009, Mielcuszny conferred with Nasharr about defenses to avoid payment on two promissory notes that were guaranteed by him as part of the financing of the purchase of Genesis Technologies. The promissory notes, which totaled $2 million, were owed to the former principals of Genesis Technologies, John Kubiak and Lee Hanson. ( Id. ¶ 21.) As a result, Nasharr and two Chicago Polsinelli litigators, Anthony Porcelli and Paula Kim, began a factual investigation and legal analysis of possible defenses that continued through 2010; the focus of that work then turned to negotiations in June 2010. Mielcuszny met with the Polsinelli attorneys twice in Chicago in 2010. ( Id. ¶¶ 26-27; see also Porcelli Decl. ¶¶ 5-7.) Thomas Tate of the law firm of Andersen, Tate & Carr P.C. ("Andersen Tate") was retained by Mielcuszny and Genesis to act as local counsel in Georgia, while Polsinelli continued to be the lead attorneys. (Porcelli Decl. ¶ 9.)
After those negotiations failed, Kubiak and Hansen sued Mielcuszny in Georgia state court in February 2011, seeking $2 million for failure to pay on the promissory notes. Mielcuszny engaged Polsinelli, specifically Nasharr and Porcelli, to represent him in defense of that matter, as well as to bring a separate lawsuit against Kubiak and Hansen in Georgia on behalf of CKM. (Nasharr Decl. ¶ 29; Pl's Resp. Br., Exh. B., Porcelli Declaration ("Porcelli Decl.") ¶ 10.) Polsinelli had the lead role on this litigation, the majority of which was conducted out of the Chicago office. Porcelli made two overnight trips to Georgia, one of which was to argue summary judgment motions, while Kim made one overnight trip to Georgia. (Porcelli Decl. ¶ 7.) Hansen and Kubiak were subsequently awarded summary judgment against Mielcuszny regarding the promissory notes in October 2011. (Porcelli Decl. ¶ 12.)
In approximately September 2011, Defendants stopped paying Polsinelli's legal bills. In approximately late 2011, Polsinelli was informed that Andersen Tate would be taking over as lead counsel. Polsinelli ceased working on Defendants' matters on or about February 28, 2012, and sent the last legal bill to Defendants on or about March 31, 2012. Polsinelli alleges that Defendants owe it approximately $333, 003.02, plus interest, for unpaid legal services. (Compl. ¶¶ 18-20.) Polsinelli's Complaint asserts two counts against Defendants; Count I is for breach of contract, and Count II is for quantum meruit. Defendants have filed an Answer that asserts affirmative defenses and counterclaims for malpractice and breach of fiduciary duty against Polsinelli.
Defendants have moved to transfer this matter to the Northern District of Georgia, arguing that it is a more convenient venue. Polsinelli was granted leave to file supplemental memoranda, and the matter has been fully briefed.
Under 28 U.S.C. § 1404(a), a district court may transfer any civil action "[f]or the convenience of parties and witnesses, in the interest of justice... to any other district or division where it might have been brought." 28 U.S.C. § 1404(a). Therefore, a transfer of venue is appropriate when: (1) venue is proper in both the transferor and transferee courts; (2) a transfer will better serve the convenience of the parties and the witnesses; and (3) a transfer will better serve the interest of justice. Coffey v. Van Dorn Iron Works, 796 F.2d 217, 219 (7th Cir. 1986). The moving party bears the burden of establishing all three elements, including showing that the movant's venue is "clearly more convenient" than remaining in the plaintiff's initial choice of venue. Body Sci. LLC v. Boston Sci. Corp., 846 F.Supp.2d 980, 991 (N.D. Ill. 2012) (quoting Coffey, 796 F.2d at 219-20). The decision whether to transfer a case is "committed to the sound discretion" of the district court. Coffey, 796 F.2d at 219. As such, the district court will decide a motion to transfer on a case-by-case ...