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Central States, Southeast and Southwest Areas Pension Fund v. Bergquist

United States District Court, N.D. Illinois, Eastern Division

February 22, 2018

CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, and ARTHUR H. BUNTE, JR., Plaintiffs,
v.
ROBERT V. BERGQUIST, Defendant.

          MEMORANDUM OPINION AND ORDER

          Harry D. Leinenweber, Judge United States District Court.

         Before the Court is Defendant Bergquist's Motion for Change of Venue due to Forum Non Conveniens Pursuant to Section 1404 [ECF No. 13]. For the reasons stated herein, the Court denies Bergquist's Motion.

         I. BACKGROUND

         Central States, Southeast and Southwest Areas Pension Fund and one of its trustees, Arthur H. Bunte, Jr. (collectively, the “Fund”), brought suit against Robert V. Bergquist (“Bergquist”), alleging certain transfers from his former company were made to evade or avoid withdrawal liability in violation of Section 1392(c) of Employee Retirement Income Security Act of 1974, as amended by the Multiemployer Pensions Plan Amendments Act of 1980 (hereinafter, “ERISA”), 29 U.S.C. § 1001 et seq., and in violation of Michigan's Uniform Fraudulent Transfer Act, Mich. Comp. Laws § 566.31 et seq.

         Defendant Bergquist was the officer and director of Genesee-Bay Constructors Inc. (“Genesee-Bay”), a Michigan corporation. (Compl. ¶ 23.) Genesee-Bay was bound by a collective bargaining agreement to make contributions to the Fund. (Id. ¶ 10.) In January 2005, Bergquist sold all his interest in Genesee-Bay back to the company and resigned as officer and director by entering into a Stock Redemption Agreement where Genesee-Bay agreed to pay Bergquist $750, 000 pursuant to a promissory note for his ownership interest. (Id. ¶¶ 24-26.) In June 2011, Genesee-Bay effected a “complete withdrawal” from the pension fund, resulting in a withdrawal liability to the Fund under ERISA, none of which was paid and remains outstanding to date. (Id. ¶¶ 11-14.) On August 15, 2014, Genesee-Bay assigned all its assets to Bergquist, allegedly to pay on the promissory note executed in 2005. (Id. ¶ 50.) A few weeks later, the Fund obtained a judgment of $232, 720.51 against Genesee-Bay for withdrawal liability under ERISA. (Id. ¶¶ 16, 51.) The Fund brings this action, alleging that Genesee-Bay assigned its assets to Bergquist to avoid paying its withdrawal liability in violation of ERISA and Michigan's Uniform Fraudulent Transfer Act. (Id. ¶¶ 54-62.)

         The crux of this Motion is not about the merits of the lawsuit, but about where the lawsuit should take place. Bergquist resides in Arenac County, Michigan, which lies within the jurisdiction of the District Court of the Eastern District of Michigan. (Answer ¶ 5.) The Fund is administered in Rosemont, Illinois, which lies within the jurisdiction of the Eastern Division of the Northern District of Illinois. (Compl. ¶ 3.) Bergquist moves to transfer this case to the Eastern District of Michigan due to forum non conveniens pursuant to 28 U.S.C. § 1404.

         II. DISCUSSION

         A. Transfer under Section 1404

         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.” 28 U.S.C. § 1404(a). Transfer under § 1404(a) is appropriate if (1) venue is proper in both the transferor and transferee court; (2) transfer is for the convenience of the parties and witnesses; and (3) transfer is in the interest of justice. See, id.

         1. Proper Venue

         The parties agree that venue is proper in both the Northern District of Illinois, where the Fund is administered, and the Eastern District of Michigan, where Bergquist resides. See, 29 U.S.C. § 1132(e)(2). Thus, resolution of Bergquist's Motion therefore turns on the last two factors-convenience and the interest of justice.

         2. Convenience Factors

         The convenience analysis considers five factors: “(1) the plaintiff's choice of forum; (2) the situs of the material events; (3) the relative ease of access to sources of proof; (4) the convenience of the witnesses; and (5) the convenience of the parties.” Cent. States, Se. & Sw. Areas Pension Fund (“Cent. States”) v. Ehlers Dist. Inc., No. 11 C 2691, 2012 WL 581246, at *2 (N.D. Ill. Feb. 22, 2012) (citation omitted). Because Section 1404(a) does not specify the weight to be accorded each factor, whether to grant a motion to transfer is left to the discretion of the court. Heller Fin., Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1293 (7th Cir. 1989). However, it is inappropriate to transfer a case if doing so would have no effect other than to shift the inconvenience from one party to the other. Fink v. Declassis, 738 F.Supp. 1195, 1198 (N.D. Ill. 1990). The Court considers each factor in turn.

         a. ...


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