Delaware Business Litigation Report

District Court Denies Motion to Transfer

Rimmax Wheels LLC v. RC Components, 2007 WL 81829 (D.Del. Jan. 9, 2007)

In this order denying Defendant’s motion to transfer venue, the District Court reviewed the applicable standards and guidelines employed to evaluate motions to transfer. Plaintiff, a Delaware limited liability company holding patents for motorcycle rims, sued Defendant, a Kentucky corporation engaged in the manufacturing of motorcycle rims, for breach of contract, fraud, and intentional interference with contractual relations. Defendant moved for transfer of venue to the Western District of Kentucky, contending that it was the locale of the parties’ contractual negotiations, Defendant’s business, and two essential witnesses who refused to appear in Delaware to testify. After reviewing the standards developed by the U.S. Supreme Court, Third Circuit Court of Appeals, and District Court of Delaware, the court denied Defendant’s motion to transfer, finding that Delaware had a substantial connection to the case.

The Court stated that in passing the legislation authorizing the district court to transfer civil actions to another district for the convenience of the parties and witnesses and in the interests of justice, Congress granted discretion to the courts to adjudicate motions to transfer on a case-by-case basis. The burden of establishing need to transfer is on the moving party, and the plaintiff’s choice of forum is given deference as long as it was selected for a legitimate reason. The Court reviewed several potential factors identified by the Third Circuit as relevant to determination of motions to transfer and serving private or public interests. The Court then concluded that because Plaintiff was a Delaware limited liability company, the contract at issue provided for the application of Delaware law, and Defendant sold its products through Delaware dealers, Delaware had a “substantial connection” to the case. The Court rejected Defendant’s argument that key witnesses would be unavailable for trial in Delaware, stating that “[t]rial testimony is as often comprised of recorded depositions as it is of witnesses appearing live to testify.” The Court therefore declined to transfer the case to Kentucky.

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