United States District Court, M.D. Alabama, Northern Division
MEMORANDUM OPINION AND ORDER
F. MOORER UNITED STATES MAGISTRATE JUDGE
action is assigned to the undersigned magistrate judge to
conduct all proceedings and order entry of judgment by
consent of all the parties (Docs. 17-19, filed 9/1/16) and 28
U.S.C. § 636(c). Pending before the Court is
Plaintiffs' Motion to Remand (Doc. 7, filed
11/4/17) and Defendant's Motion to Dismiss or, In the
Alternative, to Transfer (Doc. 6, filed 11/3/17). The
motions have been fully briefed and are ripe for review.
Having considered the motions and relevant law, the Court
finds the motion to remand is due to be DENIED. Further, the
Court finds that the Alternative Motion to Transfer Venue
(Doc. 6) is due to be GRANTED in part and DENIED in part.
This case shall be transferred to the Northern District of
Alabama - Northeastern Division pursuant to 28 U.S.C. §
1404(a) and the remaining motions to dismiss shall be held in
abeyance pending transfer to the new Court.
Facts and Procedural History
Eric Cisney and Kerri Cisney (collectively
“Plaintiffs” or “Cisneys”) filed this
a complaint in the Circuit Court of Montgomery County,
Alabama on September 28, 2017. See Doc. 1, Atch 1,
Complaint. Both Cisneys are Alabama citizens. The suit
asserted four separate counts - Declaratory Judgment,
Conversion, Wantonness, and Legal Malpractice. The
allegations are against Robert Grey Johnson
(“Defendant” or “Johnson”) who was
Plaintiffs' original lawyer in the underlying auto
accident lawsuit. Johnson is a licensed attorney in the
State of California. Around July 17, 2015, the Cisneys were
in an accident while in Riverside County, California.
Specifically, Eric Cisney was injured while a passenger in a
fire truck owned by the Riverside County Fire Department.
After the accident, the Cisneys signed a contingency fee
agreement with Defendant Johnson during the representation of
the lawsuit that followed.
first settlement from the at-fault party's insurance
carrier occurred around April/May 2016. The settlement was
for policy limits. Afterwards, Defendant (on behalf of
Plaintiffs) pursued an underinsured motorist
(“UIM”) claim from the Plaintiffs' insurance
carrier, Metropolitan Property and Casualty Insurance Company
(“Met”). Around June 2016, Met filed a
declaratory judgment action in federal court wherein it
asserted that it had no duty to pay the UIM claim because
Plaintiffs and Defendant Johnson failed to give it notice of
the proposed auto accident settlement and further failed to
secure Met's consent to the settlement terms as required
by the insurance contract (“declaratory judgment
action). Consequently, Defendant retained a local law firm
Balch & Bingham to serve as local counsel on the UIM
claim against Met and to defend in the Met declaratory
judgment case. Plaintiffs assert that both before and after
retaining local counsel, Defendant still advised on the UIM
claim by providing legal advice and recommendations to
Plaintiffs including selection of an arbitrator, date, and
preparation of the arbitration action in Alabama.
about August 1, 2017, Plaintiffs terminated Defendants'
services for cause and retained new counsel. On or about
September 22, 2017, the UIM claim was resolved by agreement
with MET for policy limits of $500, 000.00 and the proceeds
deposited into the new counsel's trust account. Defendant
sent notice that he claimed attorney's lien on proceeds
payable from the UIM settlement in the amount of $175, 338.00
(“the lien”). The proceeds are still withheld
until the matter resolved. See Doc. 1, Atch 3,
Complaint. On September 28, 2017, Plaintiffs filed their
lawsuit in the Circuit Court of Montgomery County, Alabama.
Id. Plaintiffs request (1) declaratory judgment that
the lien is subject to Alabama law and is unenforceable, (2)
conversion, (3) wantonness, and (4) legal malpractice.
Id. at p. 3-5. Plaintiffs seek the declaratory
judgment on the lien and compensatory and punitive damages in
the amount of $50, 000.00. Id. at p. 5.
October 6, 2017, Defendant Johnson initiated his own case in
the Central District of California federal court.
See Doc. 23 at p. 3. He asserts his own claim for
declaratory relief and for breach of the contingency fee
agreement. Id. Then on October 18, 2017, Defendant
Johnson filed a Notice of Removal in this Court based on an
assertion of diversity jurisdiction for the case originally
brought by the Cisneys in Alabama state court. See
Doc. 1, generally. Defendant states in the Notice of Removal
that the case is properly removable under 28 U.S.C.
§1441 because the United States District Court now has
original jurisdiction over this case under 28 U.S.C.
§1332. Specifically, Defendant asserts diversity
jurisdiction exists in this case because the amount in
controversy exceeds the $75, 000 jurisdictional threshold and
complete diversity of citizenship exists among the parties.
Plaintiffs are citizens of Alabama. Defendant is a citizen of
after removal, Defendant filed his motion to dismiss and
alternative motion to transfer venue. See Doc. 6. In
the motion, Defendant asserts he is not subject to an Alabama
malpractice claim. Id. at p. 2-3. He alternatively
argues that the claims should be transferred to either the
Northern District of Alabama or California federal court.
Id. at 3-6. He also argues first-to-file with regard
to California and argues this lawsuit was filed after his
case filed in California. Id. at p. 5-6.
November 4, 2017, Plaintiffs timely filed their motion to
remand in this case. See Doc. 7. Plaintiffs make the
argument that the claim for declaratory judgment is not a
claim for money. They merely seek the declaration that the
attorneys' fee lien is invalid. Defendant filed its
response arguing that “[t]he idea that there is any
material separation between declaring a monetary lien invalid
versus actually awarding a sum to a party is ridiculous and,
at minimum, insufficient to have this case remanded to the
Circuit Court in which the action was erroneously
filed.” See Doc. 14 at p. 2. On November 30,
2017, Plaintiffs timely responded to Defendant's motion
to dismiss and alternative motion to transfer venue.
See Doc. 17.
on January 5, 2018, the court in the Central District of
California entered an order denying a motion to dismiss in
its court, but stayed its case pending resolution by this
Court. See Doc. 23, Copy of Order. Further, the
California federal court makes the judicial finding that the
Cisneys' case was the first filed. Id. at p.
review of the various pleadings, motions, and responses, the
Court determines the issues are fully briefed and no oral
arguments are necessary. The motions are ripe for review.
Standards of Review
courts have a strict duty to exercise jurisdiction conferred
on them by Congress. Quackenbush v. Allstate Ins.
Co., 517 U.S. 706, 716, 116 S.Ct. 1712, 1720, 135
L.Ed.2d 1 (1996). However, federal courts are courts of
limited jurisdiction and possess only that power authorized
by Constitution and statute. Kokkonen v. Guardian Life
Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673,
1675, 128 L.Ed.2d 391 (1994); Burns v. Windsor Insurance
Co., 31 F.3d 1092, 1095 (1994). Defendant, as the party
removing this action, have the burden of establishing federal
jurisdiction. See Leonard v. Enterprise Rent a Car,
279 F.3d 967, 972 (11th Cir. 2002) (citing Williams v.
Best Buy Co., 269 F.3d 1316, 1318 (11th Cir. 2001)).
Further, the federal removal statutes must be construed
narrowly and doubts about removal must be resolved in favor
of remand. Allen v. Christenberry, 327 F.3d 1290,
1293 (11th Cir. 2003) (citing Diaz v. Sheppard, 85
F.3d 1502, 1505 (11th Cir. 1996)); Burns, 31 F.3d at
1095 (citations omitted).
12(b)(3) of the Federal Rules of Civil Procedure provides
that a party may assert a defense of improper venue by
motion. Pursuant to § 1391(b), venue is proper in:
(1) a judicial district in which any defendant resides, if
all defendants are residents of the State in which the
district is located;
(2) a judicial district in which a substantial part of the
events or omissions giving rise to the claim occurred, or a
substantial part of property that is the subject of the
action is situated; or (3) if there is no district in which
an action may otherwise be brought as provided in this
section, any judicial district in which any defendant is
subject to the court's personal jurisdiction with respect
to such action.
28 U.S.C. § 1391(b). If venue is improper, the district
court “shall dismiss, or if it be in the interest of
justice, transfer such case to any district or division in
which it could have been brought.” 28 U.S.C. §
1406(a). The plaintiff carries the burden of showing that
venue is proper in the chosen forum once the defendant
contests venue under Rule 12(b)(3). Pritchett v. Paschall
Truck Lines, Inc., 714 F.Supp.2d 1171, 1174 (M.D. Ala.
reviewing a challenge to venue, the Court accepts the
allegations of the complaint “as true, to the extent
they are uncontroverted by defendants' affidavits.”
Delong Equip. Co. v. Wash. Mills Abrasive Co., 840
F.2d 843, 845 (11th Cir. 1988); see also Estate of Myhra
v. Royal Caribbean Cruises, Ltd., 695 F.3d 1233, 1239
(11th Cir. 2012) (stating same). The Court “may make
factual findings necessary to resolve motions to dismiss for
improper venue, ” so long as the resolution of the
factual disputes is not an adjudication on the merits of the
case. Bryant v. Rich, 530 F.3d 1368, 1376 (11th Cir.
2008). A court must draw all reasonable inferences and
resolve all factual conflicts in favor of the plaintiff.
Wai v. Rainbow Holdings, 315 F.Supp.2d 1261, 1268
(S.D. Fla. 2004). “Rule 12(b)(3) is a somewhat unique
context of dismissal in which we consciously look beyond the
mere allegations of a complaint, and, although we continue to
favor the plaintiff's facts in the context of any actual
evidentiary dispute, we do not view the allegations of the
complaint as the exclusive basis for decision.”
Estate of Myhra, 695 F.3d at 1239.
Failure to State a Claim
12(b)(6) motion to dismiss tests the legal sufficiency of the
complaint. Gilmore, 125 F.Supp.2d at 471. To survive
a motion to dismiss for failure to state a claim, the
plaintiff must allege “enough facts to state a claim to
relief that is plausible on its face.” Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct.
1955, 1974, 167 L.Ed.2d 929 (2007). In considering a
defendant's motion to dismiss, the “court must view
the complaint in the light most favorable to the plaintiff
and accept all the plaintiff's well-pleaded facts as
true.” Am. United Life Ins. v. Martinez, 480
F.3d 1043, 1057 (11th Cir. 2007) (citing St. Joseph's
Hosp. Inc. v. Hosp. Corp. of Am., 795 F.2d 948, 954
(11th Cir. 1986)). In other words, in deciding a 12(b)(6)
motion to dismiss, the court will accept the petitioner's
allegations as true. Hishon v. King & Spalding,
467 U.S. 69, 73, 104 S.Ct. 2229, 2232, 81 L.Ed.2d 59 (1984);
Ellis v. General Motors Acceptance Corp., 160 F.3d
703, 706 (11th Cir. 1998); Roberts v. Florida Power &
Light Co., 146 F.3d 1305, 1307 (11th Cir. 1998) (citing
Lopez v. First Union National Bank of Florida, 129
F.3d 1186, 1189 (11th Cir. 1997)). However,
“[c]onclusory allegations, unwarranted deductions of
facts or legal conclusions masquerading as facts will not