United States District Court, S.D. Alabama, Southern Division
COMPUTER PROGRAMS & SYSTEMS, INC., AND TRUBRIDGE, LLC, Plaintiffs,
TEXAS GENERAL HOSPITAL and TEXAS GENERAL HOSPITAL -VZRMC, Defendants.
V. S. GRANADE SENIOR UNITED STATES DISTRICT JUDGE
matter is before the Court on Defendants, Texas General
Hospital and Texas General Hospital -VZRMC's, Motion to
Transfer Venue pursuant to 28 U.S.C. §1404(a). (Doc.
16). Plaintiffs, Computer Programs & Systems, Inc., and
TruBridge, LLC, have responded (Doc. 19), Defendants have
replied (Doc. 20), and with this Court's approval,
Plaintiffs have filed a Sur-Reply (Doc. 23). For the reasons
stated herein below, Defendants' Motion is hereby DENIED.
26, 2013, Syed I. Usman executed a “Master Services
Agreement” with Plaintiff on behalf of Texas General
Hospital. (Doc. 19 at 2). On March 30, 2015, Suleman Hashmi
executed a “Master Services Agreement”
(collectively the “Agreements”) with Plaintiff on
behalf of Texas General Hospital - VZRMC, LP. (Id.)
Both Agreements contain identical forum selection clauses
which state that “[t]his Agreement shall be construed
under the laws of the State of Alabama […] The
exclusive and sole venue for any action brought to enforce or
interpret this Agreement shall be the state and federal
courts situated in Mobile County, Alabama […].”
(Id.; Doc. 19-1 at 12, 23).
February 7, 2018, Plaintiffs Computer Programs & Systems,
Inc. (“CPSI”) and TruBridge, L.L.C.
(“TruBridge”) filed this action in the Circuit
Court of Mobile County, Alabama alleging two counts of breach
of contract based on the 2013 and 2015 Agreements. (Doc. 16
at 11-16). On March 12, 2018, Defendants filed a notice of
removal based on diversity jurisdiction. (Doc. 1). On March
19, 2018, Defendants filed an Answer and on March 22, 2018,
defendants filed an amended notice of removal and the subject
Motion to Transfer (Docs.7, 15, and 16). The Motion to
Transfer has been briefed and is ripe for review.
seek a transfer of this action to the Northern District of
Texas for forum non conveniens pursuant to 28 U.S.C.
§1404(a). (Doc. 16 at 3). In support of transfer,
Defendants point out that all of the Defendants are residents
of the Northern District of Texas, that a substantial part of
the events giving rise to this action occurred in Texas, that
trial of this action in Texas would be more convenient for
Defendants and any potential defense witnesses, and that
access to the relevant documents is easier in Texas.
(Id. at 5). Defendants additionally assert that it
is in the public's interest to transfer this action
because (1) the Northern District of Texas has more
magistrate and district judges than this Court, such that a
transfer of this action will lessen the administrative burden
on the court system and that (2) the events giving rise to
this action occurred in Texas and (3) the Alabama law
governing this action is not complicated. (Doc. 16 at 6; Doc.
20 at 3-5).
opposes a change of venue and argues that transfer is
improper because the contracts upon which this action is
based contain valid forum selections clauses restricting
venue to state and federal courts in Mobile, County,
Alabama.(Doc. 19 at 1). Accordingly, Plaintiffs
assert that Defendants have waived their right to challenge
venue based on forum non conveniens. (Id.
at 2-6). Moreover, Plaintiffs assert that the public interest
factors to be considered by this Court do not weight in favor
of a transfer of venue. (Doc. 23 at 5-8).
to transfer a case to another district is a matter within the
discretion of the court. Stewart Org., Inc. v. Ricoh
Corp., 487 U.S. 22, 29, 108 S.Ct. 2239, 2244, 101
L.Ed.2d 22 (1988). The federal change of venue statute
provides that the court may transfer a case to another
district in which it might have been brought in the interest
of justice or for the convenience of the parties or
witnesses. 28 U.S.C. § 1404(a). “In the typical
case not involving a forum-selection clause, a district court
considering a § 1404(a) motion (or a forum non
conveniens motion) must evaluate both the convenience of
the parties and various public-interest considerations.
[…] and decide whether, on balance, a transfer would
serve ‘the convenience of parties and witnesses'
and otherwise promote ‘the interest of
justice.'” Atlantic Marine Const. Co., Inc. v.
U.S. Dist. Court for W. Dist. Of Texas, 571 U.S. 49, 134
S.Ct. 568, 187 L.Ed.2d 487 (2013), quoting § 1404(a).
However, when the parties' contract contains a valid
forum-selection clause, it should be “given controlling
weight in all but the most exceptional cases, ”
Id. at 63. (citations omitted).
The presence of a valid forum-selection clause requires
district courts to adjust their usual § 1404(a) analysis
in three ways. First, the plaintiff's choice of forum
merits no weight, and the plaintiff, as the party defying the
forum-selection clause, has the burden of establishing that
transfer to the forum for which the parties bargained is
unwarranted. Second, the court should not consider the
parties' private interests aside from those embodied in
the forum-selection clause; it may consider only public
interests. Because public-interest factors will rarely defeat
a transfer motion, the practical result is that
forum-selection clauses should control except in unusual
cases. Third, when a party bound by a forum-selection clause
flouts its contractual obligation and files suit in a
different forum, a § 1404(a) transfer of venue will not
carry with it the original venue's choice-of-law rules.
Id. (citation omitted).
do not dispute that the 2013 and 2015 Agreements underlying
this action contain forum selection clauses. Rather, they
assert that a third contract which does not contain such a
clause is the primary contract. (Doc. 20 at 2). Defendants
also attempt to distinguish this action from Atlantic
Marine, quoted above, by arguing that Atlantic
Marine “concerns the procedure that is available
for a defendant in a civil case who seeks to enforce a
forum-selection clause”, unlike in this action where
Plaintiffs are seeking to enforce the forum selection clause.
(Doc. 20 at 2). Defendants then assert that this Court's
ruling in Lasalle Bank N.A. v. Mobile Hotel Properties,
LLC, 274 F.Supp.2d 1293 (S.D. Ala. 2003), is more on
point because like this action, in Lasalle, the
Defendants sought transfer to a district where all the
defendants reside when the operative facts did not take place
in the state where the action was filed and when transfer was
warranted despite the requirement that Alabama law applied.
(Doc. 20 at 3).
arguments are not compelling. First, it is clear from the
Complaint that the 2013 and 2015 Agreements which contain
forum selection clauses are at issue in this action. (Doc. 16
at 11-16; Doc. 19-1 at 12, 23). Further, Plaintiffs fail to
substantiate their position that the existence of a third
contract signed in 2011 that does not have a forum selection
clause would negate the clauses in the subsequent Agreements.
Second, Plaintiffs offer no case law to support that the
outcome in Atlantic Marine would be different if the
Plaintiff, instead of the Defendant, had sought to enforce
the agreement. Moreover, it is clear that the Court's
reasoning in Atlantic Marine was based not on which
party sought to enforce the clause, but on the burden of the
party attempting to defy the clause. Atlantic
Marine, 571 U.S. at 63 (“[A]s the party defying
the forum-selection clause, the plaintiff bears the burden of
establishing that transfer to the forum for which the parties
bargained is unwarranted.”) Here, Defendants, as the
party attempting to defy the forum selection clause, bear the
burden. Third, the case on which Defendants rely to support a
transfer of venue is readily distinguishable from the instant
action because it did not involve a forum selection clause at
all. See Lasalle, supra. Accordingly, to be
successful in having this action transferred, Defendants must
show that public interest considerations weigh in favor of
transfer. See Atlantic Marine, 571 U.S at 64)
(“Whatever ‘inconvenience' [the parties]
would suffer by being forced to litigate in the contractual
forum as [they] agreed to do was clearly foreseeable at the
time of contracting.” […] As a consequence, a
district court may consider arguments about public-interest
factors only.”) (citations omitted).
public-interest factors to be considered “include
‘the administrative difficulties flowing from court
congestion; the local interest in having localized
controversies decided at home; [and] the interest in having
the trial of a diversity case in a forum that is at home with
the law.'” Atlantic Marine 571 U.S at n. 6
(quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235,
241, n. 6 (1981)). Defendant contends the public interest
factors weigh in favor of transfer because (1) the District
Court for the Northern District of Texas has more judicial
staff, therefore lessening the administrative burden on this
Court, (2) the operative events underlying Plaintiffs'
claims, “including negotiation, execution, performance,
and alleged breach of the contracts” occurred in the