One strategic option in a class action that is rarely used in my experience (and as reflected in case law) but has a fair amount of law to support it is seeking a transfer of venue in federal court. In a multistate or nationwide putative class action, a defendant may have a strong argument for transfer of venue to the federal district where the corporate headquarters are located. A number of courts have concluded that the named plaintiff’s choice of forum in a putative class action is entitled to less weight where the named plaintiff is in one state and the putative class members are mostly in other states. Because discovery in a class action often focuses on the defendant’s documents and witnesses, the standard factors for transfer of venue (the location of witnesses and documents and locus of operative facts) often point to the district where the defendant’s central corporate offices are located.
A recent decision that caught my eye on this issue is Chambers v. North American Company for Life & Health Insurance, 2011 U.S. Dist. LEXIS 133844 (N.D. Ill. Nov. 18, 2011). In that case, the court transferred a nationwide putative class action to the Southern District of Iowa, where the defendant had its headquarters. The court explained that “because Plaintiff represents a putative class and opted to litigate outside of her home forum, we afford Plaintiff’s choice of forum little weight,” and also that “[b]ecause Plaintiff brings this suit as a national class action, we afford her choice of forum little weight but do not disregard it entirely.” Id. at *7-9. The other factors the court found significant were that the relevant witnesses were largely located at the insurer’s home office in Iowa, and the relevant events regarding the insurer’s alleged conduct occurred there. Id. at *10-13.
This is a strategic option that should not be overlooked. Most defendants would prefer to litigate a case in their “home” district and rarely is there anything to lose from filing a motion to transfer. You’re unlikely to offend the judge you have in the court where suit was filed. Indeed, many judges welcome getting a complex case off their busy docket and sending it elsewhere if it makes reasonably good sense to do so. It’s surprising that there aren’t more decisions on this subject in class actions.