433 F.2d 117 (5th Cir. 1970), 26168, Garner v. Wolfinbarger

Docket Nº:26168.
Citation:433 F.2d 117
Party Name:A. L. GARNER et al., Appellants, v. Rick WOLFINBARGER et al., Appellees. Ex parte A. L. GARNER et al., Petitioners, v. Hon. H. H. GROOMS, U.S. District Judge for the Northern District of Alabama, Rick Wolfinbarger, et al., Respondents.
Case Date:August 31, 1970
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

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433 F.2d 117 (5th Cir. 1970)

A. L. GARNER et al., Appellants,


Rick WOLFINBARGER et al., Appellees.

Ex parte A. L. GARNER et al., Petitioners,


Hon. H. H. GROOMS, U.S. District Judge for the Northern District of Alabama, Rick Wolfinbarger, et al., Respondents.

No. 26168.

United States Court of Appeals, Fifth Circuit.

Aug. 31, 1970

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J. Vernon Patrick, Jr., Howard P. Walthall, and Marvin Cherner, Birmingham, Ala., for A. L. Garner, and others; Berkowitz, Lefkovits, Vann & Patrick, Birmingham, Ala., of counsel.

Robert S. Vance, Birmingham, Ala., for First American Life Insurance Co.; Jenkins, Cole, Callaway & Vance, Birmingham, Ala., of counsel.

Wm. T. Gossett, Detroit, Mich., John C. Bartlett, Reno, Nev., Orvel Sebring, Philadelphia, Pa., Attys. for American Bar Assn. as amicus curiae; Gregory M. Harvey, Philadelphia, Pa., and William Bew White, Jr., Birmingham, Ala., of counsel.

C. A. L. Johnstone, Jr., J. Jeptha Hill, William H. Hardie, Jr., Mobile, Ala., for Leon V. McVay, Jr.; Johnstone, Adams, May, Howard & Hill, Mobile, Ala., of counsel.

Ronald P. Slepian, Mobile, Ala., for Dr. George Mitchell, Daniel P. Matthews, Bruce W. Skinner and Charles A. Schuerman; McDermott & Slepian, Mobile, Ala., of counsel.

Charles H. Erwin, Mobile, Ala., for Hiram D. Snowden, B. J. Withdrow, Rick Wolfinbarger, Merritt Marine, Oscar B. Liddell and Ollie Howell.

Bert S. Nettles, Mobile, Ala., for William R. Marshall; Johnston, Johnston & Nettles, Mobile, Ala., of counsel.

Champ Lyons, Jr., Herman H. Hamilton, Jr., L. Lister Hill, Montgomery, Ala., for Guy H. Aderholt, William M. Birchfield, Carey P. Buffington, C. T. Fitzpatrick, Dr. David C. Mussleman, Dr. Francis E. Nicholas, John N. Prim, Roy J. Reed, Jr., Ray Wyatt, A. J. Brown, Gale S. Fly; Capell, Howard, Knabe & Cobbs, Montgomery, Ala., of counsel.

Before JOHN R. BROWN, Chief Judge, GODBOLD, Circuit Judge, and CABOT, District Judge.

GODBOLD, Circuit Judge:

Plaintiffs sued the corporation in which they are shareholders, and various of the corporate directors, officers and controlling persons, claiming violations of

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federal and state securities laws, fraud and other wrongs. The District Court for the Northern District of Alabama transferred the cause to the Southern District of Alabama under 28 U.S.C. § 1404(a). The plaintiffs seek to review that order by interlocutory appeal under 28 U.S.C. § 1292(b) and by a petition for writ of mandamus against the District Judge who entered the transfer order directing him to retain jurisdiction of the cause. 1

This court granted permission for a § 1292(b) appeal from the transfer order but reserved ultimate determination of the appropriateness of the appeal for consideration along with the merits. We conclude that leave to appeal was improvidently granted. Also we deny the petition for mandamus.

To attempt to get within § 1292(b), the plaintiffs grasp for a controlling question of law as to which there is substantial ground for a difference of opinion by contending that a plaintiff's choice of forum should always be respected in actions brought under the Securities Act of 1933 and the Securities Act of 1934. Similar contentions have been rejected in Ex Parte Collett, 337 U.S. 55, 69 S.Ct. 944, 93 L.Ed. 1207 (1949) and United States v. National City Lines, Inc., 337 U.S. 78, 69 S.Ct. 955, 93 L.Ed. 1226 (1949). In Securities Act cases venue has been transferred to other districts in Schneider v. Sears, 265 F.Supp. 257 (S.D.N.Y.1967); Axe-Houghton Fund A, Inc. v. Atlantic Research Corp., 227 F.Supp. 521 (S.D.N.Y.1964); Sher v. Johnston, 216 F.Supp. 123 (S.D.N.Y.1963); Polaroid Corp. v. Casselman, 213 F.Supp. 379 (S.D.N.Y.1962).

The plaintiff's statutory privilege of choosing his forum is a factor, held in varying degrees of esteem, to be weighed against other factors in determining the convenient forum.

Time, Inc. v. Manning, 366 F.2d 690 (5th Cir. 1966). That factor is not controlling. Ultimately the trial judge must use his discretion. 2

This court has used the procedure of § 1292(b) to review both questions of law 3 and the discretion of the trial judge in transfer cases. But we have not squarely adjudicated the propriety of review of discretion under § 1292(b). In Ex parte Chas. Pfizer & Co., Inc., 225 F.2d 720 (5th Cir. 1955), a mandamus case, without referring to § 1292(b), we said that a transfer order was interlocutory and not appealable. We invited certification in Ex parte Deepwater Exploration Co., 260 F.2d 546 (5th Cir. 1958) but the District Court declined on grounds it was not an available procedure, Deepwater Exploration Co. v. Andrew Weir Ins. Co., 167 F.Supp. 185 (E.D.La.1958). Subsequently we issued another invitation in In re Humble Oil & Refining Co., 306 F.2d 567 (5th Cir. 1962), and this time it was accepted, Humble Oil & Refining Co. v. Bell Marine Service, Inc., 321 F.2d 53 (5th Cir. 1963). In Humble II we recognized that the question whether the District Court opinion in Deepwater correctly stated the law would have to await 'a proper case on another day.' Subsequently in Time, Inc. v. Manning, supra, we affirmed the District Judge's denial of a discretionary transfer, considering it along with a jurisdictional issue clearly appealable under § 1292(b), without consideration of the independent availability of such review. The 'proper case on another day' is now at hand. Presumably it was with this thought in mind that the panel which granted leave

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to appeal reserved ultimate decision on the appealability question until later.

We are of the view that § 1292(b) review is inappropriate for challenges to a judge's discretion in granting or denying transfers under § 1404(a). The Congressional policy against piecemeal appeals, as expressed in the final judgment rule, 28 U.S.C. § 1291, to which § 1292(b) is a narrow exception, is eroded by permitting review of exercise of the judge's discretion under § 1404(a) as a 'controlling question of law.' Our conclusion is the same as that already reached by the Second, Third, and Sixth Circuits, 4 and by the text writers. 5

The temptation is great when an interlocutory appeal is properly taken from one order, and the record is before us, and the parties themselves may desire a declaration on the validity of another interlocutory order not independently appealable under § 1292(b), to consider everything on a sort of ad hoc pendent jurisdiction basis. Apparently this is what happened in Time, Inc. v. Manning. A similar case is Koehring Co. v. Hyde Construction Co., 324 F.2d 295 (5th Cir. 1963), where appellant appealed from denial of a motion to dismiss on grounds of lack of jurisdiction in Mississippi and of alternative § 1404(a) and § 1406(a) 6 motions to transfer to Oklahoma. Without considering the question of availability of review, we held that we need not reach the jurisdiction issue because the case should be transferred to Oklahoma. There are several considerations against piecemeal appeals. It is contrary to the language of § 1292(b), which is in terms of the appealability where 'such order involves a controlling question of law.' The issue is not one of convenience to the litigants, or even to this court, but of appellate jurisdiction. The ad hoc approach invites the parties to inject a sham issue as the vehicle to bring the case to this court at the interlocutory stage for a declaration on an order not otherwise reviewable. And it confuses the courts and the parties, who assume that because a discretionary transfer order has been reviewed in one case it can be reviewed in any other.

This Circuit has recognized the availability of mandamus as a limited means to test the district courts' discretion in issuing transfer orders. Ex parte Blaski, 245 F.2d 737 (5th Cir.), cert. denied, 355 U.S. 872, 78 S.Ct. 122, 2 L.Ed.2d 76 (1957); Ex parte Chas. Pfizer & Co., supra; Atlantic Coast Line R.R. v. Davis, 185 F.2d 766 (5th Cir. 1950). Cf. Ex parte Deepwater Exploration Co., supra. 7

In the voluminous litigation over transfer orders, only a few litigants have surmounted the formidable obstacles and secured the writ. 8

There is not shown in this case any failure by the District Judge to correctly construe and apply the statute, or to consider the relevant factors incident to ruling upon a motion to transfer, or any clear abuse of discretion on his part. Blaski, supra; Pfizer, supra; Atlantic Coast Line, supra. While couched in

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other terms, what is urged upon us is that on balance the Northern District of Alabama is a more convenient forum than the Southern District. That is not the basis for a writ.

The transfer order is affirmed. The petition for writ of mandamus is denied.

JOHN R. BROWN, Chief Judge, concurring and dissenting in part:

I agree that the transfer from the Northern to the Southern District of Alabama should not be disturbed whether approached as a petition for mandamus or on its merits under § 1292(b). But I dissent as to the Court's holding that § 1292(b) is not available to test the grant or the denial of a transfer under § 1404(a) when the issue is the so-called 'abuse of discretion' by the trial Judge. 1

I think the decision is both a retreat and discounts too much the action and words of this Court in cases other than Humble II.

Heading the list of significant decisions holding against a direct challenge to the use of § 1292(b) in a § 1404(a) transfer is Continental Grain...

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