In re National Presto Industries, Inc.

• Decision Date: 21 October 2003
• Docket Number: No. 03-1873.,03-1873.
• Citation: 347 F.3d 662
• Parties: In re: NATIONAL PRESTO INDUSTRIES, INC., Petitioner.
• Court: U.S. Court of Appeals — Seventh Circuit

347 F.3d 662

In re: NATIONAL PRESTO INDUSTRIES, INC., Petitioner.

No. 03-1873.

United States Court of Appeals, Seventh Circuit.

Submitted April 23, 2003.

Decided October 21, 2003.

James G. Hunter, Jr. (submitted a brief), Latham & Watkins, Chicago, IL, for Petitioner.

Kathryn A. Pyszka (submitted a brief), Chicago, IL, for Party-in-Interest Securitites and exchange Commission.

Before BAUER, POSNER, and WILLIAMS, Circuit Judges.

POSNER, Circuit Judge.

The Securities and Exchange Commission has sued National Presto Industries in the federal district court in Chicago, charging that Presto has been operating as an unregistered investment company in violation of Section 7(a) of the Investment Company Act of 1940, 15 U.S.C. §§ 80a-1 et seq. Presto asked the court to transfer the case to the Western District of Wisconsin pursuant to 28 U.S.C. § 1404(a), which authorizes changes of venue "for the convenience of parties and witnesses, in the interest of justice." The district judge denied the motion, emphasizing that the Northern District of Illinois was the venue most convenient for the SEC and that a plaintiff's choice of forum is entitled to considerable deference. An order granting or denying a motion under Rule 1404(a) is not a final order, but Presto has filed a petition for a writ of mandamus asking us to direct the district court to transfer the action to the Western District of Wisconsin. The petition raises the question, on which there are no cases in this court and few elsewhere, of the weight to be given a government agency's appeal to convenience in resisting a motion for change of venue.

Presto faces an uphill fight in seeking mandamus, which is granted only upon a demonstration that the district court "so far exceeded the proper bounds of judicial discretion as to be legitimately considered ursurpative in character or in violation of a clear and indisputable legal right, or at the very least, patently erroneous" and that the injury caused by the challenged order cannot be repaired by any means other than mandamus, such as by waiting till the appeal from the final judgment. In re Rhone-Poulenc Rorer Inc., 51 F.3d 1293, 1295 (7th Cir.1995); In re Sandahl, 980 F.2d 1118, 1119 (7th Cir.1992). The requirement of irreparable harm is fulfilled in this case. Granted that unrecoverable costs of litigation, such as attorneys' fees, do not count as irreparable harm, FTC v. Standard Oil Co., 449 U.S. 232, 244, 101 S.Ct. 488, 66 L.Ed.2d 416 (1980); Renegotiation Board v. Bannercraft Clothing Co., 415 U.S. 1, 24, 94 S.Ct. 1028, 39 L.Ed.2d 123 (1974); PaineWebber Inc. v. Farnam, 843 F.2d 1050 (7th Cir.1988)—otherwise every interlocutory ruling in a litigation would be subject to immediate appellate review via mandamus—Presto would not have an adequate remedy for an improper failure to transfer the case by way of an appeal from an adverse final judgment because it would not be able to show that it would have won the case had it been tried in a convenient forum.

Whether the denial of the motion to transfer was patently erroneous, or indeed erroneous at all, is much more doubtful especially since, "unless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed." Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508, 67 S.Ct. 839, 91 L.Ed. 1055 (1947); see also Zelinski v. Columbia 300, Inc., 335 F.3d 633, 643 (7th Cir.2003); Pollux Holding Ltd. v. Chase Manhattan Bank, 329 F.3d 64, 70 (2d Cir.2003). Rarely, however, is not never. See, e.g., Chicago Rock Island & Pac. R.R. v. Igoe, 220 F.2d 299, 305 (7th Cir.1955); In re Horseshoe Entertainment, 337 F.3d 429, 434-35 (5th Cir.2003); cf. Hustler Magazine, Inc. v. United States District Court, 790 F.2d 69, 73 (10th Cir.1986).

According to Presto, the only relation between the Northern District of Illinois and the SEC's lawsuit is that it was the agency's Midwest Regional Office, which is located in Chicago, that conducted the investigation leading up to the suit. This is a bit of an exaggeration, since Presto operates throughout the country and at least two investors alleged to have been harmed by its alleged violation of the Investment Company Act are located in Chicago. But this is just to say that Chicago is one permissible venue for the suit; it may not be the most convenient, or the most just. A number of Presto's potential witnesses are located in the Western District of Wisconsin, which is where Presto's headquarters is located (in the city of Eau Claire), while it appears that the only persons who would be inconvenienced by having to litigate in that district rather than in Chicago would be members of the SEC's Midwest Regional Office staff. Moreover, all Presto's potential witnesses, some of whom may be reluctant to become involved in the litigation, are within the subpoena power of the federal district for the Western District of Wisconsin, but are out of subpoena range of the district court in Chicago. (Although defendants in federal securities cases, including cases under the Investment Company Act, can be subpoenaed wherever located, see 15 U.S.C. §§ 77v, 78...