Murphy v. Allen County Claims & Adjustments

• Decision Date: 29 October 1982
• Docket Number: No. C-1-82-284.,C-1-82-284.
• Citation: 550 F. Supp. 128
• Parties: Hurston MURPHY, Plaintiff, v. ALLEN COUNTY CLAIMS & ADJUSTMENTS, INC., et al., Defendants.
• Court: U.S. District Court — Southern District of Ohio

550 F. Supp. 128

Hurston MURPHY, Plaintiff, v. ALLEN COUNTY CLAIMS & ADJUSTMENTS, INC., et al., Defendants.

No. C-1-82-284.

United States District Court, S.D. Ohio, W.D.

October 29, 1982.

John Bower, Southeastern Legal Services, Portsmouth, Ohio, for plaintiff.

Gene Mesh, Cincinnati, Ohio, for defendants; Harland M. Britz, Britz & Zemmelman, Toledo, Ohio, of counsel.

OPINION AND ORDER

DAVID S. PORTER, Senior District Judge.

I

Plaintiff, Hurston Murphy, brought suit against defendants, Allen County Claim & Adjustments ACCA, Inc. and David Crotinger, manager of ACCA, under the Fair Debt Collection Practices Act the FDCPA, 15 U.S.C. § 1692 et seq., on March 11, 1982. Plaintiff alleges that he is a "consumer" within the meaning of 15 U.S.C. § 1692a(3), Complaint ¶ 3, and that defendants are "debt collectors" within the meaning of 15 U.S.C. § 1692a(4). Complaint ¶ 4. Defendants allegedly made several communications by mail to plaintiff which violate the FDCPA. Complaint ¶ 6.

On March 30, 1982, defendants moved to dismiss the action for improper venue under Rule 12(b)(3) of the Federal Rules of Civil Procedure, or in the alternative, to transfer venue to the Northern District of Ohio, Western Division, under 28 U.S.C. § 1404. We deny both motions, the latter without prejudice.

Plaintiff stated in his complaint at ¶ 2 that his claim is venued appropriately pursuant to 28 U.S.C. § 1692(b). Section 1692 of Title 28 concerns "Process and orders affecting property in different districts," and is clearly inapposite. There is no subsection (b). Defendant rightly argues that we must look to the general venue statute, 28 U.S.C. § 1391, to determine whether plaintiff's choice of venue in the Southern District of Ohio is appropriate.

Subsection (b) provides:

A civil action wherein jurisdiction is not founded solely on diversity of citizenship, may be brought only in the judicial district where all defendants reside, or in which the claim arose, except as otherwise provided by law.

28 U.S.C. § 1391(b). Both of the defendants reside in the Northern District of Ohio; therefore, the Southern District is appropriate only if "the claim arose" there.

The defendants reside and do business in Lima, Ohio within the Northern District of Ohio. Defendants assert that "it may be assumed for purposes of this motion that the mailings alleged to be in violation of the FDCPA were made at Lima, Ohio. Memorandum in Support of Defendants' Motion at 2. Plaintiff claims that the mailings were sent to him in the Southern District of Ohio, where he presently resides. Memorandum in Opposition to Defendants' Motion to Dismiss or Change Venue at 1. Defendants correctly state:

The question therefore comes down to a determination of whether the claim arose in the Northern District of Ohio where the mailings were made or in the Southern District of Ohio, where the mailings were received.

Memorandum in Support of Defendants' Motion at 3.

II

Prior to 1966, venue was proper in federal question cases only in the district where all of the defendants resided. 28 U.S.C. § 1391(b). In 1966, subsection (b) was amended to extend venue to a district "in which the claim arose." Unfortunately, Congress did not supply any definition of the language "in which the claim arose," either in statutory text or in pertinent legislative history, and no black-letter rule is derivable from other legal contexts in which the phrase is used. See Lamont v. Haig, 590 F.2d 1124, 1132-33 (D.C.Cir.1978); 1 J. Moore, Federal Practice ¶ 0.142 5.-2 at 1427-28.

The courts have adopted several different approaches for determining where a claim arose within the meaning of Section 1391(b). See Note, Federal Venue: Locating the Place Where the Claim Arose, 54 Tex.L.Rev. 392 (1976). One of the more widely used tests focuses on where the "contacts" weigh most heavily. This test was established in Philadelphia Housing Authority v. American Radiator & Standard Sanitary Corp., 291 F.Supp. 252 (E.D. Pa.1968). However, as the court phrased the so-called "weight of contacts" test, it is not clear whether it thought that only one district would exist in which the contacts weighed most heavily, or whether venue could lie in more than one district. The courts that have followed Philadelphia Housing have reflected this ambiguity. See, Note, 54 Tex.L.Rev. 392, 403-04. Moreover, the cases purporting to apply this test have not illuminated how the contacts are to be weighed or when they are significant. See 15 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 36 (1976).

An alternative test confers venue in a district where a substantial portion of the acts or omissions giving rise to the actions occurred, notwithstanding that venue might also lie in other districts. This approach has been urged by the American Law Institute. ALI Study of the Division of Jurisdiction Between the State and Federal Courts §§ 1303, 1314 (1969). This "substantial part" test was endorsed by the Court of Appeals for the District of Columbia in Lamont v. Haig, 590 F.2d 1124 (D.C.Cir. 1978). That court looked to the legislative history of the 1966 amendment to Section 1391(b) and noted:

The legislative concern was pragmatic. Since the place where the claim arose is the situs of events important to the case, Congress undertook `to facilitate the administration of justice' by permitting suit in a district where the litigation might more handily progress.

590 F.2d at 1133-34, quoting Letter from Ramsey Clark, Deputy Attorney General, to Emanuel Celler, Chairman, Committee on the Judiciary, House of Representatives (Nov. 5, 1965), attached to and made part of S.Rep. No. 1752, 89th Cong., 2d Sess. 1-2 (1966), U.S.Code Cong. & Admin.News 1966, 3693.

Accordingly, the D.C. Circuit in Lamont determined that where "the claim arose" should "be ascertained by advertence to events having operative significance in the case, and a commonsense appraisal of the implications of those events for accessibility to witnesses and records." 590 F.2d at 1134. The court noted that "the forum court should not oppose the plaintiff's choice of venue if the activities that transpired in the forum district were not insubstantial in relation to the totality of events giving rise to the plaintiff's grievance and if the forum is generally convenient for all litigants." Id. at 1134 n. 62. (Emphasis added.)

A third approach for determining where the claim arose is to look to the place of injury. This test has been applied most frequently in tort actions; however, it has also been applied in the antitrust area. Note, 54 Tex.L.Rev. 392, 407.

The Supreme Court in Leroy v. Great Western United Corp., 443 U.S. 173, 185, 99 S.Ct. 2710, 2717, 61 L.Ed.2d 464 (1979) acknowledged that

in the unusual case in which it is not clear that the claim arose in only one specific district, a plaintiff may choose between those two (or conceivably even more) districts that with approximately equal plausibility — in terms of the availability of witnesses, the accessibility of other relevant evidence, and the convenience of the defendant (but not of the plaintiff) — may be assigned as the locus of the claim.¹

The Sixth Circuit has not adopted a test for locating where the claim arose under Section 1391(b). Nor has it offered us any guidance in interpreting the Supreme Court's dicta in Leroy as to what circumstances may give rise to proper venue in more than one district.

III

Plaintiff contends that the "place of injury" test is applicable here. He cites two cases in which the courts have considered the issue of where a claim under the FDCPA arises, viz. Gachette v. Tri-City Adjustment Bureau, 519 F.Supp. 311 (N.D. Ga.1981) and Lachman v. Bank of Louisiana in New Orleans, 510 F.Supp. 753 (N.D.Ohio 1981). Like this case, both of those cases involved communications alleged to be violative of the FDPCA by a debt collector located in one judicial district to a consumer located in another district. Both courts held that the claims arose where the injury to the plaintiff occurred, i.e., where the communications were received.

Defendants contend that Lachman "is of no assistance to the case at bar" because "jurisdiction was founded on diversity of citizenship, and therefore 29 U.S.C. § 1391(a), and not § 1391(b) was applicable." Reply Memorandum in Support of Motion to Dismiss or Change Venue at 1. We believe, however, that the Lachman court's reasoning deserves our consideration because it concerns the construction of the language "in which the claim arose."² Judge Green wrote:

The statutory causes of action, involving as they do the alleged breaches of a legal duty, are closely analogous to a common law tort, and thus tort principles apply in determining where the statutory claims `arose.' It would appear that any loss as a result of either of plaintiff's statutory or tort claims would have been suffered in the Northern District of Ohio. Thus the claims `arose' there.³

In Gachette, the district court determined that 28 U.S.C. § 1391(b) was the applicable venue provision. The court then noted that the events having operative significance were the phone calls made by defendants in Virginia to plaintiff and others in Georgia. "The phone calls, allegedly in violation of the FDCPA Act, were initiated in Virginia; they were completed in Georgia, and the harm occurred here in Georgia." 519 F.Supp. 311, 313. The court conceded that "Virginia would also be a proper forum." Id. at 314. However, the court concluded:

It appears to the Court that discovery in this case will not be particularly extensive, ... and since transfer of the case to Virginia would inconvenience plaintiff at least as much as defendants are presently inconvenienced, the Fifth Circuit's admonition not to oppose plaintiff's choice of venue `if the activities that transpired in the district where suit is brought were not insubstantial and the forum is a convenient one balancing the equities and

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