United States District Court, D. Utah, Central Division
MEMORANDUM DECISION AND ORDER GRANTING MOTION TO
J. SHELBY UNITED STATES DISTRICT JUDGE.
FCA U.S. LLC (FCA) filed a Motion to Transfer Venue and
Motion to Stay Discovery. FCA asks the court to transfer this
case to the Southern District of New York for referral to the
Bankruptcy Court and to stay discovery pending transfer.
Plaintiff Makenna Bennett requests the court deny the Motion
to Transfer, or, in the alternative, transfer only two of the
asserted claims. For the reasons stated below, the court
grants the Motion to Transfer, but declines to impose a stay.
case arises from a car crash involving a 2004 Dodge Durango.
Bennett, a passenger in the Durango, suffered multiple
injuries in the crash. Bennett filed a Complaint against FCA,
which had purchased assets from the Durango's
manufacturer as part of a transaction overseen by the
Bankruptcy Court for the Southern District of New York.
Bennett asserts claims for strict liability, negligence,
breach of express warranty, breach of implied warranty of
merchantability, and breach of implied warranty of fitness
for a particular purpose.
moves the court to transfer the case to the Southern District
of New York for referral to the Bankruptcy Court, asserting
that Bennett's allegations against FCA require
interpreting the Bankruptcy Court's orders, over which
the Bankruptcy Court retained jurisdiction. FCA also seeks to
stay discovery if the case is transferred.
district court may transfer a case relating to bankruptcy to
a different venue “in the interest of justice or for
the convenience of the parties.”
moves for a transfer to the Southern District of New York for
referral to the Bankruptcy Court and for a stay of discovery
while the claims are pending in that court. Bennett argues
against the transfer or, alternatively, that the court should
sever the action and transfer only the negligence and failure
to warn claims. The court will first address whether transfer
is appropriate and then turn to the arguments for severance
and for a stay.
cases related to bankruptcy proceedings, venue may be proper
in either the district court or the bankruptcy court in which
the original bankruptcy proceeding was filed. A case is related
to the bankruptcy if “the outcome of that proceeding
could conceivably have any effect on the estate being
administered in bankruptcy.” That is, if a case filed in
a district court “could alter the debtor's rights,
liabilities, options, or freedom of action in any way,
” venue in the bankruptcy court may be
argues that this matter is related to the bankruptcy case
because the availability and success of Bennett's claims
depend on an interpretation of the Bankruptcy Orders. Bennett
argues that her Complaint seeks compensation from FCA, not
the bankruptcy estate, which has mostly already been
court concludes that Bennett's claims are related to the
bankruptcy proceeding because the bankruptcy case is ongoing
as long as a court must interpret the Bankruptcy Orders. The
Bankruptcy Court retained jurisdiction “to interpret,
implement and enforce the terms and provisions of this Sale
Order.” To the extent FCA has any liability for
negligence and failure to warn, it is only through the
assumption of liabilities under the Bankruptcy Orders.
this case is related to the bankruptcy proceeding, the court
must look to whether transferring venue would be “in
the interest of justice or for the convenience of the
parties.”“One of the most important
considerations in transferring the venue of a bankruptcy case
is whether the transfer will promote the efficient and
economic administration of the estate.”Various courts
have also applied a presumption that “the court where
the bankruptcy case is pending is the proper venue for all
related proceedings within the court's
argues that the interest of justice is best served by having
the bankruptcy court interpret its own Orders because it
promotes judicial economy. Bennett argues that
transferring venue would hinder judicial efficiency because
the case is already proceeding in this court. Additionally,
Bennett argues that the Bankruptcy Orders are clear ...