United States District Court, D. Minnesota
Cynthia L. Hegarty, Esq., and Ryan R. Dreyer, Esq., Morrison,
Sund PLLC, counsel for Plaintiffs.
R. Koby, Esq., Koby Law, LLC, counsel for Defendants Jeff
Towner, Chris Weiss, and Todd Poss.
Francis M. Doherty, Esq., Hale Skemp Hanson Skemp &
Sleik, counsel for Christopher T. Walters.
MEMORANDUM OPINION AND ORDER
DONOVAN W. FRANK United States District Judge
matter is before the Court on a Motion to Transfer Venue
brought by Defendants Jeff Towner, Chris Weiss, and Todd Poss
(collectively, “Defendants”). (Doc. No. 8.) For
the reasons set forth below, the Court denies the motion.
case involves three contracts entered into by Plaintiffs KTJ
229, LLC, KTJ 251, LLC, and KTJ 236, LLC (collectively,
“Plaintiffs”) with TCI Architects Engineers
Contractor, Inc. (“TCI”), which is not a party to
this case. (See generally Doc. No. 1, Ex. 2 (First
Amended Complaint (“FAC”).) Basically, KTJ 229,
LLC, hired TCI as a general contractor to improve real
property located in Woodbury, Minnesota (see id.
¶¶ 8-9); KTJ 251, LLC, hired TCI to construct
certain site and rail improvements on property located in
Newcornerstown, Ohio (see Id. ¶¶ 12-13);
and KTJ 236, LLC, hired TCI to construct a gas and oil field
services facility on property located in Williston, North
Dakota (see id. ¶¶ 16-17).
allege a single count for Civil Theft under Wisconsin Statute
§ 779.02(5). (Id. ¶¶ 24-34.) In
particular, Plaintiffs claim that, prior to TCI's
commencement of an insolvency proceeding in the Circuit Court
of La Crosse County, Wisconsin (the “Assignment
Proceeding”), each Plaintiff made payments to TCI under
their respective contracts with TCI. (Id.
¶¶ 10, 14, 18, 20.) Plaintiffs allege that those
payments were designated for payments to subcontractor claims
related to each respective project. (Id.
¶¶ 10, 14, 18.) Plaintiffs further allege that
Defendants-two were members of TCI's Board of Directors
and shareholders of TCI, and the third was TCI's Chief
Financial Officer-misappropriated funds intended for payment
of Plaintiffs' subcontracts and caused TCI to fail to pay
subcontractors. (Id. ¶¶ 11, 15, 19.)
three Plaintiffs are Minnesota limited liability companies
with principal places of business in Excelsior, Minnesota.
(Id. ¶ 1.) TCI was a Wisconsin corporation with
its principal place of business in La Crosse, Wisconsin.
(Doc. No. 10 (“O'Flaherty Aff.”) ¶ 2.)
Defendants are all residents of Wisconsin. (FAC ¶¶
2-4.) On July 10, 2015, TCI commenced the Assignment
Proceeding. (FAC ¶ 20.) Attorney William Rameker was
appointed receiver to liquidate assets of TCI (the
“Receiver”). (O'Flaherty Aff. ¶ 7.)
Since July 10, 2015, the Receiver has run the operations of
TCI. (Id. ¶ 8.)
assert that its response to Plaintiffs' claim, generally,
is that TCI repaid a loan to BMO Harris Bank, N.A., its
primary secured creditor, because BMO had a lien on the funds
that was superior to any interest of Plaintiffs.
(Id. ¶¶ 5, 9.) Defendants further assert
that, to the extent that Plaintiffs' interest in those
funds was superior to BMO, Plaintiffs should demand payments
from BMO. (Id.) In addition, Defendants contend that
Plaintiffs should seek relief from the Receiver.
(Id. ¶10.) Accordingly, Defendants contend that
both the Receiver and BMO are necessary parties and that they
intend to implead them and their insurers. (Id.
¶ 11.) In addition, on or about April 13, 2016, Hartford
Fire Insurance Company (“Hartford”) started a
lawsuit against Defendants Chris Weiss and Jeff Towner in the
United States District Court for the Western District of
Wisconsin. (Id. ¶ 13, Ex. 1.) In that action,
Hartford alleges that Weiss' and Towner's actions
related to the Assignment Proceeding and that BMO wrongfully
caused Hartford to pay monies to complete TCI bonded contract
work. (Id. ¶ 13, Ex. 1 ¶¶ 7, 10-16,
now move to transfer this action to the Western District of
Wisconsin. The Court considers the motion below.
the convenience of the parties and witnesses, in the interest
of justice, a district court may transfer any civil action to
any other district or division where it might have been
brought.” 28 U.S.C. § 1404(a). When deciding a
motion to transfer pursuant to § 1404(a), the Court must
consider three factors: “(1) [t]he convenience of the
parties, (2) the convenience of the witnesses, and (3) the
interests of justice.” Terra Int'l, Inc. v.
Miss. Chem. Corp., 119 F.3d 688, 691 (8th Cir. 1997).
“[S]ection 1404(a) provides for transfer to a more
convenient forum, not to a forum likely to prove equally
convenient or inconvenient, and a transfer should not be
granted if the effect is simply to shift the inconvenience to
the party resisting the transfer.” Graff v. Qwest