Telephone Management Corp. v. Goodyear Tire & Rubber Co.

5 F. Supp. 2d 896, 1998 U.S. Dist. LEXIS 7712, 1998 WL 261580
CourtDistrict Court, D. Oregon
DecidedMay 6, 1998
DocketCiv. 98-31-FR
StatusPublished
Cited by2 cases

This text of 5 F. Supp. 2d 896 (Telephone Management Corp. v. Goodyear Tire & Rubber Co.) is published on Counsel Stack Legal Research, covering District Court, D. Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Telephone Management Corp. v. Goodyear Tire & Rubber Co., 5 F. Supp. 2d 896, 1998 U.S. Dist. LEXIS 7712, 1998 WL 261580 (D. Or. 1998).

Opinion

OPINION

FRYE, District Judge.

In this breach of contract action, the plaintiff, Telephone Management Corporation (TMC), alleges that the defendant, The Goodyear Tire & Rubber Company (Goodyear), breached a contract in which Goodyear promised to compensate TMC for obtaining reduced telephone rates for Goodyear. Before the court is Goodyear’s motion to transfer (change venue) (# 12).

ALLEGED FACTS

TMC analyzes the telephone billings and other services provided to large companies, creates proprietary plans for cost savings to these companies based upon these analyses, and is compensated for its services based upon the percentage of cost savings, refunds, or credits the large companies receive as a result of TMC’s recommendations. TMC entered into a contract with Goodyear on June 18, 1992 to provide this service to Goodyear. Goodyear also agreed to allow TMC to audit Goodyear’s telephone billings in order to establish the amount of savings that could be obtained on its telephone services.

In October of 1994, Goodyear asked TMC to assist it in obtaining further cost savings on the telecommunication rates that Goodyear had unilaterally negotiated with AT & T. Goodyear told TMC that it was not involved in any ongoing negotiations or discussions with telecommunication vendors. TMC gave Goodyear additional analyses and recommendations for Goodyear’s telecommunications traffic. During 1995, TMC repeatedly contacted Goodyear to determine what use Goodyear had made of TMC’s recommendations. On January 3, 1996, TMC formally asked Goodyear to let TMC audit Goodyear’s telephone billings from October 1994 onward, as provided under the contract. On January 11, 1996, Goodyear terminated its contract with TMC.

TMC believes that Goodyear used the recommendations of TMC to achieve increased savings after October of 1994 and then unilaterally negotiated a more advantageous contract with AT & T in March of 1996. TMC has not received any payments on the savings that it believes Goodyear obtained based on its recommendations.

TMC alleges claims for breach of contract, breach of the implied covenant of good faith and fair dealing, quantum meruit, misrepresentation, and misappropriation of trade secrets.

CONTENTIONS OF THE PARTIES

Goodyear contends that this action should be transferred to the Northern District of Ohio because the laws of the State of Ohio govern this action, and all of the documents, the third-party witnesses, and the witnesses that Goodyear intends to call at trial are located in the Northern District of Ohio.

TMC contends that this action should remain in the District of Oregon because its choice of forum should be respected; most of TMC’s witnesses are located in the State of Oregon; the documents located in the State of Ohio can easily be reproduced on CD-ROM and brought to the State of Oregon; and TMC, a small company, will suffer financial hardship if its principals have to travel to the State of Ohio for a month-long trial.

LEGAL STANDARDS

28 U.S.C. § 1404(a) states that “[f]or the convenience of 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.”

ANALYSIS AND RULING

The purpose of section 1404(a) is to prevent waste of time, energy and money and to protect litigants, witnesses and the public against unnecessary inconvenience and expense. Van Dusen v. Barrack, 376 U.S. 612, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964). The court must balance the preference given to the plaintiffs choice of forum with the burden of litigating in an inconvenient forum. Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir.1986). The *898 defendant has the burden of making a strong showing of inconvenience before a transfer is allowed. The private factors considered by the court include the:

relative ease of access to sources of proof; availability of compulsory process for attendance of- unwilling, and the cost of obtaining attendance of willing, witnesses; possibility of view of premises, if view would be appropriate to the action; and all other practical problems that make trial of a case easy, expeditious and inexpensive.

Id. at 843 (quotation omitted). The public factors include:

the administrative difficulties flowing from court congestion; the ‘local interest in having localized controversies decided at home’; the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action; the avoidance of unnecessary problems in conflict of laws, or in the application of foreign law; and the unfairness of burdening citizens in an unrelated forum with jury duty.

Id. (quotation omitted).

Goodyear contends that the following facts demonstrate that this action should be transferred to the Northern District of Ohio. An independent contractor, John Marlowe, approached Goodyear at its head office in the State of Ohio to solicit business for TMC. Joseph Gilchrist, Goodyear’s former assistant comptroller of information services who was involved with the TMC contract, has retired and lives in the State of Ohio. Joseph Gilchrist suffers from severe health problems which would make it an extreme hardship for him to travel to the State of Oregon. Goodyear’s former manager of corporate telecommunications, Earl Jobe, has retired and lives in the State of Ohio. He was the principal negotiator of the 1994 contract between Goodyear and AT & T. Earl Jobe states under oath that all of Goodyear’s records which TMC wishes to audit are located in the Northern District of Ohio and are voluminous. Richard Robson, who reported to Jobe and was the Goodyear employee who worked on a daily basis with TMC, has retired and lives in the State of Ohio. Robert Boberg, the principal negotiator on behalf of AT & T during the 1994 negotiations, lives in the Northern District of Ohio. All AT & T documents relating to those negotiations are located in the Northern District of Ohio. Two other AT & T employees who were negotiators along with Boberg live in the Northern District of Ohio, and a third, Barbara Riddic, lives in Atlanta, Georgia.

TMC contends that many factors should persuade the court to respect its choice of forum. TMC is a small company with nine employees and four officers. All of its documents relating to the negotiation and performance of the contract with Goodyear are located in the State of Oregon. Thomas Morency, chief executive officer of TMC who lives in the State of Oregon, was the primary contact with Goodyear. No employee of TMC ever went to the State of Ohio to perform the contract; their work was all done in the State of Oregon. Fred Accuardi, president of TMC who lives in the State of Oregon, and Janis Hoyer, a former TMC employee who also lives in the State of Oregon, analyzed Goodyear’s telecommunication traffic and billing patterns.

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5 F. Supp. 2d 896, 1998 U.S. Dist. LEXIS 7712, 1998 WL 261580, Counsel Stack Legal Research, https://law.counselstack.com/opinion/telephone-management-corp-v-goodyear-tire-rubber-co-ord-1998.