Gordon v. State Farm Fire & Casualty Company

Background

Andrew S. Gordon sued State Farm Fire & Casualty Company over State Farm’s denial of an insurance claim. Gordon alleged that jewelry, including a diamond necklace valued at $76,900 and a Rolex watch valued at $64,800, was stolen from his rental car while he was traveling in California. He submitted a claim under an insurance policy that covered the jewelry. State Farm investigated and denied the claim, stating that its investigation found material misrepresentations in Gordon’s presentation of the claim.

Gordon filed the action in New York State Supreme Court, New York County, asserting breach of contract and what he called “bad faith insurance practices.” State Farm removed the case to federal court because the parties were diverse and then moved under 28 U.S.C. § 1404(a) to transfer the action to the District of Connecticut. State Farm argued that the policy was issued in Connecticut, that Connecticut law governed it, and that relevant witnesses and events were located there. Gordon argued that his choice of New York deserved substantial deference and pointed to his business contacts in New York and his lawyer’s admission to the New York bar.

Transfer Analysis

Section 1404(a) permits a federal court to transfer a case to another district where it could have been brought when transfer would serve convenience and the interests of justice. The court first found that the case could have been brought in Connecticut. Gordon lived there, the policy was entered into there through a Connecticut-based agent, and State Farm consented to jurisdiction there by seeking transfer.

The court then weighed the relevant factors. Gordon’s choice of New York counted slightly against transfer, but received less weight because he did not live there and the dispute had no meaningful connection to New York. The court found that the location of the operative facts strongly favored Connecticut: the policy was negotiated and formed there, Gordon alleged the breach occurred there, and the denial letter was sent to his Connecticut residence. The likely witnesses identified were Gordon and possibly his wife, both of whom were expected to be in Connecticut. The court also found that the parties’ convenience, the location of documents, familiarity with governing Connecticut law, trial efficiency, and the interests of justice favored transfer. The subpoena factor was neutral, and the relative-means factor weighed slightly against transfer but had little importance.

Ruling

Judge Gregory H. Woods granted State Farm’s motion to transfer the action to the United States District Court for the District of Connecticut under section 1404(a). The Clerk of Court was directed to terminate the motions pending at Dkt. Nos. 17 and 19 and transfer the case without delay. The opinion addressed the proper venue, not whether State Farm was correct to deny Gordon’s insurance claim.