Bowerman Cleaning & Restoration LLC v. Stamford Plaza Hotel & Conference Center…

Background

Bowerman Cleaning & Restoration LLC sued Stamford Plaza Hotel & Conference Center d/b/a The Armon Hotel, Rosdev Hotel Management Services Inc., and Stamford Hospitality L.P. Bowerman alleged claims for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, conversion, account stated, and diversion of trust funds under New York Lien Law Section 72.

According to the complaint, a fire broke out in the Armon Hotel’s garage on or about April 13, 2023. The Armon Hotel then engaged Bowerman to provide emergency restoration and cleaning services. Bowerman performed the services between April 13 and April 17, 2023, charged $314,166.32, and alleged that it had not been paid.

Defendants’ Motion

The Defendants moved to dismiss for lack of personal jurisdiction and improper venue. They alternatively sought transfer to the District of Connecticut.

Personal jurisdiction is a court’s authority over a defendant. Because this was a diversity case, the court applied New York’s jurisdiction statutes. Bowerman did not respond to the Defendants’ argument that general jurisdiction under New York Civil Practice Law and Rules Section 301 was absent, so the court treated that argument as conceded. Bowerman also did not address several possible bases for specific jurisdiction under Section 302 and therefore conceded those points as well.

The court considered Section 302(a)(3), which can provide jurisdiction for certain tort claims involving conduct outside New York that causes injury in New York. The court explained that Bowerman’s contract, quasi-contract, and account-stated claims could not rely on that subsection because it applies only to tort claims. The court considered conversion and the New York Lien Law Section 72 claim as the remaining potentially relevant claims.

The court nevertheless found no personal jurisdiction over the Defendants. Bowerman alleged that the Defendants received insurance proceeds connected to the services and failed to pay Bowerman. The court characterized the alleged injury as purely financial. It held that financial consequences felt in New York, without a direct injury in New York, were insufficient to establish jurisdiction under Section 302(a)(3). The court also found that the Lien Law claim could not support jurisdiction because it was based on the same purely financial injury.

Venue and Transfer

Venue is the proper federal district in which a case may be litigated. The court found venue improper in the Southern District of New York because no Defendant resided there, the events giving rise to the claims occurred in Connecticut, and the court lacked personal jurisdiction over the Defendants.

The court then evaluated transfer to the District of Connecticut under 28 U.S.C. Section 1404(a). It found that the action could have been brought there because two Defendants resided in that district. The court concluded that Bowerman’s choice of forum and the convenience of the parties and witnesses weighed against transfer, while the location of the operative facts weighed heavily in favor of transfer. The location of documents was neutral, and the parties did not provide information making the remaining factors favor either side. Because the case was at an early stage, the court also found little loss of judicial efficiency from transferring it.

Disposition

The court granted the Defendants’ motion. It directed the Clerk to transfer the action to the District of Connecticut and close the case in the Southern District of New York. The opinion resolved personal jurisdiction and venue; it did not decide whether Bowerman’s underlying contract, conversion, or other claims were legally or factually valid.