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A federal district court in California has ruled that where the only factor tying a case brought in the Northern District of California by an insured against her insurance company was the location of the insured's lawyer, venue should be transferred to Ohio, where the insured resided and which had a greater interest in the matter.

The Case

Roslyn Devaux-Spitzley, a former employee of JPMorgan Chase Bank, discontinued work after a meniscus tear. She filed for disability benefits with Prudential Insurance Company of America as a participant in the Chase Bank Employee Long Term Disability Plan.

Prudential concluded that Ms. Devaux-Spitzley was not disabled from working as long as she was able to take a 15 minute break after every 45 minutes of working.

Ms. Devaux-Spitzley subsequently sued Prudential in the U.S. District Court for the Northern District of California, asserting claims under the Employee Retirement Income Security Act of 1974 (“ERISA”).

Prudential moved to transfer venue to the Southern District of Ohio.

The District Court's Decision

The district court granted the motion.

In its decision, the district court explained that, in ERISA cases, the plaintiff's choice of forum was afforded “great deference.” The district court added, however, that a plaintiff's chosen forum received “considerably less weight” when the plaintiff did not reside there and the operative facts occurred elsewhere.

The district court then pointed out that Ms. Devaux-Spitzley resided in Ohio and that none of the operative facts in her complaint had taken place in the Northern District of California. The medical providers involved in Ms. Devaux-Spitzley's claim were located in Chicago, Ohio, and Los Angeles; independent file reviews during the claim administration were conducted by doctors in Connecticut and Colorado; and other Prudential employees responsible for reviewing Ms. Devaux-Spitzley's long-term disability benefits claim were located in various cities across the United States – none in the Northern District of California. In sum, the district court found, “nothing” about Ms. Devaux-Spitzley's medical treatment or the administration of her claim had any connection to the Northern District.

Her “sole connection to the Northern District,” the district court said, was that her counsel was “located here.”

The district court was not persuaded by Ms. Devaux-Spitzley's arguments that:

- Transferring her case to Ohio would result in her counsel incurring substantial travel expenses that she would have to bear even though she was “in no position to make unnecessary expenditures for attorney airfare and hotels”;

- Despite exercising diligence, she was unable to find local counsel in Ohio; and

- She retained her counsel “based upon their excellent reputation” and filed suit in San Francisco because that was where her attorneys resided and “doing so would minimize attorney travel costs and expenses.”

The district court pointed out that the additional costs to Ms. Devaux-Spitzley of transfer to Ohio were a function of her having selected a San Francisco lawyer. The district court did not credit Ms. Devaux-Spitzley's statement that she was unable to find a lawyer in Ohio, and said that to weigh the additional costs to Ms. Devaux-Spitzley against transfer “would put the cart before the horse, and incentivize future plaintiffs to hire in-district lawyers as a way of fending off meritorious motions to transfer.”

The district court next found that Ohio had a greater local interest in the controversy because Ms. Devaux-Spitzley resided there, her alleged denial of benefits took place there, the benefits if received would have been paid there, and the events that gave rise to her causes of action had no connection to the Northern District of California.

Concluding that the “only factor” tying Ms. Devaux-Spitzley's case to the Northern District of California was the location of her lawyer, the district court found transfer to the Southern District of Ohio was warranted.

The case is Devaux-Spitzley v. Prudential Ins. Company of America, No. 18-cv-04436-JST (N.D. Cal. Feb. 26, 2019). Attorneys involved include: For Roslyn Devaux-Spitzley, an individual, Plaintiff: Joseph Andrew Creitz, LEAD ATTORNEY, Lisa Sharon Serebin, Creitz & Serebin LLP, San Francisco, CA. For Prudential Insurance Company of America, a New Jersey corporation in its capacities as a fiduciary and claims administrator of the ERISA-regulated Chase Bank Employee Long Term Disability Plan, Defendant: Jason A. James, LEAD ATTORNEY, Linda Marie Lawson, Meserve Mumper & Hughes LLP, Los Angeles, CA.

Steven A. Meyerowitz, Esq., is the Director of FC&S Legal, the Editor-in-Chief of the Insurance Coverage Law Report, and the Founder and President of Meyerowitz Communications Inc. As FC&S Legal Director, Mr. Meyerowitz, a member of the team that conceptualized FC&S Legal, provides daily analysis and commentary on the most significant insurance coverage law decisions from courts across the country and news regarding legislative and regulatory developments. A graduate of Harvard Law School, Mr. Meyerowitz was an attorney at a prominent Wall Street law firm before founding Meyerowitz Communications Inc., a law firm marketing communications consulting company.