United States District Court, N.D. West Virginia
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT
YOST'S MOTION TO TRANSFER, DENYING AS MOOT THE INDIVIDUAL
DEFENDANTS' MOTIONS FOR ABSTENTION, DENYING AS MOOT
HUNTINGTON'S MOTION TO STRIKE NOTICE TO CHAPTER 11
TRUSTEE AND GRANTING MOTIONS FOR JOINDER
FREDERICK P. STAMP, JR. UNITED STATES DISTRICT JUDGE.
Hard Rock Exploration, Inc., Caraline Energy Company, Blue
Jacket Gathering, LLC, Blue Jacket Partnership, and Brothers
Realty (collectively, the “Hard Rock Entities”)
are business entities affiliated with defendant Hard Rock
Exploration, Inc., which engages in oil and gas development.
Defendants James Stephens, Jr., Monica Francisco, Duane Yost,
and Gregory Laughlin (collectively, “the individual
defendants”) are shareholders of defendant Hard Rock
Exploration, Inc. The Hard Rock Entities borrowed money from
the plaintiff, The Huntington National Bank
(“Huntington”), so as to pursue oil and gas
operations. Several years into the lending relationship,
however, Huntington claims that the defendants have failed to
satisfy their obligations. In particular, the following
amounts allegedly remain outstanding: (1) a $500, 000.00
loan; (2) a $17, 887, 867.00 loan; (3) a $6, 250, 000.00
loan; (4) a $5, 000, 000.00 loan; and (5) an unspecified
credit card obligation, which is allegedly worth $19, 148.10.
In addition, the parties engaged in a series of swap
transactions and a forbearance agreement, which contain the
following obligations: (1) termination charges for the swaps
totaling $839, 606.02; and (2) a $30, 000.00 forbearance fee.
Huntington seeks a judgment for the balance due under the
obligations listed above, including legal fees.
defendants filed a counterclaim asserting claim for fraud and
deceit (Count I), interference with prospective business
advantage (Count II), breach of implied covenant of good
faith and fair dealing (Count III), breach of contract (Count
IV), economic duress (Count V), breach of fiduciary duty
(Count VI), demand for injunctive relief (Count VII), demand
for declaratory judgment (Count VIII), and demand for an
accounting (Count IX). Huntington filed a motion to dismiss
the counterclaims (ECF No. 40), and this Court entered a
memorandum order and opinion denying Huntington's motion
to dismiss the counterclaims (ECF No. 69).
September 7, 2017, the Hard Rock Entities filed a notice of
bankruptcy stating that they each had filed a voluntary
petition for relief under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the
Southern District of West Virginia. ECF No. 87. The
bankruptcy actions are proceeding before United States
Bankruptcy Judge Frank W. Volk in the United States
Bankruptcy Court for the Southern District of West Virginia.
Accordingly, pursuant to 11 U.S.C. § 362 of the United
States Bankruptcy Code, this Court stayed this case as to the
Hard Rock Entities. ECF No. 91. Also pursuant to §
362(a), the proceedings were not stayed as to the individual,
state court civil action, which includes the same parties as
this Court's case and was removed to the United States
Bankruptcy Court for the Northern District of West Virginia
on September 8, 2017 (Misc. No. 1:17-MP-00001), was
transferred to the United States Bankruptcy Court for the
Southern District of West Virginia (Misc. No. 2:17-MP-02001)
on November 14, 2017. Accordingly, both that case and the
bankruptcy case underlying this civil action are now before
Judge Volk in the United States Bankruptcy Court for the
Southern District of West Virginia.
Duane Yost (“Yost”) has filed a motion for
transfer of venue to the United States Bankruptcy Court for
the Southern District of West Virginia. Thereafter,
Huntington responded and defendant Yost replied. Thus, the
motion is fully briefed and ripe for review. For the reasons
set forth below, defendant Yost's motion to transfer
venue is granted. Accordingly, pending motions for abstention
filed by the individual defendants are denied as moot.
are two different transfer provisions that may be applicable
to this civil action: 28 U.S.C. §§ 1404(a) and
28 U.S.C. § 1404(a)
motion to transfer a case to another venue is generally
subject to the provisions of 28 U.S.C. §§ 1404(a)
and 1391(a). Pursuant to 28 U.S.C. § 1404(a), “a
district court may transfer any civil action to any other
district or division where it might have been brought”
where such transfer is made “[f]or the convenience of
parties and witnesses, in the interest of justice.” 28
U.S.C. § 1404(a). This rule is intended to allow a court
to transfer venue in order to “make trial of a case
easy, expeditious and inexpensive.” Gulf Oil Corp.
v. Gilbert, 330 U.S. 501, 508 (1947) (superceded by
statute on other grounds).
§ 1404(a), the decision to transfer venue is left to the
sound discretion of the trial court. Southern Ry. Co. v.
Madden, 235 F.2d 198, 201 (4th Cir. 1956). In making
this determination, a court should consider:
(1) ease of access to sources of proof; (2) the convenience
of parties and witnesses; (3) the cost of obtaining the
attendance of witnesses; (4) the availability of compulsory
process; (5) the possibility of a view; (6) the interest in
having local controversies decided at home; and (7) the
interests of justice.
re Campbell Transp. Co., Inc., 368 F.Supp.2d 553, 555-56
(N.D. W.Va. 2005) (citing Alpha Welding & Fabricating
Co. v. ToddHeller, Inc., 837 F.Supp. 172, 175
(S.D. W.Va. 1993)). The movants typically bear the burden of
demonstrating that transfer is proper. Versol B.V. v.
Hunter Douglas, Inc., 806 F.Supp. 582, 592 (E.D. Va.
1992). The Supreme Court of the United States has further
stated that “unless the balance is strongly in favor of