Construction Law Insights

United States ex rel. Allan Myers Va v. Westfield Ins. Co, 2021 U.S. Dist. LEXIS 240864, 2021 WL 5882040 (E.D. Va. Dec. 13, 2021)

In this Miller Act case, the Court granted Ocean Construction Services, Inc.’s (“Ocean”) Motion to Transfer venue from the Alexandria Division to the Norfolk Division of the United States District Court for the Eastern District of Virginia, which was joined by Westfield Insurance Company (“Westfield”) and opposed by Allan Myers Va, Inc. (“Allan Myers”), Fidelity & Deposit Company of Maryland (“Fidelity”), and Berkshire Hathaway Specialty Insurance Company (“Berkshire”).

28 U.S.C. § 1404(a) permits transfer only to a venue where an action might have been brought in the first place. The contract between Ocean and Allan Myers contained a forum selection clause that required all disputes be brought in the Circuit Court for the City of Virginia Beach, which the parties opposing the transfer argued was not a proper venue under the Miller Act. The Miller Act requires actions be brought in the United States District Court for any district in which the contract was to be performed and executed. The contract between Ocean and Allan Myers was for work in the Eastern District of Virginia, so the contract’s selection of a venue within the Eastern District of Virginia would have permitted Allan Myers to file a suit in the Norfolk Division. Also, parties may waive the Miller Act’s venue provision by contract. Finding that the venue was permitted by the Miller Act, the Court considered the § 1404(a) factors of: (1) the weight accorded to plaintiff’s choice of venue; (2) witnesses’ convenience and access; (3) convenience of the parties; and (4) the interests of justice. A motion to transfer to a venue designated by contract will be granted in all but the most exceptional cases. Faced with a forum selection provision, no weight is given to the first factor and the court cannot consider arguments about a party’s private interests with respect to the convenience factors. Also, the interest of justice weighed in favor of the venue transfer because the enforcement of valid forum selection clauses, bargained for by the parties, protects their legitimate expectations and furthers the vital interests of the justice system.

PLDR Law Scott Kowalski 1 PLDR Law Mark Burgin 1

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