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Bigland v. FCA North America Holdings, LLC

United States District Court, E.D. Michigan, Southern Division

October 7, 2019

REID BIGLAND, Plaintiff,
v.
FCA NORTH AMERICA HOLDINGS, LLC; et al ., Defendants.

          OPINION AND ORDER DENYING DEFENDANTS' MOTION TO TRANSFER UNDER 28 U.S.C. § 1404(A), AND, ALTERNATIVELY, TO DISMISS UNDER RULE 12(B)(6) [#18] AND DENYING WITHOUT PREJUDICE PLAINTIFF'S MOTION FOR LEAVE TO FILE SECOND AMENDED COMPLAINT [#17]

          GERSHWIN A. DRAIN UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         Defendants removed the instant action from the Oakland County Circuit Court on June 5, 2019. Plaintiff Reid Bigland filed a First Amended Complaint on June 12, 2019, raising claims under the Whistleblowers' Protection Act, Mich. Comp. Laws § 15.361 et seq., the Dodd-Frank Wall Street Reform and Consumer Protection Act, 15 U.S.C. § 78u-6, as well as a claim alleging violation of Michigan public policy and a claim for unjust enrichment.

         Presently before the Court is the Defendants FCA North America Holdings, LLC's, FCA U.S. LLC's and Fiat Chrysler Automobiles, N.V.'s Motion to Transfer under 28 U.S.C. § 1404(a) and, Alternatively, to Dismiss under Rule 12(b)(6), filed on June 25, 2019. Plaintiff filed a Response in Opposition on July 17, 2019 and Defendants filed a Reply brief on July 31, 2019. Also, before the Court is the Plaintiff's Motion for Leave to File Second Amended Complaint, filed on June 24, 2019. Defendants filed a Response on July 8, 2019 and Plaintiff filed his Reply on July 15, 2019. A hearing on these matters was held on October 3, 2019.

         For the reasons that follow, the Court will deny Defendants' Motion to Transfer and, Alternatively, to Dismiss under Rule 12(b)(6) and will deny without prejudice Plaintiff's Motion for Leave to File Second Amended Complaint.

         II. FACTUAL BACKGROUND

         Plaintiff has worked for what is now Defendant Fiat Chrysler Automotive, N.V. since 1997. ECF No. 10, PageID.73. Plaintiff has been promoted numerous times during his employment with Defendant and currently has the following positions at the company: Chairman, President, and CEO of Fiat Chrysler Canada; Head of U.S. Sales; Head of U.S. Fleet; and Global Head of Ram Brand. Id. at PageID.76. Plaintiff also sits on several corporate decision-making committees. Id. at PageID.77.

         Due to litigation filed by a dealership owner and investors regarding Defendants' monthly sales reporting, Defendants' Internal Audit and Legal departments analyzed Defendants' monthly sales reporting practices and found no wrongdoing. Id. at PageID.80. However, at the suggestion of counsel, Defendants self-reported their methodology for reporting monthly sales to the U.S. Securities and Exchange Commission (“SEC”). Id. In July of 2016, Defendant Fiat Chrysler Automobiles N.V. voluntarily changed its system for reporting monthly sales and restated its monthly sales numbers for the previous five years to reflect its new reporting methodology. Id.

         Based on Defendants' self-report to the SEC, the SEC began an investigation into Defendants' former monthly sales reporting practices. Id. As part of the investigation, the SEC requested that Plaintiff meet with investigators. Id. at PageID. 81. Plaintiff testified under oath before the SEC that the monthly sales reporting practices at issue were in place long before Plaintiff became Head of U.S. Sales and that he followed these procedures. Id. at PageID.81. In late 2018, the SEC suggested that Plaintiff admit to some wrongdoing as to Defendants' monthly sales reporting. Id. The SEC also suggested a resolution involving some penalty to FCA. Id. Because Plaintiff did not engage in any wrongdoing, he declined to admit any wrongdoing. Id.

         As of late 2018, Plaintiff believed that the SEC did not have an accurate understanding of Defendants' reporting methodologies. Id. at PageID.82. In order to ensure that the SEC had all relevant information, Plaintiff submitted a White Paper to the SEC in early 2019 which set forth the monthly sales reporting methodology he inherited, his use of this protocol, Defendants' knowledge of the methodology and, lastly, Plaintiff summarized his testimony before the SEC. Id. Plaintiff provided Defendants a copy of the White Paper prior to submitting it to the SEC. Id.

         Plaintiff asserts that his unwillingness to act as a scapegoat for Defendants' 30-year sales reporting methodology and candor regarding Defendants' knowledge of this practice prior to and during Plaintiff's tenure as head of U.S. Sales caused Defendants to retaliate against Plaintiff less than two months after submission of the White Paper. Id. at PageID.84. Specifically, Plaintiff maintains that Defendants have retaliated by withholding some of Plaintiff's compensation. Id. Plaintiff's compensation consists of three components: base pay; an annual bonus; and “Long Term Incentive” stock options. Id. at PageID.77. With no forewarning, on March 8, 2019, Global Human Resources Chief Linda Knoll advised Plaintiff that Defendants had decided to indefinitely defer his annual bonus for 2018 and payout of shares. Id. at PageID.84. While Defendants alluded to an internal investigation, Plaintiff has never been given a specific reason behind the Defendants' decision to withhold Plaintiff's compensation. Id. However, he was informed that Defendants were angry that he sold his shares in the company, and Defendants have admitted that his compensation was withheld, in part, because of this sale. Id. at PageID.85.

         III. LAW & ANALYSIS

         A. Motion to Transfer and/or Motion to Dismiss

         1. Standard of Review

         Title 28 U.S.C. § 1404(a) provides that “[f]or the convenience of the parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.” Continental Grain Co. v. Barge F.B.L.-585, 364 U.S. 19, 27 (1960). The district court has broad discretion to grant or deny a motion to transfer, so long as jurisdiction is proper in either court. Phelps v. McClellan, 30 F.3d 658, 663 (6th Cir. 1994).

         There are several factors the district courts should consider when deciding whether or not to transfer under 28 U.S.C. § 1404(a). Moses v. Business Card Express, Inc., 929 F.2d 1131, 1137 (6th Cir. 1991). The private interest factors include (1) convenience of the parties and witnesses, (2) accessibility of sources of proof, (3) the costs of securing testimony from witnesses, (4) practical problems associated with trying the case in the least expensive and most expeditious fashion, and (5) the interests of justice. Id. The public interest factors include (1) the relative congestion in the courts of the two forums, (2) the public's interest in having local controversies adjudicated locally, and (3) the relative familiarity of the two courts with the applicable law. Id. In the ordinary case, the party seeking a § 1404(a) transfer must bear the burden of establishing the existing forum is inconvenient. Amphion, Inc. v. Buckeye Elec. Co., 285 F.Supp.2d 943, 946 (E.D. Mich. 2003).

         However, when evaluating a § 1404(a) request for transfer premised on a valid, mandatory and enforceable forum selection clause, the § 1404(a) analysis changes. Atl. Marine Constr. Co. v. United States Dist. Court, 571 U.S. 49, 63 (2013) (“The presence of a valid forum-selection clause requires district courts to adjust their usual § 1404(a) analysis . . . .”). In this situation, the plaintiff's choice of forum is given no weight and the plaintiff “must bear the burden of showing why the court should not transfer the case to the forum to which the parties agreed.” Id. Additionally, “a court evaluating a defendant's § 1404(a) motion to transfer based on a forum-selection clause should not consider arguments about the parties' private interests.” Id. Rather, the court is to evaluate public interest factors only. Id. Where the parties have agreed to a valid forum selection clause, the district court should ordinarily transfer the case to the forum specified in the clause because “[i]n all but the most unusual cases, [] the interest of justice is served by holding parties to their bargain.” Id. at 66.

         2. The Operative Agreements

         Defendants move this Court to transfer this action to the U.S. District Court for the District of Delaware, or, alternatively, to dismiss the Amended Complaint on the grounds that pursuant to a valid forum selection clause, Plaintiff and Defendants agreed that any dispute between Plaintiff and Defendants regarding the terms of Plaintiff's equity awards would be exclusively brought in federal or state court in Delaware.

         Specifically, Defendants refer the Court to the Equity Incentive Plan (the “Plan”), which designates Delaware as the exclusive ...


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