Schultz v. The Harry S. Truman Scholarship Found.

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BRENDAN SCHULTZ, Plaintiff, v. THE HARRY S. TRUMAN SCHOLARSHIP FOUNDATION, Defendant.

No. 20-cv-04058-MMC

United States District Court, N.D. California

August 25, 2022

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS OR TRANSFER; DISMISSING SECOND AMENDED COMPLAINT WITH LEAVE TO AMEND

RE: DKT. NO. 34

MAXINE M. CHESNEY, United States District Judge

Before the Court is defendant Harry S. Truman Scholarship Foundation's (“Foundation”) “Motion to Dismiss Second Amended Complaint, or in the Alternative, to Transfer to the U.S. District Court for the District of Columbia,” filed June 6, 2022. On June 20, 2022 plaintiff Brendan Schultz (“Schultz”) filed his “Response to Defendant's Notice of Motion and Motion to Dismiss Second Amended Complaint,” to which the Foundation has replied. Having read and considered the parties' respective written submissions, the Court rules as follows.^[1]

BACKGROUND

In his Second Amended Complaint (“SAC”), as limited by prior order (see Order Dismissing in Part Second Am Compl. Pursuant to 28 U.S.C. § 1915 (“Section 1915 Order”), Dkt. No. 22), Schultz alleges the Foundation violated his rights under the Fifth Amendment and the Administrative Procedure Act, 5 U.S.C. § 701 et seq. (“APA”), by discriminating against him in the review of his application for a Harry S. Truman Scholarship (“Scholarship”) and in the review of his subsequent grievance.

In support thereof, Schultz alleges the following:

At his finalist interview for the Scholarship, the “Foundation, Brooks Allen, and Kevin Higgins^[2] discriminated against [him] by treating [him] differently than non-Jewish finalists, asking [him] frivolous questions . . . that non-Jew finalists were not asked, asking [him] discriminatory questions regarding the positionality of Jews in the United States[,] asking questions to intentionally elicit an emotional response from [him], laughing at [him], and creating a hostile interview environment for [him].” (See SAC ¶ 45.) Specifically, Kevin Higgins asked him “demeaning and inappropriate” questions (see SAC 13.c) including, “Do you think that Jews are oppressed?” and “Are Jews as oppressed as racial minorities in the United States?” (see SAC ¶ 13.f), and, upon Schultz's expressing a desire to run for elected office, Brooks Allen's “smirks turned to a discernable laugh” (see SAC ¶ 13.g).

When Schultz did not receive a Scholarship, and believing he faced discrimination on the basis of his Jewish identity, he reported his concerns to the Foundation, which conducted three investigations into his grievance, each arriving at the conclusion that the decision not to award Schultz a Scholarship was based on merit and not on his Jewish identity. According to Schultz, the Foundation, in conducting those investigations, failed to “objectively receive, address, and rectify [his] complaint of discrimination based on his Jewish identity in a fair and timely manner” (see SAC ¶ 65), and, although required to do so, had failed to develop procedures “to receive and address complaints” (see SAC ¶ 60).

Based on the above allegations, Schultz seeks injunctive relief on his remaining claims.

DISCUSSION

By the instant motion, the Foundation seeks dismissal/transfer on the ground of improper venue or transfer for convenience, and, in the alternative, dismissal of Schultz's claims for lack of standing and failure to state a claim.

A. Venue

At the outset, the Foundation moves to dismiss or transfer the instant case, pursuant to 28 U.S.C. § 1406(a) and Rule 12(b)(3) of the Federal Rules of Civil Procedure, on the asserted ground of improper venue.

“Because the defendant[] ha[s] challenged venue, the burden is on the plaintiff[] to demonstrate that venue is proper in the Northern District of California.” See Saravia v. Sessions, 280 F.Supp.3d 1168, 1188 (N.D. Cal. 2017), aff'd, 905 F.3d 1137 (9th Cir. 2018). Here, Schultz, alleging the Foundation “brought [him] to the Northern District of California to interview” and “[i]t was in conducting this interview . . . that [his] civil rights were violated” (see SAC ¶ 2), asserts venue is proper in this district.

Because Schultz has sued an agency of the United States, the propriety of venue is governed by 28 U.S.C. § 1391(e), which provides:

A civil action in which a defendant is an officer or employee of the United States or any agency thereof acting in his official capacity or under color of legal authority, or an agency of the United States, or the United States, may, except as otherwise provided by law, be brought in any judicial district in which (A) a defendant in the action resides, (B) a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated, or (C) the plaintiff resides if no real property is involved in the action.

See 28 U.S.C. § 1391 (e). Here, venue is not proper under subsection (e)(A), as the Foundation “resides in Washington, D.C.” (see Def.'s Mot. at 10:28), nor is venue proper under subsection (e)(C), as Schultz “resides in Honolulu” (see Pl.'s Resp. at 2:19). Consequently, venue will be proper in the Northern District of California only if “a substantial part of the events or omissions giving rise to the claim occurred” in this district. See § 1391(e)(B).

“To determine whether a substantial part of the events giving rise to the claim occurred in the forum, the court first considers what acts or omissions by the defendants give rise to the plaintiffs' claims,” and “[a]fter identifying the alleged wrongful acts, the court must determine whether a substantial part of those acts took place in the forum.” See Saravia, 280 F.Supp.3d at 1189 (internal quotation, citation, and alteration omitted); see also Emps. Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1165-66 (10th Cir. 2010) (noting “venue is not limited to the district with the most substantial events or omissions” and “can be appropriate in more than one district” (emphasis in original)).

Here, Schultz's Fifth Amendment and APA claims against the Foundation arise from events that occurred in San Francisco, California, and Washington, D.C., in particular, the panel's alleged discrimination against him at his finalist interview, which occurred in San Francisco, and the Foundation's acceptance of the panel's allegedly biased recommendation as well as its inadequate review of his grievance, which events, according to the Foundation and Schultz does not dispute, occurred in Washington, D.C.

The Foundation argues the “interview at which the offending questions were asked . . . does not constitute a substantial part of [Schultz's] claims,” because both “[t]he ultimate decision not to select [Schultz] as a Truman Scholar” and “the investigation into [Schultz's] complaints occurred in Washington D.C.” (See Def.'s Mot. at 11:22-27.) The propriety of venue, however, “does not require that a majority of the ‘events or omissions' occur in [the] district,” see Klingbeil v. Am. Eng'g Servs., 2007 WL 9776638, at *5 (S.D. Cal. Mar. 2, 2007), or that the district be “the best venue,” see Bates v. C & S Adjusters, Inc., 980 F.2d 865, 867 (2d Cir. 1992), and as Schultz points out, “the interview in which the [alleged] discrimination took place,” i.e. the pivotal event in the case, “was in San Francisco” (see Pl.'s Resp. at 2:17); see also Uffner v. La Reunion Francaise, S.A., 244 F.3d 38, 43 (1st Cir. 2001) (holding, where plaintiff brought bad faith action based on denial of coverage for sunken yacht, venue proper in Puerto Rico despite insurance contract formation and defendants' coverage decision having occurred outside Puerto Rico; finding sinking of yacht in Puerto Rico “was one part of the historical predicate for the . . . suit” and constituted “substantial” event).

Accordingly, the Court finds venue is proper in the Northern District of California.

B. Transfer for Convenience

The Foundation, in the event venue is deemed proper in this district, moves to transfer the instant case pursuant to 28 U.S.C. § 1404(a), under which “[f]or the convenience of 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.” See 28 U.S.C. § 1404(a).

Here, the action “might have been brought” in the District of Columbia, where venue is also proper because, as set forth above, the Foundation resides in Washington, D.C., and a substantial part of the events giving rise to Schultz's claims occurred there.

The Court next considers whether a transfer to the District of Columbia is warranted “[f]or the convenience of parties and witnesses” and “in the interest of justice.” See 28 U.S.C. § 1404(a). In deciding whether transfer is appropriate, courts consider a number of factors, including: “(1) the plaintiff's choice of forum; (2) the convenience of witnesses and the parties; (3) the familiarity of the forum with the applicable law; (4) the ease of access to evidence; and (5) the relative court congestion and time of trial in each forum.” See Patten v. Hancock, 2016 WL 693233, at *1 (N.D. Cal. Feb. 22, 2016). “The burden is on the party seeking transfer to show that when these factors are applied, the balance of convenience clearly favors transfer,” and transfer will “not be allowed if the result is merely to shift the inconvenience from one party to another.” See Lax v. Toyota Motor Corp., 65 F.Supp.3d 772, 776 (N.D. Cal. 2014) (noting “[i]t is not enough for the defendant to merely show that it prefers another forum”). The Court next turns to the above-listed factors, and, as discussed below, finds the balance does not favor transfer.

First although “[t]he general...