UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NORTH CAROLNIA WESTERN DIVISION Case No. 5:20-CV-46-M

ACCREDITATION COMMISSION FOR HEALTH CARE, INC., Plaintiff, OPINION AND ORDER NEXTLOGIK, INC., Defendant.

This matter is before the Court on Defendant NextLOGiK, Inc.’s “Motion to Dismiss or, . in the alternative, Motion to Transfer Venue.” [DE-31 (the “Motion”).] Defendant invokes forum non conveniens, Federal Rule of Civil Procedure 12(b)(3), 28 U.S.C. § 1406(a), and 28 U.S.C. § 1404(a) in support of its Motion, arguing that venue is proper and more convenient in the United States District Court for the District of Maryland and dismissal or transfer is warranted. For the reasons set forth below, dismissal is not warranted and the Court, in its discretion, declines to transfer the case to the District of Maryland. The Motion is DENIED. I. Factual Background The facts alleged in the pleadings and the parties’ declarations may be summarized as follows. [See DE-19 (“Amended Complaint” or ““AC’”); DE-32-2 (Def.’s Dec. of Ed Mooers); DE-S50 (Pl.’s Dec. of Jillian Piccicuto); DE-51 (Pl.’s Dec. of Jose Domingos); DE-52 (Pl.’s Dec. of Robert Gardner).]'

' The Court may consider evidence outside the pleadings when considering the instant Motion. See, e.g., Aggarao v. MOL Ship Mgmt. Co., 675 F.3d 355, 366 (4th Cir. 2012) (“On a motion to dismiss under Rule 12(b)(3), the court is permitted to consider evidence outside the pleadings.” (citation omitted)); Mitchell v. Norfolk S. Ry. Co., No. 2:15CV00002, 2015 WL 5285827, at *1

Plaintiff Accreditation Commission for Health Care, Inc. (“‘ACHC” or “Plaintiff”) is a non-profit accreditation service provider incorporated under the laws of North Carolina with its principal office located in Cary, North Carolina. [AC 4 8.] Defendant NextLOGiK, Inc. (“NextLOGiK” or “Defendant’”) is a software-technology company incorporated in Maryland with its principal office in Columbia, Maryland. [AC 4 9; DE-32 at 2.] In September 2017, Plaintiff contracted with Defendant to develop, provide, and service a customized management software system to support Plaintiffs accreditation and business operations, including in this District. [AC 4 2; DE-49 at 13.] A. Requests for Proposal and Contract Execution In early 2017, Plaintiff issued a request for proposals (“RFP”), seeking vendors which could develop new management software for its business. [AC 4 21.] Defendant responded, and on or about April 24, 2017, representatives of NextLOGiK traveled to ACHC’s Cary offices to discuss the RFP. [AC § 22-23.] In May 2017, Plaintiff selected Defendant as the ‘winner’ of the RFP process. [AC 4 26.] Thereafter, the parties negotiated a contract; NextLOGiK’s then-CEO signed the contract on September 5, 2017, and Plaintiff's then-Vice President of Finance and Operations executed the contract from Plaintiff's Cary offices on September 11, 2017. [AC 26-27.] The contract included a provision whereby the parties agreed that any dispute involving the contract “be governed by and construed in accordance with the laws of the State of Maryland.” [DE-32 at 5; DE-32-1 at § 11.6.]

n.2 (W.D. Va. Sept. 8, 2015) (“When reviewing a motion to transfer under § 1404(a), the court may consider evidence outside the pleadings.”).

B. Performance of the Contract . The contract described a cooperative development process and provided that the parties would meet and discuss Plaintiffs needs so that Defendant could develop an effective software tailored to Plaintiff's business operations. [AC § 31.] The parties agreed that Plaintiff could use the software and that Defendant would support Plaintiffs use thereof for a term of eight years, with three one-year renewal options. [AC 29, 35.] Between October 2017 and October 2019, representatives of NextLOGiK visited ACHC’s Cary offices approximately ten times to meet with Plaintiff's representatives and perform work on the contact, and ACHC visited NextLOGiK’s Maryland offices once. [DE-49 at 6-7; DE-50; DE-52.] Plaintiff estimates that its employees, based in Cary, North Carolina, spent approximately 2,000 hours working on the contract between September 2017 and February 2020. [DE-49 at 6; DE-50 § 12.] Defendant states that its portion of the contract performance and software development occurred at its Maryland offices, and that the software was stored on servers in Baltimore, Maryland. [DE-32 at 3-4.] Plaintiff alleges that Defendant missed a series of performance deadlines and provided an incomplete and unsatisfactory software product. On December 27, 2019, Plaintiff sent Defendant a Notice of Breach, describing Defendant’s alleged material breaches and giving Defendant thirty days to cure the same. [AC § 109-10.] Defendant allegedly failed to cure the noted breaches within the thirty-day period, and Plaintiff initiated this action on February 6, 2020. [AC ¥ 111.] Il. Motion to Dismiss In the portion of Defendant’s Motion seeking dismissal, Defendant cites forum non conveniens, Federal Rule of Civil Procedure 12(b)(3), and 28 U.S.C. § 1406(a). The Court addresses each in turn.

A. Forum Non Conveniens Defendant first cites the general proposition that “[t]he doctrine of forum non conveniens permits a court to dismiss an action over which it has jurisdiction when there is an adequate alternative forum in which the case can be more conveniently heard,” and argues that the federal district court in Maryland is a more convenient alternative forum. [DE-32 at 7.] But, the doctrine of forum non conveniens does not apply where, like here, a party seeks to transfer a case from one federal district court to another federal district court. ““The common- law doctrine of forum non conveniens has continuing application [in federal courts] only in cases where the alternative forum is abroad, and perhaps in rare instances where a state or territorial court serves litigational convenience best.” Sinochem Int’l Co. v. Malaysia Int'l Shipping Corp., 549 U.S. 422, 430 (2007) (brackets in original) (citations and internal quotation marks omitted); see also Deb v. SIRVA, Inc., 832 F.3d 800, 805 (7th Cir. 2016) (Today, the doctrine applies in the federal courts only when the other jurisdiction is a foreign one.” (footnote omitted)). Defendant’s Motion does not refer to any state or foreign forum; instead, Defendant refers only to transfer to the United States District Court for the District of Maryland, and the Court declines to read any other request into the Motion. [See, e.g., DE-32 at 1 (“to the United States District Court for the District of Maryland, Northern Division”), 7 (“transfer to the United States District Court for the District of Maryland”), 9 (‘justify transfer to the District of Maryland”), 11 (“District of Maryland’’).] Instead, transfers between two federal courts are accomplished through the federal transfer statute, 28 U.S.C § 1404, which Defendant also invokes here. See Sinochem Int’l Co., 549 U.S. at 430 (“For the federal court system, Congress has codified the doctrine and has provided for transfer, rather than dismissal, when a sister federal court is the more convenient place for trial of the action.” (citing 28 U.S.C. § 1404(a)). Defendant’s attempt to seek this relief through forum non conveniens is denied as improper.

B. Federal Rule of Civil Procedure 12(b)(3) and 28 U.S.C. § 1406(a) Defendant next invokes Fed. R. Civ. P. 12(b)(3) and 28 U.S.C. § 1406(a), arguing that venue is proper in the District of Maryland and that the Court should transfer the matter under § 1406(a) because the location of key witnesses and evidence “constitutes an impediment to a decision on the merits in the transferor district but would not be an impediment in the transferee district.” [DE-32 at 8 (citing Porter v. Groat, 840 F.2d 255, 257-58 (4th Cir. 1988)); see also id. at 11.]

justice.” Trustees of the Plumbers & Pipefitters Nat’l Pension Fund v. Plumbing Servs., Inc., 791 F.3d 436, 444 (4th Cir. 2015). “As a court considers such factors, it is mindful that the ultimate decision of whether transfer is appropriate is not reached by cataloguing the weighted result of each factor, but rather is within the ‘art of judging.’” Golden Corral Franchising Sys., Inc. v. GC of Vineland, LLC, No. 5:19-CV-255-BO, 2020 WL 1312863, at *2 (E.D.N.C. Mar. 17, 2020) (citation omitted). B. Analysis Defendant has raised serious arguments in favor of transfer, but, in light of the weight accorded to Plaintiff's choice of forum, the Court finds that the case should be retained in this District.

tasks in connection with the contract in this District; Defendant’s representatives visited Plaintiff's office in Cary eleven times, including the initial solicitation meeting—Plaintiff s representatives visited Defendant’s office in Maryland once; and the ultimate goal of the project was the production of a custom software for use in this District. “[T]he plaintiffs initial choice of forum is entitled to deference and ‘should rarely be disturbed.”” WPB Partners, LLC v. Old Republic Nat. Title Ins. Co., No. 5:12-CV-132-F, 2013 WL 395112, at *4 (E.D.N.C. Jan. 31, 2013) (citations omitted); see also Longo v. Trojan Horse Ltd., 992 F. Supp. 2d 612, 619 (E.D.N.C. 2014) (“The Court is also mindful that ‘a plaintiff's choice of forum is a paramount consideration... that ... should not be lightly disturbed.’” (citation omitted)). Defendant has provided no compelling reason to retreat from that deference.

witnesses’ residing in the different forums difficult” (citations omitted)). See also Triangle Grading & Paving, Inc. v. Rhino Servs., LLC, No. 1:19CV486; 2020 WL 2086188, at[*19] (M.D.N.C. Apr. 30, 2020) (“To carry its burden the moving party must demonstrate whether its witnesses are willing to travel to a foreign jurisdiction. ... Though Defendants contend, not unreasonably, that more witnesses are located in Georgia, they do not offer the court a specific example of any Georgia witness who is unwilling to travel to North Carolina. The [] factor, therefore, weighs in favor of denying the motion.” (citation and internal quotation marks omitted)). Defendant has generally identified the non-party witnesses as “former employee[s]” who may “address a variety of issues, including allegations that the additional work” was necessary [DE-32 at 4, 17], but Defendant does not indicate whether those witnesses would be unwilling to appear voluntarily in this District [DE-32 at 16-17] nor does Defendant discuss the materiality of any specific testimony, particularly in light of the fact that Defendant’s current employees who worked on the software at issue could presumably testify to the same facts concerning its development [DE-32-2 4 23 (“The substantial majority of the Software Product design and licensing team was composed of approximately sixteen (16) NextLOGiK full-time employees... . some of whom are former employees” (emphasis added))]. Given the limited extent of Defendant’s showing, the presence of non-party witnesses in Maryland does not tip the scale in favor of transfer. Second, concerning party witnesses and the convenience of the parties, while Defendant is certainly correct that transfer to the District of Maryland would be more convenient for it and its own party witnesses, it would be equally inconvenient for Plaintiff and Plaintiff's party witnesses, all of whom work or reside in this District. [DE-49 at 8 (“All of ACHC’s key party witnesses work at its offices in this District.”)]; see Nuvotronics, LLC v. Luxtera, Inc., No.

7:13CV00478, 2014 WL 1329445, at *5 (W.D. Va. Apr. ^[2], 2014) (declining to transfer under § 1404(a) and finding that, absent more, transfer would “merely shift[] the balance of inconvenience to the plaintiff’ where one defendant had its “headquarters, operations, and employees” and the other defendant had “a satellite office” and a “sales office” in the proposed transferee district, but plaintiff's “principal place of business and relevant records” were in the Western District of Virginia). Finally, Defendant argues that all of the key documentary evidence, including the software product at issue, is in Maryland, and therefore transfer is appropriate. [DE-32 at 15- 16.] However, Plaintiff asserts that it, too, “possesses material documentary evidence in this District” and that, in any event, the location of such evidence is unimportant because it is electronic and easily transferable. [DE-49 at 21.] Defendant concedes that at least some of the relevant information, stored on its servers in Maryland, is electronically transferable. [DE-32 at 16 (“assuming, arguendo, NextLOGiK possesses [Plaintiff's] proprietary information, all information is stored on NextLOGiK’s Maryland site server and can be electronically transmitted to ACHC from the Maryland site.”); 3-4 (“Software product-at-issue . . . stored on NextLOGiK servers located in Baltimore, Maryland.”).] Without more, the Court is unable to determine which party has (and which district contains) relatively more material evidence and witnesses. Further, much of the documentary evidence—including the software at issue and information provided between the two parties—appears to be electronic and transferable. See Abbot Grp., LLC v. Hobie Cat Co., No. 107CV156, 2007 WL 1853413, at *3 (W.D.N.C. June 26, 2007) (“[T]he court finds this factor to be neutral inasmuch as electronically stored data is just as accessible in Asheville, North Carolina, as it would be in Oceanside, California.”). The location of evidence does not alter the balance in favor of transfer.

IV. Conclusion For the foregoing reasons, the Motion [DE-31] is DENIED. SO ORDERED, this the 20 day of August, 2020

Uf df ENV RICHARD E. MYERS II UNITED STATES DISTRICT JUDGE