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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Brooks Range Petroleum Corporation v. Shearer (7/27/2018) sp-7266

Brooks Range Petroleum Corporation v. Shearer (7/27/2018) sp-7266

           Notice:   This opinion is subject to correction before publication in the P                    ACIFIC  REPORTER.  

           Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,  


           303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email  



                       THE SUPREME COURT OF THE STATE OF ALASKA                                       

BROOKS  RANGE  PETROLEUM                                         )  

CORPORATION,                                                     )          Supreme Court Nos. S-16382  




                                                                 )          Superior Court No. 2BA-15-00300 CI  



                      v.                                         )         O P I N I O N  



DANIEL P. SHEARER,                                                                                           

                                                                 )         No. 7266 - July 27, 2018  


                                Respondent.                      )  




                      Petition for Review from the Superior Court of the State of  


                      Alaska, Second Judicial District, Barrow, Angela Greene,  



                      Appearances:             Elizabeth  Hodes  and  Anne  Marie  Tavella,  


                      Davis  Wright  Tremaine  LLP,  Anchorage,  for  Petitioner.  


                      James K. Wilkens, Bliss Wilkens, Anchorage, and Robert  


                      Campbell, Caliber Law Group, Barrow, for Respondent.  


                      Before:  Stowers, Chief Justice, Winfree, Maassen, Bolger,  


                      and Carney, Justices.  


                      MAASSEN, Justice.  



                      We  granted  a  petition  for  review  to  resolve  a  venue  dispute  in  an  


employment case.  Daniel Shearer alleges that Brooks Range Petroleum Corporation  


(BRPC) promised him a ten-year term of employment, then terminated his employment  


two and a half years later.  Shearer filed suit in the Second Judicial District, where he  

----------------------- Page 2-----------------------

alleged the parties had negotiated and formed their contract.                                                                                              BRPC filed a motion to                                   

dismiss the case or to change venue to the Third Judicial District, where the contract was                                                                                                                     

executed and where Shearer had performed most of his job duties.  The superior court                                                

denied the motion, thus retaining venue in the Second Judicial District.                                                                                      

                                 WeconcludethatneitherShearer's tort claimsnorhis                                                                                  contract-based claims  

arose in the Second Judicial District, and the chosen venue was therefore not proper. We                                                                                                                        

reverse the superior court's order denying a change of venue.                                                                             

II.              FACTS AND PROCEEDINGS                

                 A.               Facts  

                                  Some of the factual background of this case is controverted.  Where there  


is a reasonable dispute, we construe the facts in Shearer's favor.1  



                                  Shearer, a resident of Alberta, Canada, alleged that in October 2011 he was  

"working as a drilling consultant for British Petroleum" (BP) when he was "presented  


an attractive offer of full time employment with BP."  While considering BP's offer,  


Shearer learned that the "key drilling consultant" for another North Slope operator,  


BRPC,  had  suffered a heart attack,  and  he "volunteered  to  help."                                                                                                          He covered  the  


consultant  position  for  BRPC  during  January  2012  at  the  Mustang  location  near  




                                 While working there Shearer was approached by John Jay "Bo" Darrah,  


BRPC's co-founder and then-chief executive officer, who "recruited" Shearer to "fill a  

                 1               See infra               Section IV.A.   

                 2               Nuiqsut is a village in the North Slope Borough, about 35 miles inland from  


the Bering Sea, east of Utqia                                               gvik (formerly known as Barrow).                                                              Both Nuiqsut and   

Utqiagvik are in the Second Judicial District.  Utqiagvik is the superior court location  


closest to Nuiqsut.                              

                                                                                                         -2-                                                                                                7266

----------------------- Page 3-----------------------

permanent full-time position with BRPC." Shearer told Darrah about BP's employment  


offer, "emphasizing the importance . . . of long-term employment security."  According  


to Shearer, he and Darrah "verbally confirm[ed] [a] guarantee of long-term employment  


security of at least 10 years . . . [and] shook hands on the agreement."  "In reliance on  


thesepromises and representations,"Shearer ceased negotiating for apermanent position  


with BP.  


                    On January 30, 2012, Shearer traveled to Anchorage and attended a dinner  


hosted by BRPC, where he was "welcomed and introduced as the 'new employee.' "  


The next day  the parties  executed  a  short  written employment contract at BRPC's  


Anchorage office, effective February 1, 2012.   The contract made no reference to a  


guaranteed term of employment.  


                    The parties dispute where the terms of their agreement were negotiated and  


accepted. Shearer contends that the agreement was fully negotiated at BRPC's Mustang  


location on the North Slope and that the written contract executed in Anchorage simply  


"memorializ[ed] the basic compensation terms of the verbal employment contract . . .  


reached earlier."  BRPC contends that it negotiated the material terms of the agreement  


and hired Shearer in Anchorage.  


                    The  parties  also  dispute  where  Shearer  was  expected  to  do  his  work.  


Shearer contends that he was hired to work primarily on the North Slope, though he  


concedes that he "would be expected to work in BRPC's Anchorage office during  


periods when there was no activity on the North Slope."  BRPC contends that "Shearer  


was hired to work as a Drilling Manager in BRPC's Anchorage, Alaska office," but it  


concedes that "Shearer did travel to the project site on the North Slope."  The parties  


agree that, as it turned out, Shearer worked primarily at BRPC's Anchorage office.  


                                                               -3-                                                         7266

----------------------- Page 4-----------------------

                    In  2014  Shearer  learned  that  BRPC  might  be  sold.                            He  met  with  the  


president and chief executive officer, Barton J. Armfield, and another BRPC employee,  


and he reminded them of Darrah's oral commitment to a ten-year employment term. But  


in August 2015 he "was verbally advised by Armfield that his employment would be  


terminated."  He was called the next day by another corporate officer, who advised him  


that "he would be receiving a letter informing him of his release from employment."  


BRPC asserts that its phone calls were made from Anchorage and the termination letter  


was sent from Anchorage to Shearer's home in Canada, which Shearer does not dispute.  


          B.        Proceedings  

                    Shearer sued BRPC for misrepresentation, breach of contract, and related  


claims.  He served the summons and complaint on Armfield, BRPC's registered agent,  


in Anchorage in the Third Judicial District, but he filed his suit in Utqiagvik in the  


Second Judicial District.  The parties dispute the location of BRPC's principal place of  


business:  Shearer's complaint asserted that it was on the "North Slope, Alaska," but  


BRPC responded that it was in Anchorage.  In an affidavit filed in support of BRPC's  


motion to change venue, Armfield asserted that it "does not maintain any permanent  


offices or employees in the Second Judicial District or Barrow [Utqiagvik]" and that it  


"currently ha[d] no employees or active operations in" the Second Judicial District.  In  


a responsive affidavit Shearer asserted that he was "informed and believe[d] there [was]  


current activity at BRPC's Mustang Pad" on the North Slope and that he also believed  


"that BRPC [was] in the process of designing a production facility that [would] be  


situated near Nuiqsut, within the Second Judicial District."  


                    BRPC filed a motion to dismiss for improper venue or alternatively to  


transfer  venue  to  Anchorage  in  the  Third  Judicial  District.                             The  superior  court  in  


Utqiagvik considered the parties' pleadings and affidavits and denied the motion.  It  


                                                               -4-                                                        7266

----------------------- Page 5-----------------------

decided that Shearer's contract claims arose in Anchorage for venue purposes because  


that was "theplaceofintendedperformancefor Shearer'semploymentcontract," but that  


his tort claims arose in the Second Judicial District because he "was first injured when  


he relied on BRPC's alleged misrepresentations in Nuiqsut" by "ceas[ing] negotiations  


with BP."  


                    To decide whether venue for the two different types of claims could remain  


in Utqiagvik, the court weighed the private interests of the litigants and the interests of  


the public.  It noted that Shearer had a private interest in the venue of his choice but that  


"it would be easier and cheaper for BRPC to litigate the case in Anchorage"; "it is likely  


that most of the witnesses reside in Anchorage"; "it would be easier for witnesses outside  


of Alaska to travel to Anchorage" than to Utqiagvik; and "most of the evidence is in  


Anchorage."  But the court also noted that the cost of transporting employment records  


from Anchorage to Utqiagvik was "minimal given that the entire contents could be put  


on a thumb drive or CD" and that "[w]itnesses c[ould] be deposed in Anchorage,"  


though they "would have to testify in [Utqiagvik] if the parties felt it necessary to have  


the live testimony."  


                    The superior court decided that these private interests were outweighed by  


the public interest of "the local community . . . in having this controversy decided on the  


North  Slope  because  a  significant  portion  of  the  alleged  wrongdoing  occurred  in  


Nuiqsut."  The court concluded that because BRPC chose to do business on the North  


Slope - whose residents "work in those jobs and depend on the money to sustain them"  


- local jurors had "a stake in the matter" that weighed heavily in favor of retaining  


venue in the Second Judicial District.   The court also declined to transfer venue on  


                                                                -5-                                                         7266

----------------------- Page 6-----------------------

convenience grounds, finding that it was not necessary for "the convenience                                                                      of witnesses   


and the ends of justice."                         



                          The parties filed cross-petitions for review.                                          We granted BRPC's petition  


and asked the parties to address the following issues:  


                          (1)	         Where  did  the  claim  arise  for  the  alleged  tort  of  



                          (2)	         Where did the claim arise for the alleged breach  


                                       of contract?  


                          (3)	         Should we adopt the doctrine of ancillary (or  


                                       pendent) venue?  


                          (4)	         Did the superior court abuse its discretion in  


                                       denying                a      change               of       venue             under  


                                       AS 22.10.040?  


                          (5)	         How should we address issues of overlapping  





                          Whether the plaintiff's initial choice of venue is proper under Alaska Civil  


Rule 3(c) is a legal question we review de novo, applying our independent judgment to  



adopt the rule of law that is most persuasive in light of precedent, reason, and policy. 

             3            See  AS 22.10.040(2) ("The superior court in which the action is pending  

may change the place of trial in an action from one place . . . to a designated place in                                                                             

another judicial district . . . when the convenience of witnesses and the ends of justice                                                                   

would be promoted by the change.").                  

             4            Shearer's petition challenged only the superior court's factual finding that  


the parties intended his employment contract to be primarily performed in Anchorage.  


             5            See Wolff v. Cunningham, 187 P.3d 479, 482 (Alaska 2008) ("The superior  


court's interpretation of the civil rules presents a question of law that we review de  


novo."); Ketchikan Gen. Hosp. v. Dunnagan, 757 P.2d 57, 59 (Alaska 1988) (explaining  



                                                                                  -6-	                                                                         7266

----------------------- Page 7-----------------------

IV.         DISCUSSION  

                        Venue requirements "are designed to [e]nsure that litigation is lodged in a  


convenient forum and to protect the defendant against being sued in an arbitrary place."6  


Though important, venue has rarely been addressed in our case law.  In the discussion  


that follows we first address how trial courts should view the evidence on a motion based  


on improper venue. We then address the tests used to determine where tort and contract  


claims arise for venue purposes.  Applying those tests to Shearer's claims in this case,  

we decide that the Second Judicial District was not a proper venue because the claims  


did not arise there.  


            5            (...continued)  


that superior court's discretion when granting Rule 3 motion based on improper venue  


is limited to two choices:  transferring case to proper judicial district or, "if the court  


finds  that  the  plaintiff  acted  in  bad  faith,  or  if  the  interests  of  justice  so  require,"  


dismissing action). Our de novo review of decisions based on improper venue is distinct  


from our review of decisions whether to change venue from one proper Rule 3(c) venue  


to another under AS 22.10.040; those we review for an abuse of discretion.  See Maier  


v.  City of Ketchikan, 403 P.2d 34, 39 (Alaska 1965) ("Within the boundaries of [the  


statutory] standards, the decision as to whether venue will be changed is within the sound  


discretion of the superior court."), overruled on other grounds by Johnson v. City of  


Fairbanks, 583 P.2d 181, 187 (Alaska 1978).  

            6           4 C    HARLES   ALAN   WRIGHT, A                       RTHUR   R. M           ILLER   & A         DAM  N. S         TEINMAN,  


FEDERAL PRACTICE AND PROCEDURE  1063, at 330 (4th ed. 2015) (discussing federal                                                                  

venue requirements imposed by statute);                                    see also Leroy v. Great W. United Corp.                                  , 443   

U.S.  173, 183-84 (1979) ("In most instances, the purpose of statutorily specified venue                                                           

is   to  protect   the   defendant   against   the   risk   that   a   plaintiff   will   select   an   unfair   or  

inconvenient place of trial." (emphasis in original)).                                           

                                                                            -7-                                                                     7266

----------------------- Page 8-----------------------

                A.	            The Plaintiff Bears The Burden Of Proving Proper Venue; However,                                                                                   

                               Absent An Evidentiary Hearing, The Court Evaluates The Pleadings                                                                                   

                               In The Light Most Favorable To The Plaintiff.                                                 

                               By statute, "[v]enue for all actions shall be set under rules adopted by the                                   

supreme court."                      7  


                                         Alaska Civil Rule 3 governs venue. Actions involving real property are  


addressed by Rule 3(b); other civil actions are addressed by Rule 3(c).  "[P]laintiffs . . .  


must commence suit in [a] proper Rule 3 venue, and then, if that forum is inconvenient,  



move for a change of venue under AS 22.10.040."                                                                          "This rule precludes plaintiffs from  



selecting a forum they believe is convenient without regard to Civil Rule 3." 


                               Alaska Civil Rule 12(b) allows objections based on improper venue to be  


asserted  in  a  responsive  pleading  or  made  by  motion.                                                                              Because  our  Rule  12(b)  is  



substantially  similar  to  Federal  Rule  of  Civil  Procedure  12(b),                                                                                       we  look  to  federal  


practice for guidance in applying the rule. In the federal courts there is a split of authority  



over who bears the burden of proof on the question of proper venue.                                                                                                           Some courts  


require a moving defendant to bear the burden of proving that the plaintiff's choice of  



venue is improper,                              but an apparent majority - and what Professors Wright and Miller  

                7              AS  22.10.030.  

                8              Ketchikan  Gen.  Hosp.,  757  P.2d  at  59.  

                9              Id.  

                10              Compare   Alaska   R.   Civ.  P.  12(b),   with   Fed.   R.   Civ.   P.   12(b).   See  

                                    HARLES  ALAN  WRIGHT  &  ARTHUR  R.  MILLER,  FEDERAL  PRACTICE AND  

generally  5B C 

PROCEDURE  1352, at 322 (3d ed. 2004 & Supp. 2017).                                                                 


                11             WRIGHT  & M                     ILLER,  supra  note 10,  1352, at 320-22.                                  

                12             See, e.g.          ,  Myers v. Am. Dental Ass'n                                    , 695 F.2d 716, 724-25 (3d Cir. 1982);                                   

                                                                                                                                                                 RIGHT  & M                ILLER,  

 United States v. Orshek, 164 F.2d 741, 742 (8th Cir. 1947); see also W 


supra note 10,  1352, at 324.  

                                                                                                   -8-	                                                                                       7266

----------------------- Page 9-----------------------

deem the "correct" view - places the burden of proof on the plaintiff, reasoning that it                                                                                                                                                                      


is the plaintiff's obligation in the first instance to file suit in a proper forum.                                                                                                                                                   

                                        We follow the majority view, which is more consistent with our expectation  


                                                                                                                                                                                         14   To withstand a motion  

that plaintiffs will "commence suit in the proper Rule 3 venue."                                                                                                                                                                            


based on improper venue, the plaintiff must present a prima facie case that the chosen  


venue is proper.15  The trial court may consider evidence outside the pleadings but should  


take the plaintiff's uncontradicted allegations as true and construe reasonable inferences  


 and factual conflicts in favor of the plaintiff.16  


                                        "As a result, at least until facts are resolved, in many cases the non-moving  


party  will  survive  the  Rule  12(b)(3)  motion"  solely  because  of  the  lack  of  factual  


development.17   "To resolve such motions when genuine factual issues are raised, it may  


be appropriate for the [trial] court to hold a Rule 12(b)(3) motion in abeyance until [it]  


                    13                  See, e.g.               ,  Gulf Ins. Co. v. Glasbrenner                                                         , 417 F.3d 353, 355 (2d Cir. 2005);                                                 

Bartholomew v. Va. Chiropractors Ass'n                                                                                  , 612 F.2d 812, 816 (4th Cir. 1979),                                                                    abrogated  

on other grounds by Union Labor Life Ins. Co. v. Pireno                                                                                                           , 458 U.S. 119 (1982);                                           Piedmont  

Label Co. v. Sun Garden Packing Co.                                                                                  , 598 F.2d 491, 496 (9th Cir. 1979);                                                                             see also   

WRIGHT  & M                              ILLER,  supra  note 10,  1352, at 322.                                                       



                                       Ketchikan Gen. Hosp. v. Dunnagan, 757 P.2d 57, 59 (Alaska 1988).  

                    15                  See   Samson   Tug   &   Barge   Co.   v.   Koziol,   869   F.   Supp.   2d   1001,   1015  

 (D.  Alaska 2012) ("When considering a defendant's assertion of improper venue, the                                                                                                                                                                  

court may                        consider facts outside of the pleadings, with the burden on the plaintiff to                                                                                                                                            

demonstrate that venue properly lies in its chosen state.").                                                                                       

                    16                  See Home Ins. Co. v. Thomas Indus., Inc.                                                                                 , 896 F.2d 1352, 1355 (11th Cir.                                                   

 1990) ("When affidavits conflict, the court is inclined to give greater weight to the                                                                                                                                                                

plaintiff's version of the jurisdictional facts and to construe such facts in the light most                                                                                                                                                     

 favorable to the plaintiff."); W                                                         RIGHT  & M                       ILLER,  supra  note 10, at 322.                                         



                                       Murphy v. Schneider Nat'l, Inc., 362 F.3d 1133, 1139 (9th Cir. 2004).  

                                                                                                                             -9-                                                                                                                 7266

----------------------- Page 10-----------------------


holds an evidentiary hearing on the disputed facts."                                          Whether to hold a hearing is                   


committed to the trial court's discretion.                                                                                                  

                                                                      "Alternatively, the [trial] court may deny the  


Rule 12(b)(3) motion while granting leave to refile it if further development of the record  

                                                             20   If the court does hold an evidentiary hearing, the  



eliminates any genuine factual issue." 

plaintiff must prove that the chosen venue is proper by a preponderance of the evidence.21  



           B.	        The Second Judicial District Is Not A Proper Venue For Shearer's  


                      Misrepresentation Claims Because The Claims Did Not Arise There.  


                      As relevant here,  Rule 3(c)  provides that  "[i]f .  .  .  a defendant can  be  


personally served within a judicial district of the State of Alaska, the action may be  


commenced either in:  (1) the judicial district in which the claim arose; or (2) a judicial  


district  where  the  defendant  may  be  personally  served."                                       Shearer  served  BRPC  in  


Anchorage, in the Third Judicial District, and venue is proper there under Rule 3(c)(2).  


Shearer does not contend that BRPC could also have been personally served in the  


Second Judicial District; our focus is therefore on whether his "claim arose" there, which  


would make it an alternative proper venue under Rule 3(c)(1).  

           18         Id.  

           19         See  id.  

           20         Id. ;  see  also  Hancock  v.  AT&T ,  701  F.3d   1248,   1260-61  (10th  Cir.  2012)  

(approving  procedure   as   described  by  Ninth   Circuit   in  Murphy),  abrogated   on   other  

grounds  by  Atl.  Marine  Constr.  Co.  v.   U.S.  Dist.  Court,  571  U.S.  49  (2013).  

           21         Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005); Zaltz v.  


JDATE, 952 F. Supp. 2d 439, 447-48 (E.D.N.Y. 2013).  


                                                                     -10-	                                                            7266

----------------------- Page 11-----------------------

                                  Shearer's complaint alleges claims in both tort and contract. His tort claims,                                                                                             

                                                                                                   22                                                                                        23  

which we address first, are for negligent                                                                                                                                                                        

                                                                                                        and intentional misrepresentation.                                                         Both types  




of misrepresentation claims require that the plaintiff have suffered actual harm. 


                                  We first decided where a tort "claim arose" for venue purposes in Ebell v.  

                                                          25      At the time, venue in cases not involving real property was  


Seapac Fisheries, Inc. 

governed by AS 22.10.030(b) - since repealed - which presaged Civil Rule 3(c).  The  


 statute provided:  "If . . . a defendant can be personally served within a judicial district of  


                 22               The tort of negligent misrepresentation has these elements:                                                                                              

                                  (1)  the party accused of misrepresentation must have made                                                                                

                                  the statement in                            the   course of his business, profession or                                                           

                                  employment;   (2)   the   representation   must   supply   "false  

                                  information";    (3)    the    plaintiff    must    show    "justifiable  

                                  reliance" on the false information; and (4) the accused party                                                                              

                                  must have failed "to exercise reasonable care or competence                                                               

                                  in obtaining or communicating the information."                                                                               

Miller v. State, Dep't of Envtl. Conservation                                                                  , 353 P.3d 346, 348 (Alaska 2015) (quoting                                              

 Willard v. Khotol Servs. Corp.                                               , 171 P.3d 108, 118-19 (Alaska 2007)).                                           

                 23               "We have identified the elements of intentional misrepresentation as '(1) a  


misrepresentation of fact or intention, (2) made fraudulently (i.e., with scienter), (3) for  


the purpose of inducing another to act in reliance, (4) with justifiable reliance by the  


recipient, (5) causing loss.' " Anchorage Chrysler Ctr., Inc. v. DaimlerChrysler Motors  


 Corp. (AnchorageChryslerII),221 P.3d 977, 987-88 (Alaska2009) (quoting Anchorage  


 Chrysler Ctr., Inc. v. DaimlerChrysler Corp. (Anchorage Chrysler I), 129 P.3d 905, 914  


(Alaska 2006)).  


                 24               Bubbel v. Wien Air Alaska, Inc., 682 P.2d 374, 381 (Alaska 1984) ("[A]  


cause of action for negligent misrepresentation is complete when the injured party has  


 suffered a pecuniary loss as a result of the misrepresentation."); Anchorage Chrysler II ,  


221 P.3d at 987-88 (identifying fifth element of intentional misrepresentation as "loss"  


caused by the tortious conduct).  


                 25               692 P.2d 956 (Alaska 1984).  


                                                                                                          -11-                                                                                                 7266

----------------------- Page 12-----------------------

the state, the action against that defendant shall be commenced in that judicial district or                                                                                                             

in the judicial district in which the claim arose."                                                               The plaintiff in                    Ebell  alleged that a law                     

firm located in the Third Judicial District was negligent in failing to advise him of the                                                                                                             

need to comply with certain fisheries laws, "resulting in the seizure of [the plaintiff's]                                                                                          

                                                                                                                                           26      The seized vessels were  

vessels in Norton Sound in the Second Judicial District."                                                                                                                                        

ordered to Dutch Harbor in the Third Judicial District, where eventually the fish on board  


were forfeited "and other losses were incurred."27  


                               The plaintiff served the law firmwith a summons and complaint in the Third  


Judicial District, the firm's place of business, but filed suit in the Second.28   The superior  


court denied the defendants' motion to change venue, determining that the "claim arose"  


in the Second Judicial District where "the injury occurred."29                                                                                  This court affirmed.30   We  


observed that "[w]hen AS 22.10.030(b) was enacted in 1971, the 'claim arose' language  


had a generally understood meaning in the context of tort suits," which was that a claim  


"arose where the last event necessary to make the defendant liable for the tort took  


                 31    We further explained:  


                               The last event occurred when the harmful force, set in motion  


                               by the defendant's negligence, first took effect on the body or  


                               the property of the plaintiff. Thus, a claim for tort arose where  


                26             Id.  at 957.   

                27             Id.  

                28             Id.  

                29             Id.  

                30             Id.  

                31             Id.  

                                                                                                  -12-                                                                                          7266

----------------------- Page 13-----------------------

                             the   harmful   force   first   took   effect,   or   where   the   plaintiff  

                             suffered injury.                 [32]  

We concluded in Ebell that although the "harmful force" may have been initiated in the  


ThirdJudicial District,wheretheallegedly negligentadvicewas given, "theharmful force  


first took effect when the vessels were seized in the Second Judicial District"; it was  


therefore "appropriate to say that the Second Judicial District [was] a district in which the  


claim arose."33  


                             When a tort is complete is a question that also arises in the context of  


statutes of limitations.  "[T]he statute of limitation[s] as to torts does not usually begin to  


run until the tort is complete," which ordinarily does not occur "until there has been an  


invasion of a legally protected interest of the plaintiff."34                                                                    In Jones v. Westbrook  we  


considered  a  claim  that  a  lawyer,  retained  to  help  sell  a  business,  had  committed  


malpractice by failing to ensure that his client had a recorded security interest in the  


business's physical assets.35  Over seven years later the Internal Revenue Service filed tax  


liens against the assets, displacing the client's unsecured interest; we held it was only then  


              32            Id.  

              33            Id.  at 958.            See generally Green v. N. Arundel Hosp. Ass'n                                                       , 730 A.2d 221,         

229 n.8 (Md. Spec. App. 1999) (stating that "[o]ur research has revealed that the majority                                                                              

of our sister states with venue statutes similar to ours have held that a tort cause of action                                                                               

arises at the place of injury" and citing                                           Ebell  and other cases).           

              34            Jones v. Westbrook, 379 P.3d 963, 968 (Alaska 2016) (quoting Austin v.  


Fulton Ins. Co., 444 P.2d 536, 539 (Alaska 1968)).  


              35            Id. at 964-65.  


                                                                                         -13-                                                                                 7266

----------------------- Page 14-----------------------

that the malpractice claim was completed by the occurrence of "an appreciable injury" to                                                                   

the client.       36  

                        In Austin v Fulton Insurance Co. , an insured alleged that his insurer had  


                                                                                                              37   The alleged negligence  

negligently failed to provide requested earthquake coverage.                                                                              


occurred in 1961, but the insured was not aware of it until after the 1964 earthquake,  


when he suffered an uncovered loss.38   We concluded that the statute of limitations began  


to run in 1964, reasoning that the insured's interests were not invaded until he needed the  


coverage and discovered that he lacked it.39                                       We held that "there must be an injury or  


harm to [the insured] as a consequence of [the insurer's] negligence to serve as a basis for  


recovery of damages before the tort became actionable and before the period of limitation  


commenced to run."40  We supported this conclusion by reference to the First Restatement  


of Torts, which states: "A cause of action for misrepresentation in a business transaction  


is complete when the injured person has been deprived of his property or otherwise has  


suffered pecuniary loss or has incurred liability as a result of a misrepresentation."41  


                        In light of these authorities, we conclude that Shearer failed to make a prima  


facie case that his misrepresentation claims arose in the Second Judicial District.  The  


record,  viewed  in  the  light  most  favorable  to  Shearer,  shows  that  the  alleged  


misrepresentations were made in the Second Judicial District, while his contract was  


            36          Id.  at 967-69.



                        444 P.2d at 537-38.

            38          Id. at 539.


            39          Id. at 539-40.  


            40          Id.  at 539.   

            41          Id.  (quoting R          ESTATEMENT  (FIRST)  OF  TORTS   899 cmt. c (A                                    M. L    AW  INST .  


                                                                           -14-                                                                    7266

----------------------- Page 15-----------------------

being          negotiated             near        Nuiqsut,            and        that       Shearer            justifiably            relied         on       the  

misrepresentations in the Second Judicial District when he ceased negotiating for a full-                                                                   

time job with BP.                   But the representation and reliance elements of a tort claim are not                                                      

                                                                                            42  in fact there was no tort until Shearer  

enough to "make the defendant liable for the tort":                                                                                                   

had suffered a pecuniary loss, and he suffered no loss as long as he continued in BRPC's  


employ.   The alleged misrepresentations - "the harmful force" - "took effect" on  


Shearer only when BRPC terminated his employment two and a half years later by  


telephone from Anchorage while he was at home in Canada.  Because Shearer suffered  


no injury in the Second Judicial District, his tort claims cannot have arisen there for venue  



                         Shearer  argues  that  he  first  felt  the  harmful  effect  of  the  alleged  


misrepresentations in the Second Judicial District immediately after they were made,  


when he "gave up his full-time consulting work for BP on the North Slope and ceased  


negotiating   the   terms   of   permanent   employment   with   BP,   probably   foregoing  


consideration of employment with BP forever." But Shearer had no tort claim at that time  


and no reason to sue BRPC.  He was not injured by accepting the job he preferred in  


reliance           on       BRPC's              alleged           misrepresentations;                      the       effect         of      the       alleged  


misrepresentations was not harmful until he was terminated, completing the tort.  


                         We have cautioned against blurring the reliance and loss elements of a  


misrepresentation claim. In Anchorage Chrysler Center, Inc. v. DaimlerChrysler Motors  


Corp. (AnchorageChrysler II), acar dealershipsuedamanufacturerformisrepresentation  


in the context of failed plans to expand the dealership's business.43                                                                  We considered  


             42          See Ebell v. Seapac Fisheries, Inc.                              , 692 P.2d 956, 957 (Alaska 1984).                    



                         221 P.3d 977, 980-82 (Alaska 2009).  

                                                                              -15-                                                                       7266  

----------------------- Page 16-----------------------


whether the dealership had established the loss element of the misrepresentation claim.                                                                


While noting the existence of minor and unquantifiable losses made in reliance on the  


alleged misrepresentation, we rejected the dealership's claim that a weakening of its  

                                                                                                                               45   We noted  



bargaining position was itself a harm that satisfied the elements of the tort. 

that "there is no precedent in Alaska for considering a change in bargaining position to  


constitute  in  itself  a  loss  in  a  fraud  action."46                             We  explained  that  absent  "unusual  


circumstances . . . [i]t would not be appropriate to generally broaden the fifth element of  


the fraudulent misrepresentation tort by treating changed bargaining position as, in and  


of itself, an actual loss."47                 We reasoned:  


                       In virtually any fraudulent misrepresentation case involving  


                       negotiations or a contract, the reliance element will involve  


                       theuse of misrepresentation to influence what apartyconsents  


                       to do or not do.  Equating a compromised bargaining position  


                       with  actual  loss  would  thus  cause  the  loss  and  reliance  


                       elements of the tort to collapse into a single element.  Every  


                       time  a  party  could  show  that  it  acted  in  reliance  on  a  


                       fraudulent misrepresentation (the fourth element of the tort),  


                       it could automatically assert the misrepresentation harmed its  


                       bargaining power and caused a loss (the fifth element).[48]  


Rejecting the dealership's argument that reliance itself equaled loss, we concluded that  


"[t]he loss in fraudulent misrepresentation must be a pecuniary loss that is caused by the  


           44          Id.  at 987-92.   

           45          Id. at 991.  


           46          Id.  

           47          Id.  

           48          Id.  

                                                                       -16-                                                                7266

----------------------- Page 17-----------------------


plaintiff's reliance on the misrepresentation."                                                                                                                        Under this reasoning, we cannot accept                                                                                 

 Shearer's argument - adopted by the superior court - that the "harmful force" of                                                                                                                                                                                                                           

BRPC's   alleged   tort   took   effect   in   Nuiqsut,   when   Shearer   relied   on   the   alleged  

misrepresentations to his later detriment.                                                                                                          

                                               It was therefore error                                                             for  the superior court to conclude that Shearer's                                                                                              

misrepresentation claims arose in the Second Judicial District.                                                                                                                                                               

                        C.	                    The Second Judicial District Is Not A Proper Venue For Shearer's                                                                                                                                                                 

                                                Contract Claims Because The Claims Did Not Arise There.                                                                                                                                              

                                                1.	                    A breach of contract claim arises where a substantial part of the                                                                                                                                                                                 

                                                                       events giving rise to the claim occurred.                                                                        

                                               The contract-based claims asserted in Shearer's complaint included breach                                                                                                                                                                     

of contract, reformation, promissory estoppel, and breach of the covenant of good faith                                                                                                                                                                                                              

and fair dealing.                                          In  Ebell  we concluded that the term "claim arose" as used in the venue                                                                                                                                                             

statute had "a generally understood meaning" in tort law at the time the                                                                                                                                                                                                      legislature  

adopted it and therefore "                                                            as applied to tort suits                                                          was meant to include the place of injury                                                                               

                    50       But in Ebell we did not address where a contract claim arose, nor have we done  


so since.  We now decide that a breach of contract claim arises where a substantial part  


of the events giving rise to the claim occurred.  


                                                                       a.	                     Other  jurisdictions  take  a  variety  of  approaches  to  


                                                                                               determining where a "claim arose" for venue purposes.  


                                               As we recognized in Ebell, the federal venue statute in effect at the time had  


language similar to Alaska's:  it allowed venue in "the judicial district . . . in which the  


                        49                     Id.  (emphasis added).   

                        50                     Ebell   v.   Seapac   Fisheries,   Inc.,  692   P.2d   956,   957-58   (Alaska   1984)  

(emphasis added).   

                                                                                                                                                    -17-	                                                                                                                                        7266

----------------------- Page 18-----------------------


claim arose."                                But federal interpretations of this language were never uniform. In                                                                                                                               Leroy  

v.   Great Western United Corp.                                                                , construing the same phrase in 28 U.S.C.  1391(b)                                                                                      

(1976),  the United States Supreme Court declined to decide "whether this language                                                                                                                                                   

adopts the occasionally fictive assumption that a claim may arise in only one district"; it                                                                                                                                                                  

considered it "absolutely clear," however, "that Congress did not intend to . . . give                                                                                                                                                      

                                                                                                                                                                                                                     52         Giving  the  

 [plaintiffs]   an   unfettered   choice   among   a   host   of   different   districts."                                                                                                                                                            

language "the broadest interpretation . . . that is even arguably acceptable," the Court held  




                                       in the unusual case in which it is not clear that the claim arose  


                                       in only one specific district, a plaintiff may choose between  


                                       those  two  (or  conceivably  even  more)  districts  that  with  


                                       approximately equal plausibility -in terms of the availability  


                                       of witnesses, the accessibility of other relevant evidence, and  


                                       the convenience of the defendant (but not of the plaintiff) -  


                                       may be assigned as the locus of the claim.[53]  


                    51                 Id.  at 957 (quoting 28 U.S.C.  1391(a)-(b) (1982) (amended 1990)).                                                                                                                                       The  

federal statute was amended in 1990 to recognize that claims could arise in more than                                                                                                                                                             

one district; the current language thus authorizes venue in any "judicial district in which                                                                                                                                                  

a substantial part of the events or omissions giving rise to the claimoccurred." 28                                                                                                                                                       U.S.C.  

  1391(b)(2) (2012); see Jenkins Brick Co. v. Bremer                                                                                                          , 321 F.3d 1366, 1371 (11th Cir.   

2003) (explaining congressional rationale for 1990 amendment).                                                                                          

                    52                 443 U.S. 173, 184-85 (1979).  


                    53                 Id. at 185 (emphasis in original) (footnote omitted).  


                                                                                                                           -18-                                                                                                                 7266

----------------------- Page 19-----------------------


                                       Finding this exegesis unhelpful,                                                               federal courts continued to apply an array                                                              

of approaches for determining where a "claim arose."                                                                                                          Some courts applied "a test that                                                   

considers the 'weight of the contacts' between the claim and the various districts in which                                                                                                                                                

                                                                                  55       Under this test, "venue would be proper in the district  

venue may be appropriate."                                                                                                                                                                                                             

having the most significant ties to the claim."56                                                                                                   A second test was the "substantial  


contacts" test (sometimes called "the American Law Institute rule"), under which "venue  


is proper in any district in which a substantial part of the events or omissions giving rise  


to the claim occurred."57  Under this test - now reflected in the federal venue statute58  


                    54                 See Broad. Co. of the Carolinas v. Flair Broad. Corp.                                                                                                     , 892 F.2d 372, 375                           

 (4th Cir. 1989) ("Unfortunately, this language has spawned as much uncertainty as the                                                                                                                                                           

wording of the 'claims arose' clauses . . . themselves."),                                                                                                        superseded by statute                                          , Federal   

Courts Study Committee Implementation Act of 1990, Pub. L. No. 101-650,  311, 104                                                                                                                                                             

 Stat. 5114 (1990),                                   as recognized by Mitrano v. Hawes                                                                        , 377 F.3d 402 (4th Cir. 2004);                                        

Dody   v.   Brown,   659   F.   Supp.   541,   546   (W.D.   Mo.   1987)  (observing   that   "great  

confusion" over meaning of "claim arose" "has been further heightened by the United                     

 States Supreme Court's pronouncement in                                                                                   Leroy");  Cheeseman v. Carey                                                           , 485 F. Supp.         

203, 213 (S.D.N.Y. 1980) ("The difficulties posed by                                                                                                    Leroy  seem certain to make venue                                               

issues an even greater problem for the lower federal courts than they were before the                                                                                                                                                           

 Supreme Court spoke.").                      

                    55                Broad. Co. of the Carolinas, 892 F.2d at 375.  


                    56                Id. at 376; see also DeLong Equip. Co. v. Wash. Mills Abrasive Co., 840  


F.2d 843, 855 (11th Cir. 1988).  


                    57                Broad. Co. of the Carolinas, 892 F.2d at 376;  Cochrane v. Iowa Beef  


Processors, Inc., 596 F.2d 254, 260-61 (8th Cir. 1979) (explaining that the American  


Law Institute rule was "derived from the ALI Study of the Division of Jurisdiction  


Between the State and Federal Courts,  1303, 1314 (1969)"); AM. L                                                                                                                                     AW  INST ., S                    TUDY  


                       DIVISION OF JURISDICTION  BETWEEN  STATE AND FEDERAL  COURTS,  1303,                                                                                                                                            

OF THE                                                                                                                                                                                              

 1314 (1969).   

                    58                 See  28  U.S.C.    1391(b)(2)  (2012); Magic  Toyota,  Inc.  v.  Se.  Toyota  



                                                                                                                        -19-                                                                                                               7266

----------------------- Page 20-----------------------

-   if   venue   could  be   situated   in   either   of   two   districts   with   "approximately   equal  

plausibility," the court did not weigh the two against each other:                                        either district was a   

                      59  A third test relied on "the place of intended performance,"60 which we  

proper venue.                                 


discuss further below.  State courts with "claim arose" language in their venue statutes  


have also followed a variety of approaches, finding proper venue where the contract was  



made, where it was breached, or where the damages occurred. 

                     In this case the superior court favored the "place of intended performance"  



rule adopted by the Ninth Circuit in Decker Coal Co. v. Commonwealth Edison Co.,  


           58        (...continued)  


Distribs., Inc., 784 F. Supp. 306, 317 (D.S.C. 1992) ("[T]he American Law Institute  


test . . . is almost identical to the newly implemented  1391(b)(2).").  

           59        Arandia v. Marriott Corp. , 668 F. Supp. 452, 453 (D. Md. 1987); see also  


Cumis Ins. Soc'y, Inc. v. South-Coast Bank, 587 F. Supp. 339, 346-48 (N.D. Ind. 1984).  


           60        Broad. Co. of the Carolinas, 892 F.2d at 376-77.  


           61        See, e.g., Precision Software, Inc. v. Gauthier, 605 So. 2d 592, 594 (Fla.  


Dist. App. 1992) ("A cause of action for breach of contract is said to have accrued in the  


county where the breach occurred . . . [and] [a] breach is said to have occurred where  


failure of performanceoccurred."); Corder v. Idaho Farmway, Inc., 986 P.2d 1019, 1024  


(Idaho App. 1999) ("[F]or the purposes of venue, a breach of contract action arises in the  


county  where the contract was made, where it was breached or where the damage  


occurred."); State ex rel. Thornhill Grp., Inc. v. King, 759 S.E.2d 795, 801 (W. Va. 2014)  


("[T]he place where the cause of action arises in a breach of contract claim for purposes  


of venue selection [is] based on the tripartite aspects of a contractual claim (formation,  


breach, and damages) . . . [T]he facts relevant to a particular breach of contract claim will  


govern which of those three potential venue selections are appropriate in a given case.").  


           62        805 F.2d 834 (9th Cir. 1986), superseded by statute Federal Courts Study  


Committee Implementation Act of 1990, Pub. L. No. 101-650,  311, 104 Stat. 5114  



                                                                  -20-                                                           7266

----------------------- Page 21-----------------------


which is the rule Shearer advocates on appeal.                                           Decker Coal             involved a contract for the                

delivery   of   coal  from   Decker's   Montana   mine   to   electrical   utilities   in   Illinois   and  



Indiana.             The utility company argued "that the event giving rise to the claim was its  


transmittal  of  notice  [from  its  Illinois  offices]  invoking  the  force  majeure  clause[;]  



therefore, the claim arose in Illinois."                                    But the Ninth Circuit decided that venue was  


proper in the place of intended performance, Montana, "because the place of performance  


is determined at the inception of the contract and therefore parties can anticipate where  



they may be sued."                        It explained that this test was consistent with "[t]he overriding  


purpose of  1391(a)," which "is to further the convenience of the parties," and it noted  



that "the place of performance is likely to have a close nexus to the underlying events." 


                         The Ninth Circuit's rationale suited the facts in Decker Coal, in which the  


contract was actually performed where the parties intended it to be performed, and "the  


convenience of the parties" - at least of the plaintiff - was undoubtedly furthered by  


the plaintiff's choice of venue in its own home district.  But the rationale falters in a case  


like  this  one,  in  which  the  plaintiff  contends  that  the  contract  was  intended  to  be  

            63           The   superior   court   found   "that   the   place   of   intended   performance   for  

Shearer's employment contract was primarily in Anchorage" and "[t]herefore, venue                                                                   

may be proper in Anchorage" for Shearer's breach of contract claim.                                                              

            64          Decker Coal, 805 F.2d at 837.  


            65          Id. at 842.  


            66          Id.   Notably,  venue  for the  claim was proper  in Montana regardless  of  


where the "claim arose," since the plaintiff was a Montana resident and "the judicial  


district where all plaintiffs . . . reside" is one proper choice for venue under 28 U.S.C.  


  1391(a).  See  id. at  841-42.  The Ninth  Circuit concluded "that Montana venue is  


proper because Decker Coal is a resident of Montana and the claim arose there." Id. at  


841 (emphasis added).  


            67          Id. at 842.  


                                                                             -21-                                                                     7266

----------------------- Page 22-----------------------

performed someplace other than where it was actually performed. According to Shearer,                                                                                                                                                    

the   parties   intended   that   he   work   "primarily   .   .   .   on   the   North   Slope   when   drilling  

 commenced" and in Anchorage only "when there was no activity on the North Slope,"                                                                                                                                      

but drilling was delayed and he "ended up working primarily out of the Anchorage                                                                                                                                               

 office."   When the parties intend to perform their contract in one location but ultimately                                                                                                                                       

perform it somewhere else, basing venue on their unrealized intentions would seem                                                                                                                                                                

unlikely, as a rule, to "further the convenience of the parties" or "have a close nexus to                                                                                                     

the underlying events."                                              68  

                                        We note that given the facts of Decker Coal, the rule the Ninth Circuit  


 applied  was  really  a  "place  of  actual  performance"  rule,  not  a  "place  of  intended  


performance" rule, despite how it was stated and later characterized.69  If, for example,  


the  parties  had  intended  Decker  to  produce  coal  in  Montana  but  it  had  shifted  its  


 operations to Pennsylvania where all the work actually took place, the Ninth Circuit is  


unlikely to have relied on a "place of intended performance" rule made by reference to  


 "[t]he overriding purpose of" the venue statute - "further[ing] the convenience of the  


parties."70                      It was the place of actual performance that mattered.  In this case, if we look  


to the place of actual performance - a place convenient to the parties, where at least one  


 of them resides and where they can expect to find witnesses and employment records  


                    68                 Id.  

                    69                  See, e.g.               ,  Broad. Co. of the Carolinas v. Flair Broad. Corp.                                                                                               , 892 F.2d 372,                

 376    (4th    Cir.    1989),   superseded  by   statute,    Federal    Courts    Study    Committee  

 Implementation Act of 1990, Pub. L. No. 101-650,  311, 104 Stat. 5114 (1990),                                                                                                                                                                       as  

 recognized by Mitrano v. Hawes                                                                  , 377 F.3d 402 (4th Cir. 2004);                                                               Lee v. Corr. Corp. of                                    

Am. , 525 F. Supp. 2d 1238, 1242 n.3 (D. Haw. 2007);                                                                                                        Concesionaria DHM, S.A. v. Int'l                                                      

Fin. Corp.                      , 307 F. Supp. 2d 553, 560 (S.D.N.Y. 2004);                                                                                          PKWare, Inc. v. Meade                                                 , 79 F.      

 Supp. 2d 1007, 1016 (E.D. Wis. 2000).                                                                                

                    70                 Decker Coal, 805 F.2d at 842.  


                                                                                                                           -22-                                                                                                                 7266

----------------------- Page 23-----------------------

relevant to the plaintiff's claims - proper venue is the Third Judicial District, not the                                                                                 


                                        b.	           The purposes of the venue rule are best served by a test                                                          

                                                      that   takes   account   of   where   "a   substantial   part   of   the  

                                                      events" underlying the claim occurred.                         

                           In   Ebell   we noted                   the development of the predominant "weight of the                                                     


contacts" approach in federal case law, including its recent "utiliz[ation] in tort suits."                                                                                       


But while applying the "place of injury" rule to tort suits, we did "not reject the 'weight  

of the contacts' approach in all respects."72                                                                                            

                                                                                         We cautioned, though, that a test requiring  


the weighing of contacts in different forums "seems to produce much litigation," and that  


parties could more productively focus their "attention on the statutory guidelines for  


changing venue" rather "than attempting the often imponderable task of enumerating and  


quantifying contacts in an effort to fulfill the 'occasionally fictive' quest for the one  



district in which the claim arose."                                      Ultimately, we "disapprove[d] of the weight of the  


contacts approach," but "only insofar as it assumes that there is but one district in which  



a claim may arise." 


                           Given our caveat in Ebell - that a "weight of the contacts approach" should  


accommodate the possibility of a claim arising in more than one district - we conclude  


that the American Law Institute (ALI) test, which allows venue in any district in which  

             71            Ebell  v.  Seapac  Fisheries,  Inc.,  692  P.2d  956,  958  (Alaska   1984).  

             72            Id.   

             73            Id.  at  958-59  (footnote  omitted)  (quoting  Leroy  v.  Great  W.  United  Corp.,  

443  U.S.  173,  184-85  (1979)).   Those  statutory  guidelines  include  "when  there  is  reason  

to  believe  that  an  impartial  trial  cannot  be  had"  and  "when  the  convenience  of  witnesses  

and  the  ends  of  justice  would  be  promoted  by  the  change."   AS  22.10.040(1)-(2); see  


   lso Ebell, 692 P.2d at 959 n.12 (quoting full text of statute).  

             74            Ebell, 692 P.2d at 959.  


                                                                                    -23-	                                                                           7266

----------------------- Page 24-----------------------


"a substantial part of the events or omissions giving rise to the claim occurred,"                                                                                   best  

serves the purposes of Alaska's venue doctrine.  The ALI test's "major purpose" is "to   

liberalize the weight of the contacts test by [e]nsuring that venue would be proper in more                                                                         

                                    76  thus directly addressing our concern in Ebell.  

than one district,"                                                                                                    

                           The ALI test is the basis for the current version of the federal venue statute,  


which in 1990 replaced the phrase "the judicial district . . . in which the claim arose"77  


with the more inclusive phrase "a judicial district in which a substantial part of the events  


or omissions giving rise to the claim occurred."78                                                       Federal courts have observed that  


Congress intended the new language to eliminate  the "wasteful litigation"79   and the  


"plethora of tests"80   which up to then  had been used to determine which of several  


             75            AM.L        AW  INST .,S           TUDY OF THE              DIVISIONOF               JURISDICTION  BETWEEN  STATE  

          FEDERAL COURTS,  1303, 1314 (1969).                                


             76           Dody  v.  Brown,  659  F.  Supp.  541,  547  (W.D.  Mo.   1987).   

             77            28  U.S.C.     1391(a)-(b)  (1988)  (emphasis  added)  (amended   1990).  

             78            28  U.S.C.    1391(a)(2)  (Supp.  II  1991)  (emphasis  added)  (amended  2011);  

see  Cottman  Transmission  Sys.,  Inc.  v.  Martino,  36  F.3d  291,  294  (3d  Cir.   1994)  ("The  



    ouse Report noted that the new language was in accord with that recommended earlier  

by an American Law Institute study." (citing H.R. R                                                      EP. N      O. 101-734, at 23 (1990),                          as  

reprinted in              1990 U.S.C.C.A.N. 6860, 6869)).                     

             79            Uffner v. La Reunion Francaise, S.A., 244 F.3d 38, 42 (1st Cir. 2001)  


("Congress amended the statute to its current form because it found that the old language  


 'led  to  wasteful  litigation  whenever  several  different  forums  were  involved  in  the  


transaction leading up to the dispute.' " (quoting Cottman, 36 F.3d at 294)); see also  


Jenkins Brick Co. v. Bremer, 321 F.3d 1366, 1371 (11th Cir. 2003) ("Congress believed  


that the old phrase was 'litigation-breeding,' partly because it did not cover the situation  


 'in which substantial parts of the underlying events have occurred in several districts.' "  


(quoting H.R. REP. N                       O. 101-734, at 23)).          


             80            Uffner, 244 F.3d at 42 ("The pre-amendment statute . . . engendered a                                                                          


                                                                                   -24-                                                                           7266

----------------------- Page 25-----------------------

possible districts was the single one in which "the claim arose"; the amendment makes             

clear "that when the events underlying a claim have taken place in different places, venue                                                                                   


may be proper in any number of districts."                                                      


                            But federal courts have also observed that the amended statutory language  


did not change "the purpose of statutorily specified venue," which is still "to protect the  


defendant against the risk that a plaintiff will select an unfair or inconvenient place of  

            82    The "substantial part" language "is intended to preserve the element of fairness  


so that a defendant is not haled into a remote district having no real relationship to the  


dispute."83  Thus, "[e]vents or omissions that might only have some tangential connection  


with  the  dispute in  litigation  are  not  enough."84                                                       "[S]ignificant  events  or  omissions  


material to the plaintiff's claim must have occurred in the district in question, even if  


                                                                                          85  "And of the places where the events have  

other material events occurred elsewhere."                                                                                                


taken place, only those locations hosting a 'substantial part' of the events are to be  


              80            (...continued)  


plethora of tests to determine the single venue in which the claim 'arose.' ").  

              81            Id. ;  see also Gulf Ins. Co. v. Glasbrenner                                         , 417 F.3d 353, 356 (2d Cir. 2005)                        

("The new language contemplates that venue can  be appropriate in  more than  one  


district.");  Jenkins Brick                        , 321 F.3d at 1371 ("The new language thus contemplates some                                                             

cases in which venue will be proper in two or more districts.").                                               

              82             Cottman, 36 F.3d at 294 (emphasis in original) (quoting Leroy v. Great W.  


 United Corp., 443 U.S. 173, 183-84 (1979)).  


              83            Id.  

              84            Id. ; see also Jenkins Brick, 321 F.3d at 1371 ("Only the events that directly  


give rise to a claim are relevant.  And of the places where the events have taken place,  


only those locations hosting a 'substantial part' of the events are to be considered.").  


              85             Gulf Ins., 417 F.3d at 357 (emphasis in original).  


                                                                                        -25-                                                                                7266

----------------------- Page 26-----------------------


considered."                   The test is thus not to be confused with the "minimum contacts" test used                                                                   

for determining personal jurisdiction; "contacts" matter only to the extent they are the                                                                                     

                                                                                             87   The evolving federal standard, based on  

"events or omissions giving rise to the claim."                                                                                                                                

the ALI test, thus remains consistent with the operative phrase of our own venue rule,  


which turns on where the "claim arose" rather than where the parties have the most  



                            2.	          A substantial part of the events giving rise to Shearer's breach  


                                         of contract claim did not occur in the Second Judicial District.  


                            In  his  affidavit opposing  BRPC's venue motion,  Shearer  identified  the  


contacts between his suit and the Second Judicial District. First, he alleged that it was on  


the North Slope that BRPC offered, and he accepted, a ten-year term of employment.  


Second, he alleged that the parties' expectation when he was hired was that he would  


"work in BRPC's Anchorage office during periods when there was no activity on the  


North  Slope"  but  "would  be  primarily  needed  on  the  North  Slope  when  drilling  


commenced."  Third, he alleged that "there [was] current activity at BRPC's Mustang  


Pad" on the North Slope and that he believed "BRPC is in the process of designing a  


production facility that will be situated near Nuiqsut."  


              86	          Jenkins Brick               , 321 F.3d at 1371.         

              87           See Gulf Ins.               , 417 F.3d at 356-57 (quoting 28 U.S.C.  1391(b) (2000)                                                     


(amended 2011)) ("It would be error . . . to treat the venue statute's 'substantial part' test  

as mirroring the minimum contacts test employed in personal jurisdiction inquiries.");  


Cottman,  36  F.3d  at  294  ("The  test  for  determining  venue  is  not  the  defendant's  


 'contacts' with a particular district, but rather the location of those 'events or omissions  


giving rise to the claim.' ").  

              88           Alaska R. Civ. P. 3(c)(1).  


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                                A breach of contract claim depends on proof of the existence of a contract,                                                                                  


breach, and damages.                                                                                                                                                                                            

                                                           "[E]ntry into an agreement does not automatically qualify as a  




substantial part of the events or omissions giving rise to a breach of contract claim." 


Where   a   contract   was   negotiated,   while   sometimes   important,   may   fade   into  

                                                                                                                                                                                                  91     The  


insignificance if the contract is largely performed and breached somewhere else. 

"place of intended performance" rule which Decker Coal found to be consistent with the  


purpose of the venue doctrine - "to further the convenience of the parties"92  - is thus  


                89               Great W.              Sav. Bankv. GeorgeW.                                   EasleyCo.                 , 778 P.2d 569, 577-78 (Alaska                         

 1989) (holding that complaint alleging that defendant "had a contractual obligation to                                                                                                                     

make direct payments to" plaintiff, defendant "breached this contract," and plaintiff                                                                                                        

"suffereddamages"was sufficient                                                   for purposes ofpleading                                   breach ofcontract                          claim);  see  

Nicdao v. Chase Home Fin.                                         , 839 F. Supp. 2d 1051, 1068 (D. Alaska 2012) ("In order to                                                                               

assert a claim for breach of contract, a plaintiff must generally allege:                                                                                                (1) existence of  

a contract; (2) breach; (3) causation; and (4) damages.").                                                                                 

                90              Abramoff v. Shake Consulting, L.L.C. , 288 F. Supp. 2d 1, 5 (D.D.C. 2003)  


(concluding that although "the finalized agreement was a prerequisite to the defendants'  


alleged breach, . . . the act of finalizing the agreement was not itself wrongful and did not  


directly give rise to the plaintiff's claim").  


                91              See PI, Inc. v. Quality Prods., Inc., 907 F. Supp. 752, 757-58 (S.D.N.Y.  


 1995)  (rejecting  argument  that  oral  agreement  reached  at  New  York  toy  fair  was  


substantial part of events giving rise to breach of contract claim where initial discussions  


occurred in Arkansas, contract was finalized and executed after parties returned to their  


respective domiciles in Florida and Massachusetts, contract was not to be performed in  


New York, and alleged breach was of one party's obligation to prepare SEC documents  


in Florida and file them in Washington, D.C.).  


                92              Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 842 (9th Cir.  


 1986), superseded by statute Federal Courts Study Committee Implementation Act of  


 1990, Pub. L. No. 101-650,  311, 104 Stat. 5114 (1990).  


                                                                                                     -27-                                                                                           7266

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still given primary, and often dispositive, weight by federal courts in the Ninth Circuit.                                                                                        



Where the contract was breached is usually an important factor.                                                                    And where the damage  



occurs may also be significant. 


                           The only one of the contacts Shearer identifies that is directly relevant to his  


breach of contract claims is the first - that the Second Judicial District was where  


employment was first discussed and offered.   But in this case the site of the parties'  


alleged oral agreement appears to have had little to do with the alleged breach. Shearer's  


contract claims, based on the alleged oral promise of a ten-year term of employment,  


would be exactly the same if the discussions had occurred in Anchorage, Honolulu, or  


London.  The intended place of performance was apparently not material to the parties'  


agreement; the alleged breach occurred after Shearer had spent three and a half years  

                                                                                                                                                    96  in either the  



working primarily in Anchorage.  There is no "close nexus to the wrong" 

              93           See, e.g.        ,  Denari v. U.S. Dry Cleaning Servs. Corp.                                              , No. 1:17-CV-0031     

AWI BAM, 2017 WL 2779051, at *5 (E.D. Cal. June 27, 2017);                                                                          Sussman Shank, LLP                 

v.  Citizens of Humanity, LLC                             , No. 3:15-CV-02148-HZ, 2016 WL 9343891, at *8 (D. Or.                                                         

April 18, 2016);  Ahead, LLC v. KASC, Inc.                                              , No. C13-0187JLR, 2013 WL 1747765, at     

*7 (W.D. Wash. Apr. 23, 2013).                                      

              94           See Jenkins Brick Co. v. Bremer, 321 F.3d 1366, 1372 (11th Cir. 2003)  


("[M]ost importantly, the contract was breached when Bremer failed to performhis post- 


employment obligation to refrain from competing against Jenkins Brick - conduct that  


occurred only in Georgia."); Elemary v. Philipp Holzmann A.G., 533 F. Supp. 2d 144,  


 150  (D.D.C. 2008)  ("[T]he site of the alleged  breach  weighs heavily  in  the venue  


analysis." (citing Abramoff , 288 F. Supp. 2d at 2-5).  But cf. Decker Coal, 805 F.2d at  


842 (finding that venue in "the place of intended performance" rather than "the place of  


repudiation" better served "the spirit of  1391(a)").  


              95           See Kirkpatrick v. Rays Grp., 71 F. Supp. 2d 204, 212 (W.D.N.Y. 1999)  


("The place where the alleged harm occurred is also relevant for purposes of venue.").  


              96           Jenkins Brick, 321F.3d at 1372 (interpreting 28U.S.C. 1391(a)(2) (1994)  



                                                                                    -28-                                                                             7266

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parties' expectation that Shearer would perform some of his work on the North Slope or                                                                                                                                                                                                              

BRPC's alleged activities there.                                                                                

                                              The agreement discussed on the North Slope was reduced to writing and                                                                                                                                                                           

signed when the parties were in Anchorage.                                                                                                                      The contract was largely performed in                                                                                              

Anchorage,   and   for   the   duration   of   the   parties'   contractual  relationship   no   events  

significant to Shearer's claims occurred in the Second Judicial District.  Nothing about   

the breach itself - not the first oral notice to Shearer that he was to be terminated, the                                                                                                                                                                                                      

follow-up   telephone   call,   the   letter   confirming   his   termination,   his  receipt   of   these  

messages, or any resulting harm - is alleged to have occurred in the Second Judicial                                                                                                                                                                                            


                                              Finally, it is noteworthy that Shearer does not dispute BRPC's contention   

that there are no witnesses or relevant documents on the North Slope.                                                                                                                                                                                    In light of the                        

purpose of the venue doctrine - which is still to protect a defendant against an unfair                                                                                                                                                                                               

                                                                                                                                                                                               97 - we conclude that the North  

choice of venue with "no real relationship to the dispute"                                                                                                                                                                                                                             

 Slope was not a place where "a substantial part of the events or omissions giving rise to  


the claim occurred."98  


                       96                     (...continued)

as  "consider[ing]  as  relevant  only  those  acts  and  omissions  that  have  a  close  nexus  to  the


                       97                     Cottman Transmission Sys., Inc.  v. Martino, 36 F.3d 291, 294  (3d Cir.  



                       98                     See AM.  LAW  INST .,   STUDY  OF  THE  DIVISION  OF  JURISDICTION BETWEEN  


 STATE AND  FEDERAL  COURTS,     1303,   1314  (1969).

                                                                                                                                               -29-                                                                                                                                    7266

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                          D.                         We Do Not Need To Address The Remaining Issues On Which We                                                                                                                                                                                                                          

                                                     Granted Review.   

                                                     Given our conclusion that Shearer's tort and contract claims did not arise in                                                                                                                                                                                                               

the Second Judicial District and that venue was not proper there for either type of claim,                                                                                                                                                                                                                                      

we do not need to decide the remaining issues on which we granted review.                                                                                                                                                                                                    

V.                         CONCLUSION  

                                                     We REVERSE the superior court's order and REMAND with instructions  


to transfer the case to the Third Judicial District.  


                                                                                                                                                                     -30-                                                                                                                                                         7266

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