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The Red Barn Shop, LLC v. Plainfield Renewable Energy, LLC

United States District Court, D. Kansas

March 25, 2019




         Plaintiff The Red Barn Shop, LLC brought this action in the Brown County District Court against defendant Plainfield Renewable Energy, LLC for breach of contract and quantum meruit. Defendant removed the action to federal court based on diversity of citizenship, and subsequently filed Defendant PRE Renewable Energy, LLC's Motion to Dismiss, or Alternatively, to Transfer Venue (Doc. 5). Defendant claims that this court lacks personal jurisdiction and is an improper venue to bring this claim. According to defendant, nearly all of the relevant actions for this case occurred in Connecticut-not Kansas. Moreover, defendant claims, the parties contracted to resolve all disputes arising out of the contract in Connecticut. For the reasons explained below, the court grants defendant's motion to transfer.

         I. Background

         This case arises from an alleged breach of contract regarding a project to construct, fabricate, and install high rolling windscreen doors, fixed windscreen enclosures, as well as other climate and dust control improvements at defendant's power plant in Plainfield, Connecticut. According to defendant, this power plant “provides renewable energy throughout New England” and the project “was intended to bring the Power Plant into compliance with Connecticut energy and environmental rules and regulations.” (Doc. 5, at 2.) The agreement was entered and performed in 2018. After the project was completed, plaintiff issued a final invoice for labor and materials provided under the agreement, but defendant has not paid $410, 354.84 on the final invoice for plaintiff's work under the agreement.

         II. Legal Standards

         “[W]hen the court's jurisdiction is contested, the plaintiff has the burden of proving jurisdiction exists.” Wenz v. Memory Crystal, 55 F.3d 1503, 1505 (10th Cir. 1995) (citations omitted). “Where . . . there has been no evidentiary hearing, and the motion to dismiss for lack of jurisdiction is decided on the basis of affidavits and other written material, the plaintiff need only make a prima facie showing that jurisdiction exists.” Id.

         Because a forum-selection clause is involved here, the rules are slightly different: (1) “[T]he plaintiff's choice of forum merits no weight” and “the plaintiff bears the burden of establishing that transfer to the forum for which the parties bargained is unwarranted”; and (2) The parties' private interests are irrelevant. Atl. Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Tex., 571 U.S. 49, 63-4 (2013).

         III. Analysis

         a. Terms of the Forum Selection Clause

         Defendant argues the agreement between the parties contains a forum selection clause that requires this claim be brought in Connecticut. Forum selection clauses are presumptively valid. M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972); Bowen Eng'g, Corp. v. Pac. Indem. Co., 83 F.Supp.3d 1185, 1191 (D. Kan. Jan. 6, 2015). Supreme Court precedent requires a “strong showing” that a forum selection clause should be set aside. See M/S Bremen, 407 U.S. at 15 (“Thus, in the light of present-day commercial realities and expanding international trade we conclude that the forum clause should control absent a strong showing that it should be set aside.”); see also Herr Indus., Inc. v. CTI Sys., SA, 112 F.Supp.3d 1174, 1178 (D. Kan. 2015) (“The Supreme Court has made clear that a court should respect and enforce a valid forum selection clause agreed by contracting parties.”). Forum selection clauses are “prima facie valid and should be enforced unless enforcement is shown by the resisting party to be unreasonable under the circumstances.” Milk “N” More, Inc. v. Beavert, 963 F.2d 1342, 1346 (10th Cir. 1992).

         Forum selection clauses may be labeled as permissive or mandatory. See K & V Sci. Co., v. Bayerische Motoren Werke Aktiengesellschaft (“BMW”), 314 F.3d 494, 498 (10th Cir. 2002) (citing Excell, Inc. v. Sterling Boiler & Mech., Inc., 106 F.3d 318, 320 (10th Cir. 1997)). The language of the provision determines whether the clause is permissive or mandatory. See Id. (“Mandatory forum selection clauses contain clear language showing that jurisdiction is appropriate only in the designated forum.”). Where venue is specified with mandatory or obligatory language, the clause will be enforced. Id. at 499. Language creating a mandatory forum selection clause must be exclusive, such as “only, ” “sole, ” or “exclusive.” See Kirk v. NCI Leasing, No. 6:05-cv-01199-MLB-DWB, 2005 WL 3115859 (D. Kan. Nov. 21, 2005); Knight Oil Tools, Inc. v. Unit Petroleum Co., No. CIV 05-0669 JB/ACT, 2005 WL 2313715 (D. N.M. Aug. 31, 2005) (finding multiple cases where use of the word “shall” was not itself sufficient to deem the clause mandatory); K&V Sci. Co., 314 F.3d at 498-500.

         The forum selection provision in the agreement between plaintiff and defendant states:

GOVERNING LAW, JURISDICTION AND BUYER'S RIGHTS: Seller and Buyer agree that this Purchase Order is made and executed in the state where the work is performed and shall be interpreted under the laws of that state. Buyer and Seller hereby submit to the jurisdiction of the courts of such state, expressly waiving the jurisdiction of any other court. The prevailing Party in any claim before the court shall be entitled to have the costs of the court and attorney fees paid by the other Party.

(Doc. 6-1, at 108 (emphasis added).) The jurisdictional language is exclusive, referring only to one state. The provision includes an express waiver of all other jurisdictions except the state these parties consented to. It prohibits litigation in jurisdictions other than that specified by the parties-a significant indication that this provision is mandatory. See K&V Sc. Co., 314 F.3d at 498 (“In contrast, permissive forum selection clauses authorize jurisdiction in a designated forum, but do not prohibit litigation elsewhere.”). The language of the express waiver establishes that jurisdiction is appropriate only in the designated forum. Because the forum selection provision is mandatory, ...

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