Scepter, Inc. v. Nolan Transp. Grp., LLC
Scepter, Inc. v. Nolan Transp. Grp., LLC
Opinion of the Court
After removing this case from the Davidson County Chancery Court, Nolan Transportation Group, LLC ("NTG") filed a Motion to Dismiss Under F. R. Civ. P. 12(b)(6) or Alternatively to Transfer Venue Under
I. Factual Background
According to the Complaint and its attachments
*829After repeated solicitations from NTG, Scepter completed a "Customer Profile Form." A cover sheet titled "Contract Provisions" was attached to the form, and immediately below the signature line on the form was the notation that "[t]he contract provisions on page one (1) are incorporated by reference and constitute a part of the agreement. Reference should be made to the terms of this agreement as stated on page one (1) and NTG's extended terms and conditions located at www.ntglfreight.com/services." (Doc. No. 1-2 at 7). Among other things, the attached Contract Provisions stated:
Nolan Transportation Group, LLC ("NTG") is a non-asset based Broker and will be referenced as a Broker when any determination of relationship is needed between NTG and Customer. I hereby apply to Nolan Transportation Group, LLC ("NTG") for credit and this form is my authorization to contact our credit references and banking institutions now, and at any future date, for full disclosure of current credit status and release of credit history. This form is not an agreement to extend credit, and that NTG, at its discretion, may extend or withdraw credit at any time. I will promptly notify NTG of any subsequent changes which would affect the accuracy of any information provided. I agree to pay all invoices within 30 days of the invoice date. Further, I agree to pay a service charge of 1 ½% per month on any and all past due balances. I shall be responsible for 15% attorney fees on the principal and accrued interest combined in the collection of the undersigned's account. By signing this form, I hereby submit to the jurisdiction and venue of the state courts located in Fulton County, Georgia, or a venue to be decided at the sole discretion of Nolan Transportation Group, with respect to any and all matters arising from this agreement. I do hereby waive all objections to venue and jurisdiction, including forum non conveniens. By doing business with NTG you are subject to NTG's continued terms and conditions located at www.ntgfreight.com/services.
(Id. at 6) (emphasis added). Nathan Tooley, the Chief Financial Officer of Specter, signed the Customer Profile Form and it was submitted to NTG on June 7, 2018.
The next day, Scepter asked NTG to pick up 44,487 pounds of aluminum ingot from its facility in Waverly, Tennessee, and deliver it to Scepter's customer in Shelbyville, Indiana. The customer agreed to pay $40,532.55 for the ingot.
NTG informed Scepter that a driver would pick-up the ingot on June 14, 2018 at 1:30 p.m. When the driver did not show as scheduled, both Scepter and NTG called his cell-phone number. The driver stated that he was nearing Scepter's facility.
A tractor, with the words "18 Wheeler" emblazoned on the sleeper, finally arrived at 4:30 p.m. The driver provided Scepter with the appropriate passcode, and then left with the ingot. The driver, tractor trailer, and ingot then vanished, never to be seen by the parties again.
*830On June 18, 2018, NTG informed Scepter that it had lost the tracking signal from the tractor trailer and that the cargo was presumed stolen. NTG also told Scepter that it did not believe the driver was actually employed by 18 Wheeler Transport. Specter then filed a police report. It also contacted 18 Wheeler Transport in Tucson, Arizona, but was informed that 18 Wheeler Transport did not transport goods that far east.
As a result of these events, Scepter filed suit in the Chancery Court alleging breach of contract, negligence, and violation of the Tennessee Consumer Protections Act. It seeks to recover damages (including the $40,532.55 that the Shelbyville customer promised Specter), plus prejudgment interest, attorney's fees, and costs.
II. Application of Law
Where a case is improperly filed in contravention of a forum selection clause, the Court has the discretion to either dismiss the action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, or to transfer the case in accordance with Rule 1404(a). Smith v. Aegon Cos. Pension Plan,
NTG quotes May v. Ticketmaster Entm't, LLC, No. 3:10-cv-00760,
A forum selection clause (sometimes abbreviated as an FSC) can be either mandatory or permissive. As the Fifth Circuit has explained:
A mandatory FSC affirmatively requires that litigation arising from the contract be carried out in a given forum. By contrast, a permissive FSC is only a contractual waiver of personal-jurisdiction and venue objections if litigation is commenced in the specified forum. Only mandatory clauses justify transfer or dismissal. An FSC is mandatory only if it contains clear language specifying that litigation must occur in the specified forum-and language merely indicating that the courts of a particular place "shall have jurisdiction" (or similar) is insufficient to make an FSC mandatory.
Weber v. PACT XPP Techs., AG,
Assuming that the Contract Provisions contain what can be properly characterized as a forum selection clause, the clause is permissive, not mandatory. It states that (1) the parties submit to the jurisdiction and venue of the Fulton County, Georgia courts, and (2) Specter waives all objections to that jurisdiction and that venue. This is far different than stating that Specter must file suit in Georgia. See, 3rd Rock Logistics, LLC v. Occidental Petroleum Corp.,
Nor is transfer appropriate where the forum selection clause is only permissive. "For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented."
In three ways, however, "[t]he calculus changes ... when the parties' contract contains a valid forum-selection clause[.]" Atl. Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas,
NTG argues that the changed calculus set forth in Atlantic Marine applies regardless of whether the clause is mandatory or permissive. It relies on Magistrate Judge Knowles' decision in Enkema v. FTI Consulting, Inc., No. 3:15-1167,
"Although Atlantic Marine never addressed the 'permissive' versus 'mandatory' distinction, district courts across the country have generally limited the Atlantic Marine framework to situations where the forum selection clause is mandatory." Waste Mgmt. of Louisiana, L.L.C. v. Jefferson Par.,
Although the Atlantic Marine Court did not expressly hold that only a mandatory forum selection clause modifies the forum non conveniens framework, the Court's rationale makes clear that this is so. [ Atl. Marine,]134 S.Ct. at 581-82 (suggesting the modified framework applies *833"when a plaintiff agrees by contract to bring suit only in a specified forum" (emphasis added) );id. at 583 n.8 (modified framework applies "when the plaintiff has violated a contractual obligation by filing suit in" another forum)....
Accordingly, determination of whether the forum selection clause here is permissive or mandatory is critical. If it is mandatory, then Atlantic Marine controls and [plaintiff] bears the burden of proving why it should not be enforced. If it is permissive, then the traditional forum non conveniens analysis applies and [defendant] bears a "heavy burden" in opposing [plaintiff's] alternative forum.
BAE Sys. Tech. Sol. & Servs.,
In its reply brief, NTG argues that "Scepter has ignored the agreement that it would waive all objections to venue and jurisdiction, including forum non conveniens. " (Doc. No. 12 at 2). This is an exceedingly short argument (consisting of less than a paragraph) perhaps because Specter brought suit in this Court and is waiving nothing. As for forum non conveniens , there is nothing before the Court to indicate that this is an inconvenient forum. Indeed, NTG does not make the argument even though "the defendant carries the burden of establishing an adequate alternative forum and showing that the plaintiff's chosen forum is unnecessarily burdensome based on public and private interests." Hefferan v. Ethicon Endo-Surgery Inc.,
Also in its reply brief, NTG points to additional terms that are allegedly on its website and that were incorporated into the contract between the parties. The website identifies Customer Terms and Conditions which, among other things, contains a "Governing Law and Forum" provision that reads:
These Terms will be deemed to have been drawn in accordance with the statutes and laws of the state of Georgia and in the event of any disagreement or dispute, the laws of Georgia will apply, *834without regard to its choice or conflict of law rules, and suit must be brought exclusively in Georgia as each Party specifically submits to the exclusive personal jurisdiction of such courts for disputes involving these Terms or the Services. By doing business with NTG, Customer hereby submits to the jurisdiction and venue of the state courts located in Fulton County, Georgia, or a venue to be decided at the sole discretion of Nolan Transportation Group, with respect to any and all matters arising from this agreement. Customer herby [sic] waives all objections to venue and jurisdiction, including forum non conveniens. By doing business with NTG you are subject to NTG's continued terms and conditions contained herein.
Doc. No. 12-1 at 6). However, in its Complaint, Scepter alleges that there were no such terms and conditions on the website when Tooley signed the Customer Profile Form, and that Scepter first saw the Customer Terms and Conditions two weeks after the apparent theft when those provisions were sent to Specter by NTG. These allegations must be accepted as true for purposes of a motion to dismiss under Rule 12(b)(6), Ashcroft v. Iqbal,
III. Conclusion
For the foregoing reasons, NTG's Motion to Dismiss Under F.R. Civ. P. 12(b)(6) or Alternatively to Transfer Venue Under
An appropriate Order will enter.
"When a court is presented with a Rule 12(b)(6) motion, it may consider the Complaint and any exhibits attached thereto, public records, items appearing in the record of the case and exhibits attached to defendant's motion to dismiss so long as they are referred to in the Complaint and are central to the claims contained therein." Bassett v. Nat'l Collegiate Athletic Ass'n,
Reference
- Full Case Name
- SCEPTER, INC. v. NOLAN TRANSPORTATION GROUP, LLC
- Cited By
- 11 cases
- Status
- Published