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Pro Step Marketing, Inc. v. Real Estate Webmasters, Inc.

United States District Court, W.D. North Carolina, Statesville Division

August 21, 2017




         THIS MATTER IS BEFORE THE COURT on Defendant Real Estate Webmasters, Inc.'s Motion to Dismiss under the doctrine of forum non conveniens, and under Rule 12(b)(3) of the Federal Rules of Civil Procedure. (Doc. 10).[1] Defendant argues the present case should be dismissed on the grounds of forum non conveniens because the most appropriate forum is the court system of the Province of British Columbia, and second, in the alternative, the case should be dismissed pursuant to Rule 12(b)(3) of the Federal Rules of Civil Procedure on the basis of improper venue. (Doc. 8). Plaintiff filed a Brief in Opposition to Defendant's Motion to Dismiss. (Doc. 15). No reply brief has been filed by Defendant and the time for filing has elapsed. Accordingly, Defendant's Motion to Dismiss is now ripe for disposition. The Court finds dismissal under the doctrine of forum non conveniens appropriate, and therefore, for the reasons set forth below, Defendant's Motion to Dismiss (Doc. 10) is GRANTED.


         In August of 2015, Pro Step Marketing, Inc. (“Plaintiff”) entered into a purchase agreement[2] (the “Agreement”) with Real Estate Webmasters, Inc. (“Defendant”). (Doc. 1-1 at 5). The Agreement provided that Defendant would purchase selected operating assets from Plaintiff for up to $250, 000, but not less than $150, 000. (Doc. 17 at 4).[3] The selected operating assets included: Plaintiff's customer base; any and all of Plaintiff's lead databases; Plaintiff's trade name; all intellectual property of the Plaintiff; website domains and necessary software for the operation of the Plaintiff's website; Plaintiff's branding tools; and all of Plaintiff's accounts. (Id. at 5-6). Defendant was to pay a deposit of $50, 000 at the closing, and an additional $200, 000 was to be paid in installments of $50, 000, every 120 days, provided that 90% of the hosting account's revenue at the closing remained at each payout date. (Id. at 6).

         The Agreement also contained a forum-selection clause that stated: “[a]ll agreements and other documents will be governed by and construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable in such province and the parties hereto irrevocably attorn to the jurisdiction of the courts of such province.” (Id. at 10). The Agreement further stated that “[t]he parties will negotiate the terms and conditions of a definitive agreement which shall supersede this Agreement (the ‘Definitive Agreement') and related documentation, which will set forth all of the terms and conditions of the Transaction . . . .” (Id. at 4).

         On September 30, 2015, Plaintiff and Defendant executed a letter that was to serve as an addendum (the “September 30 Addendum”) to the Agreement. (Id. at 13). The September 30 Addendum stipulated, “[t]he terms of the Agreement executed on August 28th, 2015 and this Addendum become the Definitive Agreement for the purchase of the selected operating assets of Pro Step.” (Id.). The September 30 Addendum did not explicitly restate the forum-selection clause contained in the Agreement. (Id.).

         Plaintiff filed suit against Defendant in the General Court of Justice, Superior Court Division, of Lincoln County, North Carolina, alleging one count of breach of contract. (Doc. 1-1 at 2). Subsequently, Defendant removed the case to this Court in May of 2016. (Doc. 1). Defendant also filed suit against Plaintiff in a civil action in the Supreme Court of British Columbia, [4] alleging six causes of action for Breach of the Agreement, Breach of the Duty of Good Faith, Misrepresentation, Breach of the Non-Solicitation Clause, Breach of Confidentiality, as well as personal liability against Patricia Andreassen (President of Pro Step Marketing, Inc.). (Doc. 8 at 2).

         Defendant, in the instant case, filed a motion to dismiss for improper venue pursuant to the doctrine of forum non conveniens, and under Rule 12(b)(3) of the Federal Rules of Civil Procedure. (Doc. 10). Defendant claims the forum-selection clause contained in the Agreement is reasonable and mandatory, and therefore is valid and enforceable, because (1) the forum-selection clause was not fraudulently induced; (2) the forum-selection clause was contained expressly in the Agreement; (3) the forum-selection clause is not violative of public policy; and (4) the forum- selection clause contains language, such as the phrase “hereto irrevocably attorn” as well as the words “all” and “will, ” which gives jurisdiction exclusively to the courts of the Province of British Columbia. (Doc. 8). Plaintiff maintains that this Court is the proper venue and argues the forum-selection clause is invalid and permissive because (1) it was prepared and executed without the assistance of legal counsel; (2) it is violative of public policy; (3) it was not ultimately included in the Definitive Agreement; and (4) the term “attorn” does not represent mandatory or exclusive language. (Doc. 15). Both parties have stipulated to the admissibility of certain documents for the purposes of this motion. (Doc. 17 at 1).


         A. Standard of Review

         “When the parties have agreed to a valid forum-selection clause, a district court should ordinarily transfer the case to the forum specified in that clause.” Atl. Marine Constr. Co., Inc. v. U.S. Dist. Ct. for W. Dist. of Tex., 134 S.Ct. 568, 581 (2013). The “‘enforcement of valid forum-selection clauses, bargained for by the parties, protects their legitimate expectations and furthers vital interests of the justice system.'” Id. (quoting Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 33 (1988) (Kennedy, J., concurring)). The doctrine of forum non conveniens and 28 U.S.C. § 1404(a) are proper procedural mechanisms in federal court for the enforcement of a forum-selection clause. Id. at 579-80. Transfer pursuant to § 1404(a) is the prescribed enforcement mechanism of transfer when a forum-selection clause “point[s] to a particular federal district.” Id. at 579. However, dismissal pursuant to the doctrine of forum non conveniens is “the appropriate way to enforce a forum-selection clause pointing to a state or foreign forum . . . .” Id. at 580 (emphasis added). Further, a valid forum-selection clause pointing to a foreign forum should be “given controlling weight in all but the most exceptional cases.” Id. at 579.

         The common-law doctrine of forum non conveniens permits “a district court having jurisdiction and proper venue to dismiss an action in its discretion because the action is more appropriate for resolution in a foreign jurisdiction.” Slight By & Through Slight v. E.I. DuPont De Nemours & Co., 979 F.Supp. 433, 436-37 (S.D. W.Va. 1997). In order to dismiss a case under the doctrine of forum non conveniens, “‘dismissal must be based on the finding that, when weighed against plaintiff's choice of forum, the relevant public and private interests strongly favor a specific, adequate, and available alternative forum.'” Tang v. Synutra Int'l, Inc., 656 F.3d 242, 246 (4th Cir. 2011) (quoting Kontoulas v. A.H. Robins Co., 745 F.2d 312 (4th Cir. 1984)). In making this determination, the Court must consider whether an alternative forum is: (1) available; (2) adequate; and (3) more convenient in light of the public and private interest factors involved. See 656 F.3d at 248. “[T]he defendant has the burden of proof to show the existence of an alternate, adequate, and available forum.” Galustian v. Peter, 591 F.3d 724, 731 (4th Cir. 2010). Further, “‘a plaintiff's choice of a proper forum is a paramount consideration in any determination of a transfer request, and that choice . . . should not be lightly disturbed.'” Datasouth Computer Corp. v. Three Dimensional Tech.'s, Inc., 719 F.Supp. 446, 451 (W.D. N.C. 1989) (quoting Western Steer-Mom ‘N' Pop's, Inc. v. FMT Inv.'s, Inc., 578 F.Supp. 260, 265 (W.D. N.C. 1984)).

         The requirement that an alternative forum be available is generally satisfied when the defendant is merely “amenable to process” in the foreign jurisdiction. See Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254 n.22 (1981) (quoting Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 506-07 (1947)). The requirement that an alternative forum be adequate is satisfied when “‘(1) all parties can come within that forum's jurisdiction, and (2) the parties will not ‘be deprived of all remedies or treated unfairly, even though they may not enjoy the same benefits as they might receive in an American court.''” Fid. Bank PLC v. N. Fox Shipping N.V., 242 Fed. App'x 84, 90 (4th Cir. 2007) (unpublished per curiam) (quoting Mercier v. Sheraton Int'l, Inc., 935 F.2d 419, 424 (1st Cir. 1991)). “In rare circumstances, however, where the remedy offered by the other forum is clearly unsatisfactory, the other forum may not be an adequate alternative, and the initial requirement may not be satisfied.” Piper Aircraft, 454 U.S. at 254 n. 22.

         The court must first consider the availability and adequacy requirements, and after a determination that they are both met, the court must then weigh the public and private interest factors. See Tang, 656 F.3d at 249. The private interest factors include:

the ‘relative ease of access to sources of proof; availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses; possibility of view of premises, if view would be appropriate to the action; and all other practical problems that make trial of a case easy, expeditious, and inexpensive.'

Piper Aircraft, 454 U.S. at 241 n.6 (quoting Gilbert, 330 U.S. at 508). The public interest factors include:

the administrative difficulties flowing from court congestion; the ‘local interest in having localized controversies decided at home;' the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action; the avoidance of unnecessary problems in conflict of laws, or in the application of foreign law; and the unfairness of burdening citizens in an unrelated forum with jury duty.

Piper Aircraft, 454 U.S. at 241 n.6 (citing Gilbert, 330 U.S. at ...

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