United States District Court, W.D. North Carolina
MINA SHARPE and BELINDA McKINNON, on behalf of themselves and all others similarly situated, Plaintiffs,
ALLY FINANCIAL, INC., RANDSTAD NORTH AMERICA, INC., VACO NASHVILLE, LLC, and VACO CHARLOTTE, LLC, Defendants.
C. MULLEN, UNITED STATES DISTRICT JUDGE
matter is before the Court upon Defendant Vaco Nashville,
LLC's Motion to Dismiss, or, in the Alternative, Transfer
Due to Improper Venue. Plaintiff McKinnon has filed a brief
in opposition, and Vaco Nashville has filed a
Reply. This matter is now ripe for disposition.
filed this class and collective action complaint alleging
that Defendants violated the Fair Labor Standards Act
(“FLSA”), 29 U.S.C. § 201 et seq.,
and North Carolina Wage and Hour Act (“NCWHA”),
N.C. Gen. Stat. § 95-25.1, et seq., by failing
to pay overtime compensation to Plaintiff and other similarly
situated workers. Plaintiff was employed by Vaco Nashville, a
professional recruiting, staffing, and consulting company,
which is a Tennessee limited liability company with its
principal place of business in Brentwood, Williamson County,
Tennessee. (Am. Compl. ¶ 13.) Ms. McKinnon was employed
by Vaco Nashville and assigned to one of Vaco Nashville's
clients, Ally Financial, Inc., formerly known as GMAC.
Id. ¶ 9. Vaco Nashville paid Ms. McKinnon's
wages and provided employee benefits to her.
McKinnon signed an employment agreement with Vaco Nashville.
Among other things, Plaintiff's employment agreement
explicitly provides that she would be paid a specific hourly
rate for performing services for the benefit of Vaco
Nashville's client, GMAC, and a higher rate (consistent
with FLSA requirements) for all overtime hours she worked for
GMAC. Further, Ms. McKinnon's employment agreement
provides that “[t]his Agreement shall be governed by
the laws of Tennessee. Any litigation in connection herewith
shall be brought only in the state or federal courts for
Williamson County, Tennessee and both parties consent to such
courts' exclusive exercise of personal jurisdiction over
them.” (Doc. No. 40-1 at 8).
Amended Complaint, Plaintiff alleges that Defendants jointly
employed Plaintiff and other Anti-Money Laundering
Investigators (“AML Investigators”) pursuant to a
scheme in which Ally Financial contracted with staffing
agencies, including but not limited to Vaco Charlotte and
Vaco Nashville, to recruit, hire and assign them to perform
work as AML Investigators for Ally Financial. (Am. Compl.
¶¶ 1-2.) While the staffing agencies employed the
workers as W-2 employees and issued their paychecks, Ally
Financial oversaw virtually all aspects of their day-to-day
work. (Id. ¶ 2.) This alleged “fissured
employment” scheme was devised to shield Ally Financial
and the staffing agencies from accountability for workplace
violations and avoid their statutory obligation to pay
overtime under the FLSA and state law. (Id.)
Nashville moves under Rule 12(b)(3) of the Federal Rules of
Civil Procedure and 28 U.S.C. § 1404(a) to dismiss, or
in the alternative, transfer this case to the United States
District Court for the Middle District of Tennessee on the
basis of the forum selection clause in Plaintiff's
outset, the Court notes that dismissal pursuant to Rule
12(b)(3) would be improper in this case. The Supreme Court
has explicitly held that § 1404(a) is the exclusive
mechanism to enforce a forum selection clause that points to
another federal forum when venue is otherwise proper in the
district where the case was brought. Atl. Marine Const.
Co. v. U.S. Dist. Court for W. Dist. of Texas, 134 S.Ct.
568, 575 (2013) (“We reject petitioner's argument
that [a forum selection] clause may be enforced by a motion
to dismiss under 28 U.S.C. § 1406(a) or Rule 12(b)(3) of
the Federal Rules of Civil Procedure.”). Venue is
otherwise proper in this district because “a
substantial part of the events or omissions giving rise to
the claim occurred” in this district. 28 U.S.C.
1391(b)(2). Plaintiff alleges that she was a citizen and
resident of North Carolina and worked as an hourly-paid AML
Investigator for Ally Financial in Charlotte, North Carolina.
(Am. Compl. ¶¶ 9, 20). Accordingly, Defendant's
Motion to Dismiss will be denied.
forum selection clause that points to a particular federal
district may be enforced through a motion to transfer under
§ 1404(a). Atl. Marine, 134 S.Ct. at 579. In
order to be enforceable by a court, a forum selection clause
must be applicable to the claims at issue, valid, and
mandatory. Tracy v. Loram Maintenance of Way, Inc.,
No. 5:10-CV- 102-RLV, 2011 WL 2791257, at *3 (W.D. N.C. July
14, 2011). The language of the forum selection clause herein
is clearly mandatory because it states that the state or
federal courts for Williamson County, Tennessee (the site of
Vaco Nashville's principal place of business), shall have
exclusive personal jurisdiction over the parties,
and that any litigation in connection with the agreement
“shall be brought only” in such courts.
Plaintiff does not dispute the mandatory nature of the forum
selection clause. Rather, she focuses her argument on whether
the clause applies to her claims. Plaintiff asserts that the
forum selection clause does not encompass her non-contractual
statutory claims asserted under the FLSA and NCWHA. Although
Plaintiff acknowledges that the Fourth Circuit has not
addressed the issue of whether forum selection clauses can
apply to non-contractual claims, she cites several cases
where district courts have held that suits based on
independent statutory rights, such as those to recover
overtime payments under the FLSA, are not controlled by a
forum selection clause when those rights do not depend on any
provision of the employment agreement. See Pacheco v. St.
Luke's Emergency Assocs., P.C., 879 F.Supp.2d 136,
141-42 (D. Mass. 2012); Crouch v. Guardian Angel Nursing,
Inc., No. 07-CV-00541, 2009 WL 3738095, at *2-3 (M.D.
Tenn. Nov. 4, 2009); Perry v. Nat'l City Mortg.,
Inc., No. 05-CV-891-DRH, 2006 WL 2375015, at *4-5 (S.D.
Ill. Aug. 15, 2006); Saunders v. Ace Mortg. Funding,
Inc., No. 05-CV-1437 (DWF/SRN), 2005 WL 3054594, at *3
(D. Minn. Nov. 14, 2005).
cases cited by Plaintiff, however, are largely
distinguishable from this case in that the language of the
forum selection clause here is significantly broader than the
ones at issue in those cases. For example, the forum
selection clause in Pacheco was limited to
“any dispute derived out of” the employment
agreement, and the court explained that “derive”
meant “to take, receive, or obtain especially from a
specified source.” Pacheco, 879 F.Supp.2d at
140-41. Accordingly, the court determined that the
plaintiff's FLSA claims were not “derived
from” the employment agreement and thus beyond the
scope of the contractual forum selection clause. In
Crouch, the court held that the plaintiff's FLSA
claim was not governed by a forum selection clause that
applied to “any action to enforce any provision of this
agreement.” Crouch, 2009 WL 3738095, at * 2-3.
The Saunders court found that a forum selection
clause that applied to “this contract” did not
apply to FLSA claims and was limited to breach of contract
actions. Saunders, 2005 WL 3054594, at * 3.
Similarly, the forum selection clause in Perry
stated that it applied to “this Agreement” and
the district court, citing Saunders, held that it
did not apply to plaintiff's FLSA claim. Perry,
2006 WL 2375015, at * 4; see also Fuller v. Goldstar
Estate Buyers Corp., No. 10-cv-5839, 2011 WL 809429, at
*3 (N.D. Ill. Mar. 1, 2011).
forum selection clause in Plaintiff's employment
agreement is substantially broader, stating that it will
apply to all litigation “in connection” with the
employment agreement. Because her agreement specifically
defines Plaintiff's wage rate, including her overtime
wage rate, her claims are “connected” to her
agreement, and the forum selection clause applies.
See, e.g., Goodly v. Check-6,
Inc., No. CV 16-1936, 2016 WL 3090293, at *3 (E.D. La.
June 2, 2016) (holding that forum selection clause in
employment agreement applied to FLSA claims, where it applied
to any lawsuit filed “in connection with” the
employment agreement); Newman v. Advanced Tech.
Innovation Corp., No. 1:12CV24 JCC/TRJ, 2012 WL 1414859,
at *6 (E.D. Va. Apr. 20, 2012) (holding that forum selection
clause contained in employment agreement applied to FLSA
claims, where the clause applied to “all matters
regarding” the employment agreement and the agreement
set forth the employee's rate of pay).
Ruifrok v. White Glove Restaurant, the Maryland
District Court examined a forum selection clause that
encompassed “[t]his Agreement and the parties'
performance hereunder.” No. DKC 10-2111, 2010 WL
4103685, at *1 (D. Md. Oct. 18, 2010). In Ruifrok,
the court explained, “[i]n providing that [the forum
selection clause] applies to any action arising from
‘the parties' performance' of the agreement,
the clause encompasses the rate and manner of pay and
reimbursement to Plaintiff, which is the core of the FLSA and
related state law claims.” Id. at *6; see
also Marzano v. Proficio Mortg. Ventures, LLC, 942
F.Supp.2d 781, 790 (N.D. Ill. 2013) (contrasting the forum
selection clauses in Pacheco, Perry,
Saunders, and Fuller with the forum
selection clause in Ruifrok). Similar to the facts
in Ruifrok, here the issues of ...