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Connecticut Addiction Medicine, LLC v. Elab Solutions Corp.

United States District Court, D. Connecticut

January 11, 2018



          Vanessa L. Bryant United States District Judge

         This action involves a contract dispute between Connecticut Addiction Medicine, LLC (“Plaintiff” or the “Practice”) and Defendant eLab Solutions Corporation doing business as eLab Consulting Services, Inc. (“Defendant” or “eLab”). Plaintiff raises claims of breach of contract, negligence, negligent misrepresentation, breach of the covenant of good faith and fair dealing, and a violation of the Connecticut Unfair Trade Practices Act (“CUTPA”), Conn. Gen. Stat. § 42-110 et seq., which are all related to the Defendants' actions in executing and performing the contract. Defendant now seeks to dismiss the case for improper venue pursuant to Fed.R.Civ.P. 12(b)(3) or, in the alternative, transfer the case to the Northern District of Georgia, which is where Fulton County, Georgia is located. For the foregoing reasons, dismissal is DENIED but the Court GRANTS transfer to the Northern District of Georgia.


         The Practice performs medical services that include drug testing. [Dkt. 1-1 (Compl.) ¶ 1]. In 2013, the Practice entered into the first of several Program Agreements with eLab arranging for eLab to provide staff, products, and training to facilitate testing. Id. ¶ 3. The Program Agreement included a Committed Products Addendum, which outlined types of kits the Practice would purchase and the costs associated per kit and per test and upon which the Practice relied. Id. ¶ 4. The Complaint alleges eLab breached the Program Agreement by failing to (a) properly represent costs, (b) train employees, (c) monitor the products, and (d) perform quality control. Id. ¶ 8.

         The parties entered into several successive one-year program agreements. See [Dkt. 13-4 (Mot. Dismiss Ex. 4, Program Agreement 8/2013) at 2; Dkt. 13-6 (Mot. Dismiss Ex. 6, Program Agreement 2/2014) at § 15(b); Dkt. 13-7 (Mot. Dismiss Ex. 7, Program Agreement 7/2014) at § 15(b)]. All of the program agreements in evidence contain a forum selection clause, which reads:

The rights and obligations of the parties hereunder shall be governed by and construed in accordance with the laws of the State of eLab's manufacturing location, without reference to its choice of law provisions. Each party hereby irrevocably consents to the exclusive jurisdiction of the state and federal courts located in the county and state of eLab's manufacturing location, in any action arising out of or relating to this Agreement and waives any other venue to which it may be entitled by domicile or otherwise.

Id. at § 15(b). None of the submitted Program Agreements define “manufacturing location.”

         Relying on the forum selection clause, Defendant moves for an order dismissing the case for lack of venue or transferring venue to the Northern District of Georgia where eLab manufacturing operations are located. [Dkt. 13-1 (Mot. Dismiss Mem.) at 4-5]. Plaintiff objects to dismissal and transfer, arguing principally that the forum selection clause is vague, ambiguous, undefined, not clearly communicated, and that enforcement would be unreasonable and unjust. [Dkt. 26 (Obj'n to Mot. Dismiss) at 1].


         As an initial matter, transfer rather than dismissal is appropriate here. The prescribed manner by which to enforce a valid forum selection clause specifying a different federal district is to transfer under 28 U.S.C. § 1404(a), not dismissal pursuant to Fed.R.Civ.P. 12(b)(3). See Atl. Marine Constr. Co., Inc. v. United States Dist. Court for the W. Dist. of Texas, 134 S.Ct. 568, 575, 579-80 (2013). Where the forum selection clause points to a state or foreign jurisdiction, a court can dismiss a case under the forum non conveniens doctrine. Id. at 580.[1] In view of the diversity of the parties and the resulting availability of federal court jurisdiction and the fact that neither party has suggested this case should be litigated in state court, the court will consider whether the case should be transferred rather than dismissed. See 28 U.S.C. § 1332.

         A court typically looks at pleadings and affidavits when evaluating a motion to dismiss based on a forum selection clause. See Martinez v. Bloomberg LP, 740 F.3d 211, 216-17 (2d Cir. 2014). This Court will also rely on additional undisputed evidence submitted by the parties. See New Moon Shipping Co., Ltd. v. MAN B&W Diesel AG, 121 F.3d 24, 33 (2d Cir. 1997) (approving appellants' introduction of “additional evidence to support their claim of unreasonableness before the district court”); Martinez, 740 F.3d at 216-17 (requiring a court to conduct an evidentiary hearing to resolve disputed factual questions).

          I. Enforceability of the Forum Selection Clause

         The critical question in this case is whether the forum selection clause is enforceable as the answer impacts the standard used to determine the appropriateness of transfer under 28 U.S.C. § 1404(a). Where a forum selection clause is unenforceable or otherwise not applicable, a court is to engage in the standard transfer analysis and consider the parties' private interests and other public interest factors. See Atl. Marine, 134 S.Ct. at 581 n.6 (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n.6 (1981). A valid forum selection clause alters this analysis by precluding the court from giving weight to the plaintiff's choice of forum and from considering the parties' private interests; a court must instead consider only arguments about public-interest factors. Id. at 583. A court is also bound by the choice of law provision “[i]n all but the most unusual circumstances.” Id.; see Charter Oak Oil Co., Inc. v. Applied Underwriters, Inc., No. 17-cv-00689, slip op. at 1 (D. Conn. Sept. 12, 2017) (citing Atl. Marine, 134 S.Ct. at 581-82).

         A forum selection clause is enforceable if it satisfies the Second Circuit's ...

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