FCCI Insurance Company v. Mountain Reclamation & Construction, LLC et al

Filing 37

ORDER granting 30 --motion to dismiss under forum non conveniens; directing the clerk to CLOSE the case. Signed by Judge Steven D. Merryday on 12/20/2017. (BK)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
FCCI INSURANCE COMPANY,
Plaintiff,
v.

CASE NO. 8:17-cv-2027-T-23AAS

MOUNTAIN RECLAMATION &
CONSTRUCTION, LLC, et al.,
Defendants.
____________________________________/

ORDER
FCCI Insurance Company sues (Doc. 1) fifteen contractors for breach of an
indemnity agreement. The Commonwealths of Kentucky and Virginia contracted
with the defendants to “stabilize” or to “rehabilitate” several defunct coal mines.
(Doc. 1-2) Because the commonwealths work only with a bonded contractor, FCCI
agreed to guarantee the defendants’ satisfaction of the Virginia and Kentucky
contracts, and the defendants agreed to indemnify FCCI if a commonwealth claimed
against an FCCI bond. FCCI paid, but the defendants allegedly failed to indemnify
FCCI for, at least $227,718.89 in claims. The indemnity agreement provides that an
action for breach of the indemnity agreement “shall be brought in a court of
competent jurisdiction in Sarasota County, Florida.” (Doc. 1-1 at 9) Moving to
dismiss for improper venue and forum non conveniens, the defendants argue that venue
is improper in the Middle District of Florida and that the defendants agreed to litigate

only in Sarasota County. Although including Sarasota County, the Tampa division
sits in Hillsborough County.1
DISCUSSION
I. Improper venue
The complaint attempts to invoke venue under 28 U.S.C. § 89(b) and under
28 U.S.C. § 1391(b).2 Not a venue statute, Section 89(b) lists the counties that
constitute the Middle District of Florida. Section 1391(b) lays venue in:
(1) a judicial district in which any defendant resides, if all defendants
are residents of the State in which the district is located.
(2) a judicial district in which a substantial part of the events or
omissions giving rise to the claim occurred . . .
(3) if there is no district in which an action may otherwise be brought
as provided in this section, any judicial district in which any defendant
is subject to the court’s personal jurisdiction with respect to such
action.

FCCI concedes that venue in the Middle District of Florida is improper under
Section 1391(b)(1). The Hurleys reside in Kentucky, and the corporate defendants
reside in Kentucky or West Virginia. (Doc. 1 at ¶¶ 2–16).
According to the defendants, FCCI fails to show that a “substantial part of
the events or omissions giving rise to the claim occurred” in the Middle District of
Florida. In a breach-of-contract action, venue lays in the place of performance.
American Carpet Mills v. Gunny Corp., 649 F.2d 1056, 1059 (5th Cir. July 6, 1981).

1

Local Rule 1.02(b)(4).

2

FCCI denies the necessity for an evidentiary hearing on venue. (Doc. 34 at 5)

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If a contract omits mentioning the place of performance and if the defendant fails to
pay money owed under the contract, the breach of contract occurs where the plaintiff
resides, that is, the place to which the defendant should have but allegedly failed to
send money. See, e.g., Florida Nursing Home Ass’n v. Page, 616 F.2d 1355 (5th Cir.
1980) (affirming venue in the Southern District of Florida and observing that “[n]ot
only does appellant maintain a large office there but the payments which the
[appellee] is seeking were allegedly due it within the Southern District where [the
appellees] are located”), rev’d on other grounds, 450 U.S. 147 (1981)). Although the
indemnity agreement identifies no address to which the defendants must send
money, FCCI resides in Sarasota County. (Doc. 34-1) Because a substantial part of
the “events or omissions giving rise” to the action occurred in the Middle District of
Florida — the district to which the defendants should have but allegedly failed to
send money — venue is proper under Section 1391(b)(2).
II. Forum non conveniens
If venue lays under Section 1391 but the parties agreed to litigate in a state
court, the defendant may move to dismiss under forum non conveniens. Atlantic
Marine Const. Co., Inc. v. U.S. Dist. Ct. for the Western Dist. of Tex., 134 S.Ct. 568, 580
(2013). Except in an extraordinary circumstance, the parties’ agreement to litigate
in state court deserves deference. Atlantic Marine, 134 S.Ct. at 581 (“[A] valid
forum-selection clause should be given controlling weight in all but the most

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exceptional cases.”) (internal quotation omitted). For several reasons, FCCI opposes
(Doc. 34) the defendants’ motion to dismiss under forum non conveniens.
First, FCCI argues that the indemnity agreement permits an action in the
U.S. District Court for the Middle District of Florida. But the indemnity agreement
mandates suing in a “court of competent jurisdiction in Sarasota County.” (Doc. 1-1
at 9 (italics added)) Although the Middle District of Florida includes Sarasota
County, the Tampa division sits in Hillsborough County. Because FCCI sued in a
court “in” Hillsborough County rather than a court “in” Sarasota County, FCCI
violated the forum-selection provision. See Cornett v. Carrithers, 465 Fed.Appx. 841
(11th Cir. Mar. 2, 2012) (remanding an action removed to a court in Duval County
where the contract mandated litigating in Suwannee County); Mobile Aggregates
Recycling Servs., Inc. v. Collier Aggregates, LLC, 2013 WL 2479782 (M.D. Fla. June 10,
2013) (Steele, J.) (dismissing an action for improper venue where the district judge sat
in Lee County but the contract mandated litigating in Collier County).3
Second, FCCI cites a peculiar provision in the indemnity agreement and
argues that FCCI’s suing in Hillsborough County implicitly waived the defendants’
right to enforce the forum-selection provision. (Doc. 34 at 13–14) The indemnity
agreement provides FCCI “the right, in its sole discretion, to waive venue . . .
3

In Mosaic Fertilizer, LLC v. Van Fleet Intern. Airport Dev. Grp., LLC, 486 Fed.Appx. 869
(11th Cir. Aug. 15, 2012) (affirming the district court’s denial of a motion to dismiss for improper
venue), the defendant bought land in Hardee County, and the contract mandated venue in the
county “in which the Property is located.” Rendering superfluous the word “in,” a district judge
sitting in Hillsborough County denied a motion to dismiss for improper venue and reasoned that the
Middle District of Florida “includes” Hardee County. Mosaic Fertilizer is neither binding nor
persuasive.

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in Sarasota County.” (Doc. 30-1 at 9) But the waiver provision appears
meaningless if applied literally to this circumstance. “Venue” describes a convenient
or mutually-agreed location for the litigation; in every dispute, venue lays in at least
one court, whether federal, state, or foreign. Because venue always lays somewhere,
a party cannot “waive venue” entirely — but a party can waive an objection to, or a
defense of, improper venue. See, e.g., Booth v. Carnival Corp., 522 F.3d 1148, 1153
(11th Cir. 2008) (observing that “defendants can, and often do, waive their defense
of improper venue.”); Rule 12(h), Federal Rules of Civil Procedure (providing that a
party waives an objection to improper venue by failing to include the defense in
either a motion to dismiss or an answer). Although permitting FCCI to waive an
objection to improper venue if the defendants sue FCCI outside Sarasota County,
the provision confers on FCCI no right to prohibit the defendants’ enforcing the
forum-selection provision when FCCI sues the defendants.4
Third, FCCI argues that the indemnity agreement “does not expressly exclude
the federal courts.” (Doc. 34 at 10) On the contrary, the parties’ agreement to venue
“in Sarasota County,” a county in which no federal court sits, necessarily precludes

4

FCCI drafted the indemnity agreement. To the extent the “waiver” provision is ambiguous
(the provision appears susceptible to one sensible interpretation—that FCCI may waive an objection
to venue if sued outside Sarasota County), the ambiguity favors the defendants. See, e.g., Citro
Florida, Inc. v. Citrovale, S.A., 760 F.2d 1231 (11th Cir. 1985) (construing an ambiguous
forum-selection provision against the drafter).

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suing in federal court.5 See Paolino v. Argyll Equities, L.L.C., 2005 WL 2147931
at *4–*5 (W.D. Tex. Aug. 31, 2005) (collection decisions).
CONCLUSION
Despite agreeing that “any suit brought upon [the indemnity agreement] shall
be brought in a court of competent jurisdiction in Sarasota County” (Doc. 30-1 at 9),
FCCI sued in Hillsborough County. Because no “exceptional” circumstance in this
action warrants disregarding the parties’ agreement to litigate in Sarasota County, the
motion (Doc. 30) to dismiss under forum non conveniens is GRANTED, and the action
is DISMISSED. The clerk is directed to CLOSE the case.
ORDERED in Tampa, Florida, on December 20, 2017.

5

Also, 28 U.S.C. § 89(b) identifies eight cities in which the Middle District may hold court
but includes no city in Sarasota County. See United Dominion Indus., Inc. v. United States, 532 U.S.
822, 834–36 (2001) (“[T]he mention of some implies the exclusion of others not mentioned”).

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