Regions Equipment Finance Corporation v. Blue Tee Corp.
MEMORANDUM AND ORDER:IT IS HEREBY ORDERED that plaintiff's motion to strike defendant's jury trial demand [Doc. # 32 ] is granted. IT IS FURTHER ORDERED that the case management order [Doc. # 36 ] is amended as follows: This action is set for a NON-JURY trial on Monday, June 19, 2017, at 9:00 a.m. ( Bench Trial set for 6/19/2017 09:00 AM in Courtroom 14N before District Judge Carol E. Jackson.). Signed by District Judge Carol E. Jackson on 5/10/16. (KKS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
REGIONS EQUIPMENT FINANCE CORP.,
BLUE TEE CORP.,
Case No. 4:16-CV-140-CEJ
MEMORANDUM AND ORDER
This matter is before the Court on plaintiff’s motion to strike defendant’s jury
Defendant has responded, and the issues are fully briefed.
On January 27, 2016, plaintiff Regions Equipment Finance Corporation initiated
this action against defendant Blue Tee Corporation for breach of contract in
connection with defendant’s alleged default of an equipment lease.
the complaint, defendant demanded a jury trial.
demand was filed on April 4, 2016.
In its answer to
The instant motion to strike that
On April 11, 2016, a scheduling conference was
During that conference, the Court explained it would set the matter for a jury
trial until the motion was ready for disposition, and would amend the case
management order to set the matter for a bench trial if it found that defendant
waived its right to a jury trial.
On May 19, 2010, defendant entered into a master lease with Wells Fargo
Equipment Finance, Inc. (Wells Fargo).
Defendant and Wells Fargo
also entered into two supplements to the master lease. On May 21, 2010, inter alia,
Wells Fargo sold and assigned its interest in the master lease to plaintiff.
is alleged to have committed several “events of default” under the terms of the master
lease, giving rise to this lawsuit.
“Whether a party has a right to trial by jury is a question of law” for the courts.
United States v. STABL, Inc., 800 F.3d 476, 490 (8th Cir. 2015) (quotation marks and
The Seventh Amendment provides, in pertinent part, that “[i]n
Suits at common law, where the value in controversy shall exceed twenty dollars, the
right of trial by jury shall be preserved.” U.S. Const. amend. VII.
Seventh Amendment applies only to ‘[s]uits at common law,’ not every cause of
action implicates this right.”
Smith Flooring, Inc. v. Pa. Lumbermens Mut. Ins. Co.,
713 F.3d 933, 936–37 (8th Cir. 2013) (quoting U.S. Const. amend. VII).
“right to a jury trial in the federal courts is to be determined on the basis of federal law
in diversity as well as in other actions.”
Klein v. Shell Oil Co., 386 F.2d 659, 662 (8th
Cir. 1967) (citing Simler v. Conner, 372 U.S. 221, 222 (1963)).
“The constitutional right to a jury trial must be preserved when the litigation
involves legal and equitable claims with common issues.”
Smith Flooring, 713 F.3d
at 937 (citing Dairy Queen, Inc. v. Wood, 369 U.S. 469, 472–73 (1962), and Beacon
Theatres, Inc. v. Westover, 359 U.S. 500, 510–11 (1959)).
to try both claims to a jury.
“The normal practice is
In this way, the jury’s verdict will conclusively settle
these common issues, and only issues peculiar to the equitable claim will be left to be
decided by the judge.”
Id. (quotation marks and citation omitted).
damages for breach of contract . . . were suits at common law with the issues of the
making of the contract and its breach to be decided by a jury . . . .” Id. at 936–37
(quoting Atlas Roofing Co., Inc. v. Occupational Safety & Health Review Comm’n, 430
U.S. 442, 459 (1977)).
“Although the jury-trial right can be waived, the right is fundamental,” and
courts must “indulge every reasonable presumption against its waiver.”
Am., N.A. v. JB Hanna, LLC, 766 F.3d 841, 849 (8th Cir. 2014) (quotation marks,
citation, and bracketing omitted). However, “[a]greements waiving the right to trial
by jury are neither illegal nor contrary to public policy.”
Popular Leasing USA, Inc. v.
Austin Auto. Warehouse Corp., No. 4:04-CV-1619-TCM, 2005 WL 1798088, at *1
(E.D. Mo. July 27, 2005) (quotation marks and citation omitted).
jury trial may be waived by either a written or oral stipulation.”
“A demand for a
Clark v. Runyon, 218
F.3d 915, 918 (8th Cir. 2000).
Consequently, a party may waive its right to a jury trial under the terms of a
See JB Hanna, 766 F.3d at 849; Coop. Fin. Ass’n, Inc. v. Garst, 871 F.
Supp. 1168, 1171 (N.D. Iowa 1995) (citing Nw. Airlines, Inc. v. Air Line Pilots Ass’n,
Int’l, 373 F.2d 136, 142 (8th Cir. 1967), and collecting cases).
“For a waiver to be
effective, the party waiving the right must do so ‘voluntarily’ and ‘knowingly’ based on
the facts of the case.”
Garst, 871 F. Supp. at 1171 (citing Brookhart v. Janis, 384
U.S. 1, 4 (1966), which held, “for a waiver to be effective it must be clearly
established that there was an intentional relinquishment or abandonment of a known
right or privilege”).
“While the Eighth Circuit has not explicitly ruled which party
bears the burden of proving whether the jury waiver was made knowingly and
voluntarily, courts within the circuit have generally held that the party attempting to
enforce the waiver has the burden of proving the waiver is knowing and voluntary.”
Cty. 20 Storage & Transfer Inc. v. Wells Fargo Bank, NA, No. 3:09-CV-104, 2011 WL
826349, at *10 (D.N.D. Mar. 3, 2011) (quotation marks and citations omitted).
Court thus assumes that plaintiff bears the burden of proving that defendant’s
purported jury trial waiver is enforceable in this case.
Though no Eighth Circuit authority sets out the elements necessary to make
such a determination, courts in this circuit “have considered a number of factors to
determine whether a contractual waiver of the right to a jury was knowing and
Garst, 871 F. Supp. at 1172.
The following non-exhaustive
considerations bear on this analysis: (1) “whether the waiver provision is on a
standardized form agreement” or in a “newly-drafted document,” (2) whether it is “in
fine print or in large or bold print,” (3) whether it is “set off in a paragraph of its own,”
(4) whether the provision is “in a take-it-or-leave-it” or in a “negotiated contract,” and
(5) the conspicuousness of the waiver compared to “the length of the contract.”
Courts have also considered the following: (6) “whether the
waiving party was represented by counsel,” (7) “whether the waiving party was a
sophisticated business person aware of the consequences of the waiver,” (8) “whether
the parties were manifestly unequal in bargaining power,” and (9) “whether there was
an opportunity to review all of the terms of the contract and whether the waiving party
Id. (citations omitted); see Ihlenfeldt v. Ocwen Loan Servicing, LLC, No.
C15-2060, 2015 WL 9855874, at *2 (N.D. Iowa Nov. 4, 2015) (applying these
factors); R & R Packaging, Inc. v. J.C. Penney Corp., No. 5:12-CV-05215, 2013 WL
3776330, at *2–3 (W.D. Ark. July 17, 2013) (same); Cty. 20 Storage & Transfer,
2011 WL 826349, at *10 (same); Westgate GV at the Woods, LLC v. Dickson, No.
10-03269-CV-S-DGK, 2010 WL 4721245, at *2 (W.D. Mo. Nov. 15, 2010) (same);
Dunning v. Bush, No. 3:05-CV-00050-JAJ, 2009 WL 77461, at *2 (S.D. Iowa Jan. 12,
2009) (same); Popular Leasing USA, 2005 WL 1798088, at *1 (same).
The Court has reviewed the master lease and finds that plaintiff has met its
burden to prove that defendant explicitly waived its right to a jury trial as to all of the
claims in this case.
Contrary to defendant’s argument, it is not premature to decide
this issue—the master lease to which defendant is a party provides sufficient factual
information to answer the inquiry. See Popular Leasing USA, Inc. v. Turner Const.
Co., No. 4:05-CV-248-CEJ, 2005 WL 2874741, at *1–3 (E.D. Mo. Oct. 31, 2005)
(holding a defendant waived its right to a jury trial by contract and striking its jury trial
demand based on the contract terms and without affidavits).1
By its terms, the master lease is governed by Minnesota law.
state, a party is presumed to have read and know the contents of any contract it signs.
See Alotech, Ltd. v. N. Star Imaging, Inc., No. CV 14-3414 (RHK/TNL), 2016 WL
1122024, at *8 (D. Minn. Mar. 22, 2016) (citation omitted); Popular Leasing USA,
2005 WL 2874741, at *2 (citation omitted).
The penultimate sentence of the final paragraph of the master lease is a
conspicuous, capitalized waiver of the lessee’s—i.e., the defendant’s—right to a jury
trial, which reads:
LESSEE HEREBY WAIVES ANY RIGHT TO A JURY TRIAL WITH RESPECT
TO ANY MATTER ARISING UNDER OR IN CONNECTION WITH THIS
[Doc. #4-1 at 5]
Defendant offers only speculation and conjecture that it may not
have been aware of or agreed to the jury trial waiver.
Any reasonably sophisticated
party that read and signed the master lease containing that provision would
understand that it was agreeing to waive its right to a jury trial.
Indeed, defendant is a corporation that at one time had multiple divisions in
It does not dispute that it entered into the master lease [Doc.
#14-1], a multi-million dollar contract to finance the lease of farming and other
equipment from Wells Fargo.
That decision demonstrates both defendant’s
sophistication and the parties’ equal bargaining power.
Defendant has offered no
Defendant’s allegation that plaintiff breached also does not affect the waiver issue. See id. (enforcing
a jury trial waiver against a defendant in a breach of contract action despite the defendant’s counterclaim
that plaintiff also breached).
evidence to suggest that it did not have counsel when it negotiated and signed the
master lease, or, even if it did not, that it was denied the opportunity to read the
master lease before signing it.
Defendant subsequently entered into two
supplements to the master lease, which only further confirms that it had the
opportunity to negotiate and alter the contract terms.
For those reasons, the Court
finds that defendant unequivocally agreed to waive its right to a jury trial as to all of
the claims in this case. See Garst, 871 F. Supp. at 1172.
IT IS HEREBY ORDERED that plaintiff’s motion to strike defendant’s jury trial
demand [Doc. #32] is granted.
IT IS FURTHER ORDERED that the case management order [Doc. #36] is
amended as follows:
This action is set for a NON-JURY trial on Monday, June 19, 2017, at
CAROL E. JACKSON
UNITED STATES DISTRICT JUDGE
Dated this 10th day of May, 2016.
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