Perficient, Inc. v. Priore

Filing 29

MEMORANDUM AND ORDER OF TRANSFER. IT IS HEREBY ORDERED that the motion to transfer [ 14 -2] is granted, and this case is transferred to the United States District Court for the District of Massachusetts Boston. IT IS FURTHER ORDERED that the preli minary injunction hearing currently set for March 14, 2016, at 9:00 a.m. is vacated, but all other Orders of this Court remain in full force and effect unless modified or vacated by the United States District Court for the District of Massachusetts. Signed by District Judge Catherine D. Perry on 3/7/2016. (CBL)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
PERFICIENT, INC.,
Plaintiff,
vs.
NICHOLAS PRIORE,
Defendant.

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Case No. 4:16 CV 249 CDP

MEMORANDUM AND ORDER OF TRANSFER

Nicolas Priore was a technical consultant for Perficient, Inc., in its Boston,
Massachusetts office from July 31, 2014 until February 11, 2016. Perficient
assigned Priore to work for its client, Seniorlink, in June of 2015. That assignment
required Priore to work onsite at Seniorlink’s offices in Boston and provide
support for various technology systems, including Pegasystems.1 In February of
2016, Priore was hired directly by Seniorlink, which did not thereafter renew its
contract with Perficient. Perficient alleges that Priore is prohibited from working
for Seniorlink under a non-compete agreement he signed with Perficient, which it
now sues to enforce.
On February 29, 2016, I entered a Temporary Restraining Order [22]
preventing Priore from working on any Pegasystems projects for Seniorlink. That

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Pegasystems is a software system developed and sold by a third-party and is not proprietary to
Perficient.

Order remains in effect until March 14, 2016, when a hearing on Perficient’s
motion for preliminary injunction is set. The matter is now before me on Priore’s
motion to transfer this case to the United States District Court for the District of
Massachusetts – Boston under 28 U.S.C. § 1404(a).2 I will grant the motion to
transfer.
Background Facts
Priore lives and works in Boston. As a technical consultant for Perficient,
Priore was responsible for, among other things, installing and supporting various
Pegasystems applications and platforms. Priore became certified to work on
Pegasystems while employed at Perficient and was then sent to work at one of
Perficient’s clients, Seniorlink, to provide support on Seniorlink’s Pegasystems
projects. According to his testimony at the TRO hearing, Priore worked Monday
through Thursday at Seniorlink’s Boston office and worked on Fridays at
Perficient’s Boston office. Priore worked at Seniorlink for about seven months as
a Perficient employee and then went to work directly for Seniorlink. After Priore
left Perficient, Seniorlink did not renew Perficient’s contract to provide services
and support for its Pegasystems projects. Perficient alleges that, as an employee of
Seniorlink, Priore is continuing to work on the same Pegasystems projects he
2

The motion to transfer is contained in Priore’s “Motion to Dismiss Case for Lack of Subject
Matter Jurisdiction Pursuant to Rule 12(b)(1) or, in the Alternative, to Transfer Venue Pursuant
to Rule 12(b)(3) and 28 U.S.C. § 1404(a).” [14]. I denied the motion to dismiss portion of this
motion at the temporary restraining order hearing.
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worked on while an employee of Perficient, is performing the same tasks he was
performing while at Perficient, and is providing other products and services to
Seniorlink that are competitive with the products and services offered by
Perficient. Seniorlink is not a party to this lawsuit.
Priore’s employment with Perficient was governed by a non-compete
agreement which prevented him from providing competitive products or services
to any Perficient client with whom he had worked for a period of two years. The
agreement also states that it is “governed by the laws of the state where the
Employee is domiciled,” (which is Massachusetts) and that “the state and federal
courts situated in St. Louis, Missouri shall have personal jurisdiction over the
Company and Employee to hear all disputes arising under this Agreement.”
Count I of the state-court petition alleges that Priore is violating his noncompete agreement and seeks to enjoin Priore from working for Seniorlink for a
period of 24 months, and also seeks the return of any Perficient property. Count II
alleges a breach of the non-compete agreement and requests damages for Priore’s
alleged breach of his restrictive covenants.
Discussion
Priore moves to transfer this case to a more convenient forum, the United
States District Court for the District of Massachusetts – Boston, under 28 U.S.C. §
1404(a), which permits a district court to transfer a civil action to any other district
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where it might have been brought “[f]or the convenience of parties and witnesses,
in the interest of justice.” “A case may be transferred under § 1404(a) only when
venue is proper in the transferor and transferee forums.” Steen v. Murray, 770
F.3d 698, 701 (8th Cir. 2014). Because Priore voluntarily removed this case to this
Court, venue is proper here. Adams v. Smithkline Beecham Corp., Case No.
4:15CV1829 (CEJ), 2016 WL 469369, at *2 (E.D. Mo. Feb. 8, 2016). As such,
this case may be transferred to the United States District Court for the District of
Massachusetts under § 1404(a) if it could have originally been filed there. This
case could have been filed in Massachusetts as Priore resides there. See 28 U.S.C.
§ 1391(b)(1).
To determine whether the statutory factors justify transfer to the District of
Massachusetts, this Court should consider the convenience of the parties and
witnesses, including the willingness of witnesses to appear, the ability to subpoena
witnesses, and the adequacy of deposition testimony, the accessibility of records
and documents, the location where the complained of conduct occurred, and choice
of law. See Terra International, Inc. v. Mississippi Chemical Corp., 119 F.3d 688,
696 (8th Cir. 1997). The Court may also consider judicial economy, plaintiff’s
choice of forum, the comparative costs to the parties of litigating in each forum,
the ability of each party to enforce a judgment, obstacles to a fair trial, and the
advantages of having a local court determine questions of local law. C-Mart, Inc.
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v. Metropolitan Life Ins. Co., Case No. 4:13CV52 (AGF), 2013 WL 2403666, at
*3 (E.D. Mo. May 31, 2013). The “primary, if not most important of these
interests is the convenience of the witnesses.” Anheuser-Busch, Inc. v. City
Merchandise, 176 F. Supp. 2d 951, 959 (E.D. Mo. 2001) (internal quotation marks
and citation omitted). Courts are not limited to just these enumerated factors, and
they have recognized the importance of a case-by-case evaluation of the particular
circumstances presented and of all relevant case-specific factors. In re Apple, Inc.,
602 F.3d 909, 912 (8th Cir. 2010). Whether to grant or deny a request to transfer a
case under § 1404(a) is within the trial court’s sound discretion. Hubbard v. White,
755 F.2d 692, 694 (8th Cir. 1985) (citation omitted). However, courts give great
deference to a plaintiff’s choice of forum, and a party requesting transfer under §
1404(a) bears the burden of demonstrating that the transfer is justified. AnheuserBusch, Inc. v. All Sports Arena Amusement, Inc., 244 F. Supp. 2d 1015, 1022 (E.D.
Mo. 2002) (citation omitted).
To oppose transfer, Perficient relies exclusively on the forum selection
clause in Priore’s non-compete agreement. That clause provides that “the state and
federal courts situated in St. Louis, Missouri shall have personal jurisdiction over
the Company and Employee to hear all disputes arising under this Agreement.”

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According to Perficient, the clause is unambiguously mandatory, not permissive,3
because it includes the word “shall” and must be enforced according to the United
States Supreme Court’s decision in Atlantic Marine Construction Co., Inc. v.
United States District Court for the Western District of Texas, 134 S. Ct. 568
(2013). “The distinction between mandatory and permissive forum selection
clauses matters for the purposes of the § 1404 analysis.” Discovery Pier Land
Holdings, LLC v. Visioneering Envision.Design.Build, Inc., Case No. 4:14CV2073
(CEJ), 2015 WL 1526005, at *3 (Apr. 2, 2015).
If the forum selection clause is mandatory, the Court must apply the Atlantic
Marine decision and adjust its usual § 1404(a) analysis by refusing to consider
arguments about the parties’ private interests in favor of public interest factors
only. Atlantic Marine Construction Co., Inc., 134 S. Ct. at 582. Additionally,
“when the parties have a valid mandatory forum selection clause, a plaintiff filing
in a nonconforming venue may resist transfer under § 1404 only under
‘exceptional circumstances unrelated to the convenience of the parties.’”

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Perficient cites Massachusetts law regarding the interpretation of contracts because the
agreement requires that it be interpreted according to Massachusetts law. The Eighth Circuit
Court of Appeals applies federal law in a forum-selection analysis. Fru-Con Construction Corp.
v. Controlled Air, Inc., 574 F.3d 527, 538 (8th Cir. 2009). Moreover, for issues of contract
interpretation, Perficient acknowledges that Massachusetts law on the interpretation of contracts
is in accord with Missouri’s. Under either state’s laws the forum selection clause is
unambiguous.
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Discovery Pier Land Holdings, 2015 WL 1526005, at *3 (quoting Atlantic Marine
Construction Co., Inc., 134 S. Ct. at 581).
The Atlantic Marine analysis, however, does not apply where the forum
selection clause is permissive rather than mandatory. See id.; RELCO
Locomotives, Inc. v. AllRail, Inc., 4 F. Supp. 3d 1073, 1085 (S.D. Iowa 2014)
(“Because Atlantic Marine’s discussion of forum-selection clauses describes those
where ‘a plaintiff agrees by contract to bring suit only in a specified forum,’ the
Court finds that the opinion contemplated only mandatory forum-selection clauses
when assessing their effect on forum non conveniens analysis.”); U.S. ex rel. MDI
Services, LLC v. Federal Ins. Co., 2014 WL 1576975, at *3 (N.D. Ala. Apr. 17,
2014) (noting that “considerations relevant to altering the § 1404(a) analysis for
mandatory forum-selection clauses would not apply in this case” if forum selection
clause were permissive, not mandatory); Waste Management of Louisiana, L.L.C.
v. Jefferson Parish ex rel. Jefferson Parish Council, 594 Fed. Appx. 820, 821-22
(Nov. 20, 2014) (declining interlocutory appeal of district court’s finding of
permissive forum selection clause and subsequent refusal to apply Atlantic Marine
analysis, noting that vast majority of courts have refused to apply Atlantic Marine
to permissive forum selection clauses).
“To be mandatory, a forum selection clause must contain language that
clearly designates a forum as the exclusive one.” Trans National Travel, Inc. v.
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Sun Pacific International, Inc., 10 F. Supp. 2d 79, 82 (D. Mass. 1998) (internal
quotation marks and citation omitted). “An agreement conferring jurisdiction in
one forum should not be interpreted as excluding jurisdiction elsewhere unless it
contains specific language of exclusion.” Id. (internal quotation marks and citation
omitted). “Permissive forum selection clauses authorize jurisdiction and venue in
a designated forum, but do not prohibit litigation elsewhere . . . .” Claudio-De
Leon v. Sistema Universitario Ana G. Mendez, 775 F.3d 41, 46 (1st Cir. 2014)
(internal quotation marks and citation omitted).
Perficient argues that the clause is mandatory because it states that Missouri
“shall . . . hear all disputes arising under this Agreement.” [27-6]. That is not
what the forum selection clause says, Perficient’s calculated use of ellipses
notwithstanding. The clause actually says that Missouri courts “shall have
personal jurisdiction over the Company and Employee to hear all disputes arising
under this Agreement.” (emphasis supplied by the Court). The term “shall”
modifies “personal jurisdiction,” not “hear” and does not impose a mandatory
obligation upon Missouri courts “to hear all disputes arising under this agreement.”
While the clause forecloses either party’s right to contest personal jurisdiction in
Missouri, it does not obligate Missouri courts to hear this dispute to the exclusion
of any other forum. As such, the forum selection clause is permissive, not
mandatory. See OsComp Systems, Inc. v. Bakken Express, LLC, 930 F. Supp. 2d
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261, 270 (D. Mass. 2013) (noting that while word “shall,” when used in a forum
selection clause typically indicates parties’ exclusive commitment to named forum,
“there is no general rule for forum selection clauses and the determination as to
whether a clause is mandatory or permissive must turn on the specific language of
the contract at issue.”) (internal quotation marks and citation omitted); Rivera v.
Centro Medico de Turabo, Inc., 575 F.3d 10, 17 (1st Cir. 2009) (words in forum
selection clauses are “not viewed in isolation” and must be viewed in context).
Despite the use of the term “shall,” the forum selection clause at issue here is
easily distinguishable from the litany of cases cited by Perficient in its opposition
brief. In those cases, the courts did not find a mandatory forum selection clause
based solely on the use of the word “shall.” Instead, they found mandatory clauses
because the language unequivocally designated an exclusive forum. See, e.g.,
Claudio-De Leon, 775 F.3d at 46-47 (clause mandatory because it states that “any
dispute . . . shall be submitted to the jurisdiction and competence” of Puerto Rico);
Xiao Wei Yang Catering Linkage in Inner Mongolia Co., LTD v. Inner Mongolia
Xiao Wei Yang USA, Inc., 2015 WL 8751235, at *3-*4 (D. Mass. Dec. 14, 2015)
(finding clause mandatory because it states that if litigation is needed, “it shall be
the place of registration of the Overseas Management Company”); Lease
America.Org, Inc. v. Rowe International Corp., 94 F. Supp. 3d 85, 88-89 (D. Mass.
2015) (finding clause mandatory because parties “unconditionally and irrevocably”
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consented to jurisdiction in Michigan and “irrevocably waive[d] any objection” to
the exclusive jurisdiction of said courts.); Herbert H. Landy Insurance Agency, Inc.
v. Navigators Management Co., Inc., 2014 WL 3908179, at *5-*6 (Aug. 8, 2014)
(finding clause which “submits to the exclusive jurisdiction” of New York to be
mandatory); Carter’s of New Bedford, Inc. v. Nike, Inc., 2014 WL 1311750, at *2*4 (D. Mass. Mar. 31, 2014) (clause mandatory where party “irrevocably
consent[ed]” to the jurisdiction of Oregon courts and promised “not to initiate an
action . . . in any other forum.”); Kebb Management, Inc. v. Home Depot U.S.A.,
Inc., 59 F. Supp. 3d 283, 287-88 (D. Mass. 2014) (clauses providing that Georgia
had “exclusive jurisdiction over any disputes” and that “parties shall submit
disputes” to Georgia courts were mandatory); Rojas-Lozano v. Google, Inc., 2015
WL 4779245, at *3-*4 (D. Mass. Aug. 12, 2015) (finding clause mandatory which
provides: “all claims . . . will be litigated exclusively” in California and the parties
“consent to personal jurisdiction” in those courts); EMC Corp. v. Petter, 104 F.
Supp. 3d 127, 132-33 (D. Mass. 2015) (clause mandatory where parties agreed to
“submit to the exclusive jurisdiction and venue” of Massachusetts); Monsanto Co.
v. Omega Farm Supply, Inc., 91 F. Supp. 3d 1132, 1140 (E.D. Mo. 2015)
(consenting to “the sole and exclusive jurisdiction and venue” of this Court is a
mandatory forum selection clause).

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In contrast to those authorities cited above, the forum selection clause at
issue here confers personal jurisdiction in a forum where it would certainly
otherwise be lacking as to Priore, who has no connection to Missouri. In this way,
it is analogous to those forum selection clauses found permissive. See Dunne v.
Libbra, 330 F.3d 1062, 1063-64 (8th Cir. 2003) (finding permissive clause that
stated: “[t]his agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Illinois, and the parties consent to
jurisdiction [in] the state court of the State of Illinois.”); Autoridad de Energia
Electrica de Puerto Rico v. Ericsson Inc., 201 F.3d 15, 18-19 (1st Cir. 2000)
(finding clause that stated parties “expressly submit to the jurisdiction of all
Federal and State Courts in Florida” to be “an affirmative conferral of personal
jurisdiction by consent, and not a negative exclusion of jurisdiction in other
courts.”). Because the forum selection clause is permissive, not mandatory, the
Court proceeds with the traditional § 1404(a) analysis and not the modified
Atlantic Marine analysis.4 See RELCO Locomotives, 4 F. Supp. 3d at 1085;
Discovery Pier Land Holdings, 2015 WL 1526005, at *3.
As stated above, a permissive forum selection clause is given less, though
still significant, weight than a mandatory one. See Dunne, 330 F.3d at 1063
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Perficient did not address the traditional § 1404(a) factors in its opposition brief. Most of those
factors – especially the most important convenience of witnesses – weigh heavily in favor of
transfer.

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(noting that if forum selection clause is “merely permissive . . . an action on the
contract may be maintained in other reasonably convenient forums where personal
jurisdiction exists.”). In Dunne, the Eighth Circuit explained that such a
permissive forum selection clause is a “risk management tool” as it deters a
defendant from challenging personal jurisdiction and “avoids the need to rely
solely on the traditional minimum contacts analysis by providing a second,
stronger basis for jurisdiction thereby minimizing the risk that anything more than
a frivolous challenge to jurisdiction may arise.” Id. at 1064. Applying the
statutory factors, the forum selection clause, even though permissive, is
determinative in the analysis of the first factor – the convenience of the parties –
and weighs against transfer. Discovery Pier Land Holdings, 2015 WL 1526005, at
*4 (fact that parties contracted for the acceptance of Missouri courts “must count”).
The remaining factors weigh heavily in favor of transferring this action to
Massachusetts. The second factor, the convenience of witnesses, “is a primary, if
not the most important, factor in considering a motion under § 1404(a).” May
Department Stores Co. v. Wilansky, 900 F. Supp. 1154, 1165 (E.D. Mo. 1995);
Midvale Industries, Inc. v. Butler, Case No. 4:15CV1650 (JCH), 2015 WL
8479018, at *4 (E.D. Mo. Dec. 10, 2015) (convenience of witnesses is “the most
powerful factor governing the decision to transfer a case.”). This is considered the
most important factor “because it determines the relative ease of access to sources
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of proof.” Toomey v. Dahl, 63 F. Supp. 3d 982, 993 (D. Minn. 2014). “This factor
includes consideration of the number of essential non-party witnesses, their
location, and the preference of the court for live testimony as opposed to
depositions.” Id. Perficient identifies no witnesses – non-party or otherwise –
located in Missouri (or elsewhere) that are essential to its case. Given that Priore
worked for Perficient in Boston and now works for Seniorlink in Boston, it appears
unlikely that any non-party witnesses would be located in Missouri. In contrast,
Priore has identified his supervisor at Seniorlink, Michael Ciano, as an essential
non-party witness. Ciano works for Seniorlink in Boston and is outside the
subpoena power of this Court. Ciano not only interviewed and hired Priore, he has
“the authority to decide how to support the development of Seniorlink’s
Pegasystems, including which vendor to use,” including Perficient. [20-2 at 2]. In
addition to his knowledge about Priore’s activities after he began working for
Seniorlink directly, Ciano also has knowledge about Seniorlink’s refusal to renew
Perficient’s contract. These issues are central to the dispute in this case and make
Ciano an essential witness, as Perficient will have to demonstrate that Priore’s job
duties at Seniorlink constitute “competitive products or services” to prevail on its
claims.
Additionally, “accessibility of records and documents is a related factor that
courts consider.” Toomey, 63 F. Supp. 3d at 993. As Priore worked for both
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Perficient and Seniorlink in Boston, the documentary evidence related to this case
is also located there. This information includes Seniorlink’s documents, including
Priore’s work product for Seniorlink after he began his direct employment there.
As stated above, information from Seniorlink is essential to this case and is not
within the custody or control of Priore. The location and importance of key
witnesses and sources of proof weigh heavily in favor of transfer to Boston,
especially given the procedural posture of this case. The parties are currently
engaged in expedited discovery in anticipation of a preliminary injunction hearing
currently set for March 14, 2016. If discovery issues with non-party witnesses
such as Seniorlink arise, they could potentially delay the preliminary injunction
hearing. Expedient transfer of this case to the district court in Massachusetts will
permit the parties to continue ongoing discovery in anticipation of a preliminary
injunction hearing, while at the same time providing them with a readily-available
forum to resolve any potential disputes that may arise with Massachusetts nonparty witnesses.5
The location where the conduct occurred also weighs heavily in favor of
transfer. Priore worked for Perficient and Seniorlink in Boston, and any alleged
violations of his non-compete agreement took place, if at all, in Massachusetts.
Priore signed the agreement in Massachusetts, and the agreement applies
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For example, the district court could compel, if necessary, the attendance of Seniorlink
employees to testify at the preliminary injunction hearing.
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Massachusetts law. Missouri has no connection to the instant dispute, other than
the permissive forum selection clause which has been addressed and appropriately
weighed above.
The final interest of justice factor also weighs in favor of transfer, as the
comparative costs to the parties of litigating in Massachusetts will be substantially
less than if the case remains here. Although Perficient has its principal place of
business in Missouri, Priore worked for Perficient at its Massachusetts location.
To the extent its own employees are called as witnesses, they will likely be located
in Massachusetts and can be produced with less time and expense than if they were
required to travel to Missouri. The litigation costs incurred by Priore will be
substantially less if this case is transferred, as he lives and works in Boston. In the
event Perficient obtains a judgment against Priore, enforcement of that judgment
will be slightly easier if the case is transferred to his home state of Massachusetts,
but this factor is not dispositive as judgments from one district can be registered
(and then enforced) in other districts. See 28 U.S.C. § 1963. Similarly, the
advantages of having a Massachusetts court determine and apply Massachusetts
law weigh only slightly in favor of transfer.
In conclusion, Priore has met his substantial burden of demonstrating that
the balance of factors weighs strongly in favor of transferring this action to the
United States District Court for the District of Massachusetts – Boston under 28
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U.S.C. § 1404(a). For this reason, the motion to transfer will be granted. As this
Court has jurisdiction over the defendant, the Temporary Restraining Order
remains in full force and effect until its scheduled expiration date of March 14,
2016. The preliminary injunction hearing set for March 14, 2016, at 9:00 a.m. is
vacated, and Perficient should contact the Clerk’s Office for the United States
District Court for the District of Massachusetts – Boston immediately upon transfer
if it wishes to schedule a prompt preliminary injunction hearing. The expedited
discovery schedule remains in full force and effect unless modified or vacated by a
judge of that Court.
Accordingly,
IT IS HEREBY ORDERED that the motion to transfer [14-2] is granted,
and this case is transferred to the United States District Court for the District
of Massachusetts – Boston.
IT IS FURTHER ORDERED that the preliminary injunction hearing
currently set for March 14, 2016, at 9:00 a.m. is vacated, but all other Orders of
this Court remain in full force and effect unless modified or vacated by the United
States District Court for the District of Massachusetts.

Dated this 7th day of March, 2016.

CATHERINE D. PERRY
UNITED STATES DISTRICT JUDGE
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