Webster Chrysler Jeep, Inc. et al v. Chrysler Holding LLC et al
Filing
123
ORDER granting 107 Motion to Strike the Jury Demand. Signed by Hon. Jonathan W. Feldman on 3/30/2012. (RJO)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
WEBSTER CHRYSLER JEEP, INC. and
RANDY HENDERSON, as its President,
Plaintiff(s),
DECISION & ORDER
08-CV-6535
v.
CHRYSLER HOLDING LLC, CHRYSLER LLC,
DAIMLERCHRYSLER FINANCIAL SERVICES
AMERICAS LLC, CHRYSLER MOTORS LLC,
and CHRYSLER REALTY COMPANY LLC,
Defendant(s).
___________________________________
CHRYSLER FINANCIAL SERVICES
AMERICAS LLC,
Plaintiff(s),
DECISION & ORDER
09-CV-6044
v.
R.H. WEBSTER REALTY, L.L.C. and
RANDOLPH B. HENDERSON, a/k/a
Randy Henderson,
Defendant(s).
Preliminary Statement
Before the Court are the validity of jury trial demands in two
separate, but related cases.1
In Civil Case No. 08-CV-6535,
Webster Chrysler Jeep, Inc. (“Webster”) and Randy Henderson, as its
President, commenced an action under the Automobile Dealer’s Day in
Court Act, 15 U.S.C. §§ 1221-1226, the New York Franchised Motor
Vehicle Act, the New York Vehicle and Traffic Law §§ 463-473, the
Equal Credit Opportunity Act, 15 U.S.C. § 1691, and state common
1
By Order entered February 10, 2010, the captioned actions
were consolidated.
law seeking injunctive relief and damages for alleged attempted
wrongful termination of a motor vehicle franchise.
See Amended
Complaint
and
(Docket
#
82).
In
both
the
original
amended
Complaints (Dockets ## 1, 82), Webster demands a jury trial.
In
Civil Case Number 09–CV-6044, Chrysler Financial Services Americas
LLC has sued R.H. Webster Realty and Randy Henderson alleging that
Webster Chrysler Jeep is in default of its obligations under
various dealership financing agreements and that they are liable
for
the
defaults
based
on
their
signing
obligations of Webster Chrysler Jeep, Inc.
(Docket # 21).
guarantees
of
the
See Amended Complaint
In its amended answer (Docket # 24), Webster
asserts three counterclaims which allege, inter alia, that Chrysler
Financial
engaged
in
racially
discriminatory
and
retaliatory
conduct by unfairly accelerating Webster Chrysler Jeep’s financial
obligations.
More specifically, Webster alleged that the actions
of Chrysler Financial violated the Equal Credit Opportunity Act
(First Counterclaim), 42 U.S.C. § 1981 of the Federal Civil Rights
Act (Second Counterclaim) and New York’s implied covenant of good
faith inherent in all contractual agreements (Third Counterclaim).
As to each of their counterclaims, R.H. Webster Realty and Randy
Henderson demand a jury trial.
Currently pending before the Court is Chrysler Financial’s
motion to strike the demands for a jury trial pursuant to Federal
Rule of Civil Procedure (“FRCP”) 39(a)(2). (Docket # 107). On July
2
6, 2011, the Court held a hearing and arguments were heard from the
parties.
Court.
Post hearing submissions were thereafter received by the
After consideration of the papers and exhibits filed in
connection with the pending motion and the arguments of counsel,
and for the reasons that follow, the Court hereby grants Chrysler
Financial’s motion to strike the demands for a jury trial (Docket
# 107).
Relevant Facts
Chrysler Financial moves pursuant to FRCP Rule 39(a)(2) to
strike Webster’s demands for a jury trial on grounds that Webster
and Henderson “contractually, knowingly and voluntarily waived
their
right
to
a
trial
by
jury.”
See
Chrysler
Financial’s
Memorandum of Law (hereinafter “Chrysler Memo”) (Docket # 108) at
p. 1.
Chrysler argues that Webster waived its right to a jury
trial, as “numerous, conspicuous” jury waivers were contained in
the various documents executed by Webster on March 27, 2002 and
December 30, 2004.
Specifically, on March 27, 2002, Webster
entered into a Master Loan and Security Agreement (“MLSA”) with
DaimlerChrysler and, pursuant to the MLSA’s terms, Webster waived
its right to a jury trial in any lawsuit commenced with regard to
the financing relationship between Webster and Chrysler Financial.
See Exhibit “1" attached to Docket # 107.
On page 12 of the MLSA
there is a separate paragraph with a title in bold, capital letters
3
that reads: “JURY WAIVER.”
Id. at p. 12.
The “JURY WAIVER”
paragraph states: “Lender, Borrower and each Guarantor waive the
right to trial by jury in any lawsuit brought by any party against
any other party.”
Id.
The very next page of the MLSA is the
signature page, and the first paragraph of that page is in all
capital letters and provides:
EACH BORROWER AND EACH GUARANTOR CERTIFY THAT: (1) THEY
HAVE AGREED TO BE SUBJECT TO THIS AGREEMENT AND EACH
RELATED DOCUMENT AS THEIR OWN FREE ACT AND DEED, WITHOUT
DURESS OR COERCION; (2) THEY HAVE CONSULTED WITH AN
ATTORNEY, OR HAD THE OPPORTUNITY TO DO SO; (3) THEY HAVE
CAREFULLY READ THIS AGREEMENT AND EACH RELATED DOCUMENT,
AND AGREE TO ALL THEIR TERMS AS WRITTEN; (4) THEY HAVE
KNOWINGLY CONSENTED TO ALL WAIVERS; AND (5) NEITHER
LENDER NOR ANYONE CONNECTED WITH LENDER HAS MADE ANY
STATEMENT OR PROMISE THAT MAY CONTRADICT IN ANY WAY WHAT
IS WRITTEN IN THIS AGREEMENT OR IN ANY RELATED DOCUMENT.
Id. at p. 13.
Randolph Henderson’s name and signature appears on
page 13 underneath the above-referenced paragraph of said MLSA
agreement.
Id.
On the same day that Webster and DaimlerChrysler entered into
the MLSA (i.e., March 27, 2002), in conjunction with the extension
of retail financing programs for Webster’s customers, Webster
entered into a Retail Installment Contract and Lease Program
Agreement (“RICLPA”).
See Exhibit “2" annexed to Docket # 107.
The RICLPA also contains a jury waiver and a certification by the
Dealer (Webster) that the Dealer has carefully read the agreement
and agrees to all of its terms and conditions, similar to the
above-referenced certification paragraph in the MLSA. See id. The
4
RICLPA jury waiver is in a separate paragraph with a separate
heading stating: “Jury Waiver.”
Id. at p. 6.
The certification
paragraph is at the top of the signature page, in all capital
letters, and has Henderson’s name and signature written beneath it.
Id. at p. 8.
Also on March 27, 2002, in conjunction with the
establishment of credit facilities with Webster, the dealerships
entered into a Certificate of Authority.
“3B” annexed to Docket # 107.
See Exhibits “3A” and
The Certificate of Authority
provided representations from various Webster employees that they
“are authorized to represent and act on behalf of the Company
[Webster].”2
Id.
Henderson, acting as General Manager, modified
the Certificate of Authority so that he was the sole individual
with authority to borrow money, execute loan documents, grant a
lender a security interest or guaranty obligations of others.
Compare Exhibit “3A” with Exhibit “3B” annexed to Docket # 107.3
On April 23, 2002, Henderson executed a Continuing Guaranty in
2
Specifically, the following Webster employees signed the
Certificate of Authority: (1) Henderson, as General Manager, (2)
Mark Ledtke, as Assistant General Manager, (3) Susan Silvernail, as
Secretary/Treasurer, and (4) Bonita Jones, as Assistant Office
Manager. See Exhibit “3A” annexed to Docket # 107.
3
In the first Certificate of Authority (Exhibit “3A”), in
which Henderson and the three other Webster representatives (a.k.a.
Ledtke, Silvernail and Jones) are listed, the authority to borrow
money, execute loan documents, grant a lender a security interest
or guaranty obligations of others are all stricken from the
document.
See Exhibit “3A.”
In the second Certificate of
Authority, in which only Henderson is listed, none of said
authorizations are stricken, evidencing Henderson’s desire to
maintain sole authority in these areas. See Exhibit “3B.”
5
favor of Chrysler Financial.
See Exhibit “4" annexed to Docket #
107. The Continuing Guaranty also contains a jury waiver, which is
in a separate paragraph with a title in boldface, capital letters
reading “JURY WAIVER.”
See id. at p.3.
The “JURY WAIVER”
paragraph appears on the same page as the signature page, which
contains
the
name
and
signature
of
Henderson
just
below
a
certification in all capital letters which indicates, inter alia,
that he has (1) “CONSULTED WITH AN ATTORNEY OR HAD THE OPPORTUNITY
TO DO SO,” (2) “THOROUGHLY READ THIS GUARANTY, THE AGREEMENT, ALL
RELATED DOCUMENTS AND ANY OTHER INSTRUMENT OR DOCUMENT EXECUTED IN
CONNECTION WITH ANY OBLIGATION, AND COMPLETELY UNDERSTAND AND AGREE
TO THEIR PROVISIONS AS WRITTEN,” and (3) “KNOWINGLY AGREED TO ALL
WAIVERS.”
Id. (emphasis added).
In October 2004, Henderson applied to DaimlerChrysler for a
real estate loan.
Conditions”
On DaimlerChrysler’s “Real Estate Terms and
document,
Henderson
represented
on
behalf
of
the
limited liability company to be formed that their legal counsel is
Harris Beach LLC.
Subsequently,
on
See Exhibit “5" annexed to Docket # 107.
December
30,
2004,
the
real
estate
loan
transaction represented in the real estate terms and conditions set
forth in the DaimlerChrysler Real Estate Terms and Conditions
document was consummated, and Henderson, as Managing Member of R.H.
Webster Realty, L.L.C., executed a Fixed Rate Promissory Note with
interest rate adjustments, as well as a Permanent Mortgage which
6
was subsequently recorded in the Office of the Monroe County Clerk
on December 30, 2004.
# 107.
See Exhibits “6" and “7" annexed to Docket
With the execution of the fixed rate Permanent Mortgage,
Henderson
executed
a
Borrower
Agreement on December 30, 2004.
# 107.
Real
Estate
Loan
and
Security
See Exhibit “8" annexed to Docket
This Agreement contains a jury waiver which is set apart in
its own Section and paragraph.
See id. at p. 14.
Specifically,
the jury waiver reads as follows:
SECTION 12.0 WAIVER OF JURY TRIAL. LENDER AND BORROWER
ACKNOWLEDGE AND AGREE THAT THERE MAY BE A CONSTITUTIONAL
RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY CLAIM,
DISPUTE OR LAWSUIT ARISING BETWEEN THEM, BUT THAT SUCH
RIGHT MAY BE WAIVED. ACCORDINGLY, THE PARTIES AGREE:
(A)
NOTWITHSTANDING SUCH CONSTITUTIONAL RIGHT, IN THIS
COMMERCIAL MATTER THE PARTIES BELIEVE AND AGREE
THAT IT SHALL BE IN THEIR BEST INTEREST TO WAIVE
SUCH RIGHT AND, ACCORDINGLY, HEREBY WAIVE SUCH
RIGHT TO A JURY TRIAL AND FURTHER AGREE THAT THE
BEST FORUM FOR HEARING ANY CLAIM, DISPUTE OR
LAWSUIT, IF ANY, ARISING IN CONNECTION WITH THIS
AGREEMENT OR RELATIONSHIP BETWEEN LENDER AND
BORROWER, INCLUDING, BUT NOT LIMITED TO, IN
CONNECTION WITH THE COLLECTION OF THE LOAN OR OTHER
OBLIGATIONS, SHALL BE A COURT OF COMPETENT
JURISDICTION SITTING WITHOUT A JURY;
(B)
THIS WAIVER OF JURY TRIAL IS FREELY, KNOWINGLY AND
VOLUNTARILY GIVEN BY EACH PARTY, WITHOUT ANY DURESS OR
COERCION, AFTER EACH PARTY HAS CONSULTED WITH ITS
COUNSEL AND HAS CAREFULLY AND COMPLETELY READ ALL OF
THE
TERMS
AND
PROVISIONS
OF
THIS
AGREEMENT,
SPECIFICALLY INCLUDING THIS WAIVER OF JURY TRIAL
PROVISION; AND
(C)
NEITHER LENDER NOR BORROWER SHALL BE DEEMED TO HAVE
RELINQUISHED THIS PROVISION WAIVING JURY TRIAL EXCEPT
BY A WRITING SIGNED BY AN OFFICER OF LENDER AND
BORROWER RELINQUISHING THIS WAIVER OF JURY TRIAL
PROVISION.
7
See id. at pp. 14-15.
The sentence immediately below this jury
waiver paragraph states: “IN WITNESS WHEREOF, the parties hereto
have executed and delivered this Agreement on the date first above
written,” and is signed by Henderson.
Id. at p. 15.
On December 30, 2004, Henderson, acting in his capacity as
President of Webster Chrysler Jeep, Inc. and as Managing Member of
R.H.
Webster
Guaranty,”
Realty,
which
L.L.C.,
served
to
executed
confirm
an
that
“All
both
Encompassing
companies
were
guarantying their respective obligations to the Chrysler entities.
See Exhibit “9" annexed to Docket # 107.
Paragraph No. 12 of this
document is in all capital letters and states, inter alia, that
this Guaranty “IS FREELY AND VOLUNTARILY GIVEN” after consulting
with counsel or having “BEEN GIVEN AN OPPORTUNITY TO DO SO.”
Id.
at ¶ 12.
Also on December 30, 2004, in conjunction with the Fixed Rate
Promissory
Note
and
Permanent
Mortgage,
Henderson,
acting
as
President of Webster Chrysler Jeep, Inc., executed a “Guarantor
Security Agreement” in conjunction with its guarantor of the
obligations of Webster Realty.
# 107.
See Exhibit “10" annexed to Docket
Once again, the document contained a jury waiver provision
which was in a separate Section/paragraph in all capital letters.
See id. at pp. 13-14.
The title of the jury waiver read as
follows: “SECTION 11.0 WAIVER OF JURY TRIAL.”
Id. at p. 13.
Immediately following the jury waiver paragraph is Henderson’s
8
signature.
Id. at p. 14.
Promissory
Note
and
Also in conjunction with the Fixed Rate
Permanent
Mortgage,
Henderson
executed
a
Continuing Guaranty on December 30, 2004. See Exhibit “11" annexed
to Docket # 107. This document contains a certification written in
all capital letters stating, inter alia, that “THIS GUARANTY IS
FREELY AND VOLUNTARILY GIVEN” after consultation with counsel or
having “BEEN GIVEN AN OPPORTUNITY TO DO SO” and “ALL OF THE TERMS
AND
PROVISIONS
COMPLETELY
OF
THIS
READ.”
Id.
GUARANTY”
at
¶
have
12.
a
letter
dated
December
“CAREFULLY
Henderson’s
immediately under this certification.
In
been
signature
AND
is
Id. at p. 4.
30,
2004,
DaimlerChrysler’s
attorney, Sienna D. Dietz, Esq. of Dickinson Wright PLLC, wrote to
R.H. Webster Realty, L.L.C.’s attorney, Leon T. Sawyko, Esq. of
Harris Beach, LLP, to “confirm the mutual understanding reached by
our respective clients concerning the” loan from DaimlerChrysler to
R.H. Webster Realty.
See Exhibit “12" annexed to Docket # 107.
Attorney Dietz listed the amendments to the Real Estate Terms and
Conditions letter signed by Henderson in October 2004 that the
parties agreed to.
Id.
Attorney Dietz’s December 30, 2004 letter
was “Acknowledged and Agreed” to by Henderson in his capacity as
Managing Member of R.H. Webster Realty, L.L.C.
Id.
Based on the foregoing, Chrysler Financial requests that the
Court issue an Order striking Webster’s demands for a jury trial on
grounds that Webster and Henderson “have knowingly waived their
9
right to a jury trial.” (Docket # 107).
Chrysler Financial argues
that Webster’s waiver of jury trial was “not procured by fraud.”
See Docket # 107 at p. 13.
Henderson
“was
a
Chrysler Financial points out that
sophisticated
businessman
with
extensive
experience in matters related to the operation of automotive
dealerships and automotive finance” and had “eleven (11) years of
experience in the automotive industry prior to the earliest date of
a business relationship with Chrysler Financial.”
Id. at ¶¶ 42,
45. Chrysler Financial asserts that “[n]either Webster CJ, Webster
Realty or Randolph Henderson individually, allege anywhere in any
pleading, that the execution of any of the documents containing a
waiver of jury trial was procured by fraud by the lender.”
Id. at
¶ 54. Chrysler Financial argues that Henderson “is a sophisticated
business man and had ample opportunity to consult with counsel
prior to the execution of the documents containing the waiver of
jury.”
Id. at ¶ 56.
In opposition, Webster asserts that “the Court must separate
the two actions to avoid expanding the jury waiver clauses beyond
their intended scope” because Webster’s “claims against Chrysler
Financial do not arise from the same nucleus of facts as the
contract documents that [Chrysler Financial] utilize[s] to support
[its] claims.” See Webster’s Memorandum in Opposition (hereinafter
“Webster Memo”) (Docket # 111) at p. 1, 3.
Webster contends that
Chrysler Financial is now trying “to use these same documents from
10
its action concerning the breach of contract proceedings to prevent
[Webster] from the opportunity for a jury trial.”
Id. at p. 3.
Webster also asserts that it did not waive its right to a jury
trial “knowingly and intentionally.”
Webster argues that the
existing dealer network financial framework for car dealers “had
been in place for decades” and “forced Mr. Henderson to sign a nonnegotiable contract with a captive financing company.”
4.
Id. at p.
Webster contends that it “depended on the financing received
from Chrysler’s captive finance arm, Chrysler Financial, to have
the capital necessary to run the dealership” and maintains that
Henderson “did not have any choice but to accept the contract as
written.”
Id. at p. 5.
According to Henderson, he needed
financing from Chrysler Financial in 2002 and 2004 to keep his
business operating, and “had no choice but to sign the pre-printed
form contract supplied by Chrysler Financial.”
See Affidavit of
Randy Henderson (hereinafter “Henderson Aff.”) (Docket # 112) at ¶
6.
Henderson avers that he “did not have the opportunity to
negotiate the terms of the financing contracts, especially the jury
waiver clause.”
Id. at ¶ 7.
Henderson contends that he signed the
contracts because he needed the financing to continue to operate
his business and “did not have the opportunity to negotiate any
jury waiver clause.”
Id. at ¶¶ 8-9.
Webster asserts that Chrysler
Financial “dictated the terms without actual negotiations” and, as
a result, “Henderson did not knowingly and voluntarily surrender
11
his constitutional right to a jury trial.”
See Webster Memo at p.
5.
Discussion
Pursuant to FRCP Rule 39, “[w]hen a jury trial has been
demanded under Rule 38, the action must be designated on the docket
as a jury action” and “[t]he trial on all issues so demanded must
be by jury unless the court, on motion or on its own, finds that on
some or all of those issues there is no federal right to a jury
trial.”
Fed. R. Civ. P. 39(a)(2).
a
is
jury
“fundamental”
and
The Seventh Amendment right to
“its
protection
can
only
be
relinquished knowingly and intentionally.” National Equip. Rental,
Ltd. v. Hendrix, 565 F.2d 255, 258 (2d Cir. 1977).
presumption exists against jury waiver.
Parties
to
a
contract,
intentionally waive this right.
Indeed, a
Id.
however,
may
knowingly
and
See Bank of China, N.Y. Branch v.
NBM L.L.C., No. 01 CIV.0815 (DC), 2002 WL 1072235, at *1 (S.D.N.Y.
May 28, 2002)(citing Herman Miller, Inc. v. Thom Rock Realty Co.,
L.P., 46 F.3d 183, 189 (2d Cir. 1995)).
“Contract provisions
waiving the right are narrowly construed, and the requirement of
knowing, voluntary, intentional waiver is strictly applied.”
Morgan Guar. Trust Co. of N.Y. v. Crane, 36 F. Supp. 2d 602, 603
(S.D.N.Y.
1999).
“[J]ury
trial
waivers
are
common
in
loan
agreements and loan guarantees” and “are regularly enforced.” Id.
In deciding whether a jury trial waiver in a contract was knowingly
12
and voluntarily entered into, courts must consider the following
factors: “1) the negotiability of contract terms and negotiations
between
the
parties
concerning
the
waiver
provision;
2)
the
conspicuousness of the waiver provision in the contract; 3) the
relative bargaining power of the parties; and 4) the business
acumen of the party opposing the waiver.”
Scope
waivers
of
Waiver:
Chrysler
Webster
Financial
Id. at 603-04.
maintains
relies
on
that
do
not
the
contractual
govern
because
Webster’s claims for alleged wrongful conduct are “outside and
beyond any contractual relationships” it maintains with Chrysler
Financial.
See Webster Memo at pp. 2-3.
be without merit.
I find this argument to
The waivers in the contracts relied on by
Chrysler Financial do govern here, as all of Webster’s claims arise
from or relate to the administration of the loans Webster applied
for. Webster’s statutory and common law claims in Civil Action 08CV-6535 and its counterclaims in Civil Action 09-CV-6044 alleging
that Chrysler Financial engaged in racially discriminatory and
retaliatory
conduct
by
unfairly
accelerating
Webster
Chrysler
Jeep’s financial obligations all exist because of the contractual
relationships
between
the
parties
and,
as
a
result,
governed by the waivers contained in those contracts.
must
be
Jury trial
waivers in a contract are to be construed broadly to encompass both
contract claims and related tort claims where the “causes of action
would not exist were it not for the relationship between [the
13
parties],” as well as “counterclaims whether or not arising from”
the contract at issue.
16212,
2007
WL
See In Re Actrade Fin. Tech., No. 02 Civ.
1791687,
at
*1
(Bankr.
S.D.N.Y.
June
20,
2007)(“Broad waivers have been construed to include tort claims as
well as contract claims.”). Here, because plaintiffs’ claims arise
out of and relate to the administration of the loan which the
parties contracted for, it is altogether appropriate to apply the
contractual jury waiver clause.
See Price v. Cushman & Wakefield,
Inc., 808 F. Supp. 2d 670, 704-06 (S.D.N.Y. 2011)(holding that the
jury waiver applied to both plaintiff’s contractual claims and his
discrimination claims); see also Brown v. Cushman & Wakefield,
Inc., 235 F. Supp. 2d 291, 294 (S.D.N.Y. 2002)(remarking that “the
waiver
clause
was
extremely
broad
and
included
‘any
matters
whatsoever arising out of this Agreement’” and finding, as a
result, that the jury waiver “should not be construed to refer only
to breach of contract claims” but instead “applied to all of
Plaintiff’s employment claims including those arising under federal
and
state
discrimination
statutes”).
The
waivers
here
are
sufficiently broad in their scope to encompass all of the claims
asserted by Webster Chrysler Jeep and Randy Henderson as all claims
and causes of action arise from their contractual relationship.
Voluntary Waivers: Having determined that the disputes at
issue here are within the scope of the waivers, the Court next
turns to whether Webster “knowingly and intentionally” waived its
14
right to a jury trial on its claims in Case No. 08-CV-6535 and its
counterclaims in Case No. 09-CV-6044.
The evidence in the record before the Court is sufficient to
prove that Webster did in fact “knowingly and intentionally” waive
its right to a jury.
First, with respect to the negotiability of
contract terms and negotiations between the parties concerning the
waiver provision, there is no indication that the terms of the
various
agreements
were
not
negotiable.
“Simply
because
[plaintiffs] did not negotiate these provisions, and because the
form was created by [defendants], does not mean that the waiver or
other terms in the application agreement were not negotiable.” Oei
& M.J.F.M. Kools v. Citibank, N.A., 957 F. Supp. 492, 523 (S.D.N.Y.
1997)(remarking that the parties’ agreement “was not like a ticket
sold to a passenger boarding a cruise ship”).
Indeed, there is
evidence in the record Henderson did in fact negotiate certain
terms of certain agreements and made modifications to certain
agreements.
# 107.
See, e.g., Exhibits “3A” and “3B” attached to Docket
Specifically, even before Henderson was represented by
counsel, he successfully negotiated changes to provisions of the
Certificate of Authority dated March 27, 2002.
See id.
Second, with respect to the conspicuousness of the waiver
provisions in the contracts, there can be no reasonable dispute
that the jury waivers here are all quite conspicuous.
They are
set off in their own separate paragraphs, most are in all capital
15
letters and in bold print, and most are located immediately prior
to the signature lines.
It is the opinion of the Court that the
jury waivers at issue here would be nearly impossible not to
notice.
They are not “buried” in the contracts or “set deeply and
inconspicuously in the contract.” See National Equip. Rental, Ltd.
v. Hendrix, 565 F.2d at 258; see also Bear Stearns Funding, Inc. v.
Interface Grp.-Nev., Inc., No. 03 Civ. 8259(CSH), 2007 WL 3286645,
at *1 (S.D.N.Y. Nov. 7, 2007)(enforcing the jury waiver where the
waiver was “in capitalized boldface”); National Westminister Bank,
U.S.A. v. Ross, 130 B.R. 656, 667 (S.D.N.Y. 1991)(finding a jury
waiver conspicuous where it is “set off in its own paragraph less
than two inches above the signature line”); cf. Luis Acosta, Inc.
v. Citibank, N.A., 920 F. Supp. 15, 19 (D. P.R. 1996)(finding the
waiver unenforceable where it was “not boldface and is buried at
the end of the contract”).
Third, with respect to the relative bargaining power of the
parties, although there was undoubtedly a difference in bargaining
power between the sides, there was not a gross inequality in
bargaining
power
between
the
parties.
Henderson
was
not
a
financial novice and had an established relationship with Chrysler.
See, e.g., Morgan Guar. Trust Co. of N.Y. v. Crane, 36 F. Supp. 2d
at 604 (upholding a jury waiver provision even though there was a
difference in bargaining power between the parties because the
party opposing the waiver was not completely unfamiliar with either
16
the process involved, or the party with whom they were contracting,
and therefore maintained the ability to negotiate effectively); Oei
& M.J.F.M. Kools v. Citibank, N.A., 957 F. Supp. at
523 (noting
that there was not a gross inequality in bargaining power where
plaintiff was a “longtime customer” of defendant and defendant “had
an interest in accommodating him”).
Finally, with respect to the business acumen of Henderson,
Henderson was an experienced businessman with years of experience
in the automobile industry and with automobile finance, as well as
experience with sophisticated business transactions. The fact that
Henderson is experienced in business supports the enforcement of
the contractual waivers.
Substantial past business experience on
behalf of the party contesting a jury waiver is an indication that
the party knowingly and intentionally consented to the waiver. See
National Equip. Rental, Ltd. v. Hendrix, 565 F.2d at 258 (noting
that it would be unfair to uphold jury waivers in situations where
the parties who signed the contract are laymen, who cannot be
expected to understand what exactly they were agreeing to); Morgan
Guar. Trust Co. of N.Y. v. Crane, 36 F. Supp. 2d at 604 (listing
the various qualifications of the parties who were denying the
validity of
the
jury
waiver,
including
their work
tasks
and
previous business transactions, as evidence that they knowingly
agreed to the provisions); Oei & M.J.F.M. Kools v. Citibank, N.A.,
957 F. Supp. at
523 (denying plaintiff's jury demand because
17
plaintiff “was an experienced businessman” who had worked as a
product manager
for
IBM
for
several years,
and
therefore
he
knowingly and intentionally waived his right to a jury when he
signed the contract at issue); National Westminister Bank, U.S.A.
v.
Ross,
130
credentials,
B.R.
at
667
(listing
occupation,
and
past
defendant's
negotiating
education
experience
as
evidence that he voluntarily and intentionally waived his right to
a jury trial).
Based on the foregoing, the Court concludes that Webster and
Henderson knowingly and intentionally waived their right to a jury
trial. As a result, Chrysler Financial’s motion to strike the jury
demand (Docket # 107) is granted.
Conclusion
Defendants’ motion to strike the jury demand (Docket # 107) is
granted.
SO ORDERED.
______________________________
JONATHAN W. FELDMAN
United States Magistrate Judge
Dated: March 30, 2012
Rochester, New York
18
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