OTTO et al v. ERIE INSURANCE EXCHANGE

Filing 20

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE ANITA B. BRODY ON 3/27/2014. 3/31/2014 ENTERED AND COPIES VIA ECF.(mo, )

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF PENNSYLVANIA
STEVE OTTO, et al.,
Plaintiffs,
v.
ERIE INSURANCE EXCHANGE,
Defendant.

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CIVIL ACTION
NO. 13-6722

March _27_, 2014

Anita B. Brody, J.
MEMORANDUM

Plaintiffs Steve and Marla Otto bring suit against Defendant Erie Insurance Exchange
(“Erie”) for underinsured motorist (UIM) benefits pursuant to the terms of their Erie Insurance
Exchange Family Auto Policy. I exercise diversity jurisdiction over this matter pursuant to 28
U.S.C. § 1332. Currently before me is Erie’s motion to dismiss pursuant to the doctrine of forum
non conveniens. For the reasons set forth below, I will deny Erie’s motion to dismiss.
I. BACKGROUND
Plaintiffs Steve and Marla Otto purchased automobile insurance from Defendant Erie.
Their insurance policy included UIM coverage. On November 12, 2012, Steve Otto was in a car
collision with an underinsured motorist. After the accident, the Ottos filed a claim with Erie to
collect UIM benefits. Erie refused to provide these benefits to the Ottos.
The Ottos filed suit in this Court to recover UIM benefits. The Otto’s
Uninsured/Underinsured Motorist Coverage Endorsement (“UIM Endorsement”) contains a
forum selection clause that mandates: “Suit must be brought in a court of competent jurisdiction
in the county and state of [the Ottos’] legal domicile at the time of the accident.” Def.’s Mot.
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Ex. 2. At the time of the accident, the Ottos were domiciled in Montgomery County,
Pennsylvania.
II. DISCUSSION
Erie argues that this action should be dismissed pursuant to the doctrine of forum non
conveniens because the forum selection clause in the UIM Endorsement mandates that the
parties bring suit in the Court of Common Pleas of Montgomery County. The Ottos contend that
the forum selection clause allows for suit in this Court.
“[T]he appropriate way to enforce a forum-selection clause pointing to a state or foreign
forum is through the doctrine of forum non conveniens.” Atl. Marine Const. Co., Inc. v. U.S.
Dist. Court for W. Dist. of Texas, 134 S. Ct. 568, 580 (2013). In deciding whether to dismiss a
case under the doctrine of forum non conveniens, “a valid-forum selection clause should be
given controlling weight in all but the most exceptional cases.” Id. at 581 (internal quotation
marks omitted). Thus, it is proper to dismiss this case under the doctrine of forum non
conveniens if the forum selection clause in this case mandates suit in the Court of Common Pleas
of Montgomery County.
“The question of the scope of a forum selection clause is one of contract interpretation.”
John Wyeth & Brother Ltd. V. Cigna Int’l Corp., 119 F.3d 1070, 1073 (3d Cir. 1997). Like any
other contract provision, the first step in interpreting a forum selection clause is to determine
whether the clause unambiguously states the parties’ intentions. Id. at 1074. “To be
‘unambiguous,’ a contract clause must be reasonably capable of only one construction.” Id.
The forum selection clause provides: “Suit must be brought in a court of competent
jurisdiction in the county and state of [the Ottos’] legal domicile at the time of the accident.”

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Def.’s Mot. Ex. 2. Erie argues that this phrase means the parties may only bring suit in a state
court located in Montgomery County. In contrast, the Ottos argue that the plain language of the
clause permits suit in any court of the county, including the United States District Court for the
Eastern District of Pennsylvania.
In Jumara v. State Farm Insurance Company, the Third Circuit addressed a forum
selection clause that permitted applications for appointment of arbitrators to be made in “a court
of record in the county.” 55 F.3d 873, 881 (internal quotation marks omitted). Although the
district court had interpreted this phrase to limit the forum to the Court of Common Pleas of
Luzerne County, the Third Circuit held that “the phrase ‘a court of record in the county’ includes
the United States District Court for the Middle District of Pennsylvania, the federal district that
encompasses Luzerne County.” Id. Similarly, in Epps v. 1.I.L., Inc., the court addressed a forum
selection clause that permitted disputes to “only be brought in a court of competent jurisdiction
located in Wayne County Pennsylvania.” No. 07-2314, 2007 WL 4463588, at *3 (E.D. Pa. Dec.
19, 2007) (internal quotation marks omitted). In consonance with Jumara, the court held that
“[t]he provision’s plain language is construed to permit the action in any court of the county,
including the federal court in the federal judicial district encompassing Wayne County,
Pennsylvania, regardless of whether the federal court is physically located in the county.” Id.
(citing Jumara, 55 F.3d at 881).
The forum selection clause at issue allows the parties to bring suit in any “court of
competent jurisdiction in the county . . . .” Def.’s Mot. Ex. 2. The United States District Court
for the Eastern District of Pennsylvania is a court of competent jurisdiction that encompasses
Montgomery County. See Jumara, 55 F.3d at 881. The unambiguous language of the clause
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permits the parties to bring suit in this Court. I will not dismiss this case pursuant to the doctrine
of forum non conveniens because the Otto’s decision to file suit in this Court complies with the
forum selection clause.
III. CONCLUSION
For the reasons set forth above, I will deny Erie’s motion to dismiss pursuant to the
doctrine of forum non conveniens.

s/Anita B. Brody
_______________________
ANITA B. BRODY, J.

Copies VIA ECF on _________ to:

Copies MAILED on _______ to:

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