J.D. Fields & Company, Inc. v. Nucor-Yamato Steel Company
Filing
31
MEMORANDUM OPINION AND ORDER granting in part 20 MOTION to Dismiss 1 Complaint for Lack of Personal Jurisdiction and Improper Venue. This action is transferred to the United States District Court for the Eastern District of Arkansas. (Signed by Judge Sim Lake) Parties notified. (aboyd)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
J.D. FIELDS
&
COMPANY, INC . ,
§
§
§
§
§
§
§
§
§
Plaintiff,
v.
NUCOR-YAMATO STEEL COMPANY,
Defendant.
CIVIL ACTION NO. H-12-1918
MEMORANDUM OPINION AND ORDER
Pending before the court is Defendant Nucor-Yamato Steel
Company's
("Nucor") Motion
to
Dismiss
for
Lack
of
Personal
Jurisdiction and Improper Venue and Memorandum in Support ("Motion
to Dismiss")
(Docket Entry No. 20) .
Without deciding Nucor's
motion to dismiss, for the reasons explained below, the court will
grant Nucorfs motion to transfer this action to the United States
District Court for the Eastern District of Arkansas.
I.
Plaintiff J.D. Fields
Backqround
&
Company, Inc. ("Fields"), a Texas
corporation with its principal place of business in Houston, Texas,
is a supplier of structural steel products known as H-pilings.'
Defendant Nucor, a limited partnership with its principal place of
'complaint, Docket Entry No. 1, pp. 2-3,
¶¶
4, 8.
business in Blytheville, Arkansas, is a manufacturer of H-pilings.
In May of 2005 Fields and Nucor entered into a supply agreement
(the "Agreement") in which Fields agreed to purchase from Nucor all
of Fields' requirements for H-pilings for seven years.3
Agreement the parties agreed to the following:
In the
"Except as other-
wise specifically set forth in this Agreement, the purchase and
sale of Products by [Fields] from [Nucor] is subject to the terms
and conditions of sale which appear on Exhibit 2, attached hereto
and incorporated herein by referenceaH4 Exhibit 2 provides:
This agreement shall be governed by the laws of Arkansas.
[Fields], acting for itself and its successors and
assigns, hereby expressly and irrevocably consents to the
exclusive jurisdiction of the state and federal courts of
Arkansas for any litigation which may arise out of or be
related to this agreement.5
The Agreement also contained a choice of law clause separate from
the terms and conditions of sale:
"This Agreement shall be
governed by the laws of the State of Arkansas without regard to its
choice of law
provision^."^
4~ucor-~amato
Steel Company Supply Agreement ("Agreement"),
Ex. A to Motion to Dismiss, Docket Entry No. 20-2, ¶ 4.
'~xhibit 2 - Terms and Conditions of Sale, attached to
Agreement, Ex. A to Motion to Dismiss, Docket Entry No. 20-2,
p. 12, ¶ 12.
6~greement,
Ex. A to Motion to Dismiss, Docket Entry No. 20-2,
a i n
Based on a prior course of dealing with Nucor, Fields alleges
that it relied on reasonable assurances from Nucor that Fields
would receive pricing equal to that which Nucor offered other
purchasers in the relevant market.7
Fields further alleges that
Nucor engaged in a pattern of providing preferential pricing to
Skyline
Steel, L.L.C.
relevant
market,
("Skyline"), another
thereby
placing
Fields
purchaser
at
a
in
the
competitive
disadvantage.
Fields filed suit against Nucor in this court on June 26,
2012, bringing claims for violations of the Robinson-Patman Act, 15
U.S.C. 5 13,' tortious interference with contract,1° conspiracy,11
fraudulent misrepresentation,12 negligent misrepresentation,13 and
breach of contract.14 On August 20, 2012, Nucor filed the pending
Motion to Dismiss, urging the court to dismiss the action pursuant
either to Federal Rule of Civil Procedure 12 (b)(2) for lack of
personal jurisdiction over Nucor or Rule 12(b) (3) for improper
Complaint, Docket Entry No. 1, pp. 3-4,
7
at 4-5,
¶¶
14-15.
' d at 7-8,
I.
¶¶
25-29.
8~
at 8,
llld. at 8-9,
1
13=
2
30-32.
¶¶
at ~ 9-12,
at 12,
33-36.
¶¶
¶¶
¶¶
141d. at 12-13,
-
37-46.
47-49.
¶¶
50-54.
¶
12.
venue.l5
In the alternative, Nucor argues that the action should
be transferred to the United States District Court for the Eastern
District of Arkansas.
Fields filed a response on September 24,
2012, arguing that the court may exercise personal jurisdiction
over Nucor and that venue is proper.
Nucor filed a reply in
support of the Motion to Dismiss on October 5, 2012.17
11.
Motion to Transfer
The parties dispute whether Nucor is subject to this court's
personal jurisdiction and whether this court is a proper venue.
Although Fields has presented arguments as to the propriety of both
personal jurisdiction and venue, the court concludes that transfer
to the Eastern District of Arkansas is the most appropriate remedy.
A.
Applicable Law
Section 1404 allows district courts to transfer an action to
another
venue
"where
it
might
have
been
brought"
"for
the
convenience of parties and witnesses" if such a transfer will be
"in
the
interest
of
justice."
28
U.S.C.
§
1404(a).
The
l5~otion Dismiss, Docket Entry No. 20, pp. 1-2.
to
16plaintif
f's Response to Defendant's Motion to Dismiss for
Lack of Personal Jurisdiction and Improper Venue and Memorandum in
Support ("Plaintiff's Response") , Docket Entry No. 25, pp. 2-4,
¶ ¶ 1-5.
17Defendant's Reply Memorandum in Support of Motion to Dismiss
for Lack of Personal Jurisdiction and Improper Venue ("Defendant's
Reply"), Docket Entry No. 28.
preliminary question under
§
1404 (a) is thus whether a civil action
Whether a venue is
might have been brought in the proposed venue.
proper is determined under 28 U.S.C. 5
restrictive venue statute applies.
1391 when no special,
See 28 U.S.C.
("Except as otherwise provided by law
. . .
§
1391 (a)(1)
this section shall
govern the venue of all civil actions brought in district courts of
the United States
. . . .) .
If venue in the proposed district
would have been proper, the court must then determine "whether a
§
1404(a) venue transfer is for the convenience of parties and
witnesses and in the interest of justice."
In re Volkswasen of
America, Inc., 545 F.3d 304, 315 (5th Cir. 2008).
The Fifth
Circuit has observed that because a plaintiff's choice of forum
should bear some weight in a transfer analysis, the movant must
show "good cause" in order to obtain a transfer.
Humble Oil
&
Ref.
Co. v. Bell Marine Serv., Inc., 321 F.2d 53, 56 (5th Cir. 1963).
To show "good cause" the movant must show that the desired venue is
"clearly more convenient" than the venue chosen by the plaintiff:
[Wlhen the transferee venue is not clearly more
convenient than the venue chosen by the plaintiff, the
plaintiff's choice should be respected. When the movant
demonstrates that the transferee venue is clearly more
convenient, however, it has shown good cause and the
district court should therefore grant the transfer.
In re Volkswagen, 545 F.3d at 315.
The Fifth Circuit has provided a set of non-exhaustive private
and public interest factors, none of which are given dispositive
weight, for courts to use in determining whether a given venue is
"clearly more convenient" than another.
factors are:
I . The private interest
d
(1) the relative ease of access to sources of proof;
(2) the availability of compulsory process to secure the attendance
of witnesses; (3) the cost of attendance for willing witnesses; and
(4) all other practical problems that make trial of a case easy,
expeditious, and inexpensive.
are:
The public interest factors
(1) the administrative difficulties flowing from court
congestion; (2) the local interest in having localized interests
decided at home; (3) the familiarity of the forum with the law that
will govern the case; and (4) the avoidance of unnecessary problems
of conflict of laws and of the application of foreign law.
I . If
d
a forum selection clause exists, it "will be a significant factor
that figures centrally in the district court's calculus."
Stewart
Orsanization, Inc. v. Ricoh Corp., 108 S. Ct. 2239, 2244 (1988).
B.
Analysis
1.
Whether Venue
Arkansas
is Proper in the Eastern District of
The preliminary question in considering Nucorf s transfer
motion is whether the action could properly have been brought in
the Eastern District of Arkansas under 28 U.S.C.
§
1391.
Section
1391 provides that a civil action may be brought in "a judicial
district in which any defendant resides."
28 U.S .C.
§
1391 ( b ) (1).
For purposes of venue, "an entity with the capacity to sue and be
sued in its common name under applicable law
. . .
shall be deemed
to reside, if a defendant, in any judicial district in which such
defendant is subject to the court's
personal jurisdiction with
respect to the civil action in question."
28 U.S.C.
§
1391(c)(2).
Nucor is a limited partnership with the capacity to sue and be sued
under its common name, and is subject to personal jurisdiction
where it maintains its principal place of business in Arkansas.
The court is therefore satisfied that this action could properly
have been brought in the Eastern District of Arkansas under 28
U.S.C. 5 1391.
2.
Private Interest Factors
As the moving party, Nucor must show that the Eastern District
of Arkansas is "clearly more convenient" than the Southern District
of Texas.
The private interest factors that courts consider
regarding the convenience of parties and witnesses are:
(1) the
relative ease of access to sources of proof; (2) the availability
of compulsory process to secure the attendance of witnesses;
(3) the cost of attendance for willing witnesses; and (4) all other
practical problems that make trial of a case easy, expeditious, and
inexpensive. Nucor has submitted a declaration from its Controller
stating that the pertinent documents concerning Nucor's
sales of
H-pilings to Fields, Skyline, and other customers are located at
its
principal
place
of
business
in
Blytheville,
Arkansas.18
Furthermore, the Nucor and Skyline employees who have knowledge
18~eclarationof Keith Prevost, Ex. 1 to Motion to Dismiss,
Docket Entry No. 20-2, ¶ 13.
about the facts underlying this dispute are located in Arkansas.lg
Finally, Nucor argues that there are no potential trial witnesses
located in the Southern District of Texas other than Fieldsf own
officers and employees.2 0
Fields has not provided any evidence
relating to the private interest factors.
The court therefore
concludes that the private interest factors support transfer.
3.
Public Interest Factors
The relative convenience of the proposed transferee venue also
depends on public interest factors. Courts consider the following
public interest factors in determining whether to grant a venue
transfer:
(1) the administrative difficulties flowing from court
congestion; (2) the local interest in having localized interests
decided at home; (3) the familiarity of the forum with the law that
will govern the case; and (4) the avoidance of unnecessary problems
of conflict of laws and of the application of foreign law.
The
first two factors appear to be neutral because there is no apparent
problem with court congestion in either district and both districts
reasonably possess a localized interest in the dispute.
district court in Arkansas is undoubtedly more
But the
familiar with
Arkansas law, which will apply to this case pursuant to the
partiesr agreed choice of law provision.
Similarly, an Arkansas
lg~otion Dismiss, Docket Entry No. 20, p. 18.
to
forum will more easily avoid unnecessary problems of conflict of
laws.
Fields has not provided evidence regarding the public
interest factors.
The court thus concludes that because both the
public and private
interest factors support transfer of this
action, Nucor has shown that the Eastern District of Arkansas is
"clearly more convenient."
4.
Forum Selection Clause
The
existence
of
a
forum
selection
clause
"significant factor" in the transfer analysis.
S. Ct.
at
2244.
The Agreement
is
also
a
See Stewart, 108
incorporated the
terms and
conditions of sale from Exhibit 2, which included a forum selection
clause.
Under Arkansas law, "[wlhen a contract refers to another
writing and makes the terms of that writing a part of the contract,
the two documents become a single agreement between the parties and
must be construed together."
Insersoll-Rand Co. v. El Dorado
Chemical Co., 283 S.W.3d 191, 196 (Ark. 2008) . The forum selection
clause was thus part of a single agreement between the parties.
Moreover, the language in the forum selection clause renders
Arkansas the exclusive venue for any litigation arising out of the
agreement.
See City of New Orleans v. Municipal Administrative
Servs., Inc., 376 F.3d 501, 504 ("For a forum selection clause to
be exclusive, it must go beyond establishing that a particular
forum will have jurisdiction and must clearly demonstrate the
parties' intent to make that jurisdiction exclusive." )
.
Therefore,
the court concludes that the existence of the forum selection
clause also supports transfer to the Eastern District of Arkansas.
C.
T r a n s f e r U n d e r § 1406
Even if Nucor is not subject to personal jurisdiction or if
venue is not proper in this district, transfer -- not dismissal -would be most appropriate under 28 U.S.C. 5 1406.
Section 1406
provides that " [tlhe district court of a district in which is filed
a case laying venue in the wrong division or district shall
dismiss, or if it be in the interest of justice, transfer such case
to any district or division in which it could have been brought."
If venue
is
improper in
this
concludes that transfer under
of justice.
lacked
Similarly,
personal
§
district,
the
court therefore
1406 is appropriate in the interest
§
1406 would be triggered if the court
jurisdiction
United States, 380 F.2d 813
over
Nucor.
(5th Cir. 1967)
See
Dubin
v.
(holding that if
personal jurisdiction cannot be obtained in a venue, that venue is
thus the "wrong division or district").
Personal jurisdiction is
not required for the court to transfer a case to another federal
court.
("Nothing in
Goldlawr, Inc. v. Heiman, 82 S. Ct. 913, 915 (1962)
[§
14061 indicates that the operation of the section
was intended to be limited to actions in which the transferring
court has personal jurisdiction over the defendants. And we cannot
agree that such a restrictive interpretation can be supported by
its legislative history
. . . . .
-10-
If Nucor is not subject to
personal jurisdiction in this district, the court thus concludes
that transfer under
§
1406 is appropriate in the interest of
justice.
111.
Conclusion and Order
Considering the relevant private and public interest factors
and the forum selection clause, the court concludes that transfer
under 28 U.S.C.
§
1404 to the Eastern District of Arkansas is
appropriate. Furthermore, the court concludes that transfer under
28 U.S.C.
§
1406 would also be appropriate if Nucor is not subject
to personal jurisdiction or if venue is improper in this district.
Because the court is granting Nucor's
motion to transfer,
Nucor's motion to dismiss for lack of personal jurisdiction and for
improper venue is MOOT. Accordingly, Nucor's Motion to Dismiss for
Lack of Personal Jurisdiction and Improper Venue
(Docket Entry
No. 20) is GRANTED IN PART, and this action is TRANSFERRED to the
United States District Court for the Eastern District of Arkansas.
SIGNED at Houston, Texas, on this 4th day of December, 2012.
1
SIM LAKE
UNITED STATES DISTRICT JUDGE
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