239 F.3d 385 (1st Cir. 2001), 00-1539, Silva v. Encyclopedia Britannica Inc

Docket Nº:00-1539
Citation:239 F.3d 385
Case Date:February 14, 2001
Court:United States Courts of Appeals, Court of Appeals for the First Circuit

Page 385

239 F.3d 385 (1st Cir. 2001)

HERIBERTO SILVA, Plaintiff, Appellant,



No. 00-1539

United States Court of Appeals, First Circuit

February 14, 2001

Heard November 13, 2000


[Hon. Hector M. Laffitte, U.S. District Judge]

Page 386

Osvaldo Perez-Marrero, was on brief, for appellant.

Maria I. Santos-Rivera, with whom Fiddler, Gonzalez & Rodriguez, LLP, were on brief, for appellee.

Before Torruella, Chief Judge, Lynch and Lipez, Circuit Judges.

TORRUELLA, Chief Judge.

Plaintiff-appellant Heriberto Silva brought suit in the District of Puerto Rico against his employer, Encyclopedia Britannica, Inc. and Encyclopedia Britannica U.S.A. (collectively "Britannica"), for breach of contract. The contract, which granted appellant commissions for selling products manufactured by Britannica, contained the following choice-of-law and forum-selection clause: "This agreement shall be governed and construed by the laws of the State of Illinois and all actions involving this agreement must be brought in the State of Illinois." The district court concluded that the forum-selection clause was valid, enforceable and mandatory and dismissed the suit without prejudice. For the reasons set forth below, we affirm.


The prevailing view towards contractual forum-selection clauses is that "such clauses are prima facie valid and should be enforced unless enforcement is shown by the resisting party to be 'unreasonable' under the circumstances." M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972).1 Appellant advances three arguments against enforcing the forum-selection

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clause here. First, according to Silva, Britannica waived its venue defense by failing to assert it timely and properly. Silva also contends that the forum-selection clause at issue is permissive, rather than mandatory. Finally, Silva re-asserts the grounds rejected by the district court in support of his claim that the clause is unreasonable and should not be enforced. We review a district court's dismissal based on a forum-selection clause de novo. Lambert v. Kysar, 983 F.2d 1110, 1111 (1st Cir. 1993).


Shortly after commencement of this suit, Britannica filed a motion to dismiss for lack of subject-matter jurisdiction against all plaintiffs except Silva.2 See Fed. R. Civ. P. 12(b)(1). The court granted the motion as to these plaintiffs, and discovery continued with respect to only Silva's claims. Over a year later, Britannica filed the motion to dismiss which is the subject of this appeal. Appellant argues that by failing to consolidate this defense with its initial 12(b) motion against the other plaintiffs, Britannica was barred from raising the issue later by Fed. R. Civ. P. 12(g), which reads:

A party who makes a motion under this rule may join with it any other motions herein provided for and then available to the party. If a party makes a motion under this rule but omits therefrom any defense or objection then available to the party which this rule permits to be raised by motion, the party shall not thereafter make a motion based on the defense or objection so omitted, except a motion as provided in subdivision (h)(2) hereof on any of the grounds there stated.

Silva claims that for the same reason, Britannica has waived its defense under Fed. R. Civ. P. 12(h)(1)(A), which states that "[a] defense of lack of jurisdiction over the person, improper venue, insufficiency of process, or insufficiency of service of process is waived if omitted from a motion in the circumstances described in subdivision (g)."

Appellant misconstrues the law of this Circuit, under which a motion to dismiss based upon a forum-selection clause is treated as one alleging the failure to state a claim for which relief can be granted under Fed. R. Civ. P. 12(b)(6).3

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Lambert, 983 F.2d at 1112 n.1; LFC Lessors, Inc. v. Pacific Sewer Maint. Corp., 739 F.2d 4, 7 (1st Cir. 1984); cf. Ningret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21, 34 (1st Cir. 2000) (vacating judgment focusing on forum-selection clause under Rule 12(b)(6) for reconsideration of exhaustion of tribal remedies under Rule 12(b)(1)). Consequently, in this Circuit, a motion to dismiss by reason of a forum-selection clause is covered by Rule 12(h)(2), which states that "[a] defense of failure to state a claim upon which relief can be granted . . . may be made in any pleading permitted or ordered under Rule 7(a), or by motion for judgment on the pleadings, or at the trial on the merits." Fed. R. Civ. P. 12(h)(2). This provision constitutes an exception to the consolidation requirement of Rule 12(g) and therefore a motion to dismiss on forum-selection grounds is not bound to the strict limitations of 12(h)(1).4 See Frietsch v. Refco, Inc., 56 F.3d 825, 830 (7th Cir. 1995) (observing that if the motion to dismiss were based on 12(b)(6), defendant "would escape the clutches of Rule 12(h)(1)").

Accordingly, a motion to dismiss based on a forum-selection clause may be raised at any time in the proceedings before disposition on the merits. Cf. Brown v. Trustees of Boston Univ., 891 F.2d 337, 357 (1st Cir. 1989) (holding that by waiting until after the jury reached its verdict, University had waived its Rule 12(b)(6) defense). Britannica met this requirement by filing its motion to dismiss before the completion of discovery.5 Although, as appellant points out, Britannica erroneously characterized this motion to dismiss as one based on improper venue, "we are not bound by the label below, and agree that the case should have been dismissed." LFC Lessors, Inc., 739 F.2d at 7 (citing Carr v. Learner, 547 F.2d 135, 137 (1st Cir. 1976)).


We next turn to whether the language of the forum-selection clause is permissive or mandatory. To support his contention in favor of the former, appellant cites our recent opinion in Autoridad de Energia Electrica de P.R. v. Ericsson Inc., 201 F.3d 15 (1st Cir. 2000). In that case, we evaluated a forum-selection clause which provided: "The parties agree to submit to the jurisdiction of the courts of Puerto Rico." This Court read that language as "an affirmative conferral of personal jurisdiction by consent, and not...

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