LeóN v. Sistema Universitario Ana G. Méndez
| Decision Date | 22 December 2014 |
| Docket Number | No. 13–1198.,13–1198. |
| Citation | 775 F.3d 41 |
| Parties | Rosana CLAUDIO–DE LEÓN; Luis F. Carrasquillo–Rivera; Conjugal Partnership Carrasquillo–Claudio, Plaintiffs, Appellants, v. SISTEMA UNIVERSITARIO ANA G. MÉNDEZ; Universidad Del Este; Evelyn Ayala, in her Official and Personal Capacity; John Doe; Conjugal Partnership Doe–Ayala; Litz Príncipe, in her Official and Personal Capacity; James Doe; Conjugal Partnership Doe–Príncipe; Alberto Maldonado; José Méndez, Defendants, Appellees. |
| Court | U.S. Court of Appeals — First Circuit |
OPINION TEXT STARTS HERE
Saulo Abad Vélez–Ríos, with whom Vélez & Sepúlveda, P.S.C. was on brief, for appellants.
Edgar Hernández–Sánchez, with whom Victoria D. Pierce–King and Cancio, Nadal, Rivera & Díaz, P.S.C. were on brief, for appellee.
Before TORRUELLA and LIPEZ, Circuit Judges, GELPÍ,* District Judge.
Plaintiffs–Appellants Rosana Claudio-de León (“Claudio”), Luis F. Carrasquillo–Rivera (“Carrasquillo”), and the conjugal partnership Carrasquillo–Claudio (collectively, “Appellants”) appeal the dismissal of Claudio's Title VII pregnancy and sex discrimination claim and Appellants' supplemental state law claims due to a forum selection clause contained in the employment contracts between Claudio and the University of the East of the Ana G. Méndez University System (“SUAGM” by its Spanish acronym) which precludes adjudication in federal court. On appeal, Appellants argue that: (1) the forum selection clause was not triggered because SUAGM failed to participate in mandatory “constructive negotiations conducted in good faith between the parties”; (2) Appellees 1 waived enforcement of the forum selection clause due to their delay in raising the issue before the district court; and (3) even if the district court was correct in enforcing the forum selection clause, the dismissal should have been without prejudice. Though we disagree with Appellants and find the forum selection clause applicable and enforceable, we agree that the district court should have dismissed the case without prejudice. We therefore affirm the district court but modify the judgment to expressly permit re-filing in the appropriate forum.
On February 15, 2008, Claudio was hired by the SUAGM School of Continuing Education.The employment contract, which was for a fixed term, was extended on four separate occasions, each for approximately six months. The final two extensions—covering August 3 through December 31, 2009, and January 7 through July 31, 2010, respectively—contained the following provision:
THIRTEENTH: Any dispute which arises between the parties and which cannot be resolved or surmounted by constructive negotiations conducted in good faith between the parties shall be submitted to the jurisdiction and competence of the Court of First Instance of the Commonwealth of Puerto Rico, San Juan Part, for adjudication and resolution.
According to Claudio, beginning in August 2009 she “experienced a series of continuous actions that reveal a hostile environment of moral harassment in the employment and of marriage and pregnancy discrimination” by Ayala, her supervisor. This all stemmed, Claudio claims, from her relationship with, marriage to, and impregnation by Carrasquillo, the School's Marketing Officer. Concerned with this hostile environment, Claudio met with several SUAGM administrators: Ayala on December 11, 2009; Príncipe, the Associate Dean of the Continuing Education School, on January 14, 2010; María Socorro Díaz de Burgos (“Díaz de Burgos”), the Executive Assistant to the Chancellor, on January 15, 2010; and Mildred Y. Rivera–Cordero (“Rivera”), the System Vice–President of the Continuing Education School and the Professional Studies School, around April 2010.2 In all of these meetings, Claudio was told to “limit herself to her duties and to always greet Mrs. Ayala to teach her how professionals worked and to not assume the same attitude.” On June 3, Príncipe informed Claudio that her contract would not be renewed because Ayala “did not want her” there and because of Claudio's “low productivity.”
The next day, June 4, 2010, Claudio filed a complaint before the Equal Employment Opportunity Commission (“EEOC”) alleging pregnancy and sex discrimination. On July 16, 2010, Appellants filed suit in the Court of First Instance of the Commonwealth of Puerto Rico, Ponce Part. On October 12, 2010, the EEOC issued Claudio a Notice of Right to Sue. Appellants subsequently filed the instant action against SUAGM and numerous individuals in the district court on January 10, 2011, alleging marriage discrimination, pregnancy and gender discrimination, and retaliation under Title VII, and various state law claims.
On April 15, 2011, Appellees filed a motion to dismiss, arguing that Title VII does not provide for individual liability and that Appellants failed to exhaust their administrative remedies. On November 30, 2011, the district court agreed in part, dismissing all claims except Claudio's Title VII pregnancy and sex discrimination claim against SUAGM and Appellants' supplemental state law claims against all Appellees. Approximately two weeks later, on December 16, 2011, Appellees filed a second motion to “[d]ismiss the verified complaint without prejudice,” seeking, for the first time, to enforce the forum selection clause in the employment contracts. The district court granted this motion on May 14, 2012, but was silent as to whether the dismissal was with or without prejudice.
The district court denied Appellants' motion for reconsideration on December 26, 2012, and this timely appeal followed.
In this Circuit, “we treat a motion to dismiss based on a forum selection clause as a motion alleging the failure to state a claim for which relief can be granted under Rule 12(b)(6).” 3Rivera v. Centro Médico de Turabo, Inc., 575 F.3d 10, 15 (1st Cir.2009); see also, e.g., Silva v. Encyclopedia Britannica Inc., 239 F.3d 385, 387 (1st Cir.2001). We thus review the district court's decision de novo. Rivera, 575 F.3d at 15. In conducting this review, we, like the district court, may consider “documents the authenticity of which are not disputed by the parties,” “documents central to plaintiffs' claim,” and “documents sufficiently referred to in the complaint.” Id. (internal quotation marks omitted); see also Beddall v. State St. Bank & Trust Co., 137 F.3d 12, 17 (1st Cir.1998) (). The employment contracts containing the forum selection clause at issue fall under each of these categories.
“Under federal law, the threshold question in interpreting a forum selection clause is whether the clause at issue is permissive or mandatory.” Rivera, 575 F.3d at 17. Id. () (quoting 14D Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3803.1 (3d ed.1998)) (internal quotation marks omitted).
Here, there is no doubt that the forum selection clause contained within the employment contracts is mandatory. The clause states that disputes “ shall be submitted to the jurisdiction and competence of the Court of First Instance of the Commonwealth of Puerto Rico, San Juan Part,” and it is axiomatic that the word “shall” has a mandatory connotation. See, e.g., Jama v. Immigration & Customs Enforcement, 543 U.S. 335, 346, 125 S.Ct. 694, 160 L.Ed.2d 708 (2005) (); Rivera, 575 F.3d at 17 n. 5 (); Black's Law Dictionary 1585 (10th ed.2014) (defining “shall” to mean “[h]as a duty to; more broadly, is required to” and explaining that it is used to express “the mandatory sense that drafters typically intend”).
The next step in evaluating the applicability of a forum selection clause is ascertaining its scope. Rafael Rodríguez Barril, Inc. v. Conbraco Indus., Inc., 619 F.3d 90, 92–93 (1st Cir.2010). This is a clause-specific analysis, so “it is the language of the forum selection clause itself that determines which claims fall within its scope.” Rivera, 575 F.3d at 19. The clause at issue here covers “[a]ny dispute which arises between the parties and which cannot be resolved or surmounted by constructive negotiations conducted in good faith between the parties.” Notwithstanding Appellants' acknowledgment of the broad reach of the term “any dispute,” they argue that the phrase “which cannot be resolved or surmounted by constructive negotiations conducted in good faith” limits the reach of the clause by creating a condition precedent. According to Appellants, because the parties never engaged in constructive negotiations in good faith prior to Appellants filing suit, the mandatory forum selection clause was never triggered, and thus Appellants were free to file wherever they wanted.
We reject this reading because such an interpretation leads to absurd results. In normal cases, plaintiffs initiate lawsuits and thus ordinarily have their choice of venue. See Atl. Marine, 134 S.Ct. at 581 ...
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