General Elec. Co. v. Siempelkamp GmbH & Co.

• Decision Date: 06 January 1993
• Docket Number: No. C2-92-311.,C2-92-311.
• Citation: 809 F. Supp. 1306
• Court: U.S. District Court — Southern District of Ohio
• Parties: GENERAL ELECTRIC COMPANY, Plaintiff, v. G. SIEMPELKAMP GmbH & CO., Defendant.

809 F. Supp. 1306

GENERAL ELECTRIC COMPANY, Plaintiff, v. G. SIEMPELKAMP GmbH & CO., Defendant.

No. C2-92-311.

United States District Court, S.D. Ohio, E.D.

January 6, 1993.

COPYRIGHT MATERIAL OMITTED

Richard Dean Wetzel, Jr. and Charles Ernest Brown, Crabbe, Brown, Jones, Potts & Schmidt, Columbus, OH, for plaintiff.

John Cooper McDonald, Schottenstein, Zox & Dunn, Columbus, OH, for defendant.

OPINION AND ORDER

GRAHAM, District Judge.

This is an action for alleged breach of contract, violations of the Uniform Commercial Code, products liability, and breach of express and implied warranties brought by plaintiff General Electric Company against G. Siempelkamp GmbH & Co., a German corporation. Plaintiff's claims arise out of the sale by defendant to plaintiff of two heavy duty presses designed for the manufacture of technical laminates. These presses were installed by defendant in plaintiff's Coshocton, Ohio facility.

On June 1, 1992, defendant moved to dismiss the complaint pursuant to Fed. R.Civ.P. 12(b)(1), (2), (5) and (6). Defendant argued that service of process was improper because plaintiff induced defendant's representatives into the jurisdiction by trickery to serve them with process. Defendant also argued that a forum selection clause contained in the contracts between the parties required that plaintiff bring its action in the court presiding over defendant's place of business in Germany.

Plaintiff filed a response to defendant's motion on August 3, 1992. Plaintiff asserted that defendant had also been served with process in Germany. Defendant did not challenge the validity of this service in its reply memorandum. Therefore, the court concludes that defendant's service of process argument is now moot.

Plaintiff also contests the validity of the forum selection clause referred to in the other branch of defendant's motion to dismiss. There is conflicting authority as to how a motion to dismiss based upon a forum selection clause should be addressed procedurally. Some courts have addressed a party's invocation of a forum selection clause as a motion to dismiss for want of subject matter jurisdiction under Fed. R.Civ.P. 12(b)(1). See AVC Nederland B. V. v. Atrium Inv. Partnership, 740 F.2d 148 (2d Cir.1984); Eastern Europe, Inc. v. Transportmaschinen Export-Import, Inc., 658 F.Supp. 612 (S.D.N.Y.1987). The Eleventh Circuit has viewed a forum selection clause as a matter of venue to be addressed under Fed.R.Civ.P. 12(b)(3). See Stewart Organization, Inc. v. Ricoh Corp., 810 F.2d 1066 (11th Cir.1987). Yet another viewpoint was expressed in LFC Lessors, Inc. v. Pacific Sewer Maintenance Corp., 739 F.2d 4 (1st Cir.1984), where the court rejected the argument that a forum selection clause presented an issue of lack of venue or subject matter jurisdiction and found that the appropriate method of invoking such a clause was by way of a motion to dismiss under Fed.R.Civ.P. 12(b)(6). Forum selection clauses have also been viewed as depriving the court of personal jurisdiction. See e.g., Andrews v. Heinold Commodities, Inc., 771 F.2d 184 (7th Cir.1985).

If the enforceability of the forum selection clause is considered an issue relating to subject matter jurisdiction under Rule 12(b)(1), then this court may consider evidentiary materials outside the pleadings and resolve factual disputes. See Ohio Nat'l Life Ins. Co. v. United States, 922 F.2d 320, 325 (6th Cir.1990). However, if the enforceability of the clause is a matter to be considered under Rule 12(b)(6), then the court, upon the submission of evidentiary materials outside the pleadings, must employ the standards applicable to a summary judgment motion under Fed.R.Civ.P. 56. Id. This court, by order filed on October 5, 1992, notified the parties that summary judgment standards would be applied in ruling on defendant's motion, and afforded the parties the opportunity to present additional evidence. No additional evidence was submitted, and the parties declined the opportunity to present oral argument. Thus, the court will review the current record and apply summary judgment standards to any factual matters regarding the contractual validity of the forum selection clause.

The procedure for granting summary judgment is found in Fed.R.Civ.P. 56(c), which provides:

The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.

The evidence must be viewed in the light most favorable to the nonmoving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). Summary judgment will not lie if the dispute about a material fact is genuine, "that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). However, summary judgment is appropriate if the opposing party fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986); see also Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

As noted by the Sixth Circuit in Interamerican Trade Corp. v. Companhia Fabricadora de Pecas, 973 F.2d 487 (6th Cir.1992), the authorities are also in conflict as to whether federal or state law applies to the enforceability of forum selection clauses where a federal court is sitting in diversity jurisdiction. In that case, the Sixth Circuit noted that Ohio courts treat forum selection clauses in a similar manner as the federal courts, and applied federal law to the case before it. Id. at 489. The enforceability of choice of forum clauses was recognized in United Standard Management Corp. v. Mahoning Valley Solar Resources, Inc., 16 Ohio App.3d 476, 16 OBR 559, 476 N.E.2d 724 (1984). Subsequently, in Barrett v. Picker International, Inc., 68 Ohio App.3d 820, 589 N.E.2d 1372 (1990), an Ohio court of appeals considered the same factors utilized under federal law in determining the validity of a choice of forum clause. Thus, it appears that Ohio law mirrors federal law in this area, and that either may be applied with the same effect.

The evidence contained in the record in the present case reveals that plaintiff submitted a purchase order for the first of two presses and finishing lines on August 26, 1987. Instead of signing the acceptance copy of the purchase order, defendant sent plaintiff an order confirmation dated August 31, 1987. This order confirmation was signed on behalf of plaintiff by A.J. Carbone, an employee of the plaintiff, at defendant's place of business in Krefeld, Germany on September 2, 1987. Mr. Carbone signed the document on page 3 and initialed each page. Paragraph I(3) of Annex No. 3 to the confirmation order contains the following language:

Terms of formal contract or of supplier's written order confirmation shall prevail. No prior agreements or representation relative to any other terms and conditions of the parties shall be binding. Any additions and modifications to the contract require supplier's written confirmation.

Paragraph X of Annex No. 3 provides:

Place of jurisdiction for all disputes arising in connection with the contract shall be at the principal place of business of the supplier. This shall also apply for claims in summary procedures on bills of exchange, promissory notes or cheques. The supplier is also entitled to file a suit at the principal place of business of the purchaser.

Paragraph X further provides that the laws of the Federal Republic of Germany shall govern any dispute arising under the agreement.

Plaintiff sent a second purchase order for the first press to defendant on October 7, 1987. Defendant, by letter dated November 16, 1987, noted the new purchase order, but indicated that as far as defendant was concerned, the only contractual basis for the performance of the contract was defendant's confirmation order dated August 31, 1987. There is no evidence that plaintiff made any reply to this letter.

Plaintiff purchased a second press and finishing line from defendant in 1988. Defendant's confirmation order of May 24, 1988 was signed on behalf of plaintiff by A.J. Carbone on May 26, 1988 at Krefeld, Germany. The second confirmation order, found in Annex No. 4, contained the same forum selection clause as that found in the first confirmation order.

Plaintiff first argues that the forum selection clause found in the order confirmations were not a part of a contract between the parties. Plaintiff alleges that A.J. Carbone did not have authority to accept the terms of the order confirmations on behalf of plaintiff. The plaintiff has produced documents indicating that Mr. Carbone did not have the authority to approve a purchase of the dollar amount involved here. However, even assuming that plaintiff's evidence creates a genuine issue of material fact in regard to Mr. Carbone's actual authority, the Ohio law cited by plaintiff indicates that agency may also be implied or apparent. In the absence of actual authority, a party will be bound by a contract if that party, by his words or conduct, has reasonably caused the other party to the contract to believe that the person assuming to act as an agent had the necessary authority to make the contract. Cascioli v. Central Mut. Ins. Co., 4 Ohio St.3d 179, 4 OBR 457, 448 N.E.2d 126 (1983); Miller v. Wick Bldg. Co., 154 Ohio St. 93, 42 O.O. 169, 93 N.E.2d 467 (1950). Apparent agency requires a showing that the principal held the agent out to the public as possessing sufficient authority to perform the particular act in...