CSX Transp., Inc. v. Blakeslee, Case No. 3:12-cv-713-J-34TEM
| Decision Date | 22 March 2013 |
| Docket Number | Case No. 3:12-cv-713-J-34TEM |
| Parties | CSX TRANSPORTATION, INC., Plaintiff, v. JASON E. BLAKESLEE, as partner for Blakeslee Premium Pellets, JENNIFER A. BLAKESLEE, as partner for Blakeslee Premium Pellets, and BLAKESLEE PREMIUM PELLETS, Defendants. |
| Court | U.S. District Court — Middle District of Florida |
THIS CAUSE is before the Court on the Report and Recommendation (Doc. 21; Report), entered by the Honorable Thomas E. Morris, United States Magistrate Judge, on November 2, 2012. In the Report, Magistrate Judge Morris recommends that the Court deny Defendants' Motion to Dismiss for Improper Venue and Forum Non Conveniens or Alternatively to Transfer or Stay (Doc. 10; Motion). On November 7, 2012, Defendants filed Defendants' Objection to Report and Recommendation as to Motion to Dismiss for Improper Venue and Forum Non Conveniens (Doc. 22; Objections), to which Plaintiff responded. See Plaitniff's Response to Defendants' Objection to Report and Recommendation as to Motion to Dismiss for Improper Venue and Forum Non Conveniens (Doc. 23; Response to Objections), filed November 21, 2012. Accordingly, this matter is ripe for review.
The Court "may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge." 28 U.S.C. § 636(b). If no specific objections to findings of facts are filed, the district court is not required to conduct a de novo review of those findings. See Garvey v. Vaughn, 993 F.2d 776, 779 n.9 (11th Cir. 1993); see also 28 U.S.C. § 636(b)(1). However, the district court must review legal conclusions de novo. See Cooper-Houston v. Southern Ry. Co., 37 F.3d 603, 604 (11th Cir. 1994); United States v. Rice, No. 2:07-mc-8-FtM-29SPC, 2007 WL 1428615, at * 1 (M.D. Fla. May 14, 2007).
Plaintiff initiated this action on June 22, 2012, by filing a three-count Complaint (Doc. 1) against Jason Blakeslee, Jennifer Blakeslee, (the Blakeslees) and Blakeslee Premium Pellets (the Partnership). See generally Complaint. On June 28, 2012, Plaintiff filed an Amended Complaint (Doc. 6) asserting claims for breach of contract against the Partnership, and the Blakeslees, as the alleged members of the Partnership. See generally Amended Complaint. According to the Amended Complaint, Plaintiff entered into a Credit Agreement, id., Ex. A, with the Partnership on June 20, 2008, whereby the Partnership agreed to pay Plaintiff to transport rail freight from various locations in the United States to the Partnership's place of business in Connecticut. Id. at 3. Plaintiff asserts that Defendants failed to make payments pursuant to the Credit Agreement. See id. Significantly, the Credit Agreement contains a forum-selection clause which states: "any lawsuit for non-payment of charges shall be litigated ONLY in state or federal courts having situs in Duval County,Florida." See id., Ex. A at 2. Accordingly, Plaintiff filed this breach of contract action in the Jacksonville Division of the United States District Court for the Middle District of Florida. See Amended Complaint at 2, 4-5.
Prior to bringing the instant lawsuit, in February 2009, Plaintiff filed a lawsuit in the United States District Court for the District of Connecticut, against the Blakeslee Group, Inc. (BGI) for the recovery of the unpaid freight charges under 49 U.S.C. § 11101 (2009 Action). See Motion, Ex. 1. After obtaining a default judgment against BGI, Plaintiff filed a lawsuit in the same court on April 6, 2011, and in its third amended complaint, asserted an action against the Blakeslees to pierce the corporate veil of BGI (2011 Action). Id., Ex. 4. On September 11, 2012, the Connecticut Court entered an order granting summary judgment in favor of the Blakeslees and against Plaintiff. See Plaintiff's Notice of Supplemental Authority in Opposition to Defendants' Motion to Dismiss Based Upon the Recent Ruling by the U.S. District Court in Connecticut (Doc. 18), Ex. A. The Clerk of the Court entered Judgment in that action on September 25, 2012, and the case is now closed.
In the instant Motion, Defendants request that the Court dismiss this case for improper venue under 28 U.S.C. § 1406(a), or transfer the action to the United States District Court for the District of Connecticut based on the principle of forum non conveniens or 28 U.S.C. § 1404(a). See Motion at 1.1 Plaintiff opposes the Motion. See Plaintiff CSX Transportation, Inc.'s Memorandum of Law in Opposition to Defendants' Motion to Dismiss or, In the Alternative, to Transfer or Stay This Matter (Doc. 15; Response), filed August 9,2012. In the Report, the Magistrate Judge finds that Defendants' request for dismissal of this action under § 1406(a) for improper venue is due to be denied. See Report at 10-11. Specifically, Magistrate Judge Morris determines that the forum-selection clause is valid and enforceable, and that Plaintiff did not waive its right to enforce the clause. Id. at 8-11. In addition, upon consideration of the interests of justice and the convenience of the parties and witnesses, Judge Morris recommends that the Court deny Defendants' request for the transfer of this case. Id. at 11-14.
In the Objections, Defendants argue that Plaintiff waived its right to enforce the forum-selection clause because Plaintiff's "substantial invocation of the litigation process in Connecticut" demonstrates an intent to abandon this right. See Objections at 1. In support, Defendants maintain that, contrary to the Magistrate Judge's finding, "the Credit Agreement and its enforcement was [sic] extensively litigated in Connecticut . . . ." Id. at 1-2. Second, Defendants contend that the Magistrate Judge failed to "properly balance the factors" under 28 U.S.C. § 1404(a). Id. at 2. Defendants assert that "the fact that Jennifer Blakeslee is not a party to the Credit Application, and the fact that CSX's initial forum choice was Connecticut, substantially outweighs enforcement of the Florida forum-selection clause." Id.
In its Response to the Objections, Plaintiff argues that the Credit Agreement and its enforcement were never litigated in the Connecticut actions. See Response to Objections at 7-9. As such, Plaintiff maintains that it has not substantially invoked the litigation process in Connecticut with respect to the Credit Agreement, and therefore, has not waived theforum-selection clause. See Response to the Objections at 5-9. In addition, Plaintiff contends that Defendants were not prejudiced with respect to this action by the litigation in Connecticut because "none of the Connecticut litigation had anything to do with the Credit Agreement." Id. at 6-7. Finally, Plaintiff asserts that the Magistrate Judge properly weighed the § 1404(a) and forum non conveniens factors such that this Court should overrule Defendants' objections, adopt the Magistrate Judge's recommendation, and deny Defendant's Motion. See id. at 9-13.
First, the Court finds that the principle of forum non conveniens is inapplicable under the circumstances of this case. "Forum non conveniens is an ancient common law doctrine that permits a court to decline jurisdiction over a case, even if personal jurisdiction and venue are otherwise proper, when there is a more convenient forum for the case to be litigated." Esfeld v. Costa Crociere, S.P.A., 289 F.3d 1300, 1302 n.4 (11th Cir. 2002). In diversity actions, district courts apply federal law governing forum non conveniens. See id. at 1315. Before 28 U.S.C. § 1404 was enacted, federal courts used the doctrine of forum non conveniens to dismiss actions that properly could have been brought in another United States District Court. See Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 512 (1947) (). However, "[s]uch a dismissal would be improper today because of the federal venue transfer statute, 28 U.S.C. § 1404(a): 'For theconvenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.'"2 Am. Dredging Co. v. Miller, 510 U.S. 443, 449 n.2 (1994) (quoting 28 U.S.C. § 1404(a)). Indeed, section 1404(a) gives district courts "'more discretion to transfer . . . than they had to dismiss on grounds of forum non conveniens.'" Id. (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 253 (1981)). Thus, "[t]he common-law doctrine of forum non conveniens 'has continuing application [in federal courts] only in cases where the alternative forum is abroad,' and perhaps in rare instances where a state or territorial court serves litigational convenience best." Sinochem Int'l Co. Ltd. v. Malaysia Int'l Shipping Corp., 549 U.S. 422, 430 (2007) (quoting Am. Dredging, 510 U.S. at 449 n.2) (alteration in Sinochem). As such, because Defendants assert that the federal court in Connecticut would provide a more convenient forum for this action, Defendants' request that this action be dismissed under the doctrine of forum non conveniens is misplaced.3
In considering whether to transfer a case pursuant to § 1404(a), the district court must engage in a two-step inquiry. See Eye Care Int'l, Inc. v. Underhill, 119 F. Supp. 2d 1313, 1318 (M.D. Fla. 2000); Mason v. Smithkline Beecham Clinical Labs., 146 F. Supp. 2d 1355, 1359 (S.D. Fla. 2001). The court must first determine, as a threshold matter, whether the case might have been filed in the proposed district, or whether all parties have consentedto suit in that district. See Bookworld Trade, Inc. v. Daughters of St. Paul, Inc., No. 8:06-CV-1746-T-27MAP, 2006 WL 3333718, at *1 (M.D. Fla. Nov. 16, 2006); see also Colo....
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