Fibra-Steel, Inc. v. Astoria Industries, Inc., N 88-0154 C.

• Decision Date: 21 March 1989
• Docket Number: No. N 88-0154 C.,N 88-0154 C.
• Parties: FIBRA-STEEL, INC., Plaintiff, v. ASTORIA INDUSTRIES, INC., et al., Defendants.
• Court: U.S. District Court — Eastern District of Missouri

708 F. Supp. 255

FIBRA-STEEL, INC., Plaintiff, v. ASTORIA INDUSTRIES, INC., et al., Defendants.

No. N 88-0154 C.

United States District Court, E.D. Missouri, N.D.

March 21, 1989.

Marion F. Wasinger, Wasinger, Parham, Morthland, Terrell and Wasinger, Hannibal, Mo., for plaintiff.

Andrew Rothschild, Jeffrey B. Hunt, St. Louis, Mo., Edward J. Leahy, Davenport, Evans, Hurwita & Smith, Sioux Falls, S.D., for defendants.

MEMORANDUM AND ORDER

GUNN, District Judge.

This matter is before the Court on defendants' motion to transfer venue. For the reasons set forth in more detail below, defendants' motion will be denied.

Plaintiff Fibra-Steel, Inc. ("Fibra-Steel"), an Illinois corporation with its principal place of business in Hannibal, Missouri, originally brought this breach of contract action against defendants Astoria Industries, Inc. ("Astoria") and Raven Industries, Inc. ("Raven"), both South Dakota corporations, in the Marion County, Missouri Circuit Court. Defendants removed the action to this Court and subsequently filed the motion for transfer now under submission. As the basis for removal, defendants correctly allege that this Court has diversity jurisdiction over the instant case. Complete diversity exists between the parties and the amount in controversy is more than $10,000.

The contracts allegedly breached are an asset purchase agreement and a temporary manufacturing agreement. As of April 16, 1987, Fibra-Steel conducted a business in Hannibal, Missouri consisting of the manufacture of fiberglass truck bodies and related items. On April 16, 1987, Fibra-Steel and Astoria entered into an asset purchase agreement by which Astoria agreed to purchase certain assets from Fibra-Steel. The agreement was closed, and the assets purchased were delivered to Astoria, on May 27, 1987. Astoria is a wholly-owned subsidiary of defendant Raven. Contemporaneous with the signing of the asset purchase agreement, Raven signed an agreement guaranteeing Astoria's performance under the asset purchase agreement. Fibra-Steel alleges that it has fully performed under the terms of the agreement but that neither Astoria nor Raven has paid the full amount agreed to.

The parties also entered into a Temporary Manufacturing Agreement whereby Fibra-Steel agreed to provide manufacturing services at its Hannibal location for Astoria while Astoria completed remodeling of a newly purchased manufacturing facility. Fibra-Steel contends that defendants have failed to compensate it fully for services performed under the Temporary Manufacturing Agreement.

The parties entered into a non-competition agreement as well.

All of the above-referenced agreements contained choice-of-forum clauses. These clauses provide that any litigation arising in connection with the contracts will be conducted in South Dakota, in accordance with South Dakota law. Defendants rely almost exclusively on the existence of this agreement in support of their motion to transfer venue. In opposition to the motion, plaintiff relies almost exclusively on the argument that the forum selection clause is unenforceable, either pursuant to South Dakota law or because the agreement was unjustly or fraudulently made. Fibra-Steel does also indicate that most of its witnesses are in Missouri.

In deciding a motion to transfer venue under 28 U.S.C. § 1404, the Court considers "the convenience of the parties and witnesses" and "the interest of justice." 28 U.S.C. § 1404(a). In addition to the statutory factors, the Court may also consider the availability of judicial process to compel the attendance of unwilling witnesses, the governing law, the relative ease of access to sources of proof, the possibility of delay and prejudice if transfer is granted, and practical...