Hancock v. American Tel. & Telegraph Co.

• Citation: 804 F.Supp.2d 1196
• Decision Date: 11 August 2011
• Docket Number: No. CIV–10–822–W.,CIV–10–822–W.
• Parties: Gayen HANCOCK et al., Plaintiffs, v. AMERICAN TELEPHONE AND TELEGRAPH COMPANY, INC., et al., Defendants.
• Court: U.S. District Court — Western District of Oklahoma

804 F.Supp.2d 1196

Gayen HANCOCK et al., Plaintiffs,
v.
AMERICAN TELEPHONE AND TELEGRAPH COMPANY, INC., et al., Defendants.

No. CIV–10–822–W.

United States District Court, W.D. Oklahoma.

Aug. 11, 2011.

[804 F.Supp.2d 1198]

Jason E. Robinson, Lydia J. Barrett, Richard L. Denney, Denney & Barrett, Norman, OK, Larry E. Coben, Coben & Associates, Scottsdale, AZ, Leon R. Russell, Russell & Shiver, Dallas, TX, Marcus W. Viles, Sr., Mark C. Menser, Viles and Beckman, Myers, FL, Robert M.N. Palmer, Law Offices of Palmer Oliver P.C., Springfield, MO, for Plaintiffs.

Cindy D. Hanson, James H. Walker, John P. Jett, Kilpatrick Townsend & Stockton LLP, Atlanta, GA, Curtis M. Long, Fellers Snider Blankenship Bailey & Tippens, Tulsa, OK, for Defendants.

ORDER LEE R. WEST, District Judge.

This matter comes before the Court on the Motion to Dismiss or Alternatively to Compel Arbitration and Dismiss or Transfer filed by defendant BellSouth Telecommunications, Inc. (“BellSouth”). Plaintiff James Bollinger has responded in opposition.¹ Based upon the record, including BellSouth's reply and Bollinger's sur-reply, the Court makes its determination.

In addition to the movant, Bollinger and his three co-plaintiffs, Gayen Hancock,

[804 F.Supp.2d 1199]

David Cross and Montez Mutzig, have sued twelve (12) other entities: American Telephone and Telegraph Company, Inc.,² Pacific Bell Telephone Company, Illinois Bell Telephone Company, Indiana Bell Telephone Company, Inc., Michigan Bell Telephone Company, Nevada Bell Telephone Company, The Ohio Bell Telephone Company, Wisconsin Bell, Inc., The Southern New England Telephone Company, AT & T Southeast, Inc., Southwestern Bell Telephone Company, named in the style as Southwestern Bell Telephone Company, L.P., and AT & T Operations, Inc. (“AT & T Ops”).³

The plaintiffs have sought to represent a nationwide class of consumers who purchased and/or subscribed to services designed, manufactured, marketed, advertised and sold by the various defendants under the brand name “U-verse.” See Doc. 1 at 2, ¶ 1; e.g., id. at 5, ¶ 26. The plaintiffs have complained that U-verse service, which generally includes three bundled or packaged components—television (“TV”), voice over Internet protocol (“VOIP” or “Voice”) and Internet, is “plagued by defects and deficiencies,” id. at 2, ¶ 2, and although “hyped and over-promoted as a technological advance ... [has] fail[ed] of its essential purpose....” Id. ¶ 3.

The plaintiffs have asserted claims under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961 et seq., as well as under state law for fraud, civil conspiracy, conversion, unjust enrichment, breach of the implied covenant of good faith and fair dealing and breach of contract, and they have sought monetary, equitable and declaratory relief.

Bollinger is a citizen and resident of the State of Florida. E.g., Doc. 1 at 3, ¶ 11. He has alleged that he purchased, or subscribed to, U-verse in September 2009. E.g., id. at 11, ¶ 31.⁴

Because U-verse services are provided by the subsidiary operating company according to the residence of the consumer, Bollinger, whose service and billing address is in the State of Florida, purchased or subscribed to services provided by movant BellSouth, the regional operating company for Florida. ⁵ AT & T Ops “is the entity ultimately responsible for AT & T U-verse in the area[ ] provisioned by ... BellSouth....” Declaration of Jeff Weber (October 20, 2010) at 2, ¶ 5.

The three U-verse components are governed by terms of service. The two components, TV and VOIP, are governed by a single set of terms of service; “AT & T U-verse Voice and TV General Terms of Service”

[804 F.Supp.2d 1200]

(“TV/Voice TOS”). Internet service is governed by separate terms of service: “AT & T High Speed Internet Terms of Service/att.net Terms of Use” (“Internet TOS”).

In the instant motion, BellSouth not only has challenged this Court's exercise of personal jurisdiction over it, but also, in the alternative, has moved the Court to compel arbitration of Bollinger's Internet-related claims pursuant to an arbitration agreement between the parties. BellSouth has further moved the Court to dismiss Bollinger's TV/Voice-related claims ⁶ under Rule 12(b)(3), F.R.Civ.P., or, alternatively, to transfer such claims to the United States District Court for the Western District of Texas under title 28, section 1404(a) of the United States Code.

In connection with the latter arguments, BellSouth has contended that Bollinger, the only plaintiff to whom it provided service, was required to, and did, accept the TV/Voice TOS, including its forum selection provision,⁷ before the U-verse TV and/or VOIP services were installed at his residence. The TV/Voice TOS, which was in effect at the time Bollinger purchased, or subscribed to, U-verse services and on which BellSouth has relied, reads in pertinent part:

These TOS and the relationship between you and AT & T will be governed by the laws of the State of Texas without regard to its conflict of law provisions, ⁸ and you and AT & T agree to submit to the personal and exclusive jurisdiction of the courts located within the county of Bexar County, Texas. ⁹

Doc. 56–3 at 30, ¶ 19(c).

Although forum selection clauses, like the foregoing clause, “are prima facie

[804 F.Supp.2d 1201]

valid and should be enforced ...,” The Bremen v. Zapata Off–Shore Co., 407 U.S. 1, 10, 92 S.Ct. 1907, 32 L.Ed.2d 513 (1972), the existence of such a clause neither imposes an absolute duty, nor endows an absolute right, to litigate the dispute in the named forum. Rather, a clause's applicability as well as its enforceability in a given case depends upon the clause's classification-mandatory or permissive, e.g., Excell, Inc. v. Sterling Boiler & Mechanical, Inc., 106 F.3d 318, 321 (10th Cir.1997), and upon its reasonableness. E.g., Milk ‘N’ More, Inc. v. Beavert, 963 F.2d 1342, 1344 (10th Cir.1992) (clause enforced “unless shown to be unreasonable”) (citations omitted).

“ ‘Mandatory forum selection clauses contain clear language showing that jurisdiction is appropriate only in the designated forum.’ ” K & V Scientific Co. v. Bayerische Motoren Werke Aktiengesellschaft, 314 F.3d 494, 498 (10th Cir.2002) (quoting Excell, Inc., 106 F.3d at 321). Permissive forum selection clauses, “ ‘[i]n contrast, ... authorize jurisdiction in a designated forum, but do not prohibit litigation elsewhere.’ ” Id. (quoting Excell, Inc., 106 F.3d at 321).

The Court finds that the forum selection clause set forth in the TV/Voice TOS in effect at the time Bollinger purchased, or subscribed to, U-verse services is mandatory. The first phrase of the clause, the choice of law provision, dictates that the TVA/Voice TOS and the relationship between the consumer and AT & T will be governed by Texas law. The second, and generally dispositive phrase, specifies that both the customer “and AT & T agree to submit to the personal and exclusive jurisdiction of the courts located within the county of Bexar County, Texas.” Doc. 56–3 at 30, ¶ 19(c).

Such language is unambiguous, unequivocal and obligatory. E.g., Milk ‘N’ More, 963 F.2d at 1345–46 (clause stating “Venue shall be proper ... in Johnson County, Kansas,' ” deemed mandatory). Accordingly, venue in any forum other than a “court[ ] located within the county of Bexar County, Texas,” is improper, e.g., K & V Scientific Co., 314 F.3d at 499 (circuits agree that where venue is specified with mandatory language, clause is enforced), unless Bollinger, as the party resisting enforcement of the clause, can demonstrate that its enforcement in this case would be “unfair or unreasonable.” Excell, Inc., 106 F.3d at 321 (citation omitted). See The Bremen, 407 U.S. at 10, 92 S.Ct. 1907 (forum selection clauses should be enforced unless shown by resisting party to be unreasonable).

In an attempt to do so, Bollinger has first argued that he cannot be bound by the terms of the forum selection clause because there is no “empirical and verifiable evidence that [he] ... ever accepted or agreed to the forum selection clause.” Doc. 69 at 6; e.g., Doc. 1 at 22, ¶ 77 (plaintiffs “never provided copy [of Terms of Service]”).¹⁰

David Saigh is an area manager for network process and quality in the AT & T

[804 F.Supp.2d 1202]

Network Operations business unit of AT & T Ops, and he is charged with the development of the methods and procedures used by premises technicians in the installation of U-verse services. Saigh has stated

(1) that “[w]hen a customer places an order for U-verse, it is sent to the Global Craft Access System (‘GCAS') where [p]remises [t]echnicians receive and review the order[,]” Declaration of David Saigh (October 19, 2010) at 3, ¶ 6 (“Saigh Declaration”);

(2) that “[s]tandard installation practice requires the [p]remises [t]echnician to ... provide a Welcome Kit containing the printed TV/Voice TOS to the customer for the customer's review[,]” id. ¶ 7;

(3) that “[a]ccording to standard installation procedure, the [p]remises [t]echnician provides the customer with an opportunity to review the TV/Voice TOS before the installation of U-verse services and has the customer acknowledge and agree to the TV/Voice TOS on the technician's laptop with the GCAS web application[,]” id. ¶ 8; and

(4) that “[a]cceptance of the TV/Voice TOS is required before installation proceeds.” id. ¶ 10.

Saigh has further stated that because customer acceptance of the TV/Voice TOS is required before installation of the TV and VOIP components, e.g., id. (if customer refuses to accept TV/ Voice TOS, technician cannot install U-verse services), Bollinger “would have necessarily agreed to the TV/Voice TOS....” Id. at 4, ¶ 13.

Bollinger has responded that because the premises technician performed the installation and because Saigh has admitted that “the customer acknowledge[s] and agree[s] to the TV/Voice TOS on the technician's laptop ...,” Saigh Declaration at 3, ¶ 8, there is no evidence that he...