Mansell & Assocs. v. Ritchey Metals Co.

• Decision Date: 20 January 2023
• Docket Number: 3:22-cv-01169-HNJ
• Parties: MANSELL AND ASSOCIATES, LLC, Plaintiff, v. RITCHEY METALS COMPANY, INC., Defendant.
• Court: U.S. District Court — Northern District of Alabama

MANSELL AND ASSOCIATES, LLC, Plaintiff, v. RITCHEY METALS COMPANY, INC., Defendant.

No. 3:22-cv-01169-HNJ

United States District Court, N.D. Alabama, Northwestern Division

January 20, 2023

MEMORANDUM OPINION

HERMANN. JOHNSON, JR. UNITED STATES MAGISTRATE JUDGE

This diversity action proceeds before the court on Defendant Ritchey Metals Company, Inc.'s (“Ritchey), motion to dismiss for lack of personal jurisdiction, improper venue and failure to state a claim pursuant to Federal Rules of Civil Procedure 12(b)(2), 12(b)(3), and 12(b)(6) respectfully. (Doc. 11). Alternatively, Ritchey moves the court to transfer this action to the United States District Court for the Western District of Pennsylvania pursuant to 28 U.S.C. § 1404(a). (Id.). Plaintiff Mansell and Associates, LLC (“Mansell”), filed a motion pursuant to the equitable first-filed rule for the court to stay, or alternatively transfer to this court, a civil action between the parties pending in the Western District of Pennsylvania. (Doc. 15).

Review of the parties' motions and contentions result in the following conclusions: the court maintains specific personal jurisdiction over Ritchey, Mansell states a justiciable claim pursuant to the Declaratory Judgment Act, the Northern District of Alabama qualifies as a proper venue, yet, the court will dismiss this action pursuant to the court's discretion regarding declaratory judgment actions, an exception to the first-filed rule, and the § 1404(a) venue factors.

For the foregoing reasons, the court will DENY Ritchey's motions to dismiss and transfer this case. (Doc. 11). Moreover, the court will DENY Mansell's motion to stay, or alternatively, transfer the Western District of Pennsylvania case to this district. (Doc. 15). Rather, the court will DISMISS this case without prejudice.^[1]

BACKGROUND

Mansell, an Alabama limited liability company, maintains its principal place of business in Colbert County, Alabama. (Doc. 9 at ¶ 5). Ritchey, a Pennsylvania corporation, maintains its principal place of business in Pennsylvania. (Id. at ¶ 6). In August 2018, Ritchey determined it needed an aluminum-melting furnace for its main operating plant in Canonsburg, Pennsylvania. (Doc. 9-2 at 2).^[2] To obtain such a furnace, Ritchey actively solicited quotes from various manufacturers. (Id.). In particular, Ritchey solicited Mansell for a quote to provide a furnace. (Doc. 9 at ¶ 4; Doc. 9-2 at 2).

In a series of conversations, a Mansell representative highlighted both its experience in building aluminum-melting furnaces and its expertise in designing and installing such furnaces at facilities similar to Ritchey's factory. (Doc. 9-2 at 2-3). Ritchey invited the Mansell representative to conduct a diligence visit at its facility in September 2018. (Id. at 3). During the diligence visit, the Mansell representative walked the facility, took measurements, examined the area where the furnace would operate, and met with several Ritchey employees and agents. (Id.). The Mansell representative conducted a second diligence visit in Fall 2020.

At some point after the parties commenced contract negotiations for the manufacture of the furnace, two Ritchey representatives visited Mansell's facility in Alabama to inspect a furnace built for another customer. (Doc. 9 at ¶ 4). While in Alabama, one of the representatives continued contract negotiations with Mansell personnel for the manufacture, delivery, and installation of the furnace. (Id.).

Subsequently, Mansell sent Ritchey a proposal titled, “QUOTE No. 102620” (“Contract”), and dated October 26, 2022. (Doc. 9 at ¶ 7; Doc. 9-1). The Contract specified Mansell's expected performance and price. (See doc. 9-1). In addition, the Contract stated, on a page titled “ACCEPTANCE,”

These specifications are submitted for the prompt consideration of the Buyer. An authorized representative of the BUYER shall accept the same within ninety (90) days of the date of this proposal, at the proper place indicated in the lower left hand corner. It shall then be returned to Mansell and Associates for approval by M&A and upon such approval, it shall become a binding contract upon both parties hereto.

(Id. at 14). The following two pages, titled “LEGAL CONDITIONS OF SALE,” provided

The foregoing Proposal by [Mansell] . . . is EXPRESSLY MADE CONDITIONAL upon the Terms and Conditions specified below COMPRISING THE TERMS AND CONDITIONS OF SALE OF THE ULTIMATE AGREEMENT BETWEEN [Mansell] and PURCHASER. ...

The accepted proposal shall not be binding upon M&A until it is ratified at its home office by a duly authorized officer or agent of M&A, providing an Order of Acknowledgment to Purchaser.

(Id. at 14-15).

The Contract also declared that it “shall be construed under the laws of Alabama.” (Doc. 9 at ¶¶ 1,4; Doc. 9-1 at 16).

A Ritchey representative signed the Contract on November 3, 2020, and then delivered it to Mansell in Alabama (presumably via electronic means). (Doc. 9 at ¶ 4; Doc. 9-1 at 14). A Mansell representative signed the Contract that same day. (Doc. 91 at 14).

The design and manufacturer of the furnace at issue occurred in Alabama. (Doc. 9 at ¶ 4). During production, Mansell convened regular Zoom meetings, and engaged in numerous emails and telephone calls, with a Ritchey representative concerning the progress of the furnace. (Id.). On July 7, 2021, Mansell delivered the furnace to Ritchey at its designated facility in Pennsylvania. (Doc. 9-2 at 3).

Some issues arose regarding the furnace which the parties attempted to resolve. (See doc. 9-2). At Ritchey's facility, Mansell representatives “instructed and showed” Ritchey personnel in “detail” as to the proper operation and maintenance of the furnace. (Doc. 9 at ¶ 13). After the resolution efforts failed, Ritchey's legal counsel sent Mansell a demand letter on August 1, 2022, contending Mansell had breached the Contract and Ritchey had suffered damages as a result thereof. (See doc. 9-2). Ritchey's counsel requested Mansell representatives contact him prior to August 10, 2022, to discuss resolution options as a final effort to reach an amicable solution. (Id. at 9-10).^[3]The letter concluded that if Mansell “points fingers” or suggests “lame” defenses to justify its conduct, Ritchey would terminate “informal negotiations” and file a lawsuit against Mansell in the Western District of Pennsylvania. (Id. at 10).

On August 12, 2022, Mansell filed a complaint in the Circuit Court of Colbert County, Alabama, against Ritchey seeking declaratory relief. (Doc. 1 at 23-33). Ritchey removed the case to this court on September 12, 2022. (Doc. 1). On September 19, 2022, Ritchey filed a motion to dismiss Mansell's complaint and filed its own complaint in the Western District of Pennsylvania against Mansell and Ed Mansell seeking appropriate damages and declaratory relief. (Doc. 3); Complaint at 29, Ritchey Metals Company, Inc., v. Mansell and Associates, LLC, et al., 2:22-cv-01335-CCW, (Doc. 1).^[4]Ritchey avers the following counts in its complaint: breach of warranty, breach of contract, fraud in the inducement, and negligence. Complaint at 13-29, Ritchey Metals Company, Inc., v. Mansell and Associates, LLC, et al., 2:22-cv-01335-CCW, (Doc. 1). On October 4, 2022, Mansell filed an amended complaint pursuant to Federal Rule of Civil Procedure 15(a)(1)(B) seeking a declaratory judgment. (Doc. 9). As discussed previously, Ritchey filed its motion to dismiss or transfer this civil action (doc. 11), and Mansell filed a motion to stay or transfer the civil action in the Western District of Pennsylvania due to the first-filed rule (doc. 15).

DISCUSSION

I. THE COURT MAINTAINS SPECIFIC JURISDICTION OVER RITCHEY

In the initial entreaty in its motion to dismiss, Ritchey argues that “the facts alleged in [Mansell's] Amended Complaint are markedly insufficient - and indeed, conclusively demonstrate - that this Court does not possess personal jurisdiction over [it].” (Doc. 11 at 4). The following analysis reveals the court maintains specific jurisdiction over Ritchey.

The Supreme Court in Pennoyer v. Neff avowed as a matter of sovereignty that no State's judiciary “can extend its process beyond [its] territory so as to subject either persons or property to its decisions.” 95 U.S. 714, 723 (1877), overruled on other grounds by Shaffer v. Heitner, 433 U.S. 186 (1977) (citations omitted). Hence, personal jurisdiction ensures “the States through their courts, do not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292 (1980).^[5]

The Supreme Court has since professed that

[t]he requirement that a court have personal jurisdiction flows . . . from the Due Process Clause. The personal jurisdiction requirement recognizes and protects an individual liberty interest. It represents a restriction on judicial power not as a matter of sovereignty, but as a matter of individual liberty.

Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982); see also Ford Motor Co. v. Montana Eighth Jud. Dist. Ct., 141 S.Ct. 1017, 1024 (2021) (“The Fourteenth Amendment's Due Process Clause limits a state court's power to exercise jurisdiction over a defendant.”).

To be sure, “the requirement of personal jurisdiction, as applied to state courts, reflects an element of federalism and the character of state sovereignty vis-a-vis other States.” Id. at 702 n.10. Nonetheless,

[t]he restriction on state sovereign power . . . must be seen as ultimately a function of the individual liberty interest preserved by the Due Process Clause. That Clause is the only source of the personal jurisdiction requirement and the Clause itself makes no mention of federalism

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