Microfibres, Inc. v. McDevitt-Askew, Civ.A. No. 98-026-L.

• Decision Date: 01 September 1998
• Docket Number: Civ.A. No. 98-026-L.
• Citation: 20 F.Supp.2d 316
• Parties: MICROFIBRES, INC., Plaintiff, v. Michelle McDEVITT-ASKEW, Defendant.
• Court: U.S. District Court — District of Rhode Island

Page 316

20 F.Supp.2d 316

MICROFIBRES, INC., Plaintiff, v. Michelle McDEVITT-ASKEW, Defendant.

Civ.A. No. 98-026-L.

United States District Court, D. Rhode Island.

September 1, 1998.

COPYRIGHT MATERIAL OMITTED

William R. Grimm, Mark Bianchi, Hinckley, Allen & Snyder, Providence, RI, for plaintiff.

Vincent F. Ragosta, Jr., Matthew Oliverio, Providence, RI, for defendant.

DECISION AND ORDER

LAGUEUX, Chief Judge.

Plaintiff, Microfibres, Inc., a Rhode Island corporation with manufacturing facilities in North Carolina, ("plaintiff" or "Microfibres") brought this action in the Rhode Island Superior Court sitting in Providence County against defendant Michelle McDevitt-Askew ("defendant" or "McDevitt-Askew"). The complaint alleges that McDevitt-Askew, after leaving the employ of Microfibres, violated the terms of the noncompete agreement which she signed as part of her employment contract, by working for a competitor, Culp, Inc., a North Carolina corporation, ("Culp"). McDevitt-Askew claims her new employment does not violate the noncompete agreement.

On January 8, 1998, the Rhode Island Superior Court granted Microfibres' motion for a temporary restraining order against McDevitt-Askew. Pursuant to the order, McDevitt-Askew is restrained from working for Culp, or any other flock industry competitor of Microfibres as restricted by the noncompete agreement with Microfibres. McDevitt-Askew is also restrained from disclosing or using any of Microfibres' confidential and proprietary information in violation of the confidentiality agreement entered into with Microfibres.

On January 20, 1998, McDevitt-Askew removed the matter to this Court. The matter is presently before the Court on defendant's motion to dismiss the complaint, pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(3) for lack of personal jurisdiction and improper venue and pursuant to the doctrine of forum non conveniens or, in the alternative, to transfer this action to the United States District Court for the Middle District of North Carolina, Greensboro Division pursuant to 28 U.S.C. § 1404(a) (1994).

I. Background

Microfibres is a Rhode Island corporation with its headquarters located in Pawtucket, Rhode Island. In addition to the Rhode Island office, plaintiff has manufacturing facilities in North Carolina and Georgia. Microfibres manufactures, among other things, flocked specialty products and upholstery material including flock, flocked adhesives, and flocked fabrics. Microfibres has two divisions — the Upholstery Fabrics Division and the Specialty Products Division. Specialty products include any product manufactured and sold by Microfibres that is not used for upholstery. Microfibres employs a particular method of manufacturing flocked fabric to which other manufacturers do not have access. Microfibres considers its manufacturing technique to be a secret and believes that this gives it a competitive advantage in the marketplace.

On January 5, 1995, McDevitt-Askew was hired by Microfibres as a flocked upholstery designer at its facility in Winston-Salem, North Carolina. In 1996 McDevitt-Askew's design responsibilities were divided between the Upholstery Fabrics and the Specialty Products Divisions. Prior to working for Microfibres, McDevitt-Askew had worked for Culp in North Carolina in its mattress ticking division. Before McDevitt-Askew was given an official employment offer from Microfibres, she was interviewed by at least three of its employees. Albert Bolton met with McDevitt-Askew on December 21, 1994. He claims that at that time he verbally outlined the terms of an employment offer including compensation and the requirement that she sign a secrecy and confidentiality agreement as well as a noncompete agreement (collectively, the "Agreement"). On January 4, 1995, Bolton prepared an official offer of employment which he sent to McDevitt-Askew. The letter sent by Bolton included the terms discussed at the December 21 meeting. This letter specifically noted that McDevitt-Askew would have 30 days to sign a two-year noncompete agreement as part of the employment contract.

On January 5, 1995, McDevitt-Askew reported for work at Microfibres and was presented with the Agreement by Janice Volger, the Director of Human Resources. McDevitt-Askew claims that she felt pressure to quickly review the many documents given to her and to sign them immediately. She further alleges that she did not feel she was in any position to negotiate the terms of the Agreement or to consult a lawyer. However, she never requested more time to examine the Agreement or to consult a lawyer nor was she specifically told she had to sign the papers at that moment.

Among the provisions contained in the Agreement were a forum selection clause and a choice of law provision. The relevant clause states:

This Agreement shall be governed by and construed in accordance with the laws of Rhode Island. If suit is brought at any time based on any controversy or claim arising out of, or relating to this Agreement, I hereby submit to the jurisdiction and venue of any court sitting in the State of Rhode Island.

During her employment at Microfibres, defendant's contacts with Rhode Island consisted of approximately three visits. Defendant also communicated with Microfibres headquarters in Rhode Island by an indeterminate, although small, number of phone calls and written correspondences. Although defendant did have some need to communicate with Microfibres' Rhode Island headquarters, her primary job responsibilities and her direct supervisor were in North Carolina.

In November, 1997, McDevitt-Askew resigned from Microfibres. When leaving, she was reminded of her obligations under the secrecy and noncompete provisions of the Agreement. McDevitt-Askew then accepted a position as a mattress ticking designer at the Culp Home Furnishings business unit.

In December, 1997, Microfibres informed McDevitt-Askew and Culp that Culp was a competitor of Microfibres and as such, McDevitt-Askew's employment there was in violation of the Agreement with Microfibres. As previously indicated, on January 8, 1998, the Rhode Island Superior Court issued a temporary restraining order preventing McDevitt-Askew from working at Culp.

After removing this action to this Court, McDevitt-Askew moved for dismissal, or, in the alternative, to transfer this case to the U.S. District for the Middle District of North Carolina in accordance with 28 U.S.C. § 1404(a). Plaintiff has objected to these motions and both parties filed briefs. After hearing oral arguments the Court took the motions under advisement. These matters are now in order for decision.

II. Standard for Decision

The First Circuit has set forth the standard for ruling on motions to dismiss for want of personal jurisdiction. "The standard for deciding such motions is commonly referred to as the `prima facie' standard." Boit v. Gar-Tec Products, Inc., 967 F.2d 671, 675 (1st Cir.1992). This requires the district court to consider only whether the plaintiff has proffered evidence that, if credited, is enough to support findings of all facts essential to personal jurisdiction. Id. at 675. "To meet its burden, the plaintiff must establish sufficient facts to support a prima facie case authorizing personal jurisdiction over the defendant under both the forum's long-arm statute and the due process clause of the Constitution." U.S.S. Yachts, Inc. v. Ocean Yachts, Inc., 894 F.2d 9, 11 (1st Cir.1990), citing American Express International, Inc. v. Mendez-Capellan, 889 F.2d 1175, 1179 (1st Cir.1989).

"In determining whether a prima facie showing has been made, the district court is not acting as a fact finder. It accepts properly supported proffers of evidence by a plaintiff as true." Boit, 967 F.2d at 675. However, plaintiff may not merely rely on its pleadings; it must make its case based on facts set forth in the record. See Kowalski v. Doherty, Wallace, Pillsbury & Murphy, Attorneys at Law, 787 F.2d 7, 9 (1st Cir. 1986), citing Chlebda v. H.E. Fortna and Brother, Inc., 609 F.2d 1022, 1024 (1st Cir. 1979).

III. Discussion

Defendant asserts two arguments in support of dismissal. The first is that this Court has no personal jurisdiction over her. The second is that Rhode Island is an improper or inconvenient venue. As an alternative to dismissal, defendant seeks transfer of this case to North Carolina pursuant to 28 U.S.C. § 1404(a).

A. Personal Jurisdiction

Personal jurisdiction implicates the power a court has over a defendant. Foster-Miller, Inc. v. Babcock & Wilcox Canada, 46 F.3d 138, 143 (1st Cir.1995). In Levinger v. Matthew Stuart & Co., Inc., 676 F.Supp. 437 (D.R.I.1988), this Court observed that:

Whether a federal court has personal jurisdiction over a defendant depends upon two criteria: (1) whether the mandates of the forum state's long-arm statute have been satisfied, and (2) whether the defendant has been hailed into the particular court in accordance with the due process clause of the Fourteenth Amendment to the United States Constitution.

Id. at 439. As in Levinger, here it is only necessary to look to the second criterion "[s]ince the Supreme Court of Rhode Island has held that Rhode Island's long-arm statute reaches to the full extent of the Fourteenth Amendment." Id. citing Conn v. ITT Aetna Finance Co., 105 R.I. 397, 252 A.2d 184, 186 (R.I.1969).

Under the Fourteenth Amendment, a court may obtain personal jurisdiction over a defendant through general jurisdiction, specific jurisdiction, personal service upon defendant within the forum state, through specific consent, or through waiver by the defendant.

1. General Jurisdiction

General jurisdiction is obtained when a defendant engages in activities that are so substantial and of such a nature that they will justify a lawsuit against her on causes of action distinct from those activities. See International Shoe Co. v. State of Washington Office of Unemployment...