Cobb v. Galaxy Mall, Inc.

886 So. 2d 58, 2003 Ala. LEXIS 356
CourtSupreme Court of Alabama
DecidedNovember 21, 2003
Docket1021281 and 1021308
StatusPublished
Cited by1 cases

This text of 886 So. 2d 58 (Cobb v. Galaxy Mall, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cobb v. Galaxy Mall, Inc., 886 So. 2d 58, 2003 Ala. LEXIS 356 (Ala. 2003).

Opinion

WOODALL, Justice.

Galaxy Mall, Inc., a Utah company, and MicroFinancial, Inc., and its subsidiary, Leasecomm Corporation, Massachusetts companies (the Massachusetts companies [60]*60will hereinafter be collectively referred to as “Leasecomm”), petition this Court for writs of mandamus directing the trial court to vacate its order denying their motions to enforce outbound forum-selection clauses in contracts between them and Aaron Cobb. We deny the petitions.

On August 22, 2002, Cobb filed a putative class action against Galaxy Mall and Leasecomm. The complaint contained the following pertinent factual averments:

“2. Defendant Galaxy Mall is the entity described herein [that] solicited [Cobb] and [putative] class members to establish a turnkey ‘internet business,’ and offered a purported ‘mentoring program’ for the internet business....
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“6. On or about November 9, 2000, [Cobb] and other [putative] class members were solicited by representatives of Defendant Galaxy Mall to attend a meeting at the Governor’s House Motel in Montgomery, Alabama, whereby Galaxy Mall representatives provided a presentation of its internet ‘mentoring program,’ which would help small businesses and persons make money [on] the internet by assisting these individuals in establishing a turnkey ‘internet business.’ ...
“7. Galaxy Mall was to set up a market source on the internet for the participants at the meeting. This would include the custom design of a website, listing of online shopping mall sites, marketing support, and other services and materials provided by Galaxy Mall. In Plaintiff Aaron Cobb’s case, he intended to establish an internet business which marketed and sold certain dietary products.
“8. At this meeting, participants [signed] up for the mentoring program [by executing a Galaxy Mall, Inc., order form] for a ‘tuition’ in the amount of $2,995....
“9. Defendant Galaxy Mall, in conjunction with ... Defendants Lease-comm and MicroFinaneial, induced [Cobb] and [putative] class members to purportedly ‘finance’ this tuition in the form of a lease to be paid at a rate of $137 per month for 36 months....
“10. The purported ‘tuition’ for the Galaxy Mall program was payable in the form of a non-cancelable lease agreement [the ‘Lease Agreement’] through [Leasecomm]. The Galaxy Mall representatives present at this meeting had Leasecomm [Lease Agreement] applications and agreements on hand and presented them to [Cobb] and [putative] class members as the only available method to ‘lease’ the ‘tuition’ in this manner....
“11. In truth, these Lease Agreements were not for ‘tuition,’ but rather were for the leasing of certain computer-related equipment from a third party. That is, these Lease Agreements allowed Leasecomm to purchase certain computer-related equipment from a third party and then ‘lease’ the equipment back to the participant. Upon information and belief, [Cobb’s] lease was actually for equipment or software needed to process credit cards on the internet. ... At no time were these facts disclosed to either [Cobb] or the [putative] class members.
“12. The $137 monthly payments were automatically deducted by Lease-comm from [Cobb’s] bank account....
“13. Shortly after [Cobb] and [putative] class members signed up for the purported ‘mentoring program’ and entered into a lease for what was believed to be ‘tuition’ for this program, [they] never heard from Galaxy Mall again. [Cobb] made numerous attempts to con[61]*61tact Galaxy Mall about the program and market support that Galaxy Mall was to provide, but all to no avail. Moreover, [Cobb] never received any leased ‘equipment’ from Leasecomm or any other defendant.
“14. Because of the Defendants’ scam and Galaxy Mall’s subsequent disappearance, [Cobb] and [putative] class members were stuck with non-cancela-ble Lease Agreements which Lease-comm was aggressively trying to collect on....
“15. Leasecomm made wrongful deductions from [Cobb’s] bank account for the worthless lease for ... over a year. These deductions by Leasecomm included not only the monthly $137 lease payment, but also included certain other bogus and unauthorized charges. Some of the bogus charges include, but are not limited to, a $15 ‘payment charge back fee,’ and a $5 ‘statement billing charge’ simply to send out a bill....
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“16. The entire artifice and scheme described herein was developed by the Defendants collectively in order to' induce unknowing individuals to enter into certain non-cancelable Lease Agreements for items purchased by Lease-comm and purportedly ‘leased’ back to the individual, then leaving those individuals stuck in a non-cancelable Lease Agreement for an item that is of no use to them.”

The complaint sought compensatory and punitive damages “in an amount not to exceed $74,000 per class member.” Recovery was sought on theories of (1) breach of contract, (2) fraud, (3) fraudulent suppression, (4) conspiracy, (5) theft by deception, (6) conversion, and (7) violation of statutory usury laws.

On October 29, 2002, Galaxy Mall filed a “Motion to Enforce Forum Selection Clause.” The motion was based on a clause on the reverse side of the order form provided by Galaxy Mall and signed by Cobb, which provided: “[T]he parties agree that any and all disputes arising out of this transaction ... shall be resolved in the courts of the State of Utah in the County of Utah or the United States District Court for the State of Utah.” (Emphasis added.) Specifically, the motion stated: “All of Cobb’s allegations against Galaxy Mall arise directly out of the transaction memorialized by the [order form] executed by ... Cobb.... Accordingly, the forum selection agreement entered into by the parties is due to be enforced, and this ease should be dismissed.” (Emphasis added.)

Leasecomm had filed a similar motion on September 25, 2002, based on a forum-selection clause in the lease agreement entered into between Leasecomm and Cobb; that clause provided:

“The Parties hereby ... consent and submit to the exclusive jurisdiction of the Courts of the Commonwealth of Massachusetts and expressly agree to such exclusive forum for the bringing of any suit, action or other proceeding arising out of their obligations hereunder, and expressly waive any objection to venue in any such Courts.... ”

(Some emphasis added; boldface type and some emphasis deleted.) More specifically, Leasecomm’s motion stated:

“Cobb’s lawsuit clearly arises out of the Lease.... Indeed, Cobb’s entire case is asserted to dispute any obligations under the Lease.
“13. Therefore, this Court should enforce the forum selection clause in the Lease, and dismiss this case for improper venue. Cobb should bring this case [62]*62in Massachusetts pursuant to the forum, selection clause.”

(Emphasis added.)

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Related

Ex Parte Leasecomm Corp.
886 So. 2d 58 (Supreme Court of Alabama, 2003)

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Bluebook (online)
886 So. 2d 58, 2003 Ala. LEXIS 356, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cobb-v-galaxy-mall-inc-ala-2003.