Mindy Slater v. Energy Services Group

• Court: Court of Appeals for the Eleventh Circuit
• Decided: March 8, 2011
• Docket: 09-13794
• Status: Published

Opinion

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT FILED ________________________ U.S. COURT OF APPEALS ELEVENTH CIRCUIT MARCH 8, 2011 No. 09-13794 JOHN LEY ________________________ CLERK

D. C. Docket No. 09-00208-CV-SCB-EAJ

MINDY SLATER,

Plaintiff-Appellant,

versus

ENERGY SERVICES GROUP INTERNATIONAL INCORPORATED, a.k.a. ESG International, Inc.,

Defendant-Appellee,

PROGRESS ENERGY SERVICE COMPANY, LLC., A subsidiary of Progress Energy, Inc., et al.,

Defendants.

________________________

Appeal from the United States District Court for the Middle District of Florida ________________________

(March 8, 2011)

Before DUBINA, Chief Judge, MARTIN and HILL, Circuit Judges. DUBINA, Chief Judge:

Appellant Mindy Slater appeals from the dismissal of her claims brought

pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq.

(Title VII), the Florida Civil Rights Act of 1992, Fla. Stat. § 760.01, et seq.

(FCRA), and the Florida Whistleblower Act, Fla. Stat. § 448.102 (FWA), against

Energy Services Group International (ESGI), her former employer. Slater claims

that the district court erred by dismissing her claims for improper venue based on a

forum-selection clause found in her employment agreement. She contends the

clause is not mandatory, does not apply to her claims, or, alternatively, should not

be enforced for public policy reasons. She also contends that the district court

erred in dismissing her claims pursuant to Federal Rule of Civil Procedure

12(b)(3) rather than analyzing ESGI’s venue objections under 28 U.S.C. §

1404(a), the federal transfer-of-venue statute. After a careful review of the record

and having the benefit of oral argument, we affirm the district court’s judgment of

dismissal.

I.

On May 14, 2006, Slater signed an employment agreement with ESGI,

which set the terms and conditions of her employment. The agreement stated that

Slater was an at-will employee and included the following forum-selection clause:

2 “The parties agree that all claims or causes of action relating to or arising from this

Agreement shall be brought in a court in the City of Richmond, Virginia.” The

agreement also included a choice of law provision designating Virginia law as

controlling and stated that the agreement “constitutes the sole and entire

agreement” between Slater and ESGI.

Shortly after hiring Slater, in July 2006, ESGI staffed Slater at Progress

Energy Service Company’s nuclear plant facility in Crystal River, Florida, where

she worked as a receptionist and later as a healthcare technician. At all relevant

times, ESGI, Progress Energy, and Florida Power Corporation jointly employed

Slater.1 In late January 2007, several months after beginning her position at the

Progress Energy plant, Slater informed her immediate supervisor that she was

pregnant. Around this time, the Human Resource Manager informed Slater of

performance concern and specifically noted the amount of time Slater had taken

off work. In February 2007, Slater was terminated for performance concerns after

her supervisor accused Slater of making an error in a physical examination of a

crane operator.

1 Progress Energy and Florida Power are also Defendants in the underlying suit, but are not involved in this appeal.

3 On February 9, 2009, Slater filed her complaint against ESGI and the other

Defendants in the Middle District of Florida, alleging violations of Title VII, the

FCRA, and the FWA. Specifically, Slater alleged that the Defendants unlawfully

terminated her employment after she announced that she was pregnant. She also

alleged that she was fired in retaliation for objecting to the Defendant’s unlawful

conduct.2 Slater attached her Notice of Right to Sue letter from the Equal

Employment Opportunity Commission (EEOC) to the complaint. The EEOC

notice, dated January 6, 2009, indicated that Slater had ninety days from that date

to sue based on her Title VII claim.

On March 12, 2009, ESGI filed a motion to dismiss for improper venue

under Federal Rule of Civil Procedure 12(b)(3) based on the forum-selection

clause contained in the employment agreement. ESGI asked, alternatively, that the

district court transfer the case to the United States District Court for the Eastern

District of Virginia, Richmond Division, the only federal venue permitted by the

employment contract. On March 30, 2009, the remaining two Defendants

answered the complaint and conceded the propriety of venue in the Middle District

of Florida. On April 15, 2009, the district court granted ESGI’s Rule 12(b)(3)

2 The unlawful conduct involved Slater’s allegation that one or more of the Defendants awarded an employee a passing score on an eye examination that Slater claims she administered and witnessed the employee cheating.

4 motion and dismissed the claims against ESGI without prejudice. The court

reasoned that because the Defendants who were not parties to the agreement

containing the forum-selection clause had already answered the complaint and

admitted proper venue, it was not inclined to transfer the case as a whole. The

district court granted Slater’s Federal Rule of Civil Procedure Rule 54(b) motion

to appeal.

II.

This court reviews a district court’s construction of a contractual forum-

selection clause de novo. Global Satellite Commc’n Co. v. Starmill U.K. Ltd., 378

F.3d 1269, 1271 (11th Cir. 2004). We generally review the dismissal of a lawsuit

for improper venue under an abuse of discretion standard. Home Ins. Co. v.

Thomas Indus., Inc., 896 F.2d 1352, 1355 (11th Cir. 1990). However, where

venue is established by contract in a forum-selection clause, we review the

enforceablitity of that venue selection, like any other contract provision, on a de

novo basis. Rucker v. Oasis Legal Finance, LLC., ___ F.3d___, 2011 WL 476519

(11th Cir. 2011).

III.

Slater challenges three aspects of the district court’s dismissal. First, she

argues that the district court erred in finding that the scope of the forum-selection

5 clause includes her claims against her employers for employment discrimination.

Second, Slater argues that the district court erred in enforcing the forum-selection

clause in the face of adverse policy interests. Finally, Slater argues that the district

court erred in dismissing her case pursuant to Rule 12(b)(3) and should have

instead applied the transfer analysis under 28 U.S.C. § 1404(a).

A. Scope of the Forum-Selection Clause

Slater first contends that her Title VII and Florida statutory claims do not fit

within the scope of the employment agreement’s forum-selection clause. She

presents a number of only slightly varied arguments in support of her contention,

but principally argues that the forum-selection clause should be read to encompass

only breach-of-contract claims directly relating to the employment agreement.

Because her claims are statutorily based, she argues the forum-selection clause

does not apply.

Under general contract principles, the plain meaning of a contract’s

language governs its interpretation. Belize Telecom, Ltd. v. Belize, 528 F.3d 1298,

1307 & n.11 (11th Cir. 2008). The court must look at the contract as a whole, the

parties, and the purpose of the agreement to best determine the intent of the parties

in interpreting the agreement. Pennzoil Co. v. F.E.R.C., 645 F.2d 360, 388 (5th

6 Cir. 1981).3 If no other contract principles point to a particular meaning, the court

will prefer the reasonable interpretation that operates more strongly against the

party who drafted the document. Global Satellite, 378 F.3d at 1271 (citing Citro

Fla., Inc. v. Citrovale, S.A., 760 F.2d 1231, 1232 (11th Cir. 1985)).

This court and others often characterize forum-selection clauses as either

“permissive” or “mandatory.” Id. at 1272. “A permissive clause authorizes

jurisdiction in a designated forum but does not prohibit litigation elsewhere,”

whereas “[a] mandatory clause . . . ‘dictates an exclusive forum for litigation under

the contract.’” Id. (quoting Snapper, Inc. v. Redan, 171 F.3d 1249, 1262 n.24

(11th Cir. 1999)).

The forum-selection clause states that “all claims or causes of action

relating to or arising from this Agreement shall be brought in a court in the City of

Richmond, Virginia.” Based on a plain reading of the clause, we conclude that the

forum designation in the clause is not permissive, but mandatory. As we have

recognized, the use of the term “shall” is one of requirement. Id. at 1272 (“The

contract provision . . . because it uses the imperative ‘shall,’ is most reasonably

interpreted to mandate venue . . . .”). Thus, we hold that the claims within the

3 In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981), this court adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to October 1, 1981.

7 scope of the forum-selection clause must be brought in a court in Richmond,

Virginia, and not in the District Court for the Middle District of Florida.

We also conclude that Slater’s claims fall squarely within the scope of the

forum-selection clause. The clause is found in Slater’s contract for employment,

which governs the entirety of the employment relationship between Slater and

ESGI. The clause is expressly applicable to “all claims or causes of action relating

to or arising from [the employment agreement].” This includes all claims arising

“directly or indirectly” from the relationship evidenced by the contract. See

Stewart Org., Inc. v. Ricoh Corp., 810 F.2d 1066, 1070 (11th Cir. 1987), aff’d,

487 U.S. 22, 108 S. Ct. 2239 (1988). Slater claims that ESGI violated its

employment obligations by discriminating and retaliating against her. Therefore,

we conclude that Slater’s Title VII, FCRA, and FWA claims are within the scope

of the forum-selection clause.

B. Enforceability of the Forum-Selection Clause

Slater next argues that the forum-selection clause should not be applied to

her claims brought pursuant to Title VII, FCRA, and FWA for public policy

reasons. On appeal, Slater offers three policy arguments against enforcement of

the forum-selection clause: the policy against depriving plaintiffs of their day in

8 court, the policy against the maintenance of parallel proceedings, and the policy

against enforcing forum-selection clauses in civil rights actions.

Mandatory forum-selection clauses are “presumptively valid and

enforceable” absent a “strong showing that enforcement would be unfair or

unreasonable under the circumstances.” Krenkel v. Kerzner Int’l Hotels Ltd., 579

F.3d 1279, 1281 (11th Cir. 2009) (internal quotation marks and citation omitted).

“A forum-selection clause will be invalidated when: (1) its formation was induced

by fraud or overreaching; (2) the plaintiff would be deprived of its day in court

because of inconvenience or unfairness; (3) the chosen law would deprive the

plaintiff of a remedy; or (4) enforcement of the clause would contravene public

policy.” Id.

Slater raised only two policy arguments in the district court: that

enforcement of the forum-selection clause deprives her of her day in court and

violates this court’s policy against the maintenance of parallel proceedings. Slater

argues that enforcement of the forum-selection clause in this case effectively

denies her an opportunity to present her claim because her ninety-day period for

filing her Title VII claim has expired. Therefore, she argues, it is doubtful that she

will be able to refile her Title VII claim against ESGI in the Eastern District of

Virginia. Slater also argues that the court should decline to enforce the forum-

9 selection clause because it will result in parallel proceedings—one in the Eastern

District of Virginia against ESGI and one in the Middle District of Florida against

Progress Energy and Florida Power. Slater argues that maintaining two

proceedings is expensive, a drain on judicial resources, and may result in

inconsistent results or prejudice to her claims if the Defendants each try to cast

liability on an absent party.

Slater’s original policy arguments are not sufficient to establish the “strong

showing” of unenforceability required to overcome the presumption that a forum-

selection clause is valid and enforceable. First, Slater offers little more than

speculation that she may be unable to refile her claims against ESGI in the Eastern

District of Virginia; such speculation falls short of meeting her burden of showing

unenforeability. Further, we conclude that many of the dangers associated with

maintaining parallel proceedings are not implicated here. Slater has alleged that

ESGI employed her as a staffing employee and as part of its business operations

assigned her to work at Progress Energy’s plant facility as a

receptionist/healthcare technician for the other Defendants. The evidentiary

details regarding the employment relationship between Slater and ESGI and

between Slater and the other Defendants will not considerably overlap. Because

ESGI employed Slater in a different manner and made its termination decision

10 based on the reports from the other Defendants, the factual issues surrounding

Slater’s employment through ESGI will vary from the factual questions regarding

Slater’s employment with the other Defendants. Thus, separating the claims

against ESGI while Slater’s claims against the remaining two Defendants are

handled together does not implicate any danger typically associated with the

maintenance of parallel proceedings.

For the first time on appeal, Slater presents a third policy argument against

enforcement of the forum-selection clause: forum-selection clauses are

unenforceable as a matter of law in civil-rights actions. Appellate courts generally

will not consider a legal issue that was not presented to the trial court. Dean

Witter Reynolds, Inc. v. Fernandez, 741 F.2d 355, 360 (11th Cir. 1984). We have

recognized several exceptions to this rule, including where (1) the issue involves a

pure issue of law and refusal to consider it would result in a miscarriage of justice;

(2) the appellant did not have the opportunity to raise the issue to the district court;

(3) substantial justice is at stake; (4) the proper resolution is beyond any doubt;

and (5) the issue presents significant questions of great public concern. Id. at

360–61. Because we are persuaded that the exceptions are not applicable to

Slater’s argument, we decline to consider it for the first time on appeal.

C. Dismissal Pursuant to Rule 12(b)(3)

11 Finally, Slater contends that the district court abused its discretion by

dismissing her claims for improper venue pursuant to Rule 12(b)(3) rather than

applying the transfer analysis under 28 U.S.C. 1404(a).4 Slater claims that because

§ 1404(a) is the only proper procedural mechanism for enforcing a forum-selection

clause which designates venue in another United States District Court, the district

court erred by applying Rule 12(b)(3) instead of § 1404(a).

Our sister circuits disagree regarding the appropriate vehicle for enforcing

forum-selection clauses. Lipcon v. Underwriters at Lloyd’s, London, 148 F.3d

1285, 1289 (11th Cir. 1998) (recognizing circuit split); see e.g., Kerobo v. Sw.

Clean Fuels, Corp., 285 F.3d 531, 539 (6th Cir. 2002) (holding that the proper

analysis is under 28 U.S.C. § 1404(a)); Richards v. Lloyd’s of London, 135 F.3d

1289, 1292 (9th Cir. 1998) (applying Rule 12(b)(3) to an international forum-

selection clause); Lambert v. Kysar, 983 F.2d 1110, 1112 n.1 (1st Cir. 1993)

(applying Rule 12(b)(6)); AVC Nederland B.V. v. Atrium Inv. P’ship, 740 F.2d

148, 153 & n.8 (2d Cir. 1984) (applying Rule 12(b)(1) to an international forum-

selection clause).

4 Section 1404(a) provides: “For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.” 28 U.S.C. § 1404(a) (1996).

12 This court has held, in the context of a forum-selection clause which

mandated a foreign venue, that a motion pursuant to Rule 12(b)(3) is the proper

avenue for relief. Lipcon, 148 F.3d at 1289. In Lipcon, this court decided that

“motions to dismiss based upon forum-selection clauses ordinarily are not

properly brought pursuant to Rule 12(b)(1) . . . because the basis upon which the

defendants seek dismissal—namely, that the agreement of the parties prohibit the

plaintiff from bringing suit in the particular forum—is unrelated to the actual basis

of federal subject matter jurisdiction . . . .” Id. Instead, we concluded that a

motion pursuant to Rule 12(b)(3) is the proper vehicle to request dismissal of a

complaint on the basis of a contractual choice of forum. Id. at 1290. We further

supported our holding with the Supreme Court’s holding in Stewart Org., Inc. v.

Ricoh Corp., 487 U.S. 22, 25–32, 108 S. Ct. 2239–45 (1988), that 28 U.S.C. §

1404(a) controls the request of a party to give effect to a contractual forum-

selection clause by transferring the action. Specifically, the court noted: “the

[Ricoh] Court’s conclusion that the federal transfer-of-venue statute governs

district court decisions in enforcing forum-selection clauses provides support for

our view that motions to dismiss based upon forum-selection clauses are

cognizable as motions to dismiss for improper venue.” Lipcon, 148 F.3d at 1290

(emphasis in original).

13 Slater attempts to distinguish Lipcon and contends that Rule 12(b)(3)

dismissal is available as an enforcement mechanism only in cases where the

forum-selection clause at issue designates venue in a foreign country; otherwise,

she contends the party seeking enforcement of a domestic forum-selection clause

must request a transfer to the proper venue pursuant to § 1404(a). We disagree

that Lipcon should be read so narrowly. Underlying our reading of Stewart and

our holding in Lipcon is the view that courts must handle attempts to enforce

contractual forum-selection clauses as challenges to venue. In Stewart, the issue

on appeal concerned only the denial of the request to transfer venue, while in

Lipcon the defendant sought relief through dismissal. Accordingly, we conclude

that § 1404(a) is the proper avenue of relief where a party seeks the transfer of a

case to enforce a forum-selection clause, while Rule 12(b)(3) is the proper avenue

for a party’s request for dismissal based on a forum-selection clause. Thus, the

district court did not err in analyzing ESGI’s motion under Rule 12(b)(3) and

dismissing Slater’s claims for improper venue.

IV.

For the aforementioned reasons, we hold that the district court did not err in

dismissing Slater’s claims against ESGI for improper venue based on the forum-

14 selection clause contained in her employment agreement. Accordingly, we affirm

the district court’s judgment of dismissal.

AFFIRMED.