UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
PSI Water Systems, Inc. d/b/a ENCON Evaporators
v. Civil No. 14-cv-391-LM Opinion No. 2015 DNH 119 Robuschi USA, Inc.
O R D E R
PSI Water Systems, Inc. (“ENCON”), which manufactures
evaporators that are used for water decontamination, has sued
Robuschi USA, Inc. (“Robuschi”) in five counts, asserting claims
arising from Robuschi’s sale of allegedly defective blowers that
ENCON incorporated into its evaporators.1 Before the court is
Robuschi’s motion to dismiss ENCON’s complaint. Robuschi’s
motion is based upon a forum selection clause that, according to
Robuschi, requires this matter to be litigated in Parma, Italy.
ENCON objects. The court heard oral argument on Robuschi’s
motion on June 3, 2015. For the reasons that follow, Robuschi’s
motion is denied.
1 Specifically, ENCON asserts claims for: (1) breach of express warranty; (2) breach of the warranty of fitness for a particular purpose; (3) breach of the warranty of merchantability; (4) misrepresentation; and (5) violation of the New Hampshire Consumer Protection Act. The Legal Standard
As a preliminary matter, there is some dispute over the
proper procedural mechanism for litigating the enforcement of a
forum selection clause, such as the one on which Robuschi
relies, that requires litigation in a forum outside the federal
judicial system.
In Rivera v. Centro Médico de Turabo, Inc., the court of
appeals for this circuit pointed out that “[i]n this circuit, we
treat a motion to dismiss based on a forum selection clause as a
motion alleging the failure to state a claim for which relief
can be granted under Rule 12(b)(6).” 575 F.3d 10, 15 (1st Cir.
2009) (citing Silva v. Encyc. Britannica, Inc., 239 F.3d 385,
387 & n.3 (1st Cir. 2001); Lipcon v. Underwriters at Lloyd’s,
London, 148 F.3d 1285, 1289-90 (11th Cir. 1998)).
The plaintiff, however, argues that Atlantic Marine
Construction Co. v. United States District Court for the Western
District of Texas provides the applicable mechanism. In that
case, the United States Supreme Court stated that “the
appropriate way to enforce a forum-selection clause pointing to
a state or foreign forum is through the doctrine of forum non
conveniens.” 134 S. Ct. 568, 580 (2013). But, the Supreme
Court also had this to say:
An amicus before the Court argues that a defendant in a breach-of-contract action should be
2 able to obtain dismissal under Rule 12(b)(6) if the plaintiff files suit in a district other than the one specified in a valid forum-selection clause. See Brief for Stephen E. Sachs as Amicus Curiae. Petitioner, however, did not file a motion under Rule 12(b)(6), and the parties did not brief the Rule’s application to this case at any stage of this litigation. We therefore will not consider it.
Id.
After Atlantic Marine, the First Circuit returned to the
question of the proper procedure for asserting a defense based
upon a forum selection clause in Claudio-de León v. Sistema
Universitario Ana G. Méndez, 775 F.3d 41 (1st Cir. 2014). The
First Circuit noted that:
[A]bsent a clear statement from the Supreme Court to the contrary, the use of Rule 12(b)(6) to evaluate forum selection clauses is still permissible in this Circuit, and we will not decline to review or enforce a valid forum selection clause simply because a defendant brought a motion under 12(b)(6) as opposed to under § 1404 or forum non conveniens.
Id. at 46 n.3. Based upon the foregoing, the court cannot agree
with plaintiff that Atlantic Marine takes Rule 12(b)(6) off the
table as a mechanism for enforcing the forum selection clause
that defendant invokes.
That said, “[t]he fact that a motion to dismiss on the
basis of a forum selection clause is treated as a [Rule]
12(b)(6) motion has certain consequences for the materials that
[this] court may appropriately consider when ruling on such a
motion.” Rivera, 575 F.3d at 15. Specifically:
3 Under Rule 12(b)(6), the district court may properly consider only facts and documents that are part of or incorporated into the complaint; if matters outside the pleadings are considered, the motion must be decided under the more stringent standards applicable to a Rule 56 motion for summary judgment.
Id. (internal quotation marks omitted).
Here, resolution of the issue before the court depends upon
the court’s consideration of matters outside the pleadings, such
as the document containing the forum selection clause on which
Robuschi relies. Under Rule 12(d), “[i]f, on a motion under
Rule 12(b)(6) . . . matters outside the pleadings are presented
to and not excluded by the court, the motion must be treated as
one for summary judgment under Rule 56.” Rule 12(d) further
provides that “[a]ll parties must be given a reasonable
opportunity to present all the material that is pertinent to the
motion.” At oral argument, both parties affirmed that all the
material necessary to rule on Robuschi’s motion has been placed
before the court. Accordingly, the court treats Robuschi’s Rule
12(b)(6) motion as one for summary judgment under Rule 56.
A movant is entitled to summary judgment upon a showing
“that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). In reviewing the record, the court construes all
facts and reasonable inferences in the light most favorable to
4 the nonmovant. Kelley v. Corr. Med. Servs., Inc., 707 F.3d 108,
115 (1st Cir. 2013).
Background
In this section, some general background is drawn from
ENCON’s complaint, while the facts germane to resolving the
question before the court are drawn from the summary judgment
record. That said, with respect to the applicability of the
forum selection clause on which Robuschi relies, there are no
facts in dispute.
ENCON manufactures evaporators and evaporator systems.
Robuschi manufactures blowers, which can be incorporated into
evaporators such as the ones ENCON manufactures. ENCON
purchased eight blowers from Robuschi. Six of them failed
within months of being put into service, and the other two have
not been put into service.
The court now turns to the facts underlying Robuschi’s
contention that ENCON is barred from litigating its claims in
this court by a forum selection clause that was included in the
contract under which ENCON purchased Robuschi’s blowers.
As a preliminary matter, it is undisputed that there is no
single purchase and sale agreement that covers the transactions
involving the eight blowers at issue in this case. The summary
judgment record does, however, include: (1) three proposals
5 transmitted by Robuschi to ENCON covering three blowers,2 none of
which says anything about the forum in which disputes between
Robuschi and ENCON were to be litigated; (2) six purchase orders
submitted by ENCON to Robuschi covering eight blowers,3 none of
which says anything about choice of forum; (3) one invoice
issued by Robuschi to ENCON covering one blower, which says
nothing about choice of forum; and (4) four order confirmations
transmitted by Robuschi to ENCON covering five blowers, none of
which says anything about choice of forum. Not only were
Robuschi’s proposals, invoices, and order confirmations silent
as to the matter of forum selection, there is no evidence that
any of those documents was transmitted to ENCON in association
with any other document(s) that addressed the matter of forum
selection.
On February 24, 2011, after Robuschi had sent ENCON three
proposals and before ENCON placed its first order on March 10,
2011, ENCON’s president, Mark Fregeau, received an e-mail from
Robuschi’s sales manager, Christopher Harper. That e-mail,
2 One of the proposals is dated August 3, 2010; the other two are dated October 25, 2010.
3 Two of the purchase orders (each for one blower) are dated March 10, 2011; an order for two blowers is dated December 5, 2011; an order for two blowers is dated December 16, 2011; an order for one blower is dated June 18, 2012; and an order for one blower is dated October 23, 2012.
6 transmitted: (1) a credit application; (2) an IRS W-9 form; and
(3) a document titled “Terms & Conditions of Sale” (“Terms &
Conditions”). The Terms & Conditions begins with the following
sentence:
Sales contracts entered into by Robuschi USA, Inc. (“Seller”) are governed by these general conditions of sale, with the exception of variations explicitly agreed [to] in writing and expressly approved in writing by the General Management of the Seller.
Pl.’s Obj., Fregeau Decl., Ex. F (doc. no. 10-8), at 2 of 11.
That document also includes the following provision, which was
highlighted in the copy Harper sent to Fregeau:
All disputes arising from this contract and its interpretation and/or execution are subject to Italian jurisdiction and attributed exclusively to the competence of the court of Parma, and the Buyer expressly relinquishes his own jurisdiction and all other places of jurisdiction.
Id. at 6 of 11. Finally, the document includes a signature line
calling for execution by a representative of the buyer.
While Fregeau executed and returned both the credit
application and the W-9 form, he neither filled in the signature
line of the Terms & Conditions nor returned that document to
Robuschi. Pl.’s Obj., Fregeau Decl. (doc. no. 10-2) ¶¶ 8-9. In
the e-mail by which ENCON transmitted the executed credit
application and W-9 form to Robuschi, an ENCON office
administrator explicitly asked whether Robuschi “need[ed] any
additional information.” Fregeau Decl., Ex. G (doc. no. 10-9),
7 at 1 of 2. Nobody from Robuschi ever asked ENCON for an
executed copy of the Terms & Conditions. Fregeau Decl. (doc.
no. 10-2) ¶ 10.
Discussion
Based upon the foregoing, Robuschi argues that the forum
selection clause recited in the Terms & Conditions was a part of
its contract with ENCON. ENCON disagrees. ENCON has the better
argument.
The applicable law has been aptly summarized in a recent
order from Judge Laplante:
“Before a court considers whether to enforce a forum selection clause, it must decide a few threshold matters, such as whether (1) the parties entered into a valid contract of which the forum selection clause was an agreed-to provision, (2) the clause is mandatory and (3) the clause governs the claims asserted in the lawsuit.” Provanzano v. Parker View Farm, Inc., 827 F. Supp. 2d 53, 58 (D. Mass. 2011); see also Altvater Gessler–J.A. Baczewski Int’l (USA) Inc. v. Sobieski Destylarnia S.A., 572 F.3d 86, 89 (2d Cir. 2009) (similar). The party seeking enforcement of the clause bears the burden of establishing these elements by a preponderance of the evidence. Altvater, 572 F.3d at 89; AIG Mexico Seguros Interamericana, S.A. de C.V. v. M/V Zapoteca, 844 F. Supp. 2d 440, 442 (S.D.N.Y. 2012). Expedition Leather LLC v. FC Org. Prods. LLC, No. 11-cv-588-
JL, 2013 WL 160373, at *1 (D.N.H. Jan. 15, 2013).4 The court’s
4 Judge Laplante also explained that “[w]here the applicability of a forum selection clause turns on disputed factual issues, ‘the district court may weigh evidence, assess credibility, and make findings of fact that are dispositive.’” Expedition, 2013 WL 160373, at *1 (quoting Murphy v. Schneider
8 analysis begins and ends with the first threshold matter, i.e.,
whether ENCON and Robuschi entered into a valid contract that
included the forum selection clause from the Terms & Conditions
as an agreed-to provision.
ENCON does not dispute that it entered into several valid
contracts with Robuschi for the purchase and sale of blowers.
The dispositive question is whether the forum selection clause
from the Terms & Conditions was an agreed-to provision of any
such contract.
Before turning to that question, however, it is useful to
focus on contract formation and consider the manner in which the
agreement between the parties was made. New Hampshire’s
enactment of the Uniform Commercial Code (“UCC”) applies to this
transaction because the transactions at issue have a “reasonable
relation” to New Hampshire. See RSA § 382-A:1-301. Under the
UCC, “[a] contract for sale of goods may be made in any manner
sufficient to show agreement, including conduct by both parties
which recognizes the existence of such a contract.” N.H. Rev.
Stat. Ann. (“RSA”) § 382-A:2-204(a). Notwithstanding the
flexibility of the UCC, and regardless of the particular manner
Nat’l, Inc., 362 F.3d 1133, 1139–40 (9th Cir. 2004)). Here, however, there appear to be no disputed factual issues requiring factfinding.
9 in which a contract is formed, contract formation requires an
offer and its acceptance. See RSA 382-A:2-206.
In the memorandum of law supporting its motion to dismiss,
Robuschi simply assumes that the forum selection clause in the
Terms & Conditions applies and offers no theory of contract
formation. ENCON argues that this case involves a series of
contracts, each formed by means of a purchase order (offer) and
an order confirmation (acceptance). In so arguing, ENCON relies
upon Dyno Construction Co. v. McWane, Inc. for the proposition
that “[t]ypically, a price quotation is considered an invitation
for an offer, rather than an offer to form a binding contract.”
198 F.3d 567, 572 (6th Cir. 1999) (quoting White Consol. Indus.,
Inc. v. McGill Mfg. Co., 165 F.3d 1185, 1190 (8th Cir. 1999)).
Robuschi responds:
It makes no difference, as ENCON asserts, that “quotes or proposals are generally not to be considered offers . . . .” (Pl.’s Mem. at 13.) Robuschi’s Terms & Conditions were its unequivocal declaration of the ground rules upon which it would agree to supply goods in the future, whether pursuant to a single order or a series of them. If ENCON disagreed with any of the Terms & Conditions, it could have objected and resolved its disagreement before placing any orders. It did not.
Def.’s Reply Mem. (doc. no. 13) 4.
Robuschi, however, provides no authority for the
proposition that a term in a unilateral declaration of “ground
rules” promulgated by a seller independent from either an offer
10 or an acceptance is an agreed-to provision of the contract
between that seller and a buyer. Moreover, the law on this
point favors ENCON.
In Bent Glass Design v. Scienstry, Inc., Civ. No. 13-4282,
2014 WL 550548 (E.D. Pa. Feb. 12, 2014), a buyer sued a seller
and the seller moved to transfer venue based upon a forum
selection clause that was included in a set of terms and
conditions that was transmitted to the buyer independently from
any of the documents that constituted the offer and acceptance
that formed the contract between the parties. In that case, the
buyer argued that its contract with the seller was formed when
it sent the seller a purchase order in response to a price
quotation. See id. at *8. The seller “argue[d] that the
contract was formed when [the buyer] placed its first order
[five days later], and that [the buyer]’s knowledge of the Terms
and Conditions incorporated them within the agreement.” Id.
The seller imputed knowledge of the Terms and Conditions to the
buyer
because [the buyer] “knew of and/or should have known of the terms and conditions of sale, which included the forum selection clause, because it was incorporated into two emails that were sent to and received by [the buyer], in addition to being on [the seller’s] website, which [the buyer] visited before ever contacting [the seller].”
11 Id. (quoting the record). Judge Kelly was not persuaded,
pointing out that the seller’s price quotation and the buyer’s
purchase order were mirror images of each other, and that
neither one included either the seller’s terms and conditions or
any reference to them. See id. at *9. Judge Kelly also
rejected the seller’s incorporation by reference argument
because “there was no clear reference to the Terms and
Conditions in the [documents that memorialized] the contract.”
Id. at *10.
Standing in contrast to Bent Glass is Golden Valley Grape
Juice & Wine, LLC v. Centrisys Corp., No. CV F 09-1424 LJO GSA,
2010 WL 347897 (E.D. Cal. Jan. 22, 2010). While that case was
governed by the United Nations Convention on Contracts for the
International Sale of Goods rather than the UCC, it is
nonetheless instructive. In Golden Valley, Judge O’Neill ruled
that a set of general conditions was incorporated into the
agreement between a buyer and a seller. See id. at *5. But in
Golden Valley, “the General Conditions accompanied the sales
quote [and] were attached, contemporaneously, with the sales
quote and with other sale information, such as warranty
information and banking information, which were included in the
email.” Id. According to Judge O’Neill:
The evidence establishes that at the time STS sent its sales quote to Centrisys, it contemporaneously sent
12 its General Conditions as part of the attachments. By adopting the terms of the sales quote, Centrisys accepted the terms upon which the centrifuge had been offered, including the General Conditions. Thus, Centrisys accepted the General Conditions.
Id. Here, in contrast, Robuschi has produced no evidence that
it attached the Terms & Conditions to either its proposals or
its order confirmations.
As the court has noted, ENCON’s theory of contract
formation, which Robuschi does not contest, is that the purchase
orders it submitted to Robuschi were offers that were accepted
by Robuschi’s order confirmations. If Robuschi’s terms and
conditions had been printed on its order confirmations, if the
Terms & Conditions had been mentioned in those confirmations, or
if a copy of the Terms & Conditions had been transmitted
contemporaneously with Robuschi’s confirmations, then, perhaps,
the court would have to determine, under RSA 382-A:2-207,
whether the forum selection clause was a provision of the
parties’ agreement. See JOM, Inc. v. Adell Plastics, Inc., 193
F.3d 47, 52-59 (1st Cir. 1999) (performing § 2-207 analysis
based upon damage limitation provision contained in invoices);
Golden Valley, 2010 WL 347897, at *5. But, there is no evidence
that Robuschi included any provision from the Terms & Conditions
in its confirmations of ENCON’s orders, referred to the Terms &
Conditions in its confirmations, or sent ENCON a copy of the
13 Terms & Conditions in connection with its acceptance of ENCON’s
orders. Accordingly, under ENCON’s theory of contract
formation, the court has no basis for conducting a § 2-207
analysis, and no basis for finding that the forum selection
clause was an agreed-to provision of any contract between ENCON
and Robuschi. Moreover, while Robuschi does not propose an
alternative theory of contract formation, there is no theory
under which the outcome would be different. That is, even if
the contract(s) in this case had been formed by a proposal and a
purchase order, as in Bent Glass, see 2014 WL 550548, at *8,
rather than by a purchase order and an order confirmation, the
forum selection clause on which Robuschi relies was not printed
on the proposal, incorporated by reference into it, or
transmitted contemporaneously with it.
In light of Bent Glass and Golden Valley, and the
undisputed facts in the summary judgment record, the court
concludes that Robuschi has not carried its burden of
establishing, by a preponderance of the evidence, that the forum
selection clause in the Terms & Conditions was an agreed-to
provision of any contract between itself and ENCON for the
purchase and sale of blowers. In so ruling, the court
recognizes that in Expedition, the parties agreed that the
contract between them did include a term drawn from a set of
14 “Standard Terms and Conditions” that the buyer had sent the
seller a month before it issued a purchase order that the seller
later accepted in writing. While the scenario in Expedition
might seem to support Robuschi’s position, it is important to
note that the parties in Expedition never litigated, and Judge
Laplante never decided, whether a set of general terms and
conditions can become a part of a contract when those terms and
conditions are not directly associated with either the offer or
the acceptance underlying the formation of the contract between
a buyer and a seller. Accordingly, Expedition does nothing to
support Robuschi’s position.
Conclusion
For the reasons detailed above, Robuschi’s motion to
dismiss, document no. 6, treated herein as a motion for summary
judgment, is denied.
SO ORDERED.
__________________________ Landya McCafferty United States District Judge
June 16, 2015
cc: Steve E. Grill, Esq. Michael D. Huitink, Esq. Edward M. Kaplan, Esq. Matthew M. Wuest, Esq.