United States District Court, S.D. Ohio, Western Division, Dayton
ENTRY AND ORDER DENYING DEFENDANT WESTERN CANADA
PLATE EXCHANGER, LTD.'S MOTION TO DISMISS. (DOC. 14) THE
PARTIES ARE ORDERED TO SUBMIT A RULE 26(F) REPORT.
M. ROSE UNITED STATES DISTRICT JUDGE.
the Court is a Motion to Dismiss filed by Defendant Western
Canada Plate Exchanger, Ltd. (Doc. 14). Defendant asserts
that Plaintiff WCR Incorporated's Complaint (Doc. 10)
should be dismissed for lack of personal jurisdiction under
Federal Rule of Civil Procedure 12(b)(2). (Doc. 14, PageID
85). Additionally, Defendant contends that venue is improper
pursuant to Federal Rule of Civil Procedure 12(b)(3).
(Id. at PageID 85, 98). Finally, the Defendant
claims that the Complaint should be dismissed under the
doctrine of forum non conveniens since alternate forums are
available and both private and public interest factors favor
such a dismissal. Because the parties agreed to a forum
selection clause stipulating that they would forgo their
private interests as to where any dispute would be heard, and
because no public interests overcome that agreement, the
motion will be denied.
WCR, Incorporated, hereinafter referred to as “WCR,
” designs and manufactures plate heat exchangers, which
are used in a wide variety of industries to heat and cool
liquids. (Doc. 10, PageID 58). Though the company maintains
several branch offices throughout the United States and
distributes their product worldwide, their headquarters and
principal place of business are located in Fairborn, Ohio.
(Id. at PageID 57-58). WCR allegedly employs
approximately 130 Ohioans. (Doc. 15, PageID 109). Defendant,
Western Canada Plate Exchanger, Ltd., hereinafter referred to
as “Western Canada, ” is a Canadian company whose
principal place of business is located in Alberta, Canada.
(Doc. 10, PageID 57). According to the Complaint, WCR enters
into service and distribution agreements with local
distributors in other regions of the world to sell WCR's
goods and services in that region. (Id. at PageID
58). In those instances, WCR does not enter the territory
itself, instead relying upon the local distributor to provide
their goods and services. Id.
1, 2010, WCR and Western Canada entered into such a service
and distribution agreement, which was renewed on a regular
basis up through the agreement at issue in this case,
hereinafter referred to as “the Agreement, ”
which began on January 1, 2017 and ran through December 31,
2018. Id. WCR allegedly initiated the negotiation of
the original service and distribution agreement in 2010 with
Western Canada, and all the negotiations allegedly took place
while the representatives of Western Canada were in Canada.
(Doc. 14, PageID 91-92). Pursuant to the Agreement, Western
Canada purchased products that were allegedly designed and
manufactured at the WCR facility in Washington Court House,
Ohio and were then shipped from that same location to Western
Canada. (Doc. 10, PageID 59). Invoices sent to Western Canada
detailing the orders and shipment information were printed on
WCR letterhead and required payment to the Ohio address.
Id. Western Canada employees allegedly communicated
with WCR employees located in Ohio regarding the Agreement
and traveled “on one or more occasions” to
WCR's headquarters in Ohio to promote sales of WCR
products and undergo training. Id.
Agreement governs the business relationship between WCR and
Western Canada and includes a choice of law provision.
Section 19 of the Agreement states that it will be
“enforced in accordance with, the laws of the State of
Ohio.” (Id. at PageID 58). Section 9F of the
Agreement imposes WCR's “Terms and Conditions,
” which are allegedly attached to every invoice. (Doc.
15, PageID 111-12). The Terms and Conditions to which Western
Canada are bound include an express forum selection clause
submitting Western Canada to jurisdiction in Ohio.
(Id. at 112).
claims Western Canada breached Articles 9D and 12 of the
Agreement, which state that Western Canada will only
“sell, use, and install” WCR products or products
approved by WCR and that Western Canada and its shareholders
will not be involved in any business which provides goods or
services similar to those provided by WCR without their
written consent. (Doc. 10, PageID 59-60). Western
Canada's Director and sole Voting Shareholder was
allegedly the director of Salarix, a Canadian company that
provides goods and services similar to those provided by WCR,
at the same time he was serving in his positions with Western
Canada. (Id. at PageID 60-61). WCR argues that since
an agent of Western Canada was associated with a business
similar to WCR without their consent, Western Canada breached
the Agreement. (Id. at PageID 61). For each of those
breach of contract claims, WCR alleges damages in excess of
$75, 000 plus interest in lost profits. (Id. at
Complaint also alleges that Western Canada breached Section
9F of the Agreement and Section 5 of the Terms and Conditions
by failing to pay for a custom order that they cancelled.
(Id. at PageID 63). Section 5 of the Terms and
Conditions states that “custom manufactured goods must
be paid for in full even if the order is cancelled.”
Id. WCR claims they are entitled to compensatory
damages from this alleged breach of the Agreement.
(Id. at PageID 64).
August 17, 2018, WCR filed their original complaint against
Western Canada. (Doc. 1). On October 11, 2018, Western Canada
filed a motion to dismiss for lack of personal jurisdiction,
improper venue, and/or forum non conveniens. (Doc. 9). In
response, WCR filed their amended complaint on October 24,
2018, herein referred to as “the Complaint.”
(Doc. 10). On November 7, 2018, Western Canada filed the
motion to dismiss for lack of jurisdiction, improper venue,
and/or forum non conveniens which is currently before the
Court. (Doc. 14). WCR filed a response in opposition to
Western Canada's motion to dismiss on November 28, 2018.
Finally, Western Canada filed a reply brief in support of
their motion to dismiss on December 12, 2018. Currently, the
motion to dismiss is ripe for decision.
asserts in the Complaint that the Court has diversity
jurisdiction over the case pursuant to 28 U.S.C. §1332
because WCR is a citizen of the state of Ohio and Western
Canada is a citizen of a foreign state, specifically Canada,
and the amount in controversy exceeds $75, 000, exclusive of
interest and costs.
Standard of Review
Canada seeks dismissal of WCR's claims under Federal Rule
of Civil Procedure 12(b)(2), which challenges the court's
personal jurisdiction of a case. In order to survive a motion
to dismiss for lack of personal jurisdiction purely on the
motions, a plaintiff must make a prima facie case
that the court has personal jurisdiction. Kroger Co. v.
Malease Foods Corp., 437 F.3d 506, 510 (6th Cir. 2006)).
In motions to dismiss decided purely upon the pleadings, the
court must consider the pleadings and affidavits in a light
most favorable to the plaintiff and cannot take into
consideration the controverting assertions of the party
seeking dismissal. CompuServe, Inc. v. Patterson, 89
F.3d 1257, 1262 (6th Cir. 1996). However, courts may consider
the defendant's undisputed assertions. Kerry Steel,
Inc. v. Paragon Indus., 106 F.3d 147, 153 (6th Cir.
1997). When the court holds an evidentiary hearing, the
plaintiff must establish by a preponderance of the evidence
specific facts that the court has personal jurisdiction over
the non-resident defendant. Kroger at 510.
As the Court held no evidentiary hearing in this case, WCR
need only make a prima facie case that the Court has
personal jurisdiction over Western Canada.
Plaintiff s prima facie burden is relatively slight,
the Court must still find that A'[P]laintiff has set
forth specific facts that support a finding of jurisdiction
in order to deny the motion to dismiss.'" Palnik
v. Westlake Entm't, Inc.,344 Fed.Appx. 249, 251
(6th Cir. 2009) (quoting Kroger Co. v. Malease Foods
Corp.,437 F.3d 506, 510 (6th Cir. 2006)). Thus, Ait
remains the plaintiffs burden and the complaint must have
'established with reasonable particularity' those
specific facts that support jurisdiction." Id.
(quoting Neogen Corp. v. Neo Gen Screening, Inc.,282 F.3d 883, 887 (6th Cir. 2002). Consequently, the rules
are designed in part to protect ...