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New Image Painting, Inc. v. Home Depot U.S.A.

December 7, 2009

NEW IMAGE PAINTING, INC., PLAINTIFF,
v.
HOME DEPOT U.S.A., INC., DEFENDANTS.



The opinion of the court was delivered by: Andrew J. Guilford United States District Judge

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS UNDER RULE 12(b)(3)

This case involves a contract dispute between Plaintiff New Image Painting, Inc. ("New Image") and Defendant Home Depot U.S.A., Inc. ("Defendant"). Plaintiff filed its Complaint in Orange County Superior Court, and Defendant removed the case to this Court. Defendant now brings a Motion to dismiss for improper venue under Rule 12(b)(3) or, in the alternative, to transfer to the Northern District of Georgia under 28 U.S.C. § 1404 or § 1406 ("Motion"). After considering all papers and arguments submitted, the Motion to Dismiss is GRANTED.

BACKGROUND

The following facts are taken from Plaintiff's Complaint and documents the Plaintiff refers to in its Complaint, and for purposes of this Motion, the Court takes them to be true.

In 2004, Plaintiff and Defendant entered into a written Service Provider Agreement ("SPA") where Defendant "agreed to use [Plaintiff] as an independent contractor to provide interior and exterior primer, paint, stain, and waterproofing services to customers of Home Depot." (Compl. ¶ 10.) Paragraph 14.3 of the SPA is a choice of forum provision that reads: "[L]egal or equitable actions arising out of, or relating to, this SPA or the breach thereof shall be exclusively brought in either the Superior Court of Cobb County, Georgia, or the United States District Court for the Northern District of Georgia, Atlanta Division." (Declaration of Hector Padilla ("Padilla Decl."), Exh. 1, ¶ 14.3.) Paragraph 14.5 of the SPA is an attorney fee clause that would award attorney fees to Defendant if Defendant prevails "in any legal or equitable action brought under [the SPA]." (Padilla Decl., Exh. 1, ¶ 14.3.) There is no reciprocal right to fees for Plaintiff.

From 2005 to 2006, the parties orally renegotiated many of the terms of the SPA. (Compl. ¶¶ 19-23.) Plaintiff alleges that Defendant breached material terms of the oral agreement. (Compl. ¶ 36.) Plaintiff also alleges that Defendant knowingly made numerous misrepresentations, broke numerous promises, and omitted material facts throughout the course of the relationship. (Compl. ¶¶ 38-40.) Based on these facts and others, Plaintiff filed its Complaint, in Orange County Superior Court, for breach of oral contract, fraud, and negligent misrepresentation. Defendant removed the case to this Court, and now moves to dismiss, or in the alternative to transfer to the Northern District of Georgia, based on the forum selection clause in the SPA.

PRELIMINARY MATTERS

Plaintiff filed a request for judicial notice, asking the Court to take judicial notice of the following three documents: (1) Declaration of Melanie Graham in support of Defendant's Notice of Removal; (2) Declaration of Kimberly Symons in support of Defendant's Notice of Removal; and (3) Declaration of David B. Richa in support of Defendant's Notice of Removal. Under Federal Rule of Evidence 201, "[a] judicially noticed fact must be one not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." The Court finds that these three documents meet the requirements of Rule 201, and Plaintiff's request for judicial notice is GRANTED.

Plaintiff also filed numerous objections to evidence submitted in support of Defendant's Motion. Many of these objections are to copies of emails attached to Defendant's declarations. These objections are based on the "Best Evidence Rule," Federal Rule of Evidence 1002. It is unclear whether Plaintiff objects to the witness description of exhibits in the declaration, or whether Plaintiff objects to the copies of the emails. Regardless, the objections are OVERRULED. The declarants' descriptions of the emails are provided to give the Court a context for the emails, and the descriptions are based on personal knowledge of the declarants. The Best Evidence Rule does not prohibit a witness from testifying about what the witness did, saw, or heard, even if those facts are also embodied in a writing. U.S. v. Bennett, 363 F.3d 947, 953 (9th Cir. 2004). Further, to the extent that Plaintiff objects to the actual email itself, a duplicate of a document is admissible to the same extent as the original unless "(1) a genuine question is raised as to the authenticity of the original or (2) in the circumstances it would be unfair to admit the duplicate in lieu of the original." Fed. R. Evid. 1003. Here, Plaintiff has not raised a question as to the authenticity of the original emails, and the Court does not find that it would be unfair to admit the duplicate copies of the emails. Accordingly, the objections based on the Best Evidence Rule are OVERRULED. The Court's analysis does not rely on the remainder of the evidence under objection, so the remaining objections are OVERRULED as moot.

LEGAL STANDARD

A motion to dismiss based on a forum selection clause may properly be treated as a motion to dismiss for improper venue under Rule 12(b)(3). Argueta v. Banco Mexicano, S.A., 87 F.3d 320, 324 (9th Cir. 1996). In considering such a motion, district courts may "consider facts outside of the pleadings." Id. The court must draw all reasonable inferences and resolve all factual conflicts in favor of the non-moving party. See Murphy v. Schneider Nat'l, Inc., 362 F.3d 1133, 1138 (9th Cir. 2004). In deciding a Rule 12(b)(3) motion, district courts have the discretion to dismiss the case. See 28 U.S.C. § 1406(a).

Federal law applies here to the interpretation of the forum selection clause. Manetti-Farrow, Inc. v. Gucci America, Inc., 858 F.2d 509, 513 (9th Cir. 1988). "Forum selection clauses are prima facie valid, and are enforceable absent a strong showing by the party opposing the clause 'that enforcement would be unreasonable or unjust, or that the clause [is] invalid for such reasons as fraud or overreaching.'" Id. at 514 (quoting Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15 (1972)) (modification in original).

ANALYSIS

The Court finds that dismissal under Rule 12(b)(3) is appropriate here. In Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273 (9th ...


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