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Ksa Electronics, Inc. v. M/A-Com Technology Solutions, Inc.

United States District Court, S.D. California

March 6, 2015

KSA ELECTRONICS, INC. a California corporation, Plaintiff,
v.
M/A-COM TECHNOLOGY SOLUTIONS, INC., a Delaware corporation, Defendant.

ORDER GRANTING MOTION TO TRANSFER VENUE [ECF 7]

CYNTHIA BASHANT, District Judge.

On October 1, 2014, Plaintiff KSA Electronics, Inc. brought this breach of contract action against Defendant M/A-Com Technology Solutions, Inc. Plaintiff is a California corporation that contracted with Defendant to sell microchips on Defendant's behalf. Plaintiff's action arises under this contract and California statute.

The parties' contract included a forum selection clause, which required that any litigation arising from the contract be brought exclusively in either state or federal court in Massachusetts. The Court, in its discretion, has decided this matter on the papers submitted and without oral argument. See Civ. L.R. 7.1(d)(1). Therefore the Court DENIES Plaintiff's motion for oral argument. ECF 10.

For the following reasons, the Court GRANTS the motion. ECF 7. Defendant's ex parte application to stay discovery pending ruling on the motion to transfer venue is TERMINATED as MOOT. ECF 16.

I. BACKGROUND

Plaintiff is an independent sales agency based in San Diego, California. Compl. ¶¶ 1, 5, ECF 1. Defendant is a Massachusetts company with sales offices in California. Id. at ¶ 3. At some point in 2010, Defendant purchased Mimix, a company that had previously contracted with Plaintiff for sales services. Pl.'s Opp. 2:18-21, ECF 9. Plaintiff contends that for five months after that purchase, until November 2010, Plaintiff provided sales services to Defendant under the previous contract with Mimix. Id. at 2:18-3:7. At that point, the parties entered into the present Sales Representative Agreement ("SRA"). Ex. 1 to John F. Kennedy Decl., ECF 7-2. Kenneth Powers, Plaintiff's president, signed the SRA on November 16, 2010. Id. at 15. Provision 15 of the SRA requires that "[a]ny lawsuit with respect to or arising out of this Agreement or the transactions contemplated hereby shall be brought exclusively in a state or federal court of competent jurisdiction in the Commonwealth of Massachusetts, and MTS and the Representative each hereby submits, unconditionally and irrevocably, to the jurisdiction of the aforesaid courts for the purposes of any such lawsuit." Id. at 13-14.

Plaintiff claims the SRA resulted from Defendant's "take it or leave it" offer. Plaintiff claims Defendant position was "either sign the contract, with no revisions, or be replaced by a direct sales force." Kenneth Powers Decl. ¶ 5, ECF 9-1.

From 2010 until 2014, Plaintiff operated under the SRA and later-alleged oral agreements. Powers Decl. ¶ 8. Defendant then terminated the SRA on July 31, 2014. Id. at ¶ 9. Thereafter, Plaintiff sued for breach of the SRA and of the alleged oral agreements. ECF 1.

II. DISCUSSION

A forum-selection clause in a contract "may be enforced through a motion to transfer under [28 U.S.C.] § 1404(a)." Atl. Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas, ___ U.S. ___, 134 S.Ct. 568, 579 (2013). Section 1404(a) reads: "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 or to any district or division to which all parties have consented." "[P]roper application of § 1404(a) requires that a forum-selection clause be given controlling weight in all but the most exceptional cases.'" Id. (quoting Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 33 (1988) (Kennedy, J., concurring)).

When applying a valid forum-selection clause, the Court does not apply the original venue's choice of law rules and gives no deference to the plaintiff's venue choice or arguments about the parties' private interests. Atl. Marine, 134 S.Ct. at 581-82. Instead, the court may only consider public-interest factors. Id. at 582. "Because those factors will rarely defeat a transfer motion, the practical result is that forum-selection clauses should control except in unusual cases." Id.

Enforcing such forum-selection clauses "furthers vital interests of the justice system." Stewart, 487 U.S. at 33 (Kennedy, J., concurring). Therefore "a valid forum-selection clause is given controlling weight in all but the most exceptional cases." Id.

Forum-selection clauses are "prima facie valid and should be enforced unless enforcement is shown by the resisting party to be unreasonable under the circumstances." The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10, 92 S.Ct. 1907, 1913, 32 L.Ed.2d 513 (1972) (internal quotations omitted). Under The ...


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