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Pamela Myers et al. v. Jani-King of Philadelphia

December 5, 2012

PAMELA MYERS ET AL.
v.
JANI-KING OF PHILADELPHIA, INC., ET AL.



The opinion of the court was delivered by: Surrick, J.

MEMORANDUM

Presently before the Court is Defendants' Motion to Dismiss or Transfer. (ECF No. 8.) For the following reasons, the Defendants' Motion will be granted in part and denied in part.

I. BACKGROUND

On March 20, 2009, Plaintiffs Pamela Myers, Darryl Williams, and Wyatt Seals filed this class-action lawsuit against Defendants Jani-King of Philadelphia, Inc. ("JKP"), Jani-King, Inc. ("JK"), and Jani-King International, Inc. ("JKI") in the Philadelphia County Court of Common Pleas. (Notice of Removal, Compl. Ex. A, ECF No. 1.) Defendant JKP is a Texas corporation with its principal place of business in Pennsylvania, and is a wholly-owned subsidiary of JK.*fn1

(Compl. ¶ 6.) Defendants JK., and JKI are Texas corporations with principal places of business in Addison, Texas. (Compl. ¶¶ 7-8.) JK is a wholly-owned subsidiary of JKI. (Id.. ¶ 7.) JKP offers franchises for commercial cleaning businesses to persons who wish to own and conduct such businesses under the Jani-King name. (Burleson Decl., ECF No. 10.)

The named Plaintiffs are all residents of Pennsylvania. (Compl. ¶¶ 3-5.) The proposed class of Plaintiffs consists of "all persons who performed cleaning services for Defendants in Pennsylvania from March 20, 2006 to the present." (Id. ¶ 15.) Using the Franchisee List of April 2007, Plaintiffs calculate that the group of potential class members for the class period consists of approximately 185 individuals with addresses in Pennsylvania and approximately sixty-one individuals with addresses outside of Pennsylvania. (Pls.' Remand Mem, Franchisee List Ex. A., ECF No. 11.)

Plaintiffs allege, on behalf of themselves and all others similarly situated, that Defendants sold them rights to Defendants' cleaning services franchise, and that the franchise agreements that secured those rights were, in reality, illegal employment agreements. (Compl. ¶ 25.) The Complaint sets forth the following claims: violation of the Pennsylvania Minimum Wage Act (MWA), 43 Pa. Cons. Stat. §§ 333.101, et seq. (Count I); violation of the Pennsylvania Wage Payment and Collection Law ("WPCL"), 43 Pa. Cons. Stat. §§ 260.1, et seq. (Count II); breach of contract (Count III); breach of the duty of good faith and fair dealing (Count IV); and unjust enrichment (Count V). On April 24, 2009, Defendants removed the action to this Court based on the Class Action Fairness Act of 2005 ("CAFA"), 28 U.S.C. § 1332(d)(2). (Notice of Removal.) On May 14, 2009, Plaintiffs filed a motion for remand to the Philadelphia Court of Common Pleas (ECF No. 6) and an accompanying Memorandum (ECF No. 11). On August 4, 2009, we entered an Order (ECF No. 29) and Memorandum (ECF No. 28) denying Plaintiffs' motion for remand.

Defendants filed the instant Motion to Dismiss or Transfer (Defs.' Mot., ECF No. 8), a Memorandum of Law in support thereof (Defs.' Mem.), and a Declaration from Donald A. Burleson (Burleson Decl). Defendants argue that the forum selection clause provided in the franchise agreements at issue must be enforced, and accordingly the case should be dismissed in its entirety, or in the alternative transferred to the Northern District of Texas. (Defs.' Mot. 2.) The forum selection clause states as follows:

The parties agree and intend this instrument to be executed, interpreted and construed in accordance with the laws of the state of Texas without reference to conflict of laws principles. Texas law shall apply to all claims, disputes, and disagreements between the parties, whether arising from alleged breaches of the contract or agreement or other claims arising in any way from the parties' dealings. Jurisdiction and venue is declared to be exclusively in Dallas County, in the State of Texas. (Franchise Agreement ¶ 12.10, Compl. Ex. A .)

Plaintiffs filed a Response in opposition to Defendants' Motion. (Pls.' Resp., ECF No. 34.) On September 16, 2009, Defendants filed a Reply in support of their Motion to Dismiss or Transfer. (ECF No. 35.) Oral argument was held on Defendants' Motion on October 30, 2009. (ECF No. 36.) Defendants also filed a Notice of Supplemental Authority Regarding the Motion to Dismiss or Transfer on October 23, 2009. (ECF No. 38.)

II. DISCUSSION

A. Motion to Transfer Venue

1. Legal Standard

A motion to transfer venue is governed by 28 U.S.C. § 1404(a), which provides that "[f]or 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. . . ." A request for transfer under § 1404(a) may be granted when venue is proper in both the original and requested forum. Jumara v. State Farm Ins. Co., 55 F.3d 873, 878 (3d Cir. 1995) (setting forth factors to consider in determining whether transfer is appropriate).*fn2 Under § 1404, the district court has discretion to "adjudicate motions for transfer according to an individualized, case-by-case consideration of convenience and fairness." Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988).

Courts in the Third Circuit consider various private and public interests when determining whether a transfer is proper under § 1404(a). The private interest factors include:

(1) plaintiff's forum preference as manifested in the original choice; (2) the defendant's preference; (3) whether the claim arose elsewhere; (4) the convenience of the parties as indicated by their relative physical and financial condition; (5) the convenience of the witnesses, but only to the extent that the witnesses may actually be unavailable for trial in one of the fora; and (6) the location of books and records. Jumara, 55 F.3d at 879 (citations omitted).

The public interest factors include:

(1) the enforceability of the judgment; (2) practical considerations that could make the trial easy, expeditious, or inexpensive; (3) the relative administrative difficulty in the two fora resulting from court congestion; (4) the local interest in deciding local controversies at home; (5) the public policies of the fora; and (6) the familiarity of the trial judge with the applicable state law in diversity cases.

Id. at 879-80 (citations omitted).

2. Validity of Forum Selection Clause

Before balancing the Jumara factors, we must determine whether the forum selection clause is valid. Federal law governs the evaluation of the forum selection clause in diversity cases. Id. at 877 ("Because questions of venue and the enforcement of forum selection clauses are essentially procedural, rather than substantive, in nature, federal law applies in diversity cases irrespective of [Erie].") (internal quotation marks and citations omitted). A forum selection clause is "prima facie valid and should be enforced unless enforcement is shown . . . to be 'unreasonable' under the circumstances." M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972). A forum selection clause will be found unreasonable "if (1) [it] is the result of fraud or overreaching, (2) its enforcement would violate a strong public policy of the forum, or (3) its enforcement would result ...


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