United States District Court, E.D. Pennsylvania
Complaint in this case seeks a declaratory judgment of no
liability and damages arising out of a dispute over a
personal guaranty. Jurisdiction is based on 28 U.S.C. §
1332 and the Declaratory Judgment Act, 28 U.S.C. §§
2201-2202. Presently before the Court are defendant United
Capital Funding Corp.'s Motion to Transfer Pursuant to 28
U.S.C. § 1404(a), or in the Alternative, to Dismiss
Under the Declaratory Judgment Act and/or Federal Rule
12(b)(6) (Document No. 7, filed July 6, 2016), and
Plaintiff's Motion for Leave to File an Amended Complaint
Pursuant to Fed. R. Civ. P 15(a) (Document No. 8, filed July
20, 2016). Plaintiff's Motion is conditioned on the
granting of United Capital's Motion to Dismiss and does
not seek to amend the Complaint to address issues relevant to
United Capital's Motion to Transfer. Pl.'s Mem. Opp.
one of two concurrent cases in which the parties seek a
determination of Michael Salaman's liability to United
Capital Funding Corp. (“United Capital”) under
the same personal guaranty. The other case, United
Capital Funding Corp. v. Michael Salaman, No.
8:16-cv-1160-T-27TBM, filed in the United States District
Court for the Middle District of Florida (the “Florida
action”), seeks damages under the personal guaranty and
under a contract for factoring services. The primary issue in
both cases at this juncture is determining where the dispute
over Salaman's liability to United Capital should
proceed-the Middle District of Florida or the Eastern
District of Pennsylvania.
Florida action is currently stayed pending this Court's
decision on whether the first-filed rule applies in this
case, which was filed before the Florida action. For the
reasons set forth below, this Court concludes that the
first-filed rule is inapplicable to this case based on the
anticipatory filing exception to the rule. A decision on the
two pending Motions in this Court is deferred until the
District Court for the Middle District of Florida determines
the effect of the Florida forum selection clause in one of
the contracts at issue in that case, but not in the
Pennsylvania case, and the related question of whether the
Florida court has personal jurisdiction over Salaman.
relevant evidence referenced in the Complaint and the
affidavits and exhibits accompanying the parties' briefs
are as follows.
Michael Salaman, a Pennsylvania resident, is the former
president of Skinny Nutritional Corp. (“Skinny”),
a Nevada corporation which sold flavored water. Compl.
¶¶ 1, 6, 15 (Document No. 1, filed Apr. 15, 2016);
Pl.'s Mem. Opp. Mot., Salaman Aff. (“Salaman
Aff.”) ¶¶ 2-3 (Document No. 8, filed July 20,
2016). Defendant United Capital is a Florida corporation that
provides financial services including factoring for accounts
receivable. Compl. ¶¶ 7, 14; Def.'s Mem. Supp.
Mot., Baker Aff. (“Baker Aff.”) ¶ 3
(Document No. 7, filed July 6, 2016).
Complaint in this case (the “Pennsylvania
Complaint”) seeks a declaratory judgment of
Salaman's liability under a personal guaranty executed on
June 7, 2012 (the “Personal Guaranty”). Compl.
¶ 19, Ex. B at 1. In 2012, United Capital asked Salaman
to execute the Personal Guaranty “because Skinny had
insufficient finances for [a] credit extension” of
$300, 000 from United Capital under a promissory note dated
June 6, 2012 (the “Senior Promissory Note”).
Compl. ¶18, Ex. B at 1; Salaman Aff. ¶¶ 32-33.
The Pennsylvania Complaint also alleges that, “at the
same time, ” United Capital and Skinny entered into a
factoring agreement (“the 2012 Factoring
Agreement”). Compl. ¶18. United Capital disputes
the validity of the 2012 Factoring Agreement and correctly
observes that the document attached to the Pennsylvania
Complaint is unsigned and dated April 18, 2014. Def.'s
Mem. Supp. Mot. 4. It is unclear why the 2012 Factoring
Agreement is included in the Pennsylvania Complaint, as there
are no allegations that Salaman signed it or has any
liability under it.
Pennsylvania Complaint, Salaman claims that his obligations
under the Personal Guaranty were discharged by subsequent
agreements and by Skinny's Chapter 11 bankruptcy
proceeding in 2014. Compl. ¶¶ 27, 29, 30, 36, Ex.
D. Salaman also avers that, after Skinny's bankruptcy
proceedings and asset sale to Skinny Nutritional, LLC
(“Skinny LLC”), United Capital entered into
another factoring agreement with Skinny LLC. Compl. ¶
42. According to Salaman, United Capital began to pursue
Salaman for debt owed under the Personal Guaranty after
Skinny LLC “defaulted” on its agreement with
United Capital. Compl. ¶¶ 44-46.
Complaint in the Florida action seeks damages for
Salaman's alleged default on the Personal Guaranty and as
guarantor on a factoring agreement executed in 2007 between
United Capital and Skinny (the “2007 Factoring
Agreement”). Pl.'s Mem. Opp. Mot., Ex. K
(“Florida Compl.”) ¶¶ 9-11, 14-16. The
2007 Factoring Agreement contains a venue and jurisdiction
provision that requires that any suit arising under the
agreement be brought in Florida, “if [United Capital]
so elects.” Id., Ex. A at 12. As part of the
2007 Factoring Agreement, Salaman signed a Validity
Statement, which “irrevocably guarantee[d] . . . the
prompt performance of all obligations of [Skinny] . . . of
every kind and character owed to [United Capital] . . .
.” Id., Ex. A at 16. The parties disagree on
whether the Validity Statement operates as a guaranty for the
2007 Factoring Agreement. Salaman Aff. ¶¶ 24-29;
Baker Aff. ¶ 6.
Capital avers that, on April 7, 2016, it sent two identical
demand letters to Salaman at addresses in Villanova,
Pennsylvania, and Wayne, Pennsylvania, seeking payment for
“past-due amounts” under the 2007 Factoring
Agreement and Personal Guaranty. Baker Aff. ¶ 16;
Def.'s Mem. Supp. Mot., Ex. 7 at 1-2. In those letters,
United Capital demanded that Salaman pay $1, 423, 619.32
within five days of receiving the letters, and stated that if
the payment was not made by that time, United Capital would
“initiate legal action to cover the amount due and
owing.” Id. Salaman received the letter mailed
to the Villanova address on April 11, 2016. Id., Ex.
8 at 1.
April 15, 2016, Salaman filed the above-captioned case (the
“Pennsylvania action”), seeking a declaratory
judgment that he was not liable to United Capital under the
Personal Guaranty, and for damages for fraudulent
misrepresentation and bad faith. Compl. ¶¶ 60,
62-68, 71-72. On April 20, 2016, United Capital filed the
Florida action in Florida state court, and Salaman removed
the Florida action to the United States District Court for
the Middle District of Florida. Florida Compl. at 1; Baker
Aff. ¶ 19.
Capital then filed the pending Motion to Transfer or Dismiss
in the Pennsylvania action. Def.'s Mot. 1. Similarly, in
the Florida action, Salaman has filed a Motion to Dismiss for
Lack of Personal Jurisdiction or in the Alternative to