throbber
Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 1 of 7
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF PENNSYLVANIA
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`This is a copyright infringement action in which the principal issue before me is whether
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`the defendant may invoke, as the basis for a motion to transfer, a forum selection clause in
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`contracts to which the plaintiff is not a party. I conclude that the answer is no—particularly
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`since the plaintiff has not asserted any claims for breach of contract, but has limited himself to
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`the protections of the federal Copyright Act.
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`Bob Krist, a Bucks County professional photographer, has sued the educational-textbook
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`publisher Pearson Education, Inc., for one count of copyright infringement embracing 359
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`separate claims. Krist’s theory for each claim is that although Pearson had licenses for Krist’s
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`photographs, it used them in ways those licenses did not authorize. Only seven claims, however,
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`involve licenses Krist issued directly to Pearson. The remaining 352 involve licenses that Krist
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`first issued to the stock photography agency Corbis Corporation, under agreements allowing
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`Corbis to sublicense Krist’s photographs to third parties. Pearson, which has long had
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`agreements with Corbis allowing it to use Corbis photographs, was one such third party. Pearson
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`both accessed and used Krist’s photographs under the terms of the Pearson–Corbis contracts—
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`until, as Krist claims here, it began using them outside the terms of those contracts. Pearson now
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`1
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`BOB KRIST,
`Plaintiff,
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`v.
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`PEARSON EDUCATION, INC.,
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`Defendant.
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`MCHUGH, J.
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`:
` :
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`:
`:
`:
`:
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`CIVIL ACTION
`NO. 16-6178
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` APRIL 12, 2017
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`MEMORANDUM
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 2 of 7
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`moves under 28 U.S.C. § 1404(a) to transfer venue to the Southern District of New York, relying
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`on the following forum selection clause in the Pearson–Corbis agreements:
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`Choice of Law / Jurisdiction / Attorneys’ Fees: Any dispute regarding
`this Agreement shall be governed by the laws of the State of New York
`and Titles 15, 17, and 35 of the U.S.C., as amended, and the parties agree
`to accept the exclusive jurisdiction of the state and federal courts located
`in New York, USA, regardless of conflicts of laws.
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`It is undisputed that Krist was not a party to those agreements, but Pearson argues he should
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`nonetheless be bound by their terms.1
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`I start with two default premises. First, “a plaintiff’s choice of forum should rarely be
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`disturbed.” Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 (1981); accord Jumara v. State Farm
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`Ins. Co., 55 F.3d 873, 879 (3d Cir. 1995). Second, where the plaintiff has chosen his home
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`forum, that choice is “entitled to greater deference.” Piper, 454 U.S. at 255 (citing Koster v.
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`(Am.) Lumbermens Mut. Cas. Co., 330 U.S. 518, 524 (1947)). To be sure, the “calculus changes
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`. . . when the parties’ contract contains a valid forum-selection clause.” Atl. Marine Constr. Co.
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`v. U.S. Dist. Court, 134 S. Ct. 568, 581 (2013). If such a clause exists, barring “extraordinary
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`circumstances,” the court should ordinarily enforce the clause and transfer the case. Id. But
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`before placing Atlantic Marine’s heavy thumb on the scale, there must exist a contract between
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`the parties—or, in lieu of that, some reason why a nonparty to the contract should nevertheless
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`be bound by it.
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`Pearson advances three reasons why Krist should be bound by the Pearson–Corbis
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`contracts. First, Krist has brought suit based on the licenses granted in those contracts. Second,
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`Krist is both closely related to and a beneficiary of the contracts. And finally, Krist authorized
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`Corbis to act as his agent in entering into the contracts. Pearson claims these factors, either
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`1 This was an issue I did not need to reach in Eastcott v. McGraw–Hill Global Education
`Holdings, LLC, No. 16-904, 2016 WL 3959076 (E.D. Pa. July 22, 2016). See id. at *2 n.2.
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`
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`2
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 3 of 7
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`individually or in combination, place the contracts at the heart of this case—and since those
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`contracts provide that any dispute “regarding” them must be litigated in New York, I must
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`transfer the case there.
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`Though Pearson raises colorable arguments, I am not persuaded to enforce the forum
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`selection clause against Krist.2 Significantly, Krist has not asserted any rights under the
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`contracts, making some of the cases on which Pearson relies readily distinguishable. See Jon
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`Feingersh Photography, Inc. v. Houghton Mifflin Harcourt Publ’g Co., No. 13-2378, 2014 WL
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`716723 (E.D. Pa. Feb. 25, 2014) (Slomsky, J.); Lefkowitz v. John Wiley & Sons, Inc., No. 13-
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`1662, 2013 WL 4079923 (E.D. Pa. Aug. 13, 2013) (Baylson, J.); Lefkowitz v. McGraw–Hill
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`Cos., No. 13-1661, 2013 WL 3061549 (E.D. Pa. June 19, 2013) (Schiller, J.). In those cases,
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`where the Corbis clause was enforced against nonsignatory plaintiffs, my colleagues put special
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`emphasis on the fact that the plaintiffs sued as beneficiaries of the contracts; there is an inherent
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`unfairness in allowing a nonparty to a contract to sue under it without being held to its terms.
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`2 There is a threshold question unaddressed by the parties: What law applies? It is true
`that federal law, specifically § 1404(a), governs my decision of whether and how to give effect to
`a valid forum selection clause. Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 32 (1988). But
`the step before that requires interpreting the clause to determine whether it even applies to a
`nonsignatory. Since the “question of the scope of a forum selection clause is one of contract
`interpretation,” John Wyeth & Brother Ltd. v. Cigna Int’l Corp., 119 F.3d 1070, 1073 (3d Cir.
`1997) (Alito, J.), this would seem to be an issue of state law—something all the more true
`because the Pearson–Corbis contracts specify that they shall be interpreted under New York law.
`And looking to state law makes good sense, given that “[t]he interpretation of forum selection
`clauses in commercial contracts is not an area of law that ordinarily requires federal courts to
`create substantive law.” Gen. Eng’g Corp. v. Martin Marietta Alumina, Inc., 783 F.2d 352, 357
`(3d Cir. 1986); see also Carlyle Inv. Mgmt. LLC v. Moonmouth Co. SA, 779 F.3d 214, 218–19
`(3d Cir. 2015) (applying Delaware law to interpret the scope of a forum selection clause in a
`Delaware contract).
`Here, because both Pearson and Krist have briefed this motion on general contract law
`principles and rely primarily on federal cases, I will follow their lead. Cf. Wyeth, 119 F.3d at
`1074 (applying general principles to an English contract where the “parties . . . ma[d]e little
`reference to English contract law”). But these are New York contracts, meaning “questions of
`New York law are likely to be relevant to the[ir] interpretation.” Pearson Br. 12. So, where
`appropriate, I also rely on New York law.
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`3
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 4 of 7
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`This case, however, features only copyright claims. And though the Third Circuit has cautioned
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`that “pleading alternate non-contractual theories is not alone enough to avoid a forum selection
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`clause if the claims asserted arise out of the contractual relation and implicate the contract’s
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`terms,” Crescent Int’l, Inc. v. Avatar Cmtys., Inc., 857 F.2d 943, 944 (3d Cir. 1988) (per curiam)
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`(emphasis added), that rule has no applicability where there is no contract between the parties.3
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`I take Pearson’s point that this case will involve consideration of the Corbis–Pearson
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`contracts, because Krist claims they did not authorize Pearson’s uses of his photographs. So in
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`one sense, it can be said that this suit, though brought in copyright, does “regard[]” the
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`contracts.4 But that matter is distinct from whether Krist is bound by a forum selection clause in
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`contracts he did not sign. In this respect, it is notable that though the choice of law clause
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`broadly provides that “[a]ny dispute regarding this Agreement” shall be governed by New York
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`(and relevant federal) law, the forum selection clause begins with: “the parties agree.” It is
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`indisputable that Krist was not a party and did not so agree.
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`Pearson also claims that Krist is closely related to, and a beneficiary of, the contracts,
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`making him bound. Both concepts have been applied as exceptions to the general rule that a
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`contract only binds its parties. See Coastal Steel Corp. v. Tilghman Wheelabrator Ltd., 709 F.2d
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`3 Similarly, another case cited by Pearson, Gordon v. Houghton Mifflin Harcourt
`Publishing Co., No. 14-4703, 2015 WL 3871788 (E.D. Pa. June 23, 2015) (Restrepo, J.), has
`little to offer here, as the forum selection clause there was in a contract signed by both parties.
`4 Pearson also argues that a forum selection clause that applies to disputes that “regard”
`or “relate to” the underlying contract (versus a clause that uses language like “arise out of”)
`should be read broadly. See, e.g., Flanagan v. Prudential–Bache Sec., 495 N.E.2d 345, 350
`(N.Y. 1986). This argument has not always prevailed in cases involving the Corbis clauses. See,
`e.g., Steinmetz v. McGraw–Hill Global Educ. Holdings, LLC, ___ F. Supp. 3d ____, No. 15-
`6600, 2016 WL 7048951, at *6–7 (E.D. Pa. Dec. 5, 2016); Light v. Taylor, No. 05-5003, 2007
`WL 274798, at *6 (S.D.N.Y. Jan. 29, 2007), aff’d, 317 F. App’x 82 (2d Cir. 2009). Though in
`an analogous context the Third Circuit has read a similar clause to apply where the underlying
`contract would serve not as a claim but as a defense, see Wyeth, 119 F.3d at 1074–75, I do not
`find that controlling here.
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`
`
`4
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 5 of 7
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`190, 202–03 (3d Cir. 1983), abrogated on other grounds by Lauro Lines s.r.l. v. Chasser, 490
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`U.S. 495 (1989); Freeford Ltd. v. Pendleton, 857 N.Y.S.2d 62, 67 (App. Div. 2008). But the
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`cases on which Pearson primarily relies, Synthes, Inc. v. Emerge Med., Inc., 887 F. Supp. 2d 598
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`(E.D. Pa. 2012) (Buckwalter, J.); Greenfish II, L.P., ex rel. Purplefish, LLC v. Int’l Portfolio, No.
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`11-7628, 2012 WL 3024759 (E.D. Pa. July 24, 2012) (Goldberg, J.); First Fin. Mgmt. Grp., Inc.
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`v. Univ. Painters of Balt., Inc., No. 11-5821, 2012 WL 1150131 (E.D. Pa. Apr. 5, 2012)
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`(Baylson, J.); Affiliated Mortg. Prot., LLC v. Tareen, No. 06-4908, 2007 WL 203947 (D.N.J.
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`Jan. 24, 2007), all share a crucial difference from this one: the nonsignatories there were
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`defendants who allegedly either interfered with (as in Synthes, First Financial, and Affiliated
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`Mortgage), or made misrepresentations to induce entering into (as in Greenfish), contracts with
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`forum selection clauses. Each case centered on some mix of claims for breach of contract, fraud,
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`or tortious interference. With such allegations, those courts found it reasonable to hold
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`nonsignatory defendants to the contracts’ forum selection clauses. But this case is different:
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`Krist, the plaintiff, brings only copyright claims, and Pearson alleges no wrongful conduct on his
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`part.
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`Finally, Pearson argues the clause is enforceable against Krist because Corbis entered
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`into the contracts with Pearson as Krist’s agent. Other courts have found (or at least assumed)
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`that Corbis representation agreements like those here have created principal–agent relationships.
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`See Yamashita v. Scholastic, Inc., No. 16-3839, 2016 WL 6897781, at *2 (D.N.J. Nov. 21,
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`2016); Sohm v. McGraw–Hill Global Educ. Holdings, LLC, No. 16-1316, slip op. at 5 (C.D. Cal.
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`June 6, 2016) (Dkt. 45-1). But I find that Corbis and Krist did not enter into such a relationship,
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`because the representation agreements between them did not give Krist continued control or
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`direction over Corbis.
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`5
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 6 of 7
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`The Restatement (Second) of Agency—which New York courts appear to follow, see,
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`e.g., Sokoloff v. Harriman Estates Dev. Corp., 754 N.E.2d 184, 188–89 (N.Y. 2001)—makes
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`clear that a principal–agent relationship “depends upon . . . the understanding of the parties that
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`the principal is to be in control of the undertaking.” § 1 cmt. (1)b (Am. Law Inst. 1958). Such a
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`relationship therefore is created “only if . . . the fiduciary is subject to the directions of the one on
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`whose account he acts.” Id. Indeed, “[i]t is the element of continuous subjection to the will of
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`the principal which distinguishes the agent from other fiduciaries[.]” Id. So while in certain
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`circumstances an independent contractor—that is, a “person[] who contract[s] to do something
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`for another but who [is] not [a] servant[]”—may be an agent, the threshold question remains
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`whether that contractor cedes “direction over the conduct of the work.” Id. § 2 cmt. b. If he does
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`not, he is not an agent—and so he “has no power to make the one employing him a party to a
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`transaction.” Id.
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`On this the Corbis–Krist agreements were clear: Krist did not retain continued control or
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`direction over Corbis.5 Those agreements provided: “Corbis may accept or reject submitted
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`Content for representation under this Agreement in its sole discretion” (§ 1), and “Corbis may
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`determine at our sole discretion the terms and conditions of any license, marketing, or
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`distribution of your Accepted Content” (§ 8). This level of latitude given to Corbis—and the
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`lack of continued control or direction by Krist that it necessarily implies—undercuts any claim
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`that these agreements created a principal–agent relationship, at least insofar as they gave Corbis
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`the ability to bind Krist to the Pearson–Corbis contracts. This conclusion finds further support in
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`a separate clause (§ 17) in the Corbis–Krist agreements that granted Corbis authority to act as
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`5 It is true, as Pearson points out, that the sample Corbis–Krist agreement that Krist
`attaches to his opposition (Dkt. 13-1 Ex. 1) was signed in 2013, whereas Krist’s claims here
`involve photographs he licensed to Corbis between 2005 and 2012. But the 2013 agreement
`appears to be a standard Corbis contract: the bottom corner of it reads “Version: March 2009.”
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`6
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`

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`Case 2:16-cv-06178-GAM Document 15 Filed 04/12/17 Page 7 of 7
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`Krist’s agent for the limited “purpose of making [certain] settlements and collections.” Because
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`contracts should generally be interpreted to avoid surplusage, see In re Viking Pump, Inc., 52
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`N.E.3d 1144, 1151 (N.Y. 2016), § 17 would have been unnecessary if the agreements had
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`created an agency relationship as a general rule.
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`Ultimately, Pearson, as the moving party, has not persuaded me that the forum selection
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`clause is enforceable against Krist. Even though this is a case where reasonable minds could
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`differ,6 I have not been given a sufficient reason to hold Krist to a clause in contracts he never
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`signed—especially since “in New York, an ambiguous contract usually is construed most
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`strongly against the drafter when the other party has had no voice in the preparation,” Hatco
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`Corp. v. W.R. Grace & Co.–Conn., 59 F.3d 400, 406 (3d Cir. 1995) (citing Jacobson v.
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`Sassower, 489 N.E.2d 1283, 1284 (N.Y. 1985)). This remains a case brought in copyright, not
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`contract. Krist is not obligated to assert every claim the law allows, and Pearson is not entitled to
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`litigate a case that Krist did not bring.
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`With the forum selection clause—and Atlantic Marine’s presumption of transfer—set
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`aside, I rather easily conclude that Pearson’s motion to transfer will be denied. None of the
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`factors set forth in § 1404(a) (the convenience of parties or witnesses, or the interests of justice),
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`as expanded upon in Jumara, favors transfer. Indeed, Pearson has made no affirmative argument
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`for transfer other than the forum selection clause. An appropriate order follows.
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` /s/ Gerald Austin McHugh
`United States District Judge
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`6 Members of this Court are divided on this precise issue. In virtually identical cases,
`Judge Slomsky has enforced the clause against a nonsignatory, see Keller v. McGraw–Hill
`Global Educ. Holding, LLC, No. 16-1778, 2016 WL 4035613 (E.D. Pa. July 28, 2016), while
`Judge Robreno has not, see Steinmetz, 2016 WL 7048951.
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`7
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`

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