Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 1 of 12 PageID #: 110
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF PENNSYLVANIA
`
`
`EISAMAN CONTRACT ASSOCS., INC., )
`
`
`
`
`
`
`)
`
`
`Plaintiff,
`
`
`)
`
`
`
`
`
`
`)
`
`v.
`
`
`
`
`)
`
`
`
`
`
`
`)
`SMITH SYS. MFG., CO.,
`
`)
`
`
`
`
`
`
`)
`
`
`Defendant.
`
`
`)
`
`
`
`No. 2:17-cv-00061-RCM
`
`Magistrate Judge Robert C. Mitchell
`
`
`
`MEMORANDUM OPINION
`
`Introduction
`
`Presently before the Court is a Rule 12(b)(6) motion (Docket No. 9) brought by
`
`I.
`
`
`
`Defendant Smith Systems Manufacturing (“Smith”). The Plaintiff, Eisaman Contract Associates
`
`(“Eisaman”), filed a breach-of-contract action pursuant to the Court’s diversity jurisdiction
`
`against Smith. Smith brings his Rule 12(b)(6) motion (Docket No. 9) to enforce a
`
`forum-selection clause. This clause requires “any litigation of lawsuits between the parties” to
`
`“be filed in Collin County, Texas.” (Docket No. 16-2 ¶ 18.1). After reviewing the parties’
`
`materials and the applicable law, the Court finds that Eisaman and Smith agreed to a contract
`
`containing a valid forum-selection clause. For the reasons set forth below, Smith’s Rule 12(b)(6)
`
`motion will be denied as moot and this action will be transferred sua sponte to the United States
`
`District Court for the Eastern District of Texas Sherman Division’s (“Eastern District Sherman
`
`Division”) Plano, Texas courthouse, which sits in Collin County, Texas. 28 U.S.C. § 124(c)(3).
`
`
`
`
`
`II.
`
`A.
`
`Background
`
`Facts
`
`Eisaman is a Pennsylvania corporation based in Pittsburgh, Pennsylvania; Smith is a
`
`Texas corporation located in Plano, Texas. (Docket No. 1 ¶¶ 4–5). Eisaman, a furniture
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 2 of 12 PageID #: 111
`
`manufacturer representative, contracted in January 1991 with Smith, a school furniture
`
`manufacturer, to represent Smith’s products in upstate and western New York, West Virginia,
`
`and Pennsylvania. (Id. ¶¶ 6–8). Eisaman and Smith amended the January 1991 contract in
`
`January 2007, broadening Eisaman’s duties to the metropolitan New York City area (including
`
`Long Island, five boroughs, Westchester City) and Northern New Jersey while leaving the
`
`January 1991 contract’s other terms unaltered. (Id. ¶ 9). Eisaman contends Smith breached their
`
`agreement, causing at least $660,000 in damages for owed and future commissions. (Id. ¶¶ 10–
`
`11, 15–16). Eisaman did not attach a copy of the contract to any of its docket entries.
`
`
`
`Smith provided a copy of this contract. It shows two dates: January 31, 2003 (typed) and
`
`November 12, 2006 (appears to be time stamped at the top of each page). (Docket No. 16-1
`
`at 5–15). Smith and Eisaman executed the contract.1 (Id. at 15). The contract contains a
`
`forum-selection clause stating that “[a]ny litigation of lawsuits between the parties hereto shall
`
`be filed in Collin County, Texas.” (Docket No. 9-1 ¶ 18.1). The parties agreed “that all prior
`
`agreements and arrangements of any kind between [them] . . . are hereby terminated and of no
`
`force and effect . . . .” (Id. ¶ 13.1). A merger clause is also present; it states that “this
`
`Agreement constitutes the entire agreement between the Parties with respect to the subject matter
`
`hereof.” (Id. ¶ 17). Texas law applies. (Id. ¶ 18.1).
`
`
`
`B.
`
`Procedural Posture
`
`
`
`Smith filed a Rule 12(b)(6) motion to dismiss with a brief in support. (Docket Nos. 9,
`
`10). Eisaman submitted an opposition brief (Docket No. 14) that Smith replied to. (Docket
`
`1 Smith attached three copies of its contract with Eisaman to docketed materials. The two copies
`attached to Smith’s reply brief are the same and include the parties’ signature page. (Docket
`Nos. 16-1 at 5–15; 16-2 at 3–13). The copy attached to Smith’s motion to dismiss lacks the
`parties’ signature page but contains the same terms as the two copies attached to Smith’s reply
`brief. (Docket No. 9-1 at 5–20). Also, the copy attached to Smith’s motion to dismiss contains
`addendum pages signed by Eisaman. (Id. at 15–20).
`
`
`
`2
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 3 of 12 PageID #: 112
`
`No. 16). Both parties consented to the undersigned’s jurisdiction over this action. (Docket
`
`Nos. 13, 15).
`
`III.
`
`Standards of Review
`
`
`
`This case presents a non-typical scenario: a defendant moving for dismissal under Rule
`
`12(b)(6) to enforce a forum-selection clause. (Docket No. 10 at 1). Moving for Rule 12(b)(6)
`
`dismissal is permissible to enforce a valid forum-selection clause. Salovaara v. Jackson Nat’l
`
`Life Ins. Co., 246 F.3d 289, 298 (3d Cir. 2001). “When only a 12(b)(6) motion to dismiss is
`
`filed . . . th[e] court has the power to dismiss the action . . . without considering the possibility of
`
`transfer to another federal forum.” Kahn v. Am. Heritage Life Ins. Co., No. 06-1832, 2006 WL
`
`1879192, at *7 (E.D. Pa. June 29, 2006) (citing Salovaara, 246 F.3d at 298–99). But the United
`
`States Court of Appeals for the Third Circuit (“Third Circuit”) acknowledged that “it makes
`
`better sense[] when venue is proper but the parties have agreed upon a not-unreasonable
`
`forum[-]selection clause . . . to transfer rather than dismiss.” Salovaara, 246 F.3d at 299.2
`
`Indeed, a district court is not precluded “from sua sponte considering whether transfer is the
`
`better course.” Kahn, 2006 WL 1879192, at *7 (citing Salovaara, 246 F.3d at 299). If a district
`
`court sua sponte considers transfer, when venue is proper in the transferor and transferee forums,
`
`2 The Supreme Court in Atl. Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex., 134
`S. Ct. 568, 581 (2013), held that a motion to transfer under 28 U.S.C. § 1404(a) will almost
`always be granted when the parties agreed to a valid forum-selection clause. Atl. Marine did not
`consider whether a defendant could move for dismissal under Rule 12(b)(6) to enforce a
`forum-selection clause. Id. at 581. Of the federal appellate courts to consider this question
`post-Atl. Marine, two continue to allow parties to use Rule 12(b)(6) motions to dismiss cases
`brought in federal forums not delineated in valid forum-selection clauses. Claudio-de Leon v.
`Sistema Universitario Ana G. Mendez, 775 F.3d 41, 46 (1st Cir. 2014) (quoting Rivera v. Centro
`Medico de Turabo, Inc., 575 F.3d 10, 15 (1st Cir. 2009)); Podesta v. Hanzel, No. 15-3372, 2017
`WL 1135696, at *2 (3d Cir. Mar. 27, 2017) (not precedential). One federal appellate court
`seemingly criticized the use of Rule 12(b)(6) to dislodge cases from improper forums in light of
`Atl. Marine. Weber v. PACT XPP Techs., AG, 811 F.3d 758, 768 n.11 (5th Cir. 2016) (“The
`First Circuit apparently has determined that its previous approach therefore remains valid despite
`Atlantic Marine’s exhortations in favor of the [forum non conveniens § 1404(a)] analysis.”).
`
`
`
`3
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 4 of 12 PageID #: 113
`
`the district court must apply a factor analysis contained in 28 U.S.C. § 1404(a). Jumara v. State
`
`Farm Ins. Co., 55 F.3d 873, 878 (3d Cir. 1995).
`
`A.
`
`Rule 12(b)(6)
`
`
`
`Courts should assume the veracity of well-pleaded factual allegations. Malleus v.
`
`George, 641 F.3d 560, 563 (3d Cir. 2011) (citing Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)).
`
`When deciding a Rule 12(b)(6) motion to dismiss, a federal court may consider “only the
`
`allegations in the complaint, exhibits attached to the complaint, matters of public record, and
`
`documents that form the basis of a claim.” Lum v. Bank of Am., 361 F.3d 217, 222 n.3 (3d Cir.
`
`2004). “A document forms the basis of a claim if it is ‘integral to or explicitly relied upon in the
`
`complaint.’” Gross v. Stryker Corp., 858 F. Supp. 2d 466, 477 (W.D. Pa. 2012) (quoting In re
`
`Rockefeller Ctr. Props., Inc. Sec. Litig., 184 F.3d 280, 287 (3d Cir. 1999) (emphasis omitted;
`
`internal citations and quotations omitted)). The contract between Eisaman and Smith that Smith
`
`attached to its motion to dismiss and its reply brief appears to be the one Eisaman’s complaint
`
`refers to, though the dates are different.3 (Docket Nos. 1 ¶¶ 6–9; 9-1 at 5–20; 16-1 at 5–15; 16-2
`
`at 3–13). The contract copies Smith attached to its materials will be considered for purposes of
`
`this motion.
`
`
`
`The Court “need not accept allegations that are internally inconsistent . . . .” Amelio v.
`
`McCabe, Weisberg & Conway, P.C., No. 14-1611, 2015 WL 4545299, at *4 (July 28, 2015);
`
`(citing Kaempe v. Myers, 367 F.3d 958, 963 (D.C. Cir. 2004)).
`
`
`
`
`3 The date discrepancy does not show that the contract Eisaman’s complaint refers to is different
`than the contract Smith attached to its materials. See infra Part IV.A.
`4
`
`
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 5 of 12 PageID #: 114
`
`B.
`
`28 U.S.C. § 1404(a)
`
`
`
`Before determining whether transfer is warranted under 28 U.S.C. § 1404(a), a court
`
`should decide whether any forum-selection clauses at issue are valid. Knopick v. UBS AG, 137
`
`F. Supp. 3d 728, 732 (M.D. Pa. 2015).
`
`
`
`Section 1404(a) of Title 28 of the United States Code 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 . . . .” 28 U.S.C.
`
`§ 1404(a). Transferring a case usually requires three steps: (1) determine whether the proposed
`
`transferee court is a venue where the action “might have been brought” under the federal venue
`
`statute; (2) evaluate the relevant “private factors” relating to “the convenience of parties and
`
`witnesses”; and (3) examine the “public factors” relating to “the interest of justice” and weigh
`
`them to determine if the action should be transferred. Shutte v. Armco Steel Corp., 431 F.2d 22,
`
`24–25 (3d Cir. 1970); Jumara, 55 F.3d at 879. See In re Volkswagen of America, Inc., 545 F.3d
`
`304, 312, 314 (5th Cir. 2008) (en banc).
`
`
`
`The Section 1404(a) analysis changes if the parties agreed to a valid forum-selection
`
`clause. “When the parties have agreed to a valid forum-selection clause, a district court should
`
`ordinarily transfer the case to the forum specified in that clause. Only under extraordinary
`
`circumstances unrelated to the convenience of the parties should a § 1404(a) motion be denied.”
`
`Atl. Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex., 134 S. Ct. 568, 581 (2013).
`
`Atlantic Marine required district courts to change their typical § 1404(a) analysis in three
`
`respects. “First, the plaintiff’s choice of forum merits no weight.” Id. Second, district courts
`
`“must deem the private-interest factors to weigh entirely in favor of the preselected forum” when
`
`the parties agree to a forum-selection clause. Id. at 582. “As a consequence, a district court may
`
`consider arguments about public-interest factors only.” Id. “Forum-selection clauses should
`5
`
`
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 6 of 12 PageID #: 115
`
`control except in unusual cases.” Id. “Third, when a party bound by a forum-selection clause
`
`flouts its contractual obligation and files suit in a different forum, a § 1404(a) transfer of venue
`
`will not carry with it the original venue’s choice-of-law rules.” Id. If “a transfer stems from
`
`enforcement of a forum-selection clause: [t]he court in the contractually selected venue should
`
`not apply the law of the transferor venue to which the parties waived their right.” Id. at 583.
`
`IV. Discussion
`
`A.
`
`Eisaman and Smith Made a Contract
`
`
`
`Before analyzing whether the parties agreed to a valid forum-selection clause, the Court
`
`will first show that Eisaman and Smith entered into the contract containing the forum-selection
`
`clause at issue. Eisaman contends that a January 1991 contract (amended in January 2007) is a
`
`different contract than the one Smith appended to its motion to dismiss, which is dated either
`
`January 31, 2003 (typed) or November 12, 2006 (appears to be time stamped at the top of each
`
`page). (Docket Nos. 1 ¶¶ 6–9; 9-1 at 5–20; 16-1 at 5–15). Eisaman then highlighted that the
`
`contract accompanying Smith’s motion to dismiss lacked the parties’ signatures. Eisaman hopes
`
`to show that it is not bound to the contract (and thus the forum-selection clause) that Smith
`
`points to and instead emphasizes the continuing vitality of a purported January 1991 agreement it
`
`has not yet produced. Eisaman’s arguments fall flat.
`
`
`
`First, the plain language of the contract at issue forecloses any possibility that an earlier
`
`agreement (the purported January 1991 agreement including a January 2007 amendment) defines
`
`Eisaman’s and Smith’s business relations. Contract integration is a question of law. Gianni v. R.
`
`Russell & Co., 126 A. 791, 792 (Pa. 1924). If a document is “‘couched in such terms as import a
`
`complete legal obligation,’” it presumably contains the parties’ entire agreement. Id. (quoting
`
`Seitz v. Brewers’ Refrigerating Mach. Co., 141 U.S. 510, 517 (1891)). Paragraph 13.1 provides
`
`“that all prior agreements and arrangements of any kind between [Eisaman and Smith] . . . are
`
`
`
`6
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 7 of 12 PageID #: 116
`
`hereby terminated and of no force and effect . . . .” (Docket No. 16-1 ¶ 13.1). Paragraph 17
`
`contains a merger clause; it states that “this Agreement constitutes the entire agreement between
`
`the Parties with respect to the subject matter hereof.” (Id. ¶ 17). The language in paragraphs
`
`13.1 and 17 indicate that the parties fully integrated the contract at issue. Even if Eisaman and
`
`Smith signed a contract in January 1991, that contract has no bearing on this action based on the
`
`plain language of the present contract. (Id. at 5–15). Eisaman also does not allege that the
`
`January 1991 agreement was made with separate consideration or argues that it would “naturally
`
`be made as a separate agreement” such that it would be immune to integration. Harrison v.
`
`Soffer, 289 A.2d 752, 755 (Pa. Super. Ct. 1972) (internal quotation marks omitted). Further,
`
`there is no allegation that a purported January 2007 amendment eliminated or altered the
`
`forum-selection clause currently before the Court.
`
`
`
`Second, Eisaman and Smith executed the present contract. Smith attached a version of
`
`the contract containing a signature page to its reply brief. (Docket No. 16-1 at 5–15). Both
`
`parties’ signatures appear on the signature page. (Id. at 15). Considering that the terms in the
`
`documents attached to Smith’s motion to dismiss and reply brief match and are about a similar
`
`subject matter to the purported January 1991 contract (Eisaman acting as a sales representative
`
`for Smith), Eisaman and Smith are bound by the contract at issue, including its forum-selection
`
`clause. (Docket Nos. 1 ¶¶ 6–9; 9-1 at 5–20; 16-1 at 5–15).
`
`B.
`
`Eisaman’s and Smith’s Contract Contains a Valid Forum-Selection Clause
`
`
`
`The parties’ contract includes a valid forum-selection clause. It requires that “[a]ny
`
`litigation of lawsuits between the parties hereto shall be filed in Collin County, Texas.” (Docket
`
`No. 9-1 ¶ 18.1). In a diversity case, federal law determines a forum-selection clause’s validity.
`
`Jumara, 55 F.3d at 877–78 (citing Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 32 (1988)).
`
`Interpreting and enforcing forum-selection clauses are pure issues of law. Salovaara, 246 F.3d
`7
`
`
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 8 of 12 PageID #: 117
`
`at 295. Forum-selection clauses are presumed valid unless the resisting party shows the clause’s
`
`enforcement to be unreasonable. The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972);
`
`Foster v. Chesapeake Ins. Co., 933 F.2d 1207, 1219 (3d Cir. 1991). Enforcing a forum-selection
`
`clause is unreasonable if it: (1) was procured through fraud or overreaching; (2) “would
`
`contravene a strong public policy of the forum in which suit is brought, whether declared by
`
`statute or by judicial decision”; and (3) prescribes a forum that is “seriously inconvenient for the
`
`trial of the action.” The Bremen, 407 U.S. at 15–16 (emphasis removed). The party trying to
`
`duck the forum-selection clause receives the burden to show its unreasonableness. Carnival
`
`Cruise Lines, Inc. v. Shute, 499 U.S. 585, 592 (1991).
`
`
`
`Here, Eisaman does not even attempt to meet its burden to show that the forum-selection
`
`clause is invalid. It did not allege that the forum-selection clause arose through any fraud or
`
`overreaching. As for the forum’s public-policy concerns, the Pennsylvania Supreme Court
`
`presumes that forum-selection clauses are valid, enforcing them “when the parties have freely
`
`agreed that litigation shall be conducted in another forum and where such agreement is not
`
`unreasonable at the time of litigation.” Central Contracting Co. v. C.E. Youngdahl & Co., 209
`
`A.2d 810, 816 (Pa. 1965). A forum-selection clause is unreasonable if it “seriously impair[s] [a
`
`party’s] ability to pursue his cause of action.” Id. “Mere inconvenience or additional expense is
`
`not the test of unreasonableness since it may be assumed that [the party] received under the
`
`contract consideration for these things.” Id. Eisaman also did not show how litigation in Collin
`
`County, Texas would be too inconvenient for trial. Though Eisaman is a Pittsburgh,
`
`Pennsylvania corporation, Smith is a Plano, Texas corporation within Collin County, Texas.
`
`(Docket No. 1 ¶¶ 4–5). While Collin County lies far southwest of Pittsburgh, Eisaman and
`
`Smith are not “resolv[ing] their essentially local disputes in a remote alien forum.” The Bremen,
`
`
`
`8
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 9 of 12 PageID #: 118
`
`407 U.S. at 17. The forum-selection clause instead mandates that “any litigation” occur in
`
`“Collin County, Texas”—Smith’s backyard. (Docket No. 9-1 ¶ 18.1). According to the
`
`Pennsylvania Supreme Court, “[i]f the agreed upon forum is available to [a party] and said forum
`
`can do substantial justice to the cause of action then [that party] should be bound by his
`
`agreement.” Central Contracting, 209 A.2d at 816. Eisaman does not argue that a court in
`
`Collin County—state or federal—is not available for litigation or is unable to do substantial
`
`justice in this matter. Therefore, the forum-selection clause is valid.
`
`C.
`
`Venue is Proper in the Western District and the Eastern District Sherman
`Division
`
`
`
`The Court may analyze Section 1404(a)’s public-interest factors because venue is proper
`
`in this district and the Eastern District Sherman Division. A federal court must apply Section
`
`1404(a)’s factor analysis when venue is proper in the transferor and transferee forums. Jumara,
`
`55 F.3d at 878. Venue is proper in “a judicial district in which a substantial part of the events . . .
`
`giving rise to the claim occurred” and part of the territory Smith assigned Eisaman to cover
`
`includes the Western District. 28 U.S.C. § 1391(b)(2); (Docket No. 16-1 at 14). Venue is also
`
`proper in “a judicial district in which any defendant resides, if all defendants are residents of the
`
`State in which the district is located.” 28 U.S.C. § 1391(b)(1). Smith is the only defendant and it
`
`is located in Plano, Texas, which is under the Eastern District Sherman Division’s jurisdiction.
`
`Therefore, the parties may properly lay jurisdiction in the Western District or the Eastern District
`
`Sherman division. This permits a Section 1404(a) factor analysis.
`
`9
`
`
`
`
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 10 of 12 PageID #: 119
`
`D.
`
`Analyzing Section 1404(a)’s Public-Interest Factors Pursuant to Atlantic
`Marine
`
`
`
`Eisaman failed to show that it would be unwarranted to transfer its action to a federal
`
`court in Collin County, Texas.4 Before considering the public-interest factors, this Court must
`
`determine that the destination forum—the Eastern District Sherman Division—is an adequate
`
`alternative. Knopick, 137 F. Supp. 3d at 736 (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235,
`
`254 (1981)). Eisaman did not contest the adequacy of alternative forums. The Court has no
`
`reason to doubt the adequacy of the Eastern District Sherman Division. See supra Part IV.B.
`
`Therefore, it is an adequate alternative forum.
`
`
`
`The Court next considers Section 1404(a)’s public-interest factors as delineated in case
`
`law. Atlantic Marine laid these factors out in a footnote: “the administrative difficulties flowing
`
`from court congestion; the local interest in having localized controversies decided at home; [and]
`
`the interest in having the trial of a diversity case in a forum that is at home with the law.” 134 S.
`
`Ct. 581 n.6 (quoting Piper Aircraft, 454 U.S. at 241 n.6 (internal quotation marks omitted)).
`
`Eisaman, “as the party defying the forum-selection clause, . . . bears the burden of establishing
`
`that transfer . . . is unwarranted.” Atl. Marine, 134 S. Ct. at 581.
`
`
`
`The public-interest factors favor transfer to the Eastern District Sherman Division.
`
`Eisaman did not make any arguments regarding administrative difficulties in the Eastern District
`
`Sherman Division as compared to the Western District. Moreover, “[c]ourt congestion is not a
`
`decisive factor; it must be weighed against all other relevant factors, and district courts within the
`
`Third Circuit have not placed great importance on this factor.” York Group, Inc. v. Pontone,
`
`
`4 The court recognizes that its sua sponte consideration of transfer in this case may have caught
`Eisaman off guard. However, Smith applied Section 1404(a)’s public-interest factors in its brief
`supporting its Rule 12(b)(6) motion to dismiss. (Docket No. 10 at 8–10). Eisaman did not
`address Section 1404(a)’s public-interest factors in its opposition brief. (Docket No. 14).
`
`
`
`10
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 11 of 12 PageID #: 120
`
`No. 10-1078, 2014 WL 3735157, at *13 (W.D. Pa. July 28, 2014) (internal quotation marks
`
`omitted). The administrative-difficulties factor applies neutrally to the parties.
`
`
`
`As for the localized-interest factor, the Western District certainly has an interest in
`
`resolving a lawsuit involving Eisaman, a Pittsburgh-based corporation. (Docket No. 1 ¶ 4). But
`
`the Western District’s localized interest is matched by the Eastern District Sherman Division’s
`
`localized interest in protecting Smith, a Plano, Texas-based corporation. (Id. ¶ 5). Considering
`
`that Eisaman represented Smith in areas outside the Western District’s jurisdiction, such as West
`
`Virginia and upstate New York (Docket No. 16-1 at 14), the localized-interest factor favors
`
`Smith.
`
`
`
`Finally, the Eastern District Sherman Division is best suited to host a diversity case
`
`applying Texas law. Eisaman and Smith contracted for Texas law to apply to disputes between
`
`them. (Docket No. 9-1 ¶ 18.1). Even if the parties did not choose Texas law, it would apply
`
`anyway. “A federal court sitting in diversity ordinarily must follow the choice-of-law rules of
`
`the [s]tate in which it sits.” Atl. Marine, 134 S. Ct. at 582 (citing Klaxon Co. v. Stentor Elec.
`
`Mfg. Co., 313 U.S. 487, 494–96 (1941)). But “when a party bound by a forum-selection clause
`
`flouts its contractual obligation and files suit in a different forum, a § 1404(a) transfer of venue
`
`will not carry with it the original venue’s choice-of-law rules.” Atl. Marine, 134 S. Ct. at 582.
`
`“[F]ederal courts sitting in diversity apply state substantive law and federal procedural law.”
`
`Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 427 (1996). This court does not doubt its
`
`ability to apply Texas substantive law and choice-of-law rules. However, the Eastern District
`
`Sherman Division is more familiar with Texas law because it sits in Texas. Therefore, this factor
`
`favors Smith.
`
`
`
`11
`
`

`

`Case 4:17-cv-00385-ALM Document 17 Filed 06/01/17 Page 12 of 12 PageID #: 121
`
`
`
`Section 1404(a)’s public-interest factors favor transfer of this action to the Eastern
`
`District Sherman Division.
`
`V.
`
`
`
`Conclusion
`
`Eisaman and Smith agreed to a contract containing a forum-selection clause. This clause
`
`mandates that lawsuits between Eisaman and Smith be filed in a court situated in Collin County,
`
`Texas. The forum-selection clause is valid. Section 1404(a)’s public-interest factors favor
`
`transferring this action to a federal court whose jurisdiction includes Collin County. Therefore,
`
`the court will order this case’s transfer to the Eastern District Sherman Division’s Plano, Texas
`
`courthouse for further proceedings. 28 U.S.C. § 124(c)(3). Smith’s Rule 12(b)(6) motion to
`
`dismiss (Docket No. 9) is denied as moot due to the sua sponte transfer of this action.
`
`
`
`
`
`
`/s/ Robert C. Mitchell
`United States Magistrate Judge
`
`
`
`
`
`
`12
`
`
`
`
`
`
`
`Dated: June 1, 2017
`
`
`
`
`cc:
`
`
`All Counsel of Record
`
`
`
`
`
`
`