Wabash County Young Men’s Christian Association, Inc. v. Thompson, 2012 Ind. App. LEXIS 428
Posted: March 31, 2014 Filed under: Indiana, Legal Case, Release (pre-injury contract not to sue), Sports | Tags: IN, Indiana, Indianapolis, Inherent Risk, Judgment as a matter of law, Magic Words, Minor, Motion (legal), Negligence, parent, Release, Summary judgment, YMCA Leave a commentWabash County Young Men’s Christian Association, Inc. v. Thompson, 2012 Ind. App. LEXIS 428
Wabash County Young Men’s Christian Association, Inc. f/k/a Wabash Community Service, Appellant-Defendant, vs. Taylor M. Thompson, a minor, by next friends, Brian Thompson and Charlene Thompson, Appellees-Plaintiffs.
No. 85A05-1203-CT-138
COURT OF APPEALS OF INDIANA
2012 Ind. App. LEXIS 428
August 31, 2012, Decided
August 31, 2012, Filed
PRIOR HISTORY: [*1]
APPEAL FROM THE WABASH CIRCUIT COURT. The Honorable Robert R. McCallen, III, Judge. Cause No. 85C01-1110-CT-839.
COUNSEL: FOR APPELLANT: RANDALL W. GRAFF, ORFEJ P. NAJDESKI, LESLIE B. POLLIE, Kopka, Pinkus, Dolin & Eads, LLC, Indianapolis, Indiana.
FOR APPELLEES: JOSEF MUSSER, Spitzer Herriman Stephenson, Holderead Musser & Conner, LLP, Marion, Indiana.
JUDGES: BROWN, Judge. FRIEDLANDER, J., and PYLE, J., concur.
OPINION BY: BROWN
OPINION
OPINION – FOR PUBLICATION
BROWN, Judge
Wabash County Young Men’s Christian Association, Inc., (“YMCA”) appeals the trial court’s order denying its motion for summary judgment. The YMCA raises one issue which we revise and restate as whether the trial court erred in denying the YMCA’s motion for summary judgment. We reverse.
The relevant facts follow. On October 13, 2011, Taylor Thompson, by next friends Brian Thompson and Charlene Thompson, filed a complaint against the YMCA alleging that she was at the premises known as the Field of Dreams which was owned by the YMCA on May 28, 2009, and was injured when she slid into second base while participating in the Wabash Metro Summer Baseball/Softball League.1 The complaint alleged that the YMCA was negligent and violated its duty to protect Taylor [*2] by its failure to inspect, warn, and implement preventive measures designed to eliminate or reduce dangers posed by the condition of the second base “such that it was fixed as a rigid obstacle for participants to encounter while sliding into the base and, thereby, posing a clear safety hazard.” Appellant’s Appendix at 7. The complaint alleged that Taylor suffered serious and permanent physical injury.
1 The complaint indicated that Taylor was seventeen years old at the time of the filing of the complaint.
On November 22, 2011, the YMCA filed a Motion to Dismiss And/Or Change of Venue Pursuant to Trial Rule 12(B)(6). The YMCA alleged that Charlene, Taylor’s mother, executed a contractual document for Taylor’s participation in the Wabash Metro Summer Baseball/Softball League, and the YMCA attached the document to the motion. The form contains the following statement:
I (parent or guardian) Charlene Thompson hereby give permission for Taylor Thompson to participate in Metro League Baseball/Softball. I further understand that injuries can occur and will not hold the field, sponsor, coaching staff or league responsible for injury or medical expenses incurred while participating in practice [*3] or playing in a game. I also affirm that my child is physically fit to participate in athletic activities.
Id. at 12. The YMCA alleged that Taylor contractually agreed that there was an inherent risk to her participation in the softball game that could result in injury and that she contractually agreed that she would hold the YMCA, as alleged owner of the field, harmless for any injuries or medical expenses resulting from such injuries.
On December 22, 2011, Taylor filed a response to the YMCA’s motion to dismiss and argued that “in the case of minors, a person claiming tort damages on behalf of the minor against another person has power to execute a release on the minor’s behalf, however, the release must be approved by the Court before being effective.” Appellant’s Appendix at 14. Taylor also alleged that the document YMCA relies upon did not contemplate an injury from the negligent maintenance of the property, rather, it contemplates the foreseeable injuries which can inherently occur while playing baseball or softball. Taylor argued that the YMCA was not a party to the understanding evidenced by the document.
On December 30, 2011, the court held a hearing on the YMCA’s motion. On [*4] January 18, 2012, the court denied the YMCA’s motion to dismiss. On February 16, 2012, the YMCA filed a motion to certify the interlocutory order, which the court granted on February 21, 2012. On April 16, 2012, this court accepted jurisdiction pursuant to Ind. Appellate Rule 14(B).
The issue is whether the trial court erred by denying summary judgment to the YMCA. Initially, we note that the YMCA’s motion to dismiss was filed pursuant to Ind. Trial Rule 12(B)(6) and attached the form completed by Taylor’s mother. Therefore, we will review the YMCA’s motion to dismiss as a motion for summary judgment. [HN1] See Ind. Trial Rule 12(B) (“If, on a motion, asserting the defense number (6), to dismiss for failure of the pleading to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56.”); New Albany-Floyd Cnty. Educ. Ass’n v. Ammerman, 724 N.E.2d 251, 255 n.7 (Ind. Ct. App. 2000) (“Although the trial court specifically granted Holman’s motion to dismiss and did not rule on his motion for summary judgment, we must nevertheless treat [*5] the former as a motion for summary judgment on review.”); Galbraith v. Planning Dep’t of City of Anderson, 627 N.E.2d 850, 852 (Ind. Ct. App. 1994) (treating the trial court’s dismissal of plaintiff’s complaint as a summary judgment for the defendant when plaintiff submitted an affidavit and the trial court acknowledged that it considered matters outside the pleadings).
[HN2] Summary judgment is appropriate only where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Ind. Trial Rule 56(C); Mangold ex rel. Mangold v. Ind. Dep’t of Natural Res., 756 N.E.2d 970, 973 (Ind. 2001). All facts and reasonable inferences drawn from those facts are construed in favor of the nonmovant. Mangold, 756 N.E.2d at 973. [HN3] Our review of a summary judgment motion is limited to those materials designated to the trial court. Id. [HN4] We must carefully review a decision on summary judgment to ensure that a party was not improperly denied its day in court. Id. at 974. [HN5] “[A] motion for summary judgment that is unopposed should be granted only if the designated materials, regardless of whether they stand unopposed by materials designated by the nonmovant, warrant it.” [*6] Starks v. Village Green Apartments, 854 N.E.2d 411, 415 (Ind. Ct. App. 2006), abrogated on other grounds by Klotz v. Hoyt, 900 N.E.2d 1 (Ind. 2009).
[HN6] In reviewing a grant of summary judgment we face the same issues as the trial court and follow the same process. Klinker v. First Merchants Bank, N.A., 964 N.E.2d 190, 193 (Ind. 2012). [HN7] Under Trial Rule 56(C), the moving party bears the burden of making a prima facie showing that there are no genuine issues of material fact and that it is entitled to judgment as a matter of law. Id. If it is successful, the burden shifts to the nonmoving party to designate evidence establishing the existence of a genuine issue of material fact. Id.
[HN8] “In order to prevail on a claim of negligence, a plaintiff is required to prove: (1) a duty owed by the defendant to the plaintiff; (2) a breach of that duty by the defendant; and (3) an injury to the plaintiff proximately caused by the breach.” Peters v. Forster, 804 N.E.2d 736, 738 (Ind. 2004). [HN9] In negligence cases, summary judgment is “rarely appropriate.” Rhodes v. Wright, 805 N.E.2d 382, 387 (Ind. 2004). “This is because negligence cases are particularly fact sensitive and are governed by a standard of the [*7] objective reasonable person–one best applied by a jury after hearing all of the evidence.” Id. Nevertheless, a defendant is entitled to judgment as a matter of law when the undisputed material facts negate at least one element of the plaintiff’s claim. Id. at 385.
We initially address Taylor’s argument that while Indiana law requires that a parent claiming tort damages on behalf of a minor against another person has power to execute a release on the minor’s behalf, the release must be approved by the court to be valid. Taylor cites Ind. Code § 29-3-9-7(b) which provides:
[HN10] Whenever a minor has a disputed claim against another person, whether arising in contract, tort, or otherwise, and a guardian for the minor and the minor’s property has not been appointed, the parents of the minor may compromise the claim. However, before the compromise is valid, it must be approved by the court upon filing of a petition requesting the court’s approval. If the court approves the compromise, it may direct that the settlement be paid in accordance with IC 29-3-3-1. If IC 29-3-3-1 is not applicable, the court shall require that a guardian be appointed and that the settlement be delivered to the guardian [*8] upon the terms that the court directs.
Taylor argues that “[n]o Indiana statute, rule, or decision authorizes a parent of a minor to sign a pre-tort waiver.” Appellee’s Brief at 5. Taylor also argues that “the Indiana statute requiring court approval of minor’s claim settlement arises out of a public policy of favoring protection of minors with respect to contractual obligations” and “[t]he statute guards minors against improvident compromises made by their parents.” Id.
The YMCA argues that Taylor’s reliance on Ind. Code § 29-3-9-7(b) “is misplaced and has no bearing on the subject matter at issue in this case, which involves a vastly different legal scenario having nothing to do with probating a disputed claim a minor has against another person.” Appellant’s Brief at 8. The YMCA also argues that if Taylor’s argument is accepted, it would render all releases signed by parents to allow their children to participate in school and sporting events ineffective and meaningless. The YMCA contends that “[i]t would be impossible for parents to obtain court approval for every release or hold harmless agreement for every club, hobby, camp, and sporting activity for each of their children.” Id. at 9.
We [*9] observe that the referenced statute governs a post-injury claim and falls under Title 29, which governs probate law, and not the issue in this case. Further, Taylor does not point to any other authority indicating that the release form was invalid. Under the circumstances, we conclude that the release form is valid. See Bellew v. Byers, 272 Ind. 37, 38, 396 N.E.2d 335, 336 (1979) (addressing a minor’s compromise claim in which the parent and natural guardian was paid an amount for the injuries to her three children in return for a release), abrogated on other grounds by Huffman v. Monroe Cnty. Cmty. Sch. Corp., 588 N.E.2d 1264 (Ind. 1992); Zivich v. Mentor Soccer Club, Inc., 82 Ohio St. 3d 367, 1998 Ohio 389, 696 N.E.2d 201, 206-207 (Ohio 1998) (holding that it was not appropriate to equate a pre-injury release with a post-injury release and that parents have the authority to bind their minor children to exculpatory agreements in favor of volunteers and sponsors of nonprofit sport activites where the cause of action sounds in negligence).
We next turn to whether the release applies to Taylor’s injury. The YMCA argues that the release form applies to Taylor’s action of sliding into second base during the softball game. [*10] The YMCA also argues that “one can take almost any on-field mishap and seek to couch it in terms of negligence by arguing for more padding, softer playing surfaces, rule changes, etc., but the fact remains that the injury arose because of a risk inherent in the game.” Appellant’s Reply Brief at 3. Taylor argues that the YMCA’s repeated reference to her injury being the result of her sliding into second base without referencing the accompanying allegations of the complaint that the injury was caused by the negligent maintenance of the second base is a glaring omission throughout the YMCA’s argument.
“It is well established in Indiana that [HN11] exculpatory agreements are not against public policy.” Stowers v. Clinton Cent. Sch. Corp., 855 N.E.2d 739, 749 (Ind. Ct. App. 2006), trans. denied. [HN12] “Generally, parties are permitted to agree that a party owes no obligation of care for the benefit of another, and thus, shall not be liable for consequences that would otherwise be considered negligent.” Marsh v. Dixon, 707 N.E.2d 998, 1000 (Ind. Ct. App. 1999), trans. denied. However, this court has held that an exculpatory clause will not act to absolve a party from liability unless it “‘specifically [*11] and explicitly refer[s] to the negligence of the party seeking release from liability.'” Id. (quoting Powell v. Am. Health Fitness Ctr. of Fort Wayne, Inc., 694 N.E.2d 757, 761 (Ind. Ct. App. 1998)). [HN13] An exculpatory clause may be found sufficiently specific and explicit on the issue of negligence even in the absence of the word itself. Anderson v. Four Seasons Equestrian Ctr., Inc., 852 N.E.2d 576, 581 (Ind. Ct. App. 2006), trans. denied. Furthermore, [HN14] an exculpatory clause not referring to the negligence of the releasee may act to bar liability for those damages incurred which are inherent in the nature of the activity. Id. [HN15] The requirement of specificity is only necessary when the risk of harm is a latent danger, i.e. the defendant’s own negligence. Id. at 581-582.
The form signed by Taylor’s mother did not release the YMCA of liability for all negligent acts because the form did not contain any specific or explicit reference to the negligence of the YMCA or owner of the field. See Stowers, 855 N.E.2d at 749 (“The Stowers’ proposed instruction set out that the Release Forms did not absolve Clinton Central of liability for negligent acts if they did not contain language specifically referring [*12] to negligence; thus, it was a correct statement of the law.”). Thus, we must determine whether Taylor’s injury was derived from a risk inherent in the nature of the activity. See Anderson, 852 N.E.2d at 581 (holding that an exculpatory clause not referring to the negligence of the releasee may act to bar liability for those damages incurred which are inherent in the nature of the activity).
Sliding into second base, notwithstanding its rigidity, is an activity inherent in the nature of playing baseball or softball and we conclude that Taylor’s injury was derived from a risk inherent in the nature of the activity. See id. at 584-585 (observing that the plaintiff was injured when attempting to mount her horse and concluding that the plaintiff’s damages were inherent in the nature of the activity of horse riding and that the trial court did not err by granting summary judgment to the defendants). The release attached to the YMCA’s motion to dismiss indicated that the owner of the field would not be responsible for any injury or medical expenses “incurred while participating in practice or playing in a game.” Appellant’s Appendix at 12. Based upon the language in the release, we conclude [*13] that the YMCA met its burden of making a prima facie showing that there were no genuine issues of material fact and that it was entitled to judgment as a matter of law and that the burden then shifted to Taylor who did not designate any evidence to show that an issue of material fact existed. Accordingly, we conclude that the trial court erred by denying the YMCA’s motion for summary judgment.
For the foregoing reasons, we reverse the trial court’s denial of the YMCA’s motion for summary judgment.
Reversed.
FRIEDLANDER, J., and PYLE, J., concur.
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Foster, et al., v. Kosseff, et al., 2013 U.S. Dist. LEXIS 5380
Posted: February 25, 2013 Filed under: Climbing Wall, Legal Case, Washington | Tags: Adventure Safety International, Alex Kosseff, Climbing Wall, Federal Rules of Civil Procedure, Fixe Hardware, LLC's, Motion (legal), Stephanie Foster, Super Shut, United States district court, Washington, Whitman College Leave a commentFoster, et al., v. Kosseff, et al., 2013 U.S. Dist. LEXIS 5380
Stephanie Foster, et al., Plaintiffs, v. Alex Kosseff, et al., Defendants.
NO: 11-CV-5069-TOR
United States District Court For The Eastern District Of Washington
2013 U.S. Dist. LEXIS 5380
January 14, 2013, Decided
January 14, 2013, Filed
CORE TERMS: audit report, audit, duty of care, beneficiary–, climbing, owed, failure to state a claim, citation omitted, incorporation, discover, lawsuit, anchor, owe, dangerous condition, negligence claim, authenticity, quotation, summary judgment, recreational, leave to amend, underlying purpose, recommendations, deliberately, cognizable, omitting, coverage, survive, amend, issues of law, discovery
COUNSEL: [*1] For Stephanie Foster, Susan Foster, Gary Foster, Plaintiffs: Allen M Ressler, LEAD ATTORNEY, Ressler and Tesh PLLC, Seattle, WA; William S Finger, LEAD ATTORNEY, Frank & Finger PC, Evergreen, CO.
For Alex Kosseff, Adventure Safety International LLC, Defendants: Heather C Yakely, LEAD ATTORNEY, Evans Craven & Lackie PS – SPO, Spokane, WA.
JUDGES: THOMAS O. RICE, United States District Judge.
OPINION BY: THOMAS O. RICE
OPINION
ORDER DENYING DEFENDANT ADVENTURE SAFETY INTERNATIONAL’S MOTION TO DISMISS
BEFORE THE COURT is Defendants Alex Kosseff’s and Adventure Safety International, LLC’s motion to dismiss for failure to state a claim (ECF No. 33). This motion was heard without oral argument on January 14, 2013. The Court has reviewed the motion, the response, and the reply, and is fully informed.
BACKGROUND
In this diversity case, Plaintiff seeks to recover damages for a back injury which she sustained during a fall from a recreational climbing wall maintained by her employer, Whitman College. Plaintiff alleges that Defendants Alex Kosseff and Adventure Safety International, LLC, were negligent in failing to discover the dangerous condition which caused the accident during a safety audit commissioned by Whitman College [*2] in 2007. Defendants have moved to dismiss the complaint for failure to state a claim on the ground that they did not owe a duty of care to Plaintiff. For the reasons discussed below, the Court will deny the motion.
FACTS
Plaintiff Stephanie Foster (“Plaintiff”) is a student enrolled at Whitman College in Spokane, Washington. In April 2008, Plaintiff was employed as a student instructor in Whitman College’s Outdoor Program. One of her duties in this position was to teach other students how to properly climb and descend a recreational climbing wall located on the Whitman College campus.
On April 28, 2008, Plaintiff fell from the climbing wall during a training exercise and was seriously injured. A subsequent investigation revealed that the accident occurred when a “Super Shut” climbing anchor manufactured by Defendant Fixe Industry1 inadvertently opened while Plaintiff was descending the wall. This investigation further revealed that the anchor opened as a result of Plaintiff using it in a manner for which it was not designed.
1 Defendant Fixe Industry has never been served in this action.
Approximately one year prior to Plaintiff’s accident, Whitman College hired Defendants Alex Kosseff and [*3] Adventure Safety International, LLC (collectively “ASI”) to perform a “risk management audit” of the Outdoor Program’s facilities. The parties sharply disagree about the scope of this audit. Plaintiff asserts that the audit extended to identifying and mitigating all risks posed to users of the climbing wall. ASI maintains that the audit was merely intended to provide Whitman College with a “general understanding” of how to improve its risk management program. In any event, it is undisputed that ASI’s audit did not identify the risk that the Super Shut anchor posed when used improperly.
Plaintiff filed this lawsuit on April 22, 2011. Among other claims, Plaintiff asserts that ASI was negligent in failing to discover the risk posed by the Super Shut anchor. ASI now moves to dismiss the lawsuit for failure to state a claim on the ground that it did not owe Plaintiff a duty of care as a matter of law. Because ASI has previously filed an answer to Plaintiff’s Complaint, (ECF No. 9) the Court will treat the instant motion as a motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). Elvig v. Calvin Presbyterian Church, 375 F.3d 951, 954 (9th Cir. 2004).
DISCUSSION
A [*4] motion for judgment on the pleadings is reviewed under the same legal standard as a motion to dismiss filed pursuant to Federal Rule of Civil Procedure 12(b)(6). Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989). A motion to dismiss “tests the legal sufficiency of a [plaintiff’s] claim.” Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). To survive such a motion, the plaintiff must allege facts which, when taken as true, “state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868, (2009) (quotation and citation omitted). To satisfy this plausibility standard, the allegations in a complaint must be sufficient “to raise a right to relief above the speculative level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, are insufficient. Iqbal, 556 U.S. at 678.
In addition, Federal Rule of Civil Procedure 8(a)(2) requires that a plaintiff’s complaint contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). This standard “does not require ‘detailed factual allegations,’ [*5] but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). To determine whether Rule 8(a)(2) has been satisfied, a court must first identify the elements of the plaintiff’s claim(s) and then determine whether those elements could be proven on the facts pled. Although the court should generally draw reasonable inferences in the plaintiff’s favor, see Sheppard v. David Evans and Assoc., 694 F.3d 1045, 1051 (9th Cir. 2012), it need not accept “naked assertions devoid of further factual enhancement.” Iqbal, 556 U.S. at 678 (internal quotations and citation omitted).
The Ninth Circuit has repeatedly instructed district courts to “grant leave to amend even if no request to amend the pleading was made, unless … the pleading could not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000). The standard for granting leave to amend is generous–the court “should freely give leave when justice so requires.” Fed.R.Civ.P. 15(a)(2). In determining whether leave to amend is appropriate, a court must consider the following five factors: bad faith, undue delay, prejudice [*6] to the opposing party, futility of amendment, and whether the plaintiff has previously amended the complaint. United States v. Corinthian Colleges, 655 F.3d 984, 995 (9th Cir. 2011).
A. Consideration of the Draft Audit Report
In support of its motion to dismiss, ASI has submitted a document entitled “Whitman College Outdoor Programs Draft Risk Management Audit” (hereafter “audit report”). ECF No. 36-1. The parties disagree about whether the Court may properly consider the contents of this document without converting the instant motion into a motion for summary judgment. On December 4, 2012, in response to Plaintiff’s concerns that ASI was effectively seeking summary judgment, the Court ruled that it would treat ASI’s motion “as a standard motion to dismiss, considering only (1) facts specifically alleged in the complaint; and (2) documents submitted by Defendants that were referenced in the complaint and whose authenticity has not been questioned.” ECF No. 52 at 3-4. This ruling was based, in large part, upon ASI’s representations that it had submitted the audit report “for background purposes” only and that the contents of the report were “not relevant to the actual issues of law before [*7] the court.” See ECF No. 51 at 5.
It has now become clear that the contents of the audit report are material to the issues of law presented in the instant motion. The crux of ASI’s argument is that it did not owe Plaintiff a duty of care because the dangerous condition which caused her accident was simply “outside the scope of the risk management audit” that it agreed to perform. ECF No. 70 at 7. Specifically, ASI argues that the scope of the audit was limited to “gain[ing] a general understanding of [Whitman College’s] risk management practices,” and that it did not “guarantee that future operations will be free of safety incidents.” ECF No. 70 at 7 (citing ECF No. 71-1 at 9). Because this argument expressly relies upon the contents of the audit report itself, the Court must decide whether the audit report is “fair game” at this early stage of the proceedings.
“Generally, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion.” Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n. 19 (9th Cir. 1989). One exception to this rule is the so-called “incorporation by reference doctrine,” which permits a court to consider “documents [*8] whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the plaintiff’s pleading.” Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005). As the Ninth Circuit explained in Knievel, this exception typically applies in “situations in which the plaintiff’s claim depends on the contents of a document, the defendant attaches the document to its motion to dismiss, and the parties do not dispute the authenticity of the document.” Id. The underlying purpose of this exception is “to prevent plaintiffs from surviving a Rule 12(b)(6) motion by deliberately omitting documents upon which their claims are based.” Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007) (quotation and citation omitted); see also United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003) (explaining that that the incorporation by reference doctrine “may apply, for example, when a plaintiff’s claim about insurance coverage is based on the contents of a coverage plan, or when a plaintiff’s claim about stock fraud is based on the contents of SEC filings”) (citations omitted).
The Court will not consider the audit report under the incorporation by reference [*9] doctrine for several reasons. First, the contents of the report are disputed. In responding to the instant motion, Plaintiff indicates that only a portion of the document was prepared by Defendant Kosseff and that another portion may have been prepared by Whitman College prior to ASI’s inspection of its facilities. ECF No. 67 at 2-3. Plaintiff further asserts that the audit report purports to be a draft rather than a finalized document. See ECF No. 36-1. This latter assertion is particularly on-point. Indeed, the document is styled as a “Draft Risk Management Audit,” and has the words “Whitman College Draft Risk Management Audit” reproduced at the top of each page. ECF No. 36-1 (emphasis in original).
Second, considering the audit report at this juncture would not serve the underlying purpose of the incorporation by reference doctrine. Notably, this is not a case in which the plaintiff has attempted to survive a motion to dismiss “by deliberately omitting documents upon which [her] claims are based.” Swartz, 476 F.3d at 763. To the contrary, Plaintiff did not have a copy of the audit report (and therefore lacked knowledge of its precise contents) when this lawsuit was filed. See Pl.’s [*10] Compl., ECF No. 1, at ¶¶ 15, 30-31 (alleging that Plaintiff learned of the audit report’s existence from an investigation performed by the Department of Labor and Industries and that Whitman College and Defendant ASI “failed or refused” to provide her with a copy before the lawsuit was filed).
Third, the contents of the audit report are not particularly “integral” to Plaintiff’s claim. See Ritchie, 342 F.3d at 908. Unlike claims for breach of an insurance contract, for example (see Ritchie, 342 F.3d at 908), Plaintiff’s negligence claim does not necessarily rely upon the contents of a specific document. In fact, Plaintiff could theoretically prove the elements of her negligence claim (i.e., duty, breach, causation and damages) exclusively through witness testimony without introducing the audit report at all. Further, it is worth noting that the audit report is not a contract between ASI and Whitman College; it is simply ASI’s work product. As such, the audit report is not particularly probative of the most crucial issue in this case: whether ASI owed Plaintiff a legal duty. Although the report details specific tasks performed, it does not describe the precise scope of work that that [*11] ASI agreed to perform.
Finally, equitable considerations weigh against considering the audit report at this time. At bottom, Plaintiff’s negligence claim relies on the allegation that ASI agreed to “analyze and point out dangers and suggest remediation of dangers to prevent injury to students and employees utilizing the climbing wall.” Pl.’s Compl., ECF No. 1, at ¶ 28. ASI has attempted to establish that the audit was more limited in scope and that, as a result, it did not owe Plaintiff a duty of care. In so doing, however, ASI has expressly relied upon the contents of the audit report. Based upon ASI’s prior representation that it would not do so, the Court denied Plaintiff an opportunity to conduct additional discovery relevant to this issue. That ruling has now placed Plaintiff at a significant disadvantage. Accordingly, the Court will not consider the contents of the audit report to the exclusion of other evidence which Plaintiff may develop as discovery progresses.
B. Duty Owed to Intended Third-Party Beneficiary
In light of the Court’s ruling above, the only remaining issue is whether Plaintiff has stated a legally cognizable claim on the facts alleged in the complaint. In the Court’s [*12] view, the relevant inquiry is whether Plaintiff was an intended third-party beneficiary of the contract between ASI and Whitman College. To the extent that Plaintiff was an intended beneficiary as an employee and student of Whitman College, ASI may have owed her a duty of care to discover the dangerous condition at issue. See Burg v. Shannon & Wilson, Inc., 110 Wash. App. 798, 807-08, 43 P.3d 526 (2002) (holding that engineering firm had no duty of care to disclose specific safety recommendations to third party who would have benefitted from the recommendations, but who was not an intended third-party beneficiary of the underlying agreement). To the extent that Plaintiff was merely an incidental beneficiary of the contract, however, she lacks a cognizable claim. Id. Stated somewhat differently, the viability of Plaintiff’s claim depends upon the extent to which ASI agreed to undertake the risk management audit for the benefit of the college’s employees and students rather than for the benefit the college itself.
In her complaint, Plaintiff squarely alleges that the risk management audit was performed for the benefit of Whitman College’s employees and students. See Pl.’s Compl., ECF No. 1, at ¶ 28 [*13] (“The risk assessment was done for the benefit of Whitman College and its employees and students because Whitman College understood its duty to provide safe recreational activities and as part of good institutional management.”). This allegation, which the Court must accept as true for purposes of this motion, is sufficient to establish that Plaintiff was an intended third-party beneficiary of the agreement such that ASI may have owed her a duty of care to discover the dangerous condition at issue. Whether Plaintiff was in fact an intended beneficiary–as well as the scope of any duty owed to her by ASI–may be revisited on summary judgment.
ACCORDINGLY, IT IS HEREBY ORDERED:
Defendants’ motion to dismiss for failure to state a claim (ECF No. 33) is DENIED.
The District Court Executive is hereby directed to enter this Order and provide copies to counsel.
DATED this 14th day of January, 2012.
/s/ Thomas O. Rice
THOMAS O. RICE
United States District Judge
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By Recreation Law Rec-law@recreation-law.com James H. Moss Jim Moss
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Is there a duty to notify parents when an investigation is being conducted by the state to protect campers?
Posted: February 27, 2012 Filed under: Florida, Jurisdiction and Venue (Forum Selection), Minors, Youth, Children, Summer Camp | Tags: Florida, Jurisdiction, Long-Arm Jurisdiction, Motion (legal), North Carolina, Parental Responsibility, summer camp, Youth Camp Leave a commentCamp Illahee Investors, Inc., v. Blackman, 870 So. 2d 80; 2003 Fla. App. LEXIS 17549; 28 Fla. L. Weekly D 2672
Parents claim the camp was negligent in not informing them the state department of social services was going to or had interviewed their kids.
The problem is the case does not answer the question. This again, is a jurisdiction and venue motion that was appealed. The defendant camp was located in North Carolina. The plaintiffs were Florida’s residents. The only contact the camp had with Florida was 22% of its campers came from Florida, and one of the owners would spend a week in Florida every year drumming up business for the next summer.
The initial allegations giving rise to the litigation are very interesting. The plaintiff’s claim, the camp and the owners were negligent because the:
…Defendants had a duty, after being informed that the North Carolina County Department of Social Services desired to interview the Plaintiffs’ minor children, to notify the Plaintiffs of the fact that the minor children were to be interviewed by the North Carolina County Department of Social Services about possible child abuse….
There was a second allegation that a junior counselor had injured one of the plaintiff’s when he stepped on her feet. (Where they dancing?) This claim was not resolved in this appeal either.
Summary of the case
The plaintiff’s sued in Florida, and the defendants moved to dismiss. The trial court did not dismiss for lack of jurisdiction, and the defendants appealed. The defendants argued that they were:
…not subject to the jurisdiction of a Florida court and, even if jurisdiction existed in Florida, that North Carolina was an adequate alternative forum. Camp Illahee further argued that it was immune from suit under North Carolina law and that Florida’s impact rule required dismissal.
To support their argument the defendant must show the facts that prove their allegations. That is usually done by affidavits of the defendants and possibly others to prove the issue, or really, the lack of contact with the state.
Camp Illahee is a North Carolina corporation; the summer camp is located in North Carolina; Camp Illahee has no offices in Florida; it has no employees in Florida, although some of the employees who work at the camp during the summer are from Florida; Camp Illahee does no advertising in Florida by newspapers, radio, or television, but it has a one and one-half page posting on its internet website advising of “fall reunion and video shows.”
The court must then look at the State Long Arm Statute to determine if the facts make the defendant subject to the jurisdiction of the court. Under Florida’s law that analysis is:
…whether (1) there are sufficient jurisdictional facts to bring the action within the purview of the long-arm statute; and (2) the nonresident defendant involved has sufficient minimum contacts with Florida to satisfy constitutional due process requirements.
The Florida Long Arm Statute sets forth the minimum requirements to establish jurisdiction over out of state parties.
Section 48.193(1)(a)
(1) Any person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from the doing of any of the following acts:
(a) Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.
Section 48.193(2):
A defendant who is engaged in substantial and not isolated activity within this state, whether such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the courts of this state, whether or not the claim arises from that activity.
The court then applies the information presented by the parties to the requirements of the statutes to see if the defendant has the necessary minimum contacts with the state to be sued in that state and subject to the laws of that state.
So Now What?
The trend from the courts is to allow you to be brought into distant states and their judicial system. This case is a rarity. This is another example of where the agreement between the camp and the parents or any parties to any outdoor recreation, should agree in advance to where any litigation will be developed.
As far as notifying parents of an interview by social services for possible child abuse, I think I would always lean towards notifying the parents. In fact, I think I would notify the parents immediately. A parent must believe that their child is safe. Whether the child is safe is put into question, if social services is investigating your camp.
This may be a PR nightmare or disaster for any camp or program dealing with minors. You will need to make sure you bring in PR professionals and probably your attorney if this situation arises.
You should also set up a program and working relationship where anyone can come and talk to you about problems. Hopefully, before social services had been called, you are on top of the issue and have dealt with it.
What do you think? Leave a comment.
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Camp Illahee Investors, Inc., v. Blackman, 870 So. 2d 80; 2003 Fla. App. LEXIS 17549; 28 Fla. L. Weekly D 2672
Posted: February 27, 2012 Filed under: Florida, Jurisdiction and Venue (Forum Selection), Legal Case, Minors, Youth, Children, Summer Camp | Tags: Camp, Florida, Long-Arm Jurisdiction, Motion (legal), North Carolina, Recreation, summer camp Leave a commentCamp Illahee Investors, Inc., v. Blackman, 870 So. 2d 80; 2003 Fla. App. LEXIS 17549; 28 Fla. L. Weekly D 2672
Camp Illahee Investors, Inc., a North Carolina Corporation, Appellant, v. Michael Blackman and Patrice Blackman, Individually and as the Parents, Natural Guardians and next best friends of Olivia Blackman and Sophie Blackman, minor children, and Frank Tindall and Elizabeth Tindall, Appellees.
Case No. 2D02-4324
COURT OF APPEAL OF FLORIDA, SECOND DISTRICT
870 So. 2d 80; 2003 Fla. App. LEXIS 17549; 28 Fla. L. Weekly D 2672
November 19, 2003, Opinion Filed
PRIOR HISTORY: [**1] Appeal from nonfinal order of the Circuit Court for Hillsborough County; Daniel E. Gallagher, Senior Judge.
DISPOSITION: Reversed and remanded with directions.
COUNSEL: J. Gregory Giannuzzi of Rissman, Weisberg, Barrett, Hurt, Donahue & McLain, P.A., Tampa, for Appellant.
Jeffrey A. Blau, Tampa, for Appellees Michael Blackman and Patrice Blackman, Individually and as the Parents, Natural Guardians and next best friends of Olivia Blackman and Sophie Blackman, minor children.
No appearance for Appellees, Frank Tindall and Elizabeth Tindall.
JUDGES: SILBERMAN, Judge. STRINGER, J., and THREADGILL, EDWARD F., SENIOR JUDGE, Concur.
OPINION BY: SILBERMAN
OPINION
[*82] SILBERMAN, Judge.
Camp Illahee Investors, Inc., a North Carolina corporation, appeals a nonfinal [*83] order that denied its motion to dismiss for lack of personal jurisdiction. Because jurisdiction was not established under Florida’s long-arm statute, we reverse.
Appellees Michael and Patrice Blackman, individually and on behalf of their minor daughters, sued Camp Illahee and its owners, Frank and Elizabeth Tindall, for alleged torts committed in North Carolina while [**2] the Blackmans’ two daughters were attending summer camp in 2001. 1 In their first amended complaint, the Blackmans alleged that while their daughters were at the camp, someone placed an “anonymous child abuse call” to a county department of social services in North Carolina, whose representatives then interviewed the Blackmans’ daughters. The Blackmans alleged that the “Defendants had a duty, after being informed that the North Carolina County Department of Social Services desired to interview the Plaintiffs’ minor children, to notify the Plaintiffs of the fact that the minor children were to be interviewed by the North Carolina County Department of Social Services about possible child abuse.” The Blackmans also alleged that a junior counselor battered one of the daughters “by stepping on her feet and inflicting other physical injuries and mental abuse” on her.
1 The trial court dismissed the Tindalls from the litigation, and the Blackmans have not appealed that ruling.
Camp Illahee filed a motion to dismiss [**3] and asserted, among other grounds, that it was not subject to the jurisdiction of a Florida court and, even if jurisdiction existed in Florida, that North Carolina was an adequate alternative forum. Camp Illahee further argued that it was immune from suit under North Carolina law and that Florida’s impact rule required dismissal.
Camp Illahee submitted affidavits from the Tindalls, the owners and operators of the camp. The affidavits reflect that Camp Illahee is a North Carolina corporation; the summer camp is located in North Carolina; Camp Illahee has no offices in Florida; it has no employees in Florida, although some of the employees who work at the camp during the summer are from Florida; Camp Illahee does no advertising in Florida by newspapers, radio, or television, but it has a one and one-half page posting on its internet website advising of “fall reunion and video shows.”
Mrs. Tindall’s affidavit also reflects that she travels to various states to engage in the reunion and video shows, which are designed to have “the children get together to talk about Camp, and to become excited for camp the next summer.” The reunions take place in the homes of camp families, and the [**4] families receive a discount in the camp fee for hosting the reunions. The discounts amounted to .15% of Camp Illahee’s gross revenues in 2000 and .08% in 2001. In 2000 and 2001, 22% of the campers were from Florida.
Although Camp Illahee argues that its motion to dismiss could properly have been granted on any of the grounds raised in its motion, the key issue is whether the trial court had long-arm jurisdiction over Camp Illahee. [HN1] Our standard of review on the issue of personal jurisdiction over a foreign corporation is de novo. See Execu-Tech Bus. Sys., Inc. v. New Oji Paper Co., 752 So. 2d 582, 584 (Fla. 2000). [HN2] Additionally, we are required to strictly construe Florida’s long-arm statute. See Esberger v. First Fla. Bus. Consultants, Inc., 338 So. 2d 561, 562 (Fla. 2d DCA 1976).
The pertinent facts relating to jurisdiction are not in dispute. [HN3] The determination [*84] of whether the trial court has personal jurisdiction over Camp Illahee turns on “whether (1) there are sufficient jurisdictional facts to bring the action within the purview of the long-arm statute; and (2) the nonresident defendant involved has sufficient minimum contacts with Florida to [**5] satisfy constitutional due process requirements.” Kin Yong Lung Indus. Co. v. Temple, 816 So. 2d 663, 666 (Fla. 2d DCA 2002); see also Venetian Salami Co. v. Parthenais, 554 So. 2d 499, 502 (Fla. 1989).
In its order denying the motion to dismiss, the trial court did not discuss this two-prong test. Instead, it simply stated, “Jurisdiction as to Camp Illahee Investors, Inc. will remain in Florida pursuant to the doctrine of forum non conveniens, as set forth in Fla. R. Civ. P. 1.061.” However, [HN4] before reaching the issue of forum non conveniens under Florida Rule of Civil Procedure 1.061, the trial court was required to first determine whether it had in personam jurisdiction in accordance with the two-prong test. See La Reunion Francaise, S.A. v. La Costena, 818 So. 2d 657, 659 (Fla. 3d DCA 2002) (concluding that there was no personal jurisdiction over the foreign defendant and, therefore, no need to reach other issues raised in the motion to dismiss, including the issue of forum non conveniens).
After reviewing the record and the applicable statutory language in light of the required two-prong jurisdictional analysis, we conclude [**6] that the trial court should have dismissed the Blackmans’ first amended complaint for lack of in personam jurisdiction. The allegations of the first amended complaint establish that the only possible bases for jurisdiction are under sections 48.193(1)(a) or 48.193(2) of the long-arm statute. Section 48.193(1)(a) [HN5] provides as follows:
(1) Any person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from the doing of any of the following acts:
(a) Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.
Section 48.193(2) [HN6] states as follows:
A defendant who is engaged in substantial and not isolated activity within this state, whether such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the courts of this state, whether or not the claim arises from that activity.
In the trial [**7] court, the Blackmans asserted that because Mrs. Tindall came to Florida one week a year for the reunion and video shows, Camp Illahee was conducting business in Florida. They also argued that the families that hosted the reunions were agents of Camp Illahee.
Concerning the agency argument, nothing in the record reflects that either an apparent or actual agency relationship existed between the host families and Camp Illahee. In particular, there was no showing that Camp Illahee made any representations that the host families were the agents of Camp Illahee, or that Camp Illahee, as principal, exercised control over the families, as agents. See Ilgen v. Henderson Props., Inc., 683 So. 2d 513, 514-15 (Fla. 2d DCA 1996) (discussing the elements necessary to establish apparent or actual agency); State v. Am. Tobacco Co., 707 So. 2d 851, 854 (Fla. 4th DCA 1998) (stating that control by the principal [*85] over the agent is a necessary element of agency).
The Blackmans’ second argument is premised on section 48.193(1), which confers jurisdiction for “any cause of action arising from the doing of” any of the enumerated items, such as conducting business in Florida. [**8] [HN7] By its terms, section 48.193(1) requires connexity between the defendant’s activities and the cause of action. Wendt v. Horowitz, 822 So. 2d 1252, 1260 (Fla. 2002). Here, the record reflects that the connexity requirement has not been met because the Blackmans’ claims did not arise from the reunions and video shows that took place in Florida during one week per year. Rather, the claims arose out of alleged torts that occurred in North Carolina while the Blackmans’ daughters attended the camp.
Even if the undisputed facts fell within the ambit of section 48.193(1), Camp Illahee must have sufficient minimum contacts with Florida to satisfy due process requirements. See Venetian Salami, 554 So. 2d at 500. [HN8] The test is whether Camp Illahee’s conduct is such that it “should reasonably anticipate being haled into court” in Florida. See Venetian Salami, 554 So. 2d at 500 (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 62 L. Ed. 2d 490, 100 S. Ct. 559 (1980)); see also Emerson v. Cole, 847 So. 2d 606, 608 (Fla. 2d DCA 2003). We agree with Camp Illahee that the limited contact between it [**9] and Florida as a result of the yearly reunion and video shows is insufficient to establish that it could reasonably anticipate being haled into court in Florida for the allegedly tortious conduct occurring in North Carolina.
A second potential basis for jurisdiction is section 48.193(2), which provides that a defendant is subject to a Florida court’s jurisdiction when the defendant “is engaged in substantial and not isolated activity within this state . . . whether or not the claim arises from that activity.” [HN9] This section “does not require connexity between a defendant’s activities and the cause of action.” Woods v. Nova Cos. Belize Ltd., 739 So. 2d 617, 620 (Fla. 4th DCA 1999). Additionally, if the defendant’s activities meet the requirements of this section, the due process requirement of minimum contacts is fulfilled. Id. However, the record before us does not support a conclusion that Camp Ilahee’s conduct constitutes substantial activity in Florida. See deMco Techs., Inc. v. C.S. Engineered Castings, Inc., 769 So. 2d 1128, 1132 (Fla. 3d DCA 2000) (stating that sporadic sales in Florida could not provide jurisdiction for litigation regarding [**10] an unrelated promissory note); Price v. Point Marine, Inc., 610 So. 2d 1339, 1341 (Fla. 1st DCA 1992) (noting that sporadic activities or visits to Florida consisting of the occasional solicitation of business in Florida do not constitute “substantial and not isolated activity”).
Because the undisputed facts do not demonstrate a basis for jurisdiction under Florida’s long-arm statute, we reverse and remand with directions that the trial court dismiss the Blackmans’ claims without prejudice to their refiling the claims in the appropriate jurisdiction. In light of our conclusion regarding the lack of in personam jurisdiction, the other grounds asserted by Camp Illahee in support of reversal are moot.
Reversed and remanded with directions.
STRINGER, J., and THREADGILL, EDWARD F., SENIOR JUDGE, Concur.
Bernstein v Wysoki et al., 77 A.D.3d 241; 907 N.Y.S.2d 49; 2010 N.Y. App. Div. LEXIS 6579; 2010 NY Slip Op 6475; 244 N.Y.L.J. 43
Posted: February 13, 2012 Filed under: Legal Case, Minors, Youth, Children, New York, Summer Camp, Youth Camps | Tags: Camp, Contract, Forum selection clause, LexisNexis, Medical Malpractice, Motion (legal), New York, New York Supreme Court, New York Supreme Court Appellate Division, Summer Camp, Supreme Court 1 CommentBernstein v Wysoki et al., 77 A.D.3d 241; 907 N.Y.S.2d 49; 2010 N.Y. App. Div. LEXIS 6579; 2010 NY Slip Op 6475; 244 N.Y.L.J. 43
Jordan Bernstein, an Infant, by His Mother and Natural Guardian, Malka Bernstein, et al., Respondents, v Randee Wysoki et al., Appellants, et al., Defendants. (Index No. 20686/07)
2008-06606, 2008-09740
SUPREME COURT OF NEW YORK, APPELLATE DIVISION, SECOND DEPARTMENT
77 A.D.3d 241; 907 N.Y.S.2d 49; 2010 N.Y. App. Div. LEXIS 6579; 2010 NY Slip Op 6475; 244 N.Y.L.J. 43
August 24, 2010, Decided
PRIOR HISTORY: Appeals from orders of the Supreme Court, Nassau County (Thomas P. Phelan, J.), entered June 13, 2008 and September 30, 2008. The order entered June 13, 2008, insofar as appealed from, denied that branch of the cross motion of defendants Randee Wysoki, Dina Farrell, Michael Farrell and Gregory Scagnelli to dismiss the complaint insofar as asserted against them pursuant to CPLR 3211 (a) (1) and 501 based on a forum selection clause. The order entered September 30, 2008, insofar as appealed from, upon reargument, adhered to the original determination and denied that branch of the cross motion of defendant Julie Higgins which was to dismiss the complaint insofar as asserted against her pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause.
Bernstein v. Wysoki, 2008 N.Y. Misc. LEXIS 10774 (N.Y. Sup. Ct., Sept. 26, 2008)
Bernstein v. Wysoki, 2008 N.Y. Misc. LEXIS 9483 (N.Y. Sup. Ct., June 10, 2008)
COUNSEL: [***1] Martin Clearwater & Bell, LLP, New York City (William P. Brady, Timothy M. Smith and Stewart G. Milch of counsel), for appellants.
Napoli Bern Ripka, LLP, New York City (Denise A. Rubin of counsel), for respondents.
JUDGES: REINALDO E. RIVERA, J.P., HOWARD MILLER, THOMAS A. DICKERSON, SHERI S. ROMAN, JJ. RIVERA, J.P., MILLER and ROMAN, JJ., concur.
OPINION BY: DICKERSON, J.
OPINION
[*243] [***2] [**51] Dickerson, J.
Factual Background and the Camp Contract
On or about June 25, 2007 the plaintiff Malka Bernstein (hereinafter Malka) entered into a contract (hereinafter the Camp Contract) with the defendant Camp Island Lake (hereinafter the Camp) for her then 13-year-old son, the plaintiff Jordan Bernstein (hereinafter Jordan), to attend the Camp during summer 2007. The Camp is located in Starrucca, Wayne County, Pennsylvania, where it also maintains a summer office. The Camp maintains a winter office in New York City.
The second paragraph of the Camp Contract provided:
“If it is necessary to obtain off-camp medical/surgical/dental services for the camper, such expenses shall be paid by the parent except the portion supplied by the camp medical staff. Authority is granted without limitation to the camp/assigns in all medical matters to hospitalize/treat/order injections/anesthesia/surgery for the camper. The parent is responsible for all pre-existing medical conditions, out of camp medical/surgical/hospital/pharmaceutical/allergy expenses and for providing [*244] adequate quantities [***3] of necessary medications and allergy serums to camp in pharmacy containers with doctor’s instructions. The parent(s) or legal guardian(s) hereby states that the camper is in good, normal health and has no abnormal physical, emotional, or mental handicaps” (emphasis added).
The Camp Contract also contained a forum selection clause. The sixth paragraph of the Camp Contract provided:
“Enclosed with this agreement is $ 1000 per child enrolled in program. Payments on account of tuition (less $ 100 registration fee) will be refunded if requested before January 1st. Cancellations of sessions will not be accepted after January 1st. Thereafter, no refunds will be made. All refunds will be made on or about May 1st. Installments on the balance will be due on January 1st, March 1st, & May 1st. A returned check fee of $ 25 will be applied to all returned checks. These rates are subject to change without notice. Any outstanding balance precludes admission to camp. The [***4] venue of any dispute that may arise out of this agreement or otherwise between the parties to which the camp or its agents is a party shall be either the local District Justice Court or the Court of Common Pleas, Wayne County, Pennsylvania” (emphasis added).
The eighth and final paragraph of the Camp Contract provided, in part, “[t]he parent represents that he/she has full authority [**52] to enroll the camper/to authorize participation in activities/medical care and to contract the aforesaid.”
On or about August 8, 2007, while enrolled at the Camp, Jordan developed a pain in his lower abdomen. The defendants Randee Wysoki and Jill Tschinkel, who were the doctor and registered nurse, respectively, working at the Camp at the time, allegedly cared for Jordan at the Camp before taking him to the defendant Wilson Memorial Regional Medical Center (hereinafter Wilson Memorial), in Johnson City, Broome County, New York, in the vicinity of the Camp. While at Wilson Memorial from August 8, 2007 through August 10, 2007, Jordan allegedly received care and treatment from the defendants Dina Farrell, M.D., Michael Farrell, M.D., Gregory Scagnelli, M.D., Julie Higgins, R.P.A., Patricia Grant, R.N., and [***5] William Kazalski, R.N. Allegedly due to the failure of the defendants to timely recognize and properly care for and treat Jordan’s condition, he sustained various injuries.
[*245] The Instant Action
In November 2007, Jordan and Malka, both as Jordan’s guardian and in her individual capacity, commenced the instant action, inter alia, to recover damages for medical malpractice in the Supreme Court, Nassau County, against, among others, the Camp, Wilson Memorial, “Randy ‘Doe,’ M.D.,” ” ‘Jane Doe’ R.N.,” Dina Farrell, and Michael Farrell. Thereafter, the plaintiffs amended their complaint to substitute Wysoki for the defendant Randy “Doe,” and to add Scagnelli as a defendant.
After joinder of issue, the Camp moved, inter alia, to dismiss the complaint insofar as asserted against it pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause in the Camp Contract.
The plaintiffs moved for leave to serve an amended summons and complaint to add Higgins and Jill Tschinkel, R.N., as defendants.
The defendants Grant, Kazalski, and Wilson Memorial jointly cross-moved to change the venue of the action from Nassau County to Broome County pursuant to CPLR 510 and 511 (a) on the grounds that the defendants [***6] Grant, Kazalski, Dina Farrell, Michael Farrell, Scagnelli, and Higgins worked and/or resided in, or within approximately 10 minutes of, Broome County, and also because Wilson Memorial was located in Broome County.
The defendants Wysoki, Dina Farrell, Michael Farrell, and Scagnelli (hereinafter collectively the doctor defendants) jointly cross-moved, inter alia, to dismiss the complaint insofar as asserted against them pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause in the Camp Contract. The doctor defendants observed that, pursuant to the last paragraph of the Camp Contract, Malka represented that she had the authority to bind Jordan to the Camp Contract. The doctor defendants further pointed out that the Camp Contract “outlined the terms and conditions of [Jordan’s] attendance at the Camp, including any necessary medical care and treatment or care and treatment decisions for [Jordan].” In that regard, according to the doctor defendants, “as all the parties to the instant action either provided care and treatment to [Jordan] at the Camp or at [Wilson Memorial] based on the Camp’s decision as to what care and treatment [Jordan] needed to receive, any litigation [***7] between the parties in this matter is subject to the terms and conditions of the [Camp Contract].”
[*246] Specifically, the doctor defendants argued that Wysoki was covered by the Camp Contract because she “was the physician working at the Camp who sent [Jordan] to [Wilson Memorial]” and thus “is part of this lawsuit through her work at [**53] the Camp.” The doctor defendants further argued that Dina Farrell, Michael Farrell, and Scagnelli were covered by the Camp Contract because they “treated [Jordan] at [Wilson Memorial] pursuant to the Camp’s decision as ‘in loco parentis’ and with the authority granted to the Camp . . . to have [Jordan] treated at a hospital” and thus “became involved in the care and treatment of [Jordan] based on the decision made of the Camp to take [Jordan] to [Wilson Memorial].”
The doctor defendants also argued that the Camp Contract contained a prima facie valid forum selection clause that should be enforced “absent a strong showing that it should be set aside.” The doctor defendants further argued that the forum selection clause, which by its terms applied to “any dispute that may arise out of this agreement or otherwise between the parties to which the camp or its agents [***8] is a party,” applied to the instant action, since the plaintiffs’ tort claims depended on the existence of the Camp Contract. In that regard, the doctor defendants noted that “there would be no [tort claims] had [Jordan] not been a camper at the Camp during the Summer of 2007,” and that Jordan “would not have been a camper at the Camp without the terms and conditions of the [Camp Contract] being accepted and agreed to by [Malka].” Finally, the doctor defendants “noted that the Courts have held that [HN1] non-parties to an agreement containing a forum selection clause may be entitled to enforce a forum selection clause where the relationship to the signatory is sufficiently close or where the liability of a corporation and an officer is based on the same alleged acts” (citations omitted).
In an order entered June 13, 2008, the Supreme Court, inter alia, denied that branch of the Camp’s motion which was to dismiss the complaint insofar as asserted against it based on the forum selection clause, denied that branch of the doctor defendants’ cross motion which was to dismiss the complaint insofar as asserted against them based on the forum selection clause, and granted the plaintiffs’ motion for [***9] leave to serve an amended summons and complaint (2008 N.Y. Misc. LEXIS, 9483, 2008 NY Slip Op 31711[U]).
The doctor defendants appeal, as limited by their brief, from so much of the foregoing order as denied that branch of their cross motion which was to dismiss the complaint based on the forum selection clause.
[*247] The Camp moved for leave to reargue that branch of its motion which was to dismiss the complaint insofar as asserted against it based on the forum selection clause. The Camp argued that the Supreme Court “blurred the distinctions between [a parent’s] legal ability to bind an infant plaintiff to the terms of a forum selection clause as opposed to a release of liability,” and that, “contrary to a release of liability, the law permits a parent of a minor child who signs a contract with a forum selection clause to bind the minor child to the terms and agreements set forth by the forum selection clause.”
The doctor defendants moved, inter alia, for leave to reargue that branch of their cross motion which was to dismiss the complaint insofar as asserted against them based on the forum selection clause. The doctor defendants argued that the Supreme Court erred in finding that Malka could not bind Jordan to the terms of the Camp Contract, [***10] including the forum selection clause, stating, “[t]he Courts have consistently held that non-signatory infants, who are the subject of and obtain benefit from an agreement signed by the parent, such as a camp enrollment contract, are considered to be third-party beneficiaries for the purpose of enforcing the terms of the contract.” Therefore, according to the doctor defendants, because Jordan “was a [**54] third-party beneficiary of the [Camp Contract] and as the forum selection clause in the [Camp Contract] is valid, the forum selection clause must be found to be applicable to [Jordan’s] claims as well as [Malka’s claims].”
The doctor defendants further argued that the Supreme Court erred in finding “that there was no factual predicate for the foreseeable enforcement [of the forum selection clause in the Camp Contract] by the non-signatory [doctor defendants].” Specifically, noting that the Camp Contract granted authority ” ‘without limitation to the camp/assigns in all medical matters to hospitalize/treat/order injections/anesthesia/surgery for the camper,’ ” the doctor defendants argued that the Camp “contract itself contemplated and provided the factual predicate for the medical treatment [***11] at issue.”
The doctor defendants argued that they “are exactly the ‘assigns’ that were contemplated by the [Camp Contract], as the same sentence in the contract states that the assigns may ‘hospitalize/treat’ [Jordan] and/or ‘order injections/anesthesia/surgery’ for [Jordan].” Thus, according to the doctor defendants, “the [Camp Contract] is the only mechanism by which [they as non-signatories] were able to ‘hospitalize/treat’ [Jordan] [*248] and, thus, the [Camp Contract] is the only mechanism by which there are claims for the non-signatory hospitalization and treatment at issue.”
The doctor defendants further argued that “there was a sufficiently ‘close relationship’ between the signatories to the [Camp Contract] and the non-signatory [doctor] defendants, to reasonably foresee that [the doctor defendants] or noted ‘assigns’ in the contract would seek to enforce the terms of the contract” (emphasis omitted).
Finally, regarding Wysoki in particular, the doctor defendants argued that the Supreme Court erred in finding “that the same acts are not alleged with regard to the claimed liability of the Camp and Dr. Wysoki.”
At some point in time, the plaintiffs served a supplemental summons and a second [***12] amended summons and complaint, inter alia, adding Higgins as a defendant. Higgins moved, inter alia, to dismiss the complaint insofar as asserted against her based on the forum selection clause.
In an order entered September 30, 2008, the Supreme Court, inter alia, granted leave to reargue to both the Camp and the doctor defendants, and, upon reargument, adhered to its original determination denying the respective branches of the Camp’s motion and the doctor defendants’ cross motion which were to dismiss the complaint insofar as asserted against them based on the forum selection clause (2008 N.Y. Misc. LEXIS,10774, 2008 NY Slip Op 33610[U]). The Supreme Court also denied that branch of Higgins’ motion which was to dismiss the complaint insofar as asserted against her based on the forum selection clause.
The doctor defendants appeal from so much of the second order as, upon reargument, adhered to the original determination denying that branch of their cross motion which was to dismiss the complaint based on the forum selection clause, and Higgins jointly appeals from so much of the same order as denied that branch of her motion which was to dismiss the complaint insofar as asserted against her based on the forum selection clause.
Discussion
[HN2] ” ‘A [***13] contractual forum selection clause is prima facie valid and enforceable unless it is shown by the challenging party to be unreasonable, unjust, in contravention of public policy, invalid due to fraud or overreaching, or it is shown that a trial in the [*249] selected forum would be so gravely difficult that the challenging party would, [**55] for all practical purposes, be deprived of its day in court’ ” (Stravalle v Land Cargo, Inc., 39 AD3d 735, 736, 835 NYS2d 606 [2007], quoting LSPA Enter., Inc. v Jani-King of N.Y., Inc., 31 AD3d 394, 395, 817 NYS2d 657 [2006]; see Harry Casper, Inc. v Pines Assoc., L.P., 53 AD3d 764, 765, 861 NYS2d 820 [2008]; Fleet Capital Leasing/Global Vendor Fin. v Angiuli Motors, Inc., 15 AD3d 535, 790 NYS2d 684 [2005]).
[HN3] ” ‘Absent a strong showing that it should be set aside, a forum selection agreement will control’ ” (Horton v Concerns of Police Survivors, Inc., 62 AD3d 836, 836, 878 NYS2d 793 [2009], quoting Di Ruocco v Flamingo Beach Hotel & Casino, 163 AD2d 270, 272, 557 NYS2d 140 [1990]).
The Forum Selection Clause Is Prima Facie Valid and Enforceable
In Horton v Concerns of Police Survivors, Inc. (62 AD3d 836-837, 878 NYS2d 793 [2009]), considering a forum selection clause under similar circumstances, we concluded,
“Here, the plaintiff failed to make the requisite ‘strong showing’ that the forum selection clause in her employment [***14] agreement, which requires disputes to be decided in the courts of the State of Missouri, should be set aside. Although the plaintiff averred that she is a single mother who resides with her teenaged daughter in Dutchess County, New York, this claim was insufficient, standing alone, to demonstrate that enforcement of the forum selection clause would be unjust. The plaintiff offered no evidence that the cost of commencing a wrongful discharge action in Missouri would be so financially prohibitive that, for all practical purposes, she would be deprived of her day in court. Moreover, the plaintiff did not allege that the inclusion of a forum selection clause in her employment contract was the product of overreaching, and she did not demonstrate that the clause is unconscionable.” (Citations omitted.)
[1] Similarly, here, the plaintiffs failed to demonstrate that the forum selection clause is unreasonable or unjust, or that a trial in Wayne County, Pennsylvania, would be so gravely difficult that, for all practical purposes, they would be deprived of their day in court. Moreover, the plaintiffs failed to allege, let [*250] alone demonstrate, that the forum selection clause was the [***15] result of fraud or overreaching. Under these circumstances, the plaintiffs failed to make any showing, let alone a strong showing, that the forum selection clause should be set aside on such bases (id.; see Trump v Deutsche Bank Trust Co. Ams., 65 AD3d 1329, 1331-1332, 887 NYS2d 121 [2009]; compare Yoshida v PC Tech U.S.A. & You-Ri, Inc., 22 AD3d 373, 803 NYS2d 48 [2005] [the Supreme Court properly declined to enforce a contractual forum selection clause fixing Tokyo as the forum for any litigation between the parties, since the plaintiff made “a strong showing that a trial in Tokyo would be so impracticable and inconvenient that she would be deprived of her day in court”]).
The Forum Selection Clause Applies to this Action
[2] Further, the forum selection clause applies to the instant tort action. Notwithstanding the placement of the forum selection clause in the sixth paragraph of the Camp Contract, which otherwise pertains to fees, tuition, and refund policies, the applicability of the forum selection clause does not turn on the type or nature of the dispute between the parties. Rather, by its express language, the forum selection clause applies to “any dispute that may arise out of this agreement or otherwise between the [***16] parties to which the camp or its agents is a party” (see [**56] Tourtellot v Harza Architects, Engrs. & Constr. Mgrs., 55 AD3d 1096, 1097-1098, 866 NYS2d 793 [2008] [rejecting the defendant’s claim that the subject forum selection clause in its agreement with the third-party defendant ” ‘was never intended to apply to third-party claims in personal injury and products liability actions such as . . . plaintiff’s action here,’ (since) under its broad and unequivocal terms, the applicability of the subject forum selection clause does not turn on the type or nature of the dispute between them; rather, it applies to ‘any dispute arising under or in connection with’ their agreement”]; see also Buhler v French Woods Festival of Performing Arts, 154 AD2d 303, 304, 546 NYS2d 591 [1989] [in a personal injury action to recover damages for negligence, the plaintiffs were bound by a forum selection clause in a camp enrollment contract which provided that “(t)he venue of any dispute that may arise out of this agreement or otherwise between the parties to which the camp or its agents is a party shall be either the Village of Hancock, N.Y. Justice Court or the County or State Supreme Court in Delaware County”]).
Jurisdiction and Venue
[3] Moreover, the forum [***17] selection clause is enforceable as a general matter even though it does not include any language [*251] expressly providing that the plaintiffs and the Camp intended to grant exclusive jurisdiction to Pennsylvania. The forum selection clause relates to both jurisdiction and venue, and employs mandatory venue language, providing that the venue of any dispute arising out of the agreement or otherwise between the parties “shall be either the local District Justice Court or the Court of Common Pleas, Wayne County, Pennsylvania.” Accordingly, since the forum selection clause addresses jurisdiction and contains mandatory venue language, the clause fixing venue is enforceable (see Fear & Fear, Inc. v N.I.I. Brokerage, L.L.C., 50 AD3d 185, 187, 851 NYS2d 311 [2008]; John Boutari & Son, Wines & Spirits, S.A. v Attiki Importers & Distribs. Inc., 22 F3d 51, 52 [1994]).
Enforceability of Forum Selection Clause by Nonsignatories
Notwithstanding the fact that the forum selection clause is prima facie valid and enforceable and applicable to the instant tort action as a general matter, this Court must further determine whether the defendant doctors and Higgins, who are not signatories to the Camp Contract, may enforce the forum selection clause.
[HN4] As [***18] a general rule, “only parties in privity of contract may enforce terms of the contract such as a forum selection clause found within the agreement” (Freeford Ltd. v Pendleton, 53 AD3d 32, 38, 857 NYS2d 62 [2008]; see ComJet Aviation Mgt. v Aviation Invs. Holdings, 303 AD2d 272, 758 NYS2d 607 [2003]). However,
[HN5] “there are three sets of circumstances under which a non-party may invoke a forum selection clause: First, it is well settled that an entity or individual that is a third-party beneficiary of the agreement may enforce a forum selection clause found within the agreement. Second, parties to a ‘global transaction’ who are not signatories to a specific agreement within that transaction may nonetheless benefit from a forum selection clause contained in such agreement if the agreements are executed at the same time, by the same parties or for the same purpose. Third, a nonparty that is ‘closely related’ to one of the signatories can enforce a forum selection clause. The relationship between the nonparty and the signatory in such cases must be sufficiently close so that enforcement of the clause is foreseeable by [**57] virtue of the relationship between them.” (Freeford Ltd. v Pendleton, 53 AD3d at 38-39 [citations [*252] omitted]; see Direct Mail Prod. Servs. v MBNA Corp., 2000 US Dist LEXIS 12945, *8, 2000 WL 1277597,*3 [SD NY 2000]; [***19] cf. EPIX Holding Corp. v Marsh & McLennan Cos., Inc., 410 NJ Super 453, 463, 982 A2d 1194, 1200 [2009] [“It is clear that in certain situations, a non-signatory to an arbitration agreement may compel a signatory to arbitrate. Since arbitration agreements are analyzed under traditional principles of state law, such principles allow a contract to be enforced by or against nonparties to the contract through assumption, piercing the corporate veil, alter ego, incorporation by reference, third-party beneficiary theories, waiver and estoppel” (citations and internal quotation marks omitted)].)
[4] Here, relying on the provision in the Camp Contract by which the plaintiffs granted authority to the Camp and to its “assigns” in all medical matters, inter alia, to hospitalize and treat Jordan, Dina Farrell, Michael Farrell, Scagnelli, and Higgins claim to have a sufficiently close relationship with the Camp such that enforcement of the forum selection clause by them was foreseeable to the plaintiffs by virtue of that relationship. Significantly, however, there is nothing in the Camp Contract indicating that the Camp intended to use Dina Farrell, Michael Farrell, Scagnelli, and Higgins in particular in [***20] the event Jordan required “off-camp” medical services. In fact, there is nothing in the Camp Contract indicating that the Camp intended to use Wilson Memorial–located in a different state from the Camp–and its physicians and physician assistants in the event Jordan required medical services.
Under these circumstances, Dina Farrell, Michael Farrell, Scagnelli, and Higgins do not have a sufficiently close relationship with the Camp such that enforcement of the forum selection clause by them was foreseeable to the plaintiffs by virtue of that relationship (cf. Freeford Ltd. v Pendleton, 53 AD3d at 40-41 [“Even a cursory examination of these two agreements makes clear that (defendants) Lane Pendleton and Cairnwood Management had every reason to foresee that (plaintiff) Freeford would seek to enforce the forum selection clause against them”]; Dogmoch Intl. Corp. v Dresdner Bank, 304 AD2d 396, 397, 757 NYS2d 557 [2003] [“(a)lthough defendant was a nonsignatory to the account agreements, it was reasonably foreseeable that it would seek to enforce the forum selection clause given the close relationship between itself and its (signatory) subsidiary”]; Direct [*253] Mail Prod. Servs. v MBNA Corp., 2000 US Dist LEXIS 12945, *10-14, 2000 WL 1277597, *4-5 [***21] [where “a number of . . . clauses in the Agreement between (plaintiff) Direct Mail and (nonparty) MBNA Direct indicate that the signatories intended the contract to benefit related (nonsignatory defendant) MBNA companies,” MBNA Corporation and MBNA America Bank, N.A., were sufficiently closely related to MBNA Direct such that it was foreseeable that they would seek to enforce a forum selection clause contained in the subject agreement]).
[5] Conversely, however, we conclude that Wysoki, as an employee of the Camp, is entitled to enforce the forum selection clause despite her status as a nonsignatory to the Camp Contract. The forum selection clause itself applies to “any dispute that may arise out of this agreement or otherwise between the parties to which the camp or its agents is a party” (emphasis added). Moreover, we find that the [**58] Camp’s relationship with Wysoki, its on-site medical employee, was “sufficiently close so that enforcement of the clause [was] foreseeable by virtue of the relationship between them” (Freeford Ltd. v Pendleton, 53 AD3d at 39). Thus, Wysoki, despite being a nonsignatory to the Camp Contract, was entitled to enforce the valid forum selection clause. Accordingly, [***22] the Supreme Court should have granted that branch of the doctor defendants’ cross motion which was to dismiss the complaint insofar as asserted against Wysoki based on the forum selection clause.
Conclusion
The Supreme Court properly denied that branch of Higgins’ motion which was to dismiss the complaint insofar as asserted against her pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause. However, the Supreme Court improperly, upon reargument, adhered to its prior determination denying that branch of the doctor defendants’ cross motion which was to dismiss the complaint insofar as asserted against Wysoki pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause.
Accordingly, the appeal from the order entered June 13, 2008 is dismissed, as that order was superseded by the order entered September 30, 2008, made upon reargument. The order entered September 30, 2008 is modified, on the law, by deleting the provision thereof, upon reargument, adhering to the determination in the order entered June 13, 2008, denying that branch of the doctor defendants’ cross motion which was to dismiss the complaint insofar as asserted against Wysoki pursuant to CPLR 3211 (a) (1) [***23] and 501 based on the forum selection clause and substituting therefor a provision, upon reargument, vacating the determination in the order entered June 13, 2008 denying that branch of the doctor defendants’ cross motion which was to dismiss the complaint [*254] insofar as asserted against Wysoki pursuant to CPLR 3211 (a) (1) and 501 based on the forum selection clause and thereupon granting that branch of the cross motion. As so modified, the order entered September 30, 2008 is affirmed insofar as appealed from.
Rivera, J.P., Miller and Roman, JJ., concur.
Ordered that the appeal from the order entered June 13, 2008 is dismissed, without costs or disbursements, as that order was superseded by the order entered September 30, 2008, made upon reargument; and it is further,
Ordered that the order entered September 30, 2008 is modified, on the law, by deleting the provision thereof, upon reargument, adhering to the determination in the order entered June 13, 2008, denying that branch of the cross motion of the defendants Randee Wysoki, Dina Farrell, Michael Farrell, and Gregory Scagnelli which was to dismiss the complaint insofar as asserted against Randee Wysoki pursuant to CPLR 3211 (a) (1) and [***24] 501 based on a forum selection clause and substituting therefor a provision, upon reargument, vacating the determination in the order entered June 13, 2008, denying that branch of the cross motion of the defendants Randee Wysoki, Dina Farrell, Michael Farrell, and Gregory Scagnelli which was to dismiss the complaint insofar as asserted against Randee Wysoki pursuant to CPLR 3211 (a) (1) and 501 based on a forum selection clause and thereupon granting that branch of the cross motion; as so modified, the order entered September 30, 2008, is affirmed insofar as appealed from, without costs or disbursements.
Jurisdiction in Massachusetts allows a plaintiff to bring in Salomon France to the local court.
Posted: January 9, 2012 Filed under: Jurisdiction and Venue (Forum Selection), Massachusetts, Skiing / Snow Boarding | Tags: Due Process, Lawsuit, Litigation, Long-Arm Jurisdiction, Massachusetts, Motion (legal), Plaintiff, Product liability, Salomon North America, Ski binding, Summary judgment Leave a commentLafond v. Salomon North America Inc. et al, Superior Court County of Suffolk, Commonwealth of Massachusetts.
Although not a Precedent setting decision, it is indicative of where the courts are going.
This is a decision in the trial court of Massachusetts over ski bindings. The bindings broke injuring the plaintiff while he was skiing in Utah. He sued Salomon in the US and Salomon SAS, the French parent company based on Annecy France. The retailer, Bob Smith’s Wilderness House was brought in as a third party defendant.
The defendants filed a Motion to Dismiss, or what is referred to as a Rule 12(b)(2) motion. A Motion to Dismiss is granted only if the pleadings of the plaintiff do not state a legal claim or the defendant can’t be sued in this case. No evidence is reviewed by the court; it is purely a simple legal argument based on the laws of procedure.
Salomon SAS argued that it had no business in France, did no business in any country other than with Salomon North America based in Ogden Utah. Therefore, because it did no business in Massachusetts, it should not be brought into the litigation in Massachusetts.
So?
Image via Wikipedia
The plaintiff claimed it went to the Salomon SAS website to research different bindings. The Salomon SAS website directed the plaintiff to the third party defendant Bob Smith’s Wilderness House as a retailer the plaintiff could from whom he could purchase the bindings.
The broken bindings were replaced by Salomon, although it is not known in the motion if it was Salmon SAS or Salomon North America.
The issue is whether court has the legal right to require a defendant to submit to its jurisdiction. The limits or requirements the court must follow are set usually set out in a long-arm statute. That is the name given to the statute that controls whether the long arm of the law can extend outside of the state.
To exercise out of state jurisdiction over a defendant located in another state or country the defendant must have engaged in “purposeful and successful solicitation of business from Massachusetts residents.”
A website alone is not enough to bring a foreign or out of court defendant into the jurisdiction of a Massachusetts court. However, because the plaintiff identified the store where he purchased the bindings based on his actions on the Salomon SAS website that was enough to subject the foreign defendant to the jurisdiction of the Massachusetts court.
There are numerous other tests the court must review to subject a foreign business the jurisdiction of the court. However, this one act of directing the plaintiff to a local retailer was enough to subject the defendant to the jurisdiction of the Massachusetts court.
So Now What?
This is a crap decision. When a website brings you into court, a website alone, the purpose of long arm statutes has faded considerably.
However, this is just the first step in a long line of steps before the case is decided. Rarely is a Rule 12(b)(2) motion granted. Motions for Summary Judgment, other defense motions and a trial are all next, then appeals. Hopefully, an appellate court will look at this say the original decision must be overturned.
What can you do? In this case, maybe not a lot can be done, but there are something’s that might assist in some circumstances.
In every sale or contract, put into the agreement a jurisdiction and indemnification clause. You can use them in retail sales agreements with consumers, to some extent.
You also might consider an indemnification agreement between your US based distributor and yourself if you are a foreign, non US based, manufacture. The agreement would say that you would be 100% indemnified for any US based lawsuits, other than product recalls. This might encourage US plaintiff’s not to drag you into a US court.
Make sure your agreement with your US based distributor is not a big target for lawsuits. Identify when the inventory transfers to the US subsidiary and when payment is owed for the inventory.
Set up a defense program with your US Distributor, Reps and all retailers. The program should incorporate the use of a release. The program should make sure three things happen to help eliminate several of the issues in this case.
1. It requires the use of a release by all parties at all times. You can even put one on your website. Releases are not 100% effective in product liability cases, but their jurisdiction and venue clauses may at least get the suit back to your home state.
2. The agreement identifies who shall be protected who and for what reasons. The manufacture of a product in a product liability claim is going to be holding the bag in most cases so this is not a big deal. More importantly it keeps the retailer in your camp in litigation and prevents the embarrassment of brining in the retailer as a third party defendant, making them mad and making you look bad, that occurred in this case.
3. It requires the retailer to notify you immediately of any problems so you can get ahead of the curve.
4. It puts you in control of your litigation destiny and makes you look like the good guy when you are sued to all distributors and retailers in the industry.
For more cases on Jurisdiction and Venue see:
The legal relationship created between manufactures and US consumers
Four releases signed and all of them thrown out because they lacked one simple sentence!
What do you think? Leave a comment.
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