Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-01951/USCOURTS-azd-2_10-cv-01951-0/pdf.json

Nature of Suit Code: 196
Nature of Suit: Franchise
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

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1

 Defendants’ request for oral argument is denied because the issues have been fully

briefed and oral argument will not aid the Court’s decision. See Fed. R. Civ. P. 78(b);

Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998). 

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Tilted Kilt Franchise Operating LLC,

Plaintiff, 

vs.

Jeremy Helper; Bakersfield Kilt, Inc.,

Defendants. 

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No. CV10-1951-PHX-DGC

ORDER

Defendants move to dismiss for failure to state a claim and lack of personal

jurisdiction, and in the alternative for change of venue. Doc. 7. Plaintiff opposes. Doc. 14.

The motions have been fully briefed.1

 Docs. 7, 14, 15. For the reasons stated below, the

Court will deny the motions.

On August 9, 2010, Plaintiff filed an action in Arizona Superior Court for the County

of Maricopa alleging claims of fraud, breach of two contracts, and indemnification.

Doc. 1-1. Defendants removed to this Court (Doc. 1), and now seek dismissal or, in the

alternative, venue transfer (Doc. 7). Defendant Helper resides in California, and Defendant

Bakersfield Kilt, Inc. is a California corporation with its principal place of business in

Bakersfield, California. Doc. 7 at 2. Plaintiff is a Limited Liability Company organized in

Wyoming, with its principal place of business in Tempe, Arizona. Doc. 1-1 at 2.

Case 2:10-cv-01951-SMM Document 17 Filed 12/09/10 Page 1 of 4
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2

 Defendants do not argue that Defendant Bakersfield Kilt, Inc. is not bound by the

franchise agreement.

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Defendants argue that this Court has no personal jurisdiction over them, and that the

complaint violates Rule 8(a)(1) by failing to contain a valid statement of personal

jurisdiction. Doc. 7 at 11. Plaintiff asserts that Defendants consented to jurisdiction in the

franchise agreement signed by Plaintiff and Defendant Helper.2

 Doc. 14 at 2-4. Defendants

reply by arguing that the Arizona forum selection clause in the franchise agreement is

superseded by California law, thereby voiding consent. E.g., Doc. 15 at 1. The Court

disagrees. The franchise agreement expressly states, in addition to setting the venue to

Phoenix, Arizona, that “each party waives any objection they may have to the personal

jurisdiction of . . . state and federal courts of Arizona.” Doc. 1-2 at 11. Moreover, Cal. Bus.

& Prof. Code § 20040.5, cited by Defendants, addresses venue, not personal jurisdiction.

Finally, Defendants have not made the requisite showing of unconscionability with regard

to the personal jurisdiction provision of the agreement. Accordingly, the Court can exercise

personal jurisdiction over Defendants.

Defendants also argue that venue is not proper in this Court because California law

prohibits non-California venue-selection clauses in claims “arising under or relating to a

franchise agreement involving a franchise business operating within [California],” § 20040.5.

Doc. 15 at 5. Plaintiff asserts that venue is proper in Arizona under either 28 U.S.C.

§§ 1441(a) or 1391, independent of the forum selection clause. Doc. 14 at 5-9. The Court

agrees. In this case, § 20040.5 would appear to void the venue-restriction clause of the

franchise agreement. See Jones v. GNC Franchising, 211 F.3d 495, 497-98 (9th Cir. 2000).

Nonetheless, venue is still proper in this Court under § 1441(a) because the case was

removed by Defendants to this Court. 28 U.S.C. § 1441(a); Polizzi v. Cowles Magazines,

Inc., 345 U.S. 663, 665 (1953) (“[t]he venue of removed actions is governed by 28 U.S.C.

[§] 1441(a)”).

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3

 Though Defendants request transfer under 28 U.S.C. § 1406(a) (Doc. 7 at 9), this is

not a situation where the case was brought in the wrong district. The Court will treat the

request as having been made under § 1404(a) because Defendants also reference § 1404(a)

(Doc. 7 at 12:11).

4

 In their reply, however, Defendants argue that it would be a hardship for Defendant

Helper to appear at trial in Arizona because of business and family commitments. Doc. 15

at 5. They also provide a list of potential witnesses who are or may be in California.

Doc. 15-1 at 7-9. Arguments made for the first time in a reply brief are untimely, and the

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Lastly, Defendants urge for a transfer of venue.3

 A district court may transfer a case

to another federal district pursuant to 28 U.S.C. § 1404(a) in the interest of justice or for the

convenience of the parties or witnesses. In exercising its discretion, the court may consider:

(1) the location where the relevant agreements were negotiated and executed,

(2) the state that is most familiar with the governing law, (3) the plaintiff’s

choice of forum, (4) the respective parties’ contacts with the forum, (5) the

contacts relating to the plaintiff’s cause of action in the chosen forum, (6) the

differences in the costs of litigation in the two forums, (7) the availability of

compulsory process to compel attendance of unwilling non-party witnesses,

and (8) the ease of access to sources of proof.

Jones, 211 F.3d at 498-99. The presence of a forum selection clause and the public policy

of the forum state are also significant factors. Id. at 499. Defendants, as the moving parties,

have the burden to show that transfer is proper. See id. (holding that the district court

“did not abuse its discretion in denying the motion to transfer venue under § 1404(a)”

because the defendant had “failed to meet its burden of showing that Pennsylvania was the

more appropriate forum for the action”).

Plaintiff commenced this action in Arizona. Defendant also concedes that the

franchise agreement was executed in Arizona when Defendant Helper traveled from

California to sign the agreement in Plaintiff’s Tempe office. Doc. 15 at 5. Moreover, the

forum’s interest in adjudicating this matter – the forum here being Arizona – is strongest

when one of its residents allegedly suffers harm. See Reiffin v. Microsoft Corp., 104 F. Supp.

2d. 48, 52 (D.D.C. 2000). Finally, in their motion to transfer Defendants offer little more

than conclusory statements alleging that most witnesses and evidence are located in

California.4

 In light of the totality of circumstances, Defendants have not made an adequate

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Court will disregard them. See, e.g., Delgadillo v. Woodford, 527 F.3d 919, 930 n.4 (9th Cir.

2008).

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showing that transfer is proper. Accordingly, the motion to transfer will be denied.

IT IS ORDERED that Defendants’ motions to dismiss and transfer venue (Doc. 7)

are denied.

DATED this 9th day of December, 2010.

Case 2:10-cv-01951-SMM Document 17 Filed 12/09/10 Page 4 of 4