United States Court of Appeals

For the Eighth Circuit

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No. 16-1949

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City of Benkelman, Nebraska, A Political Subdivision

lllllllllllllllllllll Plaintiff - Appellant

v.

Baseline Engineering Corporation, A Colorado Corporation

lllllllllllllllllllll Defendant - Appellee

Layne Christensen Company, a Delaware Corporation

lllllllllllllllllllll Defendant

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Appeal from United States District Court 

for the District of Nebraska - North Platte

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 Submitted: August 1, 2017

 Filed: August 11, 2017

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Before RILEY, BEAM, and SHEPHERD, Circuit Judges.

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SHEPHERD, Circuit Judge. 

A rural Nebraska community seeks federal review of its multi-million dollar

claims against a Colorado corporation. A United States District Court in Nebraska
determined that it lacked jurisdiction over the claims and issued a final judgment

1

ordering the partiesto proceed to arbitration in Colorado. With jurisdiction under 28

U.S.C. § 1291, we reverse and remand for further proceedings. 

I.

The City of Benkelman is a community of less than one thousand residents

located in Dundy County, Nebraska. In 2005, the state health and human services

department ordered the City to address the excessive amounts of uranium, arsenic,

and other contaminants in the City’s drinking water supply. The City subsequently

contracted with Baseline Engineering Corporation, a Colorado organization, to assist

with the permitting, design, and construction of a water treatment plant for the City. 

The City obtained partial funding for the project from the United States Department

of Agriculture - Rural Development (“USDA-RD”). 

The project began in July 2009 and the plant was operating by May 2012. In

June 2012, however, laboratory tests of treated water samples showed that the

uranium levels still did not comply with federal drinking water standards. Around

five months later, the state denied final approval of the plant for failure to effectively

treat the City’s water supply.

The City sued Baseline in federal court in Nebraska, alleging breach of 2

contract, negligence and professional malpractice, fraud, and negligent

misrepresentation. Seeking damagesin excess of $5.5 million, the complaint averred

that Baseline failed to properly design the treatment plant, misrepresented itself as a

See Fed. R. Civ. P. 54(b). 1

The City also sued Layne Christensen Company, which the City had hired to 2

furnish labor, equipment, and materials for the plant. Layne is not a party to this

appeal. 

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water engineering expert, and gave false information about how to bring the City’s

water supply into compliance with state and federal laws. 

Baseline moved to dismiss the complaint. Citing generally Federal Rule of

Civil Procedure 12(b), Baseline argued that the district court lacked jurisdiction due

to a dispute resolution provision in a contract that both partiessigned on or about July

21, 2009 (the “July 2009 Contract”). Under the July 2009 Contract, if the parties

cannot resolve a dispute through a “a face-to-face meeting,” the dispute must be

“submitted to binding arbitration . . . conducted at a suitable location within 15 miles

of [Baseline’s] then existing principal office. The arbitration shall be completed

pursuant to the Uniform Arbitration Act, C.R.S. § 13-22-201, et seq., and governed

by the provisions of the Colorado Rules of Civil Procedure, before a single arbiter.”

The July 2009 Contract further provides that, if the parties waive arbitration or if the

arbitration provision isinvalidated or does not apply, “venue for any court proceeding

will be the District Court for Jefferson County, State of Colorado.” 

3

The City opposed Baseline’s motion, arguing that the July 2009 Contract does

not control because it was superseded by a second contract that the parties signed on

Baseline’s motion to dismiss further asserted that, on the same day the City 3

commenced federal litigation, Baseline filed a demand for arbitration in Colorado

seeking to recover an outstanding balance that the City allegedly owed under the July

2009 Contract. The parties dispute the current status of the Colorado arbitration

proceedings. According to the City, after the City objected to arbitration the arbiter

stayed the matter to allow the federal district court to determine whether a binding

arbitration agreement exists. By contrast, Baseline contends that the arbiter did not

stay the arbitration proceedings but that, after the City objected, the arbiter declined

to accept jurisdiction and directed resolution of the jurisdictional dispute to a court

of competent jurisdiction. Under either view, at this time the parties are not actively

involved in arbitration proceedings. 

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or slightly before August 27, 2009 (the “August EJCDC Agreement”). The August

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EJCDC Agreement, comprised of thirteen pages and ten exhibits, is a standard form

contract prepared by the Engineers Joint Contract Documents Committee (the

“EJCDC”). The City claims that, because the treatment plant was funded in part by

USDA-RD, the parties were required to execute the EJCDC agreement and have it

approved by USDA-RD. Indeed, in a letter dated August 28, 2009, Baseline

submitted the parties’ signed August EJCDC Agreement to the USDA-RD, and the

Agreement was approved on October 5, 2009. Because paragraph 6.01K of the

August EJCDC Agreement states that “[a]ll [c]ontract [d]ocuments . . . shall be

subject to [a]gency concurrence,” the City argues that the July 2009 Contract (which

was not sent to USDA-RD for approval) simply memorialized the parties’ initial

agreement but waslater replaced asthe governing document by the agency-approved

August EJCDC Agreement.

The August EJCDC Agreement has its own arbitration provision, although the

provision is not mandatory and is triggered only if a dispute survives the parties’

good faith negotiation and mediation. In such an event the August EJCDC

Agreement statesthat “either party may seek to have the [d]ispute resolved by a court

of competent jurisdiction.” Alternatively, if less than $200,000 isin controversy, the

dispute may be resolved by a method mutually agreed upon by the parties, “including

but not limited to arbitration.”

In addition to conflicting arbitration and forum selection clauses, the July and

August contracts contain the following terms relevant to Baseline’s motion to

dismiss:

Though the signatures on the August EJCDC Agreement are dated August 17,

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2009, and August 27, 2009, page one of the Agreement states that it is effective as of

July 20, 2009. 

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(1) Incorporation by reference. Though the August EJCDC Agreement was

signed around a month after the July 2009 Contract, it is twice incorporated by

reference as “Exhibit B” to the July 2009 Contract. First, page 1 of the July 2009

Contract contains a box titled “Job Description” followed by an instruction to “[s]ee

Exhibit B hereto - for accompanying EJCDC agreement.” Second, a provision on

page 3 titled “Entire Contract” states, “Exhibits A and B hereto are incorporated into

this Agreement as fully set forth herein.” 

(2) Choice-of-law. The July 2009Contract contains a choice-of-law provision

stating that the parties’ agreement “shall be governed by the laws of the State of

Colorado.” Under the August EJCDC Agreement, however, “the law of the state in

which the Project is located”—Nebraska—controls. 

(3) Merger clauses. Each contract purports to represent the entire agreement

between the parties and to trump any prior or inconsistent agreements. The July 2009

Contract states: 

This Agreement and the documents set forth in Exhibits A and B hereto

shall supersede any other contract between [the City] and [Baseline],

relating to the subject matter thereof. This is a fully integrated Contract. 

Any previous statements, representations, agreements, negotiations or

discussions are null and void, and are fully merged herein. In case of a

conflict orinconsistency between this Agreement and any other contract

documents, this Agreement shall control. [Baseline] makes no promises

or agreements written or oral except for the provisions herein set forth. 

The August EJCDC Agreement likewise states:

This Agreement (consisting of pages 1 to 13, inclusive, together with the

exhibits identified above) constitutes the entire agreement between [the

City] and [Baseline] for the Project and supersedes all prior written or

oral understandings.

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In considering Baseline’s motion to dismiss, the district court first determined

that, although the motion cited only generally Rule 12(b), it should be construed as

a Rule 12(b)(1) motion to dismiss for lack of jurisdiction. The court looked beyond

the motion’s caption to its content, which argued that the court “lacks jurisdiction”

and that “this [c]ourt’s jurisdiction is limited to enforcing the valid and enforceable

forum selection clause in the [c]ontract.” (internal quotation marks omitted). 

Next, applying Rule 12(b)(1), the court characterized the motion as a factual

challenge to subject matter jurisdiction (as opposed to a facial challenge) because

Baseline accompanied the motion with exhibits that offered factual information not

appearing in the City’s complaint. See Branson Label, Inc. v. City of Branson, 793

F.3d 910, 914-15 (8th Cir. 2015) (discussing the difference in factual and facial

challenges to subject matter jurisdiction). This led the court to decide that, as the

nonmoving party in a Rule 12(b)(1) factual challenge, the City (1) has “the burden of

proof that jurisdiction does in fact exist,” and (2) is afforded “no presumptive

truthfulness” with respect to its allegations. See Osborn v. United States, 918 F.2d

724, 730 (8th Cir. 1990) (internal quotation marks omitted).

The district court then considered which contract governs the parties’ dispute. 

Applying state-law principles of contract interpretation, the court concluded that

“[t]he contracts in this case must be construed as one because they involve the same

parties and same transaction, and because the July 2009 Contract expressly statesthat

it incorporates the EJCDC Agreement into it as ‘Exhibit B.’” The court noted,

however, that construing the two documents as one contract brings to light the

inconsistencies between the various provisions. Citing Colorado and Nebraska law,5

See David Fiala, Ltd. v. Harrison, 860 N.W.2d 391, 397 (Neb. 2015); JTS 5

Choice Enterprises, Inc. v. E.I. Dupont De Nemours & Co., No. 11-cv–03143, 2013

WL 154421, at *3-4 (D. Colo. Jan. 15, 2013). 

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the court concluded that (1) the inconsistent provisionsrender the contract ambiguous

and (2) extrinsic evidence may therefore be considered in order to discern the parties’

intent. 

The only extrinsic evidence was presented for the first time with Baseline’s

reply brief supporting the motion to dismiss. The affidavit ofBaseline President John

McLain and attachment revealed that in June 2011—two years into the project—the

parties executed three orders expanding their initial agreement to include additional

engineering services (the “2011 Change Orders”). Each order (1) specifically

references and quotes the “Additional Work” clause set forth in the July 2009

Contract and (2) states that “[a]ll [a]dditional [w]ork will be performed under and

considered an extension of the above mentioned Agreement.” The district court held

that the 2011 Change Orders are extrinsic evidence indicating that the parties

intended “that the July 2009 Contract remain operative, controlling, and not

superseded by the attached EJCDC Agreement.” 

Turning to the July 2009 Contract, the court looked to the provision stating:

“In case of a conflict or inconsistency between this Agreement and any other contract

documents, this Agreement shall control.” (emphasis added). Thus the court

concluded that “the July 2009Contract‘controls’ the conflicting provisionsregarding

applicable law and arbitration, making Colorado law applicable and requiring the

parties to submit to binding arbitration in Colorado, to be conducted in the fashion

described in the July 2009 Contract.” The court therefore granted Baseline’s Rule

12(b) motion and dismissed the City’s claims against Baselinewithout prejudice. The

court directed that the City’s claims against Baseline proceed to arbitration in

Colorado. 

II.

“We review de novo the grant of a motion to dismiss for lack of subject matter

jurisdiction under Rule 12(b)(1).” Great Rivers Habitat Alliance v. Fed. Emergency

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Mgmt. Agency, 615 F.3d 985, 988 (8th Cir. 2010) (citation omitted) (internal

quotation marks omitted). 

A.

The City argues that the motion cannot be construed as a challenge to the

district court’s subject matter jurisdiction under Rule 12(b)(1). Instead, the City

contends, the motion should be analyzed under either Rule 12(b)(3) as a challenge to

venue, Rule 12(b)(6) as an assertion that the City’s complaint failed “to state a claim

upon which relief can be granted,” or Rule 56 as a motion for summary judgment. 

We first consider the City’s proposal to treat the motion as a motion to dismiss

for improper venue under Rule 12(b)(3). According to the City, arbitration clauses

are substantially similar to forum-selection clauses, and therefore a motion to dismiss

based on an arbitration clause should be treated as a Rule 12(b)(3) objection to venue. 

The City bases its analogy on Scherk v. Alberto-Culver Co., where the Supreme

Court indeed described arbitration agreements as “a specialized kind of forumselection clause.” 417 U.S. 506, 519 (1974).

But the City overlooks more recent Supreme Court precedent that forecloses

its Rule 12(b)(3) argument. Since Scherk, the Supreme Court has expressly held that

parties may not enforce forum-selection clauses through Rule 12(b)(3) motions to

dismiss. Atl. Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex., 134 S.

Ct. 568, 577 (2013). The Court explained, “Rule 12(b)(3) allow[s] dismissal only

when venue is ‘wrong’ or ‘improper.’ Whether venue is ‘wrong’ or ‘improper’

depends exclusively on whether the court in which the case was brought satisfies the

requirements of federal venue laws, and those provisions say nothing about a forumselection clause.” Id.; see also In re Union Elec. Co., 787 F.3d 903, 907 (8th Cir.

2015) (stating that Atlantic Marine “clearly eliminated the possibility of using Rule

12(b)(3) as a means to enforce a forum-selection clause”). Thus, to the extent an

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arbitration provision is like a forum-selection clause, the motion seeking to compel

arbitration is not properly construed under Rule 12(b)(3). 

We next consider the City’s assertion that the district court erred by analyzing

the motion under Rule 12(b)(1). We have previously upheld, on interlocutory appeal,

the denial of a motion to compel arbitration styled as a Rule 12(b)(1) motion to

dismiss. U.S. for Use of Lightning & Power Servs., Inc. v. Interface Constr. Corp.,

553 F.3d 1150, 1152 (8th Cir. 2009). And, as Baseline points out, we have also

upheld the grant of a Rule 12(b)(1) motion to dismiss based on an arbitration clause

contained in a collective bargaining agreement under the Railway Labor Act, a

jurisdiction-stripping statute. Thompson v. Air Transp. Int’l Ltd. Liab. Co., 664 F.3d

723, 725 (8th Cir. 2011). But we have not addressed whether an arbitration

agreement alone—independent of statutory or other binding jurisdictional

limitations—divests the federal courts of subject matter jurisdiction. We hold that it

does not. 

Our decision isinformed by the Supreme Court’s reasoning in Atlantic Marine. 

134 S. Ct. at 577. The Court concluded that federal venue laws, not forum-selection

clauses, govern the propriety of venue under Rule 12(b)(3). Id. The same logic

applies where, as here, a party seeks to enforce an arbitration agreement under Rule

12(b)(1). Just as a forum-selection clause has no bearing on the issue of whether

venue is “wrong” or “improper,” an arbitration agreement has no relevance to the

question of whether a given case satisfies constitutional or statutory definitions of

jurisdiction. See Auto. Mech. Local 701 v. Vanguard Car Rental, 502 F.3d 740, 743

(7th Cir. 2007) (“Enforcement of a forum selection clause (including an arbitration

clause) is not jurisdictional . . . .”); Minn. Supply Co. v. Mitsubishi Caterpillar

Forklift Am., Inc., 822 F. Supp. 2d 896, 904 n.10 (D. Minn. 2011) (“To dismiss a

federal action for lack of subject matter jurisdiction because the dispute is subject to

a binding arbitration agreement mistakenly assumes that an arbitrable dispute, by

definition, falls outside the realm of federal jurisdiction. Moreover, the fact that the

parties have contractually agreed to resolve any particular dispute by arbitration says

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nothing about whether that dispute would satisfy federal question, diversity or any

other basis of subject-matter jurisdiction.”). But see Gilbert v. Donahoe, 751 F.3d

303, 306 (5th Cir. 2014) (“[A] district court lacks subject matter jurisdiction over a

case and should dismiss it pursuant to Federal Rule of Civil Procedure 12(b)(1) when

the parties’ dispute is subject to binding arbitration.”). 

We therefore hold that, contrary to Baseline’s contention, the July 2009

Contract’s arbitration clause does not strip the federal courts of jurisdiction. 

Accordingly, we agree with the City that the district court erred in construing the

motion as a Rule 12(b)(1) challenge to subject matter jurisdiction. 

We are thus left with two alternative classifications: Rule 12(b)(6) (failure to

state a claim) and Rule 56 (summary judgment). 

Baseline offers no reason why Rule 12(b)(6) does not apply. As to Rule 56,

Baseline cites a case from the Eastern District of Virginia and argues that applying

Rule 56 would be prejudicial because the City could claim that Baseline waived its

right to compel arbitration by moving for summary judgment. See Karnette v.

Wolpoff & Abramson, L.L.P., 444 F. Supp. 2d 640, 648 (E.D. Va. 2006). The issue

in Karnette—a non-binding district court opinion—was whether the defendant

waived its right to arbitration by moving for summary judgment for the purpose of

using the plaintiffs’ response to “reassess its chances of winning the case” before

deciding whether to move to compel arbitration. Id. As no such litigation tactics are

at play in this case, we are unmoved by Karnette.

Upon careful review of the relevant authority, we agree with the City that

Baseline’s motion is properly analyzed under either Rule 12(b)(6) or Rule 56. To be

sure, the motion does not sit squarely on all fours with either rule. We are

nonetheless satisfied that, unlike the cases interpreting Rules 12(b)(1) or (b)(3), the

legal authority does not forbid parties from using Rules 12(b)(6) or 56 to enforce an

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arbitration agreement. To the contrary, our sister circuits regularly employ Rules

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12(b)(6) and 56 when deciding whether to compel arbitration. See Guidotti v. Legal

Helpers Debt Resolution, L.L.C., 716 F.3d 764, 771 (3d Cir. 2013); Cnty. of

McHenry v. Ins. Co. of the West, 438 F.3d 813, 817, 821 (7th Cir. 2006); see also

Tinder v. Pinkerton Sec., 305 F.3d 728, 735 (7th Cir. 2002) (citing cases from the

Second, Third, and Fifth Circuits and stating that “courts that have addressed the

question have analogized the . . . evidentiary standard a party seeking to avoid

compelled arbitration must meet . . . to that required of a party opposing summary

judgment”).

We decline to press the matter by deciding between Rule 12(b)(6) and 56,

because summary judgment standards apply either way. In litigating Baseline’s

motion both parties submitted matters outside the pleadings, which the district court

considered when granting the motion. Thus, even if the motion is construed under

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Rule 12(b)(6), it must ultimately “be treated as one for summary judgment under Rule

56.” See Fed. R. Civ. P. 12(d) (“If, on a motion under Rule 12(b)(6) . . . , matters

outside the pleadings are presented to and not excluded by the court, the motion must

be treated as one for summary judgment under Rule 56.”); see also Evans v.

McDonnell Aircraft Corp., 395 F.2d 359, 361 (8th Cir. 1968) (“Since both parties

filed affidavits and exhibits in support of their respective positions, which were not 

To the extentBaseline seeks to enforce the forum-selection clause independent 6

ofthe arbitration agreement, Baseline should have invoked the forum non conveniens

doctrine. See Atlantic Marine, 134 S. Ct. at 580 (“[T]he appropriate way to enforce

a forum-selection clause pointing to a state or foreign forum is through the doctrine

of forum non conveniens.”).

Baseline filed two affidavits and two exhibits along with the motion to 7

dismiss; the City opposed the motion by filing an opposition brief accompanied by

one exhibit; and Baseline replied to the City’s opposition brief with its own brief

supporting the motion accompanied by one attachment, one affidavit, and one exhibit.

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excluded by the District Court, the motion to dismiss should properly have been

treated as one for summary judgment.”). 

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B.

Had the district court analyzed Baseline’s motion as one for summary

judgment, we would review de novo the summary judgment analysis by deciding

whether there are genuine issues of material fact and whether Baseline “is entitled to

a judgment as a matter of law.” See Fed. R. Civ. P. 56(a); see also Jackson v.

Riebold, 815 F.3d 1114, 1119 (8th Cir. 2016) (standard of review for summary

judgment appeal is de novo). However, the district court has not addressed, nor have

the parties had an opportunity to brief, whether Baseline’s motion should succeed

under Rule 56. Were we to adjudicate the merits of the motion, therefore, we would

violate our own general rule against considering issues for the first time on appeal. 

See, e.g., Weitz Co. v. Lloyd’s of London, 574 F.3d 885, 890 (8th Cir. 2009). 

Although our rule is not absolute, we think it best in this case that summary

judgment proceedings—which are inherently fact intensive and may lead the parties

to trial—be held first in the district court. See CMH Homes, Inc. v. Goodner, 729

F.3d 832, 838 (8th Cir. 2013) (indicating that “the district court is better equipped to

address [fact-intensive questions] in the first instance.”); United States v. Smith, 665

F.3d 951, 956 (8th Cir. 2011) (suggesting that “the district court [is] in a far better

position to address” questions of fact than the appellate court). Accordingly, we 

We would reach the same result were we to construe the Rule 12(b) motion

8

as a motion to compel arbitration. See Neb. Mach. Co. v. Cargotec Solutions, LLC,

762 F.3d 737, 741-42 (8th Cir. 2014) (stating that motions to compel arbitration that

are accompanied by attached exhibits and affidavitsshould be treated under summary

judgment standards). 

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reverse the order dismissing the City’s claims against Baseline and remand for

consideration of Baseline’s motion under summary judgment standards. 

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III.

For these reasons, the order of the district court is reversed and the case is

remanded for further proceedings. 

______________________________

Since the parties’ oral arguments on May 11, 2017, the Supreme Court decided

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Kindred Nursing Centers Limited Partnership v. Clark, 137 S. Ct. 1421 (2017). 

Based on language in Part IIB of that intervening opinion regarding the scope of the

Federal Arbitration Act—a statute that neither party invoked before this court—we

ordered supplemental briefing to allow the parties to address whether Part IIB of

Kindred Nursing impacts this case. The partiessubmitted their supplemental briefing

on July 31, 2017. 

After carefully reviewing the supplemental briefs, we decline to rule at this

time on the relevance (if any) of Kindred Nursing to the underlying dispute. The

instant appeal turns on matters of civil procedure, not substantive law. Our holding

is limited to a decision that (1) Baseline’s ambiguous Rule 12(b) motion should be

analyzed under summary judgment standards, and (2) the district court should be the

first to apply those standards. Thus, an analysis by this court of Kindred Nursing

would only splinter legal issues presented in this case which are best adjudicated

collectively in summary judgment proceedings in the district court. 

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