Opinion ID: 2811441
Heading Depth: 2
Heading Rank: 1

Heading: Carter's Challenge to the Procedural Vehicle

Text: Carter's extensively argues in its brief on appeal that Nike cannot use a motion to dismiss under Rule 12(b)(6) to enforce the forum selection clause. Carter's brief relies principally on the Supreme Court's recent decision in Atlantic Marine Construction Co. v. United States District Court for the Western District of Texas, 134 S. Ct. 568 (2013). At oral argument, however, Carter's counsel expressed that Carter's no longer objects to the use of Rule 12(b)(6) by the district court. Thus, we focus on the merits of the district court's dismissal.2 2 Carter's does maintain, however, a procedural argument that, even if a Rule 12(b)(6) motion were appropriate, the district court should have converted the motion sua sponte into one for partial summary judgment to admit Carter's exhibits with evidence concerning the change in Nike's invoice. Yet, Carter's never asked the district court to convert the motion into one for summary judgment or requested an evidentiary hearing. Instead, Carter's argued that the Agreement was an unconscionable and unfair contract of adhesion, and included the exhibits without more. Arguably, -6- B. Enforcement of Forum Selection and Massachusetts Public Policy This Court reviews the enforceability of forum selection clauses employing the Bremen factors. Huffington v. T.C. Grp., LLC, 637 F.3d 18, 23 (1st Cir. 2011) (citing Bremen v. Zapata OffShore Co., 407 U.S. 1, 15-18 (1972)).3 The burden of proof is on the party opposing the enforcement of the forum selection clause. Claudio-De León, 775 F.3d at 48 (citing Bremen, 407 U.S. at 17 Carter's could have also requested leave to amend its Complaint to include the exhibits and establish an alternate theory on the source of its contractual obligations, thereby allowing the district court to consider Carter's arguments and exhibits even under Rule 12(b)(6), or forcing the district court to treat the motion as one for summary judgment under Rule 56. See Rivera, 575 F.3d at 15 (quoting Trans–Spec Truck Serv., Inc. v. Caterpillar, Inc., 524 F.3d 315, 321 (1st Cir.2008)); see also Fed. R. Civ. P. 12(d). Nike correctly contends that Carter's also could have objected to Nike's motion to strike the exhibits, as it was required to do under the local rules for motion practice. See D. Mass. R. 7.1(b)(2) (requiring that [a] party opposing a motion, shall file an opposition within 14 days after the motion is served). Consequently, the district court did not err in failing to convert the motion sua sponte. When opposing a Rule 12(b)(6) motion, a plaintiff cannot expect a trial court to do his homework for him. Rather, the plaintiff has an affirmative responsibility to put his best foot forward in an effort to present some legal theory that will support his claim. McCoy v. Mass. Inst. of Tech., 950 F.2d 13, 22-23 (1st Cir. 1991). 3 Though Carter's does not dispute the applicability of the Bremen analysis, Nike argues for a heightened standard after Atlantic Marine. For the purposes of this case, we will assume the continued applicability of the Bremen analysis to forum selection clauses evaluated under Rule 12(b)(6) since we conclude that the forum selection clause must be enforced even under this analysis. See Claudio-De León v. Sistema Universitario Ana G. Méndez, 775 F.3d 41, 48-49 (1st Cir. 2014); cf. In re Union Elec. Co., No. 14-3276, 2015 WL 3429462, at  n.3 (8th Cir. May 29, 2015). -7- (explaining that the party arguing that a forum selection clause is inapplicable 'bear[s] a heavy burden of proof'))(alteration in original). Under Bremen, we enforce the forum selection clause absent a strong showing that it should be set aside. Bremen, 407 U.S. at 15. A strong showing can exist where: (1) the clause is the product of fraud or overreaching; (2) enforcement is unreasonable and unjust; (3) its enforcement would render the proceedings gravely difficult and inconvenient to the point of practical impossibility; or (4) enforcement contravenes a strong public policy of the forum in which suit is brought, whether declared by statute or judicial decision. Huffington, 637 F.3d at 23 (internal quotation marks omitted). Only the second, third, and fourth factors are at issue in this appeal. Related to the second factor, Carter's argues that Nike inconspicuously inserted the forum selection clause in its invoices without bargain. As to the third factor, Carter's argues that it should not be required to finance a cross country legal battle against an international financial behemoth and that it, as well as other family-owned retailers, would face extreme hardship if forced to go to Oregon. Finally, with regards to the fourth factor, Carter's asserts that the forum selection clause's enforcement contravenes both federal and Massachusetts public policy. We now consider Carter's arguments. -8-
As a preliminary matter, Carter's attempts to narrow the scope of the forum selection clause in two respects. First, Carter's states that Nike unilaterally included the forum selection clause in later invoices, and suggests that the forum selection clause should be limited to issues regarding the goods covered in each of these invoices. Second, Carter's argues that its Chapter 93A claim falls outside the scope of the forum selection clause. [I]t is the language of the forum selection clause itself that determines which claims fall within its scope. Rivera v. Centro Médico de Turabo, Inc., 575 F.3d 10, 19 (1st Cir. 2009). In this case, the language of the forum selection clause is unambiguously broad. The clause, if enforceable, applies to any action arising out of or in connection with the Agreement. (Emphasis added). The clause therefore applies to each of Carter's claims, including the Chapter 93A claim, since each arises out of or in connection with the Agreement and its termination. As relates to the Chapter 93A claim specifically, Carter's argument that the termination was an unfair business practice is clearly connect[ed] with the Agreement. Carter's citation to Jacobson v. Mailboxes Etc. U.S.A., Inc., 646 N.E.2d 741 (Mass. 1995) is inapposite since that case concerned a pre-contractual Chapter 93A claim, which fell outside the scope of a more narrowly worded forum selection clause. See id. at 744-46. -9- Carter's Chapter 93A claim, in contrast, arises from and is clearly connected with the termination of the Agreement itself. See, e.g., Huffington, 637 F.3d at 22 (1st Cir. 2011) (finding a Chapter 93A claim to be within the scope of a forum selection clause). To the extent that Carter's is arguing that the unilateral addition of the forum selection clause is not a valid part of its contract, we reject this argument as waived. Carter's has made no developed argument that the forum selection clause is an unenforceable addition under the U.C.C. Rather, this challenge is presented in a perfunctory and undeveloped manner, and thus, [is] considered waived. Matt v. HSBC Bank USA, N.A., 783 F.3d 368, 373 (1st Cir. 2015) (citing Rodríguez v. Municipality of San Juan, 659 F.3d 168, 175 (1st Cir. 2011); United States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990)).4
Oregon Carter's cites several cases to argue that the forum selection clause should not be enforced because of the hardship caused to a litigant. Carter's first relies on Feeney v. Dell, Inc., 908 N.E.2d 753 (Mass. 2009). In Feeney, the Massachusetts Supreme Judicial Court found an arbitration clause unenforceable 4 To the extent that Carter's argues that the enforcement of the forum selection clause is unreasonable or unjust because it never bargained for it, we remain unpersuaded. If the unilateral addition is a valid part of the contract, its enforcement in this case is neither unreasonable nor unjust. As described above, we find any argument against its validity to be waived. -10- because it contravened Massachusetts public policy favoring class action litigation of Chapter 93A claims. Id. at 761-62. We think the case is inapposite since Carter's has not pursued this case as a class action, and thus it does not implicate the policy. Furthermore, the forum selection clause does not preclude class litigation by its own terms and Carter's has not been impeded from bringing a class action claim in Oregon.5 Carter's next turns to Karlis v. Tradex Swiss AG, No. 073527BLS1, 2007 WL 2705572 (Mass. Super. Ct. Sept. 7, 2007). In Karlis, the Massachusetts Superior Court ruled that a forum selection clause which would have required plaintiffs to litigate in Switzerland was unenforceable. Id. at . The Karlis Court further determined that an intervenor would not have had her day in court if said clause was enforced because she was not a sophisticated party and had allegedly lost her life savings in the Tradex investment at issue. Id. We find that Karlis is likewise not on point. While Carter's may not have the resources of Nike, it is still a multi-million dollar company.6 Thus, as to the third 5 Massachusetts has upheld forum selection clauses which include individual Chapter 93A claims. See, e.g., Cambridge Biotech Corp. v. Pasteur Sanofi Diagnostics, 740 N.E.2d 195, 201-03 & n.7 (Mass. 2000); see also, e.g., Huffington, 637 F.2d at 22. There is no suggestion in this case that the claim would not be honored in Oregon. See Jacobson v. Mailboxes Etc. U.S.A., Inc., 646 N.E.2d at 746 n.9. 6 This is not to discourage small businesses from raising Carter's argument, but the difficulty for an American company of litigating in Oregon is not the same as that of an individual litigating in -11- Bremen factor, we find that instead of being similarly situated to the plaintiff in Karlis, the enforcement of the clause is not unreasonable or unjust to Carter's. Finally, Carter's resorts to an unreported settlement agreement reached in FTC v. Leasecomm Corp., et al., No. 03-11034, ECF No. 2 (D. Mass. May 29, 2003) (stipulated final judgment and order). In that case, the Federal Trade Commission and the Massachusetts Attorney General brought suit against Leasecomm, which used certain forum selection clauses in its agreements with customers. As part of the settlement agreement, Leasecom agreed to cease attempts to enforce those forum selection provisions. This settlement agreement is, of course, neither a statute nor a judicial decision. Thus, even to the extent that it articulates Massachusetts public policy, Carter's does not explain why it does so in a form that is cognizable under Bremen. Carter's thus fails to persuade this court that enforcement of the forum selection clause would make it practically impossible for it to litigate in Oregon or contravene Massachusetts public policy.