UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY
March 30, 2010
MARIANNE P. D'ELIA AND FRANCIS J. D'ELIA, PLAINTIFFS,
GRAND CARIBBEAN COMPANY, LTD., INDIVIDUALLY AND D/B/A THE ROYAL CARIBBEAN, THE ROYAL RESORTS GROUP, ROMBEC, S.A. DE C.V., OPERADORA REAL CARIBE, S.A. DE C.V., INTERVAL SERVICING COMPANY, LLC, JOHN DOE(S) I-X (FICTITIOUS NAMES), ABC, INC. I-X (FICTITIOUS NAMES), XYZ COMPANIES I-X (FICTITIOUS NAMES), AND JOHN FOES I-X (FICTITIOUS NAMES), DEFENDANTS.
The opinion of the court was delivered by: Hillman, District Judge
Plaintiffs, Marianne P. D'Elia and Francis J. D'Elia, are a married couple who own a timeshare interest in a resort in Cancun, Mexico. While visiting the resort in Cancun, Marianne slipped on the floor and suffered severe injuries. As a result, plaintiffs filed suit in this Court, alleging four counts against several defendants involved in the ownership and operation of, and ancillary matters associated with, the resort where Marianne was injured. Among those defendants are Grand Caribbean Company, Ltd. ("Grand Caribbean"), also known as The Royal Caribbean, The Royal Resorts Group, Rombec, S.A. de C.V. ("Rombec"), Operadora Real Caribe, S.A. de C.V. ("Real Caribe"), and Interval Servicing Company, LLC ("Interval Servicing").*fn1
In response to plaintiffs' action, Interval Servicing moved to dismiss the complaint, arguing that a forum selection clause in plaintiffs' agreement with Grand Caribbean designates Mexico as the proper venue for this case. Alternatively, Interval Servicing submits that the doctrine of forum non conveniens also warrants dismissal of this case. Plaintiffs oppose Interval Servicing's motion.
For the reasons expressed below, Interval Servicing's Motion to Dismiss Plaintiffs' Complaint is denied.
This Court exercises subject matter jurisdiction over the underlying claim pursuant to 28 U.S.C. § 1332. There is complete diversity between plaintiffs and defendants in the underlying action. Plaintiffs, Marilyn and Francis D'Elia, are citizens of the State of New Jersey. Defendant, Grand Caribbean, is incorporated in the Cayman Islands with its principal place of business in Cancun, Quintana Roo, Mexico. Defendants, The Royal Resorts Group, Rombec, and Real Caribe, are all incorporated in Mexico with their principal places of business in Cancun, Quintana Roo, Mexico. Defendant, Interval Servicing, is a limited liability company organized in the State of Florida with its principal place of business in Fort Lauderdale, Florida. Interval Servicing's sole member, David F. Wright, is a citizen of the State of Arizona. Plaintiff alleges that the amount in controversy exceeds $75,000.00.
Beginning in 1990, plaintiffs were timeshare owners at The Royal Caribbean resort ("resort") and, thus, traveled to Cancun, Mexico on multiple occasions.*fn2 In early April 2007, plaintiffs traveled to Cancun to spend several days at the resort. Upon arrival plaintiffs signed a registration card. Featured in the middle of the card was a provision translated in both English and Spanish. Germane to the present motion, the provision read, in part:
I, the undersigned, with my signature below, hereby accept the following: . . . 3) I understand that the laws of the United States of Mexico, to the exclusion of the laws of any other jurisdiction whatsoever, shall apply to and shall govern, and the courts and authorities of the United States of Mexico shall have exclusive jurisdiction over any claim arising from any accident, injury or illness occurring during my stay at the Resort, or as a consequence thereof . . . .*fn3 Each plaintiff signed the registration card.
On or about April 10, 2007, while proceeding along a walkway on the sixth floor of the resort, leading to an elevator near a villa, Marianne D'Elia lost her footing and fell to the ground. She sustained severe injuries, including a tear in her left rotator cuff.
As a result of the accident, plaintiffs filed suit in this Court against several defendants, including Grand Caribbean, The Royal Resorts Group, Rombec, and Real Caribe --- all Mexican entities, say plaintiffs, who own, operate, manage, and or market the resort where Marianne was injured. Plaintiffs also named as a defendant Interval Servicing who, according to plaintiffs, also managed the resort and handled the management and operation of certain business and administrative duties for the other defendants, including collecting fees and arranging travel accommodations. As part of their complaint, plaintiffs allege that all of the defendants acted negligently in caring for and protecting plaintiffs during their time at the resort, thereby creating the dangerous conditions that caused Marianne to slip and fall on the premises. In light of defendants' alleged liability, plaintiffs seek recovery for negligence and loss of consortium, as well as punitive damages. Plaintiffs state that defendants are liable individually, jointly, and severally.
On or around August 18, 2009, Interval Servicing moved to dismiss plaintiffs' complaint on the grounds of the forum selection clause featured on the registration card and, alternatively, the doctrine of forum non conveniens. Plaintiffs oppose Interval Servicing's motion.
A. Standard for Motion to Dismiss
When considering a motion to dismiss a complaint for failure to state a claim upon which relief can be granted pursuant to Fed. R. Civ. P. 12(b)(6),*fn4 a court must accept all well-pleaded allegations in the complaint as true and view them in the light most favorable to the plaintiff. Evancho v. Fisher, 423 F.3d 347, 350 (3d Cir. 2005). It is well settled that a pleading is sufficient if it contains "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). Under the liberal federal pleading rules, it is not necessary to plead evidence, and it is not necessary to plead all the facts that serve as a basis for the claim. Bogosian v. Gulf Oil Corp., 561 F.2d 434, 446 (3d Cir. 1977). However, "[a]lthough the Federal Rules of Civil Procedure do not require a claimant to set forth an intricately detailed description of the asserted basis for relief, they do require that the pleadings give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests." Baldwin County Welcome Ctr. v. Brown, 466 U.S. 147, 149 n.3 (1984) (citation and internal quotation marks omitted).
A district court, in weighing a motion to dismiss, asks "'not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claim.'" Bell Atl. Corp. v. Twombly, 550 U.S. 544, 563 n.8 (2007) (quoting Scheuer v. Rhoades, 416 U.S. 232, 236 (1974)); see Ashcroft v. Iqbal, 129 S.Ct. 1937, 1953 (2009) ("Our decision in Twombly expounded the pleading standard for 'all civil actions' . . . ." (citation omitted)). Under the Twombly/Iqbal standard, the Third Circuit has instructed a two-part analysis. First, a claim's factual and legal elements should be separated; a "district court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions." Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009) (citing Iqbal, 129 S.Ct. at 1950).
Second, a district court "must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a 'plausible claim for relief.'" Id. at 211 (quoting Iqbal, 129 S.Ct. at 1950). "[A] complaint must do more than allege the plaintiff's entitlement to relief." Id.; see Phillips v. County of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008)
("The Supreme Court's Twombly formulation of the pleading standard can be summed up thus: 'stating . . . a claim requires a complaint with enough factual matter (taken as true) to suggest' the required element. This 'does not impose a probability requirement at the pleading stage,' but instead 'simply calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of' the necessary element." (quoting Twombly, 550 U.S. at 556)). The defendant bears the burden of showing that no claim has been presented. Hedges v. U.S., 404 F.3d 744, 750 (3d Cir. 2005).
B. Forum Selection Clause
Interval Servicing believes that the forum selection clause featured on the registration card signed by each plaintiff requires that this case be brought in Mexico and, thus, that this Court is an improper venue. Plaintiffs oppose Interval Servicing's assertion. However, as a threshold matter, plaintiffs challenge Interval Servicing's standing to invoke the forum selection clause.
Plaintiffs argue that Interval Servicing does not have standing to enforce the forum selection clause featured on the registration card. According to plaintiffs, Interval Servicing is a non-signatory to the contract and is not a third-party beneficiary as intended by the parties. Therefore, plaintiffs conclude that Interval Servicing cannot rely on the clause. On the contrary, Interval Servicing contends that its standing to enforce the clause is predicated on the alleged agency relationship between itself and other defendants who are direct parties to the contract. Moreover, Interval Servicing opines that it is a third-party beneficiary to the contract and that the Court's decision to not enforce the clause would prejudice Interval Servicing because all potential witnesses and evidence are located in Mexico and are beyond the jurisdiction of this Court.
In the Third Circuit, a non-signatory party may enforce a forum selection clause in a contract if that party is a third-party beneficiary of the contract or is closely related to the contractual relationship or dispute such that it is foreseeable that the party will be bound.*fn5 See Coastal Steel, Corp. v. Tilghman Wheelabrator, 709 F.2d 190, 203 (3d Cir. 1983); Four River Exploration, LLC v. Bird Res., Inc., 2010 U.S. Dist. LEXIS 3227, at *7 (D.N.J. Jan. 15, 2010); Hadley v. Shaffer, 2003 U.S. Dist. LEXIS 14106, at *10 (D. Del. Aug. 12, 2003); Jordan v. SEI Corp., 1996 U.S. Dist. LEXIS 7627, at *20 (E.D. Pa. Jun. 4, 1996); cf. Burtch v. Sec. Pac. Bank Oregon, 247 B.R. 395, 398 n.4 (E.D. Pa. 2000) ("There is an argument to be made that non-parties to a contract seeking to enforce a forum selection clause should be required to make an even greater showing than parties to a contract seeking to enforce such a clause against non-parties.").
In this case, the parties dispute whether Interval Servicing was a third-party beneficiary entitled to enforce the forum selection clause at issue. "To qualify as a third-party beneficiary, it must be shown that the contract was 'made for the benefit of that third party within the intent and contemplation of the contracting parties.'" Hadley, 2003 U.S. Dist. LEXIS 14106, at **13-14 (quoting Grand St. Artists v. Gen'l Electric. Co., 19 F. Supp. 2d 242, 253 (D.N.J. 1998)). A forum selection clause is not enforceable by merely an incidental third-party beneficiary. See E.I. Dupont de Nemours & Co. v. Rhone Poulenc Fiber & Resin Intermediates, S.A.S., 269 F.3d 187, 196 (3d Cir. 2001) (stating that "if it was not the promisee's intention to confer direct benefits upon a third party, but rather such third party happens to benefit from the performance of the promise either coincidentally or indirectly, then the third party will have no enforceable rights under the contract" because the third party is nothing "more than an incidental third party beneficiary"); Prinzivalli v. Aruba Phoenix Beach Resort, 2008 U.S. Dist. LEXIS 22202, at *4 (D.N.J. Mar. 20, 2008) ("Without this intention to confer a benefit, the third party just so happens to benefit and he or she will have no contractual rights under the agreement. An incidental beneficiary is not bound by a forum selection clause." (citing Reider Communities, Inc. v. N. Brunswick Twp., 546 A.2d 563, 567 (N.J. App. Div. 1988))). Accordingly, a court must examine the contract's terms and the surrounding circumstances to discern whether the contracting parties intended to confer benefits on the non-signatory party. Prinzivalli, 2008 U.S. Dist. LEXIS 22202, at *4.
Here, there is no persuasive argument or evidence to suggest that Interval Servicing was an intended third-party beneficiary of the forum selection clause signed by plaintiffs upon their arrival at the resort. The parties agree that Interval Servicing performs certain administrative and business services on behalf of the other defendants. While plaintiffs also allege that Interval Servicing may manage or maintain the resort's premises, Interval Servicing readily denies that allegation.*fn6 Accordingly, these averments alone, uncorroborated and disputed in part, do not, as a matter of law, render Interval Servicing a third-party beneficiary who is bound by and may enforce the forum selection clause at issue.
The forum selection clause, signed by plaintiffs upon their arrival at the resort, is broad in scope, declaring Mexico the appropriate forum for "any claim" arising during the guests' stay. Although, on its face, the clause may seem to benefit multiple non-signatory parties affiliated with the resort, nothing in the clause, plaintiffs' complaint, or the parties' briefs clearly and unequivocally illustrates the intent of the signatories to extend the benefits of the forum selection clause to Interval Servicing. Interval Servicing's inability to demonstrate its status as a third-party beneficiary is evinced further by its own representation that it was not involved in the management or maintenance of the resort's premises, and, thus, was seemingly beyond the parties' contemplation and intention when agreeing to the contract. Cf. E.I. Dupont de Nemours & Co., 269 F.3d at 199 (refusing to bind non-signatory parent corporation to arbitration agreement of its subsidiary).
Even if it is not a third-party beneficiary for purposes of the forum selection clause, Interval Servicing still contends that it may enforce the clause on account of its alleged close relationship to the contracting parties and the dispute in this case. In the Third Circuit, those circumstances in which a nonsignatory party may enforce the forum selection clause are limited, often reserved to matters of agency or employment or to principles of common law contracts.*fn7 See Hay Acquisition Co. v. Schneider, 2005 U.S. Dist. LEXIS 24490, at *26 (E.D. Pa. Apr. 27, 2005) (analogizing forum selection clause analysis with that of arbitration clause and explaining that "the Third Circuit explicitly stated its willingness to hold 'a variety of nonsignatories . . . bound by such agreements under ordinary common law contract and agency principles"); see also E.I. Dupont de Nemours & Co., 269 F.3d at 194 (explaining that "a nonsignatory cannot be bound to arbitrate unless it is bound under traditional principles of contract and agency law to be akin to a signatory of the underlying agreement" (citation and internal quotation marks omitted)).
As highlighted by Interval Servicing, plaintiffs' complaint alleges that Interval Servicing "is an agent, employee and/or partner" of the other defendants named in the suit. That generalized averment is entirely conclusory in nature and, in and of itself, does not resolve the question of Interval Servicing's relationship to the other defendants or the registration card in this case. Interval Servicing, nevertheless, argues that this Court may accept the complaint's allegations as true for purposes of enforcing the forum selection clause and, based on those allegations, may determine that Interval Servicing is an agent, employee, or affiliate of the other defendants who has standing to invoke the clause. However, just as Interval Servicing believes that plaintiffs cannot use their theory of agency both as a shield and a sword, nor should Interval Servicing.
Interval Servicing expressly denies that it shares an agency relationship with any of the other defendants in this case.*fn8
Further, no evidence or documentation, including the registration card, illuminates the relationship between Interval Servicing and the other defendants. While obligated to accept plaintiffs' allegations as true, the Court cannot conclude, in an independent matter relating to contract construction and common law jurisprudence, that Interval Servicing is actually an agent, employee, or partner of the other defendants merely because plaintiffs say so. See E.I. Dupont de Nemours & Co., 269 F.3d at 197 (refusing to find that plaintiff, who identified itself in its complaint as a third-party beneficiary of an agreement, was in fact such a beneficiary simply on the basis of its averment because "the question of its status is ultimately for us to decide under applicable law").*fn9 Again, the Court's reluctance is bolstered by Interval Servicing's own denials of such a relationship.*fn10
At a later time, if further evidence reveals that Interval Servicing was a third-party beneficiary of the forum selection clause or shares a relationship with the other defendants entitling it to invoke the forum selection clause, then Interval Servicing may file another motion to dismiss.*fn11
Accordingly, for the reasons stated above, Interval Servicing's Motion to Dismiss on account of the forum selection clause is denied, without prejudice.*fn12
C. Forum Non Conveniens
Alternatively, Interval Servicing contends that the doctrine of forum non conveniens counsels in favor of dismissing plaintiffs' complaint. According to Interval Servicing, Mexico provides a more convenient forum for litigation, especially with the majority of defendants being Mexican entities. Further, as illustrated by evaluating a number of relevant considerations, asserts Interval Servicing, a federal court in New Jersey is an unreasonable and unfair forum because the site of the accident, any witnesses to or employees responsible for the accident, the other named defendants, and Marianne's initial medical treatment all occurred or are all located in Mexico. Therefore, Interval Servicing disputes plaintiffs' attempt to pursue their claims here.
On the other hand, plaintiffs opine that Interval Servicing has not satisfied its burden to justify dismissal pursuant to forum non conveniens. In particular, plaintiffs assert that Mexico may not provide an adequate alternative forum, that the State of New Jersey has an interest in providing a forum for its citizens to seek redress, and that difficulties in transporting witnesses will arise no matter where the litigation is held.
Regarding the doctrine of forum non conveniens, the Supreme Court of the United States has held:
A federal court has discretion to dismiss a case on the ground of forum non conveniens "when an alternative forum has jurisdiction to hear [the] case, and . . . trial in the chosen forum would establish . . . oppressiveness and vexation to a defendant . . . out of all proportion to plaintiff's convenience, or . . . the chosen forum [is] inappropriate because of considerations affecting the court's own administrative and legal problems."
Sinochem Int'l Co. v. Malay. Int'l Shipping Corp., 549 U.S. 422, 429 (2007) (quoting American Dredging Co. v. Miller, 510 U.S. 443, 447-48 (1994)). Generally, the defendant invoking the doctrine of forum non conveniens carries the burden to justify dismissal of the plaintiff's suit in the chosen forum. Bhatnagar by Bhatnagar v. Surrendra Overseas, 52 F.3d 1220, 1226 (3d Cir. 1995).
At the outset of the forum non conveniens analysis, the defendant must demonstrate that another forum is adequate and available to adjudicate the parties' case. Lacey v. Cessna Aircraft Co., 932 F.2d 170, 180 (3d Cir. 1991). If the defendant carries its initial burden, the court then must determine whether private and public interests decidedly weigh in favor of dismissal and trial in the foreign forum.*fn13 Id.
In this case, Interval Servicing fails to satisfy the threshold issue in the forum non conveniens analysis ---demonstrating that Mexico provides an adequate alternative forum for plaintiffs to pursue their suit. To determine the adequacy of a proposed alternative, foreign forum, the defendant must show its "amenability to process in the foreign jurisdiction and the existence of a satisfactory remedy there." Miller v. Boston Sci. Corp., 380 F. Supp. 2d 443, 447-48 (D.N.J. 2005). Although the inquiry into the adequacy of the alternative forum is limited, Interval Servicing sets forth nothing more than conclusory statements assuring the Court that plaintiffs could pursue their action in Mexico against the other defendants. However, in so doing, Interval Servicing does not explicitly concede that it is subject to the jurisdiction of Mexican courts or that it would waive any jurisdictional or other legal obstructions that may impede plaintiffs' case there. See Micro Agri-Equip. v. Sperry-New Holland Div. of Sperry, Inc., 1985 U.S. Dist. LEXIS 13038, at *4 (E.D. Pa. Dec. 9, 1985) (explaining that adequate alternative forum exists, for purposes of dismissal pursuant to forum non conveniens, because defendant agreed to waive all objections, including statute of limitations, and to participate in discovery in new forum).
Further, Interval Servicing proffers no authority to illustrate the existence of a satisfactory remedy for plaintiffs in Mexico or that their suit would survive Mexico's statute of limitations. See Bhatnagar by Bhatnagar, 52 F.3d at 1225 (stating that "a district court cannot dismiss on forum non conveniens grounds if that decision would render a plaintiff unable to pursue his or her action elsewhere"); First Colonial Ins. Co. v. Custom Flooring, Inc., 2007 U.S. Dist. LEXIS 40457, at **13-14 (D.N.J. Jun. 4, 2007) (noting that a statute of limitations defense in a proposed alternative forum may deem the forum "inadequate" for purposes of forum non conveniens); see also MSC Mediterranean Shipping Co. v. Koninklijke Boskalis Westminster NV, 569 F.3d 189, 202 (4th Cir. 2009) (stating "that if the statute of limitations has expired in the alternative forum, the forum is not available, and the motion to dismiss based on forum non conveniens would not be appropriate").
Because Interval Servicing has failed to satisfy this threshold inquiry, the Court need not delve any further into its forum non conveniens analysis.*fn14 See Steward Int'l Enhanced Index Fund v. Carr, 2010 U.S. Dist. LEXIS 5047, at *8 (D.N.J. Jan. 22, 2010) ("To secure a dismissal on forum non conveniens grounds, Defendants must meet the threshold requirement by demonstrating that there is an adequate alternative forum. As the moving party, Defendants bear the burden of proof on this matter."); Miller, 380 F. Supp. 2d at 448 (stating that whether an adequate alternative forum exists "must be resolved before reaching other stages of the forum non conveniens analysis"); see also Yavuz v. 61 MM, Ltd., 576 F.3d 1166, 1172 (10th Cir. 2009) (stating that if defendant fails to show an adequate alternative forum exists, "the forum non conveniens doctrine is inapplicable" (citation and internal quotation marks omitted)).
For the foregoing reasons, the Court concludes that Interval Servicing has not carried its burden to justify dismissal pursuant to the doctrine of forum non conveniens. Nevertheless, the denial of Interval Servicing's motion is without prejudice, and Interval Servicing may resubmit a motion to dismiss on those grounds at a later time when it may make a more sufficient showing.*fn15
For the foregoing reasons, Interval Servicing's Motion to Dismiss is denied, without prejudice. An Order consistent with this Opinion shall be entered.
NOEL L. HILLMAN, U.S.D.J.