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McCracken v. Monosol RX

November 3, 2010


On appeal from Superior Court of New Jersey, Law Division, Morris County, Docket No. L-1533-09.

Per curiam.


Argued September 15, 2010

Before Judges Fuentes, Gilroy and Ashrafi.

In this appeal we are required to determine the enforceability of a forum selection clause in a contract of employment entered into by plaintiff John R. McCracken when he agreed to serve as Senior Vice President for Business Development and Licensing for defendant Monosol RX, LLC, a Delaware corporation. Plaintiff is a New Jersey resident; the employment contract designates Tarrant County, Texas as the venue for "any action brought concerning or arising from" the employment agreement.

The issue arises in the context of a complaint filed by plaintiff in the Law Division in Morris County challenging the grounds for his termination. In lieu of filing a responsive pleading, defendant filed a motion to dismiss the complaint pursuant to the venue selection clause in the agreement. After considering the arguments of counsel, which included a certification from plaintiff attesting to the alleged "inconvenience" he would endure if compelled to prosecute his case in Texas, the trial court granted defendant's motion and dismissed plaintiff's complaint without prejudice, subject to being re-filed in Texas.

We now affirm substantially for the reasons expressed by Judge Wright. Although this case was dismissed before defendant filed a responsive pleading, we are satisfied that the matter was ripe for disposition as a matter of law because the trial court's ruling was not predicated upon the legal viability of plaintiff's underlying claims.


Defendant is a Delaware corporation with its corporate headquarters located in Warren, New Jersey; it also has manufacturing, research, and development facilities in Indiana, and a laboratory in Tennessee. Defendant's principal owner and two members of its board of directors are the only individuals connected to this company who reside in Texas.

Plaintiff, a New Jersey resident, was hired by defendant as its Senior Vice President of Business Development and Licensing on May 15, 2008, to work in its New Jersey facility. In the course of the application process, plaintiff's personal contacts with defendant's representatives occurred only in New Jersey. He did, however, conduct two telephone interviews with two board members who reside outside of this State, one in Texas and one in New York.

As a condition of employment, plaintiff entered into an Executive Employment Agreement (the agreement) on April 28, 2008, that comprehensively described the terms and conditions of his employment. Although for our purposes it is not necessary to describe in detail all of the provisions included therein, we note that the agreement provided for a two-year term of employment, established plaintiff's annual compensation at $250,000 with a forty percent annual bonus if he met certain performance targets, and included a Termination for Cause provision that sets out eleven categories or grounds for terminating plaintiff's employment.

Concerning the adjudication of disputes arising from plaintiff's employment, the agreement included a venue jurisdiction clause providing that any litigation concerning the agreement was to be filed in Tarrant County, Texas. Specifically, Section 12 of the agreement states:

Venue: Jurisdiction. Any suit concerning this Agreement shall be filed solely in the courts of Tarrant County, Texas. In any action brought concerning or arising from this Agreement, [plaintiff] hereby agrees that he shall be subject to the jurisdiction of the state and federal courts of Texas.

On February 4, 2009, plaintiff received a "Cause Notice Period" letter describing defendant's concerns about plaintiff's unsatisfactory job performance. Pursuant to Section 5(a) of the agreement, this notice is intended to apprise plaintiff of the specific problem, or "cause," defendant had with plaintiff's performance and should include "a description of the evidence upon which the Company has relied to support such [a] finding." Plaintiff has thirty days from the receipt of this notice "to cure the action or inaction ...

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