United States District Court, D. New Jersey
NATASHA FORD, individually and on behalf of her minor child C.F. Minor, Plaintiffs,
EF EXPLORE AMERICA, INC.; HOLIDAY HOSPITALITY FRANCHISING, INC.; HOLIDAY CLARK, LLC; U.S. SECURITY ASSOCIATES, INC., Defendants.
Ford brings this diversity action individually and on behalf
of her child, C.F. (together, "Ford"). The action
arises from an educational tour to the New York area that
took place in June 2017. Defendant EF Explore America, Inc.
("EF"), located in Massachusetts, is in the
business of organizing and sponsoring tours. Defendant
Holiday Hospitality Franchising, Inc., states that it is a
franchising entity. Holiday Clark, LLC operates a lodging
facility in Clark, New Jersey. (These two defendants are
collectively referred to as "Holiday.") Defendant
U.S. Security Associates, Inc. ("U.S. Security")
provided a guard. The guard's job was to ensure the
security of the children while they were staying at the
Holiday Inn in Clark, New Jersey. The complaint alleges that
the guard roused some of the boys in the middle of the night,
tried to show pornography to C.F., who was 13 years old at
the time, touched him sexually through his clothing, and
tried to get in the shower with him, 
matter comes before the court on the renewed motion (DE 53)
of defendant EF under 28 U.S.C. § 1404(a) to dismiss or
transfer venue to the U.S. District Court for the District of
Massachusetts, pursuant to a contractual forum-selection
clause. For the reasons stated herein, the motion to transfer
venue will be granted.
prior Opinion & Order ("Op.", DE 49) I found
that the forum-selection clause was valid and enforceable as
between EF and Ford. I also found, however, that the papers
had failed to discuss the effect of the presence of other
defendants who are not parties to the contract or its forum
selection clause. Under recent Third Circuit case law, a
different and potentially complex analysis is required in
that situation. See In re: Howmedica Osteonics Corp,
867 F.3d 390, 402 (3d Cir. 2017), cert, denied, 138
S.Ct. 1288 (2018). I therefore denied the motion without
prejudice to refiling within 21 days. In doing so, I ordered
all defendants to state their legal and factual
positions on the motion to transfer under the
refiled its motion (DE 53), this time with a discussion of
the Howmedica factors. The plaintiffs have filed a
response (DE 60), and EF has filed a Reply. (DE 61) I heard
oral argument in open court on July 31, 2019.
remaining defendants did not, as ordered, make separate
submissions stating their positions on the motion, impeding
the Court's analysis of the relevant factors. In response
to my questioning at oral argument, however, counsel for the
Holiday defendants and U.S. Security stated that they do not
oppose transfer. Both committed on behalf of their clients
that, if the case were transferred, they would submit to die
jurisdiction of the U.S. District Court for the District of
Massachusetts and would not contest personal jurisdiction or
on that concession and an analysis of the relevant factors, I
will grant the motion to transfer venue of the entire case to
the District of Massachusetts.
with my prior Opinion (DE 49) is assumed; this Opinion should
be read as a supplement to it. I have already found the
Massachusetts forum-selection clause in the contract between
Ford and EF to be valid and enforceable as between those two
parties. (Op. pp. 2-5) The remaining issue is
whether that clause should be overridden based on the
presence of other defendants who were not parties to that
contract. For the reasons stated herein, I answer that
question in the negative and grant the motion to transfer
venue to the District of Massachusetts.
issue is governed by the "four-step analysis"
dictated by Howmedica, supra. In my prior
Opinion I quoted the steps thus:
Step One: Forum-Selection Clauses. At the first
step, the court assumes that Atlantic Marine applies to
parties who agreed to forum-selection clauses and that,
"[i]n all but the most unusual cases," claims
concerning those parties should be litigated in the for a
designated by the clauses. Atl. Marine, 134 S.Ct. at
583. . . .
Step Two: Private and Public Interests Relevant to
Non-Contracting Parties. Second, the court performs an
independent analysis of private and public interests relevant
to non-contracting parties, just as when adjudicating a
§ 1404(a) transfer motion involving those parties in the
absence of any forum-selection clauses. . . . [C]ourts at
Step Two should consider the private and public interests
"of the parties who have not signed a forum-selection
agreement." ... If, at this juncture, the Step One and
Step Two analyses point to the same forum, then the court
should allow the case to proceed in that forum, whether by
transfer or by retaining jurisdiction over the entire case,
and the transfer inquiry ends there.
Step Three: Threshold Issues Related to Severance.
Third, if the Step One and Step Two analyses point different
ways, then the court considers severance. See Fed.
R. Civ. P. 21. In some cases, severance clearly will be
warranted to preserve federal diversity jurisdiction; to cure
personal jurisdiction, venue, or joinder defects; or to allow
for subsequent impleader under Federal Rule of Civil
Procedure 14. In such cases, the court should sever and
transfer claims as appropriate to remedy jurisdictional and
procedural defects. If only one severance and transfer
outcome satisfies the constraints identified at this step,
then the court adopts that outcome and the transfer inquiry
ends. But if more than one outcome satisfies the threshold
severance constraints, then the court continues to Step Four.
In other cases, severance is clearly disallowed, such as when
a party is indispensable under Federal Rule of Civil
Procedure 19(b). ... In these cases, the court cannot sever,
. . . and the case must continue with all parties present in
a forum where jurisdiction and venue are proper as to the
indispensable party, which could be either the originating
district court or the court to which transfer is sought. If
jurisdiction and venue are proper as to the indispensable
party in only one of those courts, then the transfer inquiry
ends there and the case must continue in that court. If,
however, jurisdiction and venue are proper as to the
indispensable partly in both the originating court and the
proposed transferee court, then, in deciding where the whole
case should proceed, the court proceeds to Step Four.
Likewise, in cases where severance is neither clearly
warranted nor clearly disallowed and is therefore committed
to the court's discretion (such as when there are no
indispensable parties or defects in jurisdiction, venue, or
joinder), the court goes on to select the appropriate for a
based on a combination of interests addressed at the next
Step Four: Efficiency and Non-Contracting Parties'
Private Interests. Fourth, a district court exercises
its discretion (which we will review for abuse of discretion)
in choosing the most appropriate course of action, . . . but
it measures its decision against two key sets of interests.
On the one hand, the court considers efficiency interests in
avoiding duplicative litigation, . . . taking into account
case management techniques that can reduce inefficiencies
accompanying severance, ... as well as any other public
interests that may weigh against enforcing a forum-selection
clause .... On the other hand, the court also considers the
non-contracting parties' private interests and any
prejudice that a particular transfer decision would cause
with respect to those interests.
In exercising its discretion to determine whether it should
retain the case in its entirety, transfer the case in its
entirety, or sever certain parties or claims in favor of
another forum, the court considers the nature of any
interests weighing against enforcement of any forum-selection
clause; the relative number of non-contracting parties to
contracting parties; and the non-contacting parties'
relative resources, keeping in mind any jurisdiction, venue,
or joinder defects that the court must resolve. Only if it
determines that the strong public interest in upholding the
contracting parties' settled expectations is
"overwhelmingly" outweighed by the countervailing
interests can the court, at this fourth step, decline to
enforce a valid forum-selection clause.
Howmedica, 867 F.3d at 403-05 (citing Atlantic
Marine Construction Co. v. U.S. District Court, 571 U.S.
49, 134 S.Ct 568 (2013)). Where, as here, the competing fora
are both within the federal court system, Atlantic
Marine prescribes a transfer of venue, rather than the
alternative remedy of dismissal. 571 U.S. at 60.
on the submissions, as supplemented by oral argument, I will
undertake an ...