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Wors v. Sling Medical

May 14, 2010

DAVID WORS, PLAINTIFF,
v.
SLING MEDICAL, INC., AND DAVID DAVIS, DEFENDANTS.



The opinion of the court was delivered by: Reagan, District Judge

MEMORANDUM AND ORDER

I. Introduction

On February 8, 2010, Plaintiff, David Wors, filed a complaint in this Court against Defendants, Sling Medical, Inc., and David Davis, under the Illinois Sales Representative Act, 820 ILCS 120, et seq. ("ISRA"). Plaintiff invokes this Court's jurisdiction under the federal diversity statute, 28 U.S.C. § 1332. The parties are diverse in that Plaintiff is a citizen of Illinois; Sling Medical, a citizen of Kansas and Missouri; and Davis, a citizen of Kansas. The amount in controversy alleged satisfies the jurisdictional amount - exceeding $75,000.00, exclusive of interest and costs.

According to the complaint, on October 1, 2008, Plaintiff and Defendants entered into an agreement whereby Sling agreed to pay Plaintiff commissions for the period October 1, 2008, to September 30, 2009, for his work as a sales representative. Davis, the President of Sling, signed the contracts at issue. Plaintiff alleges that he made three sales of patient monitoring equipment during this period for which he was underpaid, given the terms of the applicable commission agreement.

According to Plaintiff, Defendants' failure to pay the amounts described in the complaint violates the ISRA.

Now before the Court is Defendant Sling's motion to dismiss for improper venue pursuant to FEDERAL RULE OF CIVIL PROCEDURE 12(b)(3) (Doc. 13).

II. Analysis

Under the Non-Competition and Confidentiality Agreement ("Agreement") entered into at the beginning of the parties' relationship, Plaintiff expressly agreed to a forum selection clause restricting any litigation arising out of the commission compensation arrangement to the exclusive forum of the state courts of Johnson County, Kansas.

4. Governing Law and Exclusive Forum

This Agreement shall be interpreted and enforced in accordance with the laws of the State of Kansas. The parties agree that any litigation that may be commenced by either of the parties with respect to or related to the Sales Representative's affiliation with the Company and/or with respect to this Agreement shall take place in the state courts of Kansas, in Johnson County (or, should Johnson County not be the vicinage of any Kansas state courts, in such a Kansas county most proximate to Johnson County), which the parties agree shall be the exclusive forum for any such litigation, and to whose jurisdiction the Sales Representative agrees to submit in such an event. (Doc. 14, Exhibit, Agreement ¶ 4).

It is under this forum selection clause that Defendant seeks to have the case dismissed for improper venue pursuant to FEDERAL RULE OF CIVIL PROCEDURE 12(b)(3), which authorizes the district court to dismiss or transfer a case if venue is improper or inconvenient in the chosen forum. Defendant argues that venue is improper in the Southern District of Illinois, and the case should be dismissed because this Court cannot transfer the case to a state court, which is the only appropriate forum.

In response, Plaintiff submits that, because this Court's jurisdiction is based on diversity of citizenship, Illinois substantive law supplies the rule of decision, including Illinois law concerning "choice of law." According to Plaintiff, Illinois appellate courts have voided forum selection clauses to the extent the sales representatives were pursuing claims under the ISRA, finding such clauses violate the fundamental public policy of Illinois. Plaintiff submits that the forum selection clause Defendant advances in its motion is void and, if this case were being tried in state court, would have no effect.

It is well settled that contractual forum selection clauses have a prima facie presumption of validity. M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1977). Such a clause is enforced unless the provision was procured by fraud or overreaching or enforcement would be unreasonable. Paper Express Ltd. v. Pfankuch Maschinen GmbH, 972 F.2d 753, 757 (7th Cir. 1992). In essence, the clause will be enforced unless its enforcement would be a "serious inconvenience." Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 592 (1991). The Seventh Circuit has endorsed this approach, announcing that "the law is clear: where venue is specified with mandatory or obligatory language, the clause will be enforced; where jurisdiction is specified, the clause will generally not be enforced unless there is some further language indicating the parties' intent to make venue exclusive." Paper Express, 972 F.2d at 757.

Here, the contract's forum selection clause clearly provides that "any litigation that may be commenced by either of the parties with respect to or related to the Sales Representative's affiliation with the Company and/or with respect to this Agreement shall take place in the state courts of Kansas, in Johnson County." Therefore, under the law of the Seventh Circuit, this Court should enforce the clause unless the forum selection clause in ...


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