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OKCDT Enterprise LLC v. CR Crawford Construction LLC

United States District Court, W.D. Oklahoma

March 22, 2019

OKCDT ENTERPRISE, LLC, and ANISH HOTELS GROUP, LLC, Plaintiffs,
v.
CR CRAWFORD CONSTRUCTION, LLC, CODY CRAWFORD, JASON KEATHLEY, and SCOTT STOKENBURY, Defendants.

          ORDER

          CHARLES B. GOODWIN UNITED STATES DISTRICT JUDGE.

         Now before the Court is Defendants' Motion to Dismiss (Doc. No. 4), filed on November 27, 2018. Plaintiffs have responded in opposition (Doc. No. 13), and Defendants have replied (Doc. No. 16). Upon consideration of the parties' submissions, the Court orders that the action be transferred to the United States District Court for the Western District of Arkansas.

         BACKGROUND

         In this lawsuit, it is alleged that in October 2017 Plaintiff Anish Hotels Group (“Anish Hotels”), an Oklahoma limited liability company, entered into a construction contract with Defendant CR Crawford Construction (“CR Crawford”), a foreign limited liability company, related to the construction of a Fairfield Inn Hotel in downtown Oklahoma City. See Pet. (Doc. No. 9-2) at 1-2. The real property designated as the site of construction is owned by Plaintiff OKCDT Enterprise (“OKCDT”). Id. at 1. OKCDT and Anish Hotels are affiliates and share the same sole member and manager, Aniketan Patel. Defs.' Mot. at 5; Doc. Nos. 6, 7. To finance the hotel's construction, OKCDT obtained a loan from Security National Bank of Enid, N.A., which was secured by a mortgage covering the real property. Pet. at 2.

         In August 2018, a dispute arose between CR Crawford and Anish Hotels regarding additional payments CR Crawford claimed were due under the contract. Alleging material breach, CR Crawford suspended its construction work on the hotel. Id. at 3. On September 18, 2018, CR Crawford filed a Material and Mechanic's Lien Statement against the hotel property in the amount of $1, 310, 243.10. Id. Defendants allege that on that same date, CR Crawford filed suit against Anish Hotels and other defendants in Washington County Circuit Court in Fayetteville, Arkansas, for breach of contract.[1] See Defs.' Mot. at 3; Defs.' Mot. Ex. 2 (Doc. No. 4-2) at 1. CR Crawford has since added OKCDT as a defendant in that action. Pl.'s Resp. at 3.

         Plaintiffs Anish Hotels and OKCDT filed the instant action on October 31, 2018, in the Oklahoma County District Court against Defendants CR Crawford, Cody Crawford, Jason Keathley, and Scott Stokenbury. See Pet. at 1. In this action, Plaintiffs seek a declaratory judgment that the amount CR Crawford claimed in the Material and Mechanic's Lien Statement was substantially incorrect, cancelation of the lien pursuant to title 42, section 177 of the Oklahoma Statutes, and an order directing CR Crawford to amend its lien statement to reflect only undisputed charges due under the contract. Plaintiffs additionally seek actual and special damages allegedly incurred due to CR Crawford's actions, including damages for slander of title and intentional interference with contractual relations. See Pet. at 1, 7.

         Defendants removed the case on November 19, 2018, asserting that this Court has diversity jurisdiction pursuant to 28 U.S.C. § 1332. See Notice of Removal (Doc. No. 1) at 1; Am. Notice of Removal (Doc. No. 9) at 1. Defendants moved for dismissal of the action pursuant to Rule 12(b)(3) of the Federal Rules of Civil Procedure and the doctrine of forum non conveniens.[2]

         DISCUSSION

         A. Motion for Dismissal under Rule 12(b)(3) of the Federal Rules of Civil Procedure

         Defendants contend that venue is improper due to a valid and enforceable forum selection clause (referred to herein as the “Forum Selection Clause”) contained in the construction contract executed by Anish Hotels and CR Crawford. See Defs.' Mot. at 4-11; see also Pet. at 15-29 (Agreement). The Forum Selection Clause provides, in its entirety:

This agreement shall be construed in accordance with the laws of the State of Arkansas. The exclusive venue for the litigation of any disputes arising hereunder or related to shall be either Washington County Circuit Court or United States District Court, Western District of Arkansas, Fayetteville Division. By executing this Agreement[, ] [Anish Hotels] hereby voluntarily, knowingly and intentionally submits itself to the personal jurisdiction of the courts referenced herein for the purpose of litigating any and all disputes with [CR Crawford] related to the Agreement.

Pet. at 26; see also Id. at 15; Defs.' Mot. Ex. 1 (Doc. No. 4-1) at 12. Based upon this provision, Defendants seek dismissal under Rule 12(b)(3) of the Federal Rules of Civil Procedure and the doctrine of forum non conveniens. See Defs.' Mot. at 2.

         The Court evaluates Defendants' request to enforce the Forum Selection Clause under the teachings of Atlantic Marine Construction Co., Inc. v. United States District Court for the Western District of Texas, 571 U.S. 49 (2013). In Atlantic Marine, the Supreme Court held that because venue in a federal district court is determined by the applicable statutory factors (typically those set forth in 28 U.S.C. § 1391(b)), a forum selection clause restricting suit to another jurisdiction “does not render venue in a court ‘wrong' or ‘improper' within the meaning of [28 U.S.C.] § 1406(a) or Rule 12(b)(3).” Id. at 59. Thus, a proper “mechanism for enforcement of forum-selection clauses that point to a particular federal district” is a motion to transfer under 28 U.S.C. § 1404(a), and the “appropriate way to enforce a forum-selection clause pointing to a state or foreign forum is through the doctrine of forum non conveniens.” Id. at 59, 60; see also Niemi v. Lasshofer, 770 F.3d 1331, 1351 (10th Cir. 2014).

         Plaintiff's allegations are plainly sufficient to satisfy the requirements set forth in 28 U.S.C. § 1391(b) to locate venue in the Western District of Oklahoma. See Pet. at 2 (“This action involves real property located in Oklahoma County, Oklahoma. . . . [T]he acts and omissions complained of . . . occurred in Oklahoma County, Oklahoma.”); 28 U.S.C. § 1391(b)(2). Accordingly, dismissal pursuant to Federal Rule of Civil Procedure 12(b)(3) or 28 U.S.C. § 1406(a) due to improper venue is not supported by reference to the cited Forum Selection Clause. See Fed. R. Civ. P. 12(b)(3); Atl. Marine, 571 U.S. at 55-56, 59. The Court denies Defendants' request for dismissal pursuant to Rule 12(b)(3) of the Federal Rules of Civil Procedure.

         B. Transfer under 28 ...


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