ROSLYN O. SILVER, Senior District Judge.
This case involves a dispute between a former employee and the companies to which he applied to work as a flight instructor in Saudi Arabia in 2008. Since the case's inception, the complaint has been through several iterations.
On February 18, 2015, the Court resolved a motion to dismiss and allowed two counts to proceed: one for fraud and misrepresentation and one for false imprisonment. On March 11, 2015, Plaintiff filed a motion for partial summary judgment, arguing a forum selection clause contained in his employment documents was invalid and unenforceable. The Court denied the motion, concluding material facts remained in dispute. On April 8, 2015, the Court held an evidentiary hearing to ascertain those facts bearing on the validity and enforceability of the forum selection clause. Based on the evidence presented, the Court finds the forum selection clause is unenforceable.
In November 2008, Plaintiff Robin Petersen ("Plaintiff") applied to Defendant Boeing Company through a website for a job to train pilots in Saudi Arabia with
Noticing the error, Plaintiff testified he called Ms. Jones. As support, Plaintiff produced phone records showing two calls to Ms. Jones from Plaintiff's cell phone at 1:00 pm and 1:14 pm on November 20, 2008. Each call lasted two minutes. Plaintiff also stated that, on November 19, 2008, the date he received Ms. Jones's email, he was staying at his father's home and it was possible he called Ms. Jones on the 19th from his father's home. But, he could not recall and did not have phone records to verify his supposition.
Plaintiff testified that, during the calls to Ms. Jones, he explained the duplication and missing Employment Agreement and was told that if he wanted the job, he needed to sign and return the Offer Letter and Acknowledgment. Plaintiff also claimed Ms. Jones told him not to worry about the missing Employment Agreement because it would be presented to him for signature upon his arrival in Saudi Arabia. Ms. Jones did not recall receiving the phone calls from Plaintiff and testified that, if a missing document had been brought to her attention, she would have immediately sent it on to Plaintiff.
Documents attached to the email were the Offer Letter and Addendum A to Employment Agreement. The Offer Letter stated Plaintiff had until November 21, 2008 to respond "[i]n order to allow you sufficient time to make this important decision." Plaintiff's Exhibit 17. Addendum A contained a forum selection clause, which stated: "The Labor Courts of Saudi Arabia shall have sole jurisdiction over any disputes arising out of this agreement." Plaintiff's Exhibit 17. Although Plaintiff testified he printed and read all of the attached documents, he later admitted he had not read the Addendum "clearly" because, he claimed, Ms. Jones told him it was not important.
On November 20, 2008, Plaintiff faxed Ms. Jones a copy of the signed Offer Letter and Acknowledgement, which stated he had been provided with a copy of the Employment Agreement and Addendums. Defendants' Exhibit 102. On the fax cover sheet, Plaintiff stated he would complete any additional paperwork and requirements "by this afternoon." Defendants' Exhibit 102.
In January 2009, Plaintiff traveled to Riyadh, Saudi Arabia. There, he met with Boeing employee Shaun Ford, who presented him, for the first time, with a copy of the Employment Agreement. Plaintiff characterized Mr. Ford as tense and that he rushed Plaintiff to sign the Employment Agreement. The Employment Agreement contained a forum selection clause similar to the one contained in Addendum A. That clause stated Saudi law
Mr. Ford testified that he spent three to four hours with Plaintiff that included specifically discussing the documents with him. Plaintiff said only approximately one hour of the meeting was devoted to discussing the documents. Plaintiff testified, after he signed the Agreement, Mr. Ford seemed to relax. Plaintiff acknowledged it was too late for him to turn down his employment with Boeing at that point because he could not have survived without the anticipated compensation for his work.
Regarding access to the Saudi Labor Courts, Plaintiff's expert, Haider Hamoudi, an associate professor of law at the University of Pittsburgh School of Law, and Defendants' expert, Omar Al-Saab, a Saudi lawyer, both agreed that non-Saudis traveling to Saudi Arabia must do so under either a work or business visa or for purposes of religious pilgrimage. The experts also agreed Saudi courts do not ordinarily allow or have the capability of hearing testimony via telephone conference or video feed.
Defendants' expert testified that the Saudi Labor Courts have jurisdiction over employment contract disputes and, where ambiguous, conflicting interpretations are generally resolved in favor of employees. Significantly, when a dispute is not based on a term or representation memorialized in an employment contract, he stated, testimony is only occasionally considered. But it is common that the dispute is resolved based on the written evidence of the contract. Finally, and of greatest significance, he testified Saudi courts will only credit an individual's testimony if it is corroborated by two adult, male, Muslim witnesses.
The expert made clear a dispute involving a party claiming he had been forced to sign an employment contract would likely not be heard before the Saudi Labor Court, but rather would be transferred to the general, criminal court.
A party arguing the unenforceability of a forum selection clause bears a "heavy burden": Such a clause "[should be] enforce[d] ... unless [the party contesting it can] clearly show that enforcement would be unreasonable and unjust, or that the clause was invalid for such reasons as fraud or overreaching." M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15, 92 S.Ct. 1907, 32 L.Ed.2d 513 (1972).
In Atlantic Marine, decided approximately seven months after the Ninth Circuit's decision in this case, the Supreme Court upheld Bremen's presumption in favor
The first step in applying forum non conveniens is to determine whether the forum specified in the clause is adequate. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255, n. 22, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981).
Lower courts have taken various approaches when applying Bremen and Atlantic Marine. See Jes Solar Co. v. Matinee Energy, Inc., 2014 WL 2885476, at *2 (D.Ariz. June 25, 2014) (declining to consider private interests where forum selection clause deemed valid, and proceeding to forum non conveniens analysis under Atlantic Marine); Frango Grille USA, Inc. v. Pepe's Franchising, Ltd., 2014 WL 7892164, at *2-3 (C.D.Cal. July 21, 2014) (undertaking Bremen analysis to determine validity before turning to Atlantic Marine to analyze forum non conveniens); Mao v. Sanum Invs., Ltd., 2014 WL 5292982 at *3-4 (D.Nev. Oct. 15, 2014) (same); Russel v. De Los Suenos, 2014 WL 1028882, at *6 (S.D.Cal. Mar. 17, 2014)
In essence, in its order on Plaintiff's motion for summary judgment, the Court held, under Atlantic Marine, a motion to dismiss or transfer pursuant to a valid forum selection clause is evaluated according to the doctrine of forum non conveniens, excluding that doctrine's traditional consideration of private interest factors, but incorporating Bremen's concerns about access to justice in weighing the public interest factors. (See Doc. 177). This requires assessing the adequacy and availability of the proposed alternative forum, followed by balancing the public interest factors for and against granting dismissal for pursuit in the alternative forum.
The forum selection clause specifies the Saudi Labor Courts, specifically, shall have sole jurisdiction over claims arising out of the Employment Agreement. Therefore, the Court's analysis centers on the adequacy of the Saudi Labor Courts, specifically, as opposed to Saudi courts more generally.
An alternative forum is adequate if it is capable of "provid[ing] the plaintiff with a sufficient remedy for his wrong." Dole Food Co. v. Watts, 303 F.3d 1104, 1118 (9th Cir.2002). Dismissal is not appropriate where "the remedy provided by the alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all." Piper Aircraft, 454 U.S. at 254, n. 22, 102 S.Ct. 252. However, an alternative forum is not inadequate merely because the substantive law to be applied is less favorable than that of the present forum. Id. at 247, 102 S.Ct. 252. The forum need only provide "some potential avenue for redress." Ceramic Corp. of Am. v. Inka Mar. Corp. Inc., 1 F.3d 947, 949 (9th Cir.1993). In determining the adequacy of the alternative forum, the Court may consider whether the litigants would be barred from relief due to discrimination, corruption, or some other unfairness. See Carijano v. Occidental Petroleum Corp., 643 F.3d 1216, 1226 (9th Cir.2011).
An alternative forum is available "when defendants are amenable to service of process in the foreign forum and when the entire case and all parties can come within the jurisdiction of that forum." Gutierrez v. Advanced Med. Optics, Inc., 640 F.3d 1025, 1029 (9th Cir.2011) (citing Dole Food, 303 F.3d at 1118) (internal quotation marks omitted).
The Saudi Labor Courts are not an adequate forum for Plaintiff's claims. Both experts testified that the Saudi Labor Courts (and other Saudi courts) employ discriminatory evidentiary rules. A Saudi court will only credit testimony if corroborated by two male, Muslim witnesses. This discrimination has direct bearing on Plaintiff's case since his claims are largely based on events not memorialized in writing or otherwise recorded. As a result, the case turns on a combination of testimony and circumstantial evidence. Furthermore, it is undisputed Plaintiff lacks male Muslin witnesses to support his claims. Perhaps Plaintiff could appear in Saudi Labor Court and present his individual testimony, but he would do so without corroboration. Thus, it would be meaningless.
This finding does not render every non Anglo-American forum inadequate, as Defendants
Defendants' support for their position is unpersuasive. For example, Defendants state the court in Spradlin v. Lear Siegler Mgmt. Servs. Co., enforced a forum selection clause pointing to Saudi Arabia "even though Saudi Arabia has a significantly different judicial system." (Doc. 187 at 10) (citing Spradlin v. Lear Siegler Mgmt. Servs. Co., 926 F.2d 865, 869 (9th Cir. 1991)). But, in reaching its decision, the Spradlin court did not consider or discuss the characteristics of the Saudi court. As the Ninth Circuit stated in its decision in this case, Spradlin's dismissal was based on "plaintiff's failure `to come forward ... with anything beyond the most general and conclusory allegations of fraud and inconvenience' [regarding the forum selection clause]," not an evaluation of the adequacy of the alternative forum. Petersen v. Boeing Co., 715 F.3d 276, 280 (9th Cir. 2013) (citing Spradlin, 926 F.2d at 868). In Forsythe v. Saudi Arabian Airlines Corp., another out of circuit case cited by Defendants, the court was not provided with evidence "that a Saudi Arabian forum would treat [the plaintiff] unfairly or deprive him of all remedies." 885 F.2d 285, 290 (5th Cir.1989). By contrast, here there is direct, undisputed evidence Plaintiff would be treated unfairly in the Saudi forum.
In addition, it is rather unclear whether the Saudi Labor Courts are available or have jurisdiction to handle Plaintiff's claims. Although Plaintiff is suing an employer over events that took place during his period of employment and on the employer's property, the events involve what Defendant's expert indicated would likely be considered criminal conduct (e.g. coercion, false imprisonment), in which case he stated the claims would be transferred out
Based on the foregoing, the Court concludes the forum selection clause cannot be enforced. As a result, the case will not be dismissed, and the parties will proceed to discovery and resolution of the controversy in this Court.
Accordingly,