NATHANIEL M. GORTON, District Judge.
Plaintiff Edward Reynoso ("plaintiff" or "Reynoso") brings this purported class action against LaserShip, Inc. ("LaserShip") and its Chief Executive Officer ("CEO"), Blake Averill (collectively "defendants"), for alleged violations of the Massachusetts Wage Act and Massachusetts overtime laws. Reynoso contends that LaserShip classifies its employees as independent contractors in order to avoid paying overtime wages.
Pending before the Court is LaserShip's motion to dismiss or, in the alternative, to transfer venue to the United States District Court for the Eastern District of Virginia pursuant to 28 U.S.C. § 1404(a). For the reasons that follow, the motion will be allowed and the case will be transferred.
Throughout his employment with the company, Reynoso was responsible for delivering packages for LaserShip and was paid according to the number of deliveries he made. LaserShip assigned Reynoso certain routes, set his schedule, prevented him from delivering for any other company, required him to drive a white van and provided him with a uniform bearing the LaserShip logo. LaserShip also required Reynoso to report to the warehouse for each day of work by 8:30 a.m. to retrieve packages and to call the warehouse at the end of the day to confirm that the routes were complete. Reynoso asserts that he, and others similarly situated, have been misclassified as independent contractors and that there was an employer-employee relationship between LaserShip and those providing equipment and labor services to LaserShip.
Reynoso also alleges that as a result of that misclassification, he and other delivery drivers have suffered damages and incurred expenses that should have been paid by LaserShip, such as expenses for gasoline, vehicle maintenance and payroll taxes. Further, Reynoso and other drivers regularly worked more than 40 hours per week and, because paystubs did not include all hours worked, Reynoso and others similarly situated suffered lost wages.
Reynoso brought this action in Massachusetts Superior Court for Middlesex County asserting claims individually and on behalf of others similarly situated for 1) misclassification as independent contractor in violation of the Wage Act, M.G.L. c. 149, §§ 148B & 150 ("the Wage Act"), 2) nonpayment of overtime wages in violation of the Massachusetts Overtime Law, M.G.L. c. 151, §§ 1A & 1B, 3) nonpayment of earned overtime wages in violation of M.G.L. c. 149, §§ 148 & 150, 4) failure to maintain proper payroll records in violation of M.G.L. c. 149, § 148, M.G.L. c. 151, § 15 and 454 CMR 27.02(2) and 5) unjust enrichment. LaserShip timely removed the case to this Court on diversity grounds.
LaserShip moves to dismiss or to transfer venue (Docket No. 12). For the foregoing reasons, that motion will be allowed.
The Supreme Court has held that the appropriate mechanism to enforce a forum-selection clause is through a motion to transfer under 28 U.S.C. § 1404(a).
The Court expressly declined to consider whether a motion to dismiss for failure to state a claim under Rule 12(b)(6) is a proper alternative for enforcement of a forum-selection clause.
Normally, while the decision to transfer a case under § 1404(a) lies solely within the discretion of the trial court, there is a presumption in favor of the plaintiff's choice of forum.
Nevertheless, the Court in
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LaserShip moves to dismiss Reynoso's claims pursuant to Fed. R. Civ. P. 12(b)(6) or, in the alternative, to transfer venue pursuant to 28 U.S.C. § 1404(a). Reynoso admits the forum selection clause exists, but responds that it is against public policy because it does not allow Massachusetts residents to bring claims pursuant to Massachusetts law and is therefore unenforceable.
LaserShip first moves to dismiss Reynoso's claim for failure to state a claim under Rule 12(b)(6). Although Rule 12(b)(6) remains a proper vehicle to seek enforcement of a forum selection clause in this Circuit, a district court should "ordinarily" use § 1404(a) to enforce a forum-selection clause that identifies a federal forum for the convenience of the parties and in the interest of justice.
The forum-selection clause in the Agreement does not require that action be brought in the Eastern District of Virginia. Instead, it states that any legal proceeding under federal law will be brought in Vienna, Virginia or the nearest location in Virginia in which the proceeding can be maintained. That language indicates that the parties have agreed to bring any federal actions in the Eastern District of Virginia because it encompasses Vienna, Virginia.
Because (1) the Supreme Court has held that a district court should "ordinarily" rely upon § 1404(a) to enforce a forum-selection clause and (2) the appropriate federal district for venue can be determined by the forum-selection clause, obviating the need for plaintiff to refile if the case is transferred pursuant to § 1404(a), this Court will proceed to consider defendants' motion to transfer pursuant to § 1404(a).
LaserShip contends that the forum-selection clause in the Agreement should be enforced because there is no public interest warranting a refusal to transfer, the forum selection clause encompasses the claims brought in this action and the forumselection clause is mandatory, as opposed to permissive. Reynoso responds by suggesting that the forum-selection clause is invalid because it effectively waives rights under the Wage Act in violation of the anti-waiver provision. He also rejoins that the forum-selection clause is invalid because it contravenes Massachusetts public policy.
The analysis established in Atlantic Marine warrants enforcement of the forum-selection clause and transfer pursuant to § 1404(a). First, the fact that Reynoso filed this action in Massachusetts is entitled to no weight.
Enforcement of the forum-selection clause in the Agreement does not constitute a waiver of Reynoso's rights under the Wage Act. Plaintiff's contention that Virginia courts will decline to apply Massachusetts law, effectively allowing the forum-selection clause to operate as a waiver of rights, is unavailing. First, although the Wage Act
The plaintiff has failed to demonstrate that the transferee Court would apply choice-of-law rules contrary to Massachusetts law. Virginia courts will set aside choice of law provisions where application of the law of the chosen state would be adverse to a fundamental policy of a state which has a materially greater interest than the chosen state.
In a similar putative class action, brought in Massachusetts state court and later transferred to the Eastern District of Virginia, the transferee court determined that, notwithstanding a valid choice-of-law provision in the independent contractor agreement, Massachusetts law would apply to plaintiffs' claims because the underlying contracts were made and performed in Massachusetts and Massachusetts "ha[d] a policy interest in the subject matter of the case".
Reynoso has not met his burden of demonstrating that Virginia's choice-of-law rules would select a law other than Massachusetts. Accordingly, the forum-selection clause does not operate as a "special contract" that would impermissibly waive rights under the Wage Act and the motion to transfer will be allowed.
LaserShip also moves, in the alternative, to dismiss Reynoso's claims on the theory that Reynoso is required to arbitrate under the Agreement's mandatory arbitration clause. Reynoso responds that the class/joinder waiver in the arbitration clause is unlawful because it contravenes Section 7 of the National Labor Relations Act, 29 U.S.C. §§ 151 et seq. Although plaintiff's argument has since been rejected by the United States Supreme Court,
LaserShip moves for fees, costs and damages associated with this motion to transfer pursuant to 28 U.S.C. § 1927, contending that plaintiff's counsel refused to transfer the action to Virginia voluntarily despite the advice of defendants' counsel with respect to the forum-selection and arbitration clauses of the Agreement.
Plaintiff's counsel has not complicated the proceedings so unreasonably or vexatiously as to require his payment of fees and penalties.
Courts generally reserve sanctions for cases where attorneys pursue frivolous and time-consuming arguments unsupported by fact or law.
For the foregoing reasons, defendants' motion to dismiss or transfer venue (Docket No. 12) is