ROBERT J. CONRAD, Jr., District Judge.
Plaintiff is a Delaware corporation doing business in Mecklenburg County. Plaintiff's business involves the distribution and maintenance of trash containers. Defendant is a California corporation that manufactures, sells, and services trash container trucks.
Accepting the factual allegations of the Complaint as true, in July 2013, Plaintiff offered to purchase four compressed natural gas trucks with extended warranties from Defendant. (Doc. 1: Complaint ¶ 8). On July 31, 2013, pursuant to prior conversations between the parties as well as an initial invoice from Defendant, Plaintiff sent a purchase order via email to Defendant with the PO number "M000000216" (the "Initial PO"). (Doc. No. 13-1). The subject line of the email was "GREENKRAFT-M216." (
On August 12, 2013, Defendant sent an email under the same subject line of "GREENKRAFT-M216" to Plaintiff, which read, "Can you have our two forms signed please we need those to get the incentives [sic]." (Doc. No. 13-2). Plaintiff responded on August 13, 2013, by emailing the signed forms back to Defendant. (
Defendant delivered the four trucks to Plaintiff, and on February 28, 2014, Defendant issued two invoices to Plaintiff. (Doc. Nos. 1-2, 1-3). One invoice was for the four trucks, and the other invoice was for the extended warranties. (
On May 29, 2015, Plaintiff filed its Complaint in this Court alleging claims for breach of contract, negligent misrepresentation, and unfair and deceptive trade practices under North Carolina law. Plaintiff's Complaint contains additional facts regarding the occurrences after the trucks were delivered and the alleged problems with Defendant's warranty and servicing work on the trucks. However, those facts are irrelevant to the Court's determination of Defendant's Motion, so they are not further discussed in this Order.
On August 7, 2015, Defendant filed its "Motion to Dismiss, or, Alternatively, Transfer Venue," (Doc. No. 10), challenging both personal jurisdiction and venue. The Magistrate Judge issued an M&R on October 8, 2015, (Doc. No. 16), concluding that Plaintiff's Initial PO was never accepted and that the parties' agreement did not include a forum selection clause. It also concludes that the Court has no general or specific jurisdiction over Defendant, and therefore, it recommends that Defendant's Motion to Dismiss be granted. Plaintiff filed objections to the M&R on October 26, 2015, (Doc. No. 17), which enumerated six objections. In general, Plaintiff objects to the M&R's treatment of Plaintiff's allegations, its findings that the parties' agreement did not include a forum selection clause, and to its recommendation that Defendant's Motion be granted.
The issues have been fully briefed and are ripe for adjudication.
A district court may assign dispositive pretrial matters, including motions to dismiss, to a magistrate judge for "proposed findings of fact and recommendations." 28 U.S.C. § 636(b)(1)(A) and (B). The Federal Magistrate Act provides that "a district court shall make a de novo determination of those portions of the report or specific proposed findings or recommendations to which objection is made."
Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, the plaintiff bears the burden of setting forth facts sufficient to demonstrate personal jurisdiction.
In its Motion, Defendant argues that the Court lacks general or specific jurisdiction because Defendant lacks sufficient contacts with North Carolina to be hauled into court here. Defendant also contends that the forum selection clause included in the terms and conditions of Plaintiff's Initial PO does not apply because the Initial PO was not signed, rather the Second PO, which did not contain any terms or conditions, was signed by both parties.
Plaintiff replies that the forum selection clause contained in its Initial PO is valid and enforceable. Therefore, Plaintiff contends that Defendant has consented to jurisdiction in this Court and has waived any objections based on any alleged lack of personal jurisdiction or improper venue. Accordingly, Plaintiff objects to the M&R because it ultimately finds that the forum selection clause does not apply and that Defendant's Motion should be granted. Plaintiff focuses its argument solely on the application of the forum selection clause, and it does not address or provide any substantive argument that jurisdiction exists outside of the clause. In fact, both parties agree that the determination of Defendant's Motion to Dismiss hinges on whether the terms and conditions of Plaintiff's Initial PO are applicable, thereby giving this Court jurisdiction over Defendant pursuant to the forum selection clause.
Article 2 of the Uniform Commercial Code ("UCC") governs the formation of contracts for the sale of goods. U.C.C. § 2-102.
The UCC's expanded concept of contract formation also allows for acceptances of offers to occur even when the documents exchanged by the parties are not in complete agreement. Pursuant to UCC § 2-207(1) "[a] definite and seasonable expression of acceptance or a written confirmation . . . operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms." Although no exact language is required to show that an acceptance is expressly conditional on assent to the terms of that acceptance, the offeree must make it clear to the offeror that the offeree is not willing to proceed with the transaction unless the offeree's terms are accepted.
As Defendant states, UCC § 2-207 "addresses circumstances in which the offer for the purchase of goods contains terms which the acceptance for the purchase of those goods does not contain and does not expressly reject." (Doc. No. 14 at 7-8). Contrary to Defendant's argument, that is precisely the situation presented in this case. After having conversations with and receiving a quote from Defendant, Plaintiff made an offer to purchase the trucks by sending Defendant the Initial PO. The Initial PO was emailed to Defendant under the subject line "GREENKRAFT-M216," which signified Plaintiff's purchase order number "M000000216." (Doc. No. 13-1 at 1-2). The Initial PO set forth the requested goods and prices, and it contained the terms and conditions of Plaintiff's offer, including, among others, a forum selection clause, which established Mecklenburg County, North Carolina, as the forum in which any dispute between Plaintiff and Defendant shall be litigated. Those terms and conditions established the parameters of the deal Plaintiff was willing to consummate.
Regarding acceptance, the Initial PO stated, "The Terms and Conditions which are attached hereto are incorporated and made part of this Purchase Order and are binding upon the Seller by its acceptance or performance under this Purchase Order." (
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Defendant has offered no evidence showing that it voiced any objection to the terms contained in the Initial PO or that it responded to Plaintiff's offer with any different or additional terms. In fact, every document sent by Defendant subsequent to Plaintiff's Initial PO was completely silent as to any term or condition. Several weeks after receiving the Initial PO, Defendant emailed Plaintiff, under the same subject referencing Plaintiff's PO number "M216," requesting that Plaintiff sign two of Defendant's forms so that Defendant could arrange to get the incentives. (Doc. No. 13-2). The next day, Defendant sent another email under the same subject header requesting that Plaintiff also sign the Second PO. (
Viewing the evidence in the light most favorable to Plaintiff, the Court finds that the terms and conditions contained in Plaintiff's Initial PO are part of the contract between Plaintiff and Defendant. Therefore, the forum selection clause, which provides that any dispute shall be maintained in Mecklenburg County, North Carolina, is applicable. Forum selection clauses are generally binding and will be enforced unless enforcement is "unreasonable under the circumstances."