Opinion
CASE NO. 5:16-cv-2207
08-02-2017
HYDRODEC OF NORTH AMERICA LLC, PLAINTIFF, v. API HEAT TRANSFER, INC., DEFENDANT.
MEMORANDUM OPINION AND ORDER OF TRANSFER
Before the Court is the motion of defendant API Heat Transfer, Inc. ("API" or "defendant") for summary judgment on the issue of which terms and conditions apply to the instant contract dispute. (Doc. No. 20 ["MSJ"].) Plaintiff Hydrodec of North America LLC ("Hydrodec" or "plaintiff") filed a memorandum in opposition (Doc. No. 22 ["MSJ Opp'n"]), and defendant filed a reply (Doc. No. 23 ["MSJ Reply"]). The gravamen of defendant's motion is that the underlying contractual agreement contained a forum selection clause that sets venue exclusively in certain courts located in the State of New York. Plaintiff asserts that this clause is not part of the agreement. Defendant seeks a transfer to a federal district court in New York, pursuant to 28 U.S.C. § 1406(a), or, in the alternative, summary judgment in its favor on plaintiff's claims. For the reasons set forth below, defendant's motion is granted, and this case is transferred to the United States District Court for the Western District of New York.
I. BACKGROUND
Plaintiff is a "clean-tech oil" refining company that has its principal place of business in Canton, Ohio. (Doc. No. 1-1 (Complaint ["Compl."]) at ¶¶ 1, 15.) Non-party Zeton, Inc. ("Zeton") is a designer and manufacturer of modular plants. (Doc. No. 20-2 (Deposition of David Beckman ["Beckman Dep."]) at 8.) API manufactures heat transfer equipment and is headquartered in Buffalo, New York. (Doc. No. 20-1 (Deposition of Christian J. Pawlak ["Pawlak Dep."]) at 5; Compl. ¶ 6.) Zeton is a Canadian corporation that does not maintain an office, plant, or any other facility in the United States. (Beckman Dep. at 9.).
All page number references to depositions are to the page numbers assigned by the transcribing court reporter. All other page numbers in this memorandum opinion are to the page identification number generated by the Court's electronic docketing system.
In 2014, Hydrodec undertook plans to rebuild and expand its refining plant in Canton, Ohio ("Canton Project"). (Compl. ¶ 25.) On March 17, 2014, plaintiff entered into a written contact with Zeton whereby Zeton would supply the heat exchangers for the project. (Beckman Dep. at 16-17; Compl. ¶ 24.) Zeton, in turn, contracted with API to design and furnish the heat exchangers. (Beckman Dep. at 17.).
The general purpose of the heat exchangers at the Canton plant was to either heat up or cool down products or reactants going into another reactor. (Beckman Dep. at 16.) The heat exchangers would heat up industrial oil prior to going into the reactor. (Id. at 16.)
API and Zeton began negotiations for the Canton Project heat exchangers in October 2013 when Zeton contacted API and requested a price quote. (Doc. No. 20-11 (Deposition of Craig Soulsby ["Soulsby Dep."]) at 41.) This was not the first time the two companies had interacted, as the record reflects that Zeton and API have a history of doing business together that stretches back approximately fifteen years. (Pawlak Dep. at 7; Beckman Dep. at 14.) Because heat exchangers must be precisely engineered to meet the needs of the particular project, a Zeton project manager supplied API with the technical specifications for the Canton Project heat exchangers. (Soulsby Dep. at 32-33.).
Zeton's president and chief operating officer, David Beckman, estimated that the two companies were involved in approximately 50 to 100 business transactions over the course of their relationship. (Beckman Dep. at 14.)
Ultimately, API and Zeton agreed to two sales transaction, comprising the sale of six heat exchangers in total. On December 4, 2013, API sent Zeton a price quote for the first two heat exchangers. (Doc. No. 20-6 ["12-4-13 Quote"].) This quotation represented the fifth revision or iteration of the first price quotation that API had provided Zeton during the course of the negotiations. (Beckman Dep. at 65; Soulsby Dep. at 33.) The multi-page quote contained details regarding the specifications for the heat exchangers. It also contained specifics as to the following: pricing, which it indicated would be in effect until January 3, 2014; payment; drawing time; and shipping, including both the expected time for delivery and the location. (12-4-13 Quote at 250-51.).
Under the heading "Terms of Sale," the quote provided that it was offered "Per attached API Heat Transfer Terms and Conditions." (Id. at 251.) API's terms and conditions were appended to the quote, and several of these provisions are germane to the present dispute. (Id. at 252.) Most notably, API's terms and conditions contained a choice of law and forum selection clause that provided, in relevant part:
21. Governing Law. The Order Acknowledgement and these Terms and Conditions of Sale shall be governed by and construed in accordance with the internal laws of the State of New York, exclusive of such State's law with respect to conflicts of law. This purchase order shall be enforced against either party only in courts located in Erie County or any New York State County contiguous to Erie
County.(Id.) The document also set forth a limited warranty, restricted any remedy to repairs or replacement, and prohibited any reassignment of rights by the buyer without API's approval. (Id.) API's terms further limited acceptance to API's standard terms and conditions:
16. Controlling Provisions. If the Order Acknowledgement is accepted and Buyer's purchase order is used for any purpose, it is expressly understood and agreed that the terms and conditions set forth in the Order Acknowledgement and these Terms and Conditions of Sale shall prevail insofar as the same may in any way conflict with the terms and conditions set forth in Buyer's order form, and the issuance of such order by Buyer shall be deemed to note Buyer's assent to the foregoing. Provisions in Buyer's purchase orders contrary to these terms and conditions are not binding upon Seller unless accepted in writing by an authorized agent or representative of Seller. The terms and conditions of the Order Acknowledgement and herein shall supersede any provisions, terms and conditions contained in any confirmation, order or other writing Buyer may give or receive and the parties shall be governed exclusively by the provisions, terms and conditions hereof. Seller makes no representations or warranties concerning the Order Acknowledgment except such as are expressly contained in the Order Acknowledgement and these Terms and Conditions of Sale, which may not be changed or modified orally.(Id.)
On December 11, 2013, Zeton sent API a purchase order for the two API heat exchangers referenced in the December 4, 2013 quote. (Beckman Dep. at 67; Doc. No. 20-7 (12-10-13 e Purchase Order ["12-10-13 Purchase Order"]).) The four page purchase order identified the reference number listed on API's quote, as well as the price and various specifications set forth in the quote. At the bottom of the last page were the words "Subject to the attached General Terms and Conditions of purchase." (12-10-13 Purchase Order at 257.) Zeton does not dispute that its terms and conditions were not attached to the purchase order. (MSJ Opp'n at 322, record citations omitted.) Instead, Zeton explains that it has an informal policy whereby it does not generally provide its terms and conditions to suppliers with whom it has an established relationship. (Id., citing Beckman Dep. at 125-26.)
While the purchase order was dated December 10, 2013, the email to which this purchase order was attached was dated December 11, 2013. (Id. at 153.)
Though not appended to the purchase order, Zeton's terms and conditions differed from API's in several relevant respects. For instance, its terms reserved Zeton's right to pursue any and all damages against the seller, limited the agreement to the purchase order and Zeton's terms, and provided that the "work performed or goods supplied" under the contract are "to be interpreted and governed by the Laws of the Province of Ontario." (Doc. 20-5 (Zeton's General Terms and Conditions of Purchase ["Zeton's T&C"]) at 249.) These terms further provided that:
Zeton objects to and shall not be bound by any past or future terms and conditions not set forth herein, including any additional or inconsistent terms shown on Supplier's sales confirmation, shipping documents, or invoices, and any additions [or] inconsistences therein with the provisions hereof shall be null and void.(Id.) Zeton's terms would also not preclude assignment.
API sent a second quote, dated February 28, 2014, for the additional four heat exchangers. (Doc. No. 20-8 ["2-28-14 Quote"]; see Beckman Dep. at 78; Soulsby Dep. at 52.) Though shorter and less detailed, the second quote resembled the December 4, 2013 quote. (Soulsby Dep. at 55-56.) As was the case with the earlier quote, API's terms and conditions were appended to this second quote. (2-28-14 Quote at 259; Beckman Dep. at 66, 78; Soulsby Dep. at 34, 53.) Zeton responded with a purchase order, dated July 10, 2014. (Doc. No. 20-9 ["7-10-14 Purchase Order"].) The final page of this purchase order, at the bottom corner, contained the words "Subject to the attached General Terms and Conditions of purchase" but, once again, Zeton's terms were not sent with the purchase order. (Soulsby Dep. at 56.)
It is undisputed that API designed and delivered the six heat exchangers, which were installed in plaintiff's plant. Hydrodec alleges that the heat exchangers API supplied for the Canton Project failed, causing extensive damages at Hydrodec's Canton facility. (Compl. ¶¶ 35, 37.) On August 8, 2016, Hydrodec brought suit in state court against API, claiming that it was entitled to recover against API as Zeton's assignee. (Id. ¶¶ 47, 48.) The complaint raises claims for contribution and/or indemnification and damages. On September 2, 2016, the action was removed to federal court on the basis of diversity jurisdiction. (Doc. No. 1 (Notice of Removal).)
The Court permitted the parties to engage in a period of discovery on the limited issue of whether API's terms and conditions applied to the dispute. During this discovery period, the parties took several Fed. R. Civ. P. 30(b)(6) depositions of various API and Zeton employees. The parties have now completed this initial discovery and have fully briefed the threshold issue of venue.
II. STANDARD OF REVIEW
Under Fed. R. Civ. P. 56(a), when a motion for summary judgment is properly made and supported, it shall be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law."
An opposing party may not rely on allegations or denials in its own pleading; rather, by affidavits or by materials in the record, the opposing party must set out specific facts showing a genuine issue for trial. Fed. R. Civ. P. 56(c)(1). Affidavits or declarations filed in support of or in opposition to a motion for summary judgment "must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated." Fed. R. Civ. P. 56(c)(4). A movant is not required to file affidavits or other similar materials negating a claim on which its opponent bears the burden of proof, so long as the movant relies upon the absence of the essential element in the pleadings, depositions, answers to interrogatories, and admissions on file. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986).
In reviewing summary judgment motions, the Court must view the evidence in a light most favorable to the non-moving party to determine whether a genuine issue of material fact exists. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S. Ct. 1598, 26 L. Ed. 2d 142 (1970); White v. Turfway Park Racing Ass'n, 909 F.2d 941, 943-44 (6th Cir. 1990), impliedly overruled on other grounds by Salve Regina College v. Russell, 499 U.S. 225, 111 S. Ct. 1217, 113 L. Ed. 2d 190 (1991). A fact is "material" only if its resolution will affect the outcome of the lawsuit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). Determination of whether a factual issue is "genuine" requires consideration of the applicable evidentiary standards. Thus, in most civil cases the Court must decide "whether reasonable jurors could find by a preponderance of the evidence that the [non-moving party] is entitled to a verdict[.]" Id. at 252.
Summary judgment is appropriate whenever the non-moving party fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial. Celotex, 477 U.S. at 322. Moreover, "[t]he trial court no longer has the duty to search the entire record to establish that it is bereft of a genuine issue of material fact." Street v. J.C. Bradford & Co., 886 F.2d 1472, 1479-80 (6th Cir. 1989) (citing Frito-Lay, Inc. v. Willoughby, 863 F.2d 1029, 1034 (D.C. Cir. 1988)). The non-moving party is under an affirmative duty to point out specific facts in the record as it has been established that create a genuine issue of material Fact. Fulson v. City of Columbus, 801 F. Supp. 1, 4 (S.D. Ohio 1992). The non-movant must show more than a scintilla of evidence to overcome summary judgment; it is not enough for the non-moving party to show that there is some metaphysical doubt as to material facts. Id.
III. DISCUSSION
The question in light of the largely undisputed facts is whether API's standard terms and conditions are part of the parties' agreement and in particular, whether the choice of law and forum selection clauses therein apply. Plaintiff insists that the question must be answered in the negative in that Zeton's terms and conditions, including a choice of law provision calling for the application of Ontario law, governed the underlying business transactions.
Ohio Law Applies to the Choice of Law Inquiry
Federal courts sitting in diversity utilize the choice-of-law provision of the forum state. The Standard Fire Ins. Co. v. Ford Motor Co., 723 F.3d 690, 692 (6th Cir. 2013) (citing Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 85 L. Ed. 1477 (1941)); Moore v. Weinstein Co., LLC, 545 F. App'x 405, 410-11 (6th Cir. 2013) (citations omitted). "Ohio has adopted the Restatement (Second) of Conflicts of Laws, under which the court must apply the law of the state that has the most significant contacts to the dispute." Newberry v. Silverman, No. 1:14cv313, 2014 WL 4093143, at *2 (S.D. Ohio Aug. 18, 2014) (citing Morgan v. Brio Mfg. Co., Inc., 474 N.E.2d 286, 288-89 (Ohio 1984)).
Defendant is located in Buffalo, New York, and plaintiff is located in Ontario, Canada, and the two entities exchanged their quotes and purchase orders from their respective offices in Buffalo and Ontario. The heat exchangers, however, were designed, installed, and allegedly failed in a plant in Canton, Ohio, and purportedly caused damage to property in Ohio. Additionally, Hydrodec, API, and Zeton all conduct business in Ohio. (Compl. ¶¶ 1, 2, 5, 8.) Based on the undisputed facts, the Court concludes, and the parties agree, that Ohio has the most significant contacts to the contract and the dispute, and therefore Ohio law should apply to the analysis of the threshold issue of whether API's terms and conditions apply. (MSJ at 165; MSJ Opp'n 327.)
Contract Formation under Ohio Law
"In order to prove the existence of a contract, a plaintiff is required to demonstrate the essential requirements of an offer, acceptance, and consideration." Dyno Constr. Co. v. McWayne, Inc., 198 F.3d 567, 572 (6th Cir. 1999) (citing Helle v. Landmark, Inc., 472 N.E.2d 765, 773 (Ohio Ct. App. 1984)). "A valid and binding contract comes into existence when an offer is accepted." Id. (citing Realty Dev., Inc. v. Kosydar, 322 N.E.2d 328, 332 (Ohio Ct. App. 1974)).
Price quotes as offers
API argues that the price quotations it sent to Zeton on December 4, 2013 and February 28, 2014 constituted offers that were accepted by Zeton. "Typically, a price quotation is considered an invitation for an offer, rather than an offer to form a binding contract." Dyno Constr. Co., 198 F.3d at 572 (quotation marks and citations omitted). "However, a price quotation may suffice for an offer if it is sufficiently detailed and it reasonably appear[s] from the price quotation that assent to that quotation is all that is needed to ripen the offer into a contract." Id. (quotation marks and citation omitted). "While the inclusion of a description of the product, price, quantity, and terms of payment may indicate that the price quotation is an offer rather than a mere invitation to negotiate, the determination of the issue depends primarily upon the intention of the person communicating the quotation as demonstrated by all of the surrounding facts and circumstances." Id. (citations omitted). "Thus, to constitute an offer, a price quotation must 'be made under circumstances evidencing the express or implied intent of the offeror that its acceptance shall constitute a binding contract.'" Id. (quoting Maurice Elec. Supply Co. v. Anderson Safeway Guard Rail Corp., 632 F. Supp. 1082, 1087 (D.D.C. 1986)).
Courts have looked to a variety of factors to guide their analysis as to whether a price quotation is an offer, including "the extent of prior inquiry, the completeness of the terms of the suggested bargain, and the number of persons to whom the price quotation is communicated." Nordyne, Inc. v. Int'l Controls & Measurements Corp., 262 F.3d 843, 846 (8th Cir. 2001) (citing Restatement (Second) of Contracts § 26, comment c); Rich Prods. Corp. v. Kemutec, Inc., 66 F. Supp. 2d 937, 956 (E.D. Wis. 1999) (same) (citation omitted); see Stelluti Kerr, L.L.C. v. Mapel Corp., --F. App'x --, 2017 WL 2842149, at *8 (5th Cir. June 30, 2017) ("Although that inquiry necessarily depends on the facts of the particular case, it often turns of the quotation's level of detail, the extent of the prior inquiry, and the number of persons to whom the quotation was sent.") (citing, among authority, J.D. Fields & Co., Inc. v. U.S. Steel Int'l, Inc., 426 F. App'x 271, 280 (5th Cir. 2011)).
Here, the Court finds that the quotations were such that only Zeton's assent was necessary to form a binding contract, and were, therefore, offers under Ohio law. The December 4, 2013 quotation was specific as to price, quantity, payment, and location for delivery. The initial quote even provided a formula for calculating the time frame in which shipment would take place depending on when Zeton accepted the offer. Additionally, the quotes clearly identified the "Terms of the Sale" as API's standard terms and conditions, a copy of which was attached to each quote.
In addition to containing a detailed breakdown as to price, the December 4, 2013 quote also stated that the quoted prices were valid "until 1/03/14." (Dec. 4, 2013 Quote at 251.)
The quotes also contained clarifying details relating to the specification of the particular heat exchangers that were to be designed for the Canton Project, and both quotations were prepared for and sent exclusively to Zeton. In fact, the December 4, 2013 quote, which represented the fifth revised quote sent to Zeton, was the result of extensive discussions and negotiations that were initiated by Zeton. (Beckman Dep. at 65; Soulsby Dep. at 32-33, 41-42.) These undisputed facts demonstrate that, as a matter of law, the price quotes were offers. See Stelluti Kerr, 2017 WL 2842149, at *8 (price quote was an offer where it was "prepared and revised twice specifically" for the customer at the customer's request); Verasun Ford Dodge, L.L.C. v. Indus. Air Tech. Corp., No. C07-3013-MWB, 2008 WL 5069121, at *16 (N.D. Iowa Nov. 25, 2008) (collecting cases finding quotes involving similar facts to be offers and specifically noting that "this was a specific quotation custom-designed for a specific customer at that customer's request and not a generalized or unsolicited quote sent to a number of potential customers, such as price lists in a catalogue or other form of direct mail marketing"); see, e.g., Nordyne, 262 F.3d at 846-47 (quote sent to specific customer, after months of discussions, containing specifics as to quantity, price, and time in which to accept the offer qualified as an offer); SST Bearing Corp. v. MTD Consumers Grp., Inc., No C-040267, 2004 WL 2757601, at *2 (Ohio Ct. App. Dec. 3, 2004) (quote that contained a description of the goods and was specific as to price, quantity, delivery terms, and the period of time in which the stated prices would be honored was an offer under Ohio law).
Acceptance and the battle of the forms
Having concluded that API's price quotes were offers, the Court must now determine whether Zeton accepted the offers and whether it conditioned its acceptance on the inclusion of other terms and conditions. Hydrodec acknowledges that "API's terms and conditions did clearly state . . . that '[t]hese terms and conditions shall be binding upon Buyer unless otherwise stated in writing on the Order Acknowledgement.'" (Opp'n, at 329, quoting Doc. No. 20-4 (API Heat Transfer Terms and Conditions of Sale) at 948.) Still, it insists that "[t]his is precisely what Zeton did: every Purchase Order Zeton submitted to API for the purchase of the subject heat exchangers contained the following language: 'Subject to the attached General Terms and Conditions of purchase.'" (Id. at 329-30, quoting 12-10-13 Purchase Order at 257 and 7-10-14 Purchase Order at 266.) By including this language in the purchase orders, plaintiff insists that Zeton inserted additional (contradictory) terms into the agreement, resulting in a rejection of the original offers and the extension of counter-offers. (See id. at 331.)
At the outset, API posits that Zeton could not have introduced any additional or contradictory terms because it failed to attach its terms and conditions to the purchase orders. (See MSJ at 165, citing Beckman Dep. at 67, 73, and Soulsby Dep. at 49, 50, 56.) Hydrodec does not dispute that the terms forms were not attached, but insists, nonetheless, that API was familiar with Zeton's terms and conditions. (MSJ Opp'n at 323, citing Pawlak Dep. at 14.) While Christian Pawlak, a representative of API, testified in his deposition that he did not know if he was familiar with Zeton's terms, he conceded that he found multiple copies of Zeton's terms and conditions available at API's offices. (Pawlak Dep. at 14, 23-24.) In fact, there was undisputed evidence demonstrating that, as late as September 2013, a project manager at Zeton provided API with yet another copy of Zeton's terms. (Beckman Dep. at 69, 74-75, 97.) Construing these facts in a light most favorable to Hydrodec, as the non-moving party, the Court finds that there is at least a question of fact as to whether API had, or should reasonably have had, common knowledge of Zeton's contradictory terms and conditions.
Section 2-207 of the Uniform Commercial Code ("UCC"), commonly referred to as the "battle of the forms," addresses situations in which additional terms are contained in an acceptance. "This section of the Code recognizes that in current commercial transactions, the terms of the offer and those of the acceptance are seldom identical. Rather, under the current 'battle of the forms,' each party typically has a printed form drafted by his attorney and containing as many terms as could be envisioned to favor that party in his sale transaction." Dorton v. Collins & Aikman Corp., 453 F.2d 1161, 1166 (6th Cir. 1972). While minor differences between the parties' standard terms and conditions would have prevented the consummation of a contract under common law, UCC § 2-207 recognizes that the parties do not always intend that variations in the fine print terms should defeat a business transaction. Id.; see McJunkin Corp. v. Mech., Inc., 888 F.2d 481, 482 (6th Cir. 1989) ("Usually, these standard terms [in parties' respective terms and conditions forms] mean little, for a contract looks to its fulfillment and rarely anticipates a breach . . . It is only when the good faith expectations of the parties are frustrated that the legal obligations and rights of the parties must be precisely determined.") Section 2-207, therefore, supplies the framework for determining which terms and conditions apply when merchants engage in a battle of the forms.
Ohio's version of UCC § 2-207 is codified at Ohio Rev. Code § 1302.10. Section 1302.10(A) provides that "[a] definite and seasonable expression of acceptance or a written confirmation that is sent within a reasonable time operates as an acceptance even though it states terms additional or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms." Ohio Rev. Code § 1302.10(A). Under § 1302.10(B), "[t]he additional terms are to be construed as proposals for addition to the contract. Between merchants, the terms become part of the contract unless one of the following applies: (1) the offer expressly limits acceptance to the terms of the offer[;] (2) [t]hey materially alter it[; or] (3) [n]otification of objection to them has already been given or is given within a reasonable time after notice of them is received." Ohio Rev. Code § 1302.10(B).
The Sixth Circuit's decision in Dorton represents the seminal case addressing the language that is required in an acceptance under § 1302.10(A) to render it conditional on added or different terms. There, the court observed that "it is not enough that an acceptance is expressly conditional on additional or different terms; rather, an acceptance must be expressly conditional on the offeror's assent to those terms." Dorton, 453 F.2d at 1168 (emphasis in original). In Dorton, the court held that the use of language in an acceptance that provided that it was "subject to all of the terms and conditions on the face and reverse side hereof, including arbitration, all of which are accepted by buyer" was insufficient to render an acceptance conditional on the added terms. Id. at 1167. In so ruling, the court emphasized that, to be a conditional acceptance, the language must "clearly [reveal] that the offeree is unwilling to proceed with the transaction unless he is assured of the offeror's assent to the additional or different terms therein." Id. at 1168 (citation omitted); see MTD Consumers Grp., 2004 WL 2757601, at *4 (language that merely stated that the acceptance was "limited to" the added terms and did not state that the offeror's assent to the added terms was necessary did not make the acceptance expressly conditional) (citing Dorton, 435 F.2d at 1167-68).
Applying the rule in Dorton, it is evident that Zeton's language "[s]ubject to the attached Terms and Conditions of purchase" can hardly be considered sufficient to render Zeton's acceptance conditional on the added terms. The purchase orders did not state Zeton would be unwilling to go forward with the transactions unless API agreed to the additional terms, and, in fact, Zeton did go forward with the transactions, notwithstanding the fact that API never affirmatively accepted Zeton's terms. The purchase orders' language, therefore, did not make acceptance conditional on the inclusion of Zeton's choice of law provision. See Stemcore USA, Inc. v. Trident Steel Corp., 471 F. Supp. 2d 362, 367-69 (S.D.N.Y. 2006) (finding language suggesting that acceptance was limited to certain terms insufficient to establish expressly conditional acceptance, and distinguishing cases where acceptance was made expressly conditioned on assent to the additional or different terms and conditions) (citing Dorton, 435 F.2d at 1167-68).
The court in Rayco Mfg. v. Deutz Corp., No. 5:08 CV 74, 2008 WL 2433823 (N.D. Ohio June 12, 2008), rejected an argument--similar to Hydrodec's--that the defendant's order confirmations served as rejections and counter-offers, subject to its own terms and conditions. Relying on Dorton, the court noted that the defendant's order confirmations, while providing for the application of defendant's terms and conditions, failed to make such acceptance contingent upon the plaintiff accepting defendant's additional terms. Rayco, 2008 WL 2433823, at *3 (citing Ohio Rev. Code § 1302.10(A)). The court further found that, like the present case, the additional terms contained in the acceptance did not become part of the contract, under Ohio Rev. Code § 1302.10(B), because the terms and conditions contained in the plaintiff's offer limited the terms and conditions to those stated in the offer. Id. at *4. Thus, to the extent that plaintiff relies on Rayco to support its position that its acceptances were really counter-offers, the reliance is misplaced. --------
Because Zeton's purchase orders were not expressly conditioned on API's assent to the additional and contradictory terms, the documents constituted acceptances that served to consummate a contract under Ohio Rev. Code § 1302.10(A). Zeton's terms are consequently treated as "proposals" for addition to the contract under § 1302.10(B), and, because Zeton and API are both merchants, these terms can become part of the contract unless one of the three exceptions to subsection B applies. Here, however, API's terms and conditions expressly limit acceptance of its offers to API's terms and conditions. (12-4-13 Quote at 252 ["If the Order Acknowledgement is accepted and Buyer's purchase order is used for any purpose, it is expressly understood and agreed that the terms and conditions set forth in the Order Acknowledgement and these Terms and Conditions of Sale shall prevail insofar as the same may in any way conflict with the terms and conditions set forth in Buyer's order form, and the issuance of such order by Buyer shall be deemed to note Buyer's assent to the foregoing."].) Accordingly, under § 1302.10(B)(1), the proposals could not be accepted and API's terms and conditions control.
The Court concludes that API's standard terms and conditions, including its forum selection clause, are part of the parties' contract. "Absent evidence of fraud or overreaching, a forum selection clause contained in a commercial contract between business entities is valid and enforceable, unless it can be clearly shown that enforcement of the clause would be unreasonable and unjust." Kennecorp Mortg. Brokers, Inc. v. Country Club Convalescent Hosp., Inc., 610 N.E.2d 987 (Ohio 1993), syllabus; see also 610 N.E.2d 989 (citing The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15, 92 S. Ct. 1907, 32 L. Ed. 2d 513 (1972)). Hydrodec makes no such argument here regarding the forum selection clause. Therefore, the forum selection clause in this commercial contract is valid and enforceable.
In closing, the Court notes that its ruling relates solely to the question of the applicability of the forum selection clause in API's standard terms and conditions. This Court take no position on the validity or enforceability of any other provision contained in those terms and conditions, as that is a contractual determination to be made on the merits by a court in the proper forum.
API also expressly seeks summary judgment on all claims brought against it by Hydrodec on the strength of the provision in its terms and conditions purporting to prohibit assignment of rights. But, in view of the Court's determination that the case should be transferred, it will not address the parties' arguments with respect to Zeton's assignment of rights to Hydrodec, leaving that for resolution by an appropriate court.
IV. CONCLUSION
For the reasons discussed, Hydrodec's motion for summary judgment is granted, insofar as it seeks to transfer venue. Pursuant to 28 U.S.C. § 1404(a), this case is transferred to the United States District Court for the Western District of New York.
IT IS SO ORDERED. Dated: August 2, 2017
/s/ _________
HONORABLE SARA LIOI
UNITED STATES DISTRICT JUDGE