Opinion
6:19-cv-1469-MC
04-07-2020
PATRICK STRAWN, an individual, Plaintiff, v. CARPENTERS SOUTHWEST ADMINISTRATIVE CORPORATION, a California Non-Profit Corporation, SOUTHWEST CARPENTERS PENSION TRUST, and CONSTRUCTION INDUSTRY AND CARPENTERS JOINT PENSION TRUST FOR SOUTHERN NEVADA, Defendants.
OPINION AND ORDER
MICHAEL J. MCSHANE, UNITED STATES DISTRICT JUDGE
Plaintiff Patrick Strawn filed this action seeking damages under the Employment Retirement Income Security Act (“ERISA”). Pl.'s Resp. 2, ECF No. 26. Defendants Carpenters Southwest Administrative Corporation, Southwest Carpenters Pension Trust, and Construction Industry and Carpenters Joint Pension Trust for Southern Nevada moves to change or transfer the case pursuant to 28 U.S.C. § 1404(a). Defs.' Mot. 2, ECF No. 17. Because the parties' ERISA plan contains a valid and enforceable forum selection clause and Plaintiff offers no compelling reason to set it aside, Defendants' Motion to Change or Transfer Venue, ECF No. 17, is GRANTED.
DISCUSSION
Generally, a district court may transfer an action to another district where it may have been brought “[f]or the convenience of parties and witnesses” and “in the interest of justice.” 28 U.S.C. § 1404(a). Here, Plaintiff's ERISA plan contains a forum selection clause requiring that all disputes arising from the agreement be brought in the Western Division of the United States District Court of California for the Central District of California. Defs.' Mot. 2-3. Specifically, Plan Amendment 2017-2 states:
Any litigation action in connection with the Fund or Plan commenced by an Employee, Participant or beneficiary may only be brought in Federal District Court in Los Angeles County, California.
Guerrero Decl. Ex. 2, at 2, ECF No. 18.
Courts generally enforce forum selection agreements except under extraordinary circumstances because they define the legitimate expectations of the parties as to where and how disputes will be resolved. See Atl. Marine Constr. Co., Inc. v. U.S. Dist. Court for the W. Dist. of Texas, 571 U.S. 49, 63 (2013) (holding that a court must give a forum selection clause “controlling weight in all but the most exceptional cases.”). The burden is on the plaintiff to establish that a transfer to the controlling forum is unwarranted. Id. A forum selection clause controls absent a strong showing that the court should disregard it. M/S Bremen v. Zapata Off- Shore Co., 407 U.S. 1, 15 (1972). The plaintiff must “clearly show that enforcement would be unreasonable and unjust, or that the clause [is] invalid for such reasons as fraud or overreaching.” Id.
This presumption of validity applies in the ERISA context as well. 29 U.S.C. § 1132(e)(2) provides that a plaintiff may bring an ERISA action “in the district where the plan is administered, where the breach took place, or where a defendant resides or may be found.” This language is permissive, not mandatory. See Smith v. Aegon Companies Pension Plan, 769 F.3d 922, 932 (6th Cir. 2014); In re Mathias, 867 F.3d 727, 732 (7th Cir. 2017). The venue selection clause in this case provides that suit must be brought in the Central District of California, the district where the plan is administered. Defs.' Mot. 8; Pl.'s Resp. 19. In addition to the Sixth and Seventh Circuits, district courts in the Ninth Circuit “have uniformly found that forum-selection clauses in ERISA plans do not contravene ERISA's venue provision and are enforceable.” Rapp v. Henkel of Am., Inc., No. 8:18-CV-01128-JLS-E, 2018 WL 6307904, at *2 (C.D. Cal. Oct. 3, 2018). This Court agrees.
See also Johnson v. Copiers Nw., Inc., No. 16-CV-1556-SI, 2017 WL 1968605, at *9 (D. Or. May 12, 2017) (holding the venue selection clause at issue valid and enforceable); Marin v. Xerox Corp., 935 F.Supp.2d 943, 947 (N.D. Cal. 2013) (holding that the venue selection clause was controlling and would not violate fundamental fairness); Rodriguez v. PepsiCo Long Term Disability Plan, 716 F.Supp.2d 855, 860-61 (N.D. Cal. 2010) (holding that “[e]nforcement of a forum selection clause is not inconsistent with the terms or policy rationales of ERISA” and “[n]othing in the statutory language bars those negotiating ERISA plans from narrowing that menu of options to one venue in particular.”); Testa v. Becker, No. CV10638GHKFMOX, 2010 WL 1644883, at *4 (C.D. Cal. Apr. 22, 2010) (“No circuit court decision has considered whether ERISA forbids all FSCs. Of the district courts that have reached the decision, the weight of authority lies with the enforcement of FSCs in ERISA plans.”); Bernikow v. Xerox Corp. Long-Term Disability Income Plan, No. CV 06-2612 RGKSHX, 2006 WL 2536590, at *2 (C.D. Cal. Aug. 29, 2006) (“Had Congress sought to prevent plaintiffs from waiving the statutory venue provision by private agreement, it could have done so by express provision. Until the Ninth Circuit or Congress speaks to the contrary, there is little justification to hold against the general presumption in favor of enforcing forum selection clauses.”).
Plaintiff offers no compelling reason to warrant setting aside the forum selection clause. Plaintiff argues that enforcement of the clause would be “unreasonable and unjust” because he did not freely negotiate with Defendants or have notice of the chosen venue. Pl.'s Resp. 12-18. Defendants added the forum selection clause to Plaintiff's plan by amendment. Defs.' Mot. 11. Union trustees negotiated the terms of Plaintiff's plan and the amendment on behalf of Plaintiff. See Guerrero Decl. Exs. 1 and 2. “[T]he Supreme Court has recognized the validity of forum selection clauses even when those clauses were not the product of an arms-length transaction.” Smith, 769 F.3d at 932 (citing Carnival Cruise Lines v. Shute, 499 U.S. 585, 595 (1991) (enforcing a forum selection clause on the back of a cruise ticket)).
Further, direct notice was not required here. See Laasko v. Xerox Corp., 566 F.Supp.2d 1018, 1024 (C.D. Cal. 2008) (explaining that “strict application of [a notice requirement] would invalidate every forum selection clause in an employee welfare plan, ” yet district courts “readily enforce” those clauses because “the employer, who negotiated the plan, did have notice of the clause and the ability to reject the contract.”). Even if notice were required, the 2016 Summary Plan Description on Defendants' website gave Plaintiff express notice of the forum requirement. Defs.' Mot. 14.
Because the forum selection clause is valid and enforceable, Plaintiff's choice of forum is not controlling. See Atl. Marine Constr. Co., Inc., 571 U.S. at 62-64. Accordingly, this matter shall be transferred to the Central District of California for further proceedings.
CONCLUSION
Defendants' Motion to Change or Transfer Venue, ECF No. 17, is GRANTED. The matter shall be transferred to the Western Division of the United States District Court of California for the Central District of California for further proceedings. Because the case law overwhelmingly supports enforcing forum selection clauses in ERISA cases, Defendants' request for reasonable attorney fees may be submitted to the court by way of a petition.
IT IS SO ORDERED.