Klecher v. Conmed Corporation

MOTION to Dismiss for Failure to State a Claim Pursuant to FRCP 12

S.D. Cal.May 22, 2017

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 17-CV-00643-JLS-KSC NOTICE OF MOTION AND MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) 29912410_1.docx Rafael G. Nendel-Flores CA Bar No. 223358 rafael.nendelflores@ogletree.com Mark F. Lovell CA Bar No. 246652 mark.lovell@ogletree.com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Park Tower, Fifteenth Floor 695 Town Center Drive Costa Mesa, CA 92626 Telephone: 714.800.7900 Facsimile: 714.754.1298 Attorneys for Defendant CONMED CORPORATION UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA CHRIS KLECHER Plaintiff, v. CONMED CORPORATION Defendant. Case No. 17-CV-00643-JLS-KSC DEFENDANT CONMED CORPORATION’S NOTICE OF MOTION AND MOTION TO DISMISS PLAINTIFF’S COMPLAINT FOR FAILURE TO STATE A CLAIM (RULE 12(B)(6)); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) [Concurrently filed with Memorandum of Points and Authorities; Declaration of Daniel S. Jonas; [Proposed] Order] Date: July 6, 2017 Time: 1:30 p.m. Place: 4D Complaint Filed: March 29, 2017 Trial Date: None Judge: Hon. Janis L. Sammartino Case 3:17-cv-00643-JLS-KSC Document 7 Filed 05/22/17 PageID.28 Page 1 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 Case No. 17-CV-00643-JLS-KSC NOTICE OF MOTION AND MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) 29912410_1.docx TO PLAINTIFF AND HER ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on July 6, 2017, at 1:30 p.m., or as soon thereafter as the parties may be heard in Courtroom 4D, of the above-entitled Court located at the 221 West Broadway, San Diego, California 92101, Defendant CONMED CORPORATION (“Defendant”) will move the Court for dismissal, with prejudice, of Plaintiff CHRIS KLECHER’S (“Plaintiff”) Complaint. In the alternative, Defendant will move the Court to transfer Plaintiff’s claims to the appropriate court in accordance with a valid forum selection clause. Defendant’s motion is made on the following grounds and as more fully set forth in the concurrently filed memorandum of points and authorities: 1. The Complaint and each claim for relief is subject to dismissal a valid forum selection clause requires each claim to be litigated in a different court. Thus, this Court cannot grant relief on the complaint or any claim therein. FED. R. CIV. P. 12(b)(6); See Silva v. Encyclopedia Britannica Inc., 239 F.3d 385, 387-388 (1st Cir. 2001); Instrumentation Assocs., Inc. v. Madsen Elecs. Ltd., 859 F.2d 4, 6, n. 4 (3d Cir.1988); Mix v. Neeb (E.D.Cal. 2014) 2014 WL 6469130, at *2-3; Verifone, Inc. v. A Cab, LLC (D. Nev. 2016) 2016 WL 44806862016 at *2. 2. Plaintiff’s second claim for Declaratory Relief fails to state a claim upon which relief can be granted because there is no case or controversy. FED. R. CIV. P. 12(b)(6). FED. R. CIV. P. 12(b)(1). 3. In the alternative, Defendant requests that the matter be transferred to the appropriate court pursuant to the valid forum selection clauses entered into between the parties. 28 U.S.C. § 1404(a); Atlantic Marine Const. Co. v. U.S. Dist. Court for W. Dist. Of Texas, 134 S. Ct. 568, 580 (2013). / / / / / / / / / / / / Case 3:17-cv-00643-JLS-KSC Document 7 Filed 05/22/17 PageID.29 Page 2 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2 Case No. 17-CV-00643-JLS-KSC NOTICE OF MOTION AND MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) 29912410_1.docx Defendant’s motion to dismiss is based on this notice of motion and motion, the memorandum of points and authorities filed concurrently with this motion, the Declaration of Daniel S. Jonas, on all the pleadings and papers in this action, and on any oral argument entertained by the Court during the hearing on this matter. DATED: May 22, 2017 OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. By: /s/ Mark F. Lovell Rafael G. Nendel-Flores Mark F. Lovell Attorneys for Defendant CONMED CORPORATION Case 3:17-cv-00643-JLS-KSC Document 7 Filed 05/22/17 PageID.30 Page 3 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3 Case No. 17-CV-00643-JLS-KSC NOTICE OF MOTION AND MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) 29912410_1.docx PROOF OF SERVICE Klecher v. Conmed Corporation, et al. Case No. 17-cv-00613-JLS-KSC I am and was at all times herein mentioned over the age of 18 years and not a party to the action in which this service is made. At all times herein mentioned I have been employed in the County of Orange in the office of a member of the bar of this court at whose direction the service was made. My business address is Park Tower, Suite 1500, 695 Town Center Drive, Costa Mesa, CA 92626. On May 22, 2017, I served the following document(s): DEFENDANT CONMED CORPORATION’S NOTICE OF MOTION AND MOTION TO DISMISS PLAINTIFF’S COMPLAINT FOR FAILURE TO STATE A CLAIM (RULE 12(B)(6)); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) by placing (the original) (a true copy thereof) in a sealed envelope addressed as stated on the attached service list. Jay R. Strauss David C. Winton WINTON STRAUSS LAW GROUP, P.C. 2 Ranch Drive Novato, CA 94945 Telephone: (415) 265-5555 Facsimile: (415) 265-985-2112 jrs@wintonstrauss.com dcw@wintonstrauss.com Attorneys for Plaintiff, CHRIS KLECHER BY ECF: with the Clerk of the United States District Court of Southern District of California, using the CM/ECF System. The Court’s CM/ECF System will send an e-mail notification of the foregoing filing to the following parties and counsel of record who are registered with the Court’s CM/ECF System: (Federal): I declare that I am employed in the office of a member of the State Bar of this Court at whose direction the service was made. I declare under penalty of perjury under the laws of the United States of America that the above is true and correct. Executed on May 22, 2017, at Costa Mesa, CA. Diane Vo Type or Print Name Signature 29912410.1 Case 3:17-cv-00643-JLS-KSC Document 7 Filed 05/22/17 PageID.31 Page 4 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx Rafael G. Nendel-Flores CA Bar No. 223358 rafael.nendelflores@ogletree.com Mark F. Lovell CA Bar No. 246652 mark.lovell@ogletree.com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Park Tower, Fifteenth Floor 695 Town Center Drive Costa Mesa, CA 92626 Telephone: 714.800.7900 Facsimile: 714.754.1298 Attorneys for Defendant CONMED CORPORATION UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA CHRIS KLECHER Plaintiff, v. CONMED CORPORATION Defendant. Case No. 17-CV-00643-JLS-KSC MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS PURSUANT TO FRCP 12(B)6); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) [Concurrently filed with Notice of Motion and Motion; Declaration of Daniel S. Jonas; [Proposed] Order] Date: July 6, 2017 Time: 1:30 p.m. Place: 4D Complaint Filed: March 29, 2017 Trial Date: None Judge: Hon. Janis L. Sammartino Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.32 Page 1 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 i Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx TABLE OF CONTENTS Page MEMORANDUM OF POINTS AND AUTHORITIES....................................... 1 I. INTRODUCTION .................................................................................... 1 II. STATEMENT OF FACTS....................................................................... 1 III. LEGAL ARGUMENT.............................................................................. 3 A. The Court Should Dismiss This Case Because It Fails To State A Claim Upon Which Relief Can Be Granted ...................... 3 B. The Court Should Dismiss Plaintiff’s Second Claim for Declaratory Relief Because There is No Case or Controversy .................................................................................... 4 C. In the Alternative, The Court Should Transfer This Case to the Proper Court Pursuant To 28 U.S.C. § 1404(a). .................. 5 1. The Forum Selection Clauses are Valid and Enforceable .......................................................................... 7 2. The Forum Selection Clauses Apply To This Action........12 3. The Forum Selection Clauses Are Mandatory, Not Permissive ..........................................................................13 IV. CONCLUSION....................................................................................... 14 Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.33 Page 2 of 20 ii Case No. 17-CV-00643-JLS-KSC MOTION TO TRANSFER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29693976_1.docx TABLE OF AUTHORITIES Page(s) Federal Cases Argueta v. Banco Mexicano, 87 F.3d 320 (9th Cir.1996) ...............................................................................6, 8 Atlantic Marine Const. Co. v. U.S. Dist. Court for W. Dist. Of Texas, 134 S. Ct. 568 (2013)...................................................................................passim Bank of America, N.A. v. Miller, 2005 WL 2086099 (E.D. Cal. Aug. 25, 2005) .....................................................4 Batchelder v. Kawamoto, 147 F.3d 915 (9th Cir. 1998) ................................................................................7 Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585 (1991) .........................................................................................7, 8 City of Colton v. American Promotional Events, Inc. West, 614 F.3d 998 (9th Cir. 2010) ................................................................................4 Digital Equipment Corp. v. Desktop Direct, Inc., 511 U.S. 863 (1994) .............................................................................................3 Docksider, Ltd. v. SeaTechnology, Ltd., 875 F.2d 762 (9th Cir. 1989) ..............................................................................13 Instrumentation Assocs., Inc. v. Madsen Elecs. Ltd., 859 F.2d 4 (3d Cir.1988) ......................................................................................3 Jones v. Bock, 549 U.S. 199 (2007) .............................................................................................3 Karl Koch Erecting Co. v. New York Convention Center Dev. Corp. (2d Cir. 1988) 838 F.2d 656 .......................................................................................................12 Lauro Lines s.r.l. v. Chasser, 490 U.S. 495 (1989) .............................................................................................3 M/S Bremen v. Zapata Off–Shore Co., 407 U.S. 1 (1972) .........................................................................................6, 7, 9 Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.34 Page 3 of 20 iii Case No. 17-CV-00643-JLS-KSC MOTION TO TRANSFER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29693976_1.docx MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) .............................................................................................5 Meyer v. Howmedica Osteonics Corp., 2015 WL 728631 (S.D. Cal., February 19, 2015) ..............................................12 Mix v. Neeb (E.D.Cal. 2014) 2014 WL 6469130 ................................................................................................3 Murphy v. Schneider Nat'l, Inc. (9th Cir. 2004) 362 F.3d 1133 .......................................................................................................8 N. California Dist. Council of Laborers v. Pittsburg-Des Moines Steel Co., 69 F.3d 1034 (9th Cir. 1995) .........................13 Paster v. Putney Student Travel, Inc., 1999 WL 1074120 (C.D. Cal. June 9, 1999)........................................................9 Pelleport Investors, Inc. v. Budo Quality Theatres, Inc., 741 F.2d 273 (9th Cir. 1984) ................................................................................7 Rhoades v. Avon Products Inc., 504 F.3d 1151 (9th Cir. 2007) ..........................................................................4, 5 Richards v. Lloyd’s of London, 135 F.3d 1289 (9th Cir.1998) ...............................................................................7 Silva v. Encyclopedia Britannica Inc., 239 F.3d 385 (1st Cir. 2001) ................................................................................3 Simonoff v. Expedia, Inc., 643 F.3d 1202 (9th Cir. 2011) ............................................................................12 Slater v. Energy Services Group Intern., Inc., 634 F.3d 1326 (11th Cir. 2011) ..........................................................................12 Spradlin v. Lear Siegler Mgmt. Servs. Co., 926 F.2d 865 (9th Cir. 1991) ................................................................................9 Verifone, Inc. v. A Cab, LLC (D. Nev. 2016) 2016 WL 44806862016........................................................................................3 Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.35 Page 4 of 20 iv Case No. 17-CV-00643-JLS-KSC MOTION TO TRANSFER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29693976_1.docx Federal Statutes 28 U.S.C. § 1404(a)......................................................................................................passim Federal Rule of Civil Procedure § 12(b)(6).................................................1, 3, 4, 14 FRCP 12(b)(1) ...........................................................................................................4 California Statutes California Business & Professions Code §§ 16600 and 17200 ...........................................................................................12 Labor Code § 203 ...................................................................................................................11 Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.36 Page 5 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION At the outset of his relationship with Defendant ConMed Corporation (“Defendant” or “ConMed”), Plaintiff Chris Klecher (“Plaintiff” or “Klecher”) executed an Offer Letter. That Offer Letter, which Plaintiff attached to his complaint, requires that any claims related to his employment be litigated exclusively in the state or federal courts of Oneida County, New York. Plaintiff also executed an Optionholder Acknowledgment pertaining to his rights and entitlements related to stock options. The Optionholder Acknowledgement requires that any claim related to his stock options be exclusively litigated in any federal or state court located in Delaware. Despite this, Plaintiff filed this action in the United States District Court for the Southern District of California (“Southern District”). This court should reject Plaintiff’s attempt to avoid his pre-dispute forum selection as it is contrary to well-established law. By way of this motion, ConMed seeks to enforce the valid forum selection provisions in the Offer Letter and Optionholder Acknowledgement. Since Plaintiff filed suit in the wrong forum, the Southern District cannot provide any relief related to Plaintiff’s claims. Thus, the matter should be dismissed under Rule 12(b)(6). In the alternative, pursuant to 28 U.S.C. § 1404(a), ConMed seeks transfer of this matter to the appropriate court based on the forum selection provisions – the United States District Court for the Northern District of New York (“Northern District”) for all claims arising out of the Offer Letter and the United States District Court for the District of Delaware (“Delaware District”) for all claims arising out of the Optionholder Acknowledgment. II. STATEMENT OF FACTS ConMed employed Plaintiff pursuant to an Offer Letter dated November 15, 2015 (the “Offer Letter”). (Plaintiff’s Complaint (“Compl.”), ¶ 3; Ex. A to Compl.) Plaintiff’s employment with ConMed arose out of the acquisition of Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.37 Page 6 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx SurgiQuest, Inc., Plaintiff’s prior employer, by ConMed. (Compl., ¶ 8; Ex. A to Compl.) As part of the acquisition, Plaintiff became ConMed’s Vice President of Key Accounts for Advanced Surgical and earned an annual salary of $160,000 with a target bonus of $340,000, for a total potential annual compensation package of $500,000. (Compl., ¶ 3; Ex. A, § 2, 3.) The Offer Letter includes the following forum selection clause: The federal or state courts in Oneida County, New York (including the United States District Court for the Northern District of New York, if and to the extent that it shall have subject matter jurisdiction over any claims) shall have exclusive jurisdiction (and shall be the exclusive forum) in the event of any claim or dispute you may raise or assert arising under or relating to the terms of your employment with and services rendered by you to the Company. (Ex. A, § 7(b).) Plaintiff was also a participant in the “SurgiQuest Amended and Restated 2006 Stock Option Plan” (“Stock Option Plan”). (Compl., ¶ 12.) On December 30, 2015, Plaintiff executed an Optionholder Acknowledgement providing for the conversion of his SurgiQuest, Inc. stock options into payment options upon the acquisition of SurgiQuest, Inc. by ConMed. (Declaration of Daniel S. Jonas (“Jonas Decl.”), ¶ 2; Ex. A to Jonas Decl. at ¶ 2.) In addition to Plaintiff, there were several other employees with SurgiQuest, Inc. stock options who similarly agreed to convert those options into payment options upon the acquisition of SurgiQuest, Inc. by ConMed. (Id.) It was important to ConMed that any disputes about the terms of the stock options be resolved in a single court to avoid the risk of inconsistent judgements. (Id.) Accordingly, the Optionholder Acknowledgment, which was executed by all of these individuals, included a forum selection provision. (Jonas Decl., ¶ 3.) The forum selection clause in the Optionholder Acknowledgment provides: I hereby irrevocably submit to the exclusive jurisdiction of any federal or state court located in the State of Delaware over any dispute arising out of or relating to this Optionholder Acknowledgment or any of the Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.38 Page 7 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx transactions contemplated hereby, and irrevocably agree that all claims in respect of such dispute (whether in contract or tort) or any suit, action proceeding related thereto may be heard and determined in such courts. I hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which I now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. I agree that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. (Ex. A to Jonas Decl. at ¶ 7(b).) Despite acknowledging the validity of the Agreement in his Complaint, Plaintiff nonetheless filed this case in the Southern District. (Compl., ¶¶ 3, 12.) Plaintiff’s Complaint alleges three causes of action: (1) Breach of Contract; (2) Declaratory Relief and (3) Waiting Time Penalties. (Compl.) Each cause of action relates to or arises out of Plaintiff’s employment with ConMed. (Compl., ¶¶16-18, 20-22 and 26-27.) Plaintiff’s complaint also alleges a violation of his rights related to his SurgiQuest, Inc. stock options. (Compl., ¶¶ 12, 18(a).) Plaintiff’s rights related to those options are governed by Optionholder Acknowledgment. (Jonas Decl., ¶ 2; Ex. A to Jonas Decl.) III. LEGAL ARGUMENT A. The Court Should Dismiss This Case Because It Fails To State A Claim Upon Which Relief Can Be Granted A forum selection clause may be enforced pursuant to Rule 12(b)(6). See Silva v. Encyclopedia Britannica Inc., 239 F.3d 385, 387-388 (1st Cir. 2001); Instrumentation Assocs., Inc. v. Madsen Elecs. Ltd., 859 F.2d 4, 6, n. 4 (3d Cir.1988); Mix v. Neeb (E.D.Cal. 2014) 2014 WL 6469130, at *2-3; Verifone, Inc. v. A Cab, LLC (D. Nev. 2016) 2016 WL 44806862016 at *2. “A complaint is subject to dismissal for failure to state a claim if the allegations, taken as true, show the plaintiff is not entitled to relief” such as “when an affirmative defense…appears on its face.” Jones v. Bock, 549 U.S. 199, 215 (2007). Forum selection causes confer a “contractual right to [a particular] forum.” Lauro Lines s.r.l. v. Chasser, 490 U.S. 495, 499 (1989); see also Digital Equipment Corp. Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.39 Page 8 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx v. Desktop Direct, Inc., 511 U.S. 863, 874 (1994). Plaintiff’s complaint reveals a forum selection clause that mandates his employment claims be litigated in New York, not California. (Exhibit A to Complaint.) Moreover, Plaintiff’s complaint seeks relief based on his rights as set forth in the Optionholder Acknowledgment. The Optionholder Acknowledgment mandates that Plaintiff’s claims related to his stock options be litigated in Delaware. Accordingly, this Court cannot grant relief on the complaint. Thus, the complaint “fails to state a claim upon which relief can be granted” and should be dismissed under Rule 12(b)(6). Plaintiff ignored both of the binding forum selection provisions. He improperly filed his employment claims and his stock option claims in a single and improper forum. This complaint should be dismissed so Plaintiff can be held to his prior agreements. Plaintiff must file his claims arising out of the Offer Letter in a court in Oneida County, New York and his claims arising out of the Optionholder Acknowledgment in a state or federal court in Delaware. B. The Court Should Dismiss Plaintiff’s Second Claim for Declaratory Relief Because There is No Case or Controversy Absent a true case or controversy, a claim for declaratory relief must be dismissed for lack of subject matter jurisdiction pursuant to FRCP 12(b)(1). Rhoades v. Avon Products Inc., 504 F.3d 1151, 1157 (9th Cir. 2007). A declaratory judgment case must be “ripe” for judicial determination, meaning that there must be a “substantial controversy” of “sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” City of Colton v. American Promotional Events, Inc. West, 614 F.3d 998, 1004-05 (9th Cir. 2010); Bank of America, N.A. v. Miller, 2005 WL 2086099 at *3 (E.D. Cal. Aug. 25, 2005) (“Because this future event may never happen, prudence requires that this court refrain from adjudicating this premature action.”) Moreover, the federal courts are not charged with rendering advisory opinions. “When presented with a claim for a declaratory judgment, therefore, federal courts Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.40 Page 9 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx must take care to ensure the presence of an actual case or controversy, such that the judgment does not become an unconstitutional advisory opinion.” Rhoades v. Avon Products, Inc., 504 F.3d 1151, 1157 (9th Cir. 2007) (“The disagreement [underlying the declaratory relief action] must not be nebulous or contingent but must have taken on a fixed and final shape so that a court can see what legal issues it is deciding, what effect its decision will have on the adversaries, and some useful purpose to be achieved in deciding them.” (quoting from Pub. Serv. Comm’n v. Wycoff, Co., 344 U.S. 237 (1952)). Specifically, an action for declaratory judgment cannot be brought where the dispute only seeks an “opinion advising what the law would be upon a hypothetical state of facts.” MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007). Here, Plaintiff’s second claim for relief seeks declaratory relief that Paragraphs 5.b and 5.c of the Offer Letter are invalid. These provisions generally restrict Plaintiff from working for a competitor of ConMed or soliciting any employee of ConMed to leave his or her employment during a finite period. (Compl., ¶ ; Ex. A, §§ 5(b),(c). Plaintiff, however, failed to allege that he intends to actually perform any of those actions purportedly restricted by the Offer Letter or that ConMed has taken or threatened any action to enforce the relevant provisions. (See Compl.) Accordingly, no case or controversy is alleged or exists. Absent a case or controversy with respect to the relevant paragraphs, the Court lacks subject matter jurisdiction over Plaintiff’s second claim for relief and it should be dismissed with prejudice. See Rhoades, 504 F.3d at 1157. C. In the Alternative, The Court Should Transfer This Case to the Proper Court Pursuant To 28 U.S.C. § 1404(a). Parties may designate a forum in which litigation is to take place by contract. Litigation commenced elsewhere is subject to a motion to transfer venue under 28 U.S.C. § 1404(a) if the contractually designated forum is another federal court. Atlantic Marine Const. Co. v. U.S. Dist. Court for W. Dist. Of Texas, 134 S. Ct. 568, Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.41 Page 10 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 6 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx 580 (2013). “When the parties have contracted in advance to litigate disputes in a particular forum, courts should not unnecessarily disrupt the parties’ settled expectations.” Id. at 583. “[A] valid forum-selection clause should be given controlling weight in all but the most exceptional cases.” Id. at 581 (internal citations and quotation marks omitted). Where the parties have agreed to litigate disputes in a particular forum, the forum selection clause controls “absent a strong showing that it should be set aside.” M/S Bremen v. Zapata Off–Shore Co., 407 U.S. 1, 10 (1972). Forum selection clauses are presumptively valid and a party challenging them bears a heavy burden of proof to show that “enforcement would be unreasonable and unjust, or that the clause was invalid for such reasons as fraud or overreaching.” Id. at 15; see also Argueta v. Banco Mexicano, 87 F.3d 320, 325 (9th Cir.1996) (forum selection clauses are “prima facie valid and should not be set aside unless the party challenging the enforcement of such a provision can show it is ‘unreasonable’ under the circumstances.”). “In a typical case not involving a forum-selection clause, a district court considering a § 1404(a) motion (or a forum non conveniens motion) must evaluate both the convenience of the parties and various public-interest considerations.” Atlantic Marine, 134 S. Ct. at 581. The presence of a valid forum selection clause, as is present here, requires district courts to adjust their usual Section 1404(a) analysis. Id. First, the plaintiff’s choice of forum merits no weight, and instead, the plaintiff “bears the burden of establishing that transfer to the forum for which the parties bargained is unwarranted.” Id. at 581-82. Second, the Court should not consider arguments about the parties’ private interests. Id. at 582. Finally, when “a party bound by a forum-selection clause flouts its contractual obligation and files suit in a different forum, a § 1404(a) transfer of venue will not carry with it the original venue’s choice-of-law rules.” Id. at 582. Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.42 Page 11 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx 1. The Forum Selection Clauses are Valid and Enforceable Forum selection clauses are presumptively valid and should be honored “absent some compelling and countervailing reason.” Bremen, 407 U.S. at 12. Plaintiff bears a “heavy burden of proof” and must “clearly show” the reasons the clause is unenforceable. Id. at 15; see also Pelleport Investors, Inc. v. Budo Quality Theatres, Inc., 741 F.2d 273, 280 (9th Cir. 1984). A forum selection clause is only unenforceable: (1) if the inclusion of the clause in the agreement was the product of fraud or overreaching; (2) if the party wishing to repudiate the clause would effectively be deprived of his day in court were the clause enforced; and (3) if enforcement would contravene a strong public policy of the forum in which suit is brought. Richards v. Lloyd’s of London, 135 F.3d 1289, 1294 (9th Cir.1998), citing and quoting Bremen, 407 U.S. at 12-13, 15, 18) (internal quotations omitted). (a) Neither Forum Selection Clause Was the Product of Fraud or Overreaching Plaintiff makes no allegations of fraud related to either forum selection clause. Indeed, he makes no allegations related to the Optionholder Acknowledgment forum selection clause. Even assuming the same allegations applied to the Optionholder Acknowledgment, it is still valid for the same reasons discussed below. Moreover, the Offer Letter was not overreaching. The best Plaintiff can do is allege that the Offer Letter was an adhesion contract, he only had a few days to sign it and he was unable to consult his own legal counsel. (Compl., ¶ 7(d)(iii),(iv).) These allegations, even if true, do not render the forum selectin provision unenforceable. Absent more, that the forum selection clause is found in an adhesion contract is immaterial. Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 593-595, (1991) (rejecting the idea that enforcing a forum selection clause in a non-negotiable cruise ticket was unreasonable); see also Batchelder v. Kawamoto, 147 F.3d 915, 919 (9th Cir. 1998). Moreover, unequal or disparate bargaining power does not render a forum Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.43 Page 12 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 8 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx selection clause unenforceable. Shute, 499 U.S. at 595; Murphy v. Schneider Nat'l, Inc. (9th Cir. 2004) 362 F.3d 1133, 1141 (“a differential in power or education on a non-negotiated contract will not vitiate a forum selection clause.”). Murphy is instructive. There, Plaintiff claimed the forum selection clause was overreaching because “of power differential and non-negotiability.” Id. at 1141. Specifically, the plaintiff submitted an affidavit claiming his employment contract was non- negotiable, he was told if he wanted the job he had to accept the contract as is and he only had a tenth grade education. Id. This was insufficient “to overcome the strong presumption in favor of enforcing forum selection clauses.” Id. Regardless, any claim that Plaintiff was an unsophisticated party and there was unequal bargaining power is itself overreaching. Plaintiff’s complaint makes clear that Plaintiff was a sophisticated party. Prior to the Offer Letter, he was the Vice President of Sales at SurgiQuest and came on board at ConMed as the Vice President of Key Accounts for Advanced Surgical with a potential annual salary of $500,000. (Compl., ¶ 8; Ex. A, § 1.) Plaintiff was more than capable of reviewing the Offer Letter and requesting potential revisions. He simply failed to do so. Indeed, Plaintiff fails to allege any effort on his part to negotiate any provision in the Offer Letter, including the forum selection clause. (See Compl.) He cannot now be heard to claim that ConMed somehow rejected any attempts at negotiation, which he never even attempted. (b) Enforcing the Forum Selection Clauses Will Not Deprive Plaintiff His Day in Court A party objecting to the enforcement of a forum selection clause on the ground that the agreed-to forum is unreasonable must meet the “heavy burden of showing that trial in the chosen forum would be so difficult and inconvenient that the party would effectively be denied a meaningful day in court.” Argueta v. Banco Mexico, S.A., 87 F.3d 320, 325 (9th Cir. 1996), quoting Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273, 281 (9th Cir. 1984). Courts routinely reject the Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.44 Page 13 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 9 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx notion that the expense or inconvenience of prosecuting an action in the designated forum rises to the level of depriving one’s day in court. “Courts recognize that accepting typical arguments about expense and inconvenience would nullify the advantages of forum selection clauses.” Paster v. Putney Student Travel, Inc., 1999 WL 1074120, at *3 (C.D. Cal. June 9, 1999). Thus, any inconvenience Plaintiff may experience, if any at all, in travelling to New York or Delaware, is insufficient to overcome the strong legal presumption in favor of enforcing an agreed upon forum selection clause. See, e.g., Spradlin v. Lear Siegler Mgmt. Servs. Co., 926 F.2d 865, 869 (9th Cir. 1991) (enforcing forum selection clause designating Saudi Arabia as forum for suit even though the plaintiff was located in the United States). Plaintiff cannot show litigating the matter in New York or Delaware would “be so manifestly and gravely inconvenient to [him] that [he] will effectively be deprived of a meaningful day in court.” Bremen, 407 U.S. at 19. This is particularly true where Plaintiff specifically consented to personal jurisdiction of the courts in those states. Enforcing the mandatory forum selection clause will not deprive Plaintiff from any meaningful day in court. All that Plaintiff alleges is that ConMed knew he resided in California and that ConMed does business in California. These facts are legally irrelevant. They do not demonstrate any excessive burden on Plaintiff that would preclude him from having his day in court. Moreover, Plaintiff’s private interests in litigating in a more convenient forum cannot be considered by the Court in deciding whether to enforce the forum selection provision. Atlantic Marine, 134 S. Ct. at 582. When Plaintiff voluntarily signed the Employment Agreement and Optionholder Acknowledgement, which contained the forum selection provisions, he effectively exercised “venue privilege” before this dispute arose. Id. at 581-82. Only those initial choices deserve deference and Plaintiff must bear the burden of showing why the court should not transfer the case to the forum to which the parties Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.45 Page 14 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx agreed. Id. at 582. As such, Plaintiffs’ choice to sue in this Court merits no weight in the transfer analysis under section 1404(a). Id. at 582. Rather, the only choice that deserves any merit is Plaintiff’s pre-litigation selection of venue in New York and Delaware. (c) Enforcing the Contract Forum Selection Clauses Will Not Violate California Public Policy “As the party acting in violation of the forum-selection clause, [Plaintiff] must bear the burden of showing that public-interest factors overwhelmingly disfavor a transfer.” Id. at 583 (emphasis added). Nonetheless, “[b]ecause public-interest factors will rarely defeat a transfer motion, the practical result is that forum-selection clauses should control except in unusual cases.” Id. at 574. Plaintiff cannot meet his heavy burden to show that the public interest factors overwhelmingly disfavor enforcement of the mandatory forum selection clauses. Public interest factors that the Court can consider include, “the administrative difficulties flowing from court congestion; the ‘local interest in having localized controversies decided at home’; the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action; the avoidance of unnecessary problems in conflict of laws, or in the application of foreign law; and the unfairness of burdening citizens in an unrelated forum with jury duty.” Id. at 583. Plaintiff has not alleged or presented any evidence that any of these factors defeat transfer. Indeed, if anything, the factors actually support transfer. In addition to the forum selection clauses, the Offer Letter also included a valid choice of law provision, which requires that all claims “shall be governed by, and construed exclusively in accordance with, the laws of the State of New York.” (Compl., Ex. A, § 7(a).) The Optionholder Acknowledgement similarly contained a choice of law provision providing that Delaware law governs all claims. (Ex. A to Jonas Decl. at ¶ 7(a).) Any experience by the Southern District in applying New York or Delaware Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.46 Page 15 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx law, is undoubtedly minimal in comparison to the Northern District of New York and the courts of Delaware, respectively. Accordingly, transfer of the applicable claims to the proper courts is appropriate so that the court with the most familiarity with the applicable law may oversee this matter.1 Failing to enforce the Delaware forum selection clause related to Plaintiff’s stock option claims risks inconsistent judgments. (Jonas Decl., ¶ 3.) Several individuals entered into the same agreement. Id. The forum selection clause was meant, in part, to ensure that any claims by these multiple individuals would be heard in a single forum under the same law. Id. If the forum selection clause is not enforced, there could be multiple actions in multiple forums, each potentially applying their own law. This risk of inconsistent judgments is not warranted especially given Plaintiff’s election to bring suit in Delaware. Moreover, no public policy requires or even supports the notion that Plaintiff’s claims should be litigated in California. This is not a case where Plaintiff’s complaint is founded on unique or fundamental California law or policy. Rather, the thrust of Plaintiff’s claim is an alleged breach of contract. Any court is able to adequately address Plaintiff’s claims, including the Northern District of New York. It is true Plaintiff alleges a violation of a California wage and hour law (Labor Code § 203) related to the timeliness of his final wages. However, it is equally true that New York law more than adequately protects Plaintiff’s interests related to this issue. Plaintiff concedes as much when he alternatively alleged a violation of a New York statute that provides for the same type of relief, and likely greater relief, related 1 Because there is a valid forum selection clause that required Plaintiff to bring his claims in New York and Delaware, respectively, California law will not apply upon transfer to the proper court. As the Supreme Court noted in Atlantic Marine, “[t]he court in the contractually selected venue should not apply the law of the transferor venue to which the parties waived their right.” Atlantic Marine, 134 S.Ct. at 583. But even if California law or the law of another state applied, this factor would still weigh in favor of transfer. Id. at 584 (“And, in any event, federal judges routinely apply the law of a State other than the State in which they sit. We are not aware of any exceptionally arcane features of Texas contract law that are likely to defy comprehension by a federal judge sitting in Virginia.”). Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.47 Page 16 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx to the payment of final wages. (Compl., ¶ 28.) Even assuming California law were to be applied to all of Plaintiff’s claims, a federal district court in New York or Delaware is fully capable of applying that law, if appropriate.2 Moreover, a federal district court in New York or Delaware would apply the same Federal Rules of Civil Procedure applicable in this Court. Plaintiff cannot show that it would contravene California’s public policy to litigate his claims in a New York or Delaware forum applying the same procedural rules that would apply in this Court. Plaintiff’s final attempt to defeat transfer is to allege that the Offer Letter forum selection provision is non-mutual. This has no impact on the enforceability of forum selection provision and should not be considered. Karl Koch Erecting Co. v. New York Convention Center Dev. Corp. (2d Cir. 1988) 838 F.2d 656, 660 (upholding allegedly non-mutual forum selection provision.). 2. The Forum Selection Clauses Apply To This Action Federal courts apply federal law when interpreting a contractual forum selection clause. See Simonoff v. Expedia, Inc., 643 F.3d 1202, 1205 (9th Cir. 2011). The Offer Letter provides that the “federal or state courts in Oneida County, New York” has exclusive jurisdiction and are the exclusive forum “in the event of any claim or dispute you may raise or assert arising under or relating to the terms of your employment with and services rendered by you to the Company.” (Ex. A to Compl. at § 7(b).) A provision selecting a forum for all claims “relating to” the terms of employment as set forth in an employment agreement encompasses all claims arising out of the employment relationship. See Slater v. Energy Services Group Intern., 2 Even in disputes involving purported restrictive covenant provisions alleged to be void under California law, courts have upheld forum selection clauses and transferred the actions. See e.g., Meyer v. Howmedica Osteonics Corp., 2015 WL 728631 (S.D. Cal., February 19, 2015) (granting motion to transfer claims for declaratory relief under California Business & Professions Code sections 16600 and 17200 to New Jersey pursuant to 28 U.S.C. § 1404(a) based on a forum selection clause in an employment contract with restrictive covenants). Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.48 Page 17 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 13 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx Inc., 634 F.3d 1326, 1330-31 (11th Cir. 2011). Here, Plaintiff’s claims necessarily arise from his employment relationship with ConMed, bringing them within the scope of the Offer Letter’s forum selection clause. The Optionholder Acknowledgement similarly provides that “any dispute arising out of or relating to this Optionholder Acknowledgment or any of the transactions contemplated thereby” must be litigated in Delaware. (Ex. A to Jonas Decl. at ¶ 7(a).) Plaintiff specifically alleges he was not compensated for his stock options and seeks recovery based thereon. The Optionholder Acknowledgment unquestionably encompasses that claim and the applicable forum selection clause unquestionably applies. 3. The Forum Selection Clauses Are Mandatory, Not Permissive Where the term “venue” is used with mandatory language, the court designated in the forum selection clause is the only appropriate forum. Docksider, Ltd. v. SeaTechnology, Ltd., 875 F.2d 762, 764 (9th Cir. 1989) (holding mandatory language that “venue shall be deemed to be in Virginia” makes clear that venue lies exclusively in Virginia and all actions must be filed and prosecuted there). “To be mandatory, a clause must contain language that clearly designates a forum as the exclusive one.” N. California Dist. Council of Laborers v. Pittsburg-Des Moines Steel Co., 69 F.3d 1034, 1037 (9th Cir. 1995). The Offer Letter forum selection clause includes mandatory language related to the proper forum. It provides that Oneida County New York “shall have exclusive jurisdiction (and shall be the exclusive forum).” (Ex. A to Compl. at § 7(b).) Similarly, the Optionholder Acknowledgement includes mandatory language and provides for “exclusive jurisdiction.” (Ex. A to Jonas Decl. at ¶ 7(b).) This language leaves no doubt that the forum is mandatory and must be enforced. / / / / / / / / / Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.49 Page 18 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 14 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx IV. CONCLUSION For all the foregoing reasons, ConMed Corporation respectfully requests that this Court enforce the forum selection clauses to which Plaintiff voluntarily agreed and dismiss this case pursuant to Federal Rule of Civil Procedure section 12(b)(6). In the alternative, ConMed Corporation respectfully requests that the Court transfer Plaintiff’s claims arising out of the Offer Letter to the United States District Court for the Northern District of New York and Plaintiff’s claims arising out of the Optionholder Acknowledgment to the United States District Court for the District of Delaware. DATED: May 22, 2017 OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. By: /s/ Mark F. Lovell Rafael G. Nendel-Flores Mark F. Lovell Attorneys for Defendant CONMED CORPORATION Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.50 Page 19 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 15 Case No. 17-CV-00643-JLS-KSC MOTION TO DISMISS, OR THE ALTERNATIVE, TO TRANSFERVENUE PURSUANT TO 28 U.S.C. § 1404(A) 29693976_1.docx PROOF OF SERVICE Klecher v. Conmed Corporation, et al. Case No. 17-cv-00613-JLS-KSC I am and was at all times herein mentioned over the age of 18 years and not a party to the action in which this service is made. At all times herein mentioned I have been employed in the County of Orange in the office of a member of the bar of this court at whose direction the service was made. My business address is Park Tower, Suite 1500, 695 Town Center Drive, Costa Mesa, CA 92626. On May 22, 2017, I served the following document(s): MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS PURSUANT TO FRCP 12(B)6); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) by placing (the original) (a true copy thereof) in a sealed envelope addressed as stated on the attached service list. Jay R. Strauss David C. Winton WINTON STRAUSS LAW GROUP, P.C. 2 Ranch Drive Novato, CA 94945 Telephone: (415) 265-5555 Facsimile: (415) 265-985-2112 jrs@wintonstrauss.com dcw@wintonstrauss.com Attorneys for Plaintiff, CHRIS KLECHER BY ECF: with the Clerk of the United States District Court of Southern District of California, using the CM/ECF System. The Court’s CM/ECF System will send an e-mail notification of the foregoing filing to the following parties and counsel of record who are registered with the Court’s CM/ECF System: (Federal): I declare that I am employed in the office of a member of the State Bar of this Court at whose direction the service was made. I declare under penalty of perjury under the laws of the United States of America that the above is true and correct. Executed on May 22, 2017, at Costa Mesa, CA. Diane Vo Type or Print Name Signature 29693976.1 Case 3:17-cv-00643-JLS-KSC Document 7-1 Filed 05/22/17 PageID.51 Page 20 of 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 17-CV-00643-JLS-KSC DECLARATION OF DANIEL S. JONAS 29811057_1.docx Rafael G. Nendel-Flores CA Bar No. 223358 rafael.nendelflores@ogletree.com Mark F. Lovell CA Bar No. 246652 mark.lovell@ogletree.com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Park Tower, Fifteenth Floor 695 Town Center Drive Costa Mesa, CA 92626 Telephone: 714.800.7900 Facsimile: 714.754.1298 Attorneys for Defendant CONMED CORPORATION UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA CHRIS KLECHER Plaintiff, v. CONMED CORPORATION Defendant. Case No. 17-CV-00643-JLS-KSC DECLARATION OF DANIEL S. JONAS IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS PURSUANT TO FRCP 12(B)6); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) [Concurrently filed with Notice of Motion and Motion to Dismiss; Memorandum of Points and Authorities; [Proposed] Order] Date: July 6, 2017 Time: 1:30 p.m. Place: 4D Complaint Filed: March 29, 2017 Trial Date: None Judge: Hon. Janis L. Sammartino Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.52 Page 1 of 10 Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.53 Page 2 of 10 Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.54 Page 3 of 10 Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.55 Page 4 of 10 Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.56 Page 5 of 10 OPTIONHOLDER ACKNOWLEDGMENT * * * TO BE COMPLETED BY OPTIONHOLDER * * * As a holder of the Company Options set forth on Schedule A, I hereby acknowledge and agree with the following: 1. Accuracy of Options Listing. I acknowledge that the information concerning my Company Options contained in Schedule A is accurate. 2. Treatment of Company Options. I understand and agree that, in accordance with the Merger Agreement: (a) at the Effective Time, each of my Company Options will be automatically cancelled and converted into a right to receive a payment equal to a portion of the Merger Consideration; (b) my portion of the Merger Consideration will be based on the Merger Consideration applicable to a Common Share minus the exercise price of the Company Option; (c) the Merger Consideration applicable to Company Options that are vested as of the Closing including certain Company Options for which the Company has determined to accelerate vesting as of the Closing will be paid promptly (but no later than five (5) business days) after the Effective Time; (d) the Merger Consideration applicable to Company Options that are unvested as of the Closing will generally be paid, subject to my continued employment by the Company or Conmed through the payment date, on or about December 30, 2016, (with earlier payment if my employment is terminated by the Company or Conmed without “Cause” or by me with “Good Reason”, each as defined in the Company’s Amended & Restated 2006 Stock Plan); (e) as a holder of Company Options, I may become entitled to receive certain additional contingent cash payments determined in accordance with the Merger Agreement and described below. 3. Payments and Escrow. I understand that, under the Merger Agreement, certain amounts (the “Reserve Amounts”) have been deducted from the Merger Consideration in respect of the Company’s indemnity obligations and liabilities as well as possible purchase price adjustments (in each case as calculated pursuant to the Merger Agreement). The amount of any indemnification claims and liability that may be satisfied from the Reserve Amounts cannot readily be determined as of the Closing, and it is uncertain what portion, if any, of the Reserve Amounts may become payable to the Holders. The Reserve Amounts will be maintained in special accounts (the “Escrow Accounts”), and after the satisfaction of any indemnity obligations and liabilities and the any applicable purchase price adjustments will be distributed to the Holders in accordance with the terms of the Merger Agreement. Accordingly, I understand that I will be entitled to receive for each share represented by my Company Options, a share of distributions made upon release of the Reserve Amounts from the Escrow Accounts, if any, in accordance with the Merger Agreement, as well as pro rata distribution of any such amounts in respect of unvested Company Options that may be forfeited by other Holders after the Closing, payable at the time such amounts become payable to other Holders in accordance with the terms of the Merger Agreement. Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.57 Page 6 of 10 4. Taxes. I understand and agree that all payments to me in respect of Merger Consideration (including any payment of my share, if any, of the Reserve Amounts) will be subject to tax withholding under applicable federal, state, local or foreign law. 5. Holder Representative - Power of Attorney. I understand that, as discussed above, I will have the right to receive certain payments (in cash) at Closing and may become entitled to additional payments of the Reserve Amounts from the Escrow Accounts. I also understand that, as there are numerous persons entitled to such rights, the Holder Representative has been appointed by the current stockholders of the Company and empowered to receive payments and notices on behalf of the entire group and to represent the Holders with respect to claims for indemnification and liabilities. Accordingly, I hereby irrevocably designate and appoint, as agent and attorney-in-fact, the Holder Representative, to act for and on behalf of me with authority including, but not limited to, the authority to (a) give and receive notices and communications, (b) dispute or fail to dispute any claim for indemnification pursuant to Merger Agreement (c) agree to, negotiate and enter into settlements and compromises of, and comply with orders and decrees with respect to, any dispute or liability, and to take all actions necessary or appropriate in the judgment of the Holder Representative for the accomplishment of the foregoing. A decision, act, consent or instruction of the Holder Representative with respect to the Merger Agreement shall constitute a decision of me and shall be final, binding and conclusive upon me. 6. Release; Assignment. (a) I acknowledge and agree on behalf of myself and each of my beneficiaries, successors and assigns (each a “Releasing Party” and together the “Releasing Parties”) that each hereby waives, releases and forever discharges the Company and its agents, shareholders, employees, directors, officers, branches, affiliates, subsidiaries, creditors, successors (including Conmed and its affiliates) and assigns (each a “Released Party” and together the “Released Parties”) from any and all damages, losses, claims, demands, liabilities, obligations, actions and causes of action whatsoever (each a “Claim” and together the “Claims”) that any of the Releasing Parties may have or claim to have against any of the Released Parties arising from my outstanding Company Options (including the cancellation thereof), in each case whether currently known or unknown or with respect to which the facts are known that could give rise to or support a Claim and of every nature and extent whatsoever, including all such losses or damages of any kind heretofore sustained or that may arise as a consequence of the dealings between me and the Company up to the date hereof, other than Claims for (1) payment of cash in respect of my Company Options in accordance with the terms of the Merger Agreement and (2) indemnification that I may have pursuant to the Merger Agreement. (b) Except as set forth below, I further agree and covenant, on behalf of each Releasing Party, that I (or it) has not heretofore assigned, and shall not hereafter sue any Released Party upon, any Claim released or purported to be released under Section 6(a), and each Releasing Party shall indemnify and hold harmless Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.58 Page 7 of 10 the Released Parties against any loss or liability on account of any actions brought by such Releasing Party or its assigns or prosecuted on behalf of such Releasing Party and relating to any Claim released or purported to be released under Section 6(a). Each Releasing Party agrees to transfer and assign any and all rights under the Claims to Conmed and Conmed acquires from each Releasing Party all rights and interest under the Claims. 7. Governing Law; Jurisdiction. (a) This Optionholder Acknowledgment shall be governed by the internal Laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (of the State of Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware. (b) I hereby irrevocably submit to the exclusive jurisdiction of any federal or state court located in the State of Delaware over any dispute arising out of or relating to this Optionholder Acknowledgment or any of the transactions contemplated hereby, and irrevocably agree that all claims in respect of such dispute (whether in contract or tort) or any suit, action proceeding related thereto may be heard and determined in such courts. I hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which I now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute. I agree that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. (c) I hereby consent to process being served by the Company or Conmed or any of their respective affiliates in any suit, action or proceeding by delivery of a copy thereof in accordance with the provisions of the Merger Agreement. 8. Contingent on Closing. Notwithstanding anything herein to the contrary, the cancellation of my Company Options, any entitlement to payment under the Merger Agreement and any release provided for in this Optionholder Acknowledgment shall be conditional upon the consummation of the Merger such that, in the event the Merger is not consummated and the Merger Agreement is terminated, my Company Options shall in all respects revert to the terms in effect prior to the business day immediately prior to the Closing and remain in full force and effect. [Signature page follows] Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.59 Page 8 of 10 Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.60 Page 9 of 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2 Case No. 17-CV-00643-JLS-KSC DECLARATION OF DANIEL S. JONAS 29811057_1.docx PROOF OF SERVICE Klecher v. Conmed Corporation, et al. Case No. 17-cv-00613-JLS-KSC I am and was at all times herein mentioned over the age of 18 years and not a party to the action in which this service is made. At all times herein mentioned I have been employed in the County of Orange in the office of a member of the bar of this court at whose direction the service was made. My business address is Park Tower, Suite 1500, 695 Town Center Drive, Costa Mesa, CA 92626. On May 22, 2017, I served the following document(s): DECLARATION OF DANIEL S. JONAS IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS PURSUANT TO FRCP 12(B)6); MOTION TO DISMISS PURSUANT TO FRCP 12(B)(1), OR IN THE ALTERNATIVE, TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(A) by placing (the original) (a true copy thereof) in a sealed envelope addressed as stated on the attached service list. Jay R. Strauss David C. Winton WINTON STRAUSS LAW GROUP, P.C. 2 Ranch Drive Novato, CA 94945 Telephone: (415) 265-5555 Facsimile: (415) 265-985-2112 jrs@wintonstrauss.com dcw@wintonstrauss.com Attorneys for Plaintiff, CHRIS KLECHER BY ECF: with the Clerk of the United States District Court of Southern District of California, using the CM/ECF System. The Court’s CM/ECF System will send an e-mail notification of the foregoing filing to the following parties and counsel of record who are registered with the Court’s CM/ECF System: (Federal): I declare that I am employed in the office of a member of the State Bar of this Court at whose direction the service was made. I declare under penalty of perjury under the laws of the United States of America that the above is true and correct. Executed on May 22, 2017, at Costa Mesa, CA. Diane Vo Type or Print Name Signature Case 3:17-cv-00643-JLS-KSC Document 7-2 Filed 05/22/17 PageID.61 Page 10 of 10