Claudio-De León v. Sistema Universitario Ana G. Méndez
775 F.3d 41
| 1st Cir. | 2014Background
- Rosana Claudio was employed under fixed-term contracts with SUAGM; the last two extensions contained a mandatory forum-selection clause requiring disputes be submitted to the Court of First Instance of Puerto Rico, San Juan Part.
- Claudio alleges pregnancy, sex, and marital discrimination and hostile work environment stemming from her relationship with a colleague; she complained to multiple SUAGM administrators between Dec. 2009 and Apr. 2010 and was notified her contract would not be renewed in June 2010.
- Claudio filed an EEOC charge (June 2010) and received a right-to-sue notice; Appellants filed in Puerto Rico court (July 2010) and later in federal district court (Jan. 2011) asserting Title VII and supplemental state-law claims.
- Defendants moved to dismiss raising forum-selection clause enforcement for the first time in Dec. 2011; the district court granted dismissal under Rule 12(b)(6) in May 2012 but did not specify whether dismissal was with or without prejudice.
- On appeal, Appellants argued (1) the clause was not triggered because constructive good-faith negotiations never occurred, (2) defendants waived the clause by delaying its invocation, and (3) any dismissal based on the clause should be without prejudice.
- The First Circuit held the clause was mandatory, applicable to the claims, not waived, and enforceable, but modified the dismissal to be without prejudice to permit refiling in the agreed forum.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the forum-selection clause was triggered by a failure to engage in pre-filing "constructive negotiations conducted in good faith" | Claudio: No triggering occurred because parties never engaged in such negotiations before filing | Defendants: Clause is mandatory and covers "any dispute"; pre-filing negotiations standard is satisfied by meetings Claudio had with administrators | Held: Clause is mandatory and applies; plaintiffs failed to carry the heavy burden to show the condition precedent was unmet, and meetings alleged could constitute constructive negotiations |
| Whether defendants waived the forum-selection clause by waiting to raise it | Claudio: Defendants litigated in federal court for months and thus waived the right to enforce the clause | Defendants: Motion to enforce forum clause may be raised any time before disposition on the merits; no waiver occurred | Held: No waiver; a motion to dismiss based on a forum-selection clause can be raised before disposition on the merits and was timely here |
| Whether the clause is unenforceable as unreasonable or unjust | Claudio: Enforcement would be unjust given delay, discovery, and resources spent in federal court | Defendants: Clause is prima facie valid; plaintiffs bear heavy burden to show unreasonableness | Held: Plaintiffs made no showing of fraud, extreme inconvenience, or public-policy conflict; enforcement is not unreasonable |
| Whether dismissal should be with or without prejudice | Claudio: If dismissal required, it should be without prejudice so claims can be refiled in state forum | Defendants: Sought dismissal without prejudice in their motion | Held: Dismissal should be without prejudice; appellate court modifies judgment to permit re-filing in the Court of First Instance, San Juan Part |
Key Cases Cited
- M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972) (party resisting enforcement bears heavy burden to show clause unreasonable)
- Atlantic Marine Constr. Co. v. U.S. Dist. Ct., 134 S. Ct. 568 (2013) (forum-selection clauses should be enforced by transfer or forum non conveniens; discussed enforcement mechanisms)
- Rivera v. Centro Médico de Turabo, Inc., 575 F.3d 10 (1st Cir. 2009) (analysis of permissive vs. mandatory forum-selection clauses and Rule 12(b)(6) review)
- Rafael Rodríguez Barril, Inc. v. Conbraco Indus., Inc., 619 F.3d 90 (1st Cir. 2010) (clause-specific scope analysis; presumption of enforceability)
- Silva v. Encyclopedia Britannica, Inc., 239 F.3d 385 (1st Cir. 2001) (motion to dismiss based on forum-selection clause may be raised at various stages)
- United States ex rel. Karvelas v. Melrose-Wakefield Hosp., 360 F.3d 220 (1st Cir. 2004) (presumption that Rule 12(b)(6) dismissal is with prejudice absent clear statement)