Intrastate Distributors, Inc. v. ALANI NUTRITION, LLC, 5:21-cv-10369

Plaintiff Intrastate Distributors, Inc. (IDI), a Michigan corporation, and defendant Alani Nutrition, LLC, a Kentucky company, entered a three‑year exclusive Michigan distribution agreement on June 1, 2020.
IDI alleges Alani wrongfully terminated the distribution agreement before the contract term ended; IDI sued in Michigan state court and Alani removed to federal court based on diversity jurisdiction.
The agreement contains a choice‑of‑law clause (“This Agreement shall be construed under, and governed by, the laws of the State of Kentucky”) and a forum clause (“jurisdiction and venue for any legal proceedings arising from or in any way connected to this Agreement will lie in the State of Kentucky, and both parties hereby submit and consent to the jurisdiction and venue of said courts”).
Alani moved to dismiss or alternatively to transfer the case to the Western District of Kentucky, arguing the forum clause mandates Kentucky venue; IDI argued the clause is permissive and that Michigan is the proper forum under the §1404 analysis.
The magistrate judge concluded the forum clause is unambiguously permissive (not exclusive) and therefore denied Alani’s motion to dismiss; she also denied the alternative motion to transfer under 28 U.S.C. §1404, finding IDI’s forum choice and the balance of convenience/public‑interest factors did not strongly favor transfer.

Issue	Plaintiff's Argument	Defendant's Argument	Held
1. Is the forum‑selection clause mandatory or permissive?	The clause is permissive: wording “will lie in” and juxtaposition with the contract’s use of the mandatory “shall be” for choice of law shows parties knew how to use mandatory language.	The clause is mandatory: “will lie in” plus agreement that parties “submit and consent” indicate exclusivity to Kentucky.	Clause is permissive (allows Kentucky as a proper forum but does not bar suit elsewhere).
2. Does Atlantic Marine’s altered transfer analysis apply?	Because the clause is permissive, Atlantic Marine’s framework (which neutralizes plaintiff’s forum choice and shifts burden) does not apply.	Alani contended Atlantic Marine should affect the §1404 analysis regardless.	Atlantic Marine applies only to mandatory clauses; plaintiff’s forum choice retains significant weight.
3. Should the case be transferred under 28 U.S.C. §1404(a)?	Michigan is convenient: operative facts center on Michigan distribution and alleged breaches occurred in Michigan; plaintiff’s chosen forum merits strong deference.	Kentucky is appropriate given the contract’s choice‑of‑law clause and forum provision.	Transfer denied: choice‑of‑law favors Kentucky but is not controlling; overall factors do not strongly favor transfer.

Smith v. Aegon Cos. Pension Plan, 769 F.3d 922 (6th Cir.) (courts may dismiss under Rule 12(b)(6) or transfer under §1404 when a forum clause is implicated)
Atlantic Marine Constr. Co. v. U.S. Dist. Court for W. Dist. of Tex., 571 U.S. 49 (2013) (when a contract requires litigation only in a specified forum, plaintiff’s forum choice is entitled to no weight and public‑interest factors remain)
Wong v. PartyGaming Ltd., 589 F.3d 821 (6th Cir.) (federal law governs enforceability of forum‑selection clauses)
M/S Bremen v. Zapata Off‑Shore Co., 407 U.S. 1 (1972) (forum‑selection clause enforceability principles)
Docksider, Ltd. v. Sea Tech., Ltd., 875 F.2d 762 (9th Cir.) (illustrative use of mandatory language in forum clauses)
BAE Sys. Tech. Sols. & Servs., Inc. v. Republic of Korea’s Def. Acquisition Program Admin., 884 F.3d 463 (4th Cir.) (Atlantic Marine‘s modified analysis applies only where the forum clause is mandatory)