Kebb Management, Inc. v. Home Depot U.S.A., Inc.
59 F. Supp. 3d 283
D. Mass.2014Background
- Kebb Management, a Massachusetts corporation, performed maintenance under a Master Service Agreement (MSA) with Home Depot (Delaware corp., principal place Atlanta).
- The MSA required Home Depot to issue work orders governed by the MSA; from 2010–May 2013 parties performed without dispute.
- In 2013 Kebb submitted a $110,500 concrete-flooring quote for Home Depot’s Watertown, MA store, uploaded it to a specified work-order number, completed the work, and invoiced Home Depot, which refused payment.
- Home Depot contends the specific work order was never approved and the work was unauthorized; Kebb contends Home Depot approved and later refused payment and that Home Depot declined to agree on mediation logistics.
- The MSA contains two forum-selection clauses: Article 17 (Georgia law; Georgia courts have exclusive jurisdiction) and Article 18 (mandatory mediation first, then suits in the Northern District of Georgia or Cobb County Superior Court).
- Kebb sued in Massachusetts state court; Home Depot removed based on diversity and moved to dismiss or, alternatively, to transfer under 28 U.S.C. § 1404(a). The district court allowed the transfer to the Northern District of Georgia.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability of forum-selection clause | Clause is ambiguous, not mandatory; enforcement would be unreasonable and deny Kebb its day in court | MSA unambiguously mandates Georgia courts; clause bargained-for and enforceable | Court enforced clause; language is mandatory when Articles 17 and 18 read together |
| Effect of defendant’s alleged breach/mediation refusal on forum clause | Home Depot’s refusal to agree on mediation and alleged breach excuse compliance with forum/mediation provisions | Breach or failure to agree on mediation does not void forum-selection clause; plaintiff still bound | Court rejected excuse; mediation failure did not invalidate clause |
| Proper procedural vehicle to enforce clause | (Plaintiff did not contest procedural vehicle) | Defendant sought dismissal under Rule 12(b)(6) or transfer under § 1404(a) | Court followed Atlantic Marine and transferred under § 1404(a) rather than dismissing |
| Consideration of private convenience and plaintiff’s forum choice | Forum choice should weigh against transfer; private hardship makes enforcement unreasonable | Atlantic Marine precludes weighting plaintiff’s choice or private interests when clause valid | Court gave no weight to plaintiff’s forum choice or private-interest arguments and found no public-interest bar to transfer |
Key Cases Cited
- Atl. Marine Constr. Co. v. U.S. Dist. Court for W. Dist. of Texas, 134 S. Ct. 568 (U.S. 2013) (forum-selection clauses control § 1404(a) analysis; plaintiff’s forum choice and private-interest factors are displaced)
- M/S Bremen v. Zapata OffShore Co., 407 U.S. 1 (U.S. 1972) (forum clauses are prima facie valid; heavy burden to set aside)
- Rivera v. Centro Medico de Turabo, Inc., 575 F.3d 10 (1st Cir. 2009) (First Circuit precedent on enforcing forum-selection clauses)
- Silva v. Encyclopedia Britannica Inc., 239 F.3d 385 (1st Cir. 2001) (forum-selection clauses carry strong presumption; exclusive jurisdiction language is mandatory)
- Lambert v. Kysar, 983 F.2d 1110 (1st Cir. 1993) (forum-selection clause enforcement via Rule 12(b)(6) in First Circuit)
- Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (U.S. 1947) (traditional § 1404(a) factors and presumption favoring plaintiff’s forum)
- Saturn Mgmt. LLC v. GEM-Atreus Advisors, LLC, 754 F. Supp. 2d 272 (D. Mass. 2010) ("exclusive jurisdiction" language construed as mandatory)