Krist v. Pearson Education, Inc.
263 F. Supp. 3d 509
E.D. Pa.2017Background
- Photographer Bob Krist sued Pearson Education for copyright infringement, alleging 359 infringements based on Pearson’s use of his photographs.
- Only 7 claims involve licenses Krist issued directly to Pearson; 352 claims involve photographs Krist licensed to Corbis, which sublicensed to Pearson under Pearson–Corbis agreements.
- Pearson moved to transfer venue to the Southern District of New York under 28 U.S.C. § 1404(a), invoking a forum-selection clause in the Pearson–Corbis contracts which states disputes shall be litigated in New York.
- Krist was not a signatory to the Pearson–Corbis agreements and asserted only federal copyright claims, not contract claims against Pearson or Corbis.
- Pearson argued Krist should be bound by the forum clause because (1) the suit is based on licensed uses under those contracts, (2) Krist is a beneficiary/closely related to the contracts, and (3) Corbis acted as Krist’s agent when entering the contracts.
- The court denied transfer, finding the forum-selection clause not enforceable against Krist and that Section 1404(a) factors did not favor transfer absent a valid clause binding the plaintiff.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a forum-selection clause in contracts to which the plaintiff is not a party can support transfer under § 1404(a) | Krist: clause does not bind a nonparty who brings federal copyright claims and did not agree to the clause | Pearson: clause applies because the claims “regard” the contracts and Krist is effectively bound as beneficiary/agent/closely related party | Court: Clause not enforceable against Krist; Atlantic Marine presumption of transfer does not apply absent a contract between the parties |
| Whether Krist’s copyright claims “regard” the Pearson–Corbis contracts such that clause should bind him | Krist: copyright claim is independent and he did not assert contractual rights | Pearson: case necessarily involves interpreting the Pearson–Corbis licenses, so clause applies | Court: While contracts will be relevant, relevance alone does not bind a nonsignatory to a forum clause |
| Whether Krist is a third-party beneficiary or closely related to the Pearson–Corbis contracts | Krist: not a party and did not sue as a beneficiary of those contracts | Pearson: Krist benefitted from Corbis licenses and is closely related/beneficiary, so clause should bind him | Court: Cases enforcing clauses against nonsignatories involved contract/fraud/tort claims; here Krist brought only copyright claims, so beneficiary/relatedness exceptions do not apply |
| Whether Corbis acted as Krist’s agent such that Pearson–Corbis clause binds Krist | Krist: Corbis agreements did not reserve control to Krist; no continuous direction or control exists | Pearson: Corbis had authority to sublicense and thus bound Krist as principal | Court: Corbis was not Krist’s agent for general contracting: agreements gave Corbis broad discretion and only limited agency for settlements/collections; no general principal–agent relationship existed |
Key Cases Cited
- Piper Aircraft Co. v. Reyno, 454 U.S. 235 (plaintiff’s forum choice should rarely be disturbed)
- Atl. Marine Constr. Co. v. United States Dist. Court, 571 U.S. 49 (forum-selection clause ordinarily enforced; shifts transfer analysis)
- Jumara v. State Farm Ins. Co., 55 F.3d 873 (3d Cir.) (§ 1404(a) private/public interest factors)
- John Wyeth & Bros., Ltd. v. CIGNA Int’l Corp., 119 F.3d 1070 (3d Cir.) (scope of forum-selection clause is a matter of contract interpretation)
- Crescent Int’l, Inc. v. Avatar Cmtys., Inc., 857 F.2d 943 (3d Cir.) (claims arising out of contractual relation implicated clause analysis)
- Coastal Steel Corp. v. Tilghman Wheelabrator Ltd., 709 F.2d 190 (3d Cir.) (exceptions binding nonsignatories in certain contexts)
- Hatco Corp. v. W.R. Grace & Co.-Conn., 59 F.3d 400 (3d Cir.) (ambiguities in New York contracts construed against drafter)