Ruff v. Strategic Contract Brands Inc
6:15-cv-05004
D.S.C.Aug 12, 2016Background
- Kristine M. Ruff, a South Carolina resident, worked for Strategic Contract Brands, Inc. (Texas corp.) as National Sales Manager under a January 3, 2014 Employment Agreement paying salary plus commissions.
- Employment Agreement contained a Texas choice-of-law clause and a forum-selection clause requiring venue in Dallas County, Texas.
- Ruff alleges repeated unilateral changes to her commission structure, broken promises by executives, and termination on October 2, 2015; she filed suit in South Carolina alleging SCPWA violations, breach of contract, wrongful discharge (public policy), promissory estoppel, equitable accounting, and fraud.
- Defendant filed a separate suit in Dallas and invoked the Employment Agreement’s forum clause; the Northern District of Texas had enforced the clause in related litigation.
- Defendant moved in South Carolina to dismiss for lack of personal jurisdiction or, alternatively, to transfer under 28 U.S.C. § 1404(a). The Court denied dismissal and the transfer motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction (specific) | Ruff: Sufficient purposeful contacts — recruitment of a SC resident, mailing and signing of the Employment Agreement in SC, home office/equipment in SC, sales in SC, termination letter sent to SC — invoking § 36‑2‑803 | Strategic: Contacts are insubstantial (few SC sales, no advertising/property/employees in SC); registration to do business is insufficient; claims concern commissions not linked to SC | Court: Found specific jurisdiction — contract to be performed in part in SC (§ 36‑2‑803(7)), purposeful availment, claims arise from the contract, and jurisdiction is reasonable |
| Enforceability of forum-selection clause | Ruff: Clause invalid/unreasonable — not arm’s-length (added after employment began), adhesive in employer‑employee context, grave practical inconvenience (financial hardship, inability to litigate in Texas), and enforcement would bar SC statutory/public-policy claims | Strategic: Clause is valid and should be enforced; no extraordinary circumstances to deny enforcement | Court: Clause not prima facie valid here (adhesive context) and enforcement would be gravely inconvenient / unfair (limits SC statutory/public‑policy claims); clause unenforceable |
| Transfer under 28 U.S.C. § 1404(a) | Ruff: Plaintiff’s choice of forum entitled to deference; transfer would be inequitable and burdensome | Strategic: Move to transfer based on forum clause and convenience; offered no detailed § 1404(a) balancing | Court: Denied transfer — defendant failed to show balance of convenience favors Texas; plaintiff’s forum choice stands |
Key Cases Cited
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts standard for due process)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (purposeful availment and contacts assessment)
- Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102 (reasonableness factors in jurisdiction analysis)
- M/S Bremen v. Zapata Off–Shore Co., 407 U.S. 1 (forum‑selection clauses prima facie valid; defenses to enforcement)
- Atlantic Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas, 571 U.S. 49 (forum‑selection clause enforcement and transfer analysis)