Villanueva v. Barcroft
2011 U.S. Dist. LEXIS 113764
N.D. Ohio2011Background
- Villanueva sues York, Marsh, and Barcroft in the ND Ohio asserting ten causes of action arising from an alleged investment scheme tied to a 500k CMO program.
- Barcroft approached Villanueva in Jan 2010; they jointly contribute 250k each to meet the program’s minimum; a Profit Agreement was formed between Villanueva and Barcroft, separate from York.
- The Profit Agreement references an Escrow Agreement with York as Escrow Agent; funds were wired to York to purchase a CMO; a Non-Performance Clause promised a return if trading did not commence.
- Villanueva alleges the Escrow and Profit Agreements authorize York to handle funds; Barcroft and Marsh allegedly orchestrated the scheme; York allegedly forged his signature on the Escrow Agreement.
- York moves to dismiss for lack of personal jurisdiction, improper venue, or transfer; Villanueva moves for partial summary judgment and Marsh default; the court ultimately dismisses York without prejudice due to a forum selection clause.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the forum selection clause valid and enforceable? | Villanueva argues clause is ambiguous and unenforceable. | York argues clause is valid and binding Michigan forum. | Forum clause is valid and enforceable. |
| Does the forum selection clause apply to all of Villanueva's claims? | All claims arise from the Profit Agreement and are within the clause. | Clause covers disputes arising under related agreements. | Clause applies to all of Villanueva's claims. |
| Can York invoke the forum selection clause as a non-signatory? | Lack of signatory status prevents enforcement against York. | Equitable estoppel allows a non-signatory to invoke the clause when closely related. | York may invoke the forum selection clause via equitable estoppel. |
| Is York subject to personal jurisdiction in Ohio based on the facts? | Ohio long-arm jurisdiction over York due to participation in scheme. | No sufficient minimum contacts; forum clause controls venue. | Personal jurisdiction threshold not met; clause governs venue. |
| Should the case be dismissed or transferred given the forum clause? | Dismissal would bar Villanueva from pursuing in Michigan only; transfer could be appropriate. | Clause warrants dismissal or transfer to Michigan. | York's motion granted; case dismissed without prejudice; venue shifted to Michigan for refiling. |
Key Cases Cited
- Wong v. PartyGaming, Ltd., 589 F.3d 821 (6th Cir. 2009) (forum selection clause factors; enforceability standard)
- Liles v. Ginn-La West End, Ltd., 631 F.3d 1242 (11th Cir. 2011) (equitable estoppel extends to non-signatories for forum clauses)
- MS Dealer Serv. Corp. v. Franklin, 177 F.3d 942 (6th Cir. 1999) (equitable estoppel/arbitration clause analogy)
- Baker v. LeBoeuf, Lamb, Leiby & Macrae, 105 F.3d 1102 (6th Cir. 1997) (foreseeability and incorporation in estoppel analysis)
- Arnold v. Arnold Corp.-Printed Communications For Bus., 920 F.2d 1269 (6th Cir. 1990) (fraud in inducement vs. contract terms; forum clause validity)