MEMORANDUM
Presently before the Court is the Motion to Dismiss of Defendants Pieter Johannis Leendert Okkerse, Wayne Blanchard, Frank Powers, and Bobby Hampton (ECF No. 25). For the following reasons, the Motion will be denied.
I. BACKGROUND
A. Procedural Background
On August 30, 2013, Plaintiff, SKF USA, Inc. (“SKF”), filed this lawsuit against Defendants, Pieter Johannis Leendert Okkerse, Wayne Blanchard, Frank Powers, and Bobby Hampton. (Compl., ECF No. 1.) On the same day, Plaintiff filed a Motion for Preliminary Injunction (ECF No. 3), a Motion for Hearing on the Motion for Preliminary Injunction (ECF No. 8), a Motion for Expedited Discovery (ECF No. 5), and a Motion to Preserve Evidence (ECF No. 7). Plaintiffs three-count Complaint alleges that Defendants violated a valid and enforceable non-competition agreement. (Compl.) Counts One and Two allege breach of contract and tortious interference with contract against all Defendants. (Id.) Count Three alleges tortious interference with prospective and/or contractual relations against Defendant Okkerse. (Id.)
On September 27, 2013, Defendants filed the instant Motion to Dismiss. (Defs.’ Mot., ECF No. 25.) Defendants’ Motion challenges personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2) and venue under Rule 12(b)(3). (Id.) De
B. Factual History
Plaintiff is a Delaware corporation that provides a wide array of products and technology to a diverse industrial customer base. (Compl. ¶¶ 3, 11, 12.) Plaintiff employs thousands of employees in multiple states and maintains a principal place of business in Lansdale, Pennsylvania. (Id. at ¶ 3; St. Pierre Decl. ¶ 8, Pl.’s Resp. Ex. A.) On or about December 27, 2012, Plaintiff merged with its affiliate Machine Support USA Inc. (“Machine Support”). SKF was the surviving entity. (Compl.)
Defendants are former employees of Machine Support and SKF.
Sometime prior to terminating their employment with Plaintiff, Defendants had signed Employee Confidentiality and Non-competition Agreements (“Agreements”). (Id. at ¶ 18 & Exs. A, B, C, D.) The Agreements, which apply post termination, contain a choice of law provision stating that they are governed by “the substantive laws of the Commonwealth of Pennsylvania without reference to the choice of law provisions of Illinois or any other state.” (Id at ¶ 11 & EXs. A, B, C, D.) The Agreements further state that “[a]ny disputes arising under this Agreement shall be tried in the courts sitting within the Commonwealth of Pennsylvania, and Employee hereby consents and submits his or her person to the jurisdiction of any such court for any such purpose.” (Id.) In addition, the Agreements stipulate that “([b]y executing this Agreement, Employee expressly represents that he or she had read it, understands its terms and has had the opportunity (whether exercised or not) to consult with legal counsel regarding it”) (Id at ¶ 14 & Exs. A, B, C, D.)
II. DISCUSSION
A. Defendants’ Motion to Dismiss for Lack of Personal Jurisdiction
Defendants argue that Plaintiffs Complaint should be dismissed because this Court lacks personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). (Defs.’ Mot. 10.) Defendants’ argument is based on the assertion that the forum selection clause — “the sole potential basis for specific jurisdiction” — in this ease is invalid. (Id.) More specifically, Defendants argue that Louisiana law, which generally prohibits choice of law, forum selection, non-competition, and non-solicitation clauses, should govern this action. (Id at 12.) In the alternative, Defendants argue that the forum selection clause is not enforceable under Pennsylvania law. (Id at 14-15.)
Plaintiff counters that the choice of law provision contained within the Agreements is valid and that under Pennsylvania law the forum selection clause should be upheld. (Pl.’s Resp. 8.) We address the choice of law question first since it is a primary basis upon which the parties’ arguments are based.
1. Choice of Law
It is well established that “[a] federal court exercising diversity jurisdiction must apply the choice of law rules of the forum state.” Kruzits v. Okuma Mach. Tool, Inc.,
unless either (a) the chosen state has no substantial relationship to the parties or the transaction and there is no reasonable basis for the parties’ choice, or (b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue
Id (citing Schifano v. Schifano,
Defendants assert that we should apply Louisiana law because Pennsylvania does not have a substantial relationship to the parties or the transaction. (Defs.’ Mot. 11.) We disagree. It is well settled that when a corporation has a principal place of business within a state, that state bears a substantial relationship to the parties. Kruzits,
ii. Section 187(2)(b)
Section 187(2) (b) of the Restatement requires a two part inquiry. First, we must determine whether Louisiana has a materially greater interest in this case than Pennsylvania. Coface Collections N. Am. v. Newton,
Courts have differing views as to what is necessary to demonstrate a “materially greater interest.” The Court of Appeals for the Fourth Circuit and the Court of Appeals for the Eighth Circuit have held that the state in which an individual lives and works has a materially greater interest in the determination of an issue than the state in which a corporate litigant conducts business. Barnes Grp., Inc. v. C & C Prods., Inc.,
Similarly, the Court of Appeals for the Seventh Circuit and the Court of Appeals for the Tenth Circuit have held that a party’s incorporation within a state, standing alone, is an insufficient basis upon which to uphold a choice of law clause. For example, in Curtis 1000, Inc. v. Suess, the defendant was incorporated in the state of Delaware and headquartered in Georgia.
Conversely, the Third Circuit has upheld choice of law provisions applying the law of the state in which a party is incorporated
Courts in the Third Circuit have also noted that a company’s connection to a state is greater when it is headquartered there. In Synthes, Inc. v. Emerge Med., Inc., the plaintiff, a Pennsylvania corporation with employees located in multiple states, sought enforcement of a choice of law provision applying Pennsylvania law. No. 11-1566,
Similarly, in Britton v. Whittmanhart, Inc., a Delaware corporation headquartered in Illinois sought enforcement of a choice of law provision designating Illinois law. No. 09-1593,
Defendants have failed to establish that Louisiana’s interest in this case is materially greater than Pennsylvania’s. It is not enough to assert that Louisiana has a greater interest simply because application of Pennsylvania law runs contrary to a fundamental Louisiana policy. Moreover, the fact that Defendants may live in Louisiana, work in Louisiana, or signed their Agreements in Louisiana does not necessarily establish that Louisiana has a materially greater interest than Pennsylvania. In focusing upon Louisiana’s prohibition on choice of law, forum selection, non-competition, and non-solicitation agreements, Defendants have failed to address the interest that Pennsylvania has in this case.
Pennsylvania has an interest in enforcing a voluntarily negotiated contract that explicitly designates the application of Pennsylvania law. This interest stems, at least in part, from the recognition that uniformity of contract serves a strong public policy. See Hopkins v. GNC Franchising, Inc., No. 05-1510,
We cannot say that Louisiana’s interest in this case is materially greater than Pennsylvania’s. This is not a case where both parties are citizens of Louisiana. Plaintiff is a national company with thousands of employees located in multiple states. Moreover, the choice of law clause at issue here designates the law of the state in which Plaintiff maintains a principle place of business. Indeed, Plaintiffs Lansdale, Pennsylvania office provides Machine Support with payroll services, human resources services, and legal services to its many employees. We are satisfied that Louisiana does not have a materially greater interest in this case than does Pennsylvania.
A Personal Jurisdiction
Having determined that Pennsylvania law governs this case, it is necessary to
Pennsylvania’s long-arm statute allows a court to exercise jurisdiction over a nonresident defendant “to the fullest extent allowed under the Constitution of the United States and may be based upon the most minimum contact with this Commonwealth allowed under the Constitution of the United States.” 42 Pa. Cons.Stat. Ann. § 5322(b); see also Time Share Vacation Club v. Atl. Resorts, Ltd,.,
Personal jurisdiction may be exercised under the theory of general jurisdiction or under the theory of specific jurisdiction. General jurisdiction may be exercised over a non-resident defendant when the defendant has “continuous and systematic” contacts with the forum state. Id. at 317,
Specific jurisdiction may be exercised over a non-resident defendant when the “claim is related to or arises out of the defendant’s contacts with the forum.” IMO Indus., Inc. v. Kiekert AG,
Defendants assert that this Court lacks general jurisdiction because Plaintiffs Complaint fails to plead “continuous or systematic” contacts between Defendants and Pennsylvania. (Defs.’ Mot. 17.) Further, Defendants argue that general jurisdiction is lacking because none of the Defendants “reside in Pennsylvania; work in Pennsylvania; have any bank accounts in Pennsylvania; own any property in Pennsylvania; or could be served with process in Pennsylvania.” (Id.) Plaintiff counters that Defendants’ focus on minimum contacts is misplaced given the fact that Defendants signed a valid forum selection clause. (PL’s Resp. 11-12.)
We have previously recognized that a defendant may consent to personal jurisdiction and venue through the execution of a valid forum selection clause. PNC Bank, Nat. Ass’n. v. Kanaan, No. 11-7770,
3. Forum Selection Clause
Forum selection clauses are “prima facie valid” and should be enforced unless shown to be “unreasonable’ under the circumstances.” M/S Bremen,
unless the party objecting to its enforcement establishes (1) that it is the result of fraud or overreaching, (2) that enforcement would violate a strong public policy of the forum, or (3) that enforcement would in the particular circumstances of the case result in litigation ina jurisdiction so seriously inconvenient as to be unreasonable.
Coastal Steel Corp. v. Tilghman Wheelabrator Ltd.,
i. Fraud or Overreaching
Defendants do not assert that the forum selection clause was the result of fraud. Rather, Defendants argue that it was the result of overreaching because its sole purpose was the avoidance of unfavorable Louisiana law. (Defs.’ Mot. 14-15.) Defendants contend that Plaintiff was aware of Louisiana’s prohibition on forum selection, non-competition, and non-solicitation agreements and chose Pennsylvania law in an effort to circumvent this ban. (Id. at 15.) Defendants further assert that the Agreements were not freely negotiated because Defendants did not have an opportunity to consult with legal counsel prior to signing them. Id. Defendants’ arguments are unpersuasive.
Defendants have failed to point to any evidence supporting their allegation that the forum selection clause was included in order to defeat unfavorable Louisiana law. Plaintiff, on the other hand, has offered a compelling reason for choosing Pennsylvania law. .As discussed above, Plaintiff maintains a principal place of business in Pennsylvania. It is from this location that Plaintiff provides support to its employees who are located throughout the country. It is reasonable to conclude that Plaintiff selected Pennsylvania law in order to ensure the uniform treatment of its employees. Furthermore, by signing the Agreements, Defendants acknowledged that they knew that they “had the opportunity (whether exercised or not) to consult with legal counsel____” (Compl. ¶ 14 & Exs. A, B, C, D.) The failure of Defendants to recognize the existence of a forum selection clause does not give rise to an inference of fraud or overreaching. Campanini v. Studsvik, Inc., No. 08-5910,
ii. Inconvenience
Defendants argue that enforcement of the forum selection clause would “greatly inconvenience defendants and third party witnesses in this case.” (Defs.’ Mot. 14.) Defendants assert that having to travel from Louisiana and/or Alabama to Pennsylvania would result in a personal and financial hardship. Id. Defendants also assert that litigation in Pennsylvania would require the transportation of third party witnesses and documentation, which are “believed to be located in Louisiana.” Id.
Defendants’ argument regarding financial hardship does not establish that the forum selection clause is unreasonable or that Defendants will be deprived of their day in court. Campanini,
As we observed in Kanaan, the exercise of personal jurisdiction over a defendant, whether general or specific, must comport with “traditional notions of fair play and substantial justice,” such that the parties can “reasonably anticipate being haled into court [in this forum].”
B. Defendant’s Motion to Dismiss for Improper Venue
Defendants ask this Court to dismiss this action for improper venue, and/or transfer this action to the Eastern District of Louisiana for the convenience of the parties and witnesses. (Defs.’ Mot. 19.)
1. Improper Venue
Rule 12(b)(3) allows a party to dismiss an action for improper venue. Fed.R.Civ.P. 12(b)(3). The movant bears the burden of establishing improper venue. Myers v. Am. Dental Ass’n.,
(b) A civil action may be brought in (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated; or (3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court’s personal jurisdiction with respect to such action.
28 U.S.C. § 1391(b). This venue statute does not require that a court determine the “best” forum, Cottman Transmission Sys., Inc. v. Martino,
Although venue may be proper in Louisiana as Defendants suggest, it is clear that venue is also proper in this District in light of the forum selection clause and our determination that Defendants are subject to personal jurisdiction here. Quinn v. Worldwide Comm’ns, Inc., No. 10-1512,
2. Defendants’ Motion to Transfer Venue
Even though venue is proper in this District, this action may nevertheless be transferred to another venue pursuant to 28 U.S.C. § 1404(a), which provides that “[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.” 28 U.S.C. § 1404(a); Lempke v. Gen. Elec., Co., Nos. 10-5380, 10-5426,
The Third Circuit has compiled a list of factors that bear on motions to transfer venue. These factors fall into two categories: private interests and public interests. Jumara,
[E]nforceability of the judgment; practical considerations that could make the trial easy, expeditious, or inexpensive; the relative administrative difficulty in the two fora resulting from court congestion; the local interest in deciding local controversies at home; the public policies of the fora; and the familiarity of the trial judge with the applicable state law in diversity cases.
Id. at 879-80 (citations omitted). Not all factors will apply in a given ease, and the court may address other considerations if pertinent. The statute demands an “individualized, case-by-case consideration of convenience and fairness.” Van Dusen v. Barrack,
The United States Supreme Court recently clarified that the analysis for considering a section 1404(a) motion differs “when the parties’ contract contains a valid forum-selection clause, which ‘represents the parties’ agreement as to the most proper forum.’ ” Atl. Marine Constr. Co., Inc. v. U.S. Dist. Ct. W. Dist. of Tex., — U.S.-,
When parties agree to a forum-selection clause, they waive the right to challenge the preselected forum as inconvenient or less convenient for themselves or their witnesses, or for their pursuit of the litigation. A court accordingly must deem the private-interest factors to weigh entirely in favor of the preselected forum. As we have explained in a different but instructive context whatever inconvenience the parties would suffer by being forced to litigate in the contractual forum as they agreed to do was clearly foreseeable at the time of contracting.
Id. at 582 (citations and internal quotations omitted). Here, Paragraph 11 of the Agreements states that “[a]ny disputes arising under this Agreement shall be tried in the courts sitting within the Commonwealth of Pennsylvania, and Employee
Defendants’ Motion fails to address any of the public interest factors. Our review of the record fails to reveal any reason why it would be more difficult to enforce a judgment in this case in the Eastern District of Pennsylvania than it would be if the case were decided in the Eastern District of Louisiana. Furthermore, the trial judge’s familiarity with the applicable state law weighs in favor of Plaintiff, since the Agreements include a choice of law provision applying Pennsylvania law. These factors favor denial of Defendants’ motion to transfer venue. See De Lage Landen Fin. Servs., Inc.,
C. Defendants’ Motion to Dismiss for Failure to State a Claim
Federal Rule of Civil Procedure 12(b)(6) provides that a complaint can be dismissed for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). When evaluating a Rule 12(b)(6) motion “courts [must] accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.” Fowler v. UPMC Shadyside,
In order to survive a motion to dismiss “a complaint must contain sufficient factual matter, accepted as true, ‘to state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal,
Defendants argue that Counts One, Two, and Three should be dismissed because the noncompetition and non-solicitation provisions of the Agreements are unenforceable under Pennsylvania law.
1. Consideration
In order for a non-competition agreement to be enforced under Pennsylvania law it must “be supported by adequate consideration.” Insulation Corp. of Am. v. Brobston,
Defendants assert that they signed the Agreements after the commencement of their employment and did not receive any new consideration, change in benefits, or change in employment status. (Declarations, Defs.’ Mot. Exs. A, B, C.) In making this argument, Defendants rely upon declarations attached to their Motion. However, we are not at a stage in the proceedings where such proofs may be considered. See Victaulic,
2. Reasonably Necessary
Defendants contend that the Agreements are unreasonable because Plaintiff makes no allegation that Defendants received special skills or training from Plaintiff during their employment. (Defs.’ Mot. 26.) Defendants also assert that the non-competition and/or nonsolicitation provisions in the Agreement are unrelated to the protection of confidential or proprietary information because there are separate provisions in the Agreements directly addressing the disclosure of such information. (Id.) Finally, Defendants contend that the noncompetition and non-solicitation clauses are not necessary to protect Plaintiffs good will because Plaintiff is a large company, and “any good will that [Plaintiff] may have with its shipping and/or ship building customers would be de minimims.” (Id. at 26-27.) We are not convinced.
Plaintiffs Complaint alleges that its business operates on intellectual property and trade secrets, “including but not limited to methods of doing business; proprietary products and equipment; valuation methods; computer programs and data bases; business ideas; billing procedures; pricing and commission data; customer lists; and any other customer data.” (Compl. ¶ 29.) Among other things, Plaintiff uses these trade secrets to “retain and service customers, secure new customers ... and to establish a competitive edge.” (Id. at ¶ 32.) The Complaint also states that Defendants were required to sign the Agreements in order to protect the confidentiality of such information. (Id. at 31.)
Contrary to Defendants’ argument, it is not necessary for an employee to receive specialized training or skills in order for a restrictive covenant to be enforced. Girard Inv. Co. v. Bello,
Plaintiffs Complaint asserts that it relies upon its trade secrets to “retain and service customers, secure new customers ... and establish a competitive edge.” (Compl. ¶ 32.) The Complaint further asserts that Defendants, who were required to sign non-competition agreements in order to protect Plaintiffs trade secrets, are using this information to di
3. Geographic Limitation
Defendants assert that the Agreements are “unenforceable on their face” because they contain no geographic limitation. (Defs.’ Mot. 26.) We disagree. In order to be enforceable, a covenant not to compete must be reasonably limited in geographic extent. Hess,
It is not possible, based solely upon the pleadings, to determine whether the geographic scope in this case is reasonable. Plaintiffs Complaint does not state, with any specificity, the states in which it conducts business, nor does it provide any indication as to the geographic scope of the Defendants’ duties.
III. CONCLUSION
For the foregoing reasons, the Motion to Dismiss of Defendants Pieter Johannis Leendert Okkerse, Wayne Blanchard, Frank Powers, and Bobby Hampton will be denied.
An appropriate Order follows.
AND NOW, this 15th day of January 2014, upon consideration of the Motion to Dismiss of Defendants Pieter Johannis Leendert Okkerse, Wayne Blanchard, Frank Powers, and Bobby Hampton (ECF No. 25), it is ORDERED that the Motion is DENIED.
IT IS SO ORDERED.
Notes
.We view all of the facts and draw all reasonable inferences therefrom in the light most favorable to Plaintiff, the non-moving party. See Pinker v. Roche Holdings Ltd.,
. Following the merger, Machine Support became SKF Marine Industry Service Center, but is still commonly known in the industry as Machine Support. (Pl.’s Resp. 4.)
. Defendants were all employed in various positions by Machine Support until January 2013. Following the merger between Machine Support and SKF in December 2012, Defendants became employed directly by SKF. (Compl. ¶ 4-7.)
. Since Defendants failed to establish a materially greater interest, it is unnecessary to determine whether application of Pennsylvania law runs contrary to a fundamental public policy of Louisiana. Nevertheless, we note that it is unclear whether "the high threshold for establishing such a fundamental policy ... would be met here.” Coface,
. Pennsylvania's long-arm statute provides for specific jurisdiction when the cause of action arises from a defendant's business transactions within the Commonwealth. 42 Pa. Cons.Stat. Ann. § 5322(a)(1). Specifically, the statute states that:
A tribunal of this Commonwealth may exercise personal jurisdiction over a person (orthe personal representative of a deceased individual who would be subject to jurisdiction under this subsection if not deceased) who acts directly or by an agent, as to a cause of action or other matter arising from such person:
(1) Transacting any business in this Commonwealth. Without excluding other acts which may constitute transacting business in this Commonwealth, any of the following shall constitute transacting business for the purpose of this paragraph:
(i)The doing by any person in this Commonwealth of a series of similar acts for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object.
(ii) The doing of a single act in this Commonwealth for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object with the intention of initiating a series of such acts.
(iii) The shipping of merchandise directly or indirectly into or through this Commonwealth.
(iv) The engaging in any business or profession within this Commonwealth, whether or not such business requires license or approval by any government unit of this Commonwealth.
(v) The ownership, use or possession of any real property situate within this Commonwealth.
42 Pa. Cons.Stat. Ann. §§ 5322(a)(1)(i)-(v).
. We also note that the use of video conferencing, videotape depositions for trial, and the internet are commonplace in litigation today.
. Since we have general jurisdiction over Defendants, we need not engage in a specific jurisdiction analysis. See, e.g., InfoMC, Inc. v. Comprehensive Behavioral Care, Inc., No. 10-4907,
. Plaintiff argues that we should apply Pennsylvania law to Counts Two and Three because Pennsylvania courts routinely apply contractual choice of law clauses to related
Here, the Agreements state that “[a]ny disputes arising under this Agreement shall be tried in the courts sitting within the Commonwealth of Pennsylvania ....” (Comp. ¶ 11 & Exs. A, B, C, D.) This language is sufficiently broad to embrace Plaintiff's tort claims in Counts II and III. Compare CentiMark,
. When ruling on a 12(b)(6) motion courts must consider only “the allegations in the complaint, ... documents that are attached[,] ... matters incorporated by reference or integral to the claim, items subject to judicial notice, matters of public record, orders, and items appearing in the record of the case.” Siwulec v. J.M. Adjustment Servs., LLC,
. Plaintiffs Complaint states that Machine Support provides services "around the globe.” However, the word “global” “gives no useful indication of exactly where [the plaintiffs] products are actually sold for comparison against the scope of [the defendants] work.” Victaulic,
