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CBS Boring & Machine Co. Inc. v. Eisenwerk Bruhl Gmbh

United States District Court, E.D. Michigan, Southern Division

April 2, 2019

CBS Boring & Machine Co., Inc., Plaintiff,
Eisenwerk Bruhl GmbH, Defendant.

          David R. Grand, U.S. Magistrate Judge



         This case arises from a contract dispute between a seller of automotive engine cylinder blocks, Eisenwerk Brühl, and a machining services company, CBS Boring. In an April 19, 2016 purchase agreement, Brühl contracted with CBS to precision-machine the Brühl cylinder blocks before their delivery to GM. Brühl agreed to make CBS its sole supplier of the machining services for a minimum of five years. Following a breakdown in negotiations on bracket-pricing, however, the purchase agreement was terminated.

         Plaintiff filed suit in Macomb County Circuit Court on May 14, 2018, and, on November 20, 2018, Defendant removed the case to federal court. [Dkt. # 1]. On November 27, 2018, Defendant filed a motion to dismiss [5], citing the doctrine of forum non conveniens, which requires a Court to dismiss a case without prejudice if a foreign court presents a more appropriate forum. That motion is now fully briefed. The Court now finds the motions suitable for determination without a hearing in accord with Local Rule 7.1(f)(2).

         Legal Standard

         The principles of forum non conveniens are outlined in Atlantic Marine Construction Company v. United States District Court for the Western District of Texas, 571 U.S. 49 (2013). Since Atlantic Marine was decided, district courts in the Sixth Circuit have considered motions to enforce a forum-selection clause under both Rule 12(b)(6) and under the doctrine of forum non conveniens. Transp. Sys., LLC v. Amazon, 2018 U.S. Dist. LEXIS 178044, *5-6 (E.D. Mich. Oct. 17, 2018). As both parties have argued under the latter standard, the Court will consider the tenets of forum non conveniens to constitute the standard of review.

         Courts evaluate a forum non conveniens motion for dismissal in the same way they would evaluate a motion for transfer under 28 U.S.C. § 1404(a). Atlantic Marine, 571 U.S. at 62. That statute reads,

(a) For 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 or to any district or division to which all parties have consented.

28 U.S.C. § 1404(a).

         “[B]oth § 1404(a) and the forum non conveniens doctrine from which it derives entail the same balancing-of-interests standard.” Atlantic Marine, 571 U.S. at 61. These factors include both the convenience of the parties and various public-interest considerations, as outlined in Piper Aircraft v. Reyno, 454 U.S. 235 (1981). A Court should generally weigh ease of access to sources of proof, availability of compulsory process for unwilling witnesses, and cost of obtaining the attendance of willing witnesses. Piper Aircraft, 454 U.S. at 235. It should also consider the administrative difficulties that flow from court congestion, the local interest in having localized controversies decided at home, and the interest in having the trial of a diversity case in a forum that is at home with the law. Id. Courts must also give proper weight to Plaintiff's choice of forum. Id.

         The calculus changes, however, if the contract governing the dispute includes a valid forum-selection clause. Atlantic Marine, 454 U.S. at 63. The “enforcement of valid forum-selection clauses, bargained for by the parties, protects their legitimate expectations and furthers vital interests of the justice system.” Id., quoting Stewart Organizations, Inc. v. Ricoh Corp., 487 U.S. 22, 33 (1988) (Kennedy, J. concurring).

         Atlantic Marine provides that a valid forum-selection clause forces district court judges to adjust their § 1404(a) analysis in three ways, which, as a practical matter, requires such clauses to be given weight in “all but the most exceptional cases. Atlantic Marine, 571 U.S. at 63. First, Plaintiff's choice of forum merits no weight. Id. Second, the court should not consider arguments about the parties' private interests. Id. at 63-64. “As a consequence, a district court may consider arguments about public-interest factors only.” Id. at 64. Third, although generally a defendant that succeeds in transferring a case from one state to another will be stuck with the choice-of-law rules of the transferor court's state (a narrow exception to the Klaxon Rule), the choice-of-law rules of a transferor court will not follow the case to a transferee court if there is a valid forum-selection clause. Id. at 64-65.

         Forum-selection clauses, for their own part, are interpreted not according to state contract law, but according to federal common law rules of contract interpretation. Wong v. Partygaming, Ltd., 589 F.3d 821, 828 (6th Cir. 2009). Federal common law interprets forum-selection clauses with ordinary ...

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