Judge: Katherine Chilton, Case: 22STLC07939, Date: 2023-04-04 Tentative Ruling
Case Number: 22STLC07939 Hearing Date: April 4, 2023 Dept: 25
PROCEEDINGS: MOTION
TO DISMISS FOR IMPROPER VENUE
MOVING PARTY: Defendant
Stars North, LLC
RESP. PARTY: Plaintiff Kyle Johnson
MOTION TO DISMISS FOR IMPROPER VENUE
(CCP §§ 410.30, 418.10)
TENTATIVE RULING:
Defendant Stars North, LLC’s Motion to
Dismiss for Improper Venue is GRANTED.
SERVICE:
[X] Proof of Service Timely Filed
(CRC, rule 3.1300) OK
[X] Correct Address (CCP §§ 1013,
1013a) OK
[X] 16/21 Court Days Lapsed (CCP §§
12c, 1005(b)) OK
OPPOSITION: Filed on March 20, 2023 . [ ] Late [ ] None
REPLY: Filed on March
28, 2023. [X] Late [ ] None
ANALYSIS:
I.
Background
On November 28, 2022, Plaintiff Kyle Johnson (“Plaintiff”),
conservator of the estate of Nichelle Nichols, filed an action against
Defendant Stars North, LLC (“Defendant”) for breach of contract and common
counts.
On December 29, 2022, Plaintiff filed a Substitution of
Attorney.
On January 26, 2023, Defendant filed a Motion to Dismiss
for Improper Venue (“Motion”). Plaintiff
filed an Opposition to the Motion (“Opposition”) on March 20, 2023. Defendant filed a late Reply to the
Opposition (“Reply”) on March 28, 2023.
II.
Legal Standard
Code of Civil Procedure § 418.10(a)(2) provides: “A
defendant, on or before the last day of his or her time to plead or within any
further time that the court may for good cause allow, may serve and file a
notice of motion for one or more of the following purposes…(2) To stay or dismiss the action
on the ground of inconvenient forum.” (Code Civ. Proc. § 418.10(a)(2).)
Code of Civil Procedure § 410.30(a), provides: “When a
court upon motion of a party or its own motion finds that in the interest of substantial
justice an action should be heard in a forum outside this state, the court
shall stay or dismiss the action in whole or in part on any conditions that may
be just.” (Code Civ. Proc., § 410.30(a).)
III.
Discussion
A.
Motion to Dismiss
Defendant moves for an Order dismissing
the present action, pursuant to Code of Civil Procedure §§ 410.30 and
418.10(a)(2), on the ground that the contract at issue contains a “mandatory”
forum selection clause which requires this action be litigated in Orange County,
Florida. (Mot. p. 2.) Plaintiff cannot show that the forum
selection clause is unreasonable because it was negotiated by the parties in
2015 and unaltered during negotiations in 2021.
(Ibid.) Thus, the action
should be dismissed and litigated in Orange County, Florida. (Ibid. at pp. 2-3.)
The action
arises out of an agreement between Defendant, a Florida-based production
company, and actress Nichelle Nichols (“Nichols”) to produce a feature-length
documentary on her life (“Agreement”). (Ibid.
at pp. 7-8; Thompson Decl. ¶¶ 1, 3-4, Ex. A.) This Agreement contains a mandatory forum
selection clause that was “negotiated in an arms’ length bargain in 2015.” (Ibid.) It states “CHOICE OF LAW/FORUM:
This Agreement shall be interpreted under the laws of Florida and venue for any
dispute arising hereunder shall be exclusively Orange County, Florida.” (Ibid.) In 2021, Plaintiff (who is Nichols’s son and conservator),
his counsel, and Defendant negotiated an amendment to the Agreement; however,
the amendment did not change the mandatory forum selection clause, as the
amendment stated “All remaining terms of the Agreement that do not conflict
with this Amendment shall remain unchanged and enforceable.” (Mot. p. 8.; Thompson Decl. ¶ 5, Ex.
B.)
Furthermore,
Defendant argues that “Plaintiff cannot meet his ‘heavy burden’ to show that
the mandatory forum selection clause, negotiated freely and thereafter left in
place during a second negotiation, is ‘unreasonable’ within the meaning of controlling
authority.” (Mot. pp. 10-14.) Defendant cites to legal authority to
demonstrate that Plaintiff’s choice of forum and any alleged inconvenience or
cost to Plaintiff is not given any weight when a mandatory forum selection
clause is present in the agreement. (Ibid.
at pp. 11-12.) Moreover, Plaintiff
cannot show any grounds of “unreasonableness.”
(Ibid. at p. 13.) First,
the instant action is a breach of contract case and there is no unique
California statute or remedies at issue.
(Ibid.) Second, there is a
rational basis for the choice of forum as Defendant is a Florida-based entity,
all of its principals and records exist in Florida, and Plaintiff would have a
reasonable expectation that a lawsuit may be filed in Florida due to these factors. (Ibid. at pp. 13-14; Thompson Decl. ¶¶
1-2.) Third, “there is no possible
impairment of California public policy…[as] none of the claims rely on a sui
generis California statute or remedy.” (Mot.
pp. 13-14.)
B.
Opposition
Plaintiff opposes Defendant’s
Motion. Plaintiff argues that the
contract is governed by Labor Code § 925, “as it pertains to employee/employer
relations by giving Plaintiffs who primarily work and reside in California the
right to void forum selection clauses that would require litigation outside of
the state of California.” (Oppos. p.
4.) Plaintiff states that in 2015,
Nichols entered in an employment contract with Defendant and under the terms of
the contract, she “agreed to license the documentary film rights to her life”
to Defendant, as well as “to market the film, provide access to her home and
memorabilia, and to sign autographs and a thank you message for supporters of
the project.” (Ibid.) Moreover, the “Ownership” section of the
contract states that Defendant “shall be the owner and deemed author of all
right title and interest in and to the right and proceeds of NN’S (NICHOLS)
participation in the Film . . . All such Work Product shall be considered
“work-for-hire” under U.S. and International copyright laws.” (Ibid. at pp. 4-5.)
Plaintiff argues that Nichols falls
under the definition of “employee” under Labor Code § 3351. (Ibid. at p. 5.) Plaintiff analyzes the factors presented by
S.G. Borello & Sons, Inc. v. Department of Industrial Relations, that
distinguish an employee from an independent contractor, and argues that these
factors demonstrate that Nichols is an employee. (Ibid.; S. G. Borello & Sons,
Inc. v. Department of Industrial Relations (1989) 48 Cal.3d at p. 355.) Plaintiff explains that Nichols “had to
appear on camera as scheduled by the Defendant, the marketing efforts for the
film were coordinated by the Defendant and, while NICHOLS could give creative
input, the contract clearly states that Defendant would have control over final
decision making if the two ever came to an impasse.” (Ibid. at pp. 5-6.) Other factors also demonstrate that Nichols
was employee. (Ibid. at p. 6.) Nichols’ managerial skill did not affect the
film’s profit, she was promised a fee plus a percentage of the gross profits,
she did not invest any money in making the film, and Defendant was to negotiate
distribution of the film. (Ibid.) Nichols did not invest in or provide any equipment
for making the film or hire any helpers and no one else could appear on camera
instead of her. (Ibid.) Even though Nichols was an actress, the film
at issue was a documentary film and did not require her to use her acting
abilities. (Ibid.) Nichols worked for Defendant for several
months, which in the context of the film industry “is a considerable amount of
time.” (Ibid. at p. 7.) Finally, “Nichols’ role was integral to the
ordinary work of the Defendant’s business” as she “was hired to feature in and
promote a film.” (Ibid.)
Plaintiff also analyzes the
relationship between Nichols and Defendant based on the factors presented in Dynamex
Operations W. v. Superior Court, to show that Nichols falls under the
category of employee. (Ibid.; Dynamex
Operations W. v. Superior Court (2018) 4 Cal. 5th 903.) Plaintiff states that under the factors in Dynamex,
Defendant has the burden to show that Nichols was not an employee. (Ibid at p. 8.) First, out of the tasks Nichols was hired to
do, including appearing in the film, marketing the film, signing autographs,
and recording thank you messages, Defendant controlled three out of the four
tasks, thus, Nichols was not free from her employer’s control in accomplishing
the tasks. (Ibid.) Second, the work to be done by Nichols “was
in line with the ordinary course of business for the company” given that
Defendant is a motion picture company that produces “a combination of scripted
and documentary work.” (Ibid.) Third, “Nichols’ primary income was derived
from making public appearances and signing autographs connected to television
work she did earlier in her life,” however, she was not in the business of
making films and Defendant had the ultimate decision-making power regarding use
of Defendant’s home and memorabilia. (Ibid.
at pp. 8-9.)
Even if the Court finds that
Nichols is not an employee based on the factors delineated above, Nichols is a
statutory employee under Labor Code § 3351.5 as the contract is for a
work-for-hire project. (Ibid. at
p. 10.)
Given that it is an employment contract,
Plaintiff argues that it is subject to Labor Code § 925 and thus, allows
Plaintiff to void a forum selection clause. (Ibid. at pp. 9-10.) As it was foreseeable that Defendant would
have to litigate the matter in California, Defendant “will not suffer any undue
harm by having this dispute heard in the county where the Contract was signed
and performed.” (Ibid. at p.
11.) Finally, Plaintiff argues that
Labor Code § 925 demonstrates a strong public policy of “granting employees who
primarily work and reside in California the benefit of having their employment
disputes heard in California courts.” (Ibid.)
The Court notes
that the Opposition presents these arguments in of a Memorandum of Points and
Authorities and does not contain any declarations, affidavits, or exhibits to
support Plaintiff’s arguments.
C.
Reply
On March 28, 2023, Defendant filed
a Reply, one day after the deadline for filing a reply in this case. The Court in its discretion, considers
Defendant’s Reply. (Cal. Rules of Court,
rule 3.1300(d).) Defendant argues that
“Plaintiff’s Opposition fails for two critical reasons.” (Reply p. 4.) First, Labor Code § 925 does not apply if
legal counsel represented the employee during negotiations of the
contract. (Ibid.) Second, Plaintiff has not presented any
evidence that Nichols was an employee of the company, while Defendant presents
evidence demonstrating that “neither party intended Ms. Nichols to be an
employee and why she was not.” (Ibid.)
First, Nichols was represented by
her Talent Manager, Gilbert Bell, her Publicist, Michael Conley, and her legal
counsel during the negotiations of the Agreement. (Supp. Thomson Decl. ¶ 3; Conley Decl. ¶¶ 1-3;
Galloway Decl. ¶ 3.) Conley served as an
intermediary between Nichols, her legal counsel, and Talent Manager, while Todd
Thompson and Greg Galloway represented Defendant. (Ibid.) Defendant states that Conley cannot recall
Nichols’s legal counsel’s name but “knows for a fact that there was a lawyer
representing Ms. Nichols at the time” and believes it was Jeffrey C. Foy. (Conley Decl. ¶ 3.) During this negotiation, the attorney
representing Nichols made several changes to the Agreement. (Supp. Thomson Decl. ¶ 3; Conley Decl. ¶ 3;
Galloway Decl. ¶ 3.) Defendant has
attached an email thread demonstrating references to the changes made by
Nichols’s attorney. (Supp. Thomson Decl.
¶ 4, Ex. A; Conley Decl. ¶ 4, Ex. A; Galloway Decl. ¶ 4, Ex. A.) Five years later, in 2021, Plaintiff,
Nichols’s son and conservator, negotiated amendments to the agreement “[w]ith
his retained counsel of choice,” Rickey Ivie, Senior Partner and Owner of Ivie,
McNeill & Wyatt. (Supp. Thompson
Decl. ¶¶ 5-6; Galloway Decl. ¶ 6.) Prior
to signing the Amendment, Plaintiff replaced his attorney with S. Michael
Kernan, The Kernan Law Firm, an attorney specializing in entertainment law. (Supp. Thompson Decl. ¶ 6, Ex. B; Galloway
Decl. ¶ 6, Ex. B.) On the date of signing the Amendment, Kernan
represented Plaintiff and Galloway represented Defendant. (Ibid.)
Second, Nichols was not an employee
under the Agreement; she was a co-producer of the film and a member of
management. (Supp. Thompson Decl. ¶ 7;
Reply pp. 6-7.) Defendant paid her for
her life rights and to interview her a couple of times “at the time, date, and
location of her choice.” (Supp. Thompson
Decl. ¶ 7.) She did not perform
any services as an employee on payroll, she did not perform any “duties related
to lighting, props, set building and tear down, make up, wardrobe, editing,
sound, transportation, catering, or other support services.” (Ibid. at ¶ 8.) Furthermore, “[s]he was not a line producer,
unit production manager, assistant director, cinematographer, production
designer, custom designer, hair and make-up specialist, production sound mixer,
grips, key grip, gaffers, ‘best boy,’ set dressers, extras, stunt performer,
special effects artist, craft servicemember, or script supervisor – which are the
usual employee (‘below the line’) positions on a movie.” (Ibid.) Nichols was not on the Company’s payroll and
was not paid a paycheck, “[s]he was at all times ‘above the line’ in
entertainment accounting terms.” (Supp.
Thompson Decl. ¶¶ 7, 9.) Defendant
states that she was not considered an employee by any owner, director, officer,
or managing agent of the Company. (Ibid.
at ¶ 10.)
Defendant argues that according to
the factors set forth in S.G. Borello & Sons, Inc., Nichols was not
an employee. (Reply p. 7; S. G.
Borello (1989) 48 Cal.3d 459.)
First, Nichols “had control over life rights, control over the use of
her memorabilia, and control over the time, place, and manner of the interviews
of her.” (Supp. Thompson Decl. ¶
11.) The Amendment to the Agreement,
negotiated by Plaintiff’s attorney re-affirms Nichols’s control over her life
rights as it states that “[n]otwithstanding anything stated to the contrary
above, NN shall be free to license her life story rights to any third party for
book publishing, scripted films or any other products that do not infringe upon
the Film copyright.” (Ibid.) Nichols also had control over her
participation in the production of the film.
(Ibid.) Nichols was a
co-producer and member of the management team, so the agreement gave her a
percentage of the profits and allowed her the opportunity to profit from the
film. (Ibid.) Nichols “supplied all memorabilia and footage
of her earlier interviews, which were her unique property” and the film was
“entirely unique to her.” (Ibid.) As to the degree of permanence of the working
relationship, the film “was a one-time production with no lasting working
relationship contemplated by either side.”
(ibid.) Nichols’s role was
limited to this production and “not integral to the Company’s ongoing
business.” (Ibid.)
Defendant further argues that
Nichols does not fall into the employee category based on the factors set forth
in Dynamex Operations W. v. Superior Court. (Dynamex Operations W. v. Superior Court
(2018) 4 Cal. 5th 903; Reply p. 8; Thompson Decl. ¶ 12.) Nichols was not employee because she “had
control over her part in the production, her role was being the subject of a
movie, and she was independently involved in the same type of business
(entertainment) with her own holding company and as Co-Producer on the film.” (Ibid.)
Finally, the “work for hire” clause
in the Agreement is not dispositive as the determination of employee status is
a question of fact to be resolved by the consideration of factors
distinguishing an employee from an independent contractor. (Reply pp. 11-12.) Plaintiff has also not shown that is
foreseeable that the case would be litigated in California. (Ibid. at
p. 12.)
Defendant states that the unsworn
statements of Plaintiff’s counsel presented in the Opposition, without a sworn
declaration, do not contain any admissible evidence to show that Nichols was an
employee. (Reply pp. 9-10.) Thus, Plaintiff has not met the heavy burden
to defeat the mandatory forum selection clause.
(Ibid. p. 12.)
D.
Analysis
“The procedure for enforcing a
forum selection clause is a motion to stay or dismiss for forum non conveniens.” (Code Civ. Proc. § 410.30; Olinick v. BMG
Entertainment (2006) 138 Cal.App.4th 1286, 1294.) “Forum non conveniens is an equitable doctrine, codified
in Code of Civil Procedure section 410.30, under which a trial court has
discretion to stay or dismiss a transitory cause of action that it believes may
be more appropriately and justly tried elsewhere. [Citation.] The inquiry is whether ‘in the interest
of substantial justice an action should be heard in a forum outside this state….’
[Citation.]” (Animal Film, LLC v.
D.E.J. Productions, Inc.¿(2011) 193 Cal.App.4th 466, 471.)
“In a contract dispute in which
the parties’ agreement contains a forum selection clause, a threshold issue in
a forum non conveniens motion is whether the forum
selection clause is mandatory or permissive.”
(Animal Film, LLC, supra, 193 Cal.App.4th at p. 471.) Where a forum selection clause is “mandatory”
and thus, “mandate[s] litigation exclusively in a particular forum”, “the
modern trend is to enforce mandatory forum selection clauses unless they are
unfair or unreasonable.” (Berg v. Mtc
Electronics Techs. Co. (1998) 61 Cal.App.4th 349, 358-359.) In other words, “[a] court will usually honor
a mandatory forum selection clause without extensive analysis of factors
relating to convenience”—rather, “the test is simply whether application
of the clause is unfair or unreasonable.”
(Ibid.) The plaintiff
bears the burden of demonstrating that enforcement of the clause would be
unreasonable under the circumstances of the case. (Lu v. Dryclean-U.S.A. of California, Inc.
(1992) 11 Cal.App.4th 1490, 1493.) Conversely,
where a forum selection clause is “permissive,” that is, where “‘the clause
merely provides for submission to jurisdiction and does not expressly mandate
litigation exclusively in a particular forum, then the traditional forum non conveniens analysis applies.’ [Citations.]” (Animal Film, LLC, supra, 193
Cal.App.4th at p. 471.)
Here, the parties do not dispute
that the Agreement contains a mandatory forum selection clause. At issue is whether Labor Code § 925 applies.
Labor Code § 925 provides:
(a) An employer shall not require an
employee who primarily resides and works in California, as a condition of
employment, to agree to a provision that would do either of the following:
(1) Require the employee to
adjudicate outside of California a claim arising in California.
(2) Deprive the employee of the
substantive protection of California law with respect to a controversy arising
in California.
(b) Any provision of a contract that
violates subdivision (a) is voidable by the employee, and if a provision is
rendered void at the request of the employee, the matter shall be adjudicated
in California and California law shall govern the dispute.
(c) In addition to injunctive relief
and any other remedies available, a court may award an employee who is
enforcing his or her rights under this section reasonable attorney’s fees.
(d) For purposes of this section,
adjudication includes litigation and arbitration.
(e) This section shall not apply to
a contract with an employee who is in fact individually represented by legal
counsel in negotiating the terms of an agreement to designate either the venue
or forum in which a controversy arising from the employment contract may be
adjudicated or the choice of law to be applied.
(f) This section shall apply to a
contract entered into, modified, or extended on or after January 1, 2017.
Here, Plaintiff opposes the Motion
arguing that Labor Code §
925 voids the mandatory forum selection clause because the Agreement is an
employment contract between Nichols, an employee who resided and
worked in California, and Defendant, an employer. However, Plaintiff has not submitted a
declaration, affidavit, or any facts in support of its opposition that
demonstrate that Nichols indeed qualifies as an employee under Labor Code §
3351 and resided in California as of the Agreement.
Furthermore, Defendant argues that
even if Nichols was an employee, Labor Code § 925 does not apply because she was represented by
legal counsel at the time of negotiating the terms of the Agreement and
Plaintiff, her son and conservator, was represented by counsel at the time of
negotiating the Amendment to the Agreement.
The Court finds that the Agreement has a mandatory forum
selection clause, that the parties do not dispute. In its Opposition, Plaintiff does not argue
that the forum selection clause is “unfair or unreasonable.” Furthermore, Plaintiff does not present
sufficient facts to demonstrate that Labor Code § 925 applies to the instant
case and should void the forum selection clause.
Accordingly, Defendant’s Motion to Dismiss for Improper
Venue is GRANTED.
IV.
Conclusion
& Order
For the foregoing reasons,
Defendant Stars North, LLC’s Motion to
Dismiss for Improper Venue is GRANTED.
Moving party is ordered to give
notice.