Judge: Peter A. Hernandez, Case: 24STCV19330, Date: 2025-02-24 Tentative Ruling

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Case Number: 24STCV19330    Hearing Date: February 24, 2025    Dept: 34

Defendant Rule27 Design LLC’s Motion to Dismiss is GRANTED.

Background

            On August 2, 2024, Plaintiff Seth Wexler (“Plaintiff”) filed a complaint against Defendant Rule27 Design LLC (“Defendant”) arising from Plaintiff’s employment with Defendant alleging causes of action for:

1.                 Declaratory Relief;

2.                 Accounting; and

3.                 Violation of Civil Code § 1738.13.

On September 17, 2024, Defendant filed a general denial to Plaintiff’s complaint.

On December 24, 2024, Defendant filed a Motion to Dismiss. On February 7, 2025, Plaintiff filed an opposition.

Legal Standard

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.” 

“In determining whether to grant a motion based on forum non conveniens, a court must first determine whether the alternate forum is a ‘suitable’ place for trial. If it is, the next step is to consider the private interests of the litigants and the interests of the public in retaining the action for trial in California.” (Stangvik v. Shiley Incorporated (1991) 54 Cal.3d 744, 751.) 

“An alternative forum is suitable if it has jurisdiction and the action in that forum will not be barred by the statute of limitations. It bears emphasis that ‘[i]t is sufficient that the action can be brought, although not necessarily won, in the suitable alternative forum.’ That the law is less favorable to the plaintiffs in the alternative forum, or that recovery would be more difficult if not impossible, is irrelevant to the determination whether the forum is suitable unless ‘the alternative forum provides no remedy at all.’” (Guimei v. General Electric Co. (2009) 172 Cal.App.4th 689, 696 (citations omitted).) The ‘no remedy at all’ exception applies ‘only in “rare circumstances,” such as where the alternative forum is a foreign country whose courts are ruled by a dictatorship, so that there is no independent judiciary or due process of law.’ [Citation.]” (Guimei v. General Electric Co., supra, 172 Cal.App.4th at 696–697.) 

“The private interest factors are those that make trial and the enforceability of the ensuing judgment expeditious and relatively inexpensive, such as the ease of access to sources of proof, the cost of obtaining attendance of witnesses, and the availability of compulsory process for attendance of unwilling witnesses. The public interest factors include avoidance of overburdening local courts with congested calendars, protecting the interests of potential jurors so that they are not called upon to decide cases in which the local community has little concern, and weighing the competing interests of California and the alternate jurisdiction in the litigation.” (Guimei v. General Electric Co., supra, 172 Cal.App.4th at 701 (citations omitted).) 

“On a motion for forum non conveniens, the defendant, as the moving party, bears the burden of proof. The granting or denial of such a motion is within the trial court’s discretion, and substantial deference is accorded its determination in this regard.” (Stangvik v. Shiley Incorporated, supra 54 Cal.3d at 751.) 

Discussion

            Defendant moves to dismiss, or in the alternative, stay this action pursuant to California Code of Civil Procedure section 410.30 based on forum non conveniens. (Motion, at p. 3.) Defendant contends that on August 9, 2023, Plaintiff entered into an employment agreement with Defendant which stated that Arizona state and federal courts are the exclusive forum for any disputes regarding the agreement or arising out of the employment relationship. (Ibid.; Anderson Decl., ¶ 2, Exh. A.) 

            It is undisputed that the employment agreement between the parties contains the following provision:

“The terms of this Employment Offer and the resolution of any disputes as to the meaning, effect, performance, or validity of this letter agreement or arising out of, related to, or in any way connected with this, letter agreement, your employment with Rule27 or any other relationship between you and Rule27 (the “Disputes”) will be governed by Arizona law, excluding laws relating to conflicts or choice of law. You [Seth Wexler] submit to the exclusive personal jurisdiction of the federal and state courts located in Arizona in connection with any Dispute or related claim.”

(Anderson Decl. ¶ 2, Exh. A, p. 3.)

            Defendant argues that the forum-selection clause is mandatory as it states that Plaintiff submits to the exclusive personal jurisdiction of the Arizona courts. (Motion, at p. 5.) As such, Defendant contends that since the forum selection clause is mandatory, the only necessary consideration is if its enforcement is reasonable. (Id., at p. 6.) Defendant contends that Plaintiff cannot show that the clause is unreasonable as Arizona provides a fair and adequate forum for resolving the dispute and there is no indication that litigating in Arizona would be unduly burdensome for Plaintiff. (Ibid.) Additionally, Defendant notes that Defendant is located in Arizona, the agreement was entered into in Arizona, and Plaintiff performed all work for Defendant in Arizona while living in Arizona . (Ibid.) Lastly, Defendant argues that California’s interest does not override the forum-selection clause as Plaintiff’s allegations do not implicate any uniquely California-specific public policy concerns. (Ibid.)

            In opposition, Plaintiff argues that the plain language of the forum-selection clause in the agreement provides only for submission to personal jurisdiction in Arizona without mandating Arizona courts as the exclusive forum rendering the clause permissive, not mandatory. (Opp., at pp. 5-7.)

            The court finds that the forum-selection clause is mandatory as it clearly states that Plaintiff submits “to the exclusive personal jurisdiction” of the courts in Arizona. (Anderson Decl. ¶ 2, Exh. A, p. 3 [emphasis added].) Without personal jurisdiction, no other court or forum is appropriate. As such, when there is a mandatory forum selection clause, the court will not consider the traditional forum non conveniens factors.

“[T]he modern trend is to enforce mandatory forum selection clauses unless they are unfair or unreasonable. [Citations.] . . . If there is no mandatory forum selection clause, a forum non conveniens motion ‘requires the weighing of a gamut of factors of public and private convenience … .’ [Citation.] However if there is a mandatory forum selection clause, the test is simply whether application of the clause is unfair or unreasonable, and the clause is usually given effect. Claims that the previously chosen forum is unfair or inconvenient are generally rejected. [Citation.] A court will usually honor a mandatory forum selection clause without extensive analysis of factors relating to convenience. [Citation.] ‘‘Mere inconvenience or additional expense is not the test of unreasonableness …’’ of a mandatory forum selection clause.’ [Citations]” (Olinick v. BMG Entertainment (2006) 138 Cal.App.4th 1286, 1294; see C.C.P. §410.30.) 

            Plaintiff argues that the enforcement of the forum-selection clause would be unreasonable and unjust because if Plaintiff were forced to litigate his claims in Arizona, not only would he lose the right to assert claims under the California Labor Code, but Defendant would likely attempt to use the statute of limitations as a shield against Plaintiff’s claims for breach of contract unpaid commission. (Opp., at p. 12.)

            The court finds that Plaintiff has not shown that application of the forum-selection clause is unfair or unreasonable. The fact that Plaintiff may not be able to enforce California rights is insufficient to render the clause invalid. Moreover, the court does not find the Arizona statute of limitations a bar to enforce an otherwise reasonable forum selection clause.

Conclusion