United States District Court, S.D. New York
ALLIANZ GLOBAL CORPORATE & SPECIALTY, as subrogee and assignee of SOUTHERN TELECOM, INC., Plaintiff,
OPINION AND ORDER
RONNIE ABRAMS, District Judge.
Allianz Global Corporate & Specialty ("Allianz") brings these cases as the subrogee and assignee of Southern Telecom, Inc. and Robert Bosch LLC, seeking recovery for certain cargo shipped from China to New Jersey and allegedly damaged by flooding from Hurricane Sandy. Before the Court is a motion to dismiss by Defendants Kawasaki Kisen Kaisha Co. Ltd. and "K" Line America, Inc. ("K' Line") on the basis of an exclusive forum selection clause in the bills of lading that "K" Line issued for the insured shipments. For the reasons stated below, the motion to dismiss is granted.
Allianz's claims against "K" Line arise out of two shipments, one of electronic accessories and one of security systems, shipped together from China on the Defendant vessel "CHISWICK BRIDGE" and discharged in New Jersey on or about October 27, 2012 - two days before Hurricane Sandy struck New Jersey. (Compl. 1 ¶ 11; Compl. 2 ¶ 10.)
Allianz alleges that the shipments were damaged by "wetness" from the hurricane as a result of Defendants' negligence. (Compl. 1 ¶ 13; Compl. 2 ¶ 15.) "K" Line is sued for discharging the cargo from the "CHISWICK BRIDGE" two days before the hurricane. (Compl. 1 ¶ 14; Compl. 2 ¶ 16.) Defendants, Allianz claims, knew or should have known about the "well predicted and highly publicized impact" of the hurricane, including expected storm surges, rising Water levels, heavy wind, and rain. (Compl. 1 ¶¶ 14, 17; Compl. 2 ¶¶ 16, 18.) In addition, because Defendants allegedly agreed to perform services and act as a carrier or bailee of the shipments, Allianz seeks to hold them liable for the breach of that agreement and of their obligations as carriers of goods for hire and/or bailees "under applicable contracts or law." (Compl. 1 ¶ 24; Compl. 2 ¶ 25.)
"K" Line issued waybills for the shipments, both of which incorporated the terms and conditions of "K" Line's standard Combined Transport Bill of Lading ("Combined Bill of Lading"). (Compl. 1 ¶ 10; Compl. 2 ¶ 12; Johnson Declaration (Johnson Decl.) ¶¶ 5-7.) The terms and conditions of the Combined Bill of Lading contain a "Governing Law and Jurisdiction" clause which provides:
The contract evidenced by or contained in this Bill of Lading shall be governed by Japanese law except as may be otherwise provided for herein, and any action thereunder or in connection with Carriage of Goods shall be brought before the Tokyo District Court in Japan, to whose jurisdiction Merchant irrevocably consents.
(Johnson Decl. Ex. C.)
On October 25, 2013, Allianz filed the 13-cv-7559 and 13-cv-7565 Complaints in the Southern District of New York. "K" Line answered both Complaints on December 2, 2013, and asserted an affirmative defense based on the forum selection clause in the Combined Bill of Lading. (13-cv-7559 Dkt. 4; 13-cv-7565 Dkt. 4.) On April 1, 2014, "K" Line moved to dismiss the Complaints, arguing that the forum selection clause mandates that any claim against "K" Line be brought in Tokyo. (13-cv-7559 Dkt. 42; 13-cv-7565 Dkt. 39.)
"K" Line filed its motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) and 12(c). Until last year, it was unclear what the proper procedural mechanism was for filing a motion to enforce a forum selection clause. The Supreme Court resolved this uncertainty in Atlantic Marine Constr. Co. v. United States District Court for the Western District of Texas, holding that a party seeking to enforce a forum selection clause designating a foreign forum should do so by way of a motion to dismiss for forum non conveniens. 134 S.Ct. 568, 580 (2013). Although the decision left open the question of whether such a motion may alternatively be brought under Rule 12(b)(6), 134 S.Ct. at 580, the Court will construe "K" Line's motion under the forum non conveniens principles articulated in Atlantic Marine. In deciding the motion, the Court may rely on the pleadings and affidavits submitted in connection with the motion, but cannot resolve any disputed material fact in the movant's favor unless an evidentiary hearing is held. Martinez v. Bloomberg LP, 740 F.3d 211, 216-17 (2d Cir. 2014); see also Midamines SPRL Ltd. v. KBC Bank NV, No. 12 Civ. 8089 (RJS), 2014 WL 1116875, at *2, n.5 (S.D.N.Y. Mar. 18, 2014).
The enforceability of the forum selection clause is governed by federal law. Martinez, 740 F.3d at 217; Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 590 (1991). Under the doctrine of forum non conveniens, a valid forum selection clause must be given "controlling weight in all but the most exceptional cases." Atlantic Marine, 134 S.Ct. at 581. In the admiralty context, forum selection clauses "are prima facie valid and should be enforced" unless the resisting party meets the "heavy burden" of showing that enforcement would be unreasonable under the circumstances. M/S Breman v. Zapata Off-Shore Co., 407 U.S. 1, 10, 17 (1972).
Courts in this Circuit employ a four-part analysis to determine the validity of a forum selection clause. Phillips v. Audio Active, Ltd., 494 F.3d 378, 383-84 (2d Cir. 2007). First, the Court must determine: (1) whether the clause was "reasonably communicated" to the party resisting enforcement, (2) whether the clause is mandatory or permissive, and (3) whether the claims and parties involved in the suit are subject to the clause. Id. at 383. If these three requirements are met, the forum selection clause is presumptively enforceable. Id . (citing Roby v. Corp. of Lloyd's, 996 F.2d 1353, 1362-63 (2d Cir. 1993)). The final step of the analysis is for the Court to ascertain whether the resisting party has rebutted the presumption of enforceability by showing that ...