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Christian Relief Services Charities Inc. v. Silktree Investments LLC

United States District Court, D. Arizona

February 25, 2019

Christian Relief Services Charities Incorporated, Plaintiff,
v.
Silktree Investments LLC, et al., Defendants.

          ORDER

          Dominic W. Lanza, United Slates District Judge.

         Pending before the Court is Plaintiff Christian Relief Services Charities, Inc.'s (“Plaintiff”) motion to remand to state court. (Doc. 10.) The motion is fully briefed and neither party has requested oral argument. As explained below, the motion to remand is granted. Moreover, because Defendant lacked an objectively reasonable basis for seeking removal, Plaintiff's request for attorneys' fees and costs is granted.

         BACKGROUND

         On December 7, 2018, Plaintiff filed a complaint in Maricopa County Superior Court asserting various claims against Defendant Silktree Investments LLC (“Defendant”). (Doc. 1-3.)

         On December 31, 2018, Defendant removed the case to federal court. (Doc. 1.) Defendant's removal notice stated that removal was appropriate because the parties are diverse and the amount in controversy exceeds $75, 000. (Id.)

         On January 14, 2019, Plaintiff filed a motion to remand the case to state court. (Doc. 10.) Plaintiff argues that a remand is required because the parties' contract contains a forum selection clause under which they agreed that all disputes would be litigated in state court. (Id. at 2-4.) Plaintiff also seeks an award of fees and expenses under 28 U.S.C. § 1447(c). (Id. at 4.)

         On February 4, 2019, Defendant filed a response to the motion to remand. (Doc. 16.) Defendant argues that a remand isn't required here because “[w]hile the wording in this contract contemplates the filing of any initial suit in Maricopa County Superior Court, the language does not suggest, indicate or even imply jurisdiction in the state court is meant to be ‘exclusive.'” (Id. at 3.) Defendant further argues that, even if it loses on the merits, the Court shouldn't award fees and expenses under § 1447(c) because its position is objectively reasonable. (Id. at 6-7.)

         On February 13, 2019, Plaintiff filed a reply. (Doc. 19.)

         ANALYSIS

         I. The Parties' Forum Selection Clause Mandates Remand

         A forum selection clause is a ground for not exercising jurisdiction over a case, similar to abstention in favor of state court jurisdiction or refusal to exercise supplemental jurisdiction. Kamm v. ITEX Corp., 568 F.3d 752, 756 (9th Cir. 2009). Federal law governs the validity of a forum selection clause in a diversity case. Manetti-Farrow, Inc., v. Gucci Am., Inc., 858 F.2d 509, 513 (9th Cir. 1988). If the language of the forum selection clause mandates that an action be brought in a specified venue, courts must enforce the clause, absent exceptional circumstances not at issue here.[1] Docksider, Ltd. v. Sea Tech., Ltd., 875 F.2d 762, 764 (9th Cir. 1989) (“[W]here venue is specified with mandatory language the clause will be enforced.”).

         Whether a forum selection clause is mandatory or permissive is a question of contract interpretation. See Hunt Wesson Foods, Inc. v. Supreme Oil Co., 817 F.2d 75, 77 (9th Cir. 1987). “A primary rule of interpretation is that ‘[t]he common or normal meaning of language will be given to the words of a contract unless circumstances show that in a particular case a special meaning should be attached to it.'” Id. (quoting 4 S. Williston, A Treatise on the Law of Contracts § 618 (W. Jaeger 3d ed. 1961)). The forum selection clause in the parties' contract provides:

12.5 Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State. The jurisdiction and venue for any action or proceeding brought by either party shall be the ...

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