LLP WIFIRV v. MHC LLC (2010)

RULING ON MOTION TO DISMISS (# 101.00)

On June 30, 2010, the plaintiff, WiFiLand, LLP d/b/a WIFIRV, a Connecticut limited liability partnership, commenced this action against the defendant, Whispering Palms MHC, LLC, a Florida limited liability company.   In its two-count complaint, the plaintiff alleges that on December 1, 2008, the parties entered into a five-year written agreement whereby the plaintiff would install a communications facility at the defendant's park in order to provide high speed wireless internet service to the park's residents.   The defendant agreed to grant “Marketing Exclusivity” to the plaintiff by, inter alia, agreeing not to market or sell other communication services to the park's residents.   The defendant also entered into a revenue sharing plan with the plaintiff whereby the defendant would pay a flat fee for the plaintiff's services and the plaintiff would collect revenues directly from the end-users of the communications facility.   However, in August of 2009, the defendant “caused the business class internet service to be disconnected from [the plaintiff's] Communications Facility, rendering [the plaintiff] unable to serve” the park's residents.   Count one sounds in breach of contract, count two, in breach of the implied covenant of good faith and fair dealing.

On July 27, 2010, the defendant filed the present motion to dismiss (# 101) for lack of personal jurisdiction on the ground that, because the defendant is not registered to conduct business in Connecticut, jurisdiction is proper only if exerted under General Statutes § 33-929, Connecticut's longarm statute, and the plaintiff has failed to allege facts that satisfy the requirements of § 33-929 and would permit the court to exercise jurisdiction over the defendant.   On September 3, 2010, the plaintiff filed a memorandum of law in opposition to the defendant's motion to dismiss.   The plaintiff argues that the defendant's motion ignores and fails to address the fact that the contract at issue in the present case contains a forum selection clause specifying that Connecticut law shall govern the contract and any disputes arising from the contract shall lie in Fairfield County, Connecticut.   The forum selection clause provides:  “This License Agreement shall be governed by the laws of the State of Connecticut and any venue for any lawsuit pursuant to the obligations pursuant to the obligation of the parties to this License Agreement shall lie in Fairfield County, Connecticut.”

In reply the defendant argues that it has not waived jurisdiction because the plain language speaks to choice of law and venue, but not jurisdiction.   The defendant concedes that although the contract establishes venue in Fairfield County, the defendant's agent, Juan Jaramillo construed the clause in the agreement, which was inserted by the plaintiff's agent John Michael Borg, to mean a federal court case would be held in Connecticut.   The defendant contends that to the extent that the language in the agreement is ambiguous, the ambiguity should be resolved in the defendant's favor.   The plaintiff in reply argues, as an initial matter, that nothing in the forum selection clause makes any mention of a federal court and the defendant does not indicate how, in signing the document, it intended to consent to the exercise of jurisdiction to a federal court located in Connecticut but not the Connecticut state courts.   Moreover, the plaintiff asserts, it is unlikely that any dispute between the parties arising out of their agreement would either raise a question of federal law under 28 U.S.C. § 1331 or involve an amount in controversy in excess of seventy-five thousand dollars under 28 U.S.C. § 1332.

Under Practice Book § 10-31(a)(3) a motion to dismiss “shall be used to assert improper venue.”  “[I]n ruling upon whether a complaint survives a motion to dismiss, a court must take the facts to be those alleged in the complaint including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader.”  Lawrence Brunoli v. Branford, 247 Conn. 407, 410-11, 722 A.2d 271 (1999).   Where a motion to dismiss “is accompanied by supporting affidavits containing undisputed facts, the court may look to their content for determination of the jurisdictional issue and need not conclusively presume the validity of the allegations of the complaint.”  Shay v. Rossi, 253 Conn. 134, 140, 749 A.2d 1147 (2000);  Barde v. Board of Trustees, 207 Conn. 59, 62, 539 A.2d 1000 (1988).

Connecticut law is clear the “courts will uphold an agreement of the parties to the jurisdiction of a particular tribunal.”  Phoenix Leasing, Inc. v. Koskinski, 47 Conn.App. 650, 653, 707 A.2d 314 (1998), citing Fairfield Lease Corp. v. Romano's Auto Service, 4 Conn.App. 495, 498, 495 A.2d 286 (1985).   The Connecticut Supreme Court has adopted the holding of the United State Supreme Court that forum selection clauses are valid unless the party seeking to preclude enforcement can meet the heavy burden of showing that its enforcement would be unreasonable, unfair, or unjust.  Reiner, Reiner and Bendett, P.C. v. The Cadle Company, 278 Conn. 92, 101-02, 897 A.2d 58 (2006), citing Bremen v. Zapata Off Shore Co., 407 U.S. 1, 92 S.Ct. 1907, 32 L.Ed.2d 513 (1972).   The Court in Bremen elaborated on that heavy burden by enumerating “several factors that could result in a clause being held unenforceable, including fraud or overreaching in the contract negotiations, serious inconvenience from litigating in the selected forum, or the contravention of a strong public policy in the forum in which suit is brought if the clause is enforced.”  Reiner, Reiner and Bendett, P.C., supra at 102, n. 8.

The defendant has not claimed any fraud or overreaching in the negotiation of that clause, nor has it met the heavy burden of showing that enforcement of the forum selection clause would be unreasonable, unfair or unjust.   The defendant simply argues that the clause is ambiguous, that the defendant never intended to submit to the jurisdiction of Connecticut's state courts and that the court should construe the clause as an agreement to submit only to the jurisdiction and venue of federal district court located in Fairfield County.   The court finds that the forum selection clause is clear and unambiguous on its face and expresses the agreement of the parties to submit to the jurisdiction of either a federal or state court having a venue in Fairfield County.   The defendant's motion to dismiss is therefore denied.

Michael G. Maronich, Judge

Maronich, Michael G., J.