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Vaporpath, Inc. v. WNA, Inc

United States District Court, W.D. Washington, Tacoma

December 3, 2019

VAPORPATH, INC., Plaintiff,
v.
WNA, INC., a Delaware Corporation, and NOVOLEX HOLDINGS, LLC, a Delaware limited liability company, Defendants.

          ORDER

          Ronald B. Leighton, United States District Judge.

         I. INTRODUCTION

         THIS MATTER is before the Court on Defendants WNA Inc. and Novolex Holdings LLC's Motion to Dismiss for Lack of Personal Jurisdiction and/or Transfer Venue under 28 U.S.C. 1404. [Dkt. # 18]. The case involves competing forum selection clauses. Defendants argue that their clauses (requiring venue in South Carolina and Texas) are mandatory and are enforceable over Plaintiff Vaporpath's permissive clause (providing for venue here).

         Vaporpath agreed to purchase disposable coffee cup lids from WNA. Vaporpath placed its first purchase order in August 2016. Vaporpath claims it included a copy of its terms and conditions with that and every subsequent purchase order. Its terms and conditions expressly rejected any additional or different terms and required venue in Washington, in courts having jurisdiction “at its address:”

BUYER EXPRESSLY OBJECTS TO AND EXPRESSLY REJECTS ANY PROVISIONS ADDITIONAL TO OR DIFFERENT THAN THE TERMS HEREOF. . . . [A]ll questions concerning the validity of this agreement, shall be governed by the laws of the State of Washington. Any suit, action or proceeding brought [under this contract] shall be commenced and maintained solely in state or federal courts having jurisdiction at the Buyer's address[.]

[Dkt. # 19, ex. 2] (emphasis added). In September 2016 WNA sent two shipments of lids to Vaporpath, along with order confirmations. WNA claims that it attached its own terms and conditions to those first two transactions. It conditioned its own acceptance of Vaporpath's order on Vaporpath's agreement to WNA's terms, which, it claims, required venue in Texas:

Acceptance of Buyer's order is expressly made conditional on assent to the terms and conditions set forth herein . . . . [The contract] shall be governed and construed in accordance with the laws of the State of Texas. Seller and Buyer specifically agree that any legal action brought relating to goods purchased or relating to this contract will be brought and tried in Texas. All objections to venue are hereby waived by Buyer[.]

[Dkt. # 19, ex. 1] (emphasis added). In June 2018, Novolex purchased WNA. Vaporpath continued to buy lids from WNA. Novolex added a link to its terms and conditions to WNA's order confirmations in October 2018. Its terms and conditions required venue in South Carolina:

Any claim, action, suit or other proceeding initiated under [this contract] may be asserted, brought, prosecuted and maintained only in federal or state court in the State of South Carolina having jurisdiction over the subject matter thereof, and the parties hereto hereby waive any and all right to object to the laying of venue in any such court[.]

[Dkt. # 20, ex. 4] (emphasis added).

         The parties had ongoing disputes about the quality of the lids during their three-year business relationship. Vaporpath claims that the lids it bought were defective, that they fell off cups, had no ventilation holes, and were contaminated with scrap plastic. Vaporpath sued for breach of contract and warranty in August 2019.

         Defendants move to dismiss Vaporpath's Complaint for lack of personal jurisdiction and/or to transfer venue under 28 U.S.C. §1404(a). They argue that their forum selection clauses are mandatory while Vaporpath's is only permissive. They argue that because there was no conflict between Defendants' mandatory clauses and Vaporpath's permissive clause, each forum selection clause became part of the parties' contract. Defendants argue that the case should be dismissed because Vaporpath waived its right to claim that this Court has personal jurisdiction over them by consenting to their mandatory forum selection clauses. Alternatively, they argue that this case should be transferred to the district court of South Carolina, or Texas, because Defendants' forum selection clauses require venue in those courts.

         Vaporpath argues that its clause is mandatory and that it requires the parties to litigate all lawsuits in this Court (or in Kitsap County Superior Court, which also has jurisdiction on Bainbridge Island). It argues that its forum selection clause (and not Defendants) became part of the contract through the parties' course of dealing. Alternatively, Vaporpath argues that neither party's forum selection clause became part of the contract because the conflicting clauses “knocked each other out” of the contract under the UCC. It argues that the Court has personal jurisdiction over Defendants. The forum selection clauses do not change that because they are not part of the contract and agreeing to venue is not the same as saying no other court has personal jurisdiction. It also argues that Defendants' motion to transfer should be denied because their forum selection clauses were knocked out of the contract and Vaporpath is entitled to its choice of forum.

         II. ...


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