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Keywords

contractplaintiffdefendantmotionmotion to dismiss
contractplaintiffdefendantjurisdictiondiscoverytrialmotioncorporationmotion to dismiss

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Collins v. Mary Kay, Inc., Not Reported in Fed. Supp., 2016 WL 3546581

Facts

Plaintiff Ina Collins, a New Jersey resident, worked as a Beauty Consultant for Mary Kay, Inc. and entered into two contracts with the company that included a forum selection clause mandating disputes be resolved in Texas. Collins alleged that Mary Kay's treatment of her violated the New Jersey Wage Payment Law, claiming she was misclassified as an independent contractor and compelled to purchase products as part of her employment. After filing a complaint in New Jersey, Mary Kay moved to dismiss the case based on the forum selection clause.

Plaintiff is a New Jersey resident and previously worked as a Mary Kay Beauty Consultant. … On September 28, 2015, Plaintiff filed a Complaint in this Court alleging that Mary Kay's treatment of her violated the New Jersey Wage Payment Law (“NJWPL”), N.J. Stat. Ann. § 34:11-4.1 et seq. (2016).

Issue

Whether the forum selection clause in the contracts between Plaintiff and Defendant is enforceable and whether Plaintiff's claims fall within its scope.

The Court first examines whether the forum selection clause is enforceable, and then determines whether Plaintiff's claims are within its reach.

Rule

The enforceability of a forum selection clause is determined by federal law, and such clauses are generally upheld unless the opposing party can show that enforcement would be unreasonable or unjust.

Because questions of venue are procedural rather than substantive, a federal court determines the effect to be given a contractual forum selection clause in a diversity case by applying federal law rather than state law.

Analysis

The court analyzed the forum selection clause and determined that it was enforceable, as it broadly covered 'any dispute or controversy … concerning any matter relating to this Agreement.' The court found that Plaintiff's claims under the New Jersey Wage Payment Law were sufficiently connected to the contractual relationship, as they arose from the terms of the agreements. The court also noted that Plaintiff had not met the burden of showing that public interest factors overwhelmingly disfavored dismissal.

The first inquiry, whether an alternative forum exists, is usually satisfied where 'the defendant is amenable to process in the other jurisdiction.' … Here, Defendant Mary Kay, Inc. is a corporation with its principal place of business in Addison, Texas.

Conclusion

The court granted Defendants' motion to dismiss, enforcing the forum selection clause and requiring the case to be litigated in Texas.

For the foregoing reasons, Defendants' Motion to Dismiss, Dkt. No. 7, is GRANTED.

Who won?

Defendants prevailed in the case because the court upheld the forum selection clause, determining that Plaintiff's claims were subject to it and should be litigated in Texas.

Defendant has offered many rationales that favor enforcing the forum selection clause. … Accordingly, pretrial discovery may be conducted more quickly and efficiently in Texas than in New Jersey, where only the Plaintiff resides.

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