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BNSF Logistics, LLC v. Totran Transportation Services, Inc.

United States District Court, W.D. Arkansas, Fayetteville Division

July 9, 2019




         Currently before the Court are Defendant Totran Transportation Services, Inc.'s ("Totran") Motion to Dismiss (Doc. 8) pursuant to Federal Rule of Civil Procedure 12(b)(2) and Memorandum in Support (Doc. 9), BNSF Logistics, LLC's ("BNSF") Response in Opposition (Doc. 24), and Totran's Reply (Doc. 30). For the reasons set forth below, the Motion is DENIED.

         I. BACKGROUND

         Plaintiff BNSF is a limited liability company organized in Delaware and maintains an office in Springdale, Arkansas. Defendant Totran, a heavy-haul specialized motor carrier, is a Texas corporation headquartered in Conroe, Texas. On May 12, 2009, BNSF and Totran entered into a Broker/Carrier Agreement ("2009 Agreement") (Doc. 24-1) that stated that BNSF, as broker, was authorized by its customers to negotiate and arrange for the transportation of customer shipments in interstate commerce, and that Totran, as carrier, agreed to transport these shipments. Paragraph 8 of the Agreement contained a forum-selection and choice-of-law clause that read: "Arkansas law, venue and jurisdiction shall apply." Id. at 2.

         It appears that over the next nine years, the parties continued their broker/carrier relationship without major incident. Then, on June 29, 2018, they entered into a Scope of Work Agreement ("SOW") (Doc. 24-2) in which Totran agreed to transport wind turbine equipment from Wellington, Kansas, to sites in and around Tampa, Kansas. In exchange, BNSF agreed to pay Totran for its transportation services. The first paragraph of the SOW specifically referenced the parties' 2009 Agreement and clarified that the terms and conditions of the SOW would only prevail over those in the Agreement if there were an "inconsistency or conflict between such documents." Id. at 1. Otherwise, the terms of the Agreement would apply.[1]

         According to the Amended Complaint (Doc. 4), from approximately June 2018 to November 2018, Totran transported turbine equipment pursuant to the SOW. But shortly after that, a dispute arose between the parties regarding the amount Totran believed it was owed under the SOW. The Complaint alleges that in February of 2019, Totran filed a notice of intent to file a mechanic's lien in state court in Kansas. Totran then served the notice on BNSF's customer, who was the lessee of the property that was subject to the lien. When BNSF found out what Totran had done, it asked Totran to withdraw the lien, and Totran refused. This lawsuit-in which BNSF asserts claims against Totran for breach of contract, defamation/slander, and tortious interference- resulted.

         Totran's motion to dismiss now before the Court asserts that the forum-selection clause in the parties' 2009 Agreement is insufficient, in and of itself, to establish personal jurisdiction over Totran, and that BNSF must also establish Totran's minimum contacts with the forum. In the alternative, Totran argues that the forum-selection clause in the Agreement-if sufficient to confer personal jurisdiction-is merely permissive in nature, rather than exclusive, and that Arkansas is not the only place where suit may be brought.[2] In response, BNSF points out that Totran consented to personal jurisdiction in Arkansas when Totran agreed to the forum-selection clause in the 2009 Agreement. Below, the Court will consider the parties' arguments.


         "To allege personal jurisdiction, a 'plaintiff must state sufficient facts in the complaint to support a reasonable inference that the defendant can be subjected to jurisdiction within the state.'" Wells Dairy, Inc. v. Food Movers Int'l, 607 F.3d 515, 518 (8th Cir. 2010) (quoting Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir. 2004)) (alteration omitted). "[I]n considering a motion to dismiss, the district court may sometimes consider materials outside the pleadings, such as materials that are necessarily embraced by the pleadings and exhibits attached to the complaint." Mattes v. ABC Plastics, Inc., 323 F.3d 695, 698 n.4 (8th Cir. 2003). The Court "must view the evidence in the light most favorable to the plaintiff and resolve all factual conflicts in the plaintiffs favor." Digi-Tel Holdings, Inc. v. Proteq Telecomm. (PTE), Ltd., 89 F.3d 519, 522 (8th Cir. 1996).

         The Arkansas long-arm statute authorizes the exercise of personal jurisdiction to the maximum extent permitted by the Due Process Clause of the Fourteenth Amendment. Ark. Code Ann. § 16-4-101(B); see also Epps v. Stewart Info. Serv. Corp., 327 F.3d 642, 647 (8th Cir. 2003). "An individual who subjects himself to the personal jurisdiction of a court by express agreement shall be bound by that contract, if the agreement can be determined to be fair and reasonable." Servewell Plumbing, LLC v. Summit Contrs., Inc., 362 Ark. 598, 606 (2005). "Forum selection clauses are prima facie valid and are enforced unless they are unjust or unreasonable or invalid for reasons such as fraud or overreaching. They are enforceable unless they would actually deprive the opposing party of his fair day in court." MB. Rests., Inc. v. CKE Rests., Inc., 183 F.3d 750, 752 (8th Cir. 1999) (internal citation omitted).


         A. Personal Jurisdiction over Totran

         Totran, a citizen of Texas, believes the Court cannot exert personal jurisdiction over it because the company lacks minimum contacts with Arkansas. Totran concedes, however, that it entered into an Agreement in 2009 with BNSF, a company that maintains an office in Springdale, Arkansas, and that it maintained a contractual relationship with BNSF, governed by the terms of that 2009 Agreement, for the next approximately nine years.

         As previously explained, Arkansas' long-arm statute allows the exercise of personal jurisdiction over a nonresident defendant, provided that such exercise does not offend the Due Process clause of the Fourteenth Amendment of the United States Constitution. Ark. Code Ann. § 16-4-101(B). The Eighth Circuit has clearly held that "[d]ue process is satisfied when a defendant consents to personal jurisdiction by entering into a contract that contains a valid forum selection clause." Dominium Austin Partners, LLC. v. Emerson,248 F.3d 720, 726 (8th Cir. 2001). Further, the Supreme Court of the United States has ruled that "[w]here such forum-selection provisions have been obtained through 'freely negotiated' agreements and are not 'unreasonable and unjust,' their enforcement does not offend due process." See Burger King Corp. v. Rudzewicz,471 U.S. 462, 473 n.14, (1985). Thus, ...

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