Antitrust Law Daily Wrap Up, FRANCHISING & DISTRIBUTION—W.D. Wis.: Forum selection clause mandated transfer of Wisconsin Fair Dealership Law action, (Feb 18, 2016)

By Michael Menzhuber, J.D., LL.M.

A Florida court was the proper venue for an action that alleged a violation of the Wisconsin Fair Dealership Law (WFDL), according to the federal district court in Madison, Wisconsin. The court found that the forum selection clause in the parties’ agreement required that all disputes be litigated in Florida and there were no “exceptional circumstances” that disfavored the transfer (Brava Salon Specialists, LLC v. Label.M USA, Inc., February 17, 2016, Crabb, B.).

Brava Salon Specialists, LLC filed an action in state court against Label.M USA, Inc., SalonCentric, Inc., and two “John Doe” defendants for violations of the WFDL. The bases for the action were Label.M’s alleged violation of an exclusive distribution agreement and SalonCentric, Inc.’s alleged interference with Brava’s contract with Label.M.

After removing the case to federal court, Label.M filed a motion to transfer the case to the Southern District of Florida because Brava’s claims arose under an agreement that required the parties to litigate their disputes in Florida. Since Brava did not deny that the forum selection clause applied to the dispute, and did not point to any extraordinary circumstances barring transfer, the court granted Label.M’s motion to transfer.

The court noted that when the parties have a valid forum selection clause: (1) it may not give any weight to the plaintiff’s choice of forum; (2) it may not consider the parties’ “private interests” such as convenience; and (3) the valid forum selection clause should be given controlling weight in all but the most exceptional circumstances.

The court determined that there were no exceptional circumstances. Brava’s contention that enforcing the forum selection clause would conflict with the strong public policy behind the WFDL was rejected, since Brava did not develop any argument as to why this would occur. While the Wisconsin court would be more familiar with the WFDL, Brava did not identify any “exceptionally arcane” features of the law that would defy comprehension by a federal judge sitting in Florida.

The forum selection clause was part of an agreement between Brava and Label.M, but not SalonCentric. However, the court determined that the entire case should be transferred to Florida because (1) neither Brava nor Label requested the court to sever the case so that the claims against SalonCentric could remain in the Wisconsin court; and (2) Brava’s claims against SalonCentric related to its relationship with Label.M.

The case is No. 15-cv-631-bbc.

Attorneys: Jonathan Patrick Bruni (Neider & Boucher, S.C.) for Brava Salon Specialists, LLC. Douglas Maynard Poland (Rathje & Woodward, LLC) and David A. Coulson (Greenberg Traurig, P.A.) for Label.M USA, Inc. and SalonCentric, Inc.

Companies: Label.M USA, Inc.; Saloncentric, Inc.

Cases: FranchisingDistribution WisconsinNews