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Espie v. Washington National Insurance Co.

United States District Court, M.D. Alabama, Northern Division

June 27, 2014

DANIEL ESPIE, Plaintiff,


MYRON H. THOMPSON, District Judge.

Plaintiff Daniel Espie brought this action against defendants Washington National Insurance Company and Caine & Weiner Company, LLC, asserting state-law claims of breach of contract and fraud. Subject-matter jurisdiction is proper under 28 U.S.C. § 1332 (diversity).

The case is now before this court on the defendants' motions to dismiss pursuant to Fed.R.Civ.P. 12(b)(3) or transfer pursuant to 28 U.S.C. § 1404(a), based on a forum-selection clause. The court finds that the clause applies to the claims in this case, but those motions will nonetheless be denied. However, Washington National raised an additional basis for dismissal, the doctrine of forum non conveniens, in a footnote in its reply brief. The court will therefore treat the reply brief as a separate motion to dismiss, and will give Caine & Weiner an opportunity to join and Espie an opportunity to respond.


In considering a defendant's motion to dismiss for improper venue under Fed.R.Civ.P. 12(b)(3), the court accepts the plaintiff's allegations as true "only to the extent they are uncontroverted by defendant[s] affidavits.'" Estate of Myhra v. Royal Caribbean Cruises, Ltd. , 695 F.3d 1233, 1239 (11th Cir. 2012) (quoting Home Ins. Co. v. Thomas Indus., Inc. , 896 F.2d 1352, 1355 (11th Cir. 1990)). "Rule 12(b)(3) is a somewhat unique context of dismissal in which [courts] consciously look beyond the mere allegations of a complaint, and, although [courts] continue to favor the plaintiff's facts in the context of any actual evidentiary dispute, [courts] do not view the allegations of the complaint as the exclusive basis for decision." Id.

In considering a defendant's motion to transfer venue pursuant to 28 U.S.C. § 1404(a), the court has "broad discretion in weighing the conflicting arguments as to venue, " England v. ITT Thompson Industries, Inc. , 856 F.2d 1518, 1520 (11th Cir. 1988); it must engage in an "individualized, case-by-case consideration of convenience and fairness." Stewart Organization, Inc. v. Ricoh Corp. , 487 U.S. 22, 29 (1988) (internal quotation marks omitted); see also C.M.B. Foods, Inc. v. Corral of Middle Georgia , 396 F.Supp.2d 1283, 1286 (M.D. Ala. 2005) (Thompson, J.).


Plaintiff Daniel Espie is an insurance agent. During the relevant time period, he worked as a regional manager for a company which, in turn, acted as an independent marketing organization for defendant Washington National Insurance Company.

Espie and Washington National entered into a "Sales Representative Agreement." See Affidavit of Christy Wilson (Doc. No. 6-1) at 9-19.[1] That agreement authorized Espie to sell Washington National insurance and set forth the terms of that relationship. It also contained a forum-selection clause: "Each party agrees to the exclusive jurisdiction of the courts of Hamilton County, Indiana, with respect to any claim or cause of action, whether in law or in equity, including specific performance, arising under or relating to this agreement...." Id. at 16.

Espie and Washington National also entered into a separate "Advance Compensation Agreement." See id. at 5-7; see also id. at 14-15 (Sales Representative Agreement addressing advance compensation). The Advance Compensation Agreement provided that, when Espie sold an insurance policy to a customer, Washington National would pay Espie's commission in advance, before the company had collected premiums from the customer. It also provided that, should the insurance policies Espie had sold lapse or be terminated before Washington National had recovered the sum advanced to Espie, or should Washington National's agreement with Espie be terminated, then Espie would owe Washington National the outstanding sum that had been advanced to him.

The Advance Compensation agreement explicitly indicated Espie's desire to "modify" the Sales Representative Agreement "in order to permit [him] to receive compensation in advance of premiums being collected" by Washington National. Id. at 5. However, it provided that, other than specific modifications it made, "[a]ll the terms, conditions and definitions of the [Sales Representative Agreement]... shall remain in force and effect..." Id. at 7. The unmodified terms remaining in effect therefore included the forum-selection clause. Because the Advance Compensation Agreement modified some terms of the Sales Representative Agreement, but reaffirmed all others including the forum-selection clause, the court will treat the two as a single contract for the purposes of this opinion. When the court refers to the "Sales Representative Agreement" in the remainder of this opinion, it is referring that agreement as modified by the Advance Compensation Agreement.

Under this advance-compensation agreement, Espie came to owe Washington National $29, 019.04 in the form of previously advanced commissions, referred to as "charge-backs." Complaint (Doc. No. 1) at ¶ 7. Washington National retained defendant Caine & Weiner Company, LLC, to collect the debt owed by Espie.

Espie negotiated with Caine & Weiner, ultimately reaching an agreement regarding the outstanding debt. Under that agreement, which was memorialized in a letter Caine & Weiner sent to Espie dated July 31, 2013, Espie would pay $10, 250.00 immediately and $100 per month thereafter until the debt was satisfied. See Letter Dated July 31, 2013 (Doc. No. 1-1).

In exchange, Caine & Weiner represented that Washington National would not report Espie's debt to VectorOne. See id.; Complaint (Doc. No. 1) at ¶ 11. VectorOne, or Vector, is a computer service which includes information about debts that insurance agents owe to insurance companies. According to the complaint, insurance companies rely on that information when deciding whether to contract with particular agents. Caine & Weiner also represented that Espie's debt would not be made part of Espie's credit report. See Letter Dated July 31, 2013 (Doc. No. 1-1). The letter does not include any forum-selection clause.

Espie paid as he had agreed. However, he alleges, the defendants breached the agreement by reporting his debt to VectorOne as well as two consumer credit reporting agencies. As a result, his contract with one insurance company was cancelled, and the terms of his contract with another company were adversely modified.

Espie then brought this suit, asserting six state-law claims: one count of breach of contract, and five counts of various kinds of fraud. The basic assertions underlying all six counts are the same: that the defendants promised not to report Espie's debts, but did so anyway.

The defendants moved to dismiss, arguing that the forum-selection clause of the Sales Representative Agreement requires that this case be heard in Indiana. After Espie amended his complaint, the defendants renewed their motions on this same basis.[2]


A. Scope of the ...

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