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Healthcare & Diagnostics Solutions Inc. v. Patient Care Pharmacy Corp.

United States District Court, S.D. Alabama, Southern Division

July 23, 2018

HEALTHCARE & DIAGNOSTIC SOLUTIONS, Inc., Plaintiff,
v.
PATIENT CARE PHARMACY CORPORATIONS; SUSAN ALEXANDER GUTHRIE; et al. Defendants.

          REPORT AND RECOMMENDATION

          KATHERINE P. NELSON, UNITED STATES MAGISTRATE JUDGE.

         This action is before the Court on Motion to Remand (Doc. 18) filed by Plaintiff Healthcare & Diagnostic Solutions, Inc., (“Healthcare”) to which the Defendants, Patient Care Pharmacy Corporations (“Patient Care”) and Susan Alexander Guthrie (“Guthrie”) have filed a response in opposition (Doc. 23), and Healthcare has filed a reply. (Doc. 24). This matter is now ripe for consideration and has been referred to the undersigned Magistrate Judge for entry of a report and recommendation under 28 U.S.C. § 636(b)(1)(B)-(C) and Federal Rule of Civil Procedure 72(b). Upon consideration, and for the reasons stated herein, the undersigned RECOMMENDS that Healthcare's Motion to Remand (Doc. 18) be DENIED.

         I. Procedural History

         On February 8, 2018, Healthcare filed a complaint in the Circuit Court of Baldwin County, Alabama, alleging a number of state-law causes of action against the Defendants arising from breach of contract, fraud, tort of outrage, open account, account stated and goods sold and delivered. (Doc. 1). In addition, Healthcare filed interrogatories and request for production with the Baldwin County Circuit Court. Patient Care and Guthrie responded by filing notice of removal.

         On April 2, 2018, Patient Care and Guthrie removed the case to this Court under 28 U.S.C. § 1332, 1441 and 1446, while preserving any and all defenses under Rule 12 of the Federal Rules of Civil Procedure. (Doc. 1). Patient Care and Guthrie contend removal is proper under §1441(a) and (b), because the Court has original jurisdiction over the case at bar based on diversity of citizenship.[1] In addition, this Court has original jurisdiction under 28 U.S.C. § 1332(a), which provides the district courts original jurisdiction of civil actions between citizens of different states where, the amount in controversy exceeds $75, 000, exclusive of interest and costs.

         Healthcare moves for remand under 28 U.S.C. § 1447(c) (Doc. 18) on the grounds, in sum, that the forum selection clause contained within the Customer Credit Application (“Application”), signed by Patient Care and Guthrie, limits the parties to the jurisdiction of Baldwin County.

         II. Analysis

         Pursuant to 28 U.S.C.A §1441, “Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.” Patient Care is incorporated in Louisiana, with its principal place of business in Louisiana. Guthrie is a citizen of Louisiana, residing in Louisiana. Healthcare is incorporated in Alabama, with its principal place of business in Alabama. Under §1441 and §1332 (a) the civil action is removable due to complete diversity among all parties.[2] Healthcare does not dispute the diversity of the parties or the amount in controversy. (Doc. 18 at 2-3).

         Prior to suit, Guthrie signed the application provided by Healthcare, in her capacity as president and CEO of Patient Care Pharmacy Corporation on May 21, 2009. (Doc.18). A forum selection clause (“FSC”) is contained within the application.

         The FSC states:

Applicant consents to the jurisdiction of the State of Alabama, County of Baldwin, and consents to reimburse H.D.S. for all reasonable costs and fees incurred in any pursuit, recovery, or collection action.

         Healthcare argues Patient Care expressly consented to the jurisdiction of Baldwin County after signing the application and cannot revoke consent by removing the case to federal court. (Doc.18). In addition, Healthcare represents that although the clause is permissive, it is mandatory upon initiation of the suit. (Doc.18).

         The Eleventh Circuit generally characterizes the language of forum selection clauses as either “permissive” or “mandatory”. See Global Satellite Comm. v. Starmill U.K. 378 F.3d 1269, 1272. “We need not decide whether the clause rises to the level of a clear and unequivocal waiver because we do not agree that such a high standard is required or desirable.” Id. “A permissive clause authorizes jurisdiction in a designated forum but does not prohibit litigation elsewhere. A mandatory clause, in contrast, ‘dictates an exclusive forum for litigation under the contract.'” Snapper v. Redan, 171 F.3d at 1262

         “Forum selection clause may be “permissive, ” by authorizing jurisdiction in a designated forum but does not prohibit litigation elsewhere… or a “hybrid” form, that provides for permissive jurisdiction in one forum, which becomes mandatory upon the party sued.” Ocwen Orlando Holdings v. Harvard Prop. Trust,526 F.3d 1379, 1380 (11th Cir. 2008). In Ocwen, the court held a hybrid forum selection clause permits either party to commence suit in a state trial court, and that upon commencement of such suit the other party waived right to “transfer” action to ...


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