# Citadel Recovery Services, LLC v. T.J. Sutton Enterprises, LLC

> District Court, E.D. Louisiana · November 5, 2019

URL: https://www.frixlaw.com/law-library/cases/10184979

## Case

- **Court:** District Court, E.D. Louisiana
- **Decided:** November 5, 2019
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10184979

## How later opinions describe it (automated extraction)

- noting that only the Due Process Clause analysis is necessary

## Opinion text

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

CITADEL RECOVERY SERVICES, LLC CIVIL ACTION

VERSUS NO. 19-12271

T.J. SUTTON ENTERPRISES, LLC SECTION: “G”(4)

ORDER AND REASONS
In this litigation, Plaintiff Citadel Recovery Services, LLC (“Plaintiff”) alleges Defendant
T.J. Sutton Enterprises, LLC (“Sutton”) breached the parties’ contract by filing construction liens
on residential buildings in the United States Virgin Islands that were repaired pursuant to the
contract.1 Before the Court is Sutton’s “Motion to Dismiss for Lack of Personal Jurisdiction and
Improper Venue.”2 Having considered the motion, the memoranda in support and in opposition,
the record, and the applicable law, the Court denies the instant motion.
I. Background
On August 22, 2019, Plaintiff filed a Complaint against Defendant Sutton in this Court.3
According to the Complaint, the United States Virgin Islands suffered catastrophic damages from
Hurricanes Irma and Maria in 2017.4 Plaintiff alleges, as part of the recovery efforts, the Virgin
Islands Housing Finance Authority (“VIHFA”) contracted with prime contractor AECOM
Carible, LLP (“AECOM”) as part of the Emergency Home Repair Virgin Islands program, a

1 Rec. Doc. 1.
2 Rec. Doc. 7
3 Rec. Doc. 1.
4 Id. at 1.
recovery program funded by the Federal Emergency Management Agency.5
AECOM subsequently contracted with Plaintiff (“Master Subcontract”) as a subcontractor
to help provide construction services in the recovery efforts.6 Plaintiff, to satisfy its obligations

to AECOM under the Master Subcontract, contracted with Sutton (“Subcontract”) to help provide
construction services for AECOM.7 The Subcontract is allegedly a “pay when paid” contract.8
Sutton allegedly provided labor, materials, and equipment valued at $159,165.95 under the
Subcontract.9 Plaintiff asserts that it submitted invoices to AECOM for payment, which included
invoices for all labor, materials, and equipment provided by Sutton.10 According to the
Complaint, Plaintiff has a “Subcontract Performance Bond” and “Subcontract Payment Bond” in
place with Travelers Casualty and Surety Company of American in the amount of $10,000,000
to ensure payment to all subcontractors of Plaintiff, including Sutton.11 Yet, because Sutton did
not receive payment toward the $159,165.95, Sutton allegedly filed construction liens against
repaired residential buildings in the Virgin Islands.12 Plaintiff contends Sutton’s construction
liens violate both the Subcontract and Virgin Island lien law.13

On September 9, 2019, Sutton filed the instant motion to dismiss, arguing this Court does

5 Id.
6 Id. at 2.
7 Id.
8 Id.
9 Id. at 8.
10 Id.
11 Id. at 12.
12 Id. at 9.
13 Id. at 11–17.
not have personal jurisdiction over Sutton.14 On September 17, 2019, Plaintiff filed an opposition
to the instant motion.15 On September 30, 2019, with leave of Court, Sutton filed a reply brief in
further support of the motion.16

II. Parties’ Arguments
A. Sutton’s Arguments in Support of the Motion to Dismiss
Sutton makes two principal arguments in support of the instant motion.17 Sutton first argues
it is not subject to personal jurisdiction in Louisiana.18 Next, Sutton argues that the Eastern
District of Louisiana is an improper venue for Plaintiff’s claims against Sutton.19 The Court will
summarize each argument in turn.
1. Whether Sutton is Subject to Personal Jurisdiction in Louisiana
Sutton argues that it has insufficient contacts with Louisiana to support the exercise of
specific or general jurisdiction.20 Sutton contends that general jurisdiction “arises when the
nonresident’s contacts with the forum are continuous and systematic.”21 The “continuous and

systematic” standard requires an entity’s contacts with a forum state to render that entity “at
home” in the forum state.22 Sutton argues Plaintiff cannot establish Sutton has continuous and

14 Rec. Doc. 7.
15 Rec. Doc. 8.
16 Rec. Doc. 11.
17 Rec. Doc. 7-1.
18 Id. at 6–7.
19 Id. at 13–14.
20 Id. at 6–7.
21 Id. at 6.
22 Id. at 7.
systematic contacts with Louisiana because Sutton is a limited liability company organized under
North Carolina law without any offices or employees in Louisiana.23
Sutton also argues that it has insufficient contacts with Louisiana to support the exercise of
specific jurisdiction.24 Sutton contends that specific jurisdiction arises when “the defendant

purposefully avails himself of conducting activities in the forum state” and the “cause of action
arises from or is related to those contacts or activities.”25 Sutton argues that standard is not
satisfied here for Plaintiff’s three causes of action against Sutton, which Plaintiff refers to as
Count I, Count II, and Count III in the Complaint.26 Sutton argues Count I alleges Sutton
wrongfully filed liens in the Virgin Islands for construction work performed exclusively in the
Virgin Islands.27 Thus, Sutton argues Count I does not involve any contacts in Louisiana, and
Plaintiff has not established that Sutton is subject to specific jurisdiction in Louisiana for the
claims alleged in Count I.28
Sutton argues Count II seeks a declaratory ruling regarding rights and obligations under the
Master Subcontract and Subcontract.29 Sutton concedes that the Subcontract has a forum selection

clause permitting venue and jurisdiction in the Eastern District of Louisiana.30 But Sutton
contends the forum selection clause governs disputes only concerning the Subcontract—not the

23 Id. at 8.
24 Id. at 9.
25 Id.
26 Id.
27 Id.
28 Id. at 10.
29 Id.
30 Id.
Master Subcontract—because the Master Subcontract itself has a forum selection clause requiring
certain disputes to be litigated in the Virgin Islands or Virginia.31 Thus, because Count II requests
a declaratory ruling regarding rights and obligations under both the Master Subcontract and the
Subcontract, Sutton concludes specific jurisdiction is not appropriate in Louisiana for Count II.32

Sutton argues Count III seeks injunctive relief because “the placement of liens in the Virgin
Islands is damaging [Plaintiff’s] reputation and goodwill.”33 Yet, according to Sutton, “there are
no allegations that the cause of action arises from or is related to any contacts in Louisiana.”34
Therefore, Sutton concludes Plaintiff has not established that specific jurisdiction is appropriate
in Louisiana for Count III.35
Finally, Sutton contends it would be unfair and unreasonable for this Court to exercise
personal jurisdiction over Sutton.36 Sutton points to multiple factors that weigh in favor of this
Court declining to exercise personal jurisdiction over Sutton.37 For example, Sutton contends it
would be greatly burdened if forced to litigate in this Court because Sutton “has no offices in
Louisiana, did not perform any work in Louisiana, and did not perfect any liens in Louisiana.”38

Sutton also contends Louisiana has no “interest in the outcome of this lawsuit” because the lawsuit

31 Id. at 10–11.
32 Id.
33 Id. at 10.
34 Id.
35 Id.
36 Id. at 12.
37 Id. at 13.
38 Id.
“involves recovery work in the U.S. Virgin Islands.”39 Lastly, Sutton points out that “the
witnesses and homeowners are present in [the Virgin Islands].”40
2. Whether Venue is Proper in the Eastern District of Louisiana

Sutton argues the Eastern District of Louisiana is an improper venue for Plaintiff’s claims
against Sutton.41 Sutton contends venue is appropriate “in a district where any defendant resides
or where a substantial part of the events or omissions giving rise to the claim occurred.”42 Sutton
argues it does not reside in Louisiana and no event or omission in this matter occurred in
Louisiana.43 Sutton concedes that the Subcontract’s forum selection clause includes a venue
provision stating venue is proper in the Eastern District of Louisiana.44 But Sutton argues
Plaintiff’s claims do not fall within the scope of the Subcontract’s forum selection clause and, as
a result, the Subcontract’s venue provision is inapplicable to this case.45
B. Plaintiff’s Opposition to the Motion to Dismiss
Plaintiff makes two principal arguments in opposition to the instant motion. Plaintiff first

argues this Court may exercise personal jurisdiction over Sutton because the Subcontract—signed
by Plaintiff and Sutton—includes a valid and enforceable forum selection clause stating that
Sutton submits to the jurisdiction of the Eastern District of Louisiana.46 Next, Plaintiff argues

39 Id.
40 Id.
41 Id. at 13–14.
42 Id.
43 Id.
44 See id. at 14.
45 Id.
46 Rec. Doc. 8 at 6.
venue is appropriate in this Court because that same forum selection clause states that Sutton
submits to venue in the Eastern District of Louisiana.47 The Court will summarize each argument
in turn.

1. Whether Sutton is Subject to Personal Jurisdiction in Louisiana
Plaintiff points out that the Subcontract includes a forum selection clause that provides the
following:
This Agreement shall be governed by the law of the State of Louisiana. Subcontractor
[Sutton] submits to the venue and jurisdiction of the Eastern District Court of
Louisiana.48

Plaintiff argues the forum selection clause clearly and plainly articulates that Sutton, as the
Subcontractor, submits to this Court’s jurisdiction.49 Plaintiff further argues that, when a forum
selection clause’s meaning is plain, as here, the clause is presumptively valid and enforceable
unless enforcement of the clause would be “unreasonable.”50
Plaintiff contends Sutton may prove that enforcement of the forum selection clause would
be “unreasonable” only by establishing one of the following: “(1) the inclusion of the forum-
selection clause into the written contract was the product of fraud or overreaching; (2) the party
opposing enforcement of the clause will for all practical purposes be deprived of his day in court
because of the extreme inconvenience or unfairness of the forum specified in the clause; (3) the
law specified in the clause is fundamentally unfair and will cause plaintiff to be deprived of a
remedy; or (4) enforcement of the clause would go against a strong public policy of the forum

47 Id. at 19.
48 Rec. Doc. 8 at 4.
49 Id. at 8.
50 Id. at 10.
state.”51
First, Plaintiff argues Sutton does not allege fraud or overreaching by Plaintiff.52 Second,
Plaintiff argues requiring Sutton to litigate in Louisiana will not deprive Sutton of its day in court
or a proper remedy.53 Plaintiff points to Sutton promptly retaining legal counsel in Louisiana to

defend against Plaintiff’s claims.54 Finally, Plaintiff argues Sutton does not explain how enforcing
the clause would “go against a strong public policy” of Louisiana.55 Plaintiff thus concludes
enforcement of the Subcontract’s forum selection clause would not be unreasonable.56
Next, Plaintiff argues the Subcontract’s enforceable forum selection clause governs
Plaintiff’s three causes of action, which Plaintiff refers to as Count I, Count II, and Count III in
the Complaint, because each count flows directly from the Subcontract.57 According to Plaintiff,
Count I alleges “Sutton’s actions violate certain aspects of Virgin Island lien laws as they relate
to Sutton’s limitations under the Subcontract.”58 Plaintiff argues Count I concerns the
Subcontract’s lien limitations, flows directly from the Subcontract, and therefore falls within the

Subcontract’s forum selection clause.
Plaintiff argues Count II alleges “a genuine and bona fide dispute and an actual controversy

51 Id. (citing Haynsworth v. The Corp., 121 F.3d 956, 963 (5th Cir. 1997) (internal quotations marks
omitted)).
52 Id. at 11.
53 Id.
54 Id.
55 Id.
56 Id.
57 Id. at 12.
58 Id. at 13.
and disagreement [exists] between [Plaintiff] and Sutton regarding the payment terms under the
Subcontract and the rights and remedies available, if any, to Sutton for nonpayment.”59 Plaintiff
argues Count II concerns rights and remedies under the Subcontract, flows directly from the
Subcontract, and therefore falls within the Subcontract’s forum selection clause.60

Plaintiff argues Count III “seeks to enjoin Sutton from taking certain legal actions [that] are
not permitted under the Subcontract.”61 As a result, Plaintiff argues Count III’s request for
injunctive relief flows directly from the Subcontract and therefore must fall within the
Subcontract’s forum selection clause.62
2. Whether Venue is Appropriate in the Eastern District of Louisiana
Plaintiff argues venue is appropriate in this Court because the Subcontract’s forum selection
clause states that Sutton “submits to the venue . . . of the Eastern District Court of Louisiana.”63
Plaintiff argues Counts I, II, and III are subject to the Subcontract’s venue provision because each
count is within the scope of the Subcontract’s forum selection clause for the same reasons argued
above in the personal jurisdiction subsection.64

C. Sutton’s Reply to Plaintiff’s Opposition
In reply, Sutton further elaborates why it believes this Court lacks personal jurisdiction over
it with respect to the claims raised in Counts I, Count II, and Count III.65 According to Sutton,

59 Id. (citing Rec. Doc. 1).
60 Id.
61 Id.
62 Id. at 14–15.
63 See id. at 19.
64 Id.
65 Rec. Doc. 11.
“[a] plaintiff bringing multiple claims that arise out of different forum contacts of the defendant
must establish specific jurisdiction for each claim.”66 Sutton argues Plaintiff cannot establish
personal jurisdiction over Sutton for each claim because each claim does not involve sufficient

contacts with Louisiana and each claim is not within the scope of the Subcontract’s forum
selection clause.67
Sutton argues Count I and Count III pertain to actions that occurred solely in the Virgin
Islands and therefore do not involve sufficient contacts with Louisiana for this Court to exercise
specific jurisdiction.68 Sutton also argues Count I and Count III are not within the scope of the
Subcontract’s forum selection clause because the clause “does not state that TJ Sutton consents
to venue and jurisdiction in this Court for any and all claims that may arise under the contract or
the performance of work under the contract.”69 Put another way, Sutton argues Plaintiff is
incorrectly interpreting the Subcontract’s forum selection clause “to argue that personal
jurisdiction lies in Louisiana for anything TJ Sutton did under the [Sub]contract.”70

Next, Sutton argues Count II seeks relief under the Master Subcontract in addition to relief
under the Subcontract.71 The Master Subcontract itself allegedly includes a forum selection clause
requiring disputes to be litigated in the Virgin Islands or Virginia.72 According to Sutton, because
the Subcontract adopts the Master Subcontract, Plaintiff is bound by the Master Subcontract’s

66 Id. at 1.
67 Id. at 2.
68 Id.
69 Id. at 4.
70 Id. at 3.
71 Id.
72 Id. at 4.
forum selection clause requiring disputes to be litigated in Virginia or the Virgin Islands.73 Sutton
concedes the Subcontract controls when in conflict with the Master Subcontract, but Sutton
argues no conflict exists between the Subcontract’s forum selection clause and the Master
Subcontract’s forum selection clause.74 Sutton concludes that the Master Subcontract’s forum

selection clause controls in this case.
III. Legal Standard
A. Legal Standard on a Motion to Dismiss for Lack of Personal Jurisdiction
Federal Rule of Civil Procedure 12(b)(2) permits a court to dismiss a plaintiff’s claims
when the court does not have personal jurisdiction over a defendant. The party seeking to invoke
the power of the court “bears the burden of establishing jurisdiction, but need only present prima
facie evidence.”75 To determine whether a prima facie case exists, a district court accepts
“uncontroverted allegations in the complaint” as true and resolves “any factual disputes” in favor
of the party seeking to invoke the court’s jurisdiction.76 A district court has “considerable

procedural leeway” on how it resolves a pretrial motion to dismiss for lack of personal
jurisdiction.77 Indeed, a district court “may determine the motion on the basis of affidavits alone;
or it may permit discovery in aid of the motion; or it may conduct an evidentiary hearing on the
merits of the motion.”78

73 Id.
74 Id. at 5.
75 Revell v. Lidov, 317 F.3d 467, 469 (5th Cir. 2002) (citations omitted).
76 Ainsworth v. Moffett Eng’g, Ltd., 716 F.3d 174, 176 (5th Cir. 2013) (quoting ITL Int’l, Inc. v. Constenla,
S.A., 669 F.3d 493, 496 (5th Cir. 2012)).
77 Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (5th Cir. 1981).
78 Id.
In diversity cases under 28 U.S.C. § 1332, “the exercise of personal jurisdiction over a non-
resident defendant must comport with both federal constitutional due process requirements and
the long-arm statute of the state in which the district court is located.”79 The Louisiana long-arm
statute confers jurisdiction to the limits of due process.80 Thus, because Louisiana’s long-arm

statute confers jurisdiction to the limits of due process, a federal court must determine only
whether subjecting the defendant to suit in Louisiana comports with the Due Process Clause.81
Due process permits the exercise of personal jurisdiction over a nonresident defendant when
(1) the defendant “purposefully availed himself of the benefits and protections of the forum state
by establishing ‘minimum contacts’ with the forum state”82 and (2) the court’s exercise of
personal jurisdiction does not “offend traditional notions of fair play and substantial justice.”83
The “minimum contacts” analysis “may result in either specific or general jurisdiction.”84
“General jurisdiction may be asserted when a defendant’s contacts with the forum state are
substantial and ‘continuous and systematic’ but unrelated to the instant cause of action.”85 On the

other hand, specific jurisdiction may be asserted when the nonresident defendant has
“purposefully directed its activities at the forum state and the litigation results from alleged

79 Companion Prop. & Cas. Ins. Co. v. Palermo, 723 F.3d 557, 559 (5th Cir. 2013).
80 La. Rev. Stat. § 13:3201.
81 Dickson Marine Inc. v. Panalpina, Inc., 179 F.3d 331, 336 (5th Cir. 1999) (noting that only the Due
Process Clause analysis is necessary).
82 Cent. Freight Lines Inc. v. APA Transp. Corp., 322 F.3d 376, 380 (5th Cir. 2003) (quoting Int’l Shoe Co.
v. Washington, 326 U.S. 310, 319 (1945)).
83 Pervasive Software, Inc. v. Lexware GmbH & Co. Kg., 688 F.3d 214, 220 (5th Cir. 2012).
84 Torgeson v. Nordisk Aviation Prod., Inc., 997 F.2d 881 (5th Cir. 1993).
85 Cent. Freight Lines, 322 F.3d at 381.
injuries that arise out of or relate to those activities.”86
B. Legal Standard on a Motion to Dismiss for Improper Venue
A motion to dismiss for improper venue pursuant to Federal Rule of Civil Procedure

12(b)(3) requires a district court to determine whether venue is supported by the federal venue
statute, 28 U.S.C. § 1391.87 Once a defendant has raised the improper venue issue by motion, the
plaintiff bears the burden to establish that the chosen district is the proper venue.88 When ruling
on a Rule 12(b)(3) motion for improper venue, “the court must accept as true all allegations in
the complaint and resolve all conflicts in favor of the plaintiff.”89 Rule 12(b)(3) permits the Court
to look at all evidence in the record beyond simply those facts alleged in the complaint and its
proper attachments.90
IV. Analysis
In the instant motion, Sutton argues that this case should be dismissed because it is not
subject to personal jurisdiction in Louisiana and because the Eastern District of Louisiana is an
improper venue for Plaintiff’s claims against Sutton.91 In opposition, Plaintiff argues Sutton freely

consented to personal jurisdiction and venue in this Court by agreeing to the Subcontract’s forum

86 Id. (quoting Burger King Corp., 471 U.S. at 472).
87 Atl. Marine Const. Co., Inc. v. U.S. Dist. Court for W. Dist. of Tex., 134 S.Ct. 568, 577 (2013). Under 28
U.S.C. § 1391(b), a civil action may be brought in: (1) a judicial district where any defendant resides, if all
defendants are residents of the State where the district is located; (2) a judicial district in which a substantial
part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the
subject of the action is situated; or (3) if there is no district in which an action may otherwise be brought as
provided by 28 U.S.C. § 1391, a judicial district in which any defendant is subject to personal jurisdiction
at the time the action is commenced.
88 Perez v. Pan American Life Ins. Co., 70 F.3d 1268, 1995 WL 696803, at *2 (5th Cir. 1995).
89 Ginter ex rel. Ballard v. Belcher, Prendergast & Laporte, 536 F.3d 439, 448–49 (5th Cir. 2008).
90 Lighthouse MGA, LLC v. First Premium Ins. Grp., Inc., 448 Fed. App’x. 512, 514 (5th Cir. 2011).
91 Rec. Doc. 7-1.
selection clause.92 That clause states:
This Agreement shall be governed by the law of the State of Louisiana. Subcontractor
[Sutton] submits to the venue and jurisdiction of the Eastern District Court of
Louisiana.93

Under Fifth Circuit precedent, parties to a contract may consent to personal jurisdiction and venue
via a forum selection clause.94 “A forum selection provision in a written contract is prima facie
valid and enforceable unless the opposing party shows that enforcement would be
unreasonable.”95 To determine whether a forum selection clause requires the parties to litigate in
the clause’s specific forum, a court must first determine whether the forum selection clause is
mandatory or permissive.96
A. Whether the Subcontract’s Forum Selection Clause is Mandatory or Permissive
The Fifth Circuit has distinguished between mandatory and permissive forum selection
clauses. 97 A forum selection clause is mandatory “only if it contains clear language specifying
that litigation must occur in the specified forum.”98 Put another way, a mandatory forum selection
clause “must clearly demonstrate the parties’ intent to make that jurisdiction exclusive.”99 By
contrast, a permissive forum selection clause “is only a contractual waiver of personal jurisdiction

92 Rec. Doc. 8 at 6.
93 Rec. Doc. 8-2 at 10.
94 See, e.g., Kevlin Servs., Inc. v. Lexington State Bank, 46 F.3d 13, 15 (5th Cir. 1995).
95 Id.
96 Weber v. PACT XPP Techs., AG, 811 F.3d 758, 768 (5th Cir. 2016).
97 Id.
98 Id.
99 City of New Orleans v. Municipal Administrative Services, Inc., 376 F.3d 501, 504 (5th Cir. 2004)
(emphasis added).
and venue objections if litigation is commenced in the specified forum.”100
Fifth Circuit caselaw helps illustrate the distinction between mandatory and permissive
forum selection clauses. For instance, in Argyll Equities LLC v. Paolino, the Fifth Circuit deemed

mandatory a forum selection clause that provided the following: “Borrower hereby consents to
the exclusive jurisdiction of the courts sitting in Kendall County, Texas.”101 The Fifth Circuit
reasoned that an agreement to submit to “the exclusive jurisdiction of the courts sitting in Kendall
County” clearly demonstrated the parties’ intent to make that jurisdiction exclusive.102 By
contrast, in Caldas & Sons, Inc. v. Willingham, the Fifth Circuit deemed permissive a forum
selection clause that stated “[t]he law and courts of Zurich shall be applicable.”103 The Fifth
Circuit reasoned that the “only thing certain about the clause . . . is that the parties consented to
the personal jurisdiction of the Zurich courts.”104 “Beyond that, however, the language [does] not
clearly indicate that the parties intended to declare Zurich to be the exclusive forum for the
adjudication of disputes.”105

In this case, the Subcontract’s forum selection clause reads:
This Agreement shall be governed by the law of the State of Louisiana. Subcontractor
[Sutton] submits to the venue and jurisdiction of the Eastern District Court of
Louisiana.106

The Subcontract’s forum selection clause states only that Sutton “submits” to the venue and

100 Weber, 811 F.3d at 768.
101 Argyll Equities LLC v. Paolino, 211 F. App’x 317, 318 (5th Cir. 2006).
102 Id. at 319.
103 Caldas & Sons, Inc. v. Willingham, 17 F.3d 123, 127 (5th Cir. 1994).
104 Id. at 128.
105 Id. (emphasis added).
106 Rec. Doc. 8-2 at 10.
jurisdiction of this Court.107 It does not state, for example, that Sutton “exclusively submits” to
this Court’s jurisdiction. Simply put, the Subcontract’s forum selection lacks the “exclusive”
language required for a mandatory forum selection clause. This Court thus finds that the

Subcontract’s forum selection clause is permissive.
A permissive forum selection clause is “a contractual waiver of personal jurisdiction and
venue objections if litigation is commenced in the specified forum.”108 Plaintiff commenced
litigation in the Subcontract’s specified forum—the Eastern District of Louisiana. Therefore,
Sutton has contractually waived any personal jurisdiction or venue objections in this Court if the
Subcontract’s forum selection clause is enforceable and applies to Plaintiff’s claims against
Sutton.
B. Whether the Subcontract’s Forum Selection Clause is Valid and Enforceable
The Court must now determine whether the Subcontract’s forum selection clause is “valid
and enforceable.” In diversity cases, federal law applies when determining whether a forum
selection clause is valid and enforceable.109 Under federal law, a “forum-selection provision in a

written contract is prima facie valid and enforceable unless the opposing party shows that
enforcement would be unreasonable.”110
The party resisting enforcement on “unreasonable” grounds bears a “heavy burden of

107 Id.
108 Weber, 811 F.3d at 768.
109 Haynsworth v. The Corp., 121 F.3d 956, 962 (5th Cir. 1997) (citation omitted).
110 Kevlin Servs., 46 F.3d at 15. The Fifth Circuit has not drawn a “distinction between validity and
enforceability.” Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 302 (5th Cir. 2016). Instead, the Fifth
Circuit appears “to treat those words as synonyms in the forum-selection clause context.” Id.
proof.”111 Nonetheless, unreasonableness “potentially exists where (1) the incorporation of the
forum selection clause into the agreement was the product of fraud or overreaching; (2) the party
seeking to escape enforcement ‘will for all practical purposes be deprived of his day in court’

because of the grave inconvenience or unfairness of the selected forum; (3) the fundamental
unfairness of the chosen law will deprive the plaintiff of a remedy; or (4) enforcement of the
forum selection clause would contravene a strong public policy of the forum state.”112
Here, Sutton must satisfy a “heavy burden of proof” to show enforcement of the
Subcontract’s forum selection clause would be “unreasonable.” Sutton has not met its “heavy”
burden. First, Sutton does not contend the forum selection clause entailed “fraud or
overreaching.”113 Second, Sutton does not contend it will lose its “day in court” by litigating in
this Court.114 Although Sutton contends transferring this case to the Virgin Islands “would
drastically decrease the burden and litigation expense on all parties,” Sutton does not demonstrate
how those additional expenses will deprive Sutton of its “day in court.”115 Third, the factor

regarding Plaintiff’s remedies is not applicable to Defendant Sutton. Finally, Sutton does not
argue enforcement of the Subcontract’s forum selection clause contravenes a “strong public
policy” of the forum state.116 Accordingly, because Sutton did not satisfy its “heavy” burden to
show enforcement of the Subcontract’s forum selection clause would be unreasonable, the Court

111 Haynsworth, 121 F.3d at 963 (citing The Bremen v. Zapata Off–Shore Co., 407 U.S. 1, 17 (1972)).
112 Id. (citing Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 595 (1991)).
113 Rec. Doc. 7-1; Rec. Doc. 11.
114 Rec. Doc. 7-1; Rec. Doc. 11.
115 Rec. Doc. 11 at 6.
116 Rec. Doc. 7-1; Rec. Doc. 11.
finds that the clause is valid and enforceable.117
C. Whether the Subcontract’s Forum Selection Clause Applies to Plaintiff’s Counts
The Court must now determine whether the Subcontract’s forum selection clause applies to
Plaintiff’s three claims against Sutton.118 Sutton argues that the Subcontract’s forum selection

clause does not apply to Plaintiff’s claims because each claim does not relate to the
Subcontract.119 In opposition, Plaintiff argues that each claim flows directly from the Subcontract
and the Subcontract’s forum selection clause applies to every claim.120
To decide whether the Subcontract’s forum selection clause applies to each claim, the Court
“must look to the language of the parties’ contracts to determine which causes of action are
governed by the forum selection clause.”121 The scope of a forum selection clause is not limited

117 Instead of addressing the four factors, Sutton argues the four factors do not provide the appropriate
standard. Rec. Doc. 11 at 6. According to Sutton, the appropriate standard is whether the exercise of specific
jurisdiction over Sutton is fair and reasonable. Id. That argument is incorrect because the traditional specific-
jurisdiction analysis is unnecessary when a party, like Sutton, consents to personal jurisdiction and venue
in a forum selection clause. See Kevlin Servs., 46 F.3d at 15. Sutton does not argue that it did not consent to
the forum selection clause.
118 A “choice-of-law analysis to determine what substantive law should guide this court’s interpretation of
the [forum selection clause] is proper under ordinary principles governing diversity litigation.” Weber, 811
F.3d at 770. The Fifth Circuit has not followed that rule closely when interpreting forum selection clauses.
Id. Instead, the Fifth Circuit has “interpreted [forum selection clauses] according to general common-law
contract principles without addressing the precise source of law.” Id. The “use of this general-law approach
may be because, in this circuit and others, the enforceability of [a forum selection clause] is governed by
federal law.” Id. “But, as several circuits have explicitly recognized, the question of enforceability is
analytically distinct from the issue of interpretation.” Id.
Here, the Subcontract states: “This Agreement shall be governed by the law of the State of Louisiana.” The
parties do not raise the issue of whether Louisiana law applies when interpreting the Subcontract. “Under
Louisiana law, a contract is the law between the parties, and is read for its plain meaning.” In re Liljeberg
Enterprises, Inc., 304 F.3d 410, 439 (5th Cir. 2002) (quoting Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v.
Circle, Inc., 915 F.2d 986, 989 (5th Cir. 1990) (per curiam)). Sutton does not argue that this Court should
apply any law other than Louisiana law when interpreting the Subcontract. Moreover, the forum selection
clause is clear, and Sutton does not argue otherwise. Thus, this Court will give the Subcontract’s forum
selection clause its plain meaning.
119 Rec. Doc. 7-1 at 9–11.
120 Rec. Doc. 8 at 13–14.
121 Marinechance Shipping, Ltd. v. Sebastian, 143 F.3d 216, 222 (5th Cir. 1998); see also
Claimserviceprovider, Inc. v. St. Paul Travelers Companies Inc., No. 06-2475, 2006 WL 2989240, at *4
to claims for breach of the contract that contains the forum selection clause.122 Indeed, forum
selection clauses extending “to all disputes that ‘relate to’ or ‘are connected with’ the contract are
construed broadly.”123

For example, in Ginter Ballard v. Belcher, Prendergast & Laporte, a forum selection clause
provided the following: “Any action at law, suit in equity, or other judicial proceeding for the
enforcement and/or breach of this contract, or any provision thereof, shall be instituted only in
the 19th Judicial District Court of the State of Louisiana.”124 The Fifth Circuit broadly construed
the forum selection clause to include more than breach of contract claims.125 Indeed, the Fifth
Circuit held that the plaintiff’s tort theories fell within the scope of the forum selection clause—
despite the forum selection clause referring only to “suits dealing with the enforcement or breach
of contract”—because the tort theories were in essence complaining about the defendant’s failure
to fulfill certain contractual obligations.126
Similarly, in Carnival Cruise Lines, Inc. v. Shute, the United States Supreme Court

considered a forum selection clause that provided the following: “[A]ll disputes and matters
whatsoever arising under, in connection with or incident to this Contract shall be litigated, if at
all, in and before a Court located in the State of Florida.”127 With language such as “in connection

(E.D. La. Oct. 18, 2006).
122 Ginter ex rel. Ballard v. Belcher, Prendergast & Laporte, 536 F.3d 439, 445 (5th Cir. 2008).
123 Pinnacle Interior Elements, Ltd. v. Panalpina, No. 3:09–CV–0430–G, 2010 WL 445927, at *5 (N.D.
Tex. Feb. 9, 2010) (quoting Pennzoil Exploration and Production Company v. Ramco Energy Limited, 139
F.3d 1061, 1067 (5th Cir. 1998)).
124 Ginter ex rel. Ballard, 536 F.3d at 445.
125 Id.
126 Id.
127 Carnival, 499 U.S. at 587–88.
with” and “incident to this Contract,” the Supreme Court deemed the forum selection clause broad
enough to cover claims for breach of contract and negligence.128
In this case, the Court must review the language of the Subcontract’s forum selection clause

to determine whether Plaintiff’s claims fall within the clause’s scope. The Subcontract’s forum
selection clause states:
This Agreement shall be governed by the law of the State of Louisiana. Subcontractor
[Sutton] submits to the venue and jurisdiction of the Eastern District Court of
Louisiana.129

Like the forum selection clauses in Ginter and Carnival, the Subcontract’s forum selection clause
is not limited to claims for breach of contract. In fact, the Subcontract’s forum section clause is
broader than the clauses in Ginter and Carnival because it lacks any restrictive language
whatsoever. The clauses in Ginter and Carnival were restricted to claims “in connection with”130
the contract or, alternatively, claims involving “enforcement and/or breach of this contract.”131
Here, the forum selection clause broadly states that Sutton “submits to the venue and jurisdiction
of the Eastern District Court of Louisiana.”132 Because the Subcontract’s forum selection clause
is broader than the forum selection clauses in Carnival and Ginter, the Subcontract’s forum
selection clause must, at minimum, include breach of contract claims and tort claims relating to
the Subcontract. Therefore, even if Plaintiff’s claims sound in both contract and tort, the claims
may nonetheless fall within the scope of the Subcontract’s forum selection clause.

128 Id. at 587–89.
129 Rec. Doc. 8-2 at 10.
130 Carnival, 499 U.S. at 587.
131 Ginter ex rel. Ballard, 536 F.3d at 445.
132 Rec. Doc. 8-2 at 10.
In Count I, Plaintiff alleges Sutton violated the Subcontract and Virgin Island lien law
capping the amount of construction liens in particular contracts.133 Plaintiff alleges that under the
Subcontract “Sutton is entitled only to receive payment for costs to ‘furnish labor, non-bulk
materials, and equipment’ as contemplated by the Subcontract.”134 Plaintiff also alleges Sutton is

owed only $159,165.95 for the cost of labor and materials.135 Plaintiff thus concludes the
Subcontract limits Sutton’s potential claims to $159,165.95.136 Despite that limitation, Sutton
allegedly filed liens exceeding $1,600,000 in order to recover expenses that do not involve the
cost of labor and materials.137
Plaintiff explicitly states that “[t]he lien amounts filed by Sutton grossly exceed those limits
permitted under [Virgin Island law]” because the liens exceed the amounts to which Sutton is
entitled under the Subcontract.138 Therefore, because Plaintiff’s allegations in Count I relate to
the Subcontract, Count I falls within the scope of the Subcontract’s broad forum selection clause.
In Count II, Plaintiff alleges “a genuine and bona fide dispute and an actual controversy

and disagreement [exists] between Citadel and Sutton regarding the payment terms under the
Subcontract and the rights and remedies available, if any, to Sutton for nonpayment.”139 Count II
concerns rights and remedies under the Subcontract and is clearly related to the Subcontract.
Accordingly, Count II easily falls within the scope of the broad language in the Subcontract’s

133 Rec. Doc. 1 at 11–12.
134 Id. at 12.
135 Id.
136 Id.
137 Id.
138 Id. at 13.
139 Rec. Doc. 1 at 14.
forum selection clause.140
In Count III, Plaintiff seeks to enjoin Sutton from “(1) initiating any legal action to foreclose
on the construction liens, (2) bringing suit against the Bonds in place, and (3) placing additional
liens on EHRVI properties for which [Plaintiff] is responsible under the Master Subcontract.”141

The Court agrees with Plaintiff’s assertion that these three requests derive from the
Subcontract.142 Indeed, Plaintiff’s request to enjoin Sutton from “foreclose[ing] on the
construction liens” entails the same liens that purportedly breach the Subcontract. Moreover, the
Bonds in place are at issue only because Sutton allegedly has not been paid under the Subcontract.
Finally, Plaintiff’s request to enjoin Sutton from placing additional liens on properties for which
Plaintiff is responsible under the Master Subcontract is related to the Subcontract. The
Subcontract explicitly adopts the Master Subcontract. Therefore, Count III’s request for
injunctive relief easily falls within the scope of the broad language in the Subcontract’s forum
selection clause.143

140 Sutton argues that Count II seeks relief under the Master Subcontract, which includes a forum selection
clause requiring disputes relating to the Master Subcontract to be litigated in the State in which the project
is located (here, the Virgin Islands) or Virginia. Rec. Doc. 11 at 4. Sutton argues the Subcontract adopts the
Master Subcontract and, therefore, Plaintiff is bound by the Master Subcontract’s forum selection clause.
Id.
Sutton’s argument is not persuasive. The Subcontract includes a provision stating that the Subcontract
controls when in conflict with the Master Subcontract. Rec. Doc. 8-2 at 5. Under the Subcontract, Sutton
submitted to jurisdiction in the Eastern District of Louisiana. Id. at 10. Yet, under the Master Subcontract,
disputes relating to the Master Subcontract must be litigated in the Virgin Islands or Virginia. Rec. Doc. 7-
2 at 8. Here, Plaintiff’s claims involve both the Master Subcontract and the Subcontract. Because the
Subcontract permits jurisdiction in the Eastern District of Louisiana, and the Master Subcontract permits
jurisdiction only in the Virgin Islands and Virginia, the two forum selection clauses are in conflict.
Consequently, the Subcontract’s forum selection clause controls.
141 Rec. Doc. 1 at 16.
142 Rec. Doc. 8 at 14.
143 Sutton argues that the Subcontract’s forum selection clause “does not state that TJ Sutton consents to
venue and jurisdiction in this Court for any and all claims that may arise under the contract or the
performance of work under the contract.” Rec. Doc. 11 at 4. Therefore, according to Sutton, “there is nothing
in the provision that would place TJ Sutton on notice that a court in Louisiana may enjoin it from taking
V. Conclusion
For the foregoing reasons, the Court finds that Plaintiff has met its burden of establishing
that this Court may exercise personal jurisdiction over Sutton in the present matter and that venue
is appropriate in the Eastern District of Louisiana. Accordingly,
IT IS HEREBY ORDERED that the Sutton’s “Motion to Dismiss for Lack of Personal
Jurisdiction and Improper Venue” is DENIED.
NEW ORLEANS, LOUISIANA, this 4th_ day of November, 2019.

NANNETTE J Dob BROWN
CHIEF JUDGE
UNITED STATES DISTRICT COURT

action in the Virgin Islands to protect and preserve its rights.” Jd.
Sutton correctly states that the Subcontract’s forum selection clause does not have language encompassing
“any and all claims that may arise under the contract.” But Sutton’s point hurts its own argument. The
Subcontract’s forum selection clause is broader than a provision limited to “any and all claims that may
arise under the contract” because it lacks the exact language mentioned by Sutton. Indeed, the Subcontract
simply states that Sutton “submits to the venue and jurisdiction of the Eastern District Court of Louisiana,”
which is not necessarily limited to claims involving the Subcontract. Yet the Court need not decide precisely
how broad the Subcontract’s clause is because each claim, as demonstrated above, is at minimum related to
the Subcontract.
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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10184979. Public record. Not legal advice.