Carrier's Choice: Allowing a Defendant to Transfer Venue Through Bill of Lading
This article was written and published for The Current Loyola Maritime Law Journal.
Travelers Prop. Cas. Co. of Am. v. Expeditors Int’l of Wash., Inc., No.2L21-cv-01184-JHC, 2022 WL 4109101 (W.D. Wash. Sep. 8, 2022).
Travelers Prop. Cas. Co. of Am. v. Expeditors Int’l Wash., Inc, No.2:21-cv-01184-JHC, 2022 U.S. Dist. LEXIS 162235, (W.D. Wash. Sep. 8 2022).
Travelers Property Casualty Company, the Plaintiff, insured Signal Products against damage or loss sustained to Signal’s cargo while on voyage.1 Expeditors, a non-vessel operating common carrier, contracted to carry Signal’s cargo from Cambodia to California through a Sea Waybill contract.2 Under the Sea waybill the Merchant irrevocably consented to non-exclusive jurisdiction and venue in the Western District of Washington or the Superior Court of Washington sitting in King County for claims arising under the contract.3 The contract also contained a mandatory venue transfer provision.4 Under the Sea Waybill, the merchant consented to a transfer of venue to any venue where the carrier is a party to a legal action brought by itself or a third party that arises from or is connected with the goods.5 Through this contract the merchant waived all defenses based on inconvenience of forum.6
During the voyage to California, some of Signal’s cargo fell overboard and another portion was damaged.7 Travelers filed suit against Expeditors for the value of the cargo.8 Two months later, Expeditor filed suit against the carrier vessel in the Southern District of New York (SDNY) on claims that the carrier was the party responsible for the cargo loss.9 The SDNY consolidated three cases against the carrier for goods lost from a single incident of bad weather in the Pacific, including Expeditors.10
Expeditors moved to transfer Travelers’s suit against it to the SDNY under the forum selection clause contained in the Sea Waybill.11 Travelers argued that the transfer was improper because (1) the defendant waived its right to transfer because of the delay in filing the motion, (2) The Sea Waybill does not contain a valid forum selection clause, and (3) the transfer does not satisfy the requirements of the forum non conveniens statute, 28 U.S.C. § 1404(a).12
The court found that the defendants had not waived their right to enforce the forum selection clause because they had not substantially invoked the judicial process as they had not filed any substantive motions.13 Instead, they notified the court through a Joint Status Report and Proposed Discovery Plan.14 The Plaintiffs also contended that the forum selection clause is not valid because it does not identify a particular forum under its mandatory transfer provision.15 The court disagreed as the terms in the bill are not ambiguous but clearly mandates transfer to a venue where the defendant brings or defends a related action.16
Under 28 U.S.C. § 1404(a), a district court may transfer any civil action to (1) another district court where the parties have consented and (2) the transfer is for the convenience of the parties and witnesses and in the interest of justice.17 When a contract contains a valid forum selection clause, the court may only deny transfer under extraordinary circumstances unrelated to the convenience of the parties.18 Here, it is clear the Plaintiffs consented to transfer through the contract.19 When the transfer is based on a valid forum selection clause, the court may only consider public interest factors when analyzing the second requirement of 1404(a).20 Although local interests would favor the suit to stay in Washington where the Defendant’s headquarters are located, this is irrelevant as it is the party seeking the transfer.21 The only factor that weighed against transfer was the interest in ensuring a speedy trial, as there was already a trial date set in Seattle.22 However, the transfer to the SDNY would promote judicial efficiency as there were already related cases pending in the forum.23 After weighing these factors the court concluded that the forum selection clause contained in the Sea Waybill allowed the defendants to transfer the case pending against them to another forum where they had brought a related matter.24
1 Travelers Property Casualty Co. of Am. v. Expeditors Int Wash., Inc., No.2L21-cv-01184-JHC, 2022 WL 4109101 at *1 (W.D. Wash. Sep. 8, 2022).
2 Id.
3 Id.
4 Id.
5 Id.
6 Id.
7 Id. at. *2.
8 Id.
9 Id.
10 Id.
11 Id.
12 Id.
13 Id. at *3.
14 Id.
15 Id.
16 Id. at *4.
17 28 U.S.C. § 1404(a).
18 Travelers, 2022 WL 4109101, at *3.
19 Id. at *4.
20 Id.
21 Id. at *5.
22 Id.
23 Id.
24 Id.
