United States District Court, D. Maryland, Southern Division
MEMORANDUM OPINION AND ORDER
W. Grimm United States District Judge.
Choice Hotels, International, Inc. (“Choice”)
brings the instant Application to confirm an arbitration
award granted to remedy Plaintiff Jitendra Patel's
alleged violation of a Franchise Agreement he entered with
Choice. Pl.'s Appl. Confirm, ECF No. 1. In a pre-motion
conference request, which I construed as a Motion to Dismiss,
Letter Order, ECF No. 9, Patel argues (1) that the Court
lacks subject-matter jurisdiction over the matter, is the
improper venue for the matter to be resolved, and cannot
exercise personal jurisdiction over him; (2) that he received
insufficient service of arbitration notices; and (3) that the
Application does not state a claim for which relief can be
granted, Def.'s Mot. ECF No. 6. Choice filed an
Opposition, Pl.'s Opp'n, ECF No. 10, and Patel filed
a Reply, ECF No. 11. No hearing is necessary. Loc. R. 105.6
(D. Md.). For the reasons provided herein, I will DENY
February 2009, Choice and Patel entered into a Franchise
Agreement (“Agreement”), which authorizes Patel
to operate a Quality Inn® franchise located at 2800 N.W.
Texas Street, Highway 70 West, Idabel, Oklahoma 74745.
Agreement ¶ 1.a, Pl.'s Opp'n Ex. 1, ECF No.
10-1. In the Agreement, Patel promised, among other things,
to pay monthly franchise fees. Id. ¶ 4.b. At
some point, Patel allegedly began failing to remit timely
franchise fees, and Choice sent him a Notice of Default via
Federal Express to the contractually-appointed Designated
Representative (also Patel) at an Oregon address specified in
the Agreement and by standard mail to the hotel. Notice of
Default, Pl.'s Opp'n Ex. 2., ECF No. 10-2; Agreement
¶ 1.e. After Patel failed to cure the default, Choice
sent him a Notice of Termination in November 2012 at the
Designated Representative's address and at the hotel.
Notice of Termination, Pl.'s Opp'n Ex. 3, ECF No.
January 2015, Choice initiated arbitration proceedings
according to the Agreement's terms by serving Patel by
certified mail at the Designated Representative's
address, see Agreement ¶¶ 15, 21; American
Arbitration Association (AAA) Comm. Arb. R. 4(g), and
received confirmation of receipt, Return Receipt, Pl.'s
Opp'n Ex. 4, ECF No. 10-4. The AAA also issued notices to
Patel at the Designated Representative's address. AAA
File 4-5, 8-12, 18, Pl.'s Opp'n Ex. 5, ECF No.
10-5. Patel failed to participate in the
arbitration proceedings, prompting the arbitrator to
determine that Patel received due and proper notice and to
award Choice over $100, 000 in damages. Ex Parte Award of
Arbitrator, Pl.'s Appl. Confirm Ex. 2, ECF No. 1-1. In
May 2016, Choice filed the instant Application requesting
confirmation of the award, which Patel now moves to dismiss.
may move to dismiss for lack of subject-matter jurisdiction
pursuant to Fed.R.Civ.P. 12(b)(1). Federal district courts
have jurisdiction over claims involving completely diverse
litigants and an amount in controversy exceeding $75, 000.
See 28 U.S.C. § 1332(a)(1). A corporation is a
citizen “of any State by which it has been incorporated
and of the State where it has its principal place of
business, ” 28 U.S.C. § 1332(c)(1), meaning
“the place where a corporation's officers direct,
control, and coordinate the corporation's activities,
” Hertz Corp. v. Friend, 559 U.S. 77, 92-93
(2010). An individual is a citizen of the state in which he
is domiciled. Gilbert v. David, 235 U.S. 561, 569
(1915). Patel contends that the court lacks subject-matter
jurisdiction over the case, Def.'s Mot. ¶ 8, but
does not dispute that Choice is incorporated in Delaware and
maintains its principle place of business in Maryland,
Pl.'s Opp'n 1. Patel currently resides in Oklahoma
and previously resided in Oregon, Def.'s Mot.
¶¶ 1, 8, and Choice seeks to confirm an award of
more than $100, 000, Pl.'s App. Conf. ¶ 2.
Accordingly, I find the Court possesses diversity
jurisdiction over the claim.
also disputes that venue is proper. Def.'s Mot. ¶ 8.
Fed.R.Civ.P. 12(b)(3) provides a vehicle for a party to
dismiss an action for improper venue. “Venue is largely
a matter of litigational convenience, ” and can be
waived by the Defendant. Wachovia Bank v. Schmidt,
546 U.S. 303, 316 (2006). The Federal Arbitration Act
provides that an application to confirm an arbitration award
should be made in the judicial district in which the award
was made. 9 U.S.C. § 9. The arbitration award was
rendered in Maryland in compliance with the Agreement's
terms. Ex Parte Award of Arbitrator; Agreement ¶ 21.
Accordingly this Court is the proper venue to resolve this
to Patel, the Court also lacks personal jurisdiction over
him. Def.'s Mot. ¶ 8. Pursuant to Fed.R.Civ.P.
12(b)(2), a party may seek dismissal of a claim for want of
personal jurisdiction. Whereas subject-matter-jurisdiction
requirements cannot be waived, personal-jurisdiction
requirements can be. “[A] valid forum selection clause
. . . may act as a waiver to objections of personal
jurisdiction.” Consulting Eng'rs Corp. v.
Geometric Ltd., 561 F.3d 273, 281 n.11 (4th Cir. 2009);
see also Burger King Corp. v. Rudzewicz, 471 U.S.
462, 472 n.14 (noting that “forum-selection provisions
[that] have been obtained through freely negotiated
agreements and are not unreasonable and unjust . . . do not
offend due process”). Forum-selection “clauses
are prima facie valid and should be enforced unless
enforcement is shown by the resisting party to be
‘unreasonable' under the circumstances, ”
Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10
(1972). The Agreement provides that “[j]udgment on the
arbitration award may be entered in any court having
jurisdiction” and designates Maryland as the location
for any arbitration proceedings. Agreement ¶ 21. And, as
discussed above, the Arbitration Act provides that an
application to confirm an arbitration award should be made in
the judicial district in which the award was made. 9 U.S.C.
§ 9. Choice argues that that ...