Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Choice Hotels International, Inc. v. Patel

United States District Court, D. Maryland, Southern Division

February 17, 2017

CHOICE HOTELS, INTERNATIONAL, INC., Plaintiff,
v.
JITENDRA PATEL, Defendant.

          MEMORANDUM OPINION AND ORDER

          Paul W. Grimm United States District Judge.

         Defendant 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 Patel's Motion.

         Background

         In 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. 10-3.

         In 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.[1] 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.

         Discussion

         Jurisdiction and Venue

         1. Subject-Matter Jurisdiction

         A party 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.

         2. Venue

         Patel 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 matter.

         3. Personal Jurisdiction

         According 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 ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.