Laufer Group International, Ltd. v. Standard Furniture Mfg. Co., LLC

Background

Laufer Group International, Ltd. filed a breach-of-contract action against Standard Furniture Mfg. Co., LLC, International Furniture Marketing LLC, Todd Evans, and Kerry Nickerson. Laufer alleged that Standard Furniture hired it to transport goods from Asia to the United States from late 2018 through October 2019, that Laufer issued bills of lading for those services, and that the defendants did not pay all of the resulting invoices. Laufer alleged that the defendants were jointly and severally liable for $542,803.23, plus interest and other amounts provided for in the bills of lading.

The bills of lading allegedly identified International Furniture Marketing as consignee on most shipments and Standard Furniture as consignee on the rest. Their terms defined “Merchant” broadly and stated that the Merchant and its principals were jointly and severally liable for freight and other charges, collection and litigation costs, and certain losses resulting from breaches.

The defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(2), which concerns personal jurisdiction, and Rule 12(b)(6), which concerns whether a complaint states a legally sufficient claim. Laufer opposed dismissal and alternatively requested permission to amend.

Personal Jurisdiction

The court denied Standard Furniture’s and International Furniture Marketing’s Rule 12(b)(2) motion. Laufer alleged that both companies were parties to, and bound by, bills of lading containing a forum-selection clause. The court held that these allegations were legally sufficient at the pre-discovery stage to make a preliminary showing of personal jurisdiction. The defendants argued that Laufer had attached only a generic bill of lading rather than the actual bills naming them, but the court concluded that this did not defeat jurisdiction at this stage. The defendants did not challenge the validity of the forum-selection clause or argue that they would not be bound by the actual bills of lading.

The court also denied Evans’s Rule 12(b)(2) motion. Laufer alleged that Evans was a principal of Standard Furniture because he had been its chief executive officer during the relevant period. The court concluded that, at this stage, Evans’s position supported a preliminary showing that he was a principal bound by the bills of lading’s forum-selection clause. The court also stated that Evans’s arguments that he had not signed an agreement, had not seen the bills of lading, and was no longer employed by Standard Furniture did not defeat jurisdiction on the allegations and affidavit before the court.

The court granted Nickerson’s Rule 12(b)(2) motion. Nickerson’s employment had ended before Laufer began providing the transportation services. She had been Standard Furniture’s vice president of human resources, rather than an officer or director, and she stated that she had no responsibility for its financial, operational, or accounting activities. Laufer did not provide additional facts to rebut those statements. The court therefore found that Laufer had not made the required preliminary showing that Nickerson was a principal bound by the forum-selection clause.

Breach-of-Contract Claim

The court denied the defendants’ Rule 12(b)(6) motion directed at Laufer’s breach-of-contract claim. The court explained that a plaintiff need not attach the contract or quote its terms word for word, but must allege the contract’s terms sufficiently to show the basis for liability.

The court found that Laufer had adequately alleged that Standard Furniture retained Laufer to transport goods, that the bills of lading were the contracts of carriage, that Standard Furniture and International Furniture Marketing were identified as consignees, that Laufer performed its services, that the defendants refused to pay, and that Laufer suffered damages. The defendants’ argument that Laufer had not attached the actual bills of lading therefore did not require dismissal of the contract claim.

Leave to Amend and Disposition

Because the court dismissed only the claim against Nickerson for lack of personal jurisdiction, it granted Laufer leave to amend only that issue. The court permitted Laufer to try to establish that Nickerson had executed credit agreements binding her to the bills of lading’s terms. Any amended complaint had to be filed by September 4, 2020.

The court’s final disposition was that the defendants’ motion to dismiss was GRANTED in part and DENIED in part. Laufer’s request for leave to amend was GRANTED on the limited Nickerson issue. If Laufer did not amend, it was required to indicate that choice in a letter, after which the remaining defendants would have 21 days to answer.