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White Oak Power Constructors v. Alstom Power, Inc.

United States District Court, E.D. Virginia

November 7, 2017

WHITE OAK POWER CONSTRUCTORS
v.
ALSTOM POWER, INC., and OLD DOMINION ELECTRIC COOPERATIVE

          MEMORANDUM

          Catherine C. Blake United States District Judge.

         White Oak Power Constructors (“White Oak”) has sued Alstom Power, Inc. (“Alstom”) and Old Dominion Electric Cooperative (“Old Dominion”). White Oak has brought claims of fraud in the inducement, fraudulent misrepresentation, negligent misrepresentation, and breach of contract against both defendants arising from contracts pertaining to the construction of a power plant in Rising Sun, Maryland. White Oak also has brought a claim of quantum meruit against Old Dominion, and seeks declaratory judgments pertaining to liquidated damages from both Alstom and Old Dominion. Now pending before the court are Alstom's motion to transfer venue and Old Dominion's motion to transfer venue, or in the alternative, to dismiss. The motions have been fully briefed, and no oral argument is necessary. See Local Rule 105.6. For the reasons explained below, the motions to transfer will be granted.

         BACKGROUND

         Defendant Old Dominion is a Virginia-based electric power cooperative. (Mem. Supp. Old Dominion's Mot. Transfer Venue at 3, ECF No. 24-1; Am. Compl. ¶ 8, ECF No. 10.) In 2013, after a competitive bidding process, Old Dominion entered into an Equipment Purchase Agreement (“Alstom Agreement”) with Defendant Alstom for three generators for use in the Wildcat Point Generation Facility under development in Rising Sun, Maryland (“the Plant”). Mem. Supp. Alstom's Mot. Transfer Venue at 5, ECF No. 22-1.) In 2014, after another competitive bidding process, Old Dominion entered into an Engineer, Procure and Construct Contract (“White Oak Agreement”) with plaintiff White Oak to construct the Plant and prepare it for operation. (Mem. Supp. Old Dominion's Mot. Transfer Venue at 3, ECF No. 24-1.) All three parties also signed an Assignment, Assumption, and Consent Agreement (“Assignment Agreement”) assigning certain of Old Dominion's rights and responsibilities from the Alstom agreement to White Oak.

         The Alstom Agreement contains a forum-selection clause that states:

Any legal action or proceeding with respect to this Agreement shall exclusively be brought in the state courts of Virginia located in Henrico County, Virginia or the United States District Court for the Eastern District of Virginia located in Richmond, Virginia. Each of the Parties hereby accepts and consents to, generally and unconditionally, the jurisdiction of the aforesaid court (and appellate courts with jurisdiction to hear appeals thereform. Each of the Parties hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement brought in the courts referred to above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(Alstom Agreement, Ex. A ¶ 20.2, ECF No. 10-1.) The Assignment Agreement contains a substantively identical forum-selection provision. (See Assignment Agreement, Ex. C § 12(b), ECF No. 1-3.)

         The White Oak Agreement contains a choice of law and forum-selection provision that states:

The laws of the Commonwealth of Virginia shall govern the validity, interpretation, construction and performance of this Agreement without regard to principles of conflicts of law. Both parties hereto agree, subject to Section 13 hereof, to submit to the exclusive jurisdiction of the United States District Court for the Eastern District of Virginia located in Richmond, Virginia, in any litigation between the parties or, if the federal court lacks jurisdiction, the state courts of the Commonwealth of Virginia located in Henrico County, Virginia. Contractor also agrees venue lies and that all discovery in any proceeding shall take place in the County of Henrico. Contractor hereby waives any objection that it may now or hereafter to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum.

(White Oak Agreement, Ex. B § 15.12, ECF No. 1-2.)

         White Oak now alleges that the amount of work required to complete the Plant far exceeds that which was represented by Old Dominion and Alstom during the bidding process that resulted in the White Oak and Alstom agreements. (See generally, Am. Compl. ¶¶ 75-86 ECF No. 10.) White Oak initially raised these concerns with Old Dominion and Alstom in March 2016. (Id. ¶ 78.) The parties discussed the increase in work required for completion of the Plant via email in January 2017. Id. ¶ 83-84. White Oak also alleges that both defendants failed to perform certain required actions related to construction of the Plant. (See, e.g., Id. ¶¶ 121, 127, 141, 156, 159, 166, 178.) All parties have been in communication regarding these various issues throughout the beginning of 2017. (See, e.g Id. ¶¶ 123, 176, 179, 183-89, 196-97.)

         On May 24, 2017, White Oak filed this suit against Old Dominion and Alstom, claiming fraud in the inducement, fraudulent misrepresentation, negligent misrepresentation, and breach of contract against both defendants arising from contracts pertaining to the construction of a power plant in Rising Sun, Maryland. White Oak also has brought a claim of quantum meruit against Old Dominion, and seeks declaratory judgments pertaining to liquidated damages from both Alstom and Old Dominion. (See generally, Am. Compl., ECF 10.) On August 21, Alstom filed a motion to transfer venue pursuant to 28 U.S.C. § 1404(a) and Old Dominion filed a motion to transfer venue to the Eastern District of Virginia, pursuant to 28 U.S.C. § 1404(a) or, in the alternative, to dismiss. (ECF Nos. 22, 24.) White Oak filed responses to these motions on September 20. (ECF Nos. 30, 31.) Old Dominion filed its reply on October 5, and Alstom filed its reply on October 11. (ECF Nos. 32, 33.) On October 23, White Oak filed a motion for leave to file a surreply.[1] (ECF No. 34.)

         ANALYSIS

         Alstom and Old Dominion both argue that the case should be transferred to the Eastern District of Virginia pursuant to 28 U.S.C. § 1404(a), consistent with the forum selection clause contained in both contracts. Old Dominion argues, in the alternative, that White Oak has not adhered to the dispute resolution procedures required before litigation in the White Oak Agreement, so this suit must be dismissed under Rule 12(b)(1) or 12(b)(6). White Oak responds that its tort claims are outside the scope of the forum selection clauses and, even if the tort claims are within the scope of the forum selection clauses, enforcing ...


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