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RT Consulting LLC v. Kentucky Bankers Association

United States District Court, D. New Hampshire

February 26, 2016

RT Consulting LLC
v.
Kentucky Bankers Association Opinion No. 2016 DNH 036

          MEMORANDUM AND ORDER

          PAUL BARBADORO, District Judge.

         RT Consulting LLC ("RTC"), a New Hampshire consulting firm, sued the Kentucky Bankers Association ("KBA"), a trade group based in Louisville, Kentucky, on a variety of legal theories that all stem from a claim that KBA breached a Management Services Agreement ("Agreement") between the two entities. KBA has responded with a motion to dismiss (Doc. No. 10) contending that the court lacks personal jurisdiction and that the complaint fails to state a viable claim for relief. In the event that its motion to dismiss is denied, KBA alternatively claims that the court should transfer the case to the Western District of Kentucky (Doc. No. 11).

         The Agreement includes a forum selection clause that seemingly precludes both motions, but KBA argues that it is not subject to the forum selection clause because it was never made a party to the Agreement. Instead, it contends that RTC contracted with a separate entity that KBA identifies as the "Kentucky Bankers Association Health and Wealth Benefit Trust." For the reasons described below, RTC has alleged sufficient facts to support its contention that KBA was made a party to the Agreement. Accordingly, I deny KBA's motions.

         I. BACKGROUND

         KBA is a Kentucky corporation that provides employee benefit plans to banks. See Doc. No. 1 at 1-2. In October 2013, KBA's president, Ballard W. Cassady, and a representative of RTC signed the Agreement. In its preamble, the Agreement states that it is a contract between RTC and an entity named the "Kentucky Bankers Association (KBA') Health and Welfare Benefit Program." Doc. No. 1-1 at 1. Throughout the document, the Agreement repeatedly refers to this entity as "the Company, " although an addendum titled "Schedule A" also references "KBA" and "KBA's Plan, " specifically noting that "KBA is responsible for all legal requirements and administrative obligations." Id. at 1-7. The Agreement requires that all notices to "the Company" be sent to Debra Stamper of the "Kentucky Bankers Association." Id. at 4. Stamper is KBA's General Counsel and Executive Vice President. Doc. No. 1-2.

         The Agreement includes a forum selection clause providing that "[a]ny litigation, court action, arbitration, or similar proceeding shall be brought and litigated in the State of New Hampshire." Doc. No. 1-1 at 4. It also includes a termination provision allowing either party to terminate the Agreement upon written notice to the other party. Id. at 2. The termination provision gives the "breaching party" ten business days after receipt of notice of termination to "cure such default." Id.

         Pursuant to its understanding of the Agreement, RTC developed an online enrollment and communication service for KBA in the spring of 2014. Doc. No. 1 at 3. RTC incurred substantial costs to develop the enrollment and communication service, but KBA refused to implement it. Id . In response, RTC notified KBA that its refusal to implement the service was a breach of the Agreement. Id.

         Over the course of 2014, RTC continued to provide services to KBA pursuant to the Agreement. Id. at 4. In the fall of 2014, RTC expended significant resources to develop a "Wellness Program" to provide health benefits to KBA's plan participants. Id . The parties discussed a proposal to amend the Agreement to address the Wellness Program, but KBA ignored RTC's requests to amend the Agreement and the proposed amendment was never adopted. Id. at 4-5. Novertheless, RTC implemented the Wellness Program, getting it "up and running" by January 2015. Id. at 5.

         In March 2015, Stamper sent RTC a letter stating that "the Participating Employer Committee of the KBA Health and Welfare Benefit Program (KBA Program') has determined that it is necessary to terminate the relationship pursuant to paragraph 9.b of the Management Services Agreement...." Doc. No. 1-2. Stamper stated in her letter that she "consider[ed] the 10-day cure period to have been satisfied" because of "the continued and repeated requests by the Program for compliance with the Agreement." Id . The letter did not specify how RTC had allegedly breached the Agreement. See id.

         Soon after, RTC filed this action, bringing five claims against KBA: breach of contract; breach of the covenant of good faith and fair dealing; unjust enrichment; promissory estoppel; and unfair and deceptive trade practices under Section 358:2 of the New Hampshire Revised Statutes. Doc. No. 1 at 6-10. KBA countered with the present motions to dismiss and to change venue.

         II. ANALYSIS

         KBA argues that RTC's complaint must be dismissed because the court lacks personal jurisdiction over it, and because the complaint fails to state a viable claim for relief. In the alternative, it argues that the action should be transferred to the Western District of Kentucky if it is not dismissed. Because the standards of review that govern these arguments differ, I deal with each argument separately.

         A. Personal Jurisdiction

         KBA first moves to dismiss for lack of personal jurisdiction. When a defendant contests personal jurisdiction, the plaintiff bears the burden of demonstrating a basis for jurisdiction. Astro-Med, Inc. v. Nihon Kohden Am., Inc., 591 F.3d 1, 8 (1st Cir. 2009). Because I have not held a hearing on the motion, RTC must only make a prima facie showing that this court has personal jurisdiction. See Cossaboon v. Me. Med. Ctr., 600 F.3d 25, 31 (1st Cir. 2010). A prima facie showing requires the plaintiff to "proffer[] evidence which, if credited, is sufficient to support findings of all facts essential to personal jurisdiction." Lechoslaw v. Bank of Am., N.A., 618 F.3d 49, 54 (1st Cir. 2010) (internal quotation marks omitted). I consider RTC's allegations to the extent they are supported by specific facts set forth in the record and consider evidence offered by KBA "to the extent that [it is] uncontradicted." Cossaboon, 600 F.3d at 31 (internal quotation marks omitted). I construe the evidence "in the light most congenial to the ...


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