Removal, Forum Selection, and Personal Jurisdiction in a Massachusetts Contract Dispute
Harborline Software LLC, a Massachusetts LLC whose members are all Massachusetts citizens, signed a $180,000 contract with Adirondack Systems Corp., a New York corporation with its principal place of business in Albany. The contract required Adirondack to install software at Harborline's Boston office. Adirondack sent two engineers to Boston for six weeks; negotiations and performance occurred there. The contract contains a clause: 'Any action arising under this Agreement shall be brought exclusively in the state courts of New York County, New York.' It says nothing about removal. Harborline sues Adirondack in Suffolk Superior Court for breach. Adirondack's registered agent in New York is served on March 3. On March 15, Adirondack removes to the U.S. District Court for the District of Massachusetts and then moves to dismiss for lack of personal jurisdiction, improper venue, and enforcement of the forum-selection clause. Harborline moves to remand. Adirondack has no office, employees, or property in Massachusetts.
1. Was Adirondack's removal timely and proper? Should the federal court remand?
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Removal was timely. Under 28 U.S.C. § 1446(b), a defendant must file the notice of removal within 30 days after service. Adirondack was served March 3 and removed March 15-12 days later. Subject-matter jurisdiction exists: Harborline is a Massachusetts LLC, and an LLC takes the citizenship of its members, all of whom are Massachusetts citizens; Adirondack is a New York corporation; the parties are completely diverse, and the $180,000 claim exceeds $75,000. The forum-selection clause does not make removal improper. A forum-selection clause is a contract term that may be enforced through a motion to transfer under 28 U.S.C. § 1404(a) or forum non conveniens, not a defect in removal. The clause also does not, by itself, waive the right to remove. Remand should therefore be denied; the district court should separately decide whether to enforce the clause by transferring to the Southern District of New York or dismissing.
2. Analyze whether Massachusetts may exercise personal jurisdiction over Adirondack.
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Massachusetts has personal jurisdiction. The long-arm statute, G.L. c. 223A, § 3(a), reaches 'transacting any business in this commonwealth.' Adirondack negotiated and performed a $180,000 contract in Boston and sent two engineers there for six weeks. That is purposeful availment-Adirondack reached into Massachusetts to obtain and perform the contract. The claim arises from those very contacts. The exercise is reasonable: Adirondack is a New York corporation with no Massachusetts office, but the burden of defending in Boston is modest; Massachusetts has an interest in regulating contracts performed within its borders; and Harborline's interest in suing at home is legitimate. The forum-selection clause does not defeat jurisdiction. It may be a binding agreement to litigate in New York, but it is not a lack of personal jurisdiction; the court can enforce it through transfer or dismissal, not by granting a Rule 12(b)(2) motion.
3. Is venue proper in Suffolk Superior Court and in the U.S. District Court for the District of Massachusetts?
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Venue is proper. In Massachusetts Superior Court, G.L. c. 223, § 1, venue lies in the county where the plaintiff or defendant resides or where the cause of action arose. Harborline has its principal place in Boston, Suffolk County, and the contract was performed at its Boston office; the breach claim therefore arose in Suffolk. After removal, federal venue is governed by 28 U.S.C. § 1391(b)(2), which permits venue where a substantial part of the events occurred-Boston. The forum-selection clause does not make venue 'improper' in the statutory sense; it may support a § 1404(a) transfer to New York. Thus Adirondack's venue objection should fail.