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Yummy Yogurt Indy, LLC v. Orange Leaf Licensing, LLC

United States District Court, S.D. Indiana, Indianapolis Division

March 18, 2015

YUMMY YOGURT INDY, LLC a/k/a RANGE LEAF INDY 1, LLC, d/b/a ORANGE LEAF OF BLUFF ROAD, d/b/a ORANGE LEAF OF MASS AVENUE, d/b/a ORANGE LEAF OF EMERSON, d/b/a ORANGE LEAF OF THE AVENUE, d/b/a ORANGE LEAF OF BROAD RIPPLE, d/b/a ORANGE LEAF OF ZIONSVILLE; YUMMY YOGURT MUDGA, LLC, d/b/a ORANGE LEAF OF GROVETOWN, d/b/a ORANGE LEAF OF COLUMBUS, d/b/a ORANGE LEAF OF INDIANAPOLIS, d/b/a ORANGE LEAF OF TERRE HAUTE; CHINTU PATEL d/b/a ORANGE LEAF OF PLAINFIELD; ADITI 3 YUMMY YOGURT, LLC a/k/a ADITI 3 ORANGE LEAF, LLC, d/b/a ORANGE LEAF OF SHELBYVILLE; S&A RESTAURANT IV, LLC d/b/a ORANGE LEAF OF FRANKLIN; YUMMY YOGURT MUDFL, LLC d/b/a ORANGE LEAF OF BOCA RATON, d/b/a ORANGE LEAF OF DELRAY BEACH, d/b/a ORANGE LEAF OF LAKE MARY, d/b/a ORANGE LEAF OF MELBOURNE, d/b/a ORANGE LEAF OF NAPLES, d/b/a ORANGE LEAF OF OCOEE, d/b/a ORANGE LEAF OF STUART, d/b/a ORANGE LEAF OF ALAMONTE SPRINGS, d/b/a ORANGE LEAF OF APOPKA, d/b/a ORANGE LEAF OF JACKSONVILLE BEACH, d/b/a ORANGE LEAF OF JACKSONVILLE, d/b/a ORANGE LEAF OF MARCO ISLAND, d/b/a ORANGE LEAF OF MIRAMAR BEACH, d/b/a ORANGE LEAF OF PORT ORANGE, d/b/a ORANGE LEAF OF TAMPA; YUMMY YOGURT MUDIL, LLC d/b/a ORANGE LEAF OF CHICAGO, d/b/a ORANGE LEAF OF DEERFIELD, d/b/a ORANGE LEAF OF ELK GROVE, d/b/a ORANGE LEAF OF HOFFMAN ESTATES, d/b/a ORANGE LEAF OF LA GRANGE, d/b/a ORANGE LEAF OF ORLAND PARK, d/b/a ORANGE LEAF OF WINNETKA, d/b/a ORANGE LEAF OF WOODRIDGE; YUMMY YOGURT MUDTN, LLC d/b/a ORANGE LEAF OF FARRAGUTT, d/b/a ORANGE LEAF OF KNOXVILLE, d/b/a ORANGE LEAF OF CEDAR BLUFF, d/b/a ORANGE LEAF OF COLLIERVILLE, d/b/a ORANGE LEAF OF JOHNSON CITY, d/b/a ORANGE LEAF OF OOLTEWAH; YUMMY YOGURT TDATN LLC a/k/a ORANGE LEAF TN LLC, d/b/a TDATN; YUMMY YOGURT TDAIL, LLC; YUMMY YOGURT TDAGA, LLC, and YUMMY YOGURT TDAFL LLC, Plaintiffs,
v.
ORANGE LEAF LICENSING, LLC, ORANGE LEAF HOLDINGS, LLC, OT HOLDINGS, LLC, OT HOLDINGS NORMAN, LLC, OT HOLDINGS LAWTON, LLC, OT HOLDINGS WICHITA FALLS, LLC, OT HOLDINGS TYLER, LLC, OT HOLDINGS LITTLE ROCK, LLC, OL SHREVEPORT HOLDINGS, LLC, OL ADDISON HOLDINGS, LLC, OL MINZER HOLDINGS, LLC, OL AUSTIN, LLC, OL BOSSIER CITY HOLDINGS, LLC, OL KENWOOD HOLDINGS, LLC, and OL COLERAIN HOLDINGS, LLC, Defendants.

ENTRY ON DEFENDANTS' MOTION TO TRANSFER

RICHARD L. YOUNG, Chief District Judge.

This lawsuit arises from numerous franchise agreements entered into by Plaintiffs with Defendant, Orange Leaf Holdings, LLC, to open and operate Orange Leaf Frozen Yogurt stores in various locations in Indiana, Florida, Illinois, Tennessee, and Georgia. The Plaintiffs constitute several limited liability companies that were created to own the subject Orange Leaf stores and an individual, Chintu Patel, who, individually and through a central holding company, exercised exclusive control and authority over, and otherwise generally acted as the managing member of all the LLC Plaintiffs. The LLC Plaintiffs and Patel executed various agreements with Orange Leaf, including Franchise Agreements, Multi-Unit Development Agreements ("MUDs"), and Territorial Development Agreements ("TDAs") (collectively "Agreements"), setting forth the terms and conditions of their business relationship. In addition, Patel executed numerous personal guarantees of the Franchise Agreements which made him individually obligated to perform and comply with the terms and conditions of the Franchise Agreements.

All of the Agreements have forum selection, jurisdiction, and choice-of-law clauses which, Defendants contend, require that any lawsuit arising out of or related to the Agreements be filed in a court in Oklahoma County, Oklahoma. They therefore move to transfer this case to the United States District Court for the Western District of Oklahoma. For the reasons set forth below, the court GRANTS the motion.

I. The Forum Selection Clauses

The 43 Franchise Agreements executed by the various LLC Plaintiffs contain identical forum selection language. They state in pertinent part:

You acknowledge that this Agreement was accepted in the State of Oklahoma.... [T]his Agreement will be governed, to the extent permissible, by the laws of the State of Oklahoma without regard to principles of conflicts of law.... We may institute any action arising out of or relating to this Agreement in any state or federal court in the state of Oklahoma, and you and each guarantor of this agreement irrevocably submits to the jurisdiction of these courts and waive any objection to the application of Oklahoma law or to the jurisdiction or venue in these Oklahoma Courts. If you institute any action arising out of or relating to this Agreement, that action must be brought in a Court located in the County of Oklahoma, Oklahoma, unless that Court will not accept jurisdiction over the case.

(Filing No. 9-1, representative Franchise Agreement, Section XVII(F) at 24). In addition, all 43 Franchise Agreements have an executed personal guarantee attached thereto. The personal guarantees adopt and incorporate the venue and jurisdiction agreements set forth in the Franchise Agreements and all state:

The undersigned Guarantors hereby consent to the applicability of the venue and jurisdiction provision in the Agreement to this Guaranty and Assumption of Obligations.

( Id. at 31). All 43 guarantees are signed by Mr. Patel.

In addition to the Franchise Agreement, the MUDs and TDAs also contain forum selection clauses that are practically identical to the language of the Franchise Agreements. The MUDs state in pertinent part:

If you institute any action arising out of or relating to this Agreement, such suit must be brought in the Superior Court of the County of Oklahoma, Oklahoma, unless said court will not accept jurisdiction over the case.

(Filing No. 9-2, representative Orange Leaf Holdings Multi-Unit Development Agreement, Section VIII G at 6). Similarly, the TDAs state:

If Territory Developer institutes any action arising out of or relating to this Agreement, that action must be brought in the state or federal courts located in the State of Oklahoma, County of Oklahoma, and Territory Developer irrevocably submits to the jurisdiction of such courts and waives any objection ...

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