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UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WISCONSIN
MIDWEST PRECISION MANUFACTURING, INC., Plaintiff, v. PTG HEAVY INDUSTRIES LTD., YORKSHIRE MACHINE TOOLS LTD., and BRUDERS MACHINE TOOLS, INC., Defendants. Case No. 11-CV-570-JPS

ORDER

On October 7, 2011, defendant PTG Heavy Industries Ltd. ("PTG") filed a Partial Motion to Dismiss the Amended Complaint (Docket #21). Plaintiff Midwest Precision Manufacturing, Inc. ("Midwest") has alleged eight causes of action against PTG: breach of contract, breach of express warranty, breach of implied warranty, and four forms of misrepresentation (intentional, statutory, strict, and negligent). Midwest also alleges an eighth cause of action for "loss of business/profits," though it appears only to allege those as damages flowing from the other enumerated causes of action. PTG requests dismissal of all but the first two claims. Based upon the analysis that follows, the motion will be granted. 1. Background The underlying dispute involves the sale by PTG to Midwest of a deep hole boring machine, used to bore holes in metal. The parties executed the sale/purchase agreement pursuant to a 2008 contract ("2008 PTG Contract"). However, the boring machine was also, as alternatively alleged in the complaint, the subject of a 2007 contract of sale ("2007 Yorkshire Contract")

between defendant Yorkshire Machine Tools Ltd. ("Yorkshire") and Midwest. The parties executed the 2007 Yorkshire Contract, but it was never performed because Yorkshire subsequently filed for bankruptcy protection. In 2008, PTG, then under a previous name, acquired certain Yorkshire assets, including the boring machine, through the bankruptcy in an asset purchase agreement. Midwest does allege that PTG purchased Yorkshire assets and further alleges that the purchase "amounts to a consolidation or merger" and that PTG is, therefore, a "mere continuation" of Yorkshire.1 After the asset purchase, PTG and Midwest then entered the 2008 PTG Contract. The causes of action alleged by Midwest arise from the alleged failure of the boring machine to meet the specifications of either contract. As such, Midwest seeks to hold PTG liable either directly under the 2008 PTG Contract, or under the 2007 Yorkshire Contract through its position as alleged successor to Yorkshire. 2. Analysis In the instant motion, PTG does not challenge counts one or two for breach of contract and breach of express warranty to the extent they are directed toward the 2008 PTG Contract. However, PTG makes four

arguments for dismissal of the remaining counts against it (as well as the first two to the extent they apply through the 2007 Yorkshire Contract): PTG cannot be liable as a successor to Yorkshire through an asset purchase agreement; alternatively, the 2007 Yorkshire Contract contains a forum selection clause making this district an improper venue; the four

Midwest actually alleges that PTG's wholly-owned subsidiary purchased the assets and is a mere continuation of Yorkshire, but, in its brief, PTG points out that the "subsidiary" in question was simply PTG's former name.

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misrepresentation claims are barred by the economic loss doctrine because no damages are alleged beyond those flowing solely from the existence of the contract; and, the breach of implied warranty, as well as the claim for lost profits, are expressly barred by the language of both the 2008 PTG Contract and the 2007 Yorkshire Contract. Under Federal Rule of Civil Procedure 12, a cause of action may be dismissed for improper venue. Fed. R. Civ. P. 12(b)(3). Further, per Rule 12(b)(6), a motion to dismiss asserts that the plaintiff has failed to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). In order to survive the motion, the complaint must allege sufficient facts to state a "plausible" claim for relief. Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). The complaint must provide the defendant with "fair notice of what the...claim is and the grounds upon which it rests." Twombly, 550 U.S. at 555. The court reads the complaint in the light most favorable to the plaintiff, accepts all well-pleaded facts as true, and draws all possible inferences in favor of the plaintiff. Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008). Factual allegations are presumed true, "even if doubtful in fact." Twombly, 550 U.S. at 555. However, legal conclusions are not entitled to this assumption of truth. Iqbal, 129 S. Ct. at 1950. While "labels and conclusions" and "a formulaic recitation of the elements" are insufficient, the complaint need only "raise a right to relief above the speculative level." Twombly, 550 U.S. at 555. Moreover, a court may view as waived a claim not supported by the plaintiff in opposing a motion to dismiss. Stransky v. Cummins Engine Co., 51 F.3d 1329, 1335 (7th Cir. 1995) (noting complaint need not contain legal predicate for claim, but "when presented with a motion to dismiss, the nonPage 3 of 10

moving party must proffer some legal basis to support his cause of action"); see also Kirksey v. R.J. Reynolds Tobacco Co., 168 F.3d 1039, 1041 (7th Cir. 1999) (finding an unresponsive response "no response" and that the plaintiff "was defaulted for refusing to respond to the motion to dismiss"). "Our system of justice is adversarial, and our judges are busy people. If they are given plausible reasons for dismissing a complaint, they are not going to do the plaintiff's research and try to discover whether there might be something to say against the defendants' reasoning." Kirksey, 168 F.3d at 1041. Finally, it is worth noting at the outset that contracts "attached to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to his claim" and may, therefore, be considered on a motion to dismiss. Rosenblum v. Travelbyus.com Ltd., 299 F.3d 657, 661 (7th Cir. 2002); see also Minch v. City of Chi., 486 F.3d 294, 300 n.3 (7th Cir. 2007) (noting that where a complaint refers to and rests on a contract not attached to the complaint, "a court might be within its rights to consider that document...so long as the authenticity of the document is unquestioned"). 2.1 Liability Under the 2007 Yorkshire Contract

Because Midwest has failed to respond with any reason why the forum selection clause contained in the 2007 Yorkshire Contract is not applicable here, the court finds the venue improper for all claims arising from that contract, regardless of any possible successor liability on PTG's part. Forum selection clauses "should control unless there is a `strong showing that it should be set aside.'" Heller Fin., Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1290-91 (7th Cir. 1989). Where the clause uses mandatory or obligatory language, it will be enforced unless enforcement "would be Page 4 of 10

unreasonable or unjust or the provision was procured by fraud or overreaching." Paper Express, Ltd. v. Pfankuch Maschinen GmbH, 972 F.2d 753, 757 (7th Cir. 1992). Here, the 2007 Yorkshire Contract contains an offer sheet signed by the parties that contains the operative terms and conditions of Yorkshire contracts. (Griffiths Decl.

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