ALCOF III NUBT, L.P. v. CHIRICO; BRIGADE CAVALRY FUND LTD. v. CHIRICO, 2024 NCBC 53

STATE OF NORTH CAROLINA
MECKLENBURG COUNTY
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
23CV031985-590
ALCOF III NUBT, L.P. et al.,
Plaintiffs,
v.
JAMES M. CHIRICO, JR., KIERAN
MCGRATH, and STEPHEN D.
SPEARS,
Defendants.
ORDER AND OPINION
ON MOTIONS TO DISMISS BY
DEFENDANTS JAMES M. CHIRICO,
JR. AND KIERAN J. MCGRATH
MECKLENBURG COUNTY 23CV031948-590
BRIGADE CAVALRY FUND LTD. et
al.,
Plaintiffs,
and
CANYON DISTRESSED
OPPORTUNITY MASTER FUND III,
L.P. et al.,
Intervenor
Plaintiffs,
v.
JAMES M. CHIRICO, JR. and
KIERAN J. MCGRATH,
Defendants.
1. These related cases arise in the wake of Avaya, Inc.’s bankruptcy in early
2023.1 Plaintiffs are investors that hold interests in loans made to Avaya or in its
1 Some allegations refer to both Avaya and its parent company, Avaya Holdings Corp. For
ease of comprehension, the Court will follow the parties’ lead and refer to the two Avaya
entities simply as “Avaya.”
ALCOF III NUBT, L.P. v. Chirico; Brigade Cavalry Fund Ltd. v. Chirico, 2024
NCBC 53.

secured notes, all of which lost value when the company went bankrupt. Defendants
are some of Avaya’s former officers, including James M. Chirico, Jr. (former president
and chief executive officer) and Kieran J. McGrath (former executive vice president
and chief financial officer). As alleged, Chirico and McGrath wrongfully induced
Plaintiffs to invest in Avaya by trumpeting revenue and earnings guidance that they
knew the company could not meet.
2. One group of Plaintiffs—the Brigade Plaintiffs—sued Chirico and McGrath
for negligent misrepresentation, fraudulent inducement, and related securities
violations. See Brigade Cavalry Fund Ltd. v. Chirico (23CV031948-590) [“Brigade”].
A second group—the Canyon Plaintiffs—intervened in the Brigade action and assert
similar claims against Chirico and McGrath. See id. A third group—the ALCOF
Plaintiffs—began a separate action and assert claims for negligent
misrepresentation, fraudulent inducement, and fraudulent omission against Chirico,
McGrath, and Stephen D. Spears (a third former officer of Avaya). See ALCOF III
NUBT, L.P. v. Chirico (23CV031985-590) [“ALCOF”].
3. This opinion addresses motions to dismiss filed by Chirico and McGrath in
both actions.2 (See Brigade, ECF Nos. 38, 42, 89, 93; ALCOF, ECF Nos. 79, 84.) They
argue that Plaintiffs filed these lawsuits in the wrong venue and that each complaint
fails to state a claim for relief. For the following reasons, the Court GRANTS the
2 Spears has also moved to dismiss the only claim asserted against him in the ALCOF action.
Because his motion differs materially from the motions filed by Chirico and McGrath, the
Court addresses it in a separate opinion.

motions to dismiss for improper venue and DISMISSES the claims against Chirico
and McGrath without prejudice.
Parker Poe Adams & Bernstein LLP, by Melanie Black Dubis and
Andrew Tabeling, and Glenn Agre Bergan & Fuentes LLP, by Andrew
Glenn, Marissa E. Miller, Eric J. Carlson, George L. Santiago, and
Trevor J. Welch, for Plaintiffs ALCOF III NUBT, L.P. et al.
Womble Bond Dickinson (US) LLP, by Jesse Andrew Schaefer and
Raymond M. Bennett, and Debevoise & Plimpton LLP, by Erica
Weisgerber, Morgan Davis, and Maeve O’Connor, for Plaintiffs Brigade
Cavalry Fund, Ltd. et al.
Wyrick Robbins Yates & Ponton LLP, by Lee M. Whitman and Douglas
Scott Hazelgrove, and Sullivan & Cromwell LLP, by Adam S. Paris and
Pierre-Arnaud Barry-Camu, for Intervenor Plaintiffs Canyon Distressed
Opportunity Master Fund III, L.P. et al.
Johnston, Allison & Hord, P.A., by William D. McClelland, Kenneth
Lautenschlager, and Austin R. Walsh, and Dorsey & Whitney, LLP, by
Thomas O. Gorman and Stephen Weingold, for Defendant James M.
Chirico, Jr.
Robinson, Bradshaw & Hinson, P.A., by David C. Wright, Adam Doerr,
and Ethan R. White, and Kellogg, Hansen, Todd, Figel & Frederick,
PLLC, by Reid Mason Figel, Minsuk Han, and Jordan Gonzalez, for
Defendant Kieran McGrath.
James, McElroy & Diehl, P.A., by Jennifer M. Houti and Adam L. Ross,
for Defendant Stephen D. Spears.
Conrad, Judge.
I.
BACKGROUND
4. The following background treats Plaintiffs’ allegations as if they are true.
To avoid citation clutter (and the reader fatigue that comes with it), and because the
three complaints overlap to a large degree, the Court will cite the Brigade Plaintiffs’
complaint for allegations that are common to all pleadings. (See Brigade Compl.,

Brigade, ECF No. 3; Canyon Compl., Brigade, ECF No. 77; ALCOF Am. Compl.,
ALCOF, ECF No. 76.)
5. Avaya is a digital communications company that sells software, hardware,
and support services to businesses around the globe. A few years ago, the company
decided to bet on the growth of its cloud-based product and deemphasize its more
conventional on-premises offerings. Moving to the cloud meant big changes were in
store—not only for what Avaya sold (bundled services with better technology, in
theory) but also how it made sales (through subscriptions rather than licensing). The
bet may have been risky, but by 2022, it seemed that it would pay off. That May,
while touting “record growth” for cloud-based revenue, Chirico stated that the new
“strategy [was] clearly taking hold faster than we anticipated.” Avaya’s regulatory
filings were equally upbeat, heralding a rosy outlook for the rest of the year even as
they reported having undershot financial projections for the quarter just ended.
(Brigade Compl. ¶¶ 32, 33, 40, 43, 44.)
6. Fresh off this burst of optimism, Avaya began looking to raise half a billion
dollars to repay existing debt and for general corporate purposes. Company officials
worked throughout June 2022 to secure commitments from prospective investors,
including Plaintiffs. The ALCOF Plaintiffs pledged $236 million toward a term loan
(called the B-3 Term Loan), while the Brigade Plaintiffs and the Canyon Plaintiffs
agreed to buy $125 million and $25 million in secured notes. Each deal closed in
mid-July 2022.3 (See Brigade Compl. ¶¶ 61, 65, 69–71; see also Brigade Agrmt.,
3 Avaya did not negotiate individually with each Plaintiff. The Brigade and Canyon Plaintiffs
delegated authority to investment managers and advisors to represent them in the

Brigade, ECF No. 38.1; Canyon Agrmt., Brigade, ECF No. 90.9; ALCOF Agrmt.,
ALCOF, ECF No. 84.1.)
7. All the good vibes turned to ashes just two weeks later when Avaya
published preliminary results for the third quarter of its fiscal year (which was the
second quarter of the calendar year). They were grim: Avaya expected to miss its
quarterly revenue and adjusted earnings projections by miles. Worse news was yet
to come. In August, Avaya warned of “substantial doubt about [its] ability to continue
as a going concern.” In November, it confessed that it hadn’t maintained effective
internal controls over financial reporting, tainting its most recent annual SEC report
and delaying its next report. Then, in February 2023, it filed for bankruptcy
protection. (Brigade Compl. ¶¶ 92, 93, 101, 104, 106.)
8. Avaya’s sudden fall carried Plaintiffs’ investments with it. Their loans and
notes plummeted in value, and once the bankruptcy began, they jostled with the other
creditors of the estate to recover what they could. When all was said and done, they
came away tens of millions of dollars in the hole. (See Brigade Compl. ¶ 106; see also
Canyon Compl. ¶ 80; ALCOF Am. Compl. ¶¶ 1, 104.)
9. Plaintiffs now say that Avaya’s bullish messaging from May to July 2022
was just a smokescreen. Avaya’s leadership—namely, Chirico and McGrath—
allegedly knew that the strategic transition to the cloud was failing even as they told
Plaintiffs that it was succeeding. Key members of Avaya’s finance team had sounded
negotiations and in closing their deals. (See Brigade Compl. ¶¶ 4, 31; Canyon Compl. ¶ 4.)
The ALCOF Plaintiffs include original lenders, entities that manage lender funds, and
successors that purchased debt from other original lenders. (See ALCOF Am. Compl. ¶¶ 14–
31.)

the alarm, calling third-quarter revenue targets “scary” and “impossible” and saying
that it would take “more than one miracle” to hit them. Once the fourth quarter
began, any hope for a miracle vanished. An unofficial, internal report showed that
Avaya’s actual performance badly lagged its projections. Though allegedly aware of
this information, Chirico and McGrath told Plaintiffs a different story entirely. They
reaffirmed Avaya’s financial guidance in marketing presentations, investor calls, and
public filings. As late as the day of closing, McGrath certified that Avaya was solvent
and would remain solvent “immediately after.” According to Plaintiffs, they would
not have gone through with closing had Chirico and McGrath told them the truth.
(See Brigade Compl. ¶¶ 46–64, 73–78, 80–89.)
10. In these lawsuits, Plaintiffs seek to hold Chirico and McGrath personally
liable for wrongfully inducing them to invest in Avaya. The Brigade and Canyon
Plaintiffs have asserted claims for negligent and fraudulent misrepresentation as
well as related claims for violations of the North Carolina Securities Act. The ALCOF
Plaintiffs have asserted claims for negligent and fraudulent misrepresentation as
well, added a claim for fraudulent omission, and omitted the securities claim.
11. Chirico and McGrath have moved to dismiss all claims asserted against
them in both cases. (See Brigade, ECF Nos. 38, 42, 89, 93; ALCOF, ECF Nos. 79, 84.)
They contend, first, that Plaintiffs sued them in the wrong forum and are instead
contractually bound to litigate these claims in New York. In addition, they contend
that Plaintiffs have not sufficiently stated a claim for relief.

12. The Court held a hearing on all six motions on 21 May 2024. The motions
are ripe for decision.
II.
ANALYSIS
13. Venue, like jurisdiction, is a threshold matter. Jurisdiction is indispensable;
without it, “a court has no power to act.” In re T.R.P., 360 N.C. 588, 590 (2006).
Venue isn’t quite as vital as that but is still an important inquiry in its own right.
Though endowed with jurisdiction, a plaintiff’s chosen forum may not be the best, the
most convenient, or even an appropriate place to adjudicate a dispute. See Sony
Ericsson Mobile Commc’ns USA, Inc. v. Agere Sys., Inc., 195 N.C. App. 577, 582–83
(2009) (affirming order granting motion to dismiss for improper venue).
14. Chirico and McGrath contend that Plaintiffs’ claims belong in New York, not
North Carolina. This is because all of Avaya’s contracts with Plaintiffs contain New
York forum-selection clauses. Although not parties to those contracts, Chirico and
McGrath say that the forum-selection clauses protect them as agents of Avaya just
as much as Avaya itself. Chirico and McGrath also contend that Plaintiffs should be
equitably estopped from evading their own forum choices.
15. Plaintiffs concede the validity of the forum-selection clauses but contend
that Chirico and McGrath cannot enforce them.4 Each contract contains language
4 The Canyon Plaintiffs contend that Chirico forfeited his argument concerning the
forum-selection clauses because he did not cite Rule 12(b)(3) of the North Carolina Rules of
Civil Procedure as the basis for his motion. This is incorrect. What matters is the substance
of Chirico’s argument, not whether he cited the right or wrong procedural rule. See Hickox
v. R&G Grp. Int’l, Inc., 161 N.C. App. 510, 511–12 (2003) (addressing “application of the
forum selection clause” even though “defendant termed the motion to dismiss for lack of
jurisdiction rather than venue”); see also Carter v. Clowers, 102 N.C. App. 247, 253 (1991)

stating that it does not confer any remedy on anyone other than the contracting
parties. This language, according to Plaintiffs, forecloses any equitable right that
Chirico and McGrath might otherwise have to enforce the forum-selection clauses.
Plaintiffs also contend that estoppel applies only when a claimant tries to avoid a
forum-selection clause while at the same time seeking to enforce the contract’s other
terms, which is not true here.
16. There’s some uncertainty about which State’s law ought to govern these
matters. Most of the parties advocate North Carolina law because the law of the
forum usually governs procedural rights. See, e.g., Martin Marietta Materials, Inc. v.
Bondhu, LLC, 241 N.C. App. 81, 83 (2015). The others advocate New York law
because the three contracts at issue have choice-of-law clauses selecting that State’s
law to govern their validity, enforcement, and interpretation. (See Brigade Agrmt.
§ 6.9; Canyon Agrmt. § 6.9; ALCOF Agrmt. § 13.12.) But no one argues the point in
depth, and no one explains what difference the choice of law makes. Indeed, the Court
sees no reason to pick one over the other because both point to the same result.5
(observing that “nomenclature is unimportant” and that “mislabeled” motion “may be treated
as” if it had been made under the appropriate rule).
5 For what it’s worth, the answer isn’t obvious. New York courts have identified “a division
in authority as [to] whether the law of the forum chosen pursuant to a choice of law clause
governs the enforceability of the forum selection clause.” USA-India Export-Import, Inc. v.
Coca-Cola Refreshments USA, Inc., 2015 N.Y. Misc. LEXIS 255, at *18–19 (N.Y. Sup. Ct. Jan.
30, 2015). North Carolina courts seem unsure as well. Compare, e.g., Peter Millar, LLC v.
Shaw’s Menswear, Inc., 274 N.C. App. 383, 390–91 (2020) (applying Georgia law designated
by choice-of-law clause to determine validity of forum-selection clause), with Apex Tool Grp.,
LLC v. Ingersoll-Rand Co., 2013 NCBC LEXIS 24, at *5–8 (N.C. Super. Ct. May 14, 2013)
(applying both North Carolina and Texas law). Again, there is no need to try to untangle this
authority because North Carolina law and New York law are in sync.

17. Let’s start with the basics: forum-selection clauses are generally valid and
enforceable. Gone are the days when judges would jeer the litigants’ bargained-for
choice of forum as a gambit to “oust the jurisdiction” of the court. See The Bremen v.
Zapata Off-Shore Co., 407 U.S. 1, 9 (1972). A more welcoming stance prevails today.
Outside of arrangements that offend public policy, “contracting parties are free to
choose which law will govern disputes arising out of their contract and where they
will litigate those disputes, just as they are free to choose the other terms of their
bargain.” Karriker v. Harpoon Holdings, L.P., 2024 NCBC LEXIS 23, at *4–5 (N.C.
Super. Ct. Feb. 12, 2024); see also LendingTree, LLC v. Anderson, 228 N.C. App. 403,
408 (2013); Sony Ericsson, 195 N.C. App. at 580 (citing Brooke Grp. v. JCH Syndicate
488, 87 N.Y.2d 530, 534 (1996)); Reynolds v. JOPAL Bronx, LLC, 193 N.Y.S.3d 298,
300 (N.Y. App. Div. 2023).
18. Naturally, the scope of a forum-selection clause depends on what it says. In
the B-3 Term Loan agreement, Avaya and the ALCOF Plaintiffs promised to submit
all disputes “relating to” the agreement to “the exclusive general jurisdiction of” New
York state and federal courts. (ALCOF Agrmt. § 13.13(a).) The investment
agreements between Avaya and the Brigade and Canyon Plaintiffs say the same
thing using slightly different words. (See Brigade Agrmt. § 6.9; Canyon Agrmt. § 6.9.)
19. All three clauses are indisputably mandatory in effect. New York is not just
a preferred or permitted forum; it is the exclusive forum for litigation relating to the
contracts. See Mark Grp. Int’l, Inc. v. Still, 151 N.C. App. 565, 568 (2002)
(highlighting “language that indicates the parties’ intent to make jurisdiction

exclusive”); Fear & Fear, Inc. v. N.I.I. Brokerage, L.L.C., 851 N.Y.S.2d 311, 313 (N.Y.
App. Div. 2008) (same).
20. All three clauses are also about as broad as forum-selection clauses get. The
phrase “relating to” is expansive, and disputes “relating to” a contract include
disputes about not only contract “performance” but also contract “formation” and
other matters touching on the parties’ contractual relationship. Rodgers Builders,
Inc. v. McQueen, 76 N.C. App. 16, 25 (1985). In fact, both sides take it as a given that
Plaintiffs’ claims relate to their contracts with Avaya. And for good reason: whether
a contract was wrongfully induced by fraud or negligence is a controversy that relates
to the contract. See, e.g., Speedway Motorsports Int’l, Ltd. v. Bronwen Energy
Trading, Ltd., 2009 NCBC LEXIS 17, at *16–18 (N.C. Super. Ct. Feb. 18, 2009);
Freeford Ltd. v. Pendleton, 857 N.Y.S.2d 62, 65–66 (N.Y. App. Div. 2008).6
21. In short, the clauses at issue are valid, they’re mandatory, and they cover
Plaintiffs’ claims. The bigger question is this: can Chirico and McGrath, as
nonparties to the contracts, enforce them? The answer is yes.
6 See also, e.g., McMillan v. Unique Places, LLC, 2015 NCBC LEXIS 3, at *19–20 (N.C. Super.
Ct. Jan. 14, 2015) (citing McQueen, 76 N.C. App. at 18, 25) (holding that claim for fraudulent
inducement arose “in connection with” contracts and thus fell under their arbitration
clauses); Montoya v. Cousins Chanos Casino, LLC, 2012 N.Y. Misc. LEXIS 86, at *3–5, *13–
15 (N.Y. Sup. Ct. Jan. 12, 2012) (concluding that claims for “fraud” and “fraudulent
concealment” fell under forum-selection clause because they grew “out of the contractual
relationship between the parties”); Stein v. United Wind, Inc., 2021 N.Y. Misc. LEXIS 472, at
*6 (N.Y. Sup. Ct. Feb. 8, 2021) (“Such language has been held to include . . .
fraud-in-the-inducement claims . . . .”); Triple Z Postal Servs., Inc. v. United Parcel Serv., Inc.,
2006 N.Y. Misc. LEXIS 3406, at *15–30 (N.Y. Sup. Ct. Nov. 24, 2006) (“[P]ublic policy favors
enforcement of forum selection clauses and supports a broad reading of these clauses, which
may govern tort claims.”).

22. True, a contract usually binds the parties to it and no one else. But various
equitable doctrines allow nonparties to enforce, or require nonparties to follow, terms
in a contract executed by others. Take agency law, for example. North Carolina
courts have allowed “non-signatory agents to avail themselves of the protection of
their principal’s” agreement to arbitrate disputes on the theory that “an agent can
assume the protection of the contract which the principal has signed.” Brown v.
Centex Homes, 171 N.C. App. 741, 745 (2005) (citation and quotation marks omitted);
accord Ellison v. Alexander, 207 N.C. App. 401, 411–13 (2010). An arbitration clause
is just a type of forum-selection clause, so these agency principles carry over to this
context too. See Se. Auto., Inc. v. Genuine Parts Co., 2017 NCBC LEXIS 34, at *39
n.14 (N.C. Super. Ct. Apr. 17, 2017) (citing Ellison and allowing corporate agent to
enforce principal’s forum-selection clause); Big League Analysis, LLC v. Off. of the
Comm’r of Baseball, 2016 NCBC LEXIS 68, at *21 (N.C. Super. Ct. Aug. 29, 2016)
(same).
23. New York courts hew to the same doctrinal line. Agents generally get “the
benefit of arbitration agreements entered into by their principals to the extent that
the alleged misconduct relates to their behavior as officers or directors or in their
capacities as agents of the corporation.” Revis v. Schwartz, 140 N.Y.S.3d 68, 81 (N.Y.
App. Div. 2020) (quoting Hirschfeld Prods., Inc. v. Mirvish, 673 N.E.2d 1232, 1233
(N.Y. 1996)); see also Kim v. Cho, 2015 N.Y. Misc. LEXIS 4816, at *4 (N.Y. Sup. Ct.
Dec. 22, 2015) (stating that “arbitration clauses” are “a type of forum selection
clauses”). More broadly, “a nonparty that is ‘closely related’ to one of the signatories

can enforce a forum selection clause.” Freeford, 857 N.Y.S.2d at 67; see also Siroy v.
Jobson Healthcare Info. LLC, 2016 N.Y. Misc. LEXIS 1920, at *6–7 (N.Y. Sup. Ct.
May 23, 2016) (collecting cases concluding that a “non-signatory employee was
sufficiently close to the employer who did sign the contract” to enforce a
forum-selection clause).
24. There are good reasons why North Carolina, New York, and most other
jurisdictions have taken this approach.7 A corporation can act only through its
agents, and contracting parties know full well that a corporate signatory’s agents are
the ones who will negotiate on its behalf to make a deal and then carry out its
obligations once the deal has been made. It is easy to foresee that the agents would
look to the contract, including its forum-selection clause, to protect them for acts done
on the corporation’s behalf to further the contractual relationship. See, e.g., Bernstein
v. Wysoki, 907 N.Y.S.2d 49, 57–58 (N.Y. App. Div. Aug. 24, 2010). A rule barring
agents from enforcing the forum-selection clause would upset the expectations of the
agents and signatories alike, undermine the clause’s purpose to provide certainty
about where contract-related disputes will be litigated, and make it too easy for a
7 Federal appellate courts around the country have held that “a range of transaction
participants, parties and non-parties, should benefit from and be subject to forum selection
clauses,” especially when a nonparty defendant’s alleged misconduct “is closely related to the
contractual relationship.” Holland Am. Line Inc. v. Wärtsilä N. Am., Inc., 485 F.3d 450, 456
(9th Cir. 2007) (quoting Manetti-Farrow, Inc. v. Gucci Am., Inc., 858 F.2d 509, 514 n.5 (9th
Cir. 1988)); accord Franlink Inc. v. Bace Servs., Inc., 50 F.4th 432, 441 (5th Cir. 2022); Carlyle
Inv. Mgmt. LLC v. Moonmouth Co., 779 F.3d 214, 219 (3d Cir. 2015); Magi XXI, Inc. v. Stato
della Città del Vaticano, 714 F.3d 714, 722–23 (2d Cir. 2013); Marano Enters. of Kan. v.
Z-Teca Rests., L.P., 254 F.3d 753, 757–58 (8th Cir. 2001); Lipcon v. Underwriters at Lloyd’s,
London, 148 F.3d 1285, 1299 (11th Cir. 1998); Hugel v. Corp. of Lloyd’s, 999 F.2d 206, 209–
10 (7th Cir. 1993).

plaintiff to evade the clause by suing the agents rather than the corporation. See
Ellison, 207 N.C. App. at 412; Revis, 140 N.Y.S.3d at 81; see also Adams v. Raintree
Vacation Exch., LLC, 702 F.3d 436, 442 (7th Cir. 2012) (reasoning that a default rule
that allowed only the named parties to enforce forum-selection clauses “would greatly
complicate the negotiation of such clauses because the parties would have to strain
to close all the loopholes that would open if only entities named in the contract could
ever invoke or be made subject to such a clause”).
25. Plaintiffs argue that their contracts with Avaya leave no room for equitable
enforcement by nonparties. The Brigade and Canyon agreements state that they are
“intended for the benefit of all the parties hereto” and “not for the benefit of, nor may
any provision hereof provide any remedy (for enforcement, damages or otherwise) to,
any other Person.” (Brigade Agrmt. § 6.12; Canyon Agrmt. § 6.12.) Comparable
language appears in the B-3 Term Loan agreement. (See ALCOF Agrmt. § 13.6(a).)
According to Plaintiffs, this extinguishes any equitable right that Chirico and
McGrath might have as agents to enforce the forum-selection clauses.
26. At least one court applying New York law has rejected an identical
argument. As that court put it, “[t]his sort of limiting language might” affect who can
enforce a forum-selection clause as “a third party beneficiary” under ordinary
principles of contract law but not who can enforce one based on an agency or similarly
“close relationship” for equitable reasons. Bonanno v. VTB Holdings, Inc., 2016 Del.
Ch. LEXIS 24, at *24 n.83 (Del. Ch. Feb. 8, 2016). Courts in other jurisdictions with
kindred equitable rules have drawn the same conclusions. See Quintillion Subsea

Operations, LLC v. Maritech Project Servs., Ltd., 2023 U.S. Dist. LEXIS 3546, at *36–
39 (S.D. Tex. Jan. 6, 2023) (stating that “whether a party can be a third-party
beneficiary and whether it can be bound to a particular contractual provision under
the closely-related doctrine are separate inquiries”); Smith v. Swaffer, 566 F. Supp.
3d 791, 799–800 (N.D. Ohio 2021) (allowing officer of contracting party to “enforce
the forum-selection clause notwithstanding its third-party beneficiary language”);
Ashall Homes Ltd. v. ROK Ent. Grp. Inc., 992 A.2d 1239, 1248–49 (Del. Ch. 2010)
(allowing agents who solicited plaintiffs’ investments to enforce forum-selection
clause on equitable grounds despite contract language stating that no term could be
enforced by anyone other than the parties).
27. Plaintiffs do not discuss these cases. They do rely on others in which courts
cited a disclaimer of third-party rights as a reason not to let a nonparty enforce a
forum-selection clause. But Plaintiffs’ cases offer little guidance here: in none of them
was the nonparty an agent of a corporate signatory. All involved weaker or more
distant relationships that typically do not give rise to equitable rights in the first
place. See, e.g., Fiesta Mart, LLC v. ACON Invs., LLC, 2019 U.S. Dist. LEXIS 121940,
at *9–14 (S.D. Tex. June 11, 2019) (“entity sold in” transaction); Norcast S.àr.l. v.
Castle Harlan, Inc., 2014 U.S. Dist. LEXIS 1197, at *24 (S.D.N.Y. Jan. 6, 2014)
(nonparty that lacked essential element of agency); Casville Invs., Ltd. v. Kates, 2013
U.S. Dist. LEXIS 95426, at *16–18 (July 8, 2013) (shareholders); Dean St. Cap.
Advisors, LLC v. Otoka Energy Corp., 2017 U.S. Dist. LEXIS 15426, at *2–3, 13
(S.D.N.Y. Feb. 2, 2017) (unrelated “consulting services” provider); McMahan Sec. Co.

v. Aviator Master Fund, Ltd., 862 N.Y.S.2d 747, 750–52, 756 (N.Y. Sup. Ct. 2008)
(forum-selection clause that covered disputes involving “the parties” and “their . . .
agents” did not apply to “placement agent” acting as “independent contractor”).
28. Put simply, the contracts’ disclaimers of third-party rights do not suggest
that Avaya and Plaintiffs intended to bar equitable enforcement of the
forum-selection clauses by corporate agents. If there were any doubt about their
intent, other parts of the contracts would dispel it. All parties to the Brigade and
Canyon investment agreements represented that the agreements would be
“enforceable in accordance with [their] terms except as enforceability may be subject
to . . . general principles of equity.” (Brigade Agrmt. §§ 4.3, 5.3; Canyon Agrmt.
§§ 4.3, 5.3.) So did the parties to the B-3 Term Loan agreement. (See ALCOF Agrmt.
§ 8.2.) The contracts do not spurn equitable interpretation; they embrace it.
29. Thus, Chirico and McGrath may enforce the forum-selection clauses. Every
claim is based on statements that Chirico and McGrath made or actions that they
took in their capacities as Avaya’s officers and agents to induce Plaintiffs to invest in
the company. No allegations or claims arise from actions that either took in a
personal capacity. As a result, the forum-selection clauses apply, and North Carolina
is not the proper venue for these cases. See, e.g., Se. Auto., 2017 NCBC LEXIS 34, at
*39 n.14; Big League Analysis, 2016 NCBC LEXIS 68, at *21; Westaub II LLC v.
Westermann, 160 N.Y.S.3d 214, 216 (N.Y. App. Div. 2021); Hudak v. Roe, 2023 N.Y.
Misc. LEXIS 3460, at *3, *6 (N.Y. Sup. Ct. July 11, 2023).

30. Having so concluded, the Court need not and will not address whether
equitable estoppel also allows Chirico and McGrath to enforce the forum-selection
clauses. Nor will the Court decide whether Plaintiffs have adequately stated a claim;
those merits questions are for another court in another place.
III.
CONCLUSION
31. For these reasons, the Court GRANTS Chirico’s and McGrath’s motions to
dismiss. Plaintiffs’ claims against Chirico and McGrath are DISMISSED without
prejudice to their right to refile in an appropriate venue.
SO ORDERED, this the 21st day of August, 2024.
/s/ Adam M. Conrad
Adam M. Conrad
Special Superior Court Judge
for Complex Business Cases