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In re Kubler

Court of Appeals of Texas, Fifth District, Dallas

August 4, 2017


         Original Proceeding from the 191st Judicial District Court Dallas County, Texas Trial Court Cause No. DC-14-09151

          Before Justices Myers, Evans, and Schenck



         In this original proceeding, relator complains of the trial court's denial of relator's motion to dismiss the intervenor's claims for lack of subject matter jurisdiction and, alternatively, the trial court's refusal to enforce a forum selection clause and refusal to dismiss based on forum non conveniens. After reviewing the petition, the real parties' responses, relator's reply, and the mandamus record, we conclude relator is entitled to relief from the trial court's refusal to enforce the forum selection clause. We conditionally grant the writ.


         Relator Bruno Kübler is the German, insolvency administrator of Thielert Aircraft, a German company that manufactures and supplies replacement aircraft engine parts. Superior Air Parts, Inc., a former customer to whom Thielert Aircraft manufactured and supplied engine parts, sued Thielert Aircraft in Dallas. Superior's lawsuit is based on a dispute over the ownership and possession of drawings and technical sheets allegedly given to Thielert Aircraft by Superior and models and drawings created by Thielert Aircraft that relate to or contain information regarding Superior ("the Property").

         After Thielert Aircraft was placed in an insolvency proceeding in Germany, Kübler negotiated the sale of Thielert Aircraft's assets to another German company, Technify Motors, GmbH. The sale was memorialized in the Business Purchase and Transfer Agreement ("the transfer agreement") and was executed in January 2013. The transfer agreement provides for jurisdiction of any disputes related to the agreement as the corporate seat of Thielert Aircraft, which is Lichtenstein, Germany. Kübler and Technify disagree on whether Germany is the exclusive place of jurisdiction.

         Before the sale to Technify closed, Superior demanded Kübler return the Property. Kübler and Technify addressed Superior's demand in a "Closing Protocol to the Business Purchase and Transfer Agreement" ("the closing protocol") that carved out the Property from the asset purchase. The closing protocol set forth the agreement between Kübler and Technify to exclude the Property from the assets transferred to Technify, noted that Kübler and Technify could not reach an agreement on the value of the Property, and provided remedies for Technify should the final decision of the Texas courts prohibit Kübler from transferring the Property to Technify. The closing protocol provides that Technify "shall have and retain any and all potential rights and claims, in particular claims for damages within the meaning of §§ 249 et seq. German Civil Code, " that Technify might have against Kübler because the Property cannot be transferred to Technify. Kübler and Technify agreed to cap damages for such a claim at 3, 500, 000.00. The closing protocol also notes that Kübler would not transfer the Property to Technify "until it has been legally finally and unappealable [sic] decided or agreed on, if and to what extent [Kübler] shall be entitled to transfer" the Property to Technify.

         Technify intervened in the underlying lawsuit between Kübler and Superior. Technify asserted a claim for declaratory judgment as to "the respective rights" of Superior, Kübler, and Technify in the Property and asserted a claim for "contract damages, " alleging that Kübler and Technify had agreed that "in the event of a legal determination that Kübler must transfer the Property" to Superior, then Technify "will have a claim for damages against Kübler." Kübler filed a motion to dismiss and plea to the jurisdiction seeking dismissal of Technify's intervention and claims, which the trial court denied.

         In this original proceeding, Kübler contends dismissal was required because (1) Technify's contract damages claim is not ripe because no judicial determination has been made as to Superior's right to the Property, (2) the transfer agreement's forum selection clause required Technify to file suit in Germany, and (3) Dallas is an inconvenient forum for a contract dispute between two German companies that is governed by German law.

         Forum Selection Clause

         Forum-selection clauses provide parties with an opportunity to contractually preselect the jurisdiction for dispute resolution. Pinto Tech. Ventures, L.P. v. Sheldon, No. 16-0007, 2017 WL 2200357, at *5 (Tex. May 19, 2017) (citing In re AIU Ins. Co., 148 S.W.3d 109, 111 (Tex. 2004) (orig. proceeding)). Mandamus relief is available to enforce forum-selection agreements because there is no adequate remedy by appeal when a trial court abuses its discretion by refusing to enforce a valid forum-selection clause that covers the dispute. In re Int'l Profit Assocs., Inc., 274 S.W.3d 672, 675 (Tex. 2009) (orig. proceeding) (per curiam).

         Forum-selection clauses are generally enforceable and presumptively valid. In re Laibe Corp., 307 S.W.3d 314, 316 (Tex. 2010) (orig. proceeding) (per curiam); In re Int'l Profit Assocs., 274 S.W.3d at 675. Failing to give effect to contractual forum-selection clauses and forcing a party to litigate in a forum other than the contractually chosen one amounts to " 'clear harassment' ... injecting inefficiency by enabling forum-shopping, wasting judicial resources, delaying adjudication on the merits, and skewing settlement dynamics...." In re Lisa Laser USA, Inc., 310 S.W.3d 880, 883 (Tex. 2010) (orig. proceeding) (quoting In re AutoNation, Inc., 228 S.W.3d 663, 667-68 (Tex. 2007) (orig. proceeding)). A party attempting to show that such a clause should not be enforced bears a heavy burden. In re Lyon Fin. Servs., Inc., 257 S.W.3d 228, 232 (Tex. 2008) (orig. proceeding) (per curiam) (citing In re AIU Ins. Co., 148 S.W.3d at 113); In re Laibe Corp., 307 S.W.3d at 316; In re ADM Inv'r Servs., Inc., 304 S.W.3d 371, 375 (Tex. 2010) (original proceeding). A trial court abuses its discretion in refusing to enforce a forum-selection clause unless the party opposing enforcement meets its heavy burden of showing that (1) enforcement would be unreasonable or unjust, (2) the clause is invalid for reasons of fraud or ...

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