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Grynberg v. Grynberg

Court of Appeals of Texas, Fifth District, Dallas

November 28, 2017

JACK J. GRYNBERG AND GRYNBERG PRODUCTION CORPORATION, Appellants
v.
MIRIAM Z. GRYNBERG, RACHEL S. GRYNBERG, STEPHEN M. GRYNBERG, INDIVIDUALLY AND AS TRUSTEE FOR THE STEPHEN MARK GRYNBERG SEPARATE PROPERTY TRUST; THE STEPHEN MARK GRYNBERG SEPARATE PROPERTY TRUST; CELESTE C. GRYNBERG; AND PRICASPIAN DEVELOPMENT CORPORATION, Appellees

         On Appeal from the 193rd Judicial District Court Dallas County, Texas Trial Court Cause No. DC-16-02969

          Before Justices Bridges, Fillmore, and Stoddart.

          MEMORANDUM OPINION

          CRAIG STODDART, JUSTICE.

         This is an appeal from the trial court's order granting a motion to dismiss based on forum non conveniens filed by appellee Pricaspian Development Corporation. In three issues, appellants Jack J. Grynberg and Grynberg Production Corporation argue the trial court abused its discretion by granting the motion to dismiss. The central issue in this appeal is whether the trial court abused its discretion by concluding the parties' dispute should be litigated in Colorado rather than in Texas. We affirm the trial court's order.

         Factual Background

         Jack Grynberg[1] formed Pricaspian, a Texas corporation, in 1993 to hold mineral-related assets and provide funds to other ventures engaged in mineral exploration and production. Jack caused Grynberg Production Corporation (GPC), his wholly-owned entity, to assign rights arising out of his oil and gas projects in the Republic of Kazakhstan to Pricaspian.

         Eventually Jack assigned shares of Pricaspian to his wife, appellee Celeste Grynberg, and their three children, appellees Miriam Grynberg, Rachel Grynberg, and Stephen Grynberg[2](collectively, Children). Celeste and the Children also became directors of Pricaspian. Jack, Celeste, Miriam, and Rachel are residents of Colorado. Stephen is a resident of California. Although it is a Texas corporation, Pricaspian maintains its offices and records in Colorado. In an affidavit filed with the trial court, Jack averred: "I have maintained control of the shares within the Pricaspian corporate books at the Office [in Colorado], and have maintained control of the direction and governance of Pricaspian represented by the Pricaspian shares."

         Affidavits and exhibits filed by the Children show that on September 8, 2015, the Pricaspian board of directors held a meeting in Denver, Colorado, where the board voted to remove Jack as an authorized signatory on Pricaspian's bank accounts and install the Children as signatories. Miriam's affidavit states that "[a]s a result of that vote, the board drafted, in Colorado, and transmitted, from Colorado, correspondence to each bank-none of which are [sic] either incorporated or headquartered in Texas-informing the banks of the board's actions." The board held another meeting on February 24, 2016, in Colorado at which it voted to remove Jack as president of Pricaspian and appoint Rachel and Stephen as co-interim CEOs. Jack was appointed to a newly created position of Chairman Emeritus of the Corporation. On March 24, 2016, the Pricaspian board held a meeting in Colorado at which it passed resolutions reducing the number of seats on the board from five to four and removing Jack from the board. Miriam and Rachel each stated in their affidavits that "[a]ny and all actions I have taken in my role as a director and shareholder of Pricaspian occurred in Colorado or other locations outside of Texas." Stephen made a similar statement in his affidavit.[3]

         On March 14, 2016, Jack sent letters to each of the Children and Celeste on Pricaspian's letterhead, which shows an address in Colorado, informing the recipients that their shares in Pricaspian were revoked and Jack had filed a lawsuit in Texas for declaratory relief to confirm the revocation. The letters were sent to Rachel, Miriam, and Celeste at addresses in Colorado and Stephen in California. Another letter was sent to Rachel, as Pricaspian's secretary, revoking the assignment of shares from GPC to Pricaspian. This letter also was sent on Pricaspian's letterhead, showing its address in Colorado, to Rachel's address in Colorado. Rachel, in her capacity as secretary of Pricaspian, received a similar letter on GPC's letterhead. This letter also shows GPC's and Rachel's addresses in Colorado.

         Appellants sued appellees in Texas claiming Jack originally transferred ownership in Pricaspian to Celeste and the Children on the condition that Jack would control and operate Pricaspian until his death. Appellants allege "[t]hat arrangement and agreement, which was honored by the Children and Celeste for over twenty (20) years without any dispute or question whatsoever, has resulted in the payment of approximately $160 million dollars [sic] to the Children and Celeste over the years." The petition alleges the parties' dispute arose after Celeste and the Children violated the condition of Jack's gift. Appellants assert the Children "inserted themselves into Pricaspian's banking relationships" and began "attempting to assert control over and/or interfere with the operations and personnel" in Jack's office. Appellants further allege Celeste and the Children have "deliberately interfered with Pricaspian's cash assets and bank accounts . . . including attempting to remove [Jack] from Pricaspian's bank accounts without any notice and attempting to wire all but $65 million of Pricaspian's cash reserves to the IRS." Appellants sought a declaratory judgment and asserted causes of action for breach of contract and breach of fiduciary duty. Appellants also sought the imposition of a constructive trust.

         Shortly after the instant suit was filed, appellees filed a lawsuit against Jack, GPC, and others in Colorado. The Colorado litigation is ongoing.

         Pricaspian filed a motion to dismiss this lawsuit based on forum non conveniens. In the motion, it argued the only connection this lawsuit has to Texas is that Pricaspian is incorporated in Texas. Otherwise, the motion states, "virtually every other party, witness, office, and document related to this lawsuit can be found within a twenty-mile radius of Denver, Colorado." Arguing no material event relating to the case occurred in Texas, Pricaspian moved that the case should be litigated in Colorado. The trial court granted the motion and this appeal followed.

         Law & Analysis

         The doctrine of forum non conveniens allows a court to exercise equitable powers to avoid imposition of an inconvenient jurisdiction on a litigant based on a court's determination that the convenience of litigants and witnesses and the interests of justice warrant litigating the matter in another forum. RSR Corp. v. Siegmund, 309 S.W.3d 686, 710 (Tex. App.-Dallas 2010, no pet.). Dismissal on the grounds of forum non conveniens is appropriate when there are sufficient contacts between the defendant and the forum state to confer personal jurisdiction upon the trial court, but the case ...


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