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Ulysses Asset Sub I, LLC v. Sinclair Holdings, LLC

Court of Appeals of Texas, Second District, Fort Worth

October 10, 2019

Ulysses Asset Sub I, LLC, Appellant
Sinclair Holdings, LLC, Appellee

          On Appeal from the 352nd District Court Tarrant County, Texas Trial Court No. 352-300659-18

          Before Kerr, Birdwell, and Bassel, JJ.



         I. Introduction

         This is an interlocutory appeal from the dissolution of an agreed temporary injunction. Appellee Sinclair Holdings, LLC owns a ninety-year-old sixteen-story building (the Sinclair Building) in downtown Fort Worth on which it has spent tens of millions of dollars on renovations to transform the building into a hotel. Appellant Ulysses Asset Sub I, LLC holds an easement that allows its lessees to place antennas for wireless communication on the roof of the Sinclair Building. The parties agreed to a temporary injunction after Ulysses sued claiming that Sinclair's construction plans would interfere with Ulysses' rights to utilize the roof and would disrupt the ability of the existing antennas on the roof to transmit emergency calls. That agreed temporary injunction permitted certain construction activities on the roof to go forward but prohibited the construction of a rooftop bar.

         After several events occurred, including the relocation of a large air-conditioning cooling tower from the roof to an alley and the relocation of the antennas (of the only entity that had antennas located on the roof) on the parapet wall surrounding the roof, Sinclair moved to dissolve the temporary injunction. Ulysses objected to Sinclair's efforts to dissolve the agreed temporary injunction. The trial court conducted an evidentiary hearing, found that the circumstances existing at the time of the entry of the temporary injunction had changed, and dissolved the temporary injunction.

         Ulysses raises two issues challenging that decision. We hold that based on the facts developed at the hearing, the trial court acted within its discretion to dissolve the temporary injunction. We therefore affirm.

         II. Factual and Procedural Background

         A. Sinclair's plans to renovate the Sinclair Building were met with opposition from Ulysses.

         As alluded to above, the dispute involves the roof of the Sinclair Building. Sinclair acquired title to the building in 2013. Sinclair's predecessor-in-title had granted a party affiliated with Ulysses a "wireless communication easement and assignment agreement" (the Easement Agreement) over the "building portion of the Property." The Easement Agreement also conveyed use as necessary for Ulysses to comply with its obligations under two preexisting leases. AT&T is a lessee under one of the preexisting leases.

         In 2017, after a two-and-a-half-year approval process, Sinclair began renovating the Sinclair Building to transform it into a hotel. The renovation included structural and safety work on the roof, as well as plans for the construction of a rooftop bar. In 2018, Sinclair negotiated with Ulysses and proposed relocating AT&T's equipment so that Sinclair could construct the rooftop bar. Ulysses rejected the proposal, citing various sections of the Easement Agreement. Sinclair responded by informing Ulysses that it was going to shut down power to the Sinclair Building and proceed with construction anyway. Ulysses sent Sinclair a letter stating that this action would constitute a breach of the Easement Agreement. Despite Ulysses' letter, Sinclair went forward with shutting down power to the Sinclair Building and with removing a portion of AT&T's equipment from the roof.

         Ulysses responded by suing Sinclair for breach of the Easement Agreement. Ulysses sought a temporary restraining order (TRO) and injunctive relief, arguing that a TRO was necessary to prevent the interruption of emergency 911 calls and first-responder and rescue services.

         B. The trial court entered an agreed temporary injunction.

         The trial court granted the TRO and scheduled a temporary-injunction hearing. Before the temporary-injunction hearing occurred, the parties filed a joint motion for the trial court to enter an agreed temporary injunction. In accordance with the joint motion, on July 18, 2018, the trial court signed a temporary injunction that initially recited the nature of the irreparable injury that it claimed would result from Sinclair's construction of the proposed rooftop bar:

[Ulysses] and [Sinclair] are parties to a Wireless Communication Easement and Assignment Agreement (the "Easement Agreement") that is the subject of this dispute. [Ulysses] has alleged that immediate and irreparable injury, loss[, ] and damage will result to [Ulysses] if [Sinclair] is allowed to proceed with certain construction on the Premises prior to a final adjudication of [Ulysses'] rights under the Easement Agreement. [Ulysses] alleges that such damage includes, without limitation, the potential interruption of telecommunications services that could, in turn, affect emergency 911 calls, first[-]responder and rescue services, and damage to customer relationships and destruction of leasing opportunities.

         The temporary injunction then described how it would protect Ulysses and recited, in part, that the removal of the AT&T equipment could interrupt emergency 911 calls and first-responder and rescue services:

Only the entry of a Temporary Injunction will serve to adequately protect [Ulysses'] alleged rights under the Easement and prevent imminent and irreparable injury that [Ulysses] alleges may arise in the event the people using AT&T wireless services in and around downtown Fort Worth are unable to place 911 emergency calls and receive first[-] responder and rescue services, such as local police, fire[, ] and ambulance services.

         The temporary injunction further stated that although Sinclair denied Ulysses' allegations,

the parties have sought to resolve the immediate issue in such a manner that would allow necessary construction rooftop work to be performed without any interruption in cellular transmission service and/or to satisfy [Ulysses] that there will be no harm to [Ulysses'] alleged Easement Agreement rights. Following the issuance of the TRO, the parties continued these discussions, and the Court understands that the parties have come to an agreement on the terms of a limited injuncti[on] [that] protects [Ulysses'] interests while allowing [Sinclair] to perform certain rooftop construction efforts. Accordingly, the parties request that the Court enter a limited injunction, and the Court finds that such a limited injunction is appropriate[.]

         Thus, the trial court enjoined Sinclair from constructing the rooftop bar (with the exception of constructing certain drains) while specifically allowing Sinclair to (1) temporarily relocate AT&T's antennas at Sinclair's cost; (2) complete structural steel work on the roof; (3) replace the roof membrane; and (4) complete other work related to the safety, repair, and maintenance of the roof.

         The temporary injunction set the case for trial during the week of May 13, 2019, and concluded with the statement, "Nothing in this agreement shall bar either party from seeking rescission or modification of this order."

         C. Sinclair moved to dissolve the temporary injunction.

         Several months after the temporary injunction was signed, Sinclair filed a motion to dissolve it. Sinclair argued that since the entry of the temporary injunction, two things had occurred. First, the motion recounted the work that had been done:

It has been more than three months since the Court issued the Temporary Injunction. In that time[, ] Sinclair has performed much work on the roof, which has involved dozens of construction works performing extensive steelwork to reinforce the structure. . . . Sinclair also relocated the mechanical HVAC units from the roof to newly-constructed platforms in the alley next to the Property. . . . Additionally, Sinclair worked with AT&T to move the cellular antennas a few feet on the exterior of the roof's parapet wall[] and moved a rack of telecommunication equipment to the interior easement space on the eighth floor of the Property. . . . None of this work damaged AT&T's equipment or interfered with AT&T's ce lular network. Indeed, there has been no indication that anyone-let alone first responders in emergencies-experienced any interruption in cellular service as a result of this construction.

         Second, the motion stated, "Since the Temporary Injunction was issued, Sinclair has been able to examine the AT&T Lease more closely. This document confirms that AT&T is the only wireless provider whose equipment could be on the roof of the Property until 2032-at the earliest." In other words, further study of a document- which Sinclair apparently had in its possession before agreeing to the injunction- produced this revelation. Thus, according to Sinclair, the two bases for the temporary injunction were no longer an issue.

         D. The trial court held an evidentiary hearing on Sinclair's motion to dissolve.

         The trial court conducted an evidentiary hearing on Sinclair's motion to dissolve and heard testimony from a representative of each party.

         The relocation of AT&T's antennas and of other equipment previously located on the roof was one focus of the testimony. The evidence demonstrated that the antennas had been relocated to the parapet wall surrounding the roof. The antennas were relocated by a contractor for AT&T after the temporary injunction was entered. Units powering the antennas had also been moved with the approval of AT&T. The antennas and the units powering ...

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