DFW Aviation, LLC v. Mansfield Heliflight, Inc.

District Court, W.D. Texas·Decided September 24, 2019·No. 1:19-cv-00481·Unknown

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS DIVISION

DFW LLC F/K/A § RED AVIATION LLC, § Plaintiff § § Case No. 1:19-CV-481-LY v. § § MANSFIELD HELIFLIGHT, INC. § Defendant

REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE

TO: THE HONORABLE LEE YEAKEL UNITED STATES DISTRICT JUDGE

Before this Court are Defendant’s Motion to Dismiss Plaintiff’s Complaint Pursuant to Federal Rules of Civil Procedure 12(b)(3) and 12(b)(6), filed on May 30, 2019 (Dkt. No. 6); Plaintiff’s Memorandum in Opposition to Defendant’s Motion to Dismiss, filed on June 27, 2019 (Dkt. No. 10); and Defendant’s Response to Plaintiff’s Memorandum in Opposition to Defendant’s Motion to Dismiss, filed on July 5, 2019 (Dkt. No. 11). On July 9, 2019, the District Court referred the above motion to the undersigned Magistrate Judge for Report and Recommendation pursuant to 28 U.S.C. § 636(b)(1)(B), Federal Rule of Civil Procedure 72 and Rule 1(d) of Appendix C of the Local Rules of the United States District Court for the Western District of Texas (“Local Rules”). I. BACKGROUND On August 28, 2018, DFW Aviation, LLC f/k/a Red Aviation, LLC (“DFW”), a Delaware corporation with its principal place of business in Addison, Texas, and Mansfield Heliflight, Inc. (“Mansfield”), a Vermont corporation with its principal place of business in Milton, Vermont, entered into an Aircraft Engine Purchase Agreement (the “Agreement”) in which Mansfield agreed to purchase two used Rolls Royce BR710-700 aircraft engines (MSN 12456 and MSN 12114) from DFW for the purchase price of $3.6 million. See Exh. A. to Dkt. No. 1. The Agreement further provided that DFW would loan Mansfield certain parts and equipment for the purposes of installing the engines for a period of 60 days “free of charge in [sic] an as-is basis, after which time the parts and equipment were to be returned to DFW at Mansfield’s sole expense and risk.” Dkt. No. 1 at ¶ 8. In the event the parts and equipment were not returned within 60 days, Mansfield

agreed to pay DFW daily rent in an amount set forth in Schedule 1 of the Agreement. Id. at ¶ 9. If the parts and equipment were not returned within 120 days, Mansfield agreed to purchase the parts and equipment and pay DFW the “Outright Value” of the same as provided for in the Agreement. Id. at ¶ 10. The Agreement further provided that a failure by Mansfield to make any of the required payments or observe any other covenant or obligation of the Agreement would constitute default. Id. at ¶ 11. DFW alleges that it provided all the necessary parts and equipment to Mansfield “per the parties’ Agreement.” Id. at ¶ 14. DFW alleges that Mansfield accepted the delivery of the parts and equipment, “and has utilized the same for its own use and benefit.” Id. at ¶ 16. DFW alleges

that although more than 120 days have passed since it delivered the parts and equipment to Mansfield, “Mansfield has failed to return the loaned parts and equipment, failed to make any payment of daily rent due under the Agreement and subsequent agreements between the parties, and failed to provide payment to DFW for the purchase of the parts and equipment as required by the Agreement and subsequent agreements between the parties.” Id. at ¶ 19. DFW alleges that “Mansfield’s non-payment of daily lease fees and purchase price payments, as well as its wrongful and continuing possession of the equipment and parts, has rendered it in breach under the parties’ Agreement and subsequent agreements between the parties.” Id. at ¶ 20. On May 3, 2019, DFW filed the instant lawsuit against Mansfield in the Western District of Texas, on the basis of diversity jurisdiction under 28 U.S.C. § 1332(a), alleging breach of contract, unjust enrichment, conversion, replevin, promissory estoppel, and foreclosure of lien under § 70.300 of the Texas Property Code. DFW alleges that it has been damaged “in an amount in excess of $75,000 to be determined at trial.” Id. at ¶ 25. DFW’s Complaint alleges that

“[j]urisdiction and venue are also proper pursuant to the parties’ Aircraft Engine Purchase Agreement which underlies this dispute and provides that each party consents to the jurisdiction of any court in the state of Texas.” Id. at ¶ 4. On May 30, 2019, Mansfield filed the instant Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(3), arguing that this case should dismissed because “venue for this action is not proper in the Western District of Texas.” Dkt. No. 6 at p. 1. Mansfield argues that it never agreed to venue in the Western District of Texas. Mansfield further argues that venue in the Western District is improper under the general venue statute, 28 U.S.C. § 1391(b). Alternatively, Mansfield moves to dismiss DFW’s claims for failure to state a claim under Federal Rule of Civil

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DFW Aviation, LLC v. Mansfield Heliflight, Inc., (W.D. Tex. 2019).

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