In Re Boehme

256 S.W.3d 878, 2008 WL 2390345
CourtCourt of Appeals of Texas
DecidedJune 13, 2008
Docket14-08-00165-CV
StatusPublished
Cited by31 cases

This text of 256 S.W.3d 878 (In Re Boehme) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Boehme, 256 S.W.3d 878, 2008 WL 2390345 (Tex. Ct. App. 2008).

Opinion

OPINION

JOHN S. ANDERSON, Justice.

Relator George F. Boehme and two alleged corporate alter egos, InstantNews-Network.com, Inc. and FortBendNow, Inc., have asked in this original proceeding that we issue a writ of mandamus requiring the respondent 1 to enforce a contractual forum-selection clause by dismissing the underlying lawsuit filed by the real party in interest. We conditionally grant the petition.

BACKGROUND

On April 28, 2006, relator George F. Boehme sold a group of local newspapers to the real party in interest, ASP Westward, L.P. d/b/a Houston Community Newspaper (“HCN”). The Agreement respecting the sale included a non-compete covenant in which Boehme was not to operate or fund a newspaper and/or a “local advertising-based publication,” and could not solicit or retain HCN’s employees for employment elsewhere.

HCN brought the underlying lawsuit on January 14, 2008, charging Boehme and his alleged alter ego, relator InstantNews-Network.com (“INN”), with violating the Agreement’s non-compete covenant by publishing FortBendNow.com (“FBN”). Contemporaneously with the filing of the underlying lawsuit, HCN sought a temporary restraining order, which was granted by an ancillary judge. A hearing on HCN’s request for a temporary injunction was set for January 25, 2008. In the interim, the parties engaged in expedited discovery consisting of a document exchange and five depositions.

On January 25, 2008, the respondent presided over the hearing on HCN’s request for a temporary injunction. Following a two-day hearing, the trial court granted a temporary injunction against re-lators and restructured its docket to set the case for a prompt trial during the two-week docket beginning March 24, 2008. The injunction order was then signed on January 30th.

On February 1, 2008, two days after entry of the temporary injunction, relators requested dismissal of HCN’s lawsuit pursuant to a forum-selection clause that had been included in the Agreement. That clause provides as follows:

10.12 Forum: Service of Process. Any legal suit, action or proceeding brought *881 by any party or any of its Affiliates arising out of or based upon this Agreement shall only be instituted in any federal or state court in New York County, New York, and each party waives any objection which it may now or hereafter have to the laying of venue of any such proceeding, and irrevocably submits to the jurisdiction of such courts in any such suit, action or proceeding.

After relators moved to dismiss the underlying litigation, both Boehme and HCN filed actions in New York state court. Following two hearings, the respondent denied relators’ dismissal motion on February 25, 2008. This mandamus action followed.

STANDARD OF REVIEW

Mandamus relief will lie if the relator establishes a clear abuse of discretion for which there is no adequate remedy by appeal. In re AutoNation, Inc., 228 S.W.3d 663, 667 (Tex.2007) (orig. proceeding). A trial court clearly abuses its discretion if it reaches a decision so arbitrary and unreasonable as to constitute a clear and prejudicial error of law. Walker v. Packer, 827 S.W.2d 833, 839 (Tex.1992) (orig. proceeding). With respect to the resolution of factual issues, we will not disturb the trial court’s ruling unless the record clearly demonstrates that the trial court could reasonably have reached only one decision. See id. at 839 — 40. By contrast, review of a trial court’s determination of legal principles is much less deferential. See id. at 840. A trial court has no discretion in determining what the law is, or in applying the law to the facts; therefore, a clear failure by the trial court to analyze or apply the law correctly constitutes an abuse of discretion. Id.

FORUM-SELECTION CLAUSES

Until relatively recently, Texas courts used a different analysis than did federal courts to determine the enforceability of forum-selection clauses. See Deep Water Slender Wells v. Shell Int’l Exploration & Prod., Inc., 234 S.W.3d 679, 687 (Tex.App.-Houston [14th Dist.] 2007, pet. filed). The Supreme Court has now adopted the standard employed by federal courts. See id. Under the new standard, a trial court must presume that a mandatory forum-selection clause is valid and enforceable. Id. at 692 (citing In re AIU Ins. Co., 148 S.W.3d 109, 111-12 (Tex.2004) (orig. proceeding)). This holding comports with the principle that parties generally are free to negotiate agreements as they see fit. AutoNation, 228 S.W.3d at 668. Therefore, a trial court must give such a clause full effect absent a strong showing by the resisting party that the clause should be set aside because (1) the clause is invalid based upon reasons such as fraud, undue influence, or overweening bargaining power; or (2) enforcement would be unreasonable and unjust. Deep Water, 234 S.W.3d at 692 (citing M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10-15, 92 S.Ct. 1907, 1913-16, 32 L.Ed.2d 513 (1972)).

The trial court did not specify its reasoning for denying relators’ motion to dismiss. Nevertheless, we will uphold the order on any grounds that are supported by the record. See Luxenberg v. Marshall, 835 S.W.2d 136, 141-42 (Tex.App.Dallas 1992, orig. proceeding). HCN raises three general grounds in support of the trial court’s order. First, HCN contends that enforcement of the clause would be unjust because it would contravene a strong Texas public policy against forum shopping. Second, it argues that Boehme waived enforcement of the clause. Third, HCN urges that we apply the doctrines of laches and quasi-estoppel to deny relators’ mandamus petition.

*882 PUBLIC POLICY EXCEPTION

Enforcement of a forum-selection clause here would be unreasonable and unjust if enforcement would contravene a strong Texas public policy, or if the balance of convenience strongly favors litigation in Texas and litigation in New York would be so manifestly and gravely inconvenient to HCN that it would effectively be deprived of a meaningful day in court. See Deep, Water, 234 S.W.3d at 692-93. However, a party who seeks to avoid the effects of a forum-selection clause on the basis of unfairness carries a “heavy burden.” See Holeman v. Nat’l Bus. Inst., 94 S.W.3d 91, 97 (Tex.App.-Houston [14th Dist.] 2002, pet. denied). HCN seeks to discharge this heavy burden by arguing that, because Boehme waited until after he lost the temporary injunction hearing to seek another forum, he violated a Texas public policy against forum shopping.

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Cite This Page — Counsel Stack

Bluebook (online)
256 S.W.3d 878, 2008 WL 2390345, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-boehme-texapp-2008.