in Re Mark Fisher and Reece Boudreaux

433 S.W.3d 523, 57 Tex. Sup. Ct. J. 504, 2014 Tex. LEXIS 379, 2014 WL 801160
CourtTexas Supreme Court
DecidedFebruary 28, 2014
Docket12-0163
StatusPublished
Cited by76 cases

This text of 433 S.W.3d 523 (in Re Mark Fisher and Reece Boudreaux) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
in Re Mark Fisher and Reece Boudreaux, 433 S.W.3d 523, 57 Tex. Sup. Ct. J. 504, 2014 Tex. LEXIS 379, 2014 WL 801160 (Tex. 2014).

Opinion

Justice JOHNSON

delivered the opinion of the Court.

After Nighthawk Oilfield Services, Ltd. acquired Richey Oilfield Construction, Inc. from Mike Richey, the business did not go as well as the parties had hoped and Rich-ey filed suit in Wise County against two Nighthawk executives. In this mandamus proceeding we consider whether the trial court abused its discretion by failing to enforce venue selection clauses in the acquisition documents. Concluding that it did, we conditionally grant relief.

I. Background

On May 3, 2007, Mike Richey sold his interest in Richey Oilfield Construction, Inc. (Richey Oil), an oilfield services company that he founded and operated, to Nighthawk Oilfield Services, Ltd. (Nighthawk) for $33 million. NOSGP, L.L.C. was Nighthawk’s general partner and Mark Fisher and Reece Boudreaux were limited partners.' The transaction resulted in Richey Oil becoming a wholly-owned Nighthawk subsidiary, with Richey remaining employed as president of Richey Oil and becoming a limited partner in Nighthawk.

‘ The primary agreements regarding the transaction were a Stock Purchase Agreement, an agreement for the purchase of Richey Oil’s goodwill (the Goodwill Agreement), and a Promissory Note. Each contained a clause naming Tarrant County as the venue for state court actions.

In the Stock Purchase Agreement, NOS-ROC, Inc. 1 agreed to pay Richey $13 million in cash for Richey Oil’s issued,and outstanding stock. That agreement contained the following provision:

Jurisdiction; Service of Process. Any proceeding arising out of or relating to this Agreement may be brought in the courts of the State of Texas, Tarrant County, or if it has or can acquire jurisdiction, in the United States District Court for the Northern District of Texas, and each of the parties irrevocably submits .to the non-exclusive jurisdiction of each such court in any such proceeding, waives any objection it may now or hereafter have to venue or to convenience of forum, agrees that all claims in *526 respect of the proceeding may be heard and determined in any such court and agrees not to bring any proceeding arising out of or relating to this Agreement in any other court. (Emphasis added)

In the Goodwill Agreement, Richey sold his goodwill interest to Nighthawk. That interest was defined as his “right, title and interest in and to all of [Richey’s] knowledge, experience and rights relating to the Business, and [Richey’s] personal relationships and experience with the customers of the Business and further including the trade name ‘Richey’ to the extent and as used in conjunction with the Business.” The Goodwill Agreement provided that Richey would receive $7 million in cash, a $6.5 million promissory note, and $6.5 million in Nighthawk limited partnership interest units. The Goodwill Agreement contained the same venue selection clause as the Stock Purchase Agreement.

The $6.5 million promissory note (the Note) was signed by Fisher as president of Nighthawk. It provided that “[Nighthawk] ... irrevocably agrees that any legal proceedings in respect of this note ... or other writing relating hereto shall be brought in the district courts of Tarrant County, Texas, or the United States District Court for the Northern District of Texas.”

A month after Nighthawk purchased Richey Oil, Nighthawk made a $20 million “special distribution” to its partners. The distribution was contemplated in the Goodwill Agreement, which provided: “[I]t has been represented to [Richey] that a distribution to the owners or holders of all units of [Nighthawk] is' anticipated to be made contemporaneously with or subsequent to the Closing and [Richey] shall participate in such distribution on a pro rata basis.”

Six months later, Richey paid $1 million to Nighthawk at Fisher’s request. According to Richey, Fisher related that he was seeking similar amounts from all the limited partners, Nighthawk would treat the money as loans, and in six months the loans plus ten percent would be paid back. Fisher claims that the other limited partners made similar contributions totaling $3.9 million, but they agreed that those contributions would be treated as equity, not loans.

Richey asserts that when he asked Fisher to repay the $1 million as agreed, Fisher denied his request and claimed the money was a capital contribution for which Richey would receive preferred equity units. Richey has never been repaid the $1 million.

In connection with the acquisition, Nighthawk opened a controlled-disbursement account so Richey Oil could access Nighthawk’s revolving line of credit. As part of that process, Richey and Fisher executed a Deposit Account Signature Card at Bank of America that gave Richey check signing authority. In May and June 2009, Fisher authorized Richey to pay Richey Oil vendors from the account. However, when Richey did so, Bank of America rejected several of the checks for insufficient funds in the account. According to Rich-ey, Fisher told some payees of the rejected checks that Richey created the problem. Several payees referred their returned checks to collection agencies, attorneys, and authorities, who sent demand letters threatening civil and criminal prosecution. Shortly thereafter, Nighthawk and Richey Oil filed for bankruptcy.

Richey soon sued Fisher and Boudreaux in Wise County where Richey resided. He sued both of them for breach of fiduciary duty, common law fraud, statutory fraud, and violations of the Texas Securities Act. He sued Fisher separately for defamation, common law fraud, negligent misrepresentation, and interference with prospective *527 business relations related to the statements Fisher allegedly made to him about availability of money in the Richey Oil account and communications made to third parties regarding the returned checks. He sued Boudreaux separately for aiding and abetting Fisher’s breaches of fiduciary duty, acts of fraud, and violations of the Texas Securities Act.

Fisher and Boudreaux responded by moving the trial court to transfer venue to Tarrant County or dismiss the suit pursuant to the mandatory venue selection clauses in the Stock Purchase Agreement and the Goodwill Agreement. They also argued that Richey lacked standing to recover damages to his reputation or goodwill because he had conveyed those rights to Nighthawk in the Goodwill Agreement and many of his other claims belonged to Nighthawk and could only be brought by the Nighthawk bankruptcy trustee.

The trial court denied Fisher’s and Bou-dreaux’s motions and pleas to the jurisdiction. They then sought, but were denied, mandamus relief from the court of appeals. 433 S.W.3d 574, 2012 WL 299546 (Tex.App.-Fort Worth 2012, orig. proceeding). In this Court Fisher and Boudreaux (collectively, Relators) argue that Richey lacks standing because his claims actually belong to Richey Oil or Nighthawk and must be brought by the bankruptcy trustee; some of Richey’s claims seek recovery of debts owed to him by Nighthawk and must be filed as claims against Nighthawk in bankruptcy court; and the trial court abused its discretion by failing to enforce the mandatory venue agreement under the major transaction statute, Texas Civil Practice and Remedies Code § 15.020.

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Cite This Page — Counsel Stack

Bluebook (online)
433 S.W.3d 523, 57 Tex. Sup. Ct. J. 504, 2014 Tex. LEXIS 379, 2014 WL 801160, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-mark-fisher-and-reece-boudreaux-tex-2014.