In Re Nestle USA-Beverage Division, Inc.

82 S.W.3d 767, 2002 Tex. App. LEXIS 5525, 2002 WL 1759493
CourtCourt of Appeals of Texas
DecidedJuly 25, 2002
Docket13-02-00227-CV, 13-02-00259-CV
StatusPublished
Cited by15 cases

This text of 82 S.W.3d 767 (In Re Nestle USA-Beverage Division, Inc.) 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 Nestle USA-Beverage Division, Inc., 82 S.W.3d 767, 2002 Tex. App. LEXIS 5525, 2002 WL 1759493 (Tex. Ct. App. 2002).

Opinion

OPINION

Opinion by Justice HINOJOSA.

Relators, Nestle USA — Beverage Division, Inc. and Nestle USA, Inc. (collectively “Nestle”), have filed a petition for writ of mandamus in cause number 13-02-227-CV, requesting that this Court direct respondent, the Honorable Leticia Hinojosa, presiding judge of the 139th District Court of Hidalgo County: (1) to dismiss the trade secret infringement and tortious interference claims of the real party in interest, Americana Juice Imports, Inc. (“Americana”), in cause no. C-2012-99-C, or in the alternative, to grant the motion to compel further arbitration of Valle Redondo, S.A. de C.V., Confrutta, S.A. and Jugos de Hermosillo, S.A. de C.V. (collectively “the Cettos”), and (2) to vacate the June 3, 2002 trial date in said cause.

Relators, the Cettos, have filed a petition for writ of mandamus in cause number 13-02-259-CV, requesting that this Court direct respondent: (1) to vacate her April 22, 2002 order in cause number C-2012-99-C, which provides that “the issue of whether the claims set out by Nestle in its Third Party Petition against the Cettos are covered by the Indemnity Agreement involves questions of fact that must be determined by a Jury and are therefore reserved for trial,” and (2) to compel arbitration to adjudicate Americana’s declaratory judgment action and the Cettos’s cross-claims.

A. STANDARD OF REVIEW

Mandamus will issue only to correct a clear abuse of discretion when there is no adequate remedy by appeal. See Mitchell Energy Corp. v. Ashworth, 943 S.W.2d 436, 437 (Tex.1997); Walker v. Packer, 827 S.W.2d 833, 839 (Tex.1992). A trial court abuses its discretion when it does not follow guiding rules and principles and reaches an arbitrary and unreasonable decision. Walker, 827 S.W.2d at 839; Republic Royalty Co. v. Evins, 931 S.W.2d 338, 342 (Tex.App.-Corpus Christi 1996, orig. proceeding). Likewise, a trial court abuses its discretion in the following ways: (1) when it attempts to exercise a power that it does not legally possess; (2) if it declines to exercise a power of discretion vested in it by law when the circumstances require that the power be exercised; (3) if it purports to exercise its discretion without sufficient information upon which a rational decision may be made; and (4) if it exercises its power of discretion by making an erroneous choice as a matter of law in the following ways: (i) by making a choice that is not within the range of choices permitted by law, (ii) by arriving at its choice in violation of an applicable legal rule, principle, or criterion, or (iii) by making a choice that is legally unreasonable in the factual-legal context in which it is made. See Koch v. Koch, 27 S.W.3d 93, 95 (Tex.App.-San Antonio 2000, no pet.) (citing Landon v. Jean-Paul Budinger, Inc., 724 S.W.2d 931, 937-40 (Tex.App.-Austin 1987, no writ)). Mandamus is the appropriate remedy when the trial court improperly denies a motion to com *771 pel arbitration pursuant to the Federal Arbitration Act. 1 In re L & L Kempwood Assocs., L.P., 9 S.W.3d 125, 128 (Tex.1999) (per curiam); In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571, 574-75 (Tex.1999) (per curiam); EZ Pawn Corp. v. Mancias, 934 S.W.2d 87, 88 (Tex.1996).

B. BACKGROUND

The Cettos are Mexican companies which produce grape and other fruit juices in Mexico and sell the juice in international commerce. From 1989 to 1998, the Cettos exported grape juice to Americana in the United States. The Cettos ceased doing business with Americana in 1998, and began selling grape juice directly to Nestle. Americana filed suit against the Cettos in federal court on November 17, 1998, for breaching their alleged exclusive distribution agreements by selling grape juice directly to Nestle. The suit was settled in April 1999 (“the Settling Action”). As part of the settlement, Americana and the Cet-tos agreed to submit to arbitration any and all disputes and controversies related to the facts at issue in the suit.

In April 1999, Americana filed suit against Nestle complaining of Nestle’s alleged tortious interference with Americana’s exclusive relationship with the Cettos. In June 2000, Americana filed its Third Amended Petition against Nestle and Border Environmental Laboratory, Inc. (“Border”) for “misappropriation of Americana’s trade secret juice blends by either (i) purchasing the primary ingredients for the juice blends from Americana’s most important juice suppliers in order to manufacture the juice blends itself or (ii) inducing the supplier of Americana’s primary juice blend ingredient to violate its confidential relationship with Americana in order to directly obtain Americana’s trade secret juice blends manufactured using Americana’s trade secret processes.”

In December 2000, the Cettos commenced an arbitration action against Americana to preclude Americana from continuing to assert the trade secret infringement claims. On January 5, 2001, Nestle filed a Third Party Petition against the Cettos. The petition sought breach of warranty damages, indemnity damages, and declaratory relief against the Cettos with respect to Americana’s tortious interference and trade secret infringement claims. On January 12, 2001, the Cettos filed a Motion to Compel Arbitration, Plea in Abatement, and Motion for Stay in the 139th District Court. On January 18, 2001, the district court denied the motion to stay the underlying lawsuit, plea in abatement, and the motion to compel arbitration. The court also announced that it would not interrupt the arbitration between the Cettos and Americana, but it would not “[throw] this whole case into arbitration.”

In February 2001, the Cettos asked this Court for a writ of mandamus directing the respondent to sign an order in cause number C-2012-99-C, compelling arbitration and staying the suit as to the signatories of an arbitration agreement, pending the termination and outcome of the arbitration process. In our April 12, 2001 opinion, we applied the Federal Arbitration Act and stated:

In the Settling Action, Americana alleged claims and sought damages for the alleged injuries caused by the Cettos’s alleged breach of contract, fraud, tor-tious interference with contractual relations, and conspiracy. The claims were brought because the Cettos allegedly sold grape juice directly to Nestle. The settlement agreement recites that *772 “Americana commenced the Settling Action against [the Cettos] seeking enforcement of an alleged exclusive grape juice agreement.”
Americana filed the underlying suit against Nestle complaining of Nestle’s alleged tortious interference with Americana’s exclusive relationship with the Cettos.

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82 S.W.3d 767, 2002 Tex. App. LEXIS 5525, 2002 WL 1759493, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-nestle-usa-beverage-division-inc-texapp-2002.