Opinion ID: 1288202
Heading Depth: 3
Heading Rank: 3

Heading: Scope of New Law Governing Forum Selection Clauses

Text: Not only did the majority institute new law regarding forum selection clauses on doubtful precedent, it also applied the new law by consistently turning a blind eye toward the actual facts of this case. The majority continuously repeats its assertion that the forum selection clause in the 1997 CSA is the basis for the conflicts giving rise to this lawsuit, [6] yet the majority fails to explain how Massey's conduct, conduct subsequent to Wellmore's declaration of force majeure, is related to the CSA. [7] Moreover, the trial court specifically found that Massey's actions were not connected with the 1997 CSA, a factual finding that is entitled to deference by this Court. As determined by the trial court, some of Massey's unsavory conduct was performed prior to Massey's acquisition of United, Wellmore's parent company. It was also proven that even more of Massey's unsavory conduct was performed after Massey had sold Wellmore. Despite these proven facts, the majority says that all of Massey's conduct is somehow related to the CSA. The majority improperly substitutes its own judgment without acknowledging the relevant findings of the lower court or declaring the findings of the trial court to be clearly erroneous. The majority says that [i]n the absence of the declaration of force majeure, the Harman Companies would not have been forced into bankruptcy and their prospective contractual relationships would not have been impeded by Massey. Caperton, ___ W.Va. at ____, 679 S.E.2d at 242. Not only is this argument circularthat is, in the absence of Massey's deceitful plan, Wellmore would have never declared force majeure and the Harman companies would not have been impeded by Masseybut it also does not reconcile with the facts of the case. Summarizing the findings of the circuit court, the majority noted that subsequent to Wellmore's declaration of force majeure, Massey continued in negotiations with the Harman companies and Mr. Caperton for Massey's purchase of the Harman Mine, and the parties agreed to close the transaction on January 31, 1998. However, Massey delayed and, as the circuit court found, ultimately collapsed the transaction in such a manner so as to increase [the Harman companies'] financial distress. In addition, Massey utilized the confidential information it had obtained from the Harman companies to take further actions, such as purchasing a narrow band of the Pittston coal reserves surrounding the Harman Mine, in order to make the Harman Mine unattractive to others and thereby decrease its value. During the negotiations for the sale of the Harman Mine to Massey, Massey had also learned that Mr. Caperton had personally guaranteed a number of the Harman companies' obligations. Subsequently, the Harman companies filed for bankruptcy. The majority provides no explanation whatsoever as to how these acts committed by Massey are related to Wellmore's declaration of force majeure, and the failure to do so is because they bear no relationship to Wellmore's declaration of force majeure. Using the majority's line of reasoning, had Massey not entered into sham negotiations with the Harman companies and Mr. Caperton for Massey's purchase of the Harman Mine, the Harman companies may not have been forced into bankruptcy. Or had Massey not purposefully collapsed the transaction, after multiple delays, the Harman companies may not have been forced into bankruptcy. Or had Massey not improperly used Mr. Caperton and the Harman companies' confidential information for Massey's personal benefit, the Harman companies may not have been forced into bankruptcy. To say that Massey's deceitful conduct flowed from Wellmore's declaration of force majeure is utterly unjustifiable. Wellmore's declaration may have made the Harman companies more vulnerable to this attack by Massey. However, it was Massey's subsequent actions that were the proximate cause of the Harman companies destruction. With respect to the Harman companies' claim of tortious interference with existing business relationships, the majority says Count I of the amended complaint alleges tortious interference with existing contractual relations, and specifically identifies existing contracts with Wellmore (the 1997 CSA), Penn Virginia (the lease of the Harman Coal reserves), and the UMWA (a labor contract). Certainly a claim of interference with the 1997 CSA itself is related to that contract. With respect to the Penn Virginia and UMWA contracts, it was Wellmore's declaration of force majeure that placed the Harman Companies and Mr. Caperton in the position of being unable to fulfill their contractual obligations. Caperton, ___ W.Va. at ____, 679 S.E.2d at 241. Contrary to this assertion by the majority, the trial court specifically found that it was Massey's conduct subsequent to the force majeure declaration that affected the lease of the Harman Coal reserves and the labor contract. Had Massey not engaged in its deceptive conductpretending to carry on purchase negotiations in order to gain confidential information for use against the Harman companies and Mr. Capertonwho knows what the outcome may have been. Not surprisingly, that was the question presented to the Boone County jury: had Massey not engaged its deceptive actions, what position would Mr. Caperton and the Harman companies have been in? Stated another way, what injuries did Massey inflict on Mr. Caperton and the Harman companies by engaging in its deceptive actions? Although unsupported by the evidence, the majority sweepingly states that insofar as the claims asserted in this action all flow from the allegedly wrongful declaration of force majeure, they would require interpretation of the contract to determine whether the declaration was indeed wrongful. Caperton, ___ W.Va. at ____, 679 S.E.2d at 242 n. 24. The majority inaccurately indicates that a wrongful declaration of force majeure is necessary to the claims presented in this case. According to the majority, had Wellmore rightfully declared force majeure, the Harman companies and Mr. Caperton would not have a claim against Massey. The majority's new formulation of the law now permits companies to enter into sham negotiations and thereby acquire confidential information, only to use that information to drive their competitors out of business.