Court Opinion

ID: 4321988
Source: CourtListenerOpinion
Date Created: 2018-10-18 00:00:59.457204+00
Date Added: 2024-06-11T14:46:13.083230
License: Public Domain

Case: 17-20717      Document: 00514686694         Page: 1    Date Filed: 10/17/2018

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT

                                      No. 17-20717                  United States Court of Appeals
                                                                             Fifth Circuit

                                                                           FILED
                                                                     October 17, 2018
SULTANA ENTERTAINMENT, L.L.C.,
                                                                      Lyle W. Cayce
              Plaintiff - Appellant                                        Clerk

v.

ELISEO ROBLES GUTIERREZ; ISRAEL GUTIERREZ LEIJA; MANOLO
ROBLES PEREZ,

              Defendants - Appellees

                   Appeal from the United States District Court
                        for the Southern District of Texas
                              USDC No. 4:17-CV-702

Before STEWART, Chief Judge, and DENNIS and WILLETT, Circuit Judges.
PER CURIAM:*
       Before us is an appeal from the district court’s enforcement of the parties’
forum selection clause through its dismissal of this case under Federal Rule of
Civil Procedure 12(b)(6) and the doctrine of forum non conveniens. Because,
as explained below, we lack the benefit of any analysis from the district court
in its order of dismissal, we REMAND for the district court to explain its

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
    Case: 17-20717     Document: 00514686694      Page: 2    Date Filed: 10/17/2018

                                  No. 17-20717
reasons, including any findings and analysis relevant to its forum non
conveniens determination, within 30 days of this order.
      Sultana Entertainment, LLC (Sultana), an artist management company,
sued the members of musical group La Leyenda individually (Defendants) in
Texas state court, alleging breach of contract and unfair competition, and
seeking declaratory and injunctive relief. Defendants removed to the Southern
District of Texas based on diversity of citizenship, as all Defendants reside in
Mexico. Defendants then moved for dismissal pursuant to a representation
agreement. The representation agreement’s forum selection clause states, as
translated from Spanish and attached to Defendants’ motion:
            For interpretation nor [sic] compliance purposes or
            any other circumstance in connection to this
            agreement, the parties agree being subject to the laws
            of the State of Nuevo Leon, Mexico and to the
            Jurisdiction and Competence of the Court of
            Monterrey, N.L., waiving any other venue which could
            correspond to them by reason of its present or future
            address.
The district court signed the proposed order attached to Defendants’ motion to
dismiss, which, in its entirety, states: “After considering [the Defendants’]
Motions to Dismiss for Forum Non Conveniens and to Dismiss Pursuant to
Rule 12(b)(6), Defendants’ brief in support, the relevant law and facts, and
[Sultana’s] response, the Court GRANTS the motion and DISMISSES
[Sultana’s] suit without prejudice.”
      Dismissals based on forum non conveniens are subject to mixed appellate
review. “We review the district court’s interpretation of the [forum selection
clause] and its assessment of that clause’s enforceability de novo,” but “review
for abuse of discretion the [district] court’s balancing of the private- and public-
interest factors.” Weber v. PACT XPP Techs., AG, 811 F.3d 758, 767–68 (5th
Cir. 2016). We review dismissal under Rule 12(b)(6) de novo, “accepting all

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                                       No. 17-20717
well-pleaded facts as true and viewing those facts in the light most favorable
to the plaintiff.” Bustos v. Martini Club Inc., 599 F.3d 458, 461 (5th Cir. 2010)
(internal quotation marks omitted).
       In the context of dismissal for forum non conveniens, the district court’s
lack of explanation for its determination that the action should be dismissed
poses a special problem.          Although there is generally no “inflexible rule
requiring district courts to file a written order explaining their decisions,”
Peteet v. Dow Chem. Co., 868 F.2d 1428, 1436 (5th Cir. 1989), we have held
that, in the context of a motion to dismiss for forum non conveniens, “[i]t is an
abuse of discretion for a district court to grant or deny” such a motion “without
written or oral explanation,” including “address[ing] and balanc[ing] the
relevant principles and factors of the doctrine.” In re Lloyd’s Register N. Am.,
Inc., 780 F.3d 283, 290 (5th Cir. 2015) (cleaned up); see also In re Air Crash
Disaster Near New Orleans, La., 821 F.2d 1147, 1166 (5th Cir. 1987) (en banc),
vacated on other grounds sub nom. Pan Am. World Airways, Inc. v. Lopez, 490
U.S. 1032 (1989), reinstated in part by In re Air Crash Disaster Near New
Orleans, La., 883 F.2d 17 (5th Cir. 1989) (en banc) (“[A] district court abuses
its discretion when it fails to address and balance the relevant principles and
factors of the doctrine of forum non conveniens.”). In light of this binding
precedent, we cannot affirm the district court’s dismissal on forum non
conveniens grounds based on the current record. 1

       1Although Defendants argue that the district court’s dismissal is also justified under
Rule 12(b)(6), we decline to pass on this issue at this time. Whether Rule 12(b)(6) is a valid
mechanism to enforce a forum selection clause is an issue of first impression in this Circuit.
The Supreme Court held in Atlantic Marine Construction Co. v. U.S. District Court for
Western District of Texas, 571 U.S. 49, 61 (2013), that “the appropriate way to enforce a
forum-selection clause pointing to a state or foreign forum is through the doctrine of forum
non conveniens.” However, the Court in Atlantic Marine declined to address whether
dismissal under Rule 12(b)(6) could also be used to enforce forum selection clauses, such that
some circuits have continued to allow this practice after Atlantic Marine. See Weber v. PACT
XPP Techs., AG, 811 F.3d 758, 767–68 (5th Cir. 2016) (noting the First Circuit’s continued
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                                      No. 17-20717
       Accordingly, a limited remand is appropriate to allow the district court
the opportunity to explain its reasons for dismissal. We therefore REMAND
with instructions that the district court enter its reasons for dismissal within
thirty days of this order. After entry of such reasons, the case will be returned
to this panel, which retains jurisdiction during the pendency of this limited
remand.

adherence to the “Rule 12(b)(6) method of [forum selection clause] enforcement instead of the
Supreme Court’s recommended [forum non conveniens] approach”). However, the Fifth
Circuit has never adopted a rule allowing enforcement of forum selection clauses through
Rule 12(b)(6). See id.

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