Court Opinion

ID: 6226576
Source: CourtListenerOpinion
Date Created: 2022-02-17 01:00:28.092394+00
Date Added: 2024-06-11T08:57:40.037629
License: Public Domain

Case: 21-40292     Document: 00516205320         Page: 1     Date Filed: 02/16/2022

              United States Court of Appeals
                   for the Fifth Circuit
                                                                         United States Court of Appeals
                                                                                  Fifth Circuit

                                                                                FILED
                                                                         February 16, 2022
                                  No. 21-40292                             Lyle W. Cayce
                                                                                Clerk

   Lamar County Electric Cooperative Association,

                                                             Plaintiff—Appellee,

                                       versus

   McInnis Brothers Construction, Incorporated,

                                                         Defendant—Appellant.

                  Appeal from the United States District Court
                       for the Eastern District of Texas
                            USDC No. 4:20-CV-930

   Before Jones, Haynes, and Costa, Circuit Judges.
   Per Curiam:*
          This case concerns the interpretation of a forum selection clause in a
   contract entered into between Appellant McInnis Brothers Construction,
   Inc. (“McInnis”) and Appellee Lamar County Electric Cooperative
   Association (“Lamar”). Lamar sued McInnis in Texas state court for breach
   of contract, negligence, and breach of implied warranty. McInnis removed

          *
            Pursuant to 5th Circuit Rule 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   opinion should not be published and is not precedent except under the limited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 Circuit Rule 47.5.4.
Case: 21-40292        Document: 00516205320              Page: 2       Date Filed: 02/16/2022

                                         No. 21-40292

   the case to federal court based on diversity jurisdiction, and Lamar moved to
   remand. Concluding that the forum selection clause waived McInnis’s right
   to remove the case to federal court, the district court granted Lamar’s motion
   to remand. McInnis timely appealed, contending that the contract did not
   provide for waiver of removal. We AFFIRM.
           It is well known that appellate review of remand orders for lack of
   subject matter jurisdiction is precluded by 28 U.S.C. § 1447(d). But here,
   the district court predicated its remand order on a contractual forum
   selection clause. Thus, the order was “not based on lack of subject matter
   jurisdiction and is therefore outside of the statutory prohibition on our
   appellate review.” Waters v. Browning-Ferris Indus., Inc., 252 F.3d 796, 797
   (5th Cir. 2001). “Contractual remand orders are reviewable by direct
   appeal.” Id. We review the district court’s interpretation of the forum
   selection clause de novo. McDermott Int’l, Inc. v. Lloyds Underwriters of
   London, 944 F.2d 1199, 1204 (5th Cir. 1991).
           The relevant clause states: “The Judicial Court in and for the County
   of the project location, State of Texas shall have sole jurisdiction and venue
   in any action brought under this contract.”1 The parties do not dispute that
   the “project location” was in Lamar County; they also do not dispute that
   there is no federal courthouse physically located in Lamar County.2 The

           1
             McInnis points to other sections of the contract and claims that the forum
   selection clause becomes ambiguous when all the relevant clauses are read together.
   McInnis specifically relies on a clause where the parties agreed to dispute resolution in “a
   court of competent jurisdiction.” However, that clause was clearly addressing the issue of
   whether the parties would go to court or arbitration. As well, when construing contracts,
   we give effect to specific clauses over general ones. See Baton Rouge Oil & Chem. Workers
   Union v. ExxonMobil Corp., 289 F.3d 373, 377 (5th Cir. 2002).
           2
              We take judicial notice of the fact that this case was removed to the Eastern
   District of Texas, Sherman Division federal courthouse in Grayson County, some 60 miles
   away from Lamar County. See Castilleja v. S. Pac. Co., 445 F.2d 183, 185 (5th Cir. 1971).

                                                2
Case: 21-40292        Document: 00516205320              Page: 3       Date Filed: 02/16/2022

                                         No. 21-40292

   district court construed “in and for” as referring to a court that is physically
   located in the relevant county and has jurisdiction over that county. We
   examine that analysis.
           Our case law makes clear that removal rights must be clearly waived3
   and that a contract may waive removal “by explicitly stating that it is doing
   so, by allowing the other party the right to choose venue, or by establishing
   an exclusive venue within the contract.” City of New Orleans v. Mun. Admin.
   Servs., Inc., 376 F.3d 501, 504 (5th Cir. 2004). The question here, then, is
   whether the contract established Lamar County as an “exclusive venue.”
           We conclude that “in and for” is quite clear: it references the location
   (“in”) AND the jurisdiction (“for”). See All. Health Grp., LLC v. Bridging
   Health Options, LLC, 553 F.3d 397, 400 (5th Cir. 2008); Collin Cnty. v.
   Siemens Bus. Servs., Inc., 250 F. App’x 45, 52–54 (5th Cir. 2007)
   (unpublished).4 The district court judge in this case was clearly not “in”
   Lamar County, even though he had jurisdiction “for” it. The phrase
   “County of the project location” is also not ambiguous given that this project
   did not span many counties; rather, it only occurred in one—Lamar County.
   Moreover, “Judicial Court,” if unclear at all, would refer to state courts since
   Texas state courts are known as “Judicial District Courts,” whereas federal

           3
             Our case law has some inconsistencies on how ambiguous clauses interact with
   removal waiver. Compare Grand View PV Solar Two, LLC v. Helix Elec., Inc., 847 F.3d 255,
   258 (5th Cir. 2017) (“Ambiguous language cannot constitute a clear and unequivocal
   waiver.” (internal quotation marks and citation omitted)), with All. Health Grp., LLC v.
   Bridging Health Options, LLC, 553 F.3d 397, 402 (5th Cir. 2008) (“[W]hen presented with
   two reasonable, but conflicting, interpretations of a contract provision, we adopt the
   interpretation least favorable to the drafter.”). Because we conclude that the clause is not
   ambiguous, we need not address this complexity further.
           4
             At the time of Collin County, there was no federal courthouse physically in Collin
   County. 250 F. App’x at 52–53. Since then, one has opened as part of the Sherman
   Division, so a current venue “in Collin County” would include the federal district court.

                                                3
Case: 21-40292         Document: 00516205320               Page: 4      Date Filed: 02/16/2022

                                          No. 21-40292

   district courts are not referenced that way. Finally, McInnis suggests that
   the word “the” preceding “Judicial Court” creates ambiguity since there are
   two state district courts in Lamar County. But, of course, if you add the
   federal courts in the Sherman Division to that list, there would be two more
   courts, for a total of four. Moreover, because venue would be appropriate in
   either state district court, the “the” argument is unavailing.
           Accordingly, we agree with the district court’s conclusion that this
   case should be remanded to the state court “in and for Lamar County.”5
   AFFIRMED.

           5
               The Supreme Court addressed forum selection clauses in Atlantic Marine
   Construction Co. v. U.S. District Court for the Western District of Texas, 571 U.S. 49 (2013).
   While Atlantic Marine addressed the question of venue transfer from one federal court to
   another, it also addressed the issue of venue provisions pointing exclusively to state courts.
   Id. at 61. Because we conclude that the language in question clearly supports remand, we
   need not consider whether Atlantic Marine applies to remand cases. Compare Jailani v.
   QFS Transp., LLC, No. 4:20-CV-00055, 2020 WL 2847019, at *2–3 (S.D. Ind. June 2,
   2020) (concluding that Atlantic Marine’s forum non conveniens analysis applied to a
   remand analysis where the defendant moved from a “convenient” to an “inconvenient
   forum” causing the plaintiff to seek remand), with Zehentbauer Fam. Land LP v. Chesapeake
   Expl., LLC, No. 4:15-CV-2449, 2016 WL 3903391, at *3 (N.D. Ohio July 19, 2016) (holding
   that “reliance” on Atlantic Marine was “misplaced” because the case did “not concern the
   right to transfer”).

                                                 4