Fintech Fund, F.L.P. v. Ralph Horne ( 2020 )

Case: 18-20449 Document: 00515633793 Page: 1 Date Filed: 11/10/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
No. 18-20449 November 10, 2020
Lyle W. Cayce
FINTECH FUND, F.L.P., Clerk
Plaintiff–Appellant Cross-Appellee,
v.
RALPH HORNE,
Defendant–Appellee Cross-Appellant.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:18-CV-1125
Before OWEN, Chief Judge, and JONES and STEWART, Circuit Judges.
PRISCILLA R. OWEN, Chief Judge:*
Fintech Fund, F.L.P. appeals the district court’s forum non conveniens
dismissal of this case. Ralph Horne cross-appeals, asserting that the district
court did not have personal jurisdiction over him. Because the district court
properly exercised jurisdiction over Horne, and the parties agreed to pursue
these claims in the United Kingdom, we affirm.
*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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH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.
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I
Plaintiff Fintech Fund, F.L.P. is a Texas limited partnership that
licenses biometric verification technology. Fintech’s principal place of business
is in Sugar Land, Texas. Prior to this suit, Fintech licensed that technology to
its U.K. affiliate, CrossVerify Ltd. Defendant Ralph Horne, a U.K. citizen, was
the former CEO of CrossVerify.
According to Fintech, Horne failed to deliver as CrossVerify’s CEO.
Fintech alleges that immediately prior to becoming CEO, Horne met with
several individuals interested in starting a new company that would utilize the
trade secrets that Horne learned through his employment with CrossVerify.
Then, about six months after that meeting, Horne allegedly “deceived Fintech
into giving him access to Fintech’s servers by stating that he needed to perform
a security audit of the servers.” Horne contacted Fintech through calls and
emails to Marcus Andrade, a limited partner of Fintech responsible for its
management. Fintech alleges those calls and emails were fraudulent because
no security was needed. After Andrade gave Horne access to Fintech’s server,
Horne and his associates allegedly downloaded “highly confidential and
proprietary information belonging to Fintech.” Fintech terminated the license
with CrossVerify, and, approximately two weeks later, Horne resigned as CEO
of CrossVerify.
The day after Horne resigned, Fintech sued him in federal district court
in Houston, Texas. Fintech sued under the Computer Fraud and Abuse Act 1
(CFAA) and the Defend Trade Secrets Act 2 (DTSA), alleging that Horne, or
someone acting in concert with him, accessed Fintech’s servers based in the
United States and downloaded confidential information.
1 18 U.S.C. § 1030(g).
2 18 U.S.C. § 1836(b)(1).
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As a part of his employment, Horne signed a “Non-Disclosure,
Confidentiality, Inventions, and Non-Solicitation Agreement” (the
Agreement). The Agreement contained three provisions related to where suits
between the parties should be brought. First, Section 12(A) contained an
arbitration clause:
12. Arbitration and Dispute Resolution
A. Except for any claims against [Fintech], all disputes,
controversies or claims arising out of or relating to this Agreement
(including for any breach, invalidity or interpretation of this
Agreement), any non-contractual obligations arising out of or in
connection with this Agreement, the relationship between Horne
and [CrossVerify], services performed for or on behalf of
[CrossVerify], shall be finally adjudicated by arbitration under the
London Court of International Arbitration (“LCIA”) Rules in force
at the date of this Agreement, which are deemed to be incorporated
by reference into this section 12A, subject to other provisions of
this section 12A. . . . For the avoidance of doubt, the arbitration
agreement in this section 12A is governed by English law. The
parties intend the arbitration to be expedited.
Second, Section 12(D) contained a fallback provision in case the arbitration
clause was invalidated:
12. Arbitration and Dispute Resolution
....
D. If the provisions for arbitration in this Agreement are
for any reason invalidated or deemed unenforceable the parties
agree to submit to the exclusive jurisdiction and venue of the
federal courts located in Houston, Texas, USA, for any legal suit,
action or proceeding arising out of or based upon this Agreement,
the breach of this Agreement, or any other aspect of the parties’
relationship, including claims against [CrossVerify] or [Fintech]
and/or their or against their affiliates (including DTN and NAC)
and their affiliates, subsidiaries, shareholders, officers, directors,
supervisors, managers, employees, agents, consultants, or
attorneys, in their capacity as such or otherwise may have against
Horne. Further, the parties expressly agree that this forum
selection clause is mandatory and not permissive, and the parties
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agree not to object to adjudication in Houston, Texas on grounds of
forum non-conveniens.
Third, Section 14 contained a choice of law and forum-selection clause:
14. Choice of Law; Jurisdiction and Venue. Except as to claims
against [Fintech], this Agreement and any dispute or claim arising
out of or in connection with it or its subject matter or formulation
(including non-contractual disputes or claims) shall be governed
and construed in accordance with the laws of England and Wales.
Each party irrevocably agrees that the courts of England and
Wales shall have exclusive jurisdiction to settle any dispute or
claim arising out of or in connection with this Agreement or its
subject matter or formation (including non-contractual disputes or
claims), except as to claims against [Fintech].
Based, in part, on those provisions, Horne moved to dismiss the case for
lack of personal jurisdiction, lack of subject matter jurisdiction, and improper
venue. The district court determined that it had personal jurisdiction and
subject matter jurisdiction over Fintech’s claims. 3 The district court also
concluded that the Southern District of Texas was a proper venue. 4 However,
the court sua sponte determined that the case should be dismissed under forum
non conveniens. 5 Fintech appeals the district court’s forum non conveniens
dismissal. Horne cross-appeals, arguing that if forum non conveniens was
inappropriate, this court should still dismiss the case for lack of personal
jurisdiction.
II
We first address whether the district court properly exercised personal
jurisdiction over Horne. “Whether the district court can properly exercise
personal jurisdiction over the defendant is an issue of law we review de novo.” 6
3Fintech Fund, FLP v. Horne, 327 F. Supp. 3d 1007, 1021-23 (S.D. Tex. 2018).
4Id. at 1026.
5 Id. at 1028.
6 Clemens v. McNamee, 615 F.3d 374, 378 (5th Cir. 2010) (citing Felch v. Tranportes
Lar–Mex SA DE CV, 92 F.3d 320, 324 (5th Cir. 1996)).
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“If, as here, the court rules on personal jurisdiction without conducting an
evidentiary hearing, the plaintiff bears the burden of establishing only a prima
facie case of personal jurisdiction.” 7 In evaluating whether the plaintiff has
met that burden, “the court must accept as true all uncontroverted allegations
in the complaint and must resolve any factual disputes in favor of the
plaintiff.” 8
Because the Texas long-arm statute extends as far as constitutional due
process permits, we need only consider if the exercise of jurisdiction comports
with the Due Process Clause. 9 “Where the plaintiff alleges specific jurisdiction,
as here, due process requires (1) minimum contacts by the defendant
purposefully directed at the forum state, (2) a nexus between the defendant’s
contacts and the plaintiff’s claims, and (3) that the exercise of jurisdiction over
the defendant be fair and reasonable.” 10 “Once a plaintiff establishes minimum
contacts between the defendant and the forum state, the burden of proof shifts
to the defendant” to make a “compelling case” 11 that “the assertion of
jurisdiction is unfair and unreasonable.” 12 Horne argues that Fintech did not
meet its burden of showing minimum contacts by Horne purposefully directed
at the forum state, and that even if Fintech met its burden, exercising personal
jurisdiction would not be fair or reasonable.
Fintech alleges that Horne made fraudulent statements in phone calls
and sent emails to Andrade fraudulently indicating that a security audit was
7 Sangha v. Navig8 ShipManagement Priv. Ltd., 882 F.3d 96, 101 (5th Cir. 2018)
(citing Quick Techs., Inc. v. Sage Grp. PLC, 313 F.3d 338, 343 (5th Cir. 2002)).
8 ITL Int’l, Inc. v. Constenla, S.A., 669 F.3d 493, 496 (5th Cir. 2012).
9 McFadin v. Gerber, 587 F.3d 753, 759 (5th Cir. 2009) (citing Moncrief Oil Int’l v. OAO
Gazprom, 481 F.3d 309, 311 n.1 (5th Cir. 2007)).
10 Constenla, 669 F.3d at 498.
11 Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985).
12 Sangha, 882 F.3d at 102 (citing Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208, 215
(5th Cir. 1999)).
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needed when it actually was not. At the time Andrade received the calls and
emails, he was in Sugar Land, Texas. The district court held that those phone
calls and emails constituted sufficient minimum contacts to satisfy due process
concerns. 13 Horne argues that the phone calls and emails are insufficient
contacts because Horne was not aware that Andrade was in Texas when he
made the calls and sent the emails. The district court was not persuaded by
Horne’s argument and held that because “Andrade is [Fintech’s]
representative,” Horne’s contacts were “directed toward [Fintech],” a Texas
company. 14 As the district court pointed out, Horne knew Fintech is a Texas
company. 15 Further, the district court noted that at least one email that Horne
sent to Andrade was sent to “fintechfund@crossverify.global,” further
illustrating that Horne was purposefully contacting Fintech. 16
We agree with the district court’s analysis. That Andrade was in Texas
when Horne called and emailed him may have been fortuitous, “but the
tortious nature of the directed activity constitutes purposeful availment,”
satisfying the minimum contacts requirement. 17 Horne purposefully called
and emailed Andrade. Those are his tortious contacts with the forum. Horne
quotes Revell v. Lidov for the proposition that he “must be chargeable with
knowledge of the forum at which his conduct is directed.” 18 Revell is
distinguishable. Revell involved an allegedly libelous publication that
criticized the plaintiff. 19 The plaintiff sued in Texas, arguing that he suffered
the effects of that publication there. 20 We noted that the only connection the
13 Fintech Fund, FLP v. Horne, 327 F. Supp. 3d 1007, 1019-21 (S.D. Tex. 2018).
14 Id. at 1019-20.
15 Id. at 1020.
16 Id.
17 Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208, 213 (5th Cir. 1999).
18 317 F.3d 467, 475 (5th Cir. 2002).
19 Id. at 469.
20 Id. at 471-73.
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case had with Texas was that the plaintiff resided there, which the defendant
did not know. 21 The publication “contain[ed] no reference to Texas, nor [did] it
refer to the Texas activities of [plaintiff], and it was not directed at Texas
readers.” 22 We held that the defendant did not direct any action at Texas.23
Here, Horne directed his allegedly tortious conduct at Texas, and he directed
it at a Texas entity that he knew was a Texas entity. Those facts are
determinative. Accordingly, Horne had sufficient minimum contacts with
Texas to satisfy the exercise of specific jurisdiction.
Furthermore, we agree with the district court that the exercise of
jurisdiction is fair and reasonable. The court must balance the following
factors when determining whether the exercise of jurisdiction is fair and
reasonable:
(1) the burden on the nonresident defendant of having to defend
itself in the forum, (2) the interests of the forum state in the case,
(3) the plaintiff’s interest in obtaining convenient and effective
relief, (4) the interstate judicial system’s interest in the most
efficient resolution of controversies, and (5) the shared interests of
the states in furthering fundamental social policies. 24
Horne bears the burden of making a “compelling case” that the assertion of
jurisdiction is unfair and unreasonable. 25 “It is rare to say the assertion is
unfair after minimum contacts have been shown.” 26 Most often, “the interests
21 Id. at 475-76.
22 Id. at 473.
23 Id. at 475-76.
24 Sangha v. Navig8 ShipManagement Private Ltd., 882 F.3d 96, 102 (5th Cir. 2018)
(citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985)).
25 Id. (quoting Burger King, 471 U.S. at 477) (citing Wien Air Alaska, Inc. v. Brandt,
195 F.3d 208, 215 (5th Cir. 1999)).
26 Wien Air Alaska, 195 F.3d at 215 (citing Akro Corp. v. Luker, 45 F.3d 1541, 1549
(Fed. Cir. 1995)).
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of the plaintiff and the forum in the exercise of jurisdiction will justify even the
serious burdens placed on the alien defendant.” 27
Horne argues that exercising jurisdiction here is unfair and
unreasonable primarily because he resides in the U.K. and because the parties
agreed to arbitrate their disputes under English law. Horne, however, does
not meet his burden. To be sure, he would have a significant burden defending
a suit in Texas, but, as the district court noted, Fintech would be equally
burdened by litigating in the U.K. 28 The record indicates that Horne has
travelled to Texas to conduct business, which, at least to some degree, indicates
that the burden of traveling to Texas is manageable. Further, Texas has an
interest in the case as the case involves the alleged misappropriation of trade
secrets of a Texas business.
As explained below, Horne is correct that the parties agreed to arbitrate
their dispute, which would likely result in a more efficient resolution of claims.
But that one factor does not render Texas’s exercise of jurisdiction unfair or
unreasonable. Because Horne failed to make a “compelling case,” the district
court did not err in asserting personal jurisdiction.
III
Having determined that the district court properly exercised jurisdiction
over Horne, we must decide whether the case should be dismissed based on
forum non conveniens. In the usual forum non conveniens case, the court
considers various private- and public-interest factors. 29 In conducting that
analysis, a plaintiff’s choice of forum is given “significant but non-
determinative” weight. 30 However, “[t]he existence of a mandatory,
27 In re Chinese Manufactured Drywall Prods. Liab. Litig., 742 F.3d 576, 592 (5th Cir.
2014) (quoting Asahi Metal Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 114 (1987)).
28 Fintech Fund, FLP v. Horne, 327 F. Supp. 3d 1007, 1021 (S.D. Tex. 2018).
29 Weber v. PACT XPP Techs., AG, 811 F.3d 758, 766 (5th Cir. 2016).
30 Id. at 767.
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enforceable [forum-selection clause] dramatically alters this analysis.” 31 First,
we give no weight to the plaintiff’s choice of forum and instead require the
plaintiff to establish dismissal is unwarranted. 32 Second, we do not consider
the private-interest factors because the parties “waive the right to challenge
[the convenience of the] preselected forum.” 33 Accordingly, “the practical result
is that forum-selection clauses should control except in unusual cases.” 34
Importantly, this analysis presupposes that the forum-selection clause is valid
and that the relevant dispute falls within its scope. 35
Here, the district court sua sponte raised forum non conveniens. It then
determined that the Agreement contained a valid forum-selection clause and
that all of the public-interest factors weighed in favor of dismissal. 36 “We
review the district court’s interpretation of the [forum-selection clause] and its
assessment of that clause’s enforceability de novo, then we review for abuse of
discretion the court’s balancing of the . . . public-interest factors.” 37
A
As a preliminary matter, the parties briefly discuss what law should
apply when interpreting the Agreement and determining its validity. The
district court applied Texas law, stating that “[t]he parties do not dispute that
Texas law governs.” 38 But the parties did not, in fact, acquiesce to the
application of Texas law. As such, the district court should have engaged in a
31 Id.
32 Id. (citing Atl. Marine Constr. Co. v. U.S. Dist. Court for W. Dist. of Tex., 571 U.S.
49, 63 (2013)).
33 Id. (quoting Atl. Marine, 571 U.S. at 64).
34 Atl. Marine, 571 U.S. at 64.
35 See id. at 62 n.5 (“Our analysis presupposes a contractually valid forum-selection
clause.”); Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 301 (5th Cir. 2016).
36 Fintech Fund, FLP v. Horne, 327 F. Supp. 3d 1007, 1024-28 (S.D. Tex. 2018).
37 Weber, 811 F.3d at 768.
38 Fintech Fund, 327 F. Supp. 3d at 1025.
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choice-of-law analysis, which in this case dictates that English, not Texas, law
should apply.
Though the district court was not sitting in diversity, we still look to state
law when determining the validity of a contract in federal question cases. 39 A
federal court applying state law generally applies the choice-of-law rules of the
forum state. 40 Here, the forum state is Texas. Texas courts look to the
Restatement (Second) of Conflict of Laws “[i]n deciding which state’s law
should govern the construction of contractual rights.” 41 The Restatement
provides that “[t]he validity of a contract . . . is determined by the law selected
by application of the rules of §§ 187 [(Law of the State Chosen by the Parties)]-
188 [(Law Governing in Absence of Effective Choice by the Parties)].” 42 Here,
the parties chose which law should apply. Thus, we next look to Section 187 of
the Restatement, 43 which provides in relevant part:
(1) The law of the state chosen by the parties to govern their
contractual rights and duties will be applied if the particular issue
is one which the parties could have resolved by an explicit
provision in their agreement directed to that issue.
(2) The law of the state chosen by the parties to govern their
contractual rights and duties will be applied, even if the particular
issue is one which the parties could not have resolved by an explicit
provision in their agreement directed to that issue, unless either
(a) the chosen state has no substantial relationship to the
parties or the transaction and there is no other reasonable
basis for the parties’ choice, or
39 See Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199, 202 (5th Cir. 2016).
40 See Weber, 811 F.3d at 770 (“A federal court sitting in diversity applies the forum
state’s choice-of-law rules to determine which substantive law will apply.” (citing Klaxon Co.
v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496-97 (1941))).
41 Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 304 (5th Cir. 2016) (alterations in
original) (quoting Maxus Expl. Co. v. Moran Bros., Inc., 817 S.W.2d 50, 53 (Tex. 1991)).
42 RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 200 (AM. LAW INST. 1971).
43 See Barnett, 831 F.3d at 304-05 (noting that Texas courts have adopted Section 187
of the Restatement).
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(b) application of the law of the chosen state would be
contrary to a fundamental policy of a state which has a
materially greater interest than the chosen state in the
determination of the particular issue and which, under the
rule of § 188, would be the state of the applicable law in the
absence of an effective choice of law by the parties. 44
If this dispute falls under subsection (1), English law applies according
to the subsection’s terms. If the dispute falls under subsection (2), English law
still applies. England has a substantial relationship to the parties—Horne is
a U.K. citizen and CrossVerify is registered in the U.K. Moreover, Horne
performed services for CrossVerify (and by affiliation, Fintech) in the U.K.
Regarding § 187(2)(b), neither party argues that the application of English law
is contrary to a fundamental policy of Texas. Further, Texas does not have a
“materially greater interest” in the resolution of this suit than England.
Though Fintech is a Texas entity, Horne, a U.K. citizen, is accused of stealing
confidential information while working for CrossVerify, a U.K. entity. Texas
has an equal interest in the resolution of this case as England. Accordingly,
we will apply the general rule of enforcing the choice of law provision and
analyze the Agreement under English law. 45
B
Fintech argues the forum-selection clause is not valid because it
irreconcilably conflicts with another provision in the Agreement—the
arbitration provision in Section 12(A). Because they conflict, Fintech argues
that the court should strike both provisions and apply Section 12(D)’s fallback
provision, which requires the parties to litigate disputes in the federal courts
44RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 187 (AM. LAW INST. 1971).
45 See Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 304 (5th Cir. 2016) (“The
Supreme Court of Texas has recognized that contractual choice of law provisions should
generally be enforced . . . .” (quoting Int’l Interests, L.P. v. Hardy, 448 F.3d 303, 306-07 (5th
Cir. 2006))).
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in Houston. Section 12(A) requires that “all disputes, controversies or claims
arising out of or relating to this Agreement (including for any breach, invalidity
or interpretation of this Agreement)” and “any non-contractual obligations
arising out of or in connection with this Agreement . . . shall be finally
adjudicated by arbitration under the London Court of International
Arbitration.” Section 14 states that “the courts of England and Wales shall
have exclusive jurisdiction to settle any dispute or claim arising out of or in
connection with this Agreement or its subject matter or formation (including
non-contractual disputes or claims).”
Under English law, courts should make every attempt to harmonize
contractual provisions and should determine that two provisions are
irreconcilable only as a “last resort.” 46 English law also provides that forum-
selection clauses do not inherently conflict with arbitration provisions. 47 For
example, in Paul Smith, the court reconciled an arbitration provision and a
“Language and Law” provision. 48 The arbitration provision stated that “any
dispute or difference . . . aris[ing] between the parties . . . shall be
adjudicated . . . by one or more Arbitrators.” 49 The Language and Law
provision stated that the “Courts . . . of England shall have exclusive
jurisdiction over [the Agreement].” 50 The court held that the two clauses were
reconcilable, and that the second referred to the court that could take interim
measures to assist an arbitration (e.g., entering preservation orders or
removing an arbitrator for misconduct). 51 The court noted that there was an
46 See Shell Int’l Petroleum Co. v. Coral Oil Co. [1999] 1 Lloyd’s Rep. 72 (QB) 75-76.
47 See Paul Smith Ltd. v. H&S Int’l Holding Inc. [1991] 2 Lloyd’s Rep. 127 (QB) 129-
30.
48 See id. at 128-30.
49 Id. at 128.
50 Id. at 128-29.
51 Id. at 129-30.
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apparent incongruity between the two clauses. 52 However, that incongruity
“pale[d] into insignificance . . . when compared to the unfortunate
consequences of treating the arbitration clause in a non-domestic commercial
agreement as pro non scripto.” 53
Paul Smith controls here. Paul Smith makes clear that giving a court
“exclusive jurisdiction” does not conflict with an arbitration clause. Like the
provision in Paul Smith, the forum-selection clause here provides English
courts with “exclusive jurisdiction.” Even when a case is submitted to
arbitration, the court retains some supervisory jurisdiction. 54 Accordingly, a
dispute or issue can be “settled” under a court’s jurisdiction even when
submitted to arbitration. Under Paul Smith, the provisions do not conflict.
Moreover, the court’s ultimate task in construing a contract “is to
ascertain the intention of the parties.” 55 We start with the assumption that
“the parties, as rational businessmen, are likely to have intended any dispute
arising out of the relationship into which they have entered . . . be decided by
the same tribunal.” 56 The Agreement itself confirms that assumption. The
parties dedicate six paragraphs in the Agreement to a complex arbitration
scheme. Meanwhile, the forum-selection clause exists in a single paragraph
titled “Choice of Law; Jurisdiction and Venue.” “Business common sense”
indicates the parties intended to submit their claims to arbitration. 57 This case
52 Id. at 130.
53 Id.
54 Id. (“The law governing the arbitration comprises the rules governing interim
measures (e.g. Court orders for the preservation or storage of goods), the rules empowering
the exercise by the Court of supportive measures to assist an arbitration which has run into
difficulties (e.g. filling a vacancy in the composition of the arbitral tribunal if there is no other
mechanism) and the rules providing for the exercise by the Court of its supervisory
jurisdiction over arbitrations (e.g. removing an, arbitrator for misconduct).”).
55 See Shell Int’l Petroleum Co. v. Coral Oil Co. [1999] 1 Lloyd’s Rep. 72 (QB) 75.
56 Premium Nafta Prods. Ltd. v. Fili Shipping Co. [2007] UKHL 40, [13].
57 Taylor v. Rive Droite Music Ltd. [2005] EWCA (Civ) 1300, [2006] EMLR 4 [94].
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is not the type of “rare” case that would require us, as a measure of “last resort,”
to declare these two provisions irreconcilable. 58 The parties agreed that claims
will be submitted to and decided by an arbitration panel. However, because
courts retain jurisdiction to decide interim matters relating to the
arbitration, 59 the parties agreed that only the courts of England may decide
those interim matters. We will hold the parties to that Agreement. Therefore,
we agree with the district court that Section 12(A) and Section 14 can be
harmonized, albeit for different reasons.
C
Fintech argues that even if Section 12(A) and Section 14 can be
harmonized, Fintech’s claims still fall outside of the scope of those provisions.
Section 12(A) covers, among other things, “all disputes arising out of or relating
to this Agreement” and “any non-contractual obligations arising out of or in
connection with this Agreement.” Section 14 covers “any dispute or claim
arising out of or in connection with this Agreement or its subject matter or
formation (including non-contractual disputes or claims).” Under English law,
both arbitration clauses and forum-selection clauses “in . . . international
commercial contract[s] should be liberally construed” and “[t]he words ‘arising
out of’ should cover every dispute except a dispute as to whether there was ever
a contract at all.” 60 Fintech reasons that because it brings claims under federal
law that can stand without relying on the Agreement, the claims fall outside
of Section 12(A)’s and Section 14’s scope.
Fintech’s argument ignores the standard set forth in Fiona Trust. Fiona
Trust makes clear that we should broadly construe when a claim arises out of
58 Shell Int’l Petroleum, [1999] 1 Lloyd’s Rep. at 75-76.
59 See Paul Smith Ltd. v. H&S Int’l Holding Inc. [1991] 2 Lloyd’s Rep. 127 (QB) 129-
30.
60 Martinez v. Bloomberg LP, 740 F.3d 211, 224 (2d Cir. 2014) (second alteration in
original) (quoting Fiona Trust & Holding Corp. v. Privalov [2007] EWCA (Civ) 20 [18]).
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an agreement. 61 Fintech claims that Horne misappropriated trade secrets and
unlawfully used a protected computer to misappropriate confidential
information. Liberally construed, those claims arise out of the Agreement,
which was entered into because the “parties desire to have maintained, not
disclosed, and used only for the benefit of [CrossVerify] (or its affiliates as the
case may be) all such inventions, technology, intellectual property, information
and trade secrets.” Accordingly, Fintech’s claims are within the scope of the
arbitration provision and are subject to a valid forum-selection clause.
Normally, we would also need to decide whether the clause is enforceable
under federal law. 62 However, Fintech does not brief enforceability and thus
does not meet its burden to overcome the presumption of enforceability. 63
D
Because the district court correctly applied the forum-selection clause,
we need only consider whether the district court abused its discretion in
applying the public-interest factors. 64 Those factors include:
administrative difficulties flowing from court congestion; the local
interest in having localized controversies decided at home; the
interest in having the trial of a diversity case in a forum that is at
home with the law that must govern the action; the avoidance of
unnecessary problems in conflict of laws, or in the application of
foreign law; and the unfairness of burdening citizens in an
unrelated forum with jury duty. 65
When dealing with a forum-selection clause, Fintech, as the plaintiff, must
show that dismissal is unwarranted. 66 Fintech fails to make that showing.
61 Fiona Trust, [2007] EWCA (Civ) 20 [18].
62 Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 301 (5th Cir. 2016) (enumerating the
factors the court looks to in determining whether a clause is “‘unreasonable’ under the
circumstances” (quoting Haynsworth v. The Corp., 121 F.3d 956, 963 (5th Cir. 1997))).
63 See id.
64 Weber v. PACT XPP Techs., AG, 811 F.3d 758, 768 (5th Cir. 2016).
65 Id. at 776 (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n.6 (1981)).
66 Atl. Marine Constr. Co. v. U.S. Dist. Court for W. Dist. of Tex., 571 U.S. 49, 63 (2013).
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Fintech argues the public factors weigh against dismissal because
(1) “[t]here is no evidence that the English courts are any less congested than
those in the Southern District of Texas”; (2) “[t]he American judicial
system . . . has a substantial interest in ensuring that Americans can, through
civil actions, enforce . . . criminal laws and vindicate their rights”; and (3) “it
makes little sense to entrust the enforcement of . . . U.S. criminal laws with, or
impose the burden of doing so on, the English judicial system.” Fintech’s first
argument ignores the standard; Fintech bears the burden of proving that
dismissal is unwarranted and offers no evidence that the Texas courts are less
congested than English courts. Regarding its second argument, Fintech is
correct that “the United States [has] an interest in protecting [its] citizens from
abuse by foreign[ers],” but that “manifestly is not the sort of exceptional
circumstance that justifies disregarding the parties’ agreement on public-
interest-factor grounds.” 67 Fintech’s third argument, even if true, does not
meet the “quite . . . high burden of persuasion” 68 to show that this is an
“unusual case[].” 69 Moreover, English law governs the Agreement. The
English judicial system is thus in a much better position to handle a dispute
arising out of the Agreement.
E
Fintech also argues that the district court reversibly erred by dismissing
the case under forum non conveniens without providing Fintech an
opportunity to respond. However, we have upheld a forum non conveniens
dismissal despite a lack of notice to the plaintiff because the plaintiff could not
“demonstrate prejudice from the error.” 70 The same is true here. Fintech’s
67 Weber, 811 F.3d at 776.
68 Id.
69 Id. (quoting Atl. Marine, 571 U.S. at 64).
70 Moreno v. LG Elecs., USA Inc., 800 F.3d 692, 699 (5th Cir. 2015).
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claims were subject to a valid forum-selection clause, and Fintech cannot show
prejudice from its inability to brief the public-interest factors.
* * *
For the foregoing reasons, we AFFIRM the judgment of district court.
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