in Re Linda P. Meyer and Polymer Trading USA, LLC ( 2014 )

Petition for Writ of Mandamus Conditionally Granted and Memorandum
Opinion filed October 24, 2014.
In The
Fourteenth Court of Appeals
NO. 14-14-00833-CV
IN RE LINDA P. MEYER AND POLYMER TRADING USA, LLC, Relators
ORIGINAL PROCEEDING
WRIT OF MANDAMUS
133rd District Court
Harris County, Texas
Trial Court Cause No. 2014-59925
MEMORANDUM OPINION
On October 20, 2014, relators Linda P. Meyer and Polymer Trading USA,
LLC filed a petition for writ of mandamus in this court. See Tex. Gov’t Code Ann.
§ 22.221; see also Tex. R. App. P. 52. In the petition, relators ask this court to
compel the Honorable Mike Miller, ancillary judge of Harris County, to set aside
the temporary restraining order he signed on October 15, 2014, on the application
of real party in interest Gulfstream Trading, Ltd. We conditionally grant the
petition. 1
I. BACKGROUND
On October 14, 2014, Gulfstream filed an original petition, application for
temporary restraining order, application for temporary injunction, and motion for
expedited discovery against relators in the trial court. According to Gulfstream’s
petition, 2 Gulfstream is engaged in the trading of petroleum feedstocks and
petrochemical byproducts. On May 1, 2013, Gulfstream hired Meyer as a full-time
employee to engage in the trading of polymers on Gulfstream’s behalf, a business
Gulfstream had not conducted before hiring Meyers. Under an oral employment
agreement, a Gulfstream affiliate was to provide a specified maximum amount of
debt financing for its polymer trading activities directly to an entity called Polymer
Trading USA (“Polymer Trading”), of which Meyer is sole owner. Meyer
represented that she would need $3 to $6 million in funding to carry out the trading
activities, and the profit margin would be five to seven percent. Meyer would
receive twenty percent of the adjusted gross profit of the polymer trading activities,
a monthly salary that would constitute a draw on the twenty percent figure, and
health insurance.
Gulfstream alleges that payments from customers of its polymer trading
activities were deposited in a Chase Bank account or sent directly to Polymer
Trading. Gulfstream ultimately acquiesced to this arrangement only until bank
1
This court requested a response to the petition from Gulfsteam, but none was filed. See
Tex. R. App. P. 52.4.
2
The facts stated herein are from Gulfstream’s petition.
2
financing could be secured and Gulfstream opened its own bank account for these
activities. Meyer granted Gulfstream’s Chief Financial Officer (“CFO”) access to
Polymer Trading’s bank account for monitoring. When Gulfstream’s management
asked Meyer to propose a revised employment arrangement, Meyer stated she
intended to quit. On April 14, 2014, Meyer emailed Gulfstream’s CFO that she
was not coming back to the office. Meyer then terminated the CFO’s ability to
access Polymer Trading’s bank account.
Meyer was advised to commence working on an “unwind plan,” and on
April 16, 2014, Meyer proposed a new employment agreement to Gulfstream to
continue their business relationship. Gulfstream accepted Meyer’s proposal on
April 30, 2014, on the condition that all funds associated with the polymer trading
activities flow through Gulfstream’s accounts. A few days later, problems began
to surface with trading contracts Meyer had executed, exposing Gulfstream to
potential liability. On May 12, 2014, Meyer notified Gulfstream that she was
unhappy with her compensation and claimed that they never had an agreement
regarding compensation. Meyer further advised that, although she was receiving
payments from customers, she did not feel comfortable with transferring the
payments until all issues were resolved. Gulfstream terminated Meyer’s
employment and offered her severance and health insurance in exchange for
Meyer’s winding down the polymer trading activities. Meyer refused to sign the
termination agreement, but Gulfstream, nonetheless, paid Meyers’ severance
through July 31, 2014, and paid for her health insurance through August 31, 2014.
Gulfstream alleges that Meyer has refused to transfer to it the $252,122.88
that she collected in connection with the polymer trading activities, and that Meyer
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has transferred at least $41,566.11 to her personal checking account. Gulfstream
sued relators asserting claims for breach of fiduciary duty, misappropriation of
fiduciary assets, conversion, civil theft, and money had and received. The trial
court conducted a hearing on October 15, 2014, at which no testimony or evidence
was adduced, and signed the temporary restraining order, setting the temporary
injunction hearing for November 3, 2014. As stated in the temporary restraining
order, the trial court found:
1. The facts stated in Gulfstream’s verified Application show that
without injunctive relief Gulfstream will suffer damage
constituting immediate and irreparable harm. Without
immediate injunctive relief it is likely that Defendants will
transfer money belonging to Gulfstream to Defendants’ own
personal checking account, modify, destroy, hide, or erase
documents, financial records, or electronic information
necessary to uncover and prove Defendants’ unlawful acts
against Gulfstream.
2. Gulfstream has no adequate remedy at law because, once any
relevant information is modified, destroyed, hidden, or erased,
it may be impossible to remedy or determine the impact of such
actions. Moreover, if the money belonging to Gulfstream that
is currently in Defendants’ possession is spent, depleted, or
otherwise transferred out of Defendants’ bank accounts, it may
impact Gulfstream’s ability to recover.
In the temporary restraining order, the trial court enjoined relators from:
• deleting any and all emails pertaining to Gulfstream or any
transaction related to [Meyer’s] work on behalf of Gulfstream
in any email account used by any defendant, or representative
of any defendant, until an order is issued by the court at the
hearing on Plaintiff’s Application for Temporary Injunction;
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• transferring any funds from PTUSA’s Chase account; and
• transferring any funds that are attributable to Gulfstream trades
from any financial account under [Meyer’s] possession,
custody, or control, up to $252.115.18.
In the temporary restraining order the trial court set the temporary injunction
hearing for November 3, 2014, at 3:00, and set bond at $5,000.3
In their mandamus petition, relators complain that the temporary restraining
order: 1) exceeds the 14-day time period allowed; and 2) fails to describe in
reasonable detail the acts restrained.
II. STANDARD OF REVIEW
Generally, to be entitled to mandamus relief, a relator must demonstrate (1)
the trial court clearly abused its discretion; and (2) the relator has no adequate
remedy by appeal. In re Reece, 341 S.W.3d 360, 364 (Tex. 2011) (orig.
proceeding). A trial court clearly abuses its discretion if it reaches a decision so
arbitrary and unreasonable as to amount to a clear and prejudicial error of law, or if
it clearly fails to analyze the law correctly or apply the law correctly to the facts.
In re Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex. 2005) (orig.
proceeding) (per curiam). When an order is void, the relator need not show that it
lacks an adequate remedy by appeal. In re Sw. Bell Tel. Co., 35 S.W.3d 602, 605
(Tex. 2000) (orig. proceeding) (per curiam).
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In the temporary restraining order the trial court further directs relators, by 5:00 p.m.,
on October 20th, to give Gulfstream access to review and copy financial records relating to
deposits and withdrawals of Gulfstream funds to or from Polymer Trading’s Chase account from
April 1, 2014, to October 15, 2014, and such access would only be given in the presence of
Meyer, Meyer’s counsel, and an attorney for Gulfstream. It is not known from the record
whether the review of the financial records took place.
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III. ANALYSIS
In their first issue, relators point out that the TRO does not state when it
expires. In their second issue, relators contend that the temporary restraining order
is void because it lacks the necessary specificity. We agree. Pursuant to Rule 683,
a temporary order must (1) set forth the reasons for its issuance; (2) be specific in
terms; (3) describe in reasonable detail and not by reference to the complaint or
other document, the act or acts sought to be restrained. Tex. R. Civ. P. 683. A
temporary restraining order “must be as definite, clear and precise as possible and
when practicable it should inform the defendant of the acts he is restrained from
doing, without calling on him for inferences or conclusions about which persons
might well differ and without leaving anything for further hearing.” Villalobos v.
Holguin, 208 S.W.2d 871, 875 (Tex. 1948). However, the order need not be “full
of superfluous terms and specifications adequate to counter any flight of fancy a
contemnor may imagine in order to declare it vague.” Ex parte McManus, 589
S.W.2d 790, 793 (Tex. App.—Dallas 1979, orig. proceeding).
The temporary restraining order in this case does not identify (1) Polymer
Trading’s Chase Bank account by account number; (2) the funds attributable to
Gulfstream trades; (3) or the financial accounts under Meyer’s possession, custody,
or control by bank name and account number or any other specific means of
identification. Relators are left to draw inferences and conclusions regarding the
specific funds and specific location of those funds about which persons might
differ. See In re Krueger, No. 03-12-00838-CV, 2013 WL 2157765, at *7 (Tex.
App.—Austin May 16, 2013, orig. proceeding) (mem. op.) (holding that temporary
injunction was void because it violated Rule 683’s specificity requirements—it did
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not describe bank accounts in reasonable detail with names of banks, account
numbers, or current status of the accounts). Moreover, the order does not specify
when it expires. We hold that the temporary restraining order is void for lack of
specificity and sustain relators’ second issue.
IV. CONCLUSION
Having sustained relators’ second issue and determined that the October 15,
2014 temporary restraining order is void, we conclude that the trial court abused its
discretion by signing the order.4 See Sw. Bell. Tel. Co., 35 S.W.3d at 605 (stating
that signing a void order is an abuse of discretion). Therefore, we conditionally
grant the petition for writ of mandamus and order the trial court to vacate the
October 15, 2014 temporary restraining order. The writ will only issue if the trial
court does not act in accordance with this opinion.
PER CURIAM
Panel Consists of Chief Justice Frost and Justices Christopher and Busby.
4
Relators also assert in a third issue that the temporary restraining order is overbroad and
restrains lawful activity because it denies Meyer access to any funds in her personal account for
living expenses. In light of our disposition of relators’ first and second issues, we need not
address this issue.
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