in Re Oceanografia, S.A. De C v. Otto Candies LLC, Candies Mexican Investments, and Osa International

IN THE SUPREME COURT OF TEXAS
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NO . 14-0963
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IN RE OCEANOGRAFIA, S.A. DE C.V., OTTO CANDIES LLC,
CANDIES MEXICAN INVESTMENTS, AND OSA INTERNATIONAL, RELATORS
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ON PETITION FOR WRIT OF MANDAMUS
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PER CURIAM
The Seba’an, a merchant vessel registered in Mexico and sailing under the Mexican flag with
a Mexican crew, was ferrying workers, all citizens of Mexico, from the Mexican port of Ciudad del
Carmen to an offshore drilling site when it caught fire and sank off the coast of Mexico. One worker
drowned. The others were rescued. All the survivors still live in Mexico except one, who lives in
Illinois. Oceanografia, S.A. de C.V., a Mexican entity, operated the ship and employed its captain
and crew. Oceanografia chartered the ship from its owner, Candies Mexican Investments, S. de R.L.
de C.V. (CMI), a Mexican entity controlled by an affiliate, Otto Candies LLC, a Louisiana entity.
Oceanografia’s marketing affiliate, OSA International, LLC, is a Texas entity, though it was not
created until after the incident.
The deceased worker’s beneficiaries and 91 of the surviving workers sued Oceanografia,
CMI, Otto Candies, and OSA for damages in a district court in Cameron County, Texas. The trial
court refused to dismiss the action for forum non conveniens under Section 71.051 of the Texas Civil
Practice and Remedies Code. The court of appeals denied mandamus relief, concluding that
defendants’ lack of diligence in pursuing relief had prejudiced plaintiffs. ___ S.W.3d ___ (Tex.
App.—Corpus Christi-Edinburg, orig. proceeding) (mem. op.). We grant relief.
Plaintiffs filed suit in July 2008. Oceanografia, CMI, and Otto Candies moved to dismiss
based on forum non conveniens, and Oceanografia filed a special appearance. In March and April
2010, the trial court overruled the special appearance and denied the motion to dismiss. Oceanografia
appealed the former ruling. The court of appeals affirmed in December 2011, Oceanografia, S.A. de
C.V. v. Hernandez, No. 13-10-00223-CV, 2011 WL 6142789 (Tex. App.—Corpus Christi-Edinburg
Dec. 8, 2011, pet. denied) (mem. op.), and we denied Oceanografia’s petition for review in June
2013, 56 Tex. Sup. Ct. J. 613 (June 7, 2013).
Oceanografia’s appeal stayed commencement of a trial, see TEX . CIV . PRAC. & REM . CODE
§ 51.014(b), but the parties engaged in discovery. Seven plaintiffs were deposed and some
documents exchanged. Two attempts at mediation were unsuccessful. Plaintiffs moved the trial court
to conduct separate trials for groups of plaintiffs, beginning with an initial group of eight. In August
2013, defendants moved for summary judgment. In April 2014, defendants jointly moved for
reconsideration of the motions to dismiss, though OSA had not previously filed a motion to dismiss.
The court denied reconsideration but allowed the plaintiffs who had been unable to obtain visas to
enter the United States to withdraw from the first trial group. In June 2014, defendants sought
mandamus relief from the court of appeals.
Whether a party’s delay in asserting its rights precludes mandamus relief depends on the
circumstances. In Rivercenter Associates v. Rivera, we denied review of a trial court’s refusal to
enforce a waiver of jury trial in a commercial lease because of the plaintiff’s unjustified four-month
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delay in moving to quash the defendant’s jury demand. 858 S.W.2d 366, 367 (Tex. 1993). But in In
re International Profit Associates, Inc., we held that neither a party’s four-month delay in obtaining
a hearing on its motion to dismiss based on a contractual forum-selection clause, nor the following
eight-month delay in obtaining a corrected order denying the motion, precluded mandamus review
because the delays were not the party’s fault. 274 S.W.3d 672, 675–76 (Tex. 2009). And in In re E.I.
du Pont de Nemours & Co., a case much like the present one, we held that a defendant’s four-year
delay in moving for dismissal for forum non conveniens under Section 71.052 while challenging in
personam jurisdiction did not preclude mandamus relief, especially when the delay had not
prejudiced the plaintiffs. 92 S.W.3d 517, 524–25 (Tex. 2002) (DuPont). We said:
The plaintiffs argue that by asserting special appearances and conducting limited
discovery DuPont waived any relief under [the forum non conveniens statute]. The
plaintiffs have failed to show how the delay has prejudiced them in any way. Even
if they had made such a showing, the plaintiffs cite nothing to indicate that the
Legislature intended for a defendant to elect between a special appearance and a
motion to dismiss under [the statute]. Absent any such legislative intention, we
cannot conclude that a party must exercise its rights under [the statute] when to do
so would compromise its assertion that the trial court lacked personal jurisdiction
over it.
Id.
Oceanografia, like DuPont, cannot be faulted for the delay in seeking mandamus relief from
the denial of its motion to dismiss for forum non conveniens when to press ahead might have
compromised its appeal of the denial of its special appearance. Nor was CMI’s and Otto Candies’s
decision to await Oceanografia’s jurisdictional appeal unreasonable. Plaintiffs argue that defendants
should have sought mandamus relief immediately after the appeal was over. Defendants counter that
their nine-month delay in moving for reconsideration of the motions to dismiss after the appeal
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ended was not unreasonable because of developing evidence that plaintiffs would have to be tried
in groups and some of the plaintiffs would not even be allowed into the United States. We agree.
OSA’s delay in tagging along on the motion for reconsideration did not contribute to the delay in
obtaining a ruling or in seeking mandamus review.
Moreover, plaintiffs, like those in DuPont, have shown no prejudice from any delay. They
argue that Oceanografia should not be permitted to move for summary judgment and wait for an
unfavorable ruling before pursuing its motion to dismiss for forum non conveniens. But the trial
court never ruled on the motion for summary judgment. Plaintiffs argue that they incurred litigation
expenses after the motions to dismiss were initially denied, but they have not demonstrated why their
litigation efforts to date cannot be fully used in a trial in Mexico. Plaintiffs argue in passing that
defendants’ delay in moving for reconsideration until two months before a trial setting caused them
to incur trial preparation expenses that are now lost. But plaintiffs have provided no detail
whatsoever regarding any such expenses.
In this case, as in DuPont, defendants’ delay in seeking dismissal for forum non conveniens
was not unreasonable. Defendants’ explanations were sufficient to show that they did not “slumber
on their rights.” Rivercenter, 859 S.W.2d at 367. And as in DuPont, defendants’ delay did not
prejudice plaintiffs.
Section 71.051(b) lists six factors to be considered in determining whether a claim should
be dismissed for forum non conveniens:
(1) an alternate forum exists in which the claim or action may be tried;
(2) the alternate forum provides an adequate remedy;
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(3) maintenance of the claim or action in the courts of this state would work
a substantial injustice to the moving party;
(4) the alternate forum, as a result of the submission of the parties or
otherwise, can exercise jurisdiction over all the defendants properly joined to the
plaintiff’s claim;
(5) the balance of the private interests of the parties and the public interest of
the state predominate in favor of the claim or action being brought in an alternate
forum, which shall include consideration of the extent to which an injury or death
resulted from acts or omissions that occurred in this state; and
(6) the stay or dismissal would not result in unreasonable duplication or
proliferation of litigation.
The first, fourth, and sixth factors clearly weigh in favor of dismissal. Plaintiffs may try their claims
in Mexico, where all but one of them reside, and defendants have stipulated to jurisdiction there.
Concerns about having to duplicate, in Mexican courts, the document discovery and depositions
undertaken in the Texas courts may be addressed by agreements between the parties.
The trial court found that, in this instance, the Mexican courts would not provide an adequate
remedy, finding “evidence that certain defendants have attempted to threaten, bribe, and intimidate
Plaintiffs and potential plaintiffs in other litigation.” The evidence apparently consisted of an
affidavit about calls to a plaintiff involved in other litigation. The affidavit does not support the trial
court’s finding. The trial court also referenced safety issues due to violence in Mexico generally.
There is no evidence, however, that a case like this could not be safely tried in Mexican courts in
Ciudad del Carmen, where almost all of the plaintiffs live or work.
The trial court found that maintaining this action in Texas would not work a substantial
injustice. But defendants assert that none of the Mexican witnesses can be compelled to testify in a
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Texas court. These include Oceanografia’s crew aboard the Seba’an, technicians who repaired the
ship, government inspectors who examined the repairs, passengers who did not bring suit, crews on
the rescue vessels, doctors who examined plaintiffs when they returned to port, and family members
and co-workers who could testify about the accident’s after-effects on plaintiffs. Even if witnesses
are willing and available to testify by deposition, defendants assert that they would still be
substantially prejudiced in the presentation of their case.
An alternative forum is adequate if the defendant would be subject to the alternate forum’s
jurisdiction by consent or otherwise, and the substantive law in the alternate forum would not
deprive the parties of a remedy. In re Pirelli Tire, LLC, 247 S.W.3d 670, 677–78 (Tex. 2007); see
also In re Bridgestone Americas Tire Operations, LLC, 459 S.W.3d 565, 575–76 (Tex. 2015). In
Pirelli, we held that the defendant had demonstrated the availability of an adequate forum by
stipulating that it would submit to personal jurisdiction in Mexico and would not assert a
statute-of-limitations defense. 247 S.W.3d at 677–78. Lesser remedies will not make a forum
inadequate; a forum is inadequate if the remedies it offers are so unsatisfactory they really comprise
no remedy at all. In re Ensco Offshore Int’l Co., 311 S.W.3d 921, 924–25 (Tex. 2010).
Courts routinely reject arguments based generally on the corruption of a forum, especially
when evidence of corruption, and the defendant’s participation therein, is anecdotal and speculative.
See, e.g., Vinmar Trade Fin., Ltd. v. Util. Trailers de Mex., S.A. de C.V., 336 S.W.3d 664, 675 (Tex.
App.—Houston [1st Dist.] 2010, no pet.) (collecting cases).
Whether Otto Candies and OSA International would be subject to liability in Mexico on alter
ego or other theories is immaterial. A forum will not be inadequate simply because its laws are less
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favorable to plaintiffs. Pirelli, 247 S.W.3d at 677–78. It is also not determinative that Oceanografia
and Otto Candies do business and have litigated in Texas. Here, the repairs, accident, and rescue
occurred in Mexican waters, aboard a ship controlled and operated by a Mexican company, and
crewed by its Mexican employees. There is no dispute that the crew, repair technicians, inspectors,
and rescue workers are all residents of Mexico, as are all but one of the plaintiffs. Plaintiffs argue
that there is no ship or accident scene to inspect, only photos and records that may be viewed
anywhere. There must still be witnesses, however, to explain the events that took place and the
content of those records. Further, even if Otto Candies holds many of the relevant records at its
headquarters in the United States, that headquarters is not in Texas. The trial court found that the key
non-party witnesses are likely to be American companies that investigated the accident, naming two
companies who would be beyond the subpoena power of a Mexican court. But these are at most two
sets of witnesses, to counter the overwhelming number of Mexican connections. We therefore
conclude that the trial court also abused its discretion in finding that the balance of the private
interests of the parties and the public interest predominate in favor of maintaining this action in
Texas.
The factors in Section 71.051(b) clearly predominate in favor of dismissal. The claims in this
case are tied to Mexico and have almost no connection to Texas. Without hearing oral argument, see
TEX . R. APP . P. 52.8(c), we conditionally grant mandamus relief and direct the trial court to vacate
its order denying defendants’ motion for reconsideration and to issue an order dismissing the case
for forum non conveniens. The writ will issue only if the trial court fails to promptly comply with
this opinion. We leave to the trial court any questions about defendants’ stipulations to trying the
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case on the merits in Mexico or about any agreements or orders to avoid prejudice to the parties and
waste or duplication of effort and to facilitate the transfer of the litigation to Mexico.
Opinion delivered: July 1, 2016
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