Opinion
NO. 01-17-00652-CV
05-17-2018
IN RE XTO ENERGY, INC., Relator
Original Proceeding on Petition for Writ of Mandamus
MEMORANDUM OPINION
Relator XTO Energy, Inc. has filed a petition for a writ of mandamus challenging the trial court's denial of its motion to dismiss the underlying lawsuit based on forum non conveniens. In two issues, XTO argues that the trial court abused its discretion in denying its motion because Texas is an inconvenient forum for the lawsuit and they are entitled to mandamus relief because they do not have an adequate remedy by appeal. We conditionally grant the petition.
The underlying case is Daniel Pavon and Ana Pavon, Individually and as Next Friend of D#### R. Pavon, a Minor, filed suit against XTO Energy, Inc., Weatherford International, LLC, KLX Energy Services, LLC, and KLX Energy Holdings, LLC, cause number 2016-61844-7, pending in the 164th District Court of Harris County, Texas, the Honorable Alexandra Smoots-Thomas presiding.
Background
Daniel Pavon, Justin Pyle, Richard Chadwick Maheu, and Joseph C. Guillen were injured and John Stassinos died of the injuries he allegedly sustained as a result of a flash fire that occurred at the Ryan 14X-09E well pad in North Dakota (the Well) on June 18, 2016 (the Incident).
The Pavons filed the initial suit and the Pyles later intervened as plaintiffs.
Pavon and Ana Pavon, Individually and as Next Friend of D#### R. Pavon, a Minor and Pyle and Brenda Pyle, Individually and as Next Friend of M#####, a Minor, (the Real Parties in Interest or RPIs) sued XTO Energy, Inc. (XTO), Weatherford International, LLC (Weatherford), KLX Energy Services, LLC, and KLX Energy Holdings, LLC (collectively KLX) in Harris County District Court for damages they allegedly sustained as a result of the Incident. The RPIs alleged negligence claims against XTO, which owns and operates the Well, and Weatherford and KLX, which provided equipment for the Well. XTO, Weatherford, and KLX have their principal places of business in Texas.
The RPIs alleged that during a snubbing operation at the Well on June 18, 2016, "a hole in the final joint of tubing and leaks in the float valves caused a high pressure natural gas release, which resulted in an explosion and flash fire, and launched the final joint and bottom hole assembly . . . out of the wellbore and into the air, likely igniting the gas." According to the RPIs, the incident occurred because XTO decided against "killing" the Well before ordering "snubbing" operations to commence. The RPIs alleged that venue was appropriate in Harris County because "it is a county where a substantial portion of the events and/or omissions giving rise to the subject claims occurred, including critical operational and safety decisions that contributed to and/or caused the accident made the basis of this lawsuit."
"Snubbing" is the act of sending equipment, like a drill pipe, into a well while the well is under pressure. "Killing the well" is an operation to stop the well from producing hydrocarbons. One method often used to kill a well is to place a column of heavy fluids into the well in sufficient quantity such that the downward pressure of the heavy fluids prevents any upward flow from the well.
At the time of the incident, Pavon and Guillen were employed by Sherwood Enterprises (SEI), and Pyle, Maheu, and Stassinos were employed by Most Wanted Well Service (Most Wanted). Pavon and Pyle are Colorado residents. Maheu and Guillen are Wyoming residents and SEI and Most Wanted are Wyoming businesses that were doing business in North Dakota.
The local North Dakota sheriff's department and the fire marshal division of the North Dakota Attorney General's Office investigated the incident and prepared reports. Both reports reference an investigation conducted by the North Dakota office of the Occupational Safety & Health Administration of the U.S. Department of Labor (OSHA). As a result of its investigation in North Dakota, OSHA issued citations to Pavon's and Pyle's employers, SEI and Most Wanted.
The unredacted version of the Sheriff's Department's report identified 33 persons on the Well's site log, none of whom reside in Texas. The RPIs also identified 20 persons or entities with alleged knowledge of the accident. Eight of those persons are located in North Dakota, while seven other persons or entities are located in Wyoming, Utah, or Colorado.
The RPIs case was originally set for trial on August 28, 2017.
During depositions taken in April and May 2017, XTO uncovered evidence directly relevant to the RPIs' allegations that a substantial portion of the events and/or omissions in this case occurred in Texas. Specifically, RPI Pyle testified during his deposition that he and other persons working at the Well site told a consultant named Tom Jones that it was too dangerous to snub and the well should be killed. According to Pyle, Jones directed the crews to snub the well instead of killing it. This alleged directive occurred at the Well during a safety meeting on the date of the accident. Jones, a Montana resident, was employed by Badlands Consulting LLC (Badlands) of Glendive, Montana.
On May 9, 2017, Nick Brown, an employee of Colter Energy who was at the Well when the incident occurred, testified that he had no knowledge that anyone ever told XTO engineers or completions foremen that they thought the well should be killed. Daniel Dickout, another employee of Colter Energy who was at the Well when the incident occurred, also testified on May 9, 2017 that he did not witness any discussions between XTO and Jones. Brown and Dickout are Canadian residents and Colter Energy has a field office in North Dakota.
On May 12, 2017, XTO filed a Motion to Stay or Dismiss for Forum Non Conveniens. It is undisputed that XTO's motion, which was filed three days before the statutory deadline, was timely. See TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(d) (West Supp. 2017). Weatherford and KLX joined this motion.
On July 7, 2017, the trial court heard XTO's motion. The parties presented argument through their counsel but did not introduce any evidence. At the hearing's conclusion, the trial court took XTO's motion under advisement.
On June 8, 2017 and July 11, 2017, XTO supplemented its motion, informing the trial court that two subsequent lawsuits arising from the same oilfield incident were filed in North Dakota federal court. Specifically, on May 22, 2017, Maheu and Guillen filed a personal injury lawsuit in North Dakota federal court against XTO, Weatherford, KLX, Jones, Badlands, Allan Kolden, and Petroleum Experience, Inc. Maheu and Guillen alleged that XTO, Badlands, Jones, Petroleum Experience and Kolden ordered the crews of Most Wanted and SEI to conduct snubbing operations at the North Dakota well instead of killing the well. Approximately a month and a half later, Mary Stassinos and Ryann Stassinos filed a wrongful death lawsuit in North Dakota federal court against the same seven defendants, including XTO, Weatherford, and KLX. The Stassinos plaintiffs alleged, among other things, that XTO decided to snub the well, rather than kill it. Both federal lawsuits allege that a substantial part of the events giving rise to their claims in that case occurred in North Dakota. Pavon's and Pyle's employers, SEI and Most Wanted, are not named defendants in either lawsuit.
The trial court denied XTO's motion by written order dated August 4, 2017. On August 15, 2017, the trial court reset the case for the two-week period beginning March 26, 2018.
After XTO filed its petition for writ of mandamus, the Maheu-Guillen lawsuit and the Stassinos lawsuit were consolidated for discovery and pretrial proceedings.
Mandamus Standard of Review
Mandamus is appropriate to remedy an improper denial of a motion to dismiss for forum non conveniens. See In re Pirelli Tire, L.L.C., 247 S.W.3d 670, 679 (Tex. 2007). We review a trial court's ruling on a motion to dismiss for an abuse of discretion. See In re ENSCO Offshore Int'l Co., 311 S.W.3d 921, 923 (Tex. 2010); In re Gen. Elec. Co., 271 S.W.3d 681, 685 (Tex. 2008). A trial court commits a clear abuse of discretion when its action is "so arbitrary and unreasonable as to amount to a clear and prejudicial error of law." In re CSX Corp., 124 S.W.3d 149, 151 (Tex. 2003). A trial court has no discretion in determining what the law is or in applying the law to particular facts. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135 (Tex. 2004).
Motion to Dismiss for Forum Non Conveniens
Texas Civil Practice and Remedies Code section 71.051 governs motions to dismiss for forum non conveniens in all actions for personal injury or wrongful death. See In re Pirelli Tire, 247 S.W.3d at 674; In re Mantle Oil & Gas, LLC, 426 S.W.3d 182, 187 (Tex. App.—Houston [1st Dist.] 2012, no pet.).
Section 71.051(b) provides:
If a court of this state, on written motion of a party, finds that in the interest of justice and for the convenience of the parties a claim or action to which this section applies would be more properly heard in a forum outside this state, the court shall decline to exercise jurisdiction under the doctrine of forum non conveniens and shall stay or dismiss the claim or action. In determining whether to grant a motion to stay or dismiss an action under the doctrine of forum non conveniens, the court shall consider whether:
(1) an alternate forum exists in which the claim or action may be tried;
(2) the alternate forum provides an adequate remedy;
(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 claims;
(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
TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b) (West Supp. 2017); see also In re Mantle Oil & Gas, 426 S.W.3d at 187-88. If these statutory factors weigh in favor of the claim or action being more properly heard in a forum outside Texas, then dismissal is required. See In re ENSCO, 311 S.W.3d at 924; In re Mantle Oil & Gas, 426 S.W.3d at 188.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.
Section 71.051 does not require that the movant prove every statutory factor or that every factor must weigh in favor of dismissal for the movant to be entitled to relief. See In re Gen. Elec., 271 S.W.3d at 687; see also In re Mantle Oil & Gas, 426 S.W.3d at 188. The statute also does not contain any language placing the burden of proof on a particular party; instead, section 71.051 "simply requires the trial court to consider the factors, and it must do so to the extent the factors apply." In re Gen. Elec., 271 S.W.3d at 687; see also In re Mantle Oil & Gas, 426 S.W.3d at 188.
The doctrine of forum non conveniens has always afforded great deference to the plaintiff's choice of forum. In re Pirelli Tire, 247 S.W.3d at 675; In re Mantle Oil & Gas, 426 S.W.3d at 188. However, the doctrine "generally affords substantially less deference to a nonresident's forum choice." In re Pirelli Tire, 247 S.W.3d at 675; In re Mantle Oil & Gas, 426 S.W.3d at 188; see also Quixtar Inc. v. Signature Mgmt. Team, LLC, 315 S.W.3d 28, 31 (Tex. 2010) (per curiam) (holding same in common-law forum non conveniens context and noting fact "that a plaintiff is not a Texas resident speaks directly to a defendant's burden" in establishing propriety of dismissal). The forum non conveniens doctrine recognizes "that the plaintiff's choice must sometimes yield in the public interest, and in the interest of fundamental fairness." In re Pirelli Tire, 247 S.W.3d at 675. Dismissal on forum non conveniens grounds is appropriate when sufficient contacts between the defendant and the forum state exist to confer personal jurisdiction, but the case itself has no significant connection to the forum state. Id. at 675-76; In re Mantle Oil & Gas, 426 S.W.3d at 188-89. "'It is fundamentally unfair to burden the people of Texas with the cost of providing courts to hear cases that have no significant connection with the State.'" In re Pirelli Tire, 247 S.W.3d at 681 (quoting In re Smith Barney, Inc., 975 S.W.2d 593, 598 (Tex. 1998)).
A. Undisputed Relevant Facts
It is undisputed that the underlying incident in this case involved a flash fire that occurred at a fracking well site located in North Dakota. The RPIs are Colorado residents. XTO's corporate headquarters are in Fort Worth, although it recently announced its plans to move its headquarters to Houston. The other defendants, Weatherford and KLX, have their corporate headquarters in Houston.
Although Pyle initially alleged that he resided in Texas, he conceded during his deposition that he has never lived in Texas.
RPIs Pyle and Pavon were working in North Dakota at the Well when the incident occurred.
The RPIs alleged in their pleadings that the incident occurred because the Well was not "killed" prior to "snubbing" operations being conducted. Evidence adduced during discovery demonstrates that the decision to snub the well instead of killing it was made in North Dakota, not Texas. The physical injuries or medical conditions the RPIs allegedly suffered from the accident occurred in North Dakota, and the medical treatment the RPIs have received was provided in North Dakota, Colorado, Minnesota and Utah—not Texas.
The RPIs have not contradicted these factual allegations, and therefore, we will accept these facts as true. See TEX. R. APP. P. 38.1(g) ("In a civil case, the court will accept as true the facts stated unless another party contradicts them.").
The governmental officials who investigated the accident are based in North Dakota, e.g., the local sheriff's department, the fire marshal division of the North Dakota Attorney General's Office, and OSHA's North Dakota office.
The equipment that the RPIs allege caused the underlying incident—the tubing (the string of drill pipe), the snubbing unit, and the bottom hole float valves—was transported from North Dakota to Texas for testing. This equipment was inspected and tested by T.H. Hill & Associates, a Houston-based business.
None of the material fact witnesses reside in Texas. The majority of the fact witnesses reside in North Dakota or nearby states, such as Wyoming and Colorado—not Texas.
Furthermore, litigation arising out of this incident is already pending in North Dakota federal court, and XTO, Weatherford, and KLX are all defendants in both of those federal lawsuits.
B. Adequate Alternate Forum
The first two factors under section 71.051 are whether (1) an alternate forum exists where the claim may be tried and (2) the alternate forum provides an adequate remedy. TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b)(1)-(2). An alternate forum is one in which the defendants are amenable to process. See In re ENSCO, 311 S.W.3d at 924; In re Gen. Elec., 271 S.W.3d at 688. An alternate forum is inadequate if the remedies that it offers are so unsatisfactory that they really comprise no remedy at all. In re ENSCO, 311 S.W.3d at 924; see also Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255 n.22, 102 S. Ct. 252, 265 n.22 (1981) ("In rare circumstances, however, where the remedy offered by the other forum is clearly unsatisfactory, the other forum may not be an adequate alternative.").
The RPIs do not dispute that XTO is amenable to process in North Dakota, and that, therefore, North Dakota is an available alternate forum. The RPIs, however, argue that North Dakota is an inadequate forum because it deprives the children of a remedy for their loss of parental consortium claims. Compare Butz v. World Wide, Inc., 492 N.W.2d 88, 92 (N.D. 1992) (stating North Dakota does not provide cause of action for loss of parental consortium in personal injury cases that do not involve wrongful death) with Reagan v. Vaughn, 804 S.W.2d 463, 467 (Tex. 1990) (recognizing cause of action under Texas law for loss of parental consortium in personal injury cases that do not involve wrongful death).
The RPIs rely upon Mecum v. Host Marriott Corp., No. 4:04CV260, 2005 WL 997320, at *3 (E.D. Tex. Apr. 25, 2005) in support of their argument that the inability to bring a claim for loss of parental consortium renders North Dakota is an inadequate forum. In that case, a Texas family filed suit in a federal court in Texas against various defendants for damages the family allegedly sustained when the father was injured at a hotel in Calgary, Alberta, Canada. Id. at *1. The district court denied the non-resident defendants' motion to dismiss for forum non conveniens after the court determined that Alberta was not an adequate forum because Alberta did not recognize the Mecum children's claims for damages based on loss of parental consortium. Id. at *3.
XTO, which acknowledges this conflict between Texas and North Dakota law, argues that we should not follow Mecum because that district court order is contrary to the Fifth Circuit Court of Appeals' opinion in Adams v. Merck & Company Inc., 353 Fed. App'x 960, 963 (5th Cir. 2009). In Adams, the Fifth Circuit Court of Appeals held that the United Kingdom was an adequate forum for plaintiffs residing in the U.K. even though English law did not recognize a spouse's loss of consortium claim. Id. The court reasoned that "English law . . . allows for damages for losses incurred caring for an injured spouse, which means that those [plaintiffs] who are spouses of allegedly injured parties would not be left without any remedy in the forum," and that furthermore, a "loss of consortium is a derivative cause of action that does not, standing alone, generally support maintaining jurisdiction in an inconvenient forum." Id.; see e.g., Emslie v. Recreative Indus., Inc., 105 A.D.3d 1335, 1337 (N.Y. App. Div. 2013) (holding forum adequate because "although plaintiff wife could not pursue a cause of action for loss of consortium in Scotland or England, plaintiff husband would be permitted to recover compensation for the services she provided for him in tending to his injuries").
Although neither Adams nor Mecum is binding legal authority with respect to this court, we consider Adams's reasoning to be more persuasive. See 5TH CIR. R. 47.5.4; Gastar Expl. Ltd. v. U.S. Specialty Ins. Co., 412 S.W.3d 577, 587-88 (Tex. App.—Houston [14th Dist.] 2013, pet. denied). A North Dakota forum does not deprive the RPIs of all remedies because they can recover the full panoply of damages available in North Dakota. Also, like in Adams, a loss of parental consortium claim is derivative in nature of the injured parent's claim, and it cannot "standing alone, generally support maintaining jurisdiction in an inconvenient forum." Adams, 353 Fed. App'x at 963; see generally Maes v. El Paso Orthopaedic Surgery Grp., 385 S.W.3d 694, 700 (Tex. App.—El Paso 2012, pet. denied) (stating loss of parental consortium claim is derivative in nature of injured parent's claim and, as such, child cannot recover damages if defendant is found not liable for parent's underlying claim).
The RPIs' reliance on Mecum is further weakened because the RPIs are not Texas residents. See, e.g., Cornett v. Johnson & Johnson, 998 A.2d 543, 553 (N.J. Super. Ct. App. Div. 2010) (recognizing that state "has little interest in protecting the compensation rights of a [non-]resident"). The RPIs are Colorado residents who filed suit in Texas state court for claims arising out of an incident in North Dakota. Notably, the RPIs would not be able to recover damages for loss of parental consortium under Colorado law because, like North Dakota, Colorado does not recognize a right to recover for loss of parental consortium in personal injury cases. See Lee v. Colorado Dep't of Health, 718 P.2d 221, 234 (Colo. 1986) (en banc). While the Mecums would have been unable to recover damages available in their home state of Texas, the RPIs are not losing any such benefit since the law of Colorado is the same as North Dakota in this area.
In support of their argument that North Dakota is an inadequate forum, the RPIs also argue that XTO had no expectation that North Dakota law would apply in this case because the Master Service Agreement between XTO and Most Wanted and the Master Service Agreement between XTO and SEI contain choice-of-law clauses that select Texas law. However, this is a personal injury case arising out of an incident that occurred at a well owned and operated by XTO in North Dakota, not a suit for breach of either service agreement.
Furthermore, it is doubtful that litigating in a North Dakota court, rather than a Texas court, would change the law applied to the RPIs' loss-of-parental-consortium claims. As discussed below, North Dakota appears to have the most significant relationship to this case and the most significant contacts and, therefore, North Dakota law most likely would apply regardless of whether the case is litigated in Texas or North Dakota.
North Dakota applies a "significant contacts" test for deciding choice-of-law questions. This test requires a two-pronged analysis. Daley v. Am. States Preferred Ins. Co., 587 N.W.2d 159, 161 (N.D. 1998). First, the court should identify the relevant contacts which might logically influence the decision on the applicable law, and then apply the choice-influencing considerations "to determine which jurisdiction has the more significant interest with the issues in the case." Id. at 162. The choice-influencing considerations are: (1) the predictability of results; (2) maintenance of interstate and international order; (3) simplification of the judicial task; (4) advancement of the forum's governmental interests; and (5) application of the better rule of law. Id.
C. Substantial Injustice
The third factor is whether maintenance of the claim or action in a Texas court would work a substantial injustice to the moving party. When examining this factor, courts consider, among other things, the location of relevant documents and evidence and whether a majority of witnesses may be reached by compulsory process in Texas, which are also considerations under the fifth factor—the balance of private interest factors. In re Mantle Oil & Gas, 426 S.W.3d at 192; see also In re ENSCO, 311 S.W.3d at 925.
XTO argues that maintenance of the Texas lawsuit would work a substantial injustice upon it because most of its key witnesses, including the Maheu and Stassinos plaintiffs, are not subject to compulsory process in Texas and ninety percent of the witnesses identified on the chart prepared by the RPIs are not subject to compulsory process in Texas. When the great majority of witnesses are not subject to compulsory process in Texas, litigating a case in Texas can result in a substantial injustice to the defendant. In re Mantle Oil & Gas, 426 S.W.3d at 192; see also In re BPZ Res., Inc., 359 S.W.3d 866, 875 (Tex. App.—Houston [14th Dist.] 2012, orig. proceeding) (noting "the lack of compulsory process in Texas for reaching the great majority of witnesses would be substantially unjust"). The RPIs do not dispute that most of the witnesses in this case are not subject to compulsory process in Texas. Rather, the RPIs argue that XTO has not specifically identified the individual witnesses or evidence that it is unable to obtain through the court's subpoena power. XTO, however, is not required to specifically identify the individual witnesses or evidence that it is unable to obtain through the Texas court's subpoena power. See In re Gen. Elec., 271 S.W.3d at 689-90 (stating Texas statute does not place burden of proof on particular party and defendants are not required to identify "any specific witness or evidence they are unable to obtain"). XTO's obligation is to "provide enough information" to enable the trial court "to balance the parties' interests." Piper, 454 U.S. at 258, 102 S. Ct. at 267. In this case, XTO referenced over four dozen potential witnesses in its forum non conveniens motion that it contended are beyond the Texas court's subpoena power and it attached exhibits to its motion identifying these witnesses for the trial court. XTO's mandamus petition also specifically identifies the Maheu and Stassinos plaintiffs as several of the key witness who are beyond the court's subpoena power, including SEI employee, Joseph Guillen.
The RPIs further contend that even if XTO had met its burden to identify the evidence or witnesses it would be unable to obtain, maintenance of this lawsuit in Texas still would not work a substantial injustice to XTO because: (1) XTO still has access to these witnesses by virtue of their deposition testimony; and (2) 81% of the witnesses are not subject to compulsory process in North Dakota. This 81% figure is derived from the witness chart the RPIs prepared for the trial court.
The general rule in Texas is that a substantial injustice is worked upon a defendant litigating in Texas when the vast majority of the witnesses are not subject to compulsory process in Texas. See In re Mantle Oil & Gas, 426 S.W.3d at 192; In re BPZ Res., 359 S.W.3d at 875. The RPIs have not identified any legal authority making an exception to this rule based on the availability of deposition testimony. See, e.g., In re Mantle Oil & Gas, 426 S.W.3d at 192; In re BPZ Res., 359 S.W.3d at 875. Furthermore, the question presented here is whether maintenance of the lawsuit in a Texas court would work a substantial injustice to XTO, not the effect on XTO of a lawsuit in North Dakota.
XTO also argues that it will be prejudiced if the Texas lawsuit continues because they will have to develop three cases for trial under separate docket control orders where the same witnesses likely will have to be deposed in each case. The RPIs contend that XTO is at least partially responsible for any prejudice that it might experience as a result of having to develop multiple cases for trial because XTO could have resolved the Texas lawsuit if it had proceeded to try the case on August 28, 2017, rather than filing the motion to dismiss. This argument, however, assumes that this case could have gone to trial on its first trial setting. This suit could not have been tried on August 28, 2017, in Harris County because Hurricane Harvey struck the Texas Gulf Coast on August 25, 2017, and as a result of the damage in the Houston area, all civil jury trials in the Harris County Civil District Courts were cancelled for September and October 2017. Furthermore, it is relevant that the Stassinos and Maheu lawsuits in North Dakota have been consolidated for discovery and pretrial proceedings. Thus, if the Texas lawsuit is allowed to proceed, XTO will still have to prepare two cases for trial in two states under separate docket control orders utilizing the same witnesses.
The RPIs further contend that maintaining this lawsuit in Texas would not work a substantial injustice to XTO as evidenced by the fact that XTO and the other defendants litigated in the Texas court and engaged in discovery for nine months before XTO filed its motion to dismiss for forum non conveniens. It is undisputed that XTO's motion was timely filed. See generally TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(d) (setting deadline for filing motion to dismiss for forum non conveniens). XTO's participation in discovery does not undermine its claim that continuing to litigate in Texas would work a substantial injustice upon it given that the rule governing motions to dismiss for forum non conveniens expressly contemplates the necessity of discovery in order to support, or refute, a defendant's entitlement to dismissal. Id. ("The court shall afford all of the parties ample opportunity to obtain discovery of information relevant to the motion prior to a hearing on a motion under this section."); see also In re Pirelli Tire, 247 S.W.3d at 674 (recognizing need for discovery relevant to motion to dismiss).
Further, as XTO points out, facts undermining or refuting the RPIs' jurisdictional allegations were revealed less than a month before XTO filed its motion. For example, although RPI Pyle had initially alleged that he was a Texas resident, he supplemented his pleadings on April 20, 2017 and admitted during his deposition that same day that he had never lived in Texas. See generally TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(e) (stating court may not stay or dismiss plaintiff's claim if plaintiff is legal resident of Texas). He also testified that Jones, a consultant employed by Badlands, made the critical decision to snub the well, rather than kill it, during a safety meeting at the North Dakota well site. This testimony undermines the RPIs' allegations that a substantial portion of the events and/or omissions in this case occurred in Texas. Depositions taken on May 9, 2017 also revealed further details undermining the RPIs' allegations about the degree to which this lawsuit was connected to Texas. Namely, one witness testified that no one had told XTO that the well should have been killed and a second witness testified that he did not witness any discussions between XTO and Jones, the consultant that Pyle identified as having made the decision to snub the well, rather than kill it, during a safety meeting at the North Dakota well site. XTO filed its motion three days after these depositions on May 12, 2017.
XTO also argues that it is substantially unjust to force them to litigate in Texas because six potential wrongdoers—Tom Jones, Badlands Consulting LLC, Allan Kolden, Petroleum Experience, Inc., SEI, and Most Wanted—are not subject to personal jurisdiction in Texas and, as a result, they cannot be held accountable in the Texas lawsuit. The RPIs do not dispute that Texas courts do not have jurisdiction over these potential parties. Rather, the RPIs respond that XTO could name these entities and individuals as responsible third parties in the Texas lawsuit. Naming these potential defendants as responsible third parties in the Texas lawsuit, however, would not entitle XTO to contribution or indemnity from these parties. As the RPIs acknowledge, in the event XTO is found liable for any of the RPIs' injuries, XTO would then have to file a separate suit for contribution and indemnity in a North Dakota court, or some other court with jurisdiction over these potential defendants. This would be the fourth lawsuit arising out the incident. The prospect of an additional, separate suit for indemnity or contribution based for claims arising out of this same incident weighs in favor of dismissal and not against dismissal, as the RPIs suggest. See In re ENSCO, 311 S.W.3d at 925 (holding substantial injustice factor weighed in favor of dismissal when movant could only seek indemnity or contribution from potential defendant in another jurisdiction).
Petroleum Experience, Kolden, Badlands, and Jones are defendants in the Maheu and Stassinos lawsuits pending in North Dakota. Petroleum Experience and Kolden are North Dakota citizens. Badlands is a Wyoming company that was doing business in North Dakota at the time of the accident. Jones is a Montana citizen. Pavon's employer, SEI, and Pyle's employer, Most Wanted, are Wyoming companies that were also doing business in North Dakota at the time of the accident. SEI and Most Wanted are not named as defendants in the North Dakota lawsuits.
We conclude that it would be substantially unjust to require XTO to continue to litigate this case in Texas, given that the vast majority of the potential witnesses are not subject to compulsory process in Texas, and six potentially liable parties are outside the Texas court's jurisdiction and cannot be held accountable in this suit, thus creating the prospect of a fourth additional lawsuit arising out of the same incident. Therefore, the third factor weighs in favor of dismissal.
D. Jurisdiction over All Defendants
The fourth factor is whether the alternate forum can exercise jurisdiction over all the defendants. TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b)(4); In re ENSCO, 311 S.W.3d at 925. The RPIs argue that this factor does not weigh in favor of dismissal because XTO, Weatherford, and KLX have not consented to jurisdiction in North Dakota. Regardless of whether the defendants have affirmatively consented to jurisdiction in North Dakota, the record reflects that XTO, Weatherford, and KLX (1) purposefully conducted drilling-related activities in North Dakota, and (2) the accident allegedly arose out of and related to their activities in North Dakota. See Ensign v. Bank of Baker, 676 N.W.2d 786, 791-92 (N.D. 2004). As XTO acknowledges, this is sufficient for a North Dakota state court to exercise specific personal jurisdiction over it and the other defendants. Id. This factor, therefore, weighs in favor of dismissal.
E. Public and Private Interest Factors
The fifth factor requires the balancing of the public interests of the State and the private interests of the parties, and the court shall consider the extent to which the injury resulted from acts or omissions that occurred in Texas. TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b)(5); In re ENSCO, 311 S.W.3d at 926.
1. Public Interest Factors
Generally, the public interest factors to be considered are the administrative difficulties related to court congestion; burdening the people of a community with jury duty when they have no relation to the litigation; the local interest in having localized controversies decided at home; and trying a case in the forum that is at home with the law that governs the case. In re Gen. Elec., 271 S.W.3d at 691; In re Mantle Oil & Gas, 426 S.W.3d at 194.
XTO argues that dismissal is favored in this case because the Harris County district courts are far more congested than North Dakota courts. XTO cites to statistics showing the number of civil suits filed annually in Harris County district courts, the North Dakota district in which the incident occurred, and the United States District Court for the District of North Dakota. The RPIs contend that these general statistics are insufficient and do not provide evidence of any administrative difficulties actually faced by the trial court. According to the RPIs, the record demonstrates that the trial court's docket is manageable and that trial is currently set for the two-week period beginning March 26, 2018, which satisfies the Texas Supreme Court's guidelines for the scheduling of civil trials. The RPIs' argument, however, assumes that trial will go forward in March 2018. Notably, the March 2018 trial setting was announced prior to all civil trials in the Harris County district courts being cancelled for two months as a result of Hurricane Harvey. The March 2018 trial setting may no longer be viable given the backlog of civil trials created by the storm.
Next, XTO argues that Harris County does not have a localized interest in resolving this personal injury suit because the accident occurred in North Dakota, the plaintiffs are not Texas residents, the plaintiffs were not treated for their injuries in Texas, and the vast majority of the fact witnesses do not reside or work in Texas. According to XTO, it would be unfair to burden Harris County's citizens with this suit that has no significant connection to Texas other than the fact that the defendants have corporate offices here. See generally In re Mantle Oil & Gas, 426 S.W.3d at 194.
Even though that lawsuit does not directly involve any North Dakota residents, as the RPIs point out, North Dakota nevertheless has an interest in this personal injury suit because it involves allegations of negligence centered in North Dakota that resulted in injuries in North Dakota. See In re Pirelli Tire, 247 S.W.3d at 679 (stating that Mexico has an interest in "safety of Mexican highways and products within the country's borders"). North Dakota's interest in the safety of individuals who are working within its borders and the conduct of companies doing business in the state is stronger than any interest Texas may have in this lawsuit simply because the corporate defendants are located in Houston. See In re BPZ Res., 359 S.W.3d at 878 ("[T]he occurrence giving rise to the real parties' claims has a more substantial connection with Peru than it does Texas.").
The final public interest factor is whether the forum is at home with the law that governs the case and, therefore, whether a choice of law analysis is necessary. See Schippers v. Mazak Props., Inc., 350 S.W.3d 294, 300 (Tex. App.—San Antonio 2011, pet. denied). The parties agree that Texas recognizes a loss of parental consortium claim in personal injury cases that do not result in death whereas North Dakota does not. They disagree, however, as to whether North Dakota law or Texas law should govern the RPI's loss of parental consortium claims.
Which state's law governs an issue is a question of law for the court to decide. Torrington Co. v. Stutzman, 46 S.W.3d 829, 848 (Tex. 2000). In deciding choice-of-law issues, Texas courts use the "most significant relationship" test from the Restatements. Id.; Schippers, 350 S.W.3d at 300.
Section 6 of the Restatement sets out the following general factors relevant to the choice of law:
(a) the needs of the interstate and international systems,
(b) the relevant policies of the forum,
(c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue,
(d) the protection of justified expectations,
(e) the basic policies underlying the particular field of law,
(f) certainty, predictability and uniformity of result, andTorrington Co., 46 S.W.3d at 848 (quoting RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 6(2) (1971)). In a torts case, where the injury and tortious behavior occurred, the domicile of the parties, and the place where the relationship between the parties is centered are all relevant factors to consider. Torrington Co., 46 S.W.3d at 848 (citing RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145(2) (1971)). In such instances, the Restatement's "most significant relationship test" includes a presumption in favor of applying the law of the place of the injury. See RESTATEMENT (SECOND) OF CONFLICT OF LAWS §§ 145, 146; see also Enter. Products Partners, L.P. v. Mitchell, 340 S.W.3d 476, 480 (Tex. App.—Houston [1st Dist.] 2011, writ dism'd).
(g) ease in the determination and application of the law to be applied.
Specifically, section 146, governing personal injuries, creates a presumption that
the law of the local state where the injury occurred determines the rights and liabilities of the parties, unless, with respect to the particular issue, some other state has a more significant relationship under the principles stated in § 6 to the occurrence and the parties, in which event the local law of the other state will be applied.RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 146.
In this case, the RPIs' injuries occurred in North Dakota and the decision to snub the well, as opposed to killing it, was made in North Dakota according to RPI Pyle. The RPIs are residents of Colorado and XTO and the other defendants have their corporate offices in Texas. The RPIs' relationship to XTO and the other defendants is centered in North Dakota because the RPIs' only connection to these defendants is the work Pavon and Pyle performed on the Well in North Dakota and the injuries the RPIs' allegedly sustained as a result of the Incident in North Dakota. See Torrington Co., 46 S.W.3d at 848. Thus, the relevant factors applicable in tort cases indicate that North Dakota law should govern the RPIs' claims for loss of parental consortium. See RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145(2).
Furthermore, North Dakota has an inherent governmental interest in applying its damages and compensation laws to litigation arising out of oilfield accidents that occur within its borders. See generally Vizcarra v. Roldan, 925 S.W.2d 89, 92 (Tex. App.—El Paso 1996, no writ) (finding that Mexico does not recognize loss of consortium but has interest in applying that law to companies doing business in Mexico); see, e.g., Cornett, 998 A.2d at 552 (noting that state "undoubtedly has an interest in regulating the safety of any activities in [a local] facility that might have contributed to the injury"). Applying North Dakota law in such instances provides certainty, predictability, and uniformity of result for nonresident businesses that chose to conduct business in North Dakota. Although Texas has an interest in regulating the conduct of its resident corporations, it has little, if any, interest in protecting a nonresident plaintiff's right to recover damages for loss of parental consortium, especially when the plaintiff cannot recover such damages in its home state. See, e.g., id. (recognizing that state "has little interest in protecting the compensation rights of a [non-]resident").
Based on these factors, we hold that North Dakota has the "most significant relationship" to the RPIs' loss of parental consortium claims and this case has no place in a Texas court.
We further conclude that the public interest factors, as a whole, weigh in favor of dismissal.
2. Private Interest Factors
The private interest factors are generally considered to be the ease of access to proof, the availability and cost of compulsory process, the possibility of viewing the premises, if appropriate, and other practical problems that make trial easy, expeditious, and inexpensive. In re Gen. Elec., 271 S.W.3d at 691; In re Mantle Oil & Gas, 426 S.W.3d at 196.
With regard to the availability of the evidence, the parties agree that the equipment that Pavon and Pyle allege caused the underlying incident—the tubing (the string of drill pipe), the snubbing unit, and the bottom hole float valves—was transported from North Dakota and is now located in Texas. They disagree, however, as to relevance of this evidence with regard to the Texas lawsuit.
XTO argues that the location of this equipment is irrelevant because this is a personal injury case, not a products liability lawsuit. According to XTO, the "only allegation that remotely involved products were those alleging that Weatherford was negligent for supplying pipe and other equipment 'that were defective and/or improper for their anticipated use.'" It is undisputed that Weatherford is no longer a party to this lawsuit. The RPIs contend that even if we can disregard their products liability claims against Weatherford, as XTO argues, the physical evidence is still relevant with respect to their products claims against KLX, another defendant who supplied the bottom hole float valves at issue in this lawsuit.
Weatherford filed a motion for no-evidence summary judgment that was granted after XTO filed this petition for writ of mandamus and the suit against Weatherford was subsequently severed.
The presence of some evidence in Texas, however, is not dispositive. See generally In re Gen. Elec., 271 S.W.3d at 687 (stating that movant is not required to prove every statutory factor and every factor does not have to weigh in favor of dismissal for movant to be entitled to relief).
Although the bottom hole float valves may be relevant with respect to the RPIs' claims against another defendant, KLX, the majority of the witnesses in this case are outside the Texas trial court's jurisdiction and are not subject to compulsory process. This witness testimony is relevant with respect to all of the defendants, including XTO, and the unavailability of such testimony outweighs the benefit derived from the location of the equipment. We conclude that the private interests, as a whole, weigh in favor of dismissal.
3. Acts or Omissions
When balancing the private and public interests, courts must also consider the extent to which the injury resulted from acts or omissions that occurred in Texas. The RPIs alleged in their pleadings that the accident occurred because the Well was not "killed" prior to "snubbing" operations being conducted on the date of the accident. In its statement of facts, XTO states that the evidence adduced during discovery demonstrates that the decision to snub the well instead of killing it was made in North Dakota, not Texas. Specifically, RPI Pyle testified that even though he and others had told Badlands' consultant Jones that it was too dangerous to snub and that the well should be killed, Jones directed the crews to snub the well instead of killing it during a safety meeting at the Well on the date of the accident. A Colter Energy employee who was present at the well when the incident occurred testified that he had no knowledge that anyone ever told XTO engineers or completions foremen that they thought the well should be killed. The RPIs do not dispute these facts.
The RPIs have not contradicted these factual allegation, and therefore, we will accept these facts as true. See TEX. R. APP. P. 38.1(g) ("In a civil case, the court will accept as true the facts stated unless another party contradicts them.").
Having determined that the public and private interest factors, including evidence demonstrating that the RPIs' injuries resulted from acts or omissions that occurred in North Dakota, we conclude that the fifth factor weights in favor of dismissal.
F. Duplication or Proliferation of Litigation
The sixth factor is whether the stay or dismissal of the Texas lawsuit "would not result in unreasonable duplication or proliferation of litigation." TEX. CIV. PRAC. & REM. CODE ANN. § 71.051(b)(6). When XTO filed its petition for writ of mandamus, there were two other lawsuits pending in federal court in North Dakota arising out of this incident, Maheu and Stassinos. The dismissal of the Texas lawsuit and RPIs' filing of a new lawsuit in North Dakota as a result would only preserve the status quo with respect to the number of lawsuits pending from the same incident at three. Furthermore, the Maheu and Stassinos lawsuits were consolidated for discovery and pretrial proceedings while this proceeding was pending. XTO, Weatherford, and KLX are defendants in those federal lawsuits and do not contest jurisdiction in North Dakota. In light of these facts, the dismissal of the Texas lawsuit could possibly result in further consolidation of all three lawsuits in North Dakota federal court. See In re Mantle Oil & Gas, 426 S.W.3d at 198; see also In re ENSCO, 311 S.W.3d at 928 ("And as ENSCO points out, if this case is dismissed, it may result in consolidation of this claim with other claims already filed in Australia, thus reducing the amount of litigation. This last factor also weighs in ENSCO's favor."). We therefore conclude that the stay or dismissal of the Texas lawsuit would not result in unreasonable duplication or proliferation of litigation, and therefore this factor weighs in favor of dismissal.
G. Section 71.051(b) factors, as a whole
When we consider all of the section 71.051(b) factors, as analyzed above, we conclude that the factors weigh in favor of dismissing this case on forum non conveniens grounds. We therefore hold that the trial court erroneously denied XTO's motion to dismiss.
We sustain XTO's issue.
Conclusion
We conditionally grant XTO's petition for writ of mandamus. We direct the trial court to grant XTO's motion to dismiss for forum non conveniens. The writ will issue only if the trial court fails to do so.
Russell Lloyd
Justice Panel consists of Justices Keyes, Brown, and Lloyd.