508 F.3d 785 (5th Cir. 2007), 07-20364, DTEX, LLC v. BBVA Bancomer, S.A.

Docket Nº:07-20364
Citation:508 F.3d 785
Party Name:DTEX, LLC, Plaintiff-Appellant, v. BBVA BANCOMER, S.A.; Grupo Financiero BBVA Bancomer; Institucion De Banca Multiple, Defendants-Appellees.
Case Date:November 21, 2007
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 785

508 F.3d 785 (5th Cir. 2007)

DTEX, LLC, Plaintiff-Appellant,


BBVA BANCOMER, S.A.; Grupo Financiero BBVA Bancomer; Institucion De Banca Multiple, Defendants-Appellees.

No. 07-20364

United States Court of Appeals, Fifth Circuit

November 21, 2007

Revised Nov. 26, 2007.

Page 786

Kevin Augustus Dunlap, Parker, Poe, Adams & Bernstein, LLP, Spartanburg, SC, William E. Junell, Jr., Kay Johnson Hazelwood, Schwartz, Junell, Greenberg & Oathout, Houston, TX, for DTEX, LLC.

Thomas Henry Grace, William Steven Bryant, Locke, Lord, Bissell & Liddell, LLP, Houston, TX, for Defendants-Appellees.

Appeal from the United States District Court for the Southern District of Texas.

Before WIENER, GARZA, and BENAVIDES, Circuit Judges.

Page 787


Plaintiff-Appellant DTEX, LLC ("DTEX") appeals the district court's grant of a motion filed by Defendants-Appellees BBVA Bancomer, S.A.; Grupo Financiero BBVA Bancomer; Institucion de Banca Multiple ("Bancomer"), to dismiss DTEX's action on the basis of forum non conveniens in favor of a foreign forum, specifically, Mexico. DTEX is a South Carolina limited liability company; Bancomer is a Mexican banking corporation which is subject to the personal jurisdiction of the district court by virtue of its foreign bank agency located in Houston, Texas. DTEX had formerly sued Bancomer in South Carolina, but that action was dismissed for lack of personal jurisdiction, prompting DTEX to file the instant action in the Southern District of Texas.

This controversy commenced in Mexico several years ago and involves competing claims to textile manufacturing equipment (on the proceeds of its sale) on which Bancomer held a security interest and DTEX claimed ownership through a foreclosure sale, both parties asserting superiority of their respective claims. The long, dramatic, and sordid history of the parties' efforts to prevail is laid out in detail in the district court's April 2007 Memorandum and Order. And, even this ongoing conflict's relatively small chapter in the Southern District of Texas has produced a record on appeal comprising fourteen volumes, illustrative of the extent of this international brouhaha.

The district court dismissed DTEX's lawsuit on grounds of forum non conveniens, and we are here today on DTEX's appeal of that order. We have reviewed it for abuse of discretion, the standard by which we review such an order.1 It will become obvious to any reader of the district court's

Memorandum and Order that the facts and the law were considered in excruciating detail by that court before it granted its order, and that the court not only touched all the bases but exhaustively examined each. Our review of the record and the arguments advanced by the parties in their appellate briefs not only convinces us that there was no abuse of discretion by the district court, but that it committed no error under any standard of review. We are satisfied that nothing would be gained by our writing anything of substance on this matter in light of the trial court's thorough, clear and comprehensive exegesis on the subject of forum non conveniens. We therefore affirm the court's dismissal order for the reasons set forth in its analysis of the issues, adopt its Memorandum and Order by reference as the opinion of this court, and annex it hereto for the edification of our readers.



DTEX, LLC, Plaintiff,


BRVA BANCOMER, S.A., Defendant.

Civil Action No. H-06-0188.


SIGNED on April 9, 2007, at Houston, Texas.

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Lee H. Rosenthal United States District Judge

In January 2006, Dtex, L.L.C. ("Dtex"), a South Carolina company that trades in used textile equipment, sued BBVA Bancomer, S.A., Institution de Banca Grupo Financiero BBVA Bancomer ("Bancomer"), a Mexican banking corporation that maintains a permanent foreign bank agency in Houston, Texas. In both the original and amended complaints, Dtex sought damages for tortious interference with contract, intentional interference with prospective contractual relations, and conversion. (Docket Entries No. 20, 33). The claims arose from Bancomer's alleged interference with Dtex's rights to certain textile equipment, which Dtex purchased in Mexico in an auction sponsored by the Mexican government. Bancomer asserted a lien on the same textile equipment. Dtex's and Bancomer's competing claims to the equipment has been the subject of extensive and numerous legal proceedings in Mexican courts since 2002.

Dtex filed two lawsuits in the United States challenging Bancomer's actions with respect to the textile equipment in Mexico. In July 2004, Dtex sued Bancomer in the United States District Court for the District of South Carolina, asserting most of the causes of action later alleged in this case. (Docket Entry No. 30). That case was dismissed for lack of personal jurisdiction. Dtex then sued Bancomer in this court.

Bancomer's pending amended motion to dismiss is based on comity or forum non conveniens. (Docket Entry No. 45). Dtex has responded to the motion, (Docket Entry No. 50), Bancomer has replied, (Docket Entry No. 61), Dtex has surreplied (Docket Entry No. 66), and Bancomer has filed a surresponse, (Docket Entry No. 67).1

Based on a careful review of the pleadings, the motion to dismiss and response, the parties' submissions, and the applicable law, this court grants Bancomer's motion to dismiss on the basis of forum non conveniens. (Docket Entry No. 45). The reasons are set out below.

I. Background

The dispute between Bancomer and Dtex began with loans by Bancomer to a Mexican textile manufacturer located in Chihuahua, Mexico. That textile manufacturer, Denimtex, S.A. de C.V., borrowed approximately $30 million from Bancomer from 1994 through 2000. Bancomer claims that it received a first priority lien on certain textile equipment, including equipment at the Denimtex plant in Chihuahua, as security for the loans.

In 2000, Denimtex defaulted on the loans. In 2001 and 2002, Bancomer was involved in collection actions against Denimtex in Mexican courts, obtaining judgments. In 2002, in one of the foreclosure proceedings, the court appointed a judicial administrator to secure the equipment at the Denimtex plan on Bancomer's behalf. Dtex alleges that this administrator, Duarte Sanchez, was "hand-picked" by Bancomer and was "not an 'independent' judicial administrator, officer, or agent. He is in every respect Bancomer's man. He represents Bancomer's interests." (Docket Entry No. 51 at 7- 8). Bancomer asserts that Sanchez was independent and that his selection and activities were subject to court oversight. (Docket Entry No. 46 at 5, Ex. B at 2; Docket Entry No. 61, Ex. B at 19).

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In 2001, the Denimtex plant employees' union sued Denimtex for unpaid wages. In December 2001, the Mexican Labor Board granted the employees an award and judgment for the workers' wage claims. The Labor Board attached Denimtex's property, including the textile equipment at the plant, to secure the wage claims and conducted an auction of the equipment. Dtex asserts that the wage claims had a first priority lien on Denimtex's assets, superior to all existing claims, and that the tribunal conducting the auction published written notices of the auction as required by Mexican law. (Docket Entry No. 52 at 13-15).

In July 2002, Dtex submitted a winning bid at the auction for the equipment, 37,887,120 Mexican pesos (approximately $3,866,850). (Docket Entry No. 50 at 2). Dtex transferred the funds from its headquarters in South Carolina to the Labor Board in Mexico City. On July 25, 2002, Dtex entered into a contract to sell the equipment to a third party, Gibbs International, Inc., for $7,950,000. (Docket Entry No. 46, Ex. D at 17).

In August 2002, Bancomer filed a legal proceeding with the tribunal that had conducted the auction, challenging the validity of the auction under Mexican law. (Docket Entry No. 50 at 3; Docket Entry No. 46 at 4). Bancomer asserted that despite its status as the first-priority secured lienholder, it had not received proper notice of the auction and as a result had not submitted a bid. Dtex was not a party to this proceeding. Dtex alleged that Bancomer "falsely and fraudulently misrepresented to the Labor Board that, if it would conduct [another] auction, the defendant might find a third party to bid more money." (Docket Entry No. 20 at 8). On October 10, 2002, the tribunal ruled against Bancomer.

On October 28, 2002, Bancomer filed a proceeding called an "Amparo Indirecto" in a court in Mexico City, alleging that the tribunal conducting the auction had violated Bancomer's rights. (Docket Entry No. 50 at 4). At that time, Dtex was not a party in the proceeding. In the Mexico City Amparo proceeding, the court granted Bancomer's request for a stay preventing any entity, including Dtex, from taking possession of the textile equipment pending a full hearing. Bancomer was required to post a significant bond as a condition for the stay order.2 The stay was issued on December 6, 2002. On January 8, 2003, the court that had issued the stay ruled against Bancomer, dismissing its claim. (Docket Entry No. 20 at 9). Decisions in subsequent appeals, issued on February21 and May 14, 2003, affirmed this result. Dtex alleges that in the Mexico City Amparo proceeding, Bancomer used "its vast financial resources, as well as its tremendous influence and political power throughout Mexico" to obtain the stay "with the knowledge that it was not legally entitled to upset the plaintiff's winning bid." (Docket Entry No. 20 at 10). Dtex acknowledges that despite these efforts, the Mexican courts ruled against Bancomer. Dtex asserts that under Mexican law, the May 14, 2003 judgment fully disposed of Bancomer's challenge to the auction; Dtex claims the decision is res...

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