Antonio Leonard TNT Prods., LLC v. Goossen-Tutor Promotions, LLC
| Decision Date | 16 September 2014 |
| Docket Number | Civil Action No. H–13–3486. |
| Citation | 47 F.Supp.3d 500 |
| Parties | ANTONIO LEONARD TNT PRODUCTIONS, LLC, Plaintiff, v. GOOSSEN–TUTOR PROMOTIONS, LLC, and Dan Goossen, Defendants. |
| Court | U.S. District Court — Southern District of Texas |
Bennett G. Fisher, Fisher and Associates PC, Kenneth E. Broughton, Jr., Reed Smith LLP, Houston, TX, for Plaintiff.
Paul J. Dobrowski, Dobrowski LLP, Houston, TX, for Defendants.
Antonio Leonard TNT Productions, LLC (“Leonard Productions”) sued Goossen–Tutor Promotions, LLC (“GTP”) and its president, Dan Goossen, in Texas state court, alleging that the defendants had breached a partnership agreement with Leonard Productions to copromote certain boxers. (Docket Entry Nos. 1, Ex. 4; 12). The defendants timely removed to federal court and moved to dismiss based on a lack of personal jurisdiction and issue preclusion. They also moved to compel Leonard Productions to arbitrate its claims.1 (Docket Entry Nos. 5, 19).
Based on the briefs, the pleadings, the parties' submissions, and the applicable law, this court denies the motion to dismiss for lack of personal jurisdiction, denies the motion to apply issue preclusion, and grants the motion to compel arbitration. (Id. ). The motion for a preliminary injunction, (Docket Entry No. 3), the motion for a protective order, (Docket Entry No. 35, amended as Nos. 37 and 41), and the motion to compel production, (Docket Entry No. 42), are denied as moot.
No later than September 26, 2014, the parties are to file a statement identifying reasons this case should not be dismissed with prejudice (as opposed to stayed) in favor of arbitration.
Leonard Productions, Goossen, and GTP are in the business of boxing promotion. GTP is incorporated and located in California. Its president, Goossen, is a California citizen. GTP is registered with the California State Athletic Commission (CSAC), a state entity that regulates boxing matches. Leonard Productions is a Texas limited liability corporation. Its president and sole member is Antonio Leonard, a Texas citizen. (Docket Entry No. 1 at 3).
In 2004, GTP and Square Ring, Inc. entered into a Promotional Agreement with Andre Ward, a successful boxer. The Promotional Agreement gave GTP and Square Ring the exclusive right to promote Ward's boxing matches from 2004 to 2009. The Agreement contained an arbitration clause stating that “all controversies concerning the validity and/or enforceability of the promotional contract and this addendum shall be submitted for arbitration” to the CSAC. (Docket Entry No. 1, Ex. 4, Exs. 1–B and 1–C). In 2004, GTP and Square Ring also signed a separate Copromotion Agreement relating to and incorporating their Promotional Agreement with Ward. The Copromotion Agreement specified that GTP and Square Ring would evenly split the costs and net revenues from the Promotional Agreement with Ward. (Docket Entry No. 1, Ex. 4, Ex. 1–A).
In 2008, Square Ring sold its interest in the Copromotion Agreement to Leonard Productions. (Docket Entry No. 1, Ex. 4, Ex. 1). After this sale, Leonard Productions provided various promotional services for Ward's boxing matches under the 2004 Promotional Agreement until it expired in 2009. (Docket Entry No. 19, Ex. 7 at 3). Leonard Productions alleges that in 2011, it entered into an oral copromotional agreement with GTP. Leonard Productions alleges that “the parties agreed that they would continue to conduct business together along the same terms as the 2004 agreement and that Leonard, GTP and Goossen would continue to act in partnership in the copromotion of fights involving Andre Ward.” (Docket Entry No. 1, Ex. 4, Ex. 1). Leonard Productions alleges, and GTP denies, that the oral copromotional agreement contemplated promoting other boxers besides Ward, and significant activities in Texas by Leonard Productions and GTP. (Id. ).
Leonard Productions alleges that it, GTP, Goossen, and Ward together decided to promote and hold six boxing matches for Ward over three years. Leonard Productions alleges that the parties agreed that GTP and Leonard Productions would copromote Ward's matches, sharing revenues and losses equally. (Docket Entry No. 19, Ex. 7 at 4). GTP and Ward were the only parties to the written Exclusive Promotional Agreement that Leonard Productions alleges resulted from these discussions. (Docket Entry No. 12 at 4). The Exclusive Promotional Agreement stated that: GTP was Ward's exclusive promoter; California law applied; and the parties agreed to arbitrate “[a]ny controversies and/or disputes concerning and/or arising under this Agreement and/or arising under the Addendum” before the CSAC. (Docket Entry No. 19, Ex. 2 at 17). Leonard Productions was not a party to or mentioned in the written Exclusive Promotional Agreement. Leonard Productions explains this omission by the fact that it was not registered as a boxing promoter with the CSAC. (Docket Entry No. 19, Ex. 7 at 4). Goossen told Leonard in an e-mail that “[a]s you and I have discussed in the past and recently, to be listed on the [A]greement (which is no problem) you need to become a licensed promoter in California, which you've said is not a problem for you not to be listed on the [A]greement.” (Id. ). Although Leonard Productions was not included in the Exclusive Promotional Agreement, GTP and Ward allegedly treated Leonard Productions as Ward's copromoter, and Leonard Productions copromoted Ward's matches as Square Ring had in the past. (Docket Entry No. 19, Ex. 7 at 4).
The first of the six boxing matches provided for in the Exclusive Promotional Agreement went as planned in September 2012. (Id. at 2). Leonard Productions received 50 percent of the net revenue from that first match. (Id. at 5). GTP entered into an agreement with HBO to broadcast the match to HBO's subscribers in exchange for a flat fee. HBO's subscribers are located throughout the United States, including Texas. .
In early 2013, the relationship between Ward and GTP deteriorated. Ward invoked the arbitration clause under the Exclusive Promotional Agreement, seeking an order declaring the Exclusive Promotional Agreement void because GTP had not disclosed the oral copromotional agreement with Leonard Productions to the CSAC. (Docket Entry No. 19, Ex. 7).
An arbitrator appointed by the C SAC held hearings. Antonio Leonard attended as a nonparty witness and was present throughout the arbitration. (Docket Entry No. 27, Ex. 2). Goossen, Ward, Leonard, and Ward's manager James Prince all testified that they had intended Leonard Productions to copromote Ward's matches with GTP. (Docket Entry, No. 19, Ex. 7).
The arbitrator concluded that GTP's failure to disclose the oral copromotional agreement with Leonard Productions to the CSAC violated both California law and the Exclusive Promotional Agreement. The arbitrator, however, declined to void or invalidate the Exclusive Promotional Agreement because Ward knew of and encouraged the copromotional relationship. The arbitrator's order concluded: “[t]he Commission hereby finds that the Exclusive Promotional Rights Agreement dated April 6, 2011 between Andre Ward and Dan Goossen is valid.” (Docket Entry No. 19, Ex. 7 at 17–18). The arbitrator's order also stated that “the remedy for breaches of [the obligation to disclose any copromotional agreement to the CSAC] are the voiding of the outside agreements, the agreement or agreements involving Mr. Leonard, not the Agreement between Mr. Ward and Goossen–Tutor Promotions, LLC.” (Id. at 16).
Shortly after the arbitration order issued, GTP informed Leonard Productions that it would not honor any agreement to copromote Ward. (Docket Entry No. 1, Ex. 4). Leonard Productions sued GTP and Goossen in Texas state court, claiming that they had breached their copromotional agreement with, and fiduciary duty to, Leonard Productions. (Id. ). GTP and Goossen timely removed on the basis of diversity jurisdiction and moved to dismiss for lack of personal jurisdiction. Alternatively, they argue that the validity of the oral copromotional agreement between GTP and Leonard Productions was conclusively determined by the CSAC arbitration. The defendants also moved to compel Leonard Productions to arbitrate its claims before the CSAC.
Each of these issues is examined in turn.
Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, the “plaintiff bears the burden of establishing a district court's jurisdiction over a non-resident, but it need only make a prima facie case” if the district court does not conduct an evidentiary hearing. Johnston v. Multidata Sys. Int'l Corp., 523 F.3d 602, 609 (5th Cir.2008) (citing Wilson v. Belin, 20 F.3d 644, 648 (5th Cir.1994) ). In deciding whether personal jurisdiction exists, “the district court may receive ‘any combination of the recognized methods of discovery,’ including affidavits, interrogatories, and depositions to assist it in the jurisdictional analysis.” Little v. SKF Sverige AB, No. H–13–cv–1760, 2014 WL 710941, at *3 (S.D.Tex. Feb. 24, 2014) (quoting Walk Haydel & Assocs., Inc. v. Coastal Power Prod. Co., 517 F.3d 235, 241 (5th Cir.2008) ).
“Proof by a preponderance of the evidence is not required.” Johnston, 523 F.3d at 609 (citing Bullion v. Gillespie, 895 F.2d 213, 217 (5th Cir.1990) ). “ ‘[O]n a motion to dismiss for lack of jurisdiction, uncontroverted allegations in the plaintiff's complaint must be taken as true, and conflicts between the facts contained in the parties' affidavits must be resolved in the plaintiff's favor for purposes of determining whether a prima facie case for personal jurisdiction exists.’ ” Id. (quoting D.J. Invs., Inc. v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542, 546 (5th Cir.1985) ). “When the factual differences are found in favor of [a plaintiff] at this motion phase in the litigation ... [it]...
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