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In re Lloyd's Register N. Am., Inc.

United States Court of Appeals, Fifth Circuit

February 24, 2015

In re: LLOYD'S REGISTER NORTH AMERICA, INCORPORATED, Petitioner

Page 284

[Copyrighted Material Omitted]

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Petition for a Writ of Mandamus to the United States District Court for the Southern District of Texas.

For In re: LLOYD'S REGISTER NORTH AMERICA, INCORPORATED, Petitioner: Eric J. R. Nichols, Gretchen Sims Sween, Beck Redden, L.L.P., Austin, TX.

For PEARL SEAS CRUISES, L.L.C., Respondent: John Devereux Kimball, Esq., William Tracy Freeman, Esq., Attorney, Keith Bernard Letourneau, Blank Rome, L.L.P., Houston, TX.

Before SMITH, ELROD, and HIGGINSON, Circuit Judges. JENNIFER WALKER ELROD, Circuit Judge, dissenting.

OPINION

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JERRY E. SMITH, Circuit Judge:

Lloyd's Register North America, Inc. (" LRNA" ), was the classification society responsible for certifying a ship that Irving Shipbuilding, Inc. (" Irving" ), was building for Pearl Seas Cruises, LLC (" Pearl Seas" ). Pearl Seas was dissatisfied with

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the ship and engaged in several years of arbitration and litigation with Irving. After those proceedings had concluded, Pearl Seas sued LRNA under various tort theories regarding LRNA's allegedly inadequate performance in certifying the ship and its alleged misdeeds during arbitration.

LRNA moved to dismiss on the ground of forum non conveniens (" FNC" ), claiming that a forum-selection clause in the Lloyd's Register Rules and Regulations for the Classification of Ships (the " LR Rules" ) and in the contract between LRNA and Irving required Pearl Seas to bring the claims in England. The district court denied the motion to dismiss without written or oral explanation. LRNA petitions for a writ of mandamus to direct the court to vacate its denial and dismiss for FNC. Because the district court clearly abused its discretion and reached a patently erroneous result, and because LRNA has no way effectively to vindicate its rights without a writ of mandamus, we grant the petition.

I.

The following facts are taken from Pearl Seas' First Amended Complaint. Pearl Seas and LRNA communicated in 2006 about LRNA's potentially providing classification services for the vessels Pearl Seas would be operating. Those classification services would require LRNA to certify that the ship complied with certain standards, including the requirements of the ship's flag state (the Marshall Islands) and the classification society's own rules. Pearl Seas agreed that LRNA would be the classification society for its ships.

Later in 2006, Pearl Seas entered into a contract (the " Shipbuilding Contract" ) with Irving under which Irving would build a ship for Pearl Seas. LRNA then entered into a contract (" Classification Contract" ) with Irving under which LRNA would survey the ship during construction, ensuring that it complied with the rules and regulations specified in the Shipbuilding Contract, including the LR Rules. As construction continued, disputes arose between Irving and Pearl Seas. Irving invoked the arbitration clause in the Shipbuilding Contract in 2008, and contentious arbitration continued until Irving and Pearl Seas settled in 2013.

II.

Pearl Seas sued LRNA in the court a quo in late 2013, alleging fraud, gross negligence, negligent misrepresentation, collusion, aiding and abetting, civil conspiracy, and promissory estoppel in tort. Each cause of action is essentially based on the theory that LRNA misrepresented the status of the vessel to Pearl Seas and to the arbitrators.

LRNA moved to dismiss for FNC, seeking enforcement of two forum-selection clauses that it said required the action to be brought in England. The first appears in the LR Rules and reads, " Any dispute about the Services or the Contract is subject to the exclusive jurisdiction of the English courts and will be governed by English law." The second appears in the Classification Contract between LRNA and Irving and reads, " Any dispute, claim, or litigation between any member of the LR Group and the Client arising from or in connection with the Services provided by LR shall be subject to the exclusive jurisdiction of the English courts and will be governed by English law." Irving claimed that both of these clauses prevented Pearl Seas from bringing this suit in Texas.

Pearl Seas maintained that neither applied, because Pearl Seas was not a signatory to any agreement containing a forum-

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selection clause. The district court held a hearing in which it questioned the parties about numerous matters, including the motion to dismiss for FNC. A few weeks later, the court issued an order denying several of the motions to dismiss and the plaintiff's motion for in camera inspection. The court " explained" its decision in one sentence: " Having considered the motions, submissions, and applicable law, the Court determines that all motions should be denied."

III.

To be entitled to the extraordinary remedy of mandamus, LRNA has to satisfy three requirements. First, it must have " no other adequate means to attain the relief [it] desires." Cheney v. U.S. Dist. Court for Dist. of Columbia, 542 U.S. 367, 380, 124 S.Ct. 2576, 159 L.Ed.2d 459 (2004). Second, it has to show a " clear and indisputable" right to the writ. Id. at 381. And third, the court " ...


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