Buc-EE's Ltd. v. Bucks, Inc.

          MEMORANDUM AND ORDER

          Laurie Smith Camp Chief United States District Judge

         This matter is before the Court on the Motion to Change Venue or, Alternatively, to Stay, ECF No. 97, filed by Plaintiff Buc-ee's Limited, and on the Motion to Stay Case Progression, ECF No. 92, filed by Defendants Bucks, Inc., and Steven Buchanan. For the reasons stated below, Buc-ee's Motion will be denied and the Defendants' Motion will be granted.

         BACKGROUND

         Buc-ee's owns and operates convenience stores throughout Texas under its registered “BUC-EE'S” trademark. Steve Buchanan is the president and sole capital stock holder of Buck's, that also owns and operates convenience stores under its registered “BUCKY'S” trademark. Buck's applied to register its BUCKY'S mark with the United States Patent and Trademark Office (USPTO) on January 4, 2006. Buc-ee's applied to register its BUC-EE'S mark on April 3, 2006, but the USPTO suspended the application until its evaluation of the BUCKY'S application concluded. Thereafter, on June 13, 2007, Buc-ee's filed a notice of opposition to the BUCKY'S application with the Trademark Trial and Appeal Board. On December 2, 2008, Buck's filed a complaint against Buc-ee's with this Court. By September 16, 2009, Buck's and Buc-ee's had entered into a Co-existence Agreement (Agreement) that disposed of the litigation, ^[1]permitted each of them to register their respective trademarks with the USPTO, and further “memorialize[d] their respective rights in and to their respective trademarks . . . .” Agreement, ECF No. 88-25.

         On March 14, 2017, Buc-ee's filed a complaint against Bucks, BSD Bright Sight Development LLC, Nathan Richardson, and Tildon Sun Development, LLC, in the United States District Court for the Southern District of Texas. ECF No. 1. Buc-ee's alleged the foregoing defendants were cooperating to construct and operate convenience stores in Houston, Texas, under the BUCKY'S trademark in violation of the Agreement and Texas and federal law. The complaint asserted claims for trademark infringement, trademark dilution, unfair competition, false designation, and unjust enrichment. Pursuant to a forum selection clause in the Agreement, the Southern District of Texas severed Buck's from the case and transferred the claims against Buck's to the District of Nebraska. ECF No. 54, Page ID 1396. After the claims against Buck's were transferred, Buc-ee's filed an Amended Complaint adding claims for inducement by fraudulent and material misrepresentation, fraudulent misrepresentation, negligent misrepresentation, and breach of contract against Buck's and Steve Buchanan. ECF No. 77.^[2]

         Buck's moved for summary judgment before discovery commenced, arguing it is entitled to judgment on Buc-ee's claims, as a matter of law, because the Agreement precludes many of Buc-ee's claims and the remaining claims are “meritless.” Def.'s Br. Summ. J., ECF No. 87, Page ID 1820. As such, Buck's has also moved for a stay of discovery pending the Court's ruling on the summary judgment motion. Buc-ee's has moved to transfer this case back to the Southern District of Texas or, alternatively, to stay all proceedings until the remaining claims before the Southern District of Texas are resolved. The Court will address the motion to retransfer and the Parties' motions to stay, respectively.

         I. Motion to Retransfer

          Standard of Review

         “Motions to retransfer are not readily granted, and are only appropriate where the ruling of the transferor court is clearly erroneous and would result in manifest injustice.” Steen v. Murray, 955 F.Supp.2d 1030, 1033 (D. Neb. 2013), aff'd 770 F.3d 698 (8th Cir. 2014)^[3] (citing Jenkins Brick Co. v. Bremer, 321 F.3d 1366, 1370 (11th Cir. 2003)); see also Charles Alan Wright et al., Federal Practice and Procedure § 3846 (4th ed.) (federal courts are reluctant to grant motions to retransfer, but have the “power to do so if the contention is that the transferor court lacked the power to order the transfer . . .”). This Court has previously explained that motions to retransfer “are governed by the doctrine of the law-of-the-case, ” and that the “doctrine applies ‘with even greater force to transfer decisions than to decisions of substantive law; transferee courts that feel entirely free to revisit transfer decisions of a coordinate court threaten to send litigants into a vicious circle of litigation.'” Steen, 955 F.Supp.2d at 1033 (quoting Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 815-16 (1988)). “As most commonly defined, the doctrine . . . posits that when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case, ” unless clearly erroneous. Id. “[T]he clear error exception to the law-of-the-case doctrine applies to legal errors.” Jenkins, 321 F.3d at 1370 (citing Christianson, 486 U.S. at 817. Thus, a motion to retransfer will not be granted unless the initial transfer was a clear legal error. Id.

         Discussion

         Under Supreme Court and Fifth Circuit precedent, the Southern District of Texas severed Buck's from the Texas Lawsuit and transferred the claims against it to the District of Nebraska pursuant to a forum-selection clause in the Agreement.^[4] ECF No. 54, Page ID 1405-11; Atl. Marine Constr. Co., Inc. v. U.S. Dist. Court for the W. Dist. of Tex., 134 S.Ct. 568, 581 (2013) (district courts should give valid forum-selection clauses “controlling weight in all but the most exceptional circumstances”) (internal quotation omitted). The Parties agree the forum-selection clause is valid and the Southern District of Texas found that Buc-ee's claims against Buck's “fall[ ] within the scope of the forum-selection clause.” ECF No. 54, Page ID 1396. The Southern District further found there were no exceptional circumstances that justified disregarding the Parties' bargained-for forum-selection clause.

         Buc-ee's now argues the Court is required to retransfer the claims against Buck's back to the Southern District of Texas because the remaining defendants in the Texas Lawsuit have, since the transfer of Buck's to the District of Nebraska, asserted Buck's is an indispensable party to that litigation. See, e.g., In re: Howmedica Osteonics Corp., 867 F.3d 390, 404 (3d Cir. 2017) (severance is “clearly disallowed” when a party is indispensable under Federal Rule of Civil Procedure 19). That assertion, however, does not automatically make Buck's an indispensable party to the Texas Lawsuit, and Buc-ee's has provided no substantive argument regarding Buck's indispensability. EEOC v. Cummins Power Generation Inc., 313 F.R.D. 93, 98 (D. Minn. 2015) (a non-party is not indispensable unless it is first shown that they are a required party under Rule 19(a)(1) (citing Rochester Methodist Hosp. v. Travelers Ins. Co., 728 F.2d 1006, 1016 (8th Cir. 1986)). Nor did Buc-ee's argue Buck's was indispensable when the court in the Southern District of Texas was considering the propriety of the initial transfer to this district. Thus, Buc-ee's has not demonstrated that retransfer is required because Buck's is indispensable to the Texas Lawsuit.

         Buc-ee's also argues Buck's should be retransferred under the “first-to-file rule.” See, e.g., Mckinney Drilling Co., LLC v. Liberty Mut. Ins. Co., No. 5:16-CV-05078, 2016 WL 3349326, at *1 (W.D. Ark. June 15, 2016) (citing Orthmann v. Apple River Campground, Inc., 765 F.2d 119, 121 (8th Cir. 1985)). The rule provides “that in cases of concurrent jurisdiction, ‘the first court in which jurisdiction attaches has priority to consider the case.'” Mckinney, 2016 WL 3349326, at *1 (quoting Nw. Airlines, Inc. v. Am. Airlines, Inc., 989 F.2d 1002, 1005 (8th Cir. 1993)). Furthermore, it “recognizes the comity between coequal federal courts and promotes the efficient use of judicial resources by authorizing a later-filed, substantially similar action's transfer, stay or dismissal in deference to an earlier case.” Nat'l Football League Players Ass'n v. Nat'l Football League, Civ. No. 15-3168 (RHK/HB), 2015 WL 7596934, at *1 (D. Minn. July 30, 2015) (citing Orthman, 765 F.2d at 121). It is not a “rigid, mechanical, or inflexible” rule and should “be applied in a manner best serving the interests of justice.” Nw. Airlines, 989 F.2d at 1005 (quoting United States Fire Ins. Co. v. Goodyear Tire & Rubber Co., 920 F.2d 487, 488-89 (8th Cir. 1990)).

         The first-to-file rule is meant to facilitate “the doctrine of federal comity” and a retransfer of this case back to the Southern District of Texas is inconsistent with that doctrine. See Orthmann, 765 F.2d at 121. This Court finds no clear legal error with the Southern District of Texas's decision to sever and transfer the claims against Buck's to this district, and a retransfer would disregard that court's well-reasoned decision. This Court also ...