Union Pacific Railroad Co. v. Stouffer
Dallas Court of Appeals, No. 05-13-01224-CV (Dec. 19, 2013)
Justices FitzGerald (Opinion), Lang, and Myers
Lyndon Bittlehttp://www.ccsb.com/attorney/lyndon-bittle/
Victims of a collision between a Union Pacific train and a flatbed trailer carrying military veterans and their spouses in a parade in Midland sued Union Pacific in Dallas for personal injury and wrongful death. Union Pacific challenged venue on the ground that it had no “principal office” in Dallas County. The trial court denied the motion to transfer venue, and Union Pacific filed an interlocutory appeal. The Court of Appeals held that it had jurisdiction to consider the appeal and reversed the trial court.
The Court of Appeals first considered whether the interlocutory order was subject to appeal under section 15.003(b) of the Civil Practice and Remedies Code, as a “determination under Subsection (a) that . . . a plaintiff did or did not independently establish proper venue.” The Court noted that the quoted language was the result of a 2003 amendment to the statute, and held that the suit by several plaintiffs and intervenors against Union Pacific was encompassed by the amended statute. In reaching its decision, the Court agreed with a 2012 decision by the Corpus Christi Court of Appeals, Shamoun & Norman v. Yarto International Group, and disagreed with the position taken by the San Antonio Court of Appeals in 2010, in Basic Energy Services GP v. Gomez. According to the Dallas Court, the San Antonio court “erred by concluding that section 15.003(b) authorizes appeals only from venue decisions that are based on joinder rulings under section 15.003(a).” The Dallas Court construed the statute to authorize interlocutory appeals in multi-plaintiff cases in which the venue decision turns on general, permissive, or mandatory venue provisions.
Turning to the merits, the Court held that plaintiffs had not established that Union Pacific maintains a “principal office” in Dallas County, as required to trigger venue under Civil Practice and Remedies Code § 15.002(a)(3). The critical factor, the Court held, was the definition of “principal office” as a location where “the decision makers for the organization within this state conduct the daily affairs of the organization.” Although a company may have more than one principal office in Texas, that status is not established by the “mere presence of an agency or representative.” To satisfy the statute, the Texas Supreme Court requires plaintiffs to prove that employees in the forum venue have “substantially equal responsibility and authority” relative to officials in other Texas counties. Reviewing the evidence de novo, the Court found that, although the Union Pacific managers in Dallas County had significant authority over the company’s intermodal and automotive divisions based in Dallas County, plaintiffs had not shown they had “substantially equal responsibility and authority” to the corporate officers in the Harris County office.
Because it was undisputed that venue was proper in Midland County (where the events occurred and another defendant had its principal office), the Court reversed the trial court and remanded for an order transferring the case to Midland County.
