Dallas Court of Appeals, No. 05-20-00595-CV (July 15, 2020)
The appeals court explained, “When two inherently interrelated suits are pending in two counties, the court in which suit is first filed generally acquires dominant jurisdiction to the exclusion of other courts if venue is proper there.” The Court had no difficulty concluding the two lawsuits were logically and “inherently interrelated,” because “the same facts will be dispositive in both suits.” It also brushed aside Alex’s argument that the “first-filed” rule should not apply because Ahmed had engaged in “inequitable conduct” and had no “bona fide intention to prosecute the [Collin County] suit.” Ahmed had excercised ample diligence in pursuing his lawsuit, the Court held, and brief delays in seeking citation and effecting service did not show otherwise.
The major point of contention was venue. In his Collin County action, Ahmed had sought injunctive relief against Alex, a Harris County resident, as well as the appointment of a receiver for the businesses, one of which allegedly was domiciled in Harris County, albeit ostensibly to protect real estate held by the company in Collin County. Section 65.023 of the Civil Practice and Remedies Code—regarding injunctions—and sections 11.401 and 11.402(b) of the Business Organizations Code—regarding receiverships—would seem to make venue in Harris County mandatory for such claims. But, the panel majority said, those mandatory venue provisions do not apply unless the request for injunctive or receivership relief is the “primary” focus of the lawsuit. Here, it reasoned, because Ahmed’s live pleadings sought a receiver only with respect to real property in Collin County and that and his request for injunctive relief were “simply to maintain the status quo pending resolution of the lawsuit,” those requests were “ancillary” and not the “primary” relief sought. Venue therefore was not mandatory in Harris County.
The dissent took a different view of Ahmed’s pleadings and requests for relief. It argued that Ahmed’s live pleading expressly sought permanent as well as temporary injunctive relief, and that the request for a receivership, even if focused on Collin County real property, extended to the Harris County entity that apparently owned that property. Neither request for relief, therefore, could be regarded as “ancillary,” the dissent contended, and therefore the statutes mandating venue in Harris County applied, supporting the trial court’s decision and rendering mandamus relief inappropriate.