Preview
8/16/2018 4:11 PM
Chris Daniel - District Clerk Harris County
Envelope No. 26823464
By: Bristalyn Daniels
Filed: 8/16/2018 4:11 PM
CAUSE NO. 2018-47783
DOWNHOLE TECHNOLOGY, LLC, §
IN THE DISTRICT COURT
§
Plaintiff, §
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vs. §
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§
HARRIS COUNTY, TEXAS
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REPEAT PRECISION, LLC AND ADAM §
CURRY, §
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164TH JUDICIAL DISTRICT
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Defendants. §
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DOWNHOLE TECHNOLOGY, LLC’S RESPONSE
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TO DEFENDANTS’ PLEA IN ABATEMENT
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Defendant Downhole Technology, LLC (“Downhole Technology”) files this response to
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the Plea in Abatement filed by Defendants Repeat Precision, LLC (“Repeat Precision”), R.J.
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Machine Company, Inc. (“RJ”), W. Grant Martin (“Martin”) and Adam Curry (“Curry)
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(collectively, Defendants).1
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I. INTRODUCTION
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Defendants—not Downhole Technology—have “forum shopped” in this case. This case
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concerns Curry’s breach of the non-compete and nondisclosure provisions of the employment
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agreement that he entered into as a salesperson for Downhole Technology. Curry’s employment
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agreement made clear that Harris County was the only appropriate forum and venue for disputes
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concerning Curry’s employment or the agreement. Indeed, Defendants do not contend that
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venue is improper in Harris County, but rather that it filed first and thus acquired dominant
jurisdiction.
1
Since the Plea in Abatement was filed, Downhole Technology has filed a non-suit as to Martin and RJ.
40793289.3
When Curry breached the agreement to work for a competitor (Repeat Precision),
Downhole Technology sent a demand letter attaching a pleading it planned to file imminently in
Harris County. Curry and Repeat Precision asked Downhole Technology’s attorneys to stand
down so that the parties could negotiate a resolution.
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Instead, however, Curry and Repeat Precision pretended to negotiate while assembling
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and filing an action in Burnet County—an improper venue. In the Burnet County lawsuit, Curry
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and Repeat Precision make only one claim: a request for declaratory judgment that the non-
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compete is invalid, based on a purported lack of confidential information supporting the non-
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compete.2 None of the parties to the case are located in Burnet County. None of the events
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giving rise to the claim occurred in Burnet County. And the agreement expressly names Harris
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County, Texas as the sole forum and venue and expressly waives the right to challenge venue in
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the clearly appropriate forum of Harris County.
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Downhole Technology—the true plaintiff in this case—learned of the Burnet County
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lawsuit on July 17 and filed its Harris County lawsuit on July 18.
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The Plea in Abatement should be denied for four reasons. First, the mandatory venue
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statute governing suits for injunctive relief requires that this case be heard in Harris County.
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Tex. Civ. Prac. & Rem. Code § 65.023. Common law dominant jurisdiction based on the first
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filed action does not overcome statutory mandatory venue. This case must be heard in Harris
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County.
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Second, Defendants cannot rely on the theory of dominant jurisdiction because their
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inequitable conduct—pretending to be discussing a settlement agreement while preparing a
lawsuit—prevented Downhole Technology from being the first to file. Texas courts do not allow
2
Adam Curry has already testified that Downhole Technology possessed confidential information and he had access
to it – thus already gutting the substantive allegations of his Burnet County lawsuit.
40793289.3 2
parties to use such underhanded schemes to win a race to the courthouse. Hiles v. Arnie & Co.,
P.C., 402 S.W.3d 820 (Tex. App.—Houston [14th Dist.] 2013, pet. denied).
Third, dominant jurisdiction does not exist where the moving party does not prove that its
suit was first-filed in a county of proper venue. See Gonzalez v. Reliant Energy, Inc., 159
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S.W.3d 615, 622 (Tex. 2005). Tellingly, the Movants do not even attempt to prove (1) that
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venue in this case would be proper in Burnet County or (2) that venue in the Burnet County case
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is proper. It would be risky indeed for counsel to represent to this Court that venue is proper in
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Burnet County because even in the case pending there, venue is based on manufactured facts that
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are already proven false by Defendants’ own deposition testimony. Downhole Technology has
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already filed a motion to transfer venue in that case setting out why venue is not proper in that
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Court.3 Burnet County is an improper venue, and therefore dominant jurisdiction does not apply.
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The Plea in Abatement should be denied.
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Fourth, Curry agreed in his Employment Agreement to litigate disputes in Harris
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County—a proper venue—and expressly waived the right to challenge that proper venue. A
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choice of venue clause that identifies a proper venue is enforceable.
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Finally, despite the venue dispute, this Court still has jurisdiction over this suit and
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should grant Downhole Technology’s requested temporary injunction notwithstanding the
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pending venue dispute. Dodd v. Evergreen National Construction, LLC, 2017 WL 2645041 at
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*3 (Tex. App.—Houston [1st Dist.] 2017, no pet.) (holding that plea to jurisdiction based on
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dominant jurisdiction did not deprive the court of jurisdiction to rule on temporary injunction,
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and did not make the temporary injunction order defective). Indeed, it is telling that Defendants
3
A true and correct copy of the Motion to Abate, or in the Alternative, Motion to Transfer Venue, is attached as
Exhibit I and incorporated by reference.
40793289.3 3
have not set their Motion to Transfer Venue4 for hearing—indicating that the plea in abatement
is simply being used in an attempt to stall the ruling on the temporary injunction, rather than
pursuing a ruling on the proper venue.
II. FACTUAL BACKGROUND
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A. Curry’s Agreement and Breach of the Agreement
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Founded in 2010, Downhole Technology is a leading provider of high quality, high-
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performance composite frac plugs for the hydraulic fracturing industry. Curry worked for
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Downhole Technology as a Frac Plug Advisor for the Northeast Region of the United States,
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managing customer accounts in that region by conducting field support and making sales calls to
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customers and potential customers of Downhole Technology. Downhole Technology provided
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Curry with access to its trade secrets and other commercially sensitive business information
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related to its sales and marketing strategies, products, and customers’ needs and preferences,
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among other things, to allow Curry to carry out his duties.
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In exchange, Curry executed the Employment Agreement (attached as Exhibit A-1 and
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referred to as the “Agreement”) which contained provisions, including a non-competition
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provision and non-disclosure provision, to protect Downhole Technology’s confidential and
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trade secret information.
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The Agreement was negotiated by Downhole Technology at its principal place of
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business in Houston, Harris County, Texas, while Curry resided in and worked in Pennsylvania.
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(See Affidavit of Jessica Small, attached as Exhibit A at ¶2). No party to the Agreement resided
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in Burnet County. (Exhibit A at ¶2). Curry never did any work for Downhole Technology in
4
The Defendants’ Plea in Abatement may not be used as a motion to transfer venue. In order to obtain a transfer of
venue, Defendants must comply with Rule 87 of the Texas Rules of Civil Procedure, which requires at least 45 days
notice of a hearing on the motion to transfer.Geochem Tech Corp. v. Verseckes, 962 S.W.2d 541, 543 (Tex. 1998)
(“We no longer have a “plea of privilege” under our venue statutes and rules. Instead, a party seeking to transfer
must file a motion objecting to venue. See Tex. R. Civ. P. 86.”)
40793289.3 4
Burnet County. (Id.) Nothing relating to the negotiation of the Agreement or Curry’s work
under the Agreement occurred in Burnet County. (Id.)
Curry abruptly quit his employment with Downhole Technology, and Downhole
Technology later learned that Curry was working for one of Downhole Technology’s direct
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competitors in the composite frac plug industry, Repeat Precision, as a District and Sales
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Manager. Downhole also learned that Repeat Precision hired Curry to develop the same
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region—and solicit the same customers—that he had called on for Downhole, and that Repeat
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Precision had not previously had any sales in that region.
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B. Curry and Repeat Precision Feign Settlement Negotiations
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On June 13, 2018, counsel for Downhole Technology sent Curry a letter demanding that
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he comply with the Agreement. (Exhibit A-2). The demand letter required a response by 5:00
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pm CST on June 14, 2018, and noted that if Curry ignored Downhole Technology’s demands, it
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“will file the attached lawsuit requesting temporary and permanent injunctive relief designed to
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curtail your unlawful competition…” (Id.) The demand letter attached the pleading that
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Downhole Technology intended to file if Curry did not respond by June 14, 2018. (Id.) That
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same day, Downhole Technology’s counsel provided a copy of the Demand Letter to Repeat
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Precision.
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On June 14, 2018, Jim Cleary (“Cleary”), on behalf of Curry and Repeat Precision,
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contacted Downhole Technology’s counsel, asking that they discuss the matter. (Exhibit A-3).
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Cleary, on behalf of Curry and Repeat Precision, indicated a desire that the parties attempt to
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negotiate a settlement without counsel involved in the negotiations. On June 18, Cleary sent
Downhole Technology’s counsel an email proposing a resolution:
I wanted to assure you that Mr. Curry has not used, and has no intention of using
Downhole Technologies' confidential information or property. While we disagree
40793289.3 5
that the list of customers contained in your letter is an accurate depiction of his
customers or prospects for your client, he will not solicit his former customers or
prospective customers for the time being. The management of Repeat would be
open to discussing a list of off-limit clients for the restricted period. Can we
connect the Downhole Technology management team for a business person
discussion?
(Id.) Counsel for Downhole Technology agreed to allow the proposed negotiation between
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business management and began proposing dates for the meeting. (Id.)
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Robert Nipper, Repeat Technology’s President and Manager (See Repeat Precision’s
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Answers and Objections to Plaintiffs Expedited First Set of Interrogatories, attached as Exhibit
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B, at Interrogatory No. 6; Exhibit A-8), advised Ismail Nawaz, Downhole Technology’s
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President, that he was in charge of negotiations on behalf of Repeat Technology. (Exhibit A at
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¶7). Nipper offices in Harris County. Bu
(Exhibit E at 53:13-17; Exhibit A-8).
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On June 28, 2018, the parties agreed to meet in Houston (Exhibit A-4) and met there on
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July 9, 2018, to continue settlement discussions, including working on the list of customers that
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would be restricted. (Exhibit A at ¶7).
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On July 11, 2018, Grant Martin (“Martin”), on behalf of Repeat Precision, emailed
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Downhole Technology a “list [of customers] that we would be willing to agree to.” (Exhibit A-
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5). That same day, when Ismail Nawaz (“Nawaz”), on behalf of Downhole, indicated that the
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list was not acceptable. Robert Nipper (“Nipper”), on behalf of Repeat Precision, stated in an
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email that Martin would contact him but was traveling, and said, “Thanks for bearing with us”—
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indicating that the parties were still working on a settlement agreement. (Id.) Downhole later
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learned that this was just a ruse so that Curry and Repeat Precision could win a race to the
courthouse before Downhole even knew there was a race to be run. Curry and Repeat Precision
surreptitiously filed a lawsuit in Burnet County (the “Burnet County Lawsuit”) on July 12, 2018,
the day after sending this email. The Burnet County Lawsuit solely requests that the court enter
40793289.3 6
declaratory judgment that the non-compete provision is unenforceable. (A true and correct copy
of the current petition in the lawsuit is attached as Exhibit C.)
Curry and Repeat Precision did not serve or notify Downhole Technology of the Burnet
County lawsuit, but rather continued the charade of settlement. On July 17, 2018, Nawaz sent
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Nipper a proposed list so that he could “pass it through our legal to formulate an official
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understanding,” and stated that if it was not acceptable, “then [Downhole] will ask legal to
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proceed with their original proposed action plan”—that is, file a lawsuit. (Exhibit A-5). Nipper
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responded by asking for a call, indicating his desire to continue settlement negotiations. (Id.)
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C. The Burnet County Lawsuit
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Despite Curry and Repeat Precision’s continuing indications that the parties were
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completing settlement negotiations, on July 18, 2018, Downhole Technology learned that Curry
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and Repeat Precision had filed suit in Burnet County solely asking that the Court declare that the
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non-compete is invalid. (Exhibit C).
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Curry and Repeat Precisions’ sham negotiations caused Downhole Technology to delay
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filing suit in Harris County. (Exhibit A at ¶12). Absent Curry and Repeat Precision’s deception,
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Downhole Technology would have been the first to file, and it would have filed suit in Harris
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County in accordance with the forum and venue provision in the Agreement. (Id.) Their
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conduct prejudiced Downhole Technology by causing it to delay filing its lawsuit in Harris
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County, and resulted in Curry and Repeat Precision being the first to file suit. (Id.) But for their
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deception, Downhole Technology would have filed suit before the Burnet County Lawsuit was
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filed. (Id.)
40793289.3 7
D. This Lawsuit
The day after it discovered the Burnet County lawsuit, Downhole Technology filed its
Original Petition in this lawsuit, asserting claims relating to the Employment Agreement in the
venue Curry had agreed to—Harris County (the “Harris County Lawsuit”). The parties in the
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Harris County Lawsuit entered into an agreed Temporary Restraining Order (Exhibit D) and
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conducted expedited discovery concerning Curry’s breach of the Employment Agreement in
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preparation for a Temporary Injunction hearing.
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In its initial suit, Downhole Technology filed claims for both injunctive relief and money
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damages against Curry, Repeat Precision, Martin, and RJ. However, after discovery Downhole
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Technology amended its claims to seek primarily injunctive relief against Curry and Repeat
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Precision, and it filed a non-suit as to Martin and RJ.
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III. ABATEMENT IS NOT PROPER HERE
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The concept of abatement because of dominant venue is based on the principal that when
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a plaintiff files a lawsuit, cases involving the same subject matter should generally be brought in
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the same suit to conserve judicial resources, avoid delay, promote “comity, convenience, and the
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necessity for an orderly procedure in the trial of contested issues,” and because it is “impossible
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that two courts can, at the same time, possess the power to make a final determination of the
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same controversy between the same parties.” Perry v. Del Rio, 66 S.W.3d 239, 252 (Tex. 2001).
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However, this general rule does not apply when its justifications fail. Id. at 252. For
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example, dominant venue does not apply when the first-filed court cannot adjudicate the full
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matter at issue, or when conferring dominant jurisdiction on the first-filed court “will delay or
even prevent a prompt and full adjudication...” Id. The first-filed rule also does not apply “when
the race to the courthouse was unfairly run.” Id. In addition, dominant jurisdiction does not
40793289.3 8
exist where the moving party does not prove that its suit was first-filed in a county of proper
venue. See Gonzalez v. Reliant Energy, Inc., 159 S.W.3d 615, 622 (Tex. 2005) (dominant
jurisdiction only exists “if venue is proper in the county in which the suit was first filed. […]
Hidalgo County, however, was not a proper forum for Gonzalez’s wrongful death suit, and the
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Hidalgo statutory probate court therefore could not have acquired dominant jurisdiction over the
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suit even though it was first filed there.”); Gordon v. Jones, 196 S.W.3d 376, 382 (“Dominant
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jurisdiction applies when venue is proper in two or more Texas counties or courts.”).
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Defendants’ Motion to abate must fail for any one of these reasons.
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First, conferring jurisdiction on the Burnet County court will not adjudicate the full
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matter at issue because the mandatory venue statute governing suits for injunctive relief requires
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that this case be heard in Harris County.
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Second, Defendants cannot rely on the theory of dominant jurisdiction here because the
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race to the courthouse was unfairly run. Defendants used trickery and false pretenses to prevent
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Downhole Technology from filing suit.
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Third, dominant jurisdiction does not exist where the moving party does not prove that its
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suit was first filed in a county of proper venue. Here, Defendants have not and cannot show that
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venue is proper in the Burnet County Lawsuit.
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Fourth, Curry agreed that Harris County was the appropriate forum and waived the right
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to challenge venue in Harris County in the Employment Agreement.
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A. The mandatory venue rules require that this case be brought in Harris County, and
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Defendants have failed to show that venue in Burnet County would even be proper.
The Burnet County court cannot adjudicate this matter, and thus abatement is improper.
See Perry, 66 S.W.3d at 252. Suits that primarily seek injunctive relief “shall be tried” in the
county in which one of the defendants is “domiciled.” Tex. Civ. Prac. & Rem. Code § 65.023; In
40793289.3 9
re FPWP GP LLC, 2017 WL 461355 (Tex. App.—Dallas 2017, no pet.) (where primary purpose
of suit was injunctive relief, mandatory provision in Section 65.023 applied). This is a
mandatory venue statute. Id. at *6.
The “domicile” of a business for venue purposes is either (1) where its registered agent is
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located or (2) where its principal place of business is located. Ward v. Fairway Operating Co.,
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364 S.W.2d 194, 195-96 (Tex. 1963); Sudderth v. Grosshans, 581 S.W.2d 215 (Tex. App.—
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Austin 1979, no writ) (“Under the basic venue rule, the residence of a domestic corporation is the
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county where its registered office is located.”); Calborn Corp. v. Waxahachie Ind. School Dist.,
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540 S.W.2d 544 (Tex. App.—Waco 1976, no writ) (The place of a corporation's designated
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registered office and agent is the domicile of such corporation, although it might not be its
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principal place of business.); Vines v. Harry Newton, Inc., 445 S.W.2d 260 (Tex. App.—Houston
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[1st Dist.] 1969, writ dism'd) (“the county in which the registered office of the corporation is
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located is a statutory place of residence of the corporation” as is “the county in which a
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corporation maintains its principal office…”).
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In this case, Downhole Technology primarily seeks injunctive relief in the form of
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reformation of the non-competition agreement, enjoining Curry from violating it, and enjoining
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Repeat Precision from employing Curry in a manner that violates the agreement, among other
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injunctive relief. Therefore, Section 65.023 provides the mandatory venue in this case.
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Repeat Precision has designated Houston as the location of it registered agent (Exhibit A-
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8), and thus itis “domiciled” in Texas for purposes of venue. Ward v, 364 S.W.2d at 195-96.
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Venue is thus appropriate in Harris County. Tex. Civ. Prac. & Rem. Code § 65.023. Repeat
Precision does not have a registered agent in Burnet County.
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Venue is also appropriate in Harris County under Section 65.023 because Repeat
Precision’s principal office is located there. The principal office is the place “in which the
decision makers for the organization within this state conduct the daily affairs of the
organization.” Tex. Civ. Prac. & Rem. Code § 15.001(a). According to Repeat Precision’s own
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LinkedIn Profile, its “Headquarters” is located in “Houston.” (Exhibit A-7). The address that is
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typically given for Repeat Technology is its address on Willowbrook in Houston. (Exhibit A at
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¶13; Exhibit A-6; Deposition of W. Grant Martin, attached as Exhibit E, at 10:4-9). Curry admits
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that he never traveled to Marble Falls, though he did travel to Houston several times while
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working for Repeat Precision. (Deposition of Adam Curry, attached as Exhibit F, at 67:6-10). In
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addition, Repeat Precisions’ decision maker—by its own admission—is Robert Nipper, as he is
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the “President and Manager of
Preview
8/16/2018 4:11 PM Chris Daniel - District Clerk Harris County Envelope No. 26823464 By: Bristalyn Daniels Filed: 8/16/2018 4:11 PM CAUSE NO. 2018-47783 DOWNHOLE TECHNOLOGY, LLC, § IN THE DISTRICT COURT § Plaintiff, § § § k vs. § ler § HARRIS COUNTY, TEXAS § tC § ric REPEAT PRECISION, LLC AND ADAM § CURRY, § ist § 164TH JUDICIAL DISTRICT sD Defendants. § es DOWNHOLE TECHNOLOGY, LLC’S RESPONSE rg TO DEFENDANTS’ PLEA IN ABATEMENT Bu Defendant Downhole Technology, LLC (“Downhole Technology”) files this response to n ily the Plea in Abatement filed by Defendants Repeat Precision, LLC (“Repeat Precision”), R.J. ar M Machine Company, Inc. (“RJ”), W. Grant Martin (“Martin”) and Adam Curry (“Curry) of (collectively, Defendants).1 e ffic I. INTRODUCTION O Defendants—not Downhole Technology—have “forum shopped” in this case. This case y op concerns Curry’s breach of the non-compete and nondisclosure provisions of the employment C agreement that he entered into as a salesperson for Downhole Technology. Curry’s employment ial fic agreement made clear that Harris County was the only appropriate forum and venue for disputes of concerning Curry’s employment or the agreement. Indeed, Defendants do not contend that Un venue is improper in Harris County, but rather that it filed first and thus acquired dominant jurisdiction. 1 Since the Plea in Abatement was filed, Downhole Technology has filed a non-suit as to Martin and RJ. 40793289.3 When Curry breached the agreement to work for a competitor (Repeat Precision), Downhole Technology sent a demand letter attaching a pleading it planned to file imminently in Harris County. Curry and Repeat Precision asked Downhole Technology’s attorneys to stand down so that the parties could negotiate a resolution. k ler Instead, however, Curry and Repeat Precision pretended to negotiate while assembling tC and filing an action in Burnet County—an improper venue. In the Burnet County lawsuit, Curry ric and Repeat Precision make only one claim: a request for declaratory judgment that the non- ist sD compete is invalid, based on a purported lack of confidential information supporting the non- es compete.2 None of the parties to the case are located in Burnet County. None of the events rg giving rise to the claim occurred in Burnet County. And the agreement expressly names Harris Bu County, Texas as the sole forum and venue and expressly waives the right to challenge venue in n ily the clearly appropriate forum of Harris County. ar M Downhole Technology—the true plaintiff in this case—learned of the Burnet County of lawsuit on July 17 and filed its Harris County lawsuit on July 18. e ffic The Plea in Abatement should be denied for four reasons. First, the mandatory venue O statute governing suits for injunctive relief requires that this case be heard in Harris County. y op Tex. Civ. Prac. & Rem. Code § 65.023. Common law dominant jurisdiction based on the first C filed action does not overcome statutory mandatory venue. This case must be heard in Harris ial fic County. of Second, Defendants cannot rely on the theory of dominant jurisdiction because their Un inequitable conduct—pretending to be discussing a settlement agreement while preparing a lawsuit—prevented Downhole Technology from being the first to file. Texas courts do not allow 2 Adam Curry has already testified that Downhole Technology possessed confidential information and he had access to it – thus already gutting the substantive allegations of his Burnet County lawsuit. 40793289.3 2 parties to use such underhanded schemes to win a race to the courthouse. Hiles v. Arnie & Co., P.C., 402 S.W.3d 820 (Tex. App.—Houston [14th Dist.] 2013, pet. denied). Third, dominant jurisdiction does not exist where the moving party does not prove that its suit was first-filed in a county of proper venue. See Gonzalez v. Reliant Energy, Inc., 159 k ler S.W.3d 615, 622 (Tex. 2005). Tellingly, the Movants do not even attempt to prove (1) that tC venue in this case would be proper in Burnet County or (2) that venue in the Burnet County case ric is proper. It would be risky indeed for counsel to represent to this Court that venue is proper in ist sD Burnet County because even in the case pending there, venue is based on manufactured facts that es are already proven false by Defendants’ own deposition testimony. Downhole Technology has rg already filed a motion to transfer venue in that case setting out why venue is not proper in that Bu Court.3 Burnet County is an improper venue, and therefore dominant jurisdiction does not apply. n ily The Plea in Abatement should be denied. ar M Fourth, Curry agreed in his Employment Agreement to litigate disputes in Harris of County—a proper venue—and expressly waived the right to challenge that proper venue. A e ffic choice of venue clause that identifies a proper venue is enforceable. O Finally, despite the venue dispute, this Court still has jurisdiction over this suit and y op should grant Downhole Technology’s requested temporary injunction notwithstanding the C pending venue dispute. Dodd v. Evergreen National Construction, LLC, 2017 WL 2645041 at ial fic *3 (Tex. App.—Houston [1st Dist.] 2017, no pet.) (holding that plea to jurisdiction based on of dominant jurisdiction did not deprive the court of jurisdiction to rule on temporary injunction, Un and did not make the temporary injunction order defective). Indeed, it is telling that Defendants 3 A true and correct copy of the Motion to Abate, or in the Alternative, Motion to Transfer Venue, is attached as Exhibit I and incorporated by reference. 40793289.3 3 have not set their Motion to Transfer Venue4 for hearing—indicating that the plea in abatement is simply being used in an attempt to stall the ruling on the temporary injunction, rather than pursuing a ruling on the proper venue. II. FACTUAL BACKGROUND k ler A. Curry’s Agreement and Breach of the Agreement tC Founded in 2010, Downhole Technology is a leading provider of high quality, high- ric performance composite frac plugs for the hydraulic fracturing industry. Curry worked for ist sD Downhole Technology as a Frac Plug Advisor for the Northeast Region of the United States, es managing customer accounts in that region by conducting field support and making sales calls to rg customers and potential customers of Downhole Technology. Downhole Technology provided Bu Curry with access to its trade secrets and other commercially sensitive business information n ily related to its sales and marketing strategies, products, and customers’ needs and preferences, ar M among other things, to allow Curry to carry out his duties. of In exchange, Curry executed the Employment Agreement (attached as Exhibit A-1 and e ffic referred to as the “Agreement”) which contained provisions, including a non-competition O provision and non-disclosure provision, to protect Downhole Technology’s confidential and y op trade secret information. C The Agreement was negotiated by Downhole Technology at its principal place of ial fic business in Houston, Harris County, Texas, while Curry resided in and worked in Pennsylvania. of (See Affidavit of Jessica Small, attached as Exhibit A at ¶2). No party to the Agreement resided Un in Burnet County. (Exhibit A at ¶2). Curry never did any work for Downhole Technology in 4 The Defendants’ Plea in Abatement may not be used as a motion to transfer venue. In order to obtain a transfer of venue, Defendants must comply with Rule 87 of the Texas Rules of Civil Procedure, which requires at least 45 days notice of a hearing on the motion to transfer.Geochem Tech Corp. v. Verseckes, 962 S.W.2d 541, 543 (Tex. 1998) (“We no longer have a “plea of privilege” under our venue statutes and rules. Instead, a party seeking to transfer must file a motion objecting to venue. See Tex. R. Civ. P. 86.”) 40793289.3 4 Burnet County. (Id.) Nothing relating to the negotiation of the Agreement or Curry’s work under the Agreement occurred in Burnet County. (Id.) Curry abruptly quit his employment with Downhole Technology, and Downhole Technology later learned that Curry was working for one of Downhole Technology’s direct k ler competitors in the composite frac plug industry, Repeat Precision, as a District and Sales tC Manager. Downhole also learned that Repeat Precision hired Curry to develop the same ric region—and solicit the same customers—that he had called on for Downhole, and that Repeat ist sD Precision had not previously had any sales in that region. es B. Curry and Repeat Precision Feign Settlement Negotiations rg On June 13, 2018, counsel for Downhole Technology sent Curry a letter demanding that Bu he comply with the Agreement. (Exhibit A-2). The demand letter required a response by 5:00 n ily pm CST on June 14, 2018, and noted that if Curry ignored Downhole Technology’s demands, it ar M “will file the attached lawsuit requesting temporary and permanent injunctive relief designed to of curtail your unlawful competition…” (Id.) The demand letter attached the pleading that e ffic Downhole Technology intended to file if Curry did not respond by June 14, 2018. (Id.) That O same day, Downhole Technology’s counsel provided a copy of the Demand Letter to Repeat y op Precision. C On June 14, 2018, Jim Cleary (“Cleary”), on behalf of Curry and Repeat Precision, ial fic contacted Downhole Technology’s counsel, asking that they discuss the matter. (Exhibit A-3). of Cleary, on behalf of Curry and Repeat Precision, indicated a desire that the parties attempt to Un negotiate a settlement without counsel involved in the negotiations. On June 18, Cleary sent Downhole Technology’s counsel an email proposing a resolution: I wanted to assure you that Mr. Curry has not used, and has no intention of using Downhole Technologies' confidential information or property. While we disagree 40793289.3 5 that the list of customers contained in your letter is an accurate depiction of his customers or prospects for your client, he will not solicit his former customers or prospective customers for the time being. The management of Repeat would be open to discussing a list of off-limit clients for the restricted period. Can we connect the Downhole Technology management team for a business person discussion? (Id.) Counsel for Downhole Technology agreed to allow the proposed negotiation between k ler business management and began proposing dates for the meeting. (Id.) tC Robert Nipper, Repeat Technology’s President and Manager (See Repeat Precision’s ric ist Answers and Objections to Plaintiffs Expedited First Set of Interrogatories, attached as Exhibit sD B, at Interrogatory No. 6; Exhibit A-8), advised Ismail Nawaz, Downhole Technology’s es President, that he was in charge of negotiations on behalf of Repeat Technology. (Exhibit A at rg ¶7). Nipper offices in Harris County. Bu (Exhibit E at 53:13-17; Exhibit A-8). n On June 28, 2018, the parties agreed to meet in Houston (Exhibit A-4) and met there on ily ar July 9, 2018, to continue settlement discussions, including working on the list of customers that M would be restricted. (Exhibit A at ¶7). of e On July 11, 2018, Grant Martin (“Martin”), on behalf of Repeat Precision, emailed ffic Downhole Technology a “list [of customers] that we would be willing to agree to.” (Exhibit A- yO 5). That same day, when Ismail Nawaz (“Nawaz”), on behalf of Downhole, indicated that the op list was not acceptable. Robert Nipper (“Nipper”), on behalf of Repeat Precision, stated in an C ial email that Martin would contact him but was traveling, and said, “Thanks for bearing with us”— fic indicating that the parties were still working on a settlement agreement. (Id.) Downhole later of Un learned that this was just a ruse so that Curry and Repeat Precision could win a race to the courthouse before Downhole even knew there was a race to be run. Curry and Repeat Precision surreptitiously filed a lawsuit in Burnet County (the “Burnet County Lawsuit”) on July 12, 2018, the day after sending this email. The Burnet County Lawsuit solely requests that the court enter 40793289.3 6 declaratory judgment that the non-compete provision is unenforceable. (A true and correct copy of the current petition in the lawsuit is attached as Exhibit C.) Curry and Repeat Precision did not serve or notify Downhole Technology of the Burnet County lawsuit, but rather continued the charade of settlement. On July 17, 2018, Nawaz sent k ler Nipper a proposed list so that he could “pass it through our legal to formulate an official tC understanding,” and stated that if it was not acceptable, “then [Downhole] will ask legal to ric proceed with their original proposed action plan”—that is, file a lawsuit. (Exhibit A-5). Nipper ist sD responded by asking for a call, indicating his desire to continue settlement negotiations. (Id.) es C. The Burnet County Lawsuit rg Despite Curry and Repeat Precision’s continuing indications that the parties were Bu completing settlement negotiations, on July 18, 2018, Downhole Technology learned that Curry n ily and Repeat Precision had filed suit in Burnet County solely asking that the Court declare that the ar M non-compete is invalid. (Exhibit C). of Curry and Repeat Precisions’ sham negotiations caused Downhole Technology to delay e ffic filing suit in Harris County. (Exhibit A at ¶12). Absent Curry and Repeat Precision’s deception, O Downhole Technology would have been the first to file, and it would have filed suit in Harris y op County in accordance with the forum and venue provision in the Agreement. (Id.) Their C conduct prejudiced Downhole Technology by causing it to delay filing its lawsuit in Harris ial fic County, and resulted in Curry and Repeat Precision being the first to file suit. (Id.) But for their of deception, Downhole Technology would have filed suit before the Burnet County Lawsuit was Un filed. (Id.) 40793289.3 7 D. This Lawsuit The day after it discovered the Burnet County lawsuit, Downhole Technology filed its Original Petition in this lawsuit, asserting claims relating to the Employment Agreement in the venue Curry had agreed to—Harris County (the “Harris County Lawsuit”). The parties in the k ler Harris County Lawsuit entered into an agreed Temporary Restraining Order (Exhibit D) and tC conducted expedited discovery concerning Curry’s breach of the Employment Agreement in ric preparation for a Temporary Injunction hearing. ist sD In its initial suit, Downhole Technology filed claims for both injunctive relief and money es damages against Curry, Repeat Precision, Martin, and RJ. However, after discovery Downhole rg Technology amended its claims to seek primarily injunctive relief against Curry and Repeat Bu Precision, and it filed a non-suit as to Martin and RJ. n ily III. ABATEMENT IS NOT PROPER HERE ar M The concept of abatement because of dominant venue is based on the principal that when of a plaintiff files a lawsuit, cases involving the same subject matter should generally be brought in e ffic the same suit to conserve judicial resources, avoid delay, promote “comity, convenience, and the O necessity for an orderly procedure in the trial of contested issues,” and because it is “impossible y op that two courts can, at the same time, possess the power to make a final determination of the C same controversy between the same parties.” Perry v. Del Rio, 66 S.W.3d 239, 252 (Tex. 2001). ial fic However, this general rule does not apply when its justifications fail. Id. at 252. For of example, dominant venue does not apply when the first-filed court cannot adjudicate the full Un matter at issue, or when conferring dominant jurisdiction on the first-filed court “will delay or even prevent a prompt and full adjudication...” Id. The first-filed rule also does not apply “when the race to the courthouse was unfairly run.” Id. In addition, dominant jurisdiction does not 40793289.3 8 exist where the moving party does not prove that its suit was first-filed in a county of proper venue. See Gonzalez v. Reliant Energy, Inc., 159 S.W.3d 615, 622 (Tex. 2005) (dominant jurisdiction only exists “if venue is proper in the county in which the suit was first filed. […] Hidalgo County, however, was not a proper forum for Gonzalez’s wrongful death suit, and the k ler Hidalgo statutory probate court therefore could not have acquired dominant jurisdiction over the tC suit even though it was first filed there.”); Gordon v. Jones, 196 S.W.3d 376, 382 (“Dominant ric jurisdiction applies when venue is proper in two or more Texas counties or courts.”). ist sD Defendants’ Motion to abate must fail for any one of these reasons. es First, conferring jurisdiction on the Burnet County court will not adjudicate the full rg matter at issue because the mandatory venue statute governing suits for injunctive relief requires Bu that this case be heard in Harris County. n ily Second, Defendants cannot rely on the theory of dominant jurisdiction here because the ar M race to the courthouse was unfairly run. Defendants used trickery and false pretenses to prevent of Downhole Technology from filing suit. e ffic Third, dominant jurisdiction does not exist where the moving party does not prove that its O suit was first filed in a county of proper venue. Here, Defendants have not and cannot show that y op venue is proper in the Burnet County Lawsuit. C Fourth, Curry agreed that Harris County was the appropriate forum and waived the right ial fic to challenge venue in Harris County in the Employment Agreement. of A. The mandatory venue rules require that this case be brought in Harris County, and Un Defendants have failed to show that venue in Burnet County would even be proper. The Burnet County court cannot adjudicate this matter, and thus abatement is improper. See Perry, 66 S.W.3d at 252. Suits that primarily seek injunctive relief “shall be tried” in the county in which one of the defendants is “domiciled.” Tex. Civ. Prac. & Rem. Code § 65.023; In 40793289.3 9 re FPWP GP LLC, 2017 WL 461355 (Tex. App.—Dallas 2017, no pet.) (where primary purpose of suit was injunctive relief, mandatory provision in Section 65.023 applied). This is a mandatory venue statute. Id. at *6. The “domicile” of a business for venue purposes is either (1) where its registered agent is k ler located or (2) where its principal place of business is located. Ward v. Fairway Operating Co., tC 364 S.W.2d 194, 195-96 (Tex. 1963); Sudderth v. Grosshans, 581 S.W.2d 215 (Tex. App.— ric Austin 1979, no writ) (“Under the basic venue rule, the residence of a domestic corporation is the ist sD county where its registered office is located.”); Calborn Corp. v. Waxahachie Ind. School Dist., es 540 S.W.2d 544 (Tex. App.—Waco 1976, no writ) (The place of a corporation's designated rg registered office and agent is the domicile of such corporation, although it might not be its Bu principal place of business.); Vines v. Harry Newton, Inc., 445 S.W.2d 260 (Tex. App.—Houston n ily [1st Dist.] 1969, writ dism'd) (“the county in which the registered office of the corporation is ar M located is a statutory place of residence of the corporation” as is “the county in which a of corporation maintains its principal office…”). e ffic In this case, Downhole Technology primarily seeks injunctive relief in the form of O reformation of the non-competition agreement, enjoining Curry from violating it, and enjoining y op Repeat Precision from employing Curry in a manner that violates the agreement, among other C injunctive relief. Therefore, Section 65.023 provides the mandatory venue in this case. ial fic Repeat Precision has designated Houston as the location of it registered agent (Exhibit A- of 8), and thus itis “domiciled” in Texas for purposes of venue. Ward v, 364 S.W.2d at 195-96. Un Venue is thus appropriate in Harris County. Tex. Civ. Prac. & Rem. Code § 65.023. Repeat Precision does not have a registered agent in Burnet County. 40793289.3 10 Venue is also appropriate in Harris County under Section 65.023 because Repeat Precision’s principal office is located there. The principal office is the place “in which the decision makers for the organization within this state conduct the daily affairs of the organization.” Tex. Civ. Prac. & Rem. Code § 15.001(a). According to Repeat Precision’s own k ler LinkedIn Profile, its “Headquarters” is located in “Houston.” (Exhibit A-7). The address that is tC typically given for Repeat Technology is its address on Willowbrook in Houston. (Exhibit A at ric ¶13; Exhibit A-6; Deposition of W. Grant Martin, attached as Exhibit E, at 10:4-9). Curry admits ist sD that he never traveled to Marble Falls, though he did travel to Houston several times while es working for Repeat Precision. (Deposition of Adam Curry, attached as Exhibit F, at 67:6-10). In rg addition, Repeat Precisions’ decision maker—by its own admission—is Robert Nipper, as he is Bu the “President and Manager of