Freese & Goss PLLC et al v. Sheila M Bossier et al
ORDER accepting 16 Findings and Recommendation of the United States Magistrate Judge. The court denies Defendants' 4 Motion to Dismiss/Abstain; denies Defendants' Motion to Transfer Venue; and denies as moot Plaintiffs' 14 Motion for Leave to File Sur-Reply to Defendants' Motion to Dismiss/Abstain or in the Alternative, Motion to Transfer Venue. (Ordered by Judge Sam A Lindsay on 8/18/2017) (axm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FREESE & GOSS, PLLC, RICHARD A.
FREESEE, and TIM K. GOSS,
SHEILA M. BOSSIER and BOSSIER &
Civil Action No. 3:17-CV-360-L
Before the court are Defendants’ Motion to Dismiss/Abstain or in the Alternative, Motion
to Transfer Venue (Doc. 4), filed February 2, 2017; and Plaintiffs’ Motion for Leave to File SurReply to Defendants’ Motion to Dismiss/Abstain or in the Alternative, Motion to Transfer Venue
(Doc. 14), filed March 20, 2017. On May 23, 2017, United States Magistrate Judge David L.
Horan entered the Findings, Conclusions, and Recommendation of the United States Magistrate
Judge (“Report”), recommending that Defendant’s Motion to Dismiss/Abstain or in the
Alternative, Motion to Transfer Venue be denied; and Plaintiffs’ Motion for Leave to File SurReply to Defendants’ Motion to Dismiss/Abstain or in the Alternative, Motion to Transfer Venue
Defendants state that “given the [Report] and United States District Judge Daniel P.
Jordan’s ruling transferring the parallel proceeding from the Southern District of Mississippi to
the Northern District of Texas, Dallas Division, they are swimming upstream insofar as they seek
de novo relief.” Defendants, however, proceed to make two objections.
Order – Page 1
First, Defendants object to the Report’s finding that Plaintiffs’ claims are appropriate for
declaratory relief, as they contend that the magistrate judge did not properly acknowledge the
scope of Plaintiffs’ Declaratory Judgment Action. Defendants contend that the Report fails to
adequately consider that Plaintiffs have raised Mississippi-based claims and that Plaintiffs’
declaratory judgment action impermissibly seeks rulings concerning non-liability for past conduct.
The court has carefully reviewed Defendants’ first objection and determines that this argument
was not raised by Defendants in their motion, brief, or reply related to their Motion to
Dismiss/Abstain or in the Alternative, Motion to Transfer Venue. “[A] party who objects to the
magistrate judge’s report waives legal arguments not made in the first instance before the
magistrate judge.” Freeman v. County of Bexar, 142 F.3d 848, 851 (5th Cir. 1998) (citing Cupit v.
Whitley, 28 F.3d 532, 535 (5th Cir. 1994)). Accordingly, Plaintiffs’ response correctly points out
that filing objections does not entitle Defendants to present new arguments that were not included
in Defendants’ brief or reply related to their Motion to Dismiss/Abstain or in the Alternative,
Motion to Transfer Venue. The court, therefore, determines that Defendants’ legal argument raised
for the first time in their objection has been waived, and the objection will be overruled.
Second, Defendants object to the Report’s finding that the Trejo Factors 1 do not favor
dismissal of this action. Defendants object to the federalism, fairness, and efficiency factors
In St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590-91 (5th Cir. 1994), the court identified the following seven
nonexclusive factors to consider in deciding whether to abstain from adjudicating a declaratory judgment action:
1) whether there is a pending state action in which all of the matters in controversy may be fully
litigated, 2) whether the plaintiff filed suit in anticipation of a lawsuit filed by the defendant, 3)
whether the plaintiff engaged in forum shopping in bringing the suit, 4) whether possible inequities
in allowing the declaratory plaintiff to gain precedence in time or to change forums exist, 5)
whether the federal court is a convenient forum for the parties and witnesses, . . . 6) whether
retaining the lawsuit in federal court would serve the purposes of judicial economy, and . . . [7)]
whether the federal court is being called on to construe a state judicial decree involving the same
parties and entered by the court before whom the parallel state suit between the same parties is
(footnote and citation omitted). These seven factors are nonexclusive. Sherwin-Williams Co. v. Holmes Cty., 343
F.3d 383, 388 (5th Cir. 2003).
Order – Page 2
discussed on pages 7-16 of the Report. Defendants contend that the Report incorrectly determines
that the presuit action 2 and Plaintiffs’ complaint are similar, as the presuit action related to a narrow
accounting and compensation dispute; whereas the complaint filed by Plaintiffs is more complex
and related to actions that occurred in Mississippi. Plaintiffs counter that the Report did consider
Defendants’ argument that this action arose from acts that occurred in Mississippi; however, the
Report determined that the witnesses and documents are overwhelmingly in Dallas, Texas.
Additionally, Defendants contend that the Report should have considered Defendants’ cross-claim
in Mississippi state court in its analysis of the Trejo federalism factor. Plaintiffs counter that there
is a recommendation by the Special Master in Mitchell v. Freese & Goss, PLLC, et al., to allow
Defendants to file a cross-claim; however, there is not an order to allow Defendants to file a crossclaim. Further, Plaintiffs contend that Defendants were dismissed with prejudice from the Mitchell
case on June 8, 2017.
The court has conducted an independent review of the magistrate judge’s discussion on
pages 9-18 of the Report. The court determines that federalism, fairness, and efficiency factors do
not favor dismissal of this action. Further, after review, the court agrees with the conclusion that
the Trejo factors as a whole do not support dismissal. Moreover, insofar as Defendants’ crossclaim argument relates to federalism, the court does not find merit in the argument because the
cross-claim has not yet been filed, and Defendants have been dismissed with prejudice from the
Mitchell case. Finally, the parallel proceeding that Defendants filed in the Southern District of
Mississippi has now been transferred to the Northern District of Texas. Accordingly, the court
The court notes that on October 26, 2016, Defendants filed a petition for presuit discovery in a Texas state court.
The petition stated that Texas was the proper venue for the anticipated suit in Dallas County because a substantial
portion of the acts or omissions occurred in Texas.
Order – Page 3
determines that the Report correctly weighed and applied the Trejo factors, and Defendants’
objection will be overruled.
Having reviewed the motion, record, Report, applicable law, and conducting a de novo
review of Defendants’ objections, the court determines that the findings and conclusions of the
magistrate judge are correct, and accepts them as those of the court. Accordingly, the court denies
Defendants’ Motion to Dismiss/Abstain; denies Defendants’ Motion to Transfer Venue; and
denies as moot Plaintiffs’ Motion for Leave to File Sur-Reply to Defendants’ Motion to
Dismiss/Abstain or in the Alternative, Motion to Transfer Venue.
It is so ordered this 18th day of August, 2017.
Sam A. Lindsay
United States District Judge
Order – Page 4
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