Broker-Dealer Litigation - Greenberg Traurig LLP

permit exercise of personal jurisdiction. The company was not a resident of the state, had no
office there, did not regularly conduct business there, and had no accounts or assets in the state.
Likewise, the individual defendants had never been North Carolina residents and had no assets in
the state. Their contacts with the forum were limited to correspondence, a few business
meetings, and trips to the state unrelated to the subject matter of the suit. The court found that
the plaintiffs had failed to make out a prima facie case of general personal jurisdiction, and their
proposed discovery would not alter the analysis of the issue.
Nexbank, SSB v. BAC Home Loan Servicing, LP, 2011 WL 5182118 (N.D. Tex. Oct. 28, 2011).
Plaintiff filed suit against the defendants in Texas state court asserting claims under state
common and statutory law and federal securities law arising out of the plaintiff’s purchase of
three mortgage-backed securities from the defendants. The defendants removed the case to
federal court based on both federal question and diversity jurisdiction. The plaintiff moved to
remand and the court granted the motion, concluding that the claim under the Securities Act of
1933 was not removable under 15 U.S.C. § 77v(a), and the claims under the Securities
Exchange Act of 1934 were not separate and independent, and therefore the court lacked subject
matter jurisdiction. Back in state court, the defendants moved for partial summary judgment as
to the Securities Act claim, which the state court granted. Thereafter, the defendants removed
the case to federal court a second time, and the plaintiff again moved to remand. The court
granted the motion, holding that the second removal violated the “voluntary-involuntary rule,”
which provides that a case that is not removable on the initial pleadings may only become
removable pursuant to a voluntary act of the plaintiff. Because the summary judgment on the
Securities Act claim granted by the state court, which erased the initial impediment to removal,
resulted from the defendants’ actions, not the plaintiff’s, the case remained non-removable and
remand was warranted.
KBR, Inc. v. Chevedden, 776 F. Supp. 2d 415 (S.D. Tex. 2011).
In a declaratory judgment action brought by a corporation seeking a declaration that it
could exclude a retail investor’s proposal in proxy materials for its annual shareholders meeting,
the defendant-investor moved to transfer venue from Houston to California. The court found
that the litigation arose out of letters the defendant sent to Houston asking for his proposal to be
included in the proxy materials, and therefore venue was proper in Houston. In denying the
motion to transfer, the court concluded that the defendant failed to show that a California venue
was clearly more convenient, as the case raised a legal issue that would be resolved on the papers
without the need for court appearances, rendering the parties’ relative financial burdens largely
irrelevant.
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