Intelligent Highway Solutions, Inc. (fka IHSI)

[john12341]

burn it was not ihsi that moved for the case against tca to be heard in Florida and not California it was tca. this gives us a idea of what is going on. the whole case was dismissed in Califonia. So the way i read this ihsi was not happy with this and refiled in Florida.

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Intelligent Highway Solutions vs. TCA Global Credit Master

2017-00219822-CU-FR

Intelligent Highway Solutions vs. TCA Global Credit Master

Nature of Proceeding: Motion to Stay or Dismiss Action

Filed By: Trotter, Chelsea N.

Defendant TCA Global Credit Master Fund’s (“TCA”) motion pursuant to Code of Civil Procedure §410.30 and §418.10 to stay or dismiss action on grounds of forum non conveniens and the parties’ mandatory forum selection clause is GRANTED, as follows.

Plaintiff’s opposition fails to comply with CRC Rule 3.1110(b)(3)-(4).

Factual Background

Plaintiff Intelligent Highway Solutions, Inc. (“IHSI”) filed this suit on 9/28/2017, claiming that TCA committed a variety of wrongful conduct in connection with several agreements which were intended to assist IHSI with expanding its business, including but not limited to financing for the acquisition of other assets. IHSI, a Nevada corporation with its principal place of business in Sacramento County, contends inter alia that TCA was not licensed or registered to lend money in California and on this and other bases now seeks to rescind and/or void the parties’ agreements. The complaint also seeks compensatory and punitive damages pursuant to causes of action for breach of contract and misrepresentation.

Moving Papers. TCA now moves to enforce the mandatory forum selection clauses contained in the various agreements executed by IHSI, each of which specifies not only that any action be brought in either state or federal court located in Broward County, Florida but also that IHSI “waives any objection based on forum non conveniens.” According to the moving papers, such a contractual forum selection clause is binding absent a showing that its enforcement would be unfair and unreasonable under the circumstances since parties are generally free to negotiate their own bargain. TCA adds that it is reasonable to require IHSI to prosecute its claims against TCA in Florida inasmuch as Broward County is TCA’s principal place of business and ISHI never objected to these forum selection clauses in each of the agreements despite being represented by counsel during negotiations.

Opposition. IHSI opposes, arguing first that this motion is “premature” since TCA has not yet been served with the complaint. The opposition next asserts that the forum selection and the choice of law provisions (the latter of which is not relevant to the present motion) are unenforceable because they violate California laws and public policy designed to protect California borrowers (even though IHSI is actually a Nevada corporation). More specifically, IHSI insists that TCA violated California finance lender laws by not holding the required California lender license at the time the subject loan was made to IHSI. The opposition further argues that TCA “purposefully availed” itself to California’s law and has “minimum contacts” here (even though TCA is not challenging whether it is subject to personal jurisdiction in California). IHSI also contends TCA has no substantial or reasonable relationship with either Florida (mandatory forum) or Nevada (choice of law) since TCA was formed in the Cayman Islands and has its principal place of business there, with a different TCA entity being based in Florida, thereby justifying a refusal to enforce the mandatory forum selection clause cited in the moving papers.

Reply. TCA initially points out it need not wait for service of summons to file a

responsive pleading and thus, the present motion is not “premature.” The reply next contends the enforcement of neither the forum selection nor the choice of law clause would violate California’s law or public policy given that contrary to IHSI’s allegation, TCA is exempt from California’s finance lender laws pursuant to the express provisions of Finance Code §22050(e) [“This division does not apply to any person who makes five or fewer loans in a 12-month period, these loans are commercial loans as defined in Section 22502, and the loans are incidental to the business of the person relying upon the exemption”] since TCA does not actively solicit any business in California and made less than five commercial loans to California borrowers both in the 12 months preceding the transaction with IHSI and in the calendar year of 2017. Moreover, TCA maintains there is nothing unfair or unreasonable about these terms since IHSI is a publicly traded company incorporated in Nevada which was in the subject transaction represented by counsel and since IHSI expressly consented to (1) exclusive jurisdiction in Florida, (2) the application of Nevada law and (3) the waiver of objections based on forum non conveniens, thereby undermining IHSI’s request to have the Court essentially re-write the agreements with TCA. To be sure, the reply highlights the fact that the numerous documents executed by the parties indicate TCA’s address of record is located in Las Vegas, Nevada so as to explain the application of Nevada law, while TCA’s “management company” is located in Broward County, Florida so as to justify the exclusive jurisdiction clause. For these reasons, TCA insists the current lawsuit by IHSI must be litigated in Florida.

Analysis

According to recent precedent, a trial court ruling on a forum non conveniens motion must address two specific issues: (1) whether a suitable alternative forum exists and

(2) whether the private and public factors weigh in favor of litigation in the alternative forum. (David v. Medtronic, Inc. (2015) 237 Cal.App.4th 734, 741 [citing Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744, 751].) The first part is actually a threshold inquiry which must be satisfied before the Court proceeds to the balancing test and “In order for an alternative forum to be suitable, there must be jurisdiction and no statute of limitations bar to hearing the case on the merits.” (David, at 742-743.) The second part of the test involves consideration of “private” factors (those which make trial and the enforceability of the ensuing judgment expeditious and relatively inexpensive, such as the ease of access to sources of proof, the cost of obtaining attendance of witnesses, and the availability of compulsory process for attendance of unwilling witnesses) and “public” factors (primarily the avoidance of overburdening local courts with congested calendars; protecting the interests of potential jurors so that they are not called upon to decide cases in which the local community has little concern; and weighing the competing interests of California and the alternate jurisdiction in the litigation).

IHSI’s opposition here does not appear to address at all the first part of the David standard as it nowhere asserts that Broward County, Florida would not be a suitable alternate forum for IHSI to pursue the causes of action alleged in the complaint or that any of the causes of action might be barred by the applicable statute of limitations. Instead, the opposition seems to focus primarily on the second part of the David test, primarily arguing that public policy weighs against the enforcement of the mandatory forum selection and choice of law provisions in the parties’ agreement (although the latter clause is not relevant to the present motion) but never specifically addressing the “private” factors relevant to the determination of whether this action is most appropriately litigated in Florida pursuant to the contractual language or in California.

Finding no merit in the opposition’s limited arguments, TCA’s motion will be granted.

At the outset, IHSI has cited and the Court is aware of no authority which precludes TCA from filing the present motion prior to service of the summons and complaint. Therefore, there is no proper legal basis for IHSI’s characterization of TCA’s motion as “premature.”

As pointed out above, the opposition nowhere asserts that Broward County, Florida would be an unsuitable alternate forum for IHSI to pursue its causes of action alleged in the complaint or any of these causes of action would be subject to a statute of limitations defense. As TCA has met its initial burden of showing the existence of a suitable alternate forum in which IHSI may pursue the claims against TCA, this Court now turns to determining whether the various “private” and “public” factors weigh in favor of litigation in California or Florida.

The “private” factors to be considered here are those which make trial and the enforceability of the ensuing judgment expeditious and relatively inexpensive, such as the ease of access to sources of proof, the cost of obtaining attendance of witnesses, and the availability of compulsory process for attendance of unwilling witnesses. Since IHSI’s opposition did not address any of these “private” factors, the Court concludes none of them actually weigh in favor of litigating this action in California and none weigh against litigating this action in Florida.

The remaining part of the two-part David test entails consideration of the “public” factors such as the avoidance of overburdening local courts with congested calendars; protecting the interests of potential jurors so that they are not called upon to decide cases in which the local community has little concern; and weighing the competing interests of California and the alternate jurisdiction in the litigation.

While IHSI alleges in both the complaint and the opposition that TCA violated California finance lender laws by not being licensed by this state at the time of the subject loan to IHSI, TCA has provided competent evidence which is sufficient to persuade this Court that TCA is pursuant to Finance Code §22050(e) exempt from California’s finance lender laws and license requirement since the Silverman Declaration in reply demonstrates TCA does not actively solicit business in California and also made fewer than five commercial loans to California borrowers both in the 12 months preceding the transaction with IHSI and in the calendar year of 2017. The mere fact that TCA may do business “throughout the world” and has also registered in order to be authorized to do business in California does not, without more, indicate TCA is subject to the finance lender laws of this state and to conclude otherwise would be to ignore the plain language of §22050(e)’s “safe harbor” provision. Because TCA has established it is more likely than not exempt from the application of California finance lender laws, the Court finds little “public” interest weighing in favor of holding TCA accountable in California for its alleged wrongdoing and this is especially true when IHSI is itself admittedly a Nevada corporation.

It is important to note here that the opposition’s suggestion about TCA “purposefully availing” itself to California’s law and having “minimum contacts” with California seems to conflate the separate and distinct legal standards for personal jurisdiction and for forum/venue. The terms “purposeful availment” and “minimum contacts” are relevant only where there is a challenge to a particular state’s exercise of personal jurisdiction over a non-resident defendant, an issue not implicated by the present motion which

simply relates to the availability of a more convenient (mandatory) forum (i.e., state) for this action.

The remaining element of IHSI’s argument regarding the “public” factors is that there is no legitimate justification for compelling this suit to take place in Florida or to be governed by Nevada law. This contention, however, does not withstand scrutiny. With respect to the choice of law provision (which is itself irrelevant to the disposition of this forum non conveniens motion), the parties’ agreement to utilize Nevada law seems eminently reasonable under the circumstances since IHSI is a Nevada corporation and since the parties’ agreement states that TCA’s address of record is also in Nevada. Regardless, TCA was certainly free to consent to the application of Nevada law for the purposes of the agreements with IHSI. Likewise, there is nothing unreasonable about the contract language specifying that any action be brought in Broward County, Florida given that TCA’ “management company” is based there and that IHSI was free to negotiate a different forum but failed to do so despite being represented by counsel at the time. As IHSI has advanced no valid basis on which the parties’ express forum selection clause may be overridden and both parties also explicitly waived objections based on forum non conveniens, this Court can find no legitimate justification for permitting IHSI to pursue the present action in California rather than in Florida.

Conclusion

In light of the foregoing, TCA’s motion based on forum non conveniens is granted and the complaint filed herein by IHSI is dismissed.

Pursuant to CRC Rule 3.1312, TCA to prepare a judgment of dismissal of the entire action.

source
http://lawzilla.com/blog/intelligent-highway-solutions-vs-tca-global-credit-master/