Texas Capital BankAfter being granted an extension to respond to the federal government’s request to change the venue of the trial between Banks Vs. Ginnie Maehas filed an objection to the request, saying a “forum selection clause” cited by government lawyers is unenforceable.
“Lost attempt to dismiss [TCB]”The government requests that this court transfer this case to another court,” TCB’s attorneys said in a court filing obtained by TCB. house lineReverse Mortgage Daily (RMD). “The government’s motion, based solely on the forum-selection provision in the pre-bankruptcy tail agreement, failed for at least three independent reasons.”
The first reason is that the forum selection clause cited by the government is part of the agreement signed between the banks. reverse mortgage financing (RMF), the bankrupt reverse mortgage lender at the center of the situation. Since the government is not a party to the agreement, its provisions (and by extension the forum selection clauses) cannot be enforced by the government itself.
“Courts generally hold that a non-signatory party may not enforce a forum selection clause if the contract expressly prohibits a third party from benefiting from or enforcing the contract,” the filing reads.
Second, even if the government was in some way a party to the agreement, the government has not sufficiently demonstrated that the circumstances of the case are rare and novel enough to actually allow it to attempt to enforce the agreement in accordance with its terms.
Finally, TCB lawyers said that while the forum selection clause was part of the tail agreement, the case itself was not specifically about that agreement. Instead, the document explains, this is “the government overstepping its legal authority and interfering with the plaintiffs’ property rights.” “The government’s motion should therefore be rejected.”
TCB went on to say that the contract prohibited third parties from enforcing forum selection provisions that the government sought to exploit.
“But despite spending a lot of time discussing […] “In the agreement, the government omitted key provisions that prevented the government from benefiting from or enforcing the forum selection provisions,” TCB lawyers said.
This provision is “[n]o Terms or regulations[e] The agreement should be in the interests of everyone [other] people,” and “No [other] A person…shall be entitled to rely in any manner upon…the Bank’s failure to perform, observe or comply with any such term or provision,” TCB’s lawyers cited the agreement itself.
The bank also argued that precedent from previous court cases worked in its favor and argued that the government had “no apparent awareness” of the forum-selection clause before making its request.
In its initial move to change venue, the government claimed that by signing a tail agreement with RMF, the bank agreed that “Dallas County, Texas, where TCB is headquartered, will be the ‘exclusive venue for any litigation involving any litigation involving the litigation.'” . [the tail agreement] or any loan documents,” according to the original documents requested to be migrated.
However, the case was filed in Amarillo court.
“TCB’s lawsuit involves[s]’Tail Agreement and Loan Documents […]. Therefore, TCB is obligated to litigate in Dallas County. TCB ignored that obligation and chose to file the lawsuit in Amarillo, which is unrelated to the lawsuit,” government attorneys said last month.
As of Tuesday evening, the chief magistrate’s decision had not yet been submitted to the court. Before the magistrate is another pending request from the bank for partial summary judgment in TCB’s favor, with a new deadline of August 1.
In a February court filing in response to the government’s initial motion to dismiss, TCB said it recognized Ginnie Mae’s authority to “eliminate RMF’s mortgage servicing rights.” But TCB’s lawyers said Ginnie Mae did not specify how that would affect the lien in which the bank has a vested interest.
“But a few months later, Ginnie Mae took the drastic step of canceling RMF’s servicing rights and purportedly also canceling TCB’s lien—a high-profile collateral grab without legal support and It goes against Ginnie Mae’s previous transactions, basic fairness and common interests with TCB.
