The dilemma as to which court, federal or local, is the most appropriate venue for Law 75 or Law 21 cases continues in 2009.
In Interamerican Builders Agencies Co. v. Sta-Rite Industries, Inc., 602 F. Supp. 306 (D.P.R. Feb. 19, 2009), plaintiff, an exclusive distributor of industrial equipment, sued both the principal under Law 75 and the appointed distributors for tortious interference. After removal to federal court, the court allowed plaintiff’s motion to remand reasoning that, although the diversity defeating distributors were dispensable parties, plaintiff would be prejudiced by litigating in two different forums and the federal court has no significant interest in deciding issues of Law 75.Thus, the court remanded the case to local court to promote the efficient use of judicial resources.
Going the other way is Renaissance Marketing, Inc. v. Monitronics International, Inc., 606 F. Supp. 2d 201 (D.P.R. March 31, 2009). There, the court held that diversity-defeating Puerto Rico distributors were fraudulently joined as defendants to defeat removal jurisdiction. Plaintiff, an alleged exclusive distributor of alarm equipment services, joined the newly-appointed distributors as parties in the federal case despite the fact that a prior lawsuit for tortious interference against them had been filed in the local court. However, the federal complaint for declaratory judgment and breach of contract under Law 21 or Law 75 was directed solely against the principal. “Courts cannot allow a party to litigate simultaneously against the same defendants, in different suits, arising from the same facts.” The court then granted defendant’s motion to dismiss holding that a Texas forum selection clause was enforceable despite the strong public policy in Puerto Rico behind Laws 75 and 21.
