Abbasid, Incorporated v. Bank of America, N.A. , 463 F. App'x 317 ( 2012 )

Case: 11-40243 Document: 00511770908 Page: 1 Date Filed: 02/28/2012
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
February 28, 2012
No. 11-40243
Summary Calendar Lyle W. Cayce
Clerk
ABBASID, INC., Doing Business as Azhar’s Oriental Rugs,
Plaintiff-Appellant,
versus
BANK OF AMERICA, N.A.,
Defendant-Appellee.
Appeal from the United States District Court
for the Southern District of Texas
No. 7:08-CV-162
Before REAVLEY, SMITH, and PRADO, Circuit Judges.
PER CURIAM:*
Abbasid, Inc. (“Abbasid”), challenges a summary judgment in favor of
Bank of America, N.A. (“BoA”). We affirm.
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published
and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
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Abbasid sued BoA in state court, alleging various Texas state-law causes
of action arising from BoA’s alleged wrongful payment of checks drawn on Abba-
sid’s account. BoA removed to federal court, which denied Abbasid’s motion to
remand, finding that there was diversity jurisdiction. A year later, Abbasid
moved to compel arbitration, shortly after which BoA moved for summary judg-
ment. The district court denied Abbasid’s motion to compel arbitration and
stayed the case pending its appeal of the denial. After we affirmed, the district
court directed Abbasid to respond to the motion for summary judgment.
In support of its motion for summary judgment, BoA relied on the Texas
Uniform Commercial Code and provisions of private agreements between BoA
and Abbassid. Abbasid responded by, inter alia, claiming summary judgment
was improper because New Mexico law should be applied, requesting leave to
amend the complaint to assert New Mexico law. The court granted summary
judgment, ruling that because Abbassid “litigated its claims under Texas law for
well over two years before first raising the choice of law issue to defend against
summary judgment, . . . Plaintiff’s appeal to New Mexico law is both tardy and
suspect.” The court noted that New Mexico and Texas have adopted the same
relevant positions of the Uniform Commercial Code, and Abbasid had failed to
show how New Mexico statutory or caselaw is different from Texas’s or would
compel a different result. The court denied amendment as futile.
Abbassid contends the district court did not properly consider the merits
of its choice-of-law defense. We review a summary judgment de novo, applying
the same Federal Rule of Civil Procedure 56 standards that guided the district
court. Cotroneo v. Shaw Env’t & Infrastructure, Inc., 639 F.3d 186, 191 (5th Cir.
2011), petition for cert. filed, 80 U.S.L.W. 3058 (July 13, 2011) (No. 11-71).
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When sitting in diversity jurisdiction, federal courts apply the choice-of-
law rules of the forum state. Marchesani v. Pellerin-Milnor Corp., 269 F.3d 481,
485 (5th Cir. 2001). Accordingly, in this case, Texas choice of law rules apply.
Although parties are not required to plead choice-of-law issues at the outset of
a case, they must raise them “in time to be properly considered.” Kucel v. Walter
E. Heller & Co., 813 F.2d 67, 74 (5th Cir. 1987).
Abbasid sued in state court and, as the district court properly noted, tried
the case under Texas law for over two years, invoking Texas law in its discovery
requests, motion to compel arbitration, and briefing of its first appeal. Only in
response to BoA’s comprehensive motion for summary judgment, which relied
heavily on Texas law, did Abbasid first contend that New Mexico law applies.
Even assuming that Abbasid was timely and not attempting to avail itself of the
benefits of Texas law during discovery and pre-trial only to invoke New Mexico
law when substantive issues were to be considered, Abbasid’s bare invocation of
New Mexico law neither satisfies Texas’s choice-of-law rules nor meets the bur-
den of staving off summary judgment.
Texas courts presume that other states’ laws are the same as its own; the
party advocating use of a different state’s laws bears the burden of rebutting
that presumption. Excess Underwriters at Lloyd’s, London v. Frank’s Casing
Crew & Rental Tools, Inc., 246 S.W.3d 42, 53 & n.5 (Tex. 2008). Although fed-
eral courts are required to take judicial notice of the laws of every state, Kucel,
813 F.2d at 74, Texas choice-of-law rules put the burden on Abbasid to show how
applying New Mexico law would compel a result different from what Texas law
would yield. See Excess Underwriters, 246 S.W.3d at 53.
In its response to the summary judgment motion, Abbasid merely asserted
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that New Mexico law applies, without making any showing that it differs from
Texas law in any way or would compel a different result. The district court
nonetheless noted that Texas and New Mexico have adopted the same relevant
UCC provisions. Even in the face of that, Abbasid did not make any arguments,
in its opening brief, showing how New Mexico law would compel a different
result, and its reply brief only hints at the possibility that New Mexico law,
despite facially identical statutes, might be different. Thus, Abbasid has not met
its burden adequately to raise a choice-of-law issue.
Moreover, under this court’s standards for summary judgment, once the
moving party has made a sufficient showing that it is entitled to judgment as a
matter of law, the burden shifts to the nonmovant to demonstrate a genuine
issue for trial supported by facts and law. Cotroneo, 639 F.3d at 191. BoA’s
motion more than adequately met its burden to show it was entitled to summary
judgment, but Abbasid’s bare invocation of New Mexico law, without demon-
strating that the application of New Mexico law would defeat BoA’s summary
judgment motion, did not carry its burden.
The summary judgment is AFFIRMED.
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