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Oswald v. Shehadeh

Court of Appeals of Indiana

August 6, 2018

Beverly K. Oswald, Appellant-Plaintiff,
v.
Tarek Shehadeh and Falon Vela, Appellees-Defendants

          Appeal from the Hamilton Superior Court The Honorable Steven R. Nation, Judge The Honorable David K. Najjar, Magistrate Trial Court Cause No. 29D01-1701-PL-211

          ATTORNEY FOR APPELLANT Charles E. Oswald Harrison & Moberly, LLP Indianapolis, Indiana

          ATTORNEYS FOR APPELLEE: TAREK SHEHADEH Christopher J. Evans Shana D. Tesnar Adler Tesnar & Whalin Noblesville, Indiana

          Vaidik, Chief Judge.

         Case Summary

         [¶1] Beverly Oswald, an Indiana resident, sued Tarek Shehadeh and Falon Vela, Arkansas residents, in Indiana for breach of contract. Shehadeh and Vela moved to have the suit dismissed for lack of personal jurisdiction. The trial court agreed that Indiana lacked personal jurisdiction over the defendants and dismissed the suit.[1]

         [¶2] On appeal, Oswald contends that Shehadeh and Vela had sufficient minimum contacts in Indiana to give Indiana specific personal jurisdiction over the defendants and that exercise of personal jurisdiction over the defendants is reasonable. Shehadeh argues that personal jurisdiction does not exist in Indiana, and, even if he and Vela are subject to personal jurisdiction in Indiana, the contract at issue contains a forum-selection clause requiring Oswald's claim to be heard in Arkansas.[2] We agree with Oswald that Indiana can exercise personal jurisdiction over Shehadeh and Vela and that it is reasonable for Shehadeh and Vela to defend this matter in Indiana. Furthermore, the language of the contract is not a forum-selection clause but rather a choice-of-law provision requiring the trial court to apply Arkansas law. We reverse the trial court's order and remand for further proceedings.

         Facts and Procedural History

         [¶3] Oswald is the sole owner of Eville Louie, LLC, which owns and operates Bar Louie restaurants and is headquartered in Indiana. In January 2010, Eville Louie owned and operated two Bar Louie Restaurants in the Little Rock, Arkansas area-Little Rock Louie, LLC, and North Rock Louie, LLC. One month later, Oswald interviewed candidates for the general-manager position of the Little Rock Louie restaurant. The interviews took place in Indiana, and Shehadeh was one of the applicants interviewed. During his interview, he expressed an interest in buying an ownership stake in Little Rock Louie and North Rock Louie. At the time, Oswald declined his offer but hired Shehadeh as the Little Rock Louie general manager. Shehadeh returned to Indiana in April 2010 to participate in a mandatory two-week Bar Louie training program. As part of his duties as general manager, Shehadeh repeatedly contacted Oswald and other Indiana residents, and he traveled to Indiana to attend Bar Louie management meetings.

         [¶4] In 2015, Shehadeh and Vela contacted Oswald in Indiana and expressed their interest in buying Little Rock Louie and North Rock Louie. Oswald agreed to sell the Arkansas restaurants to the pair. The sales contract was signed and executed in September 2015. As part of the terms of the sale, Shehadeh and Vela "assume[d] and agree[d] to pay all lender obligations relative to both businesses." Appellant's App. Vol. II p. 13. These obligations included twelve promissory notes-eight of which were held by Indiana residents or Indiana corporations. Shehadeh and Vela also agreed to pay Oswald annual installments for the cost of the restaurants. At all relevant times, Oswald lived in Indiana.

         [¶5] After Shehadeh and Vela began operating the Arkansas restaurants, they continued to use an Indiana payroll company, an Indiana insurance agent, and Indiana accountants. Shehadeh also "received corporate mail in Indiana" and continued to receive mail there as of October 2017. Id. at 51.

         [¶6] In January 2017, Oswald sued Shehadeh and Vela in Hamilton County, Indiana, for breach of contract. Shehadeh and Vela separately moved for the case to be dismissed for lack of personal jurisdiction. Oswald responded and filed an affidavit in support of her position. Shehadeh replied and filed his own affidavit in support of his motion. After the hearing on the motions, the trial court concluded that Indiana lacked personal jurisdiction over Shehadeh and Vela and dismissed the case.

         [¶7] ...


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