On May 2, 2024, the First Department issued a decision in RDF Agent, LLC v. Electric Red Ventures, LLC, 2024 NY Slip Op. 02384, holding that a court did not err in refusing to dismiss a lawsuit in New York in favor of a first filed Texas action, explaining:
With respect to the July 2022 order, which is brought up for review upon the appeal from the judgment, we find that the court providently exercised its discretion in denying defendants’ motion to dismiss this action pursuant to CPLR 3211(a)(4). Although the Texas action was filed first, chronology is not dispositive, particularly since both actions were at the earliest stages of litigation when defendants moved to dismiss the New York lawsuit. A party who has reason to know a lawsuit will be brought against him should not be allowed to employ the expedient of filing an action to subject his opponent to a preferred forum, especially where the earlier action seeks declaratory relief filed in apparent anticipation of the other proceeding.
Although plaintiff had not actually threatened litigation before defendants sued it in Texas, defendants could readily infer from plaintiff’s March 28, 2022 letter that it would sue if they did not pay liquidated damages in the amount of $2.3 million. Plaintiff did not have to show them a draft complaint. Furthermore, it is suspicious that defendants did not immediately serve their petition on plaintiff; instead, they sent a letter suggesting settlement talks, and they said nothing about their lawsuit during those talks. It was only after settlement talks failed that they served their petition. Under these circumstances, it appears that the Texas action was filed to enforce defendants’ choice of forum if the ensuing settlement negotiations proved unavailing.
(Internal quotations and citations omitted)