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in Re Guggenheim Corporate Funding, LLC, Orpheus Holdings LLC, Stellar Funding Ltd., and Orpheus Funding LLC
380 S.W.3d 879
| Tex. App. | 2012
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Background

  • Guggenheim seeks a writ of mandamus to force enforcement of jury waivers in the 2006 loan documents regarding Valerus’s Amended Warrants.
  • Valerus filed suit seeking rescission of 2009 Amended Warrants, alleging fraud and mistaken terms, with Valerus requesting a jury trial.
  • Original Warrant (2006) granted Guggenheim a 3.5% equity stake with anti-dilution protections; it was later split into Interim Warrants (2008) and then amended in 2009 to alter 'calculated at exercise' mechanics.
  • Valerus’s recapitalization with TPG increased the number of units Guggenheim could acquire, allegedly altering the original economic bargain.
  • The Fee Letter (also a Loan Document) incorporated the Original Warrant by reference and expressly includes it as a Loan Document.
  • The trial court denied Guggenheim’s motion to enforce the jury waivers; the matter is reviewed under mandamus standard for scope and enforceability of the waivers.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether the 2006 jury waivers apply to the Amended Warrants. Guggenheim argues waivers cover any amendments and related actions. Valerus contends waivers do not cover standalone Amended Warrants. Yes; waivers apply to Amended Warrants and related claims.
Whether the scope of the waivers is broad enough to include claims arising from the underlying intent of the Original Warrant. Guggenheim contends scope includes any related disputes and amendments. Valerus asserts scope is limited to the Amended Warrants themselves. Yes; scope includes claims relating to original warrant and its amendments.

Key Cases Cited

  • In re Prudential Ins. Co. of Am., 148 S.W.3d 124 (Tex. 2004) (mandamus standards for enforcing contract-based waivers; no adequate remedy by appeal)
  • In re Bank of Am., N.A., 278 S.W.3d 342 (Tex. 2009) (no presumption against waiver; conspicuous waiver suffices; breadth of waiver)
  • In re General Elec. Capital Corp., 203 S.W.3d 314 (Tex. 2006) (conspicuous waiver evidence of knowing and voluntary waiver)
  • In re Key Equip. Fin., Inc., 371 S.W.3d 296 (Tex. App.—Houston [1st Dist.] 2012) (enforcement of contractual jury waivers in commercial leases; strong contract‑freedom policy)
  • In re Lisa Laser USA, Inc., 310 S.W.3d 880 (Tex. 2010) (focus on underlying claim scope to determine if within arbitration/forum clause)
  • Nafta Traders, Inc. v. Quinn, 339 S.W.3d 84 (Tex. 2011) (broad interpretation of related-to and related-to clauses; contract intent)
Read the full case

Case Details

Case Name: in Re Guggenheim Corporate Funding, LLC, Orpheus Holdings LLC, Stellar Funding Ltd., and Orpheus Funding LLC
Court Name: Court of Appeals of Texas
Date Published: Sep 11, 2012
Citation: 380 S.W.3d 879
Docket Number: 14-12-00329-CV
Court Abbreviation: Tex. App.