SAS Mfg Inc v. Safe Life Defense LLC et al

OCR transcription for search; preserved printed pages are authoritative

Case 4:24-cv-02923 Document 70 Filed on 12/01/25in TXSD Pagelof5
United States District Court

Southem District of Texas
ENTERED
UNITED STATES DISTRICT COURT December 01, 2025
SOUTHERN DISTRICT OF TEXAS Nathan Ochsner, Clerk
HOUSTON DIVISION
SAS Mfg. Inc., and §
Allan D. Bain, §
Plaintiffs, §
§
Vv. § Civil Action H-24-2923

§
Safe Life Defense, LLC, and §
Nicholas Groat, §
Defendants. §

ORDER SEVERING AND TRANSFERRING CLAIMS

Pending before the court is Defendant Safe Life Defense,
LLC’s (Safe Life) Motion to Dismiss Counter-Counter Claim, ECF
No. 55.! The parties consented to the jurisdiction of the
undersigned magistrate judge for all purposes, including entry of
final judgment. ECF Nos. 66 and 67. The motion is GRANTED in
part and DENIED in part.

1, Background

SAS Manufacturing, Inc. d/b/a Stealth Armor Systems (SAS)
and its CEO Allan Bain (together, Plaintiffs) filed suit against Safe
Life Defense, LLC (Gafe Life) and its CEO Nicholas Groat
(together, Defendants) for violations of the Lanham Act. ECF
No. 1. Plaintiffs allege in their Second Amended Complaint that
they manufacture and sell the patented HEXAR flexible rifle
armor. ECF No. 46 at 6. Safe Life offers a similar flexible rifle
armor product. Id.

Plaintiffs allege that Safe Life and Groat made false and

misleading representations about the nature, characteristics, and

1 The redacted, unsealed version of the Motion to Dismiss, ECF No. 53, is also pending.
The court only refers to the sealed, unredacted motion for clarity.

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qualities of the protective coverage area and weight of Safe Life’s
products in violation of Section 43(a) of the Lanham Act, 15 U.S.C.
§ 1125(a). ECF No. 46 at 11. In their Answer, Safe Life and Groat
filed two counterclaims alleging that SAS and Bain made false
representations as to the (1) origin and (2) testing of SAS’s
products in violation of the same Lanham Act provision, ECF
No, 48-1 at 17-18.

In their Answer to Safe Life and Groat’s counterclaims, SAS
and Bain allege their own counterclaims (which the parties refer
to as “counter-counterclaims”). ECF No. 52. The court refers to
Plaintiffs’ claims asserted in ECF No. 52 as the contract claims.
SAS and Bain’s contract claims are related to a 2023 License and
Manufacturing Agreement (the Licensing Agreement) between
SAS and Safe Life. fd. at 11-12; ECF No. 55-5. SAS and Bain bring
claims for breach of contract and seek declaratory judgment that
Safe Life failed to comply with the Licensing Agreement. Jd. at 11—
12,

The Licensing Agreement allows Safe Life to make, use, sell,
offer to sell, and promote specific categories of SAS’s patented
HEXAR intellectual property. ECF No. 55-5 at7, 37, The
Licensing Agreement also states that:

The Parties shall attempt to resolve any disputes
between them arising out of this Agreement through
good faith negotiations. In the event the Parties
cannot resolve a dispute within thirty (30) days after
one Party has given the other Party written notice of
the existence of the dispute, such dispute shall be
exclusively settled by either binding arbitration if the
parties agree or in state or US Federal Court located
in Dallas/Ft. Worth Texas.

id, at 31.
Safe Life now moves to dismiss the contract claims pursuant
to Rules 12(b)(3) and 124). ECF No. 55. The parties have also

2

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informed the court that, in addition to the contract claims pending
before the undersigned, a lawsuit is currently pending in state
court regarding breach of the Licensing Agreement. ECF No. 53-1
(stating that the case is set for a trial term beginning December 1,
2025, in the 95% Judicial District Court of Dallas County); ECF
No. 63 at 2, 5.

2 Legal Standard and Analysis

Safe Life seeks dismissal of the contract claims for improper
venue under Rule 12(b)(8) and pursuant to the court’s inherent
authority and Rule 12(f). ECF No. 55 at 1. Safe Life argues that
the contract claims are subject to a mandatory forum selection
provision in the Licensing Agreement, Jd.

The Supreme Court has clarified that Rule 12(b)(8) is not an
appropriate procedural vehicle to enforce a forum selection clause.
Atl. Marine Constr. Co., v. U.S. Dist. Ct. for W. Dist. of Texas, 571
U.S. 49, 52, 55 (2013). Instead, where venue is proper under
federal venue statutes, 18 U.S.C. § 1404(a) provides the proper
mechanism for enforcement of forum selection clauses that point
to a particular federal district. fd. at 59.

Although Safe Life did not move for transfer under § 1404(a),
“lal transfer of venue may be made upon the motion of any party
or by the court sua sponte.” Thomas v. Joule Processing LLC, No.
23-CV-1615, 2023 WL 8487634, at *2 n.3 .D. Tex. Dec. 5, 2028)
(quoting Empty Barge Lines I, Inc. v. Dredge Leonard Fisher, 441
FE. Supp. 2d 786, 789 (E.D. Tex. 2006)). It appears that, aside from
the forum selection clause, venue is otherwise proper in this court.
No party argues otherwise. Thus, although Safe Life moves for
dismissal under 12(b)(8), the court finds that § 1404(a) is the
correct vehicle for analyzing whether the contract claims should be

transferred due to the forum selection clause.

"[P]roper application of § 1404(a) requires that a forum
selection clause be 'given controlling weight in all but the most
exceptional cases."' Atl. Marine Constr. Co., 571 U.S. at 59-60
(quoting Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 33 (1988)
(Kennedy, J., concurring)). "[A]s the party defying the forum
selection clause, the plaintiff bears the burden of establishing that
transfer to the forum for which the parties bargained is
unwarranted." Id. at 63.
The Licensing Agreement states that any disputes arising
out of the agreement shall be resolved in state or federal court in
Dallas or Fort Worth, Texas. ECF No. 55-1 at 31. Safe Life argues
that SAS and Bain's contract claims should be dismissed because
they are subject to the forum selection clause and because there is
no common nucleus of operative facts between the contract claims
and the Lanham Act claims. ECF No. 55 at 3-6. SAS and Bain
argue that the Licensing Agreement "stipulates a venue in which
no party is a resident or domicile[d.]" ECF No. 63 at 5.
To the extent that SAS and Bain argue that their contract
claims should not be transferred because the stipulated forums are
inconvenient, their argument is not persuasive. "When parties
have contracted in advance to litigate disputes in a particular
forum, courts should not unnecessarily disrupt the parties' settled
expectations." Atl. Marine Constr. Co., 571 U.S. at 66. The
Licensing Agreement includes negotiated terms to which the
parties agreed. While Bain is not a party to the Licensing
Agreement, he signed it on behalf of SAS, as SAS's Chief Operating
Officer. ECF No. 55-5 at 35. SAS and Bain have failed to show that
the forum selection clause is unenforceable or invalid. SAS and
Bain have also failed to show that enforcement of the forum
selection clause would be unreasonable.
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The contract claims appear to be unrelated to the Lanham
Act claims. No party has shown that any provision of the Licensing
Agreement would impact any claim or defense under the Lanham
Act. No party argues that the court must interpret a provision of
the Licensing Agreement to resolve the Lanham Act claims. SAS
and Bain argue that “some of the information that allegedly forms
the basis of Safe Life Defense LLC’s Lanham Act claim were [sic]
learned by [sic] because of the License Agreement.” KECK No. 63
at 4, That argument does not alter the court’s conclusion,

The court finds that SAS and Bain’s contract claims for
breach of the Licensing Agreement and for declaratory relief
should be severed and transferred to the Northern District of
Texas, Dallas Division pursuant to the forum selection clause.
Accordingly, the Southern District of Texas is not the proper forum
to resolve Defendants’ remaining arguments. Defendants’
abstention arguments are better resolved in the forum mandated
by the Licensing Agreement. The court is not aware of any final
judgment in the state court case that would prevent the claims
from being heard in the correct federal forum.

3. Conclusion

Safe Life’s Motion to Dismiss, ECF Nos. 53 and 45, is
GRANTED in part. SAS and Bain’s counter-counterclaims in
ECF No, 52 are severed and transferred to the Dallas Division of
the Northern District of Texas.

Signed at Houston, Texas on December 1 , 2025.

Jefe

Peter Brdy
United States Magistrate Judge