Key Points

  • The Fourth District Court of Appeal reversed a Palm Beach County order denying Mitchell and Susan Krassan's motion to dismiss the Reich Family Limited Partnership's claims under a mandatory forum-selection clause.
  • The partnership agreement provides that the exclusive venue for any action brought in connection with it shall be in Carson County, Nevada.
  • Applying the nexus test of Milstein v. Nicklaus, 412 So. 3d 802 (Fla. 4th DCA 2025), the panel held that Counts IV through XIII and the fee request in Count XIV are sufficiently connected with the agreement because they concern the same transactions and implicate Mitchell Krassan's authority to act through the general partner and the agreement's rights and obligations.
  • The court remanded for dismissal of those claims without prejudice to their being brought in the Nevada forum and did not reach the parties' arguments concerning nonbinding arbitration.
  • Judges Gross, May and Lott concurred in the per curiam decision, which is not final until disposition of any timely motion for rehearing.

A Florida appeals court ruled on Oct. 14 that a family limited partnership must pursue its self-dealing claims against the man who served as president of its general partner, and against Susan Krassan, in Nevada rather than Palm Beach County. The court held that the partnership agreement's choice of Carson County, Nevada, as the exclusive venue for disputes covers those claims.

A three-judge panel of the Fourth District Court of Appeal reversed a Palm Beach County circuit judge who had refused to dismiss the Reich Family Limited Partnership's claims against Mitchell and Susan Krassan. The decision was unsigned, or per curiam, and Judges Gross, May and Lott concurred in it.

The ruling removes 10 counts and a request for attorney's fees from the Florida case. The trial judge had concluded that every challenged count except one, the count expressly pleading a breach of the partnership agreement, existed independently of that agreement. The appeals court held that the other claims also fall within the agreement's forum-selection clause because they concern the same transactions and their resolution implicates the authority and obligations the agreement establishes.

According to the opinion, the partnership is a Nevada limited partnership. Its general partner is a Nevada corporation, and its limited partners are three Florida trusts. Mitchell Krassan served both as the general partner's president and as a co-trustee of the trusts.

The partnership agreement provides "that the exclusive venue for any action brought in connection with this Agreement shall be in Carson County, Nevada." The panel described the clause as mandatory.

The partnership's complaint alleges that Mitchell Krassan used his authority over the partnership "to engage in self-dealing and make unauthorized transfers and other transactions involving Partnership assets." The partnership asserted Counts IV through XIII against Mitchell Krassan, Susan Krassan, or both. Count V alleges that Mitchell Krassan violated section 11.2 of the partnership agreement through loans and advances made on impermissible terms. The opinion does not describe the legal theories of the other counts.

The Krassans moved to dismiss Counts IV through XIV for improper venue under the forum-selection clause. Circuit Judge Charles E. Burton denied the motion. The appellate opinion summarizes his ruling as concluding that, other than Count V, "the claims raised in the remaining counts existed independently of the Partnership Agreement."

The Krassans appealed that nonfinal order. The Fourth District reviewed the question de novo and applied the test from its 2025 decision in Milstein v. Nicklaus. "Even in contracts containing broad forum selection clauses, whether a particular claim is subject to a forum selection clause necessarily depends on the existence of some nexus between the dispute and the contract containing the forum selection clause," the panel wrote, quoting Milstein.

"The Partnership's claims here satisfy that standard," the court held. The panel noted that Count V expressly alleges a violation of the agreement. It then found that the partnership's remaining claims against the Krassans "incorporate the same general allegations and concern the same or related transfers, loans, investments, and other transactions involving Partnership assets."

The panel tied those claims to the agreement's terms. "Resolution of those claims implicates Mitchell's authority to act through the general partner and the rights and obligations established by the Partnership Agreement," the court wrote. It again cited Milstein, which stated that a tort claim arising out of or relating to an agreement must, "at a minimum, raise some issue the resolution of which requires reference to or construction of some portion of the contract itself."

The partnership and Morton Reich, who are both named as appellees, had made other arguments concerning enforcement of the clause. The panel wrote that it had "considered and rejected" those arguments, without describing them. The opinion does not describe Morton Reich's role in the dispute.

The parties had also made arguments concerning nonbinding arbitration. The panel did not decide that question. "Because those claims must be dismissed pursuant to the forum selection clause, we do not reach the parties' arguments concerning nonbinding arbitration," the court wrote.

The disposition is limited to the counts the Krassans challenged. The court reversed the order "to the extent it denies dismissal of Counts IV through XIII and the Partnership's request for attorney's fees in Count XIV." The opinion does not address the complaint's first three counts, which the motion to dismiss did not target.

Robert J. Hauser of Sniffen & Harmon, P.A., in West Palm Beach represented the Krassans. The partnership and Morton Reich were represented by Eric A. Rice and Peter J. Forman of Gutter Chaves Josepher Rubin Forman Fleisher Miller P.A. in Boca Raton.

The panel remanded the case to the Palm Beach County circuit court for dismissal of the covered claims "without prejudice to being brought in the contractually-selected Nevada forum," citing its 2006 decision in Leatherwood v. Cardservice Int'l, Inc. The opinion is not final until the court disposes of any timely motion for rehearing.