CDC Real Estate v. La Biela
24-50626
5th Cir.Aug 5, 2025Background
- CDC Real Estate Corporation (CDC), a Texas corporation, served as manager of La Biela, L.L.C., a Colorado-based limited liability company, for over 20 years.
- In September 2023, CDC, while acting as La Biela’s manager, entered into a transaction to purchase a 25% interest in a Colorado LLC for $570,000—owned by CDC’s sole owner, John Callahan—raising concerns of unauthorized self-dealing.
- Jeff Oberg, a member of La Biela, objected to the transaction and later replaced CDC as La Biela’s manager, though the timing of CDC’s resignation is disputed.
- CDC sued in Texas for a declaratory judgment establishing the validity of the transaction and its management authority; defendants removed the case to federal court.
- The district court dismissed the case for lack of personal jurisdiction over the Colorado-based defendants, finding insufficient contacts with Texas.
- CDC appealed the dismissal to the Fifth Circuit.
Issues
| Issue | Plaintiff’s Argument | Defendant’s Argument | Held |
|---|---|---|---|
| General jurisdiction over La Biela, Oberg, and Trust | La Biela was managed from Texas for 20+ years | La Biela is based/incorporated in Colorado, not Texas | General jurisdiction does not exist |
| Specific jurisdiction over La Biela | Management contract and activities took place in Texas | No business assets or activities in Texas; contract silent on location | Specific jurisdiction does not exist |
| Minimum contacts through managerial acts | Manager’s Texas activities should count as contacts | Only manager’s unilateral acts; company did not purposefully avail itself of Texas | Minimum contacts not established; plaintiff’s actions insufficient |
| Specific jurisdiction over Oberg and Trust | Agency theory and same arguments as for La Biela | No direct contacts by individual defendants with Texas | No specific jurisdiction over individual defendants |
Key Cases Cited
- Daimler AG v. Bauman, 571 U.S. 117 (limits general jurisdiction over corporations to places where they are "at home")
- Walden v. Fiore, 571 U.S. 277 (defendant’s conduct must create a substantial connection with the forum state)
- Perkins v. Benguet Consol. Mining Co., 342 U.S. 437 (general jurisdiction permissible where operations are centered in forum state)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (unilateral activity of another party does not confer jurisdiction)
- Moncrief Oil Int’l, Inc. v. OAO Gazprom, 481 F.3d 309 (mere foreseeability and plaintiff’s unilateral acts do not create jurisdiction)
- Holt Oil & Gas Corp. v. Harvey, 801 F.2d 773 (choice-of-law provisions diminish significance of forum contacts)