508 S.W.3d 569
Tex. App.2016Background
- Fatal accident (2010) caused by alleged failure of a high‑pressure hydraulic hose used on a Texas drilling rig; plaintiffs are decedent's survivors (the Smithers).
- Hose manufactured by STP (Austrian company); STP wholly owns SIP (New Jersey sales subsidiary) which sold the hose to Mid West (Oklahoma distributor), which resold into Texas.
- STP manufactured hoses overseas, shipped many hoses into the U.S.; from 2002–2012 it delivered several million dollars’ worth of product that ultimately reached Texas (figures in evidence ranged ~$4.9–7.1M).
- SIP operated to sell STP products in the U.S. without geographic limitation; STP retained significant involvement (branding for Mid West, invoicing, approval rights, deliveries), but no written distributor contract.
- Trial court denied STP’s special appearance (personal jurisdiction challenge); STP appealed. Plaintiffs also argued alter ego and that SIP’s forfeited charter/answer waived jurisdictional defenses.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Texas has specific jurisdiction over STP via stream‑of‑commerce | STP purposefully availed itself of Texas market by using SIP and Mid West, selling and shipping hoses that it knew would be used in Texas; the injured use occurred in Texas. | STP marketed to the U.S. generally; sale to Oklahoma distributor is too attenuated and lacks the Asahi "plus" factors targeting Texas. | Held: Specific jurisdiction exists — STP’s purposeful contacts (subsidiary network, branding, deliveries, substantial sales to TX) were substantially connected to the claim. |
| Whether SIP’s jurisdictional contacts can be imputed to STP via alter ego | SIP’s activities and STP’s control (budget approval, hiring approval, overlapping management, use of Semperit branding) show control beyond ordinary parent relationship. | STP’s involvement is ordinary parental oversight; no evidence of commingling, shared offices, or conduct that would justify piercing the corporate veil. | Held: Alter ego not established on this record; SIP’s contacts were not attributed to STP under alter ego theory. |
| Whether SIP’s dissolved/forfeited New Jersey charter and its filing of an answer during forfeiture converted to a general appearance by STP | Plaintiffs: SIP’s continued business while charter forfeited made it effectively the same as STP and waived jurisdictional defenses. | STP: SIP answered the suit but reinstatement and New Jersey law permit a dissolved corp to defend actions while winding up; no general appearance by STP. | Held: SIP’s answer during forfeiture did not impute a general appearance by STP; New Jersey law allows a dissolved corporation to defend suits while winding up. |
| Whether exercising jurisdiction would be unfair under International Shoe fairness factors | Plaintiffs: Texas is the injury forum and plaintiffs' interest and efficient resolution support jurisdiction. | STP did not challenge the fairness prong on appeal. | Held: Fairness prong not contested; court noted no violation of fair play/substantial justice and declined to overturn. |
Key Cases Cited
- Spir Star AG v. Kimich, 310 S.W.3d 868 (Tex. 2010) (upholding specific jurisdiction where foreign hose maker distributed through Texas subsidiary)
- International Shoe Co. v. Washington, 326 U.S. 310 (U.S. 1945) (minimum contacts and due process framework)
- World‑Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (U.S. 1980) (stream‑of‑commerce concept in products cases)
- Asahi Metal Ind. Co. v. Superior Court, 480 U.S. 102 (U.S. 1987) (plurality articulating stream‑of‑commerce plus factors)
- J. McIntyre Machinery, Ltd. v. Nicastro, 564 U.S. 873 (U.S. 2011) (plurality/concurring views on nationwide distribution and purposeful targeting)
- Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569 (Tex. 2007) (Texas test requiring a substantial connection between contacts and operative facts of litigation)