OPINION
Aрpellant, Craig Glattly, appeals from the denial of his special appearance. See Tex. Civ. PRAC. & Rem.Code Ann. § 51.014(a)(7) (Vernon Supp.2004-2005). We affirm.
Background
Glattly, who is not a Texas resident, wore several corporate hats. First, he was the president and CEO of Academic Capital, L.L.C. Second, Glattly was a principal shareholder, the president, and the CEO of Academic Capital Group, Inc. (“ACG”), which was incorporated in 1999 to succeed to the business of Academic Capital, L.L.C. Third, Glattly was a principal shareholder, the president, and the CEO of Academic Capital Services, Inc. (“ACS”). 1 In this opinion, wе refer to ACG and ACS together as “the Academic entities.” None of the Academic entities was a Texas corporation.
ACG’s business was to underwrite and to finance certain leases, which ACG accomplished with capital provided under lines of credit with third-party lenders. ACS completed the lease transactions and administered the agreements’ lease payments.
Appellee, CMS Virón Corporation (“Vi-rón”), was a Missouri corporation that was
The Master Lease between Virón and TSU provided that it was to be construed in accordance with the laws of Texas. The Lease Assignment between Virón and ACG’s predecessor provided, in part, that
If [Virón] has performance responsibilities under the Master Lease, and [TSU] abates payment of rent due to [Viron]’s lack of performance (as determined by [TSU]), then, upon notice to [Virón] from [ACG’s predecessor], [Virón] will remit such abated amount within 10 days of [ACG predecessor’s] notice.
The Escrow Agreement signed by Virón, TSU, and ACS provided, in part, as follows:
1. This Escrow Agreement relates to and is hereby made part of the [Master Lease] dated August 22, 1998 between [Virón] and [TSU],....
[[Image here]]
3. [Virón, TSU, and ACS] agree that [ACS] will act as sole escrow agent under the [Master] Lease and this Escrow Agreement.... [ACS] shall not be deemed to be a party to the [Master] Lease, and this Escrow Agreement shall be deemed to constitute the entire agreement between [Virón, TSU, and ACS].
[[Image here]]
7. Moneys in the [escrow fund] shall be used for the cost of acquisition of the Equipment and related delivery, engineering and installation costs. Payment shall be made from the [escrow fund] for the cost of acquisition of part or all Equipment upon presentation to [ACS] of one or more properly executed Payment Request Forms executed by [TSU]....
[TSU] agrees that, should the final acceptance of the Equipment not occur prior to December SO, 1999, the unspent funds in the [Escrow account] shall become the prоperty of [TSU], and that the [Master] Lease and Lease Payments will commence as if Acceptance had occurred on December 30, 1999, pursuant to sections 2 and 4 of the [Master] Lease.
[[Image here]]
12. This Escrow Agreement shall be governed by and construed in accordance with the laws of the State of Illinois.
(Emphasis added.)
ACS made three of four payments from the escrow account to Virón for the TSU project. However, in December 1999, before the fourth payment was requested or
In October 2002, State Street Bank sued Virón for breach of contract, negligence, and breach of warranty relating to Viron’s alleged faulty performance under the Master Lease and related matters. In December 2002, Virón counterclaimed against State Street Bank for breach of contract, conversion, and breach of fiduciary duty; asserted third-party claims against TSU for breach of contract and quantum meru-it; and asserted third-party claims against the Academic entities for breach of contract, conversion, and breach of fiduciary duty relating to the payment of escrow funds to State Street Bank, rather than to Virón. Virón also sоught indemnification from TSU if State Street Bank prevailed in its claims against Virón. In December 2003, the Academic entities asserted third-party claims against State Street Bank, seeking indemnification if Virón prevailed on its claims against the Academic entities.
By February 2004, Virón had amended its petition to assert claims against Glattly, Dennis Stephans,
4
and Eric Harkness
5
in their individual capacities (collectively, “the individual defendants”) for breach of fiduciary duties, conversion, negligence (including gross negligence), fraud, breach of contract, tortious interference with con-
The trial court granted the special appearances of Harkness and Stephans, but denied the special appearance of Glattly. Glattly appeals. 8
Standard of Review
Although a legal conclusion concerning the existence of personal jurisdiction is a question of law subject to
de novo
review, that conclusion must sometimes be preceded by the resolution of underlying factual disputes.
BMC Software Belgium, N.V. v. Marchand,
Personal Jurisdiction
In two issues, Glattly argues that the trial court erred in denying his special appearance because the court had no specific personal jurisdiction over him, it had no general personal jurisdiction over him, and it could not assert personal jurisdiction over him based on the corporate defendants’ being his alter egos.
A. The Law
The plaintiff bears the initial burden of pleading allegations sufficient to bring a non-resident defendant within the
The long-arm statute provides that, “[i]n addition to other acts that may constitute doing business, a nonresident does business in this state if the nonresident: ... (2) commits a tort in whole or in part in this state_” Tex. Civ. PRAC. & Rem.Code Ann. § 17.042(2) (Vernon 1997). “On reaching a decision to exercise or [to] decline jurisdiction based on the defendant’s alleged commission of a tort, the trial court should rely only on the necessary jurisdictional facts and should not reach the merits of the case.”
Wright,
A court may assert personal jurisdiction over a non-resident defendant only if “the Texas long-arm statute authorizes jurisdiction and the exercise of jurisdiction is consistent with federal and state due process standards.”
Am. Type Culture Collection,
Federal due process requirements are two-fold. First, the non-resident defendant must have purposefully established such minimum contacts with the forum state that the defendant could reasonably anticipate being sued there.
Burger King Corp. v. Rudzewicz,
Minimum-contacts analysis is further divided into general and specific personal jurisdiction.
CSR, Ltd. v. Link,
General personal jurisdiction allows a forum to exercise jurisdiction over a defendant even if the cause of action did not arise from or relate to the defendant’s contacts with the forum.
Am. Type Culture Collection,
Second, if the nonresident defendant has purposefully established minimum contacts with the forum, the exercise of personal jurisdiction must also comport with fair play and substantial justice.
Burger King Corp.,
B. Specific Personal Jurisdiction
Under part of his first issue, Glattly argues that Texas courts have no specific personal jurisdiction over him.
We begin by noting that Glattly made his special appearance “to the entire procеeding,” rather than asserting that specific claims were severable and making his special appearance only as to them.
See
Tex.R. Civ. P. 120a(l) (“A special appearance may be made as to an entire proceeding or as to any severable claim involved therein.”);
Dawson-Austin,
Among other claims, Virón alleged that Glattly had personally committed various intentional torts against it, such as breach of fiduciary duty, conversion, fraud, tortious interference with contractual relationships, and misapplication of fiduciary property. “It is well-settled that a corporate agent can be held individually liable for fraudulent statements or knowing misrepresentations even when they are made in the capacity of a cоrporate representative.”
Wright,
In response to Glattly’s special appearance, Virón produced evidence showing that the escrow account, funds, and contractuаl arrangement and any duties flowing from them were clearly tied to the TSU project, which took place in Texas. Even though Glattly did not sign any agreement arising out of the TSU project personally, the torts that he was alleged to have committed — -all of which were based on his decision to disperse the escrow funds to State Street Bank — necessarily affected the TSU project because they affected the funds earmarked for payment to the project’s parties. The disputed escrow funds amounted to over $2 million and constituted the final payment under the Master Lease, the contract executed to carry out the TSU project. Additionally, Virón produced as evidence Glattly’s deposition testimony, in which he admitted to having called or talked to Gina Bolt, TSU’s general counsel, “multiple times” about the problems that had arisen in December 1999 on the TSU project and indicated that he may have spoken with “anyone at [TSU] who could shed light on” the situation. The evidence also showed that Glattly received four faxes from Bolt about matters related to the TSU project dispute. We recognize that Virón did not allege any tort arising directly out of Glattly’s communiсations with TSU, but we regard these communications as showing that Glattly could have foreseen that the commission of the torts that Virón did
Given this context, we hold that Glattly’s alleged tort liability sufficiently “related to” conduct purposefully directed toward Texas, and likewise that Glattly’s alleged conduct had a sufficiently substantial connection to Texas, for the exercise of personal jurisdiction over Glattly to comport with due process. Put another way, it would have been foreseeable to a person committing thе tortious acts alleged here that the injurious effect of those acts would extend into Texas.
See Wright,
Glattly does not challenge the sufficiency of the evidence relating to the court’s implied factual findings based on Viron’s evidence.
See Preussag Aktiengesellschaft,
We reject Glattly’s first category of arguments because it focuses on only part of the overall situation. All of the contracts were interrelated: the Escrow Agreement existed to service and to fund the Master Lease; the Master Lease existed to allow the TSU project to move forward; the TSU project took place in Texas. Glattly’s alleged tortious disposal of the very escrow funds that funded the TSU project thus substantially related to activities in Texas and could potentially have a significant effect in that forum. Wе reject Glattly’s second category of arguments because it relates, in essence, to the merits of whether he actually committed the intentional torts that Virón alleged. Ultimate tort liability is not a jurisdictional fact; the merits of claims are not at issue during a special appearance; and the proof necessary to show personal jurisdiction is only that the purposeful act was committed in Texas.
Wright,
We hold that Glattly did nоt carry his burden of negating every basis for specific personal jurisdiction. Given this holding and the fact that Virón alleged that Glattly had committed intentional torts and fraudulent acts, we further hold that the trial
C. Fair Play and Substantial Justice
Because we have determined that Glattly purposefully established minimum contacts with Texas, we must also determine whether the exercise of personal jurisdiction over him comports with fair play and substantial justice.
See Burger King Corp.,
Glattly had the burden to prеsent a “compelling case” that exercising personal jurisdiction over him would not comport with fair play and substantial justice.
See Guardian Royal,
Glattly asserts that exercising personal jurisdiction over him does not meet this test. Specifically, Glattly argues that (1) he would be burdened by having to defend himself in Texas because he did not engage in economic activity in Texas “either at the time of the alleged liability or at the time the lawsuit was filed, and he does not now”; (2) Texas has no compelling interest in providing a forum for the resolution of the dispute between Virón and Glattly because both are non-residents and because their contacts occurred exclusively out of state; and (3) allowing him to be sued in Texas just because the other parties to the lawsuit first sued or were sued here “would permit jurisdiction over a defendant to be determined by plaintiff or by a third-party, contrary to due process requirements.” 11
However, Glattly did not make these specific arguments in the trial court with respect to the fair-play-and-substantial-justice inquiry. Rather, he twice stated-in cursory and conclusory fashion — simply that the assertion of personal jurisdiction over him would offend traditional notions of fair play and substantial justice. The only elaboration that he prоvided below
Conclusion
We overrule appellant’s first issue. We do not reach his second issue (concerning personal jurisdiction based on alter ego status). We affirm the order of the trial court.
Notes
. ACS was formerly known as Academic Service Corporation.
. ACS paid the remaining escrow funds to State Street Bank in four payments, the last payments of which appear to have been authorized by another оfficer of the Academic entities. That officer is no longer a party to this lawsuit.
. For example, in contesting Glattly’s special appearance, Virón produced evidence that, in December 1999, it sent ACS a form request for the fourth and final payment, which form was also signed by TSU's Associate Vice President of Facilities, and which indicated that "the amount of this requisition constitutes a partial acceptance of the project.” Virón also produced a certificate of final delivery and acceptance for the TSU project, which Glattly acknowledged was presented to ACS, signed by the same TSU official and dated December 22, 1999, indicating that Viron’s equipment and work was satisfactory to and accepted by TSU. Virón also relied below on a portion of Glattly’s deposition in which he stated that he did not tell a Virón officer before the payment to State Street Bank that ACS was paying the escrowed funds to State Street Bank. It is also evident from Viron’s counsel’s deposition questions that one of Viron’s theories in the underlying lawsuit was that Glattly and ACS sought to please State Street Bank — an "excellent” customer of ACS’s with whom it had done business repeatedly and with which ACS "wаnted to maintain a good client relationship” — by paying the escrow money to it, rather than to Virón. On the other hand, other evidence indicated that (1) Glattly knew that TSU's alleged problem with Viron’s performance continued after Viron’s final payment request and after TSU signed the certificate of final delivery and acceptance; (2) Glattly was simply following the Escrow Agreement’s terms when he paid the escrow funds to State Street Bank; and (3) Glattly informed Viron's officer, without objection, that he would pay the escrow funds to State Street Bank.
. Dennis Stephans was, at various times, a shareholder and an officer of ACG.
. Eric Harkness eventually became the sole shareholder in ACG and was a principal shareholder in ACS.
. By this time, Virón had dropped TSU as a third-party defendant.
. Virón did not differentiate the individual defendants' actions allegedly constituting fraud and misapplication of fiduciary property from the actions of the other third-party defendants.
.Although Virón appealed the granting of Harkness’s and Stephans’s special appearances, it later moved to dismiss its appeal. We previously granted Viron’s motion to dismiss its appeal, and our judgment now incorporates that dismissal.
. See Tex. Civ. Prac. & Rem.Code Ann. § 17.042 (Vernon 1997).
. Glattly relies on
Vosko v. Chase Manhattan Bank, N.A.
for the proposition that he cannot be sued in Texas simply because of the Academic entities' activities.
See 909
S.W.2d 95, 99 (Tex.App.-Houston [14th Dist.] 1995, writ denied) (holding that individual defendant was not subject to general personal jurisdiction based on actions of corporation with which he was associated unless corporation was alter ego of individual). That holding in
Vosko
is distinguishable because it concerned general personal jurisdiction, not specific personal jurisdiction based on alleged intentional torts or fraud.
See Wright v. Sage Eng’g, Inc.,
. Glattly also argues, with respect to the shared interest of the several states in furthering fundamentad, substantive social policies, that "the substantive policy here should be the refusal to exercise jurisdiction ex post facto where there was no jurisdiction at the time of the injury; further, that continuing contact in the forum state which begins aifter a cause of action arose outside the forum state should be irrelevant to the jurisdictional inquiry.’’ This argument relates to Glattly’s challenge concerning the exercise of general personal jurisdiction over him. Because we do not decide whether Texas courts may exercise general personal jurisdiction over Glattly, we do not consider this argument.
