Lead Opinion
EN BANC OPINION
In this suit arising from the alleged breach of confidentiality agreements and theft of trade secrets, three related com
On our own motion, we have decided this case en banc in order to answer an error-preservation question on which courts have reached conflicting results: to preserve a complaint for appeal that an affidavit fails to reveal the basis of the affiant’s personal knowledge of the stated facts, is it necessary to object and obtain a ruling? We conclude that it is.
We hold that the trial court did not err in determining that it lacked personal jurisdiction over the new corporation, and that the plaintiffs failed to preserve their complaint about the form of the order granting the special appearance. We therefore affirm the trial court’s special-appearance ruling. We further hold that the trial court did not abuse its discretion in partially denying the plaintiffs’ request for a temporary injunction, and we affirm that ruling as well.
I. Factual and Procedural Background
Appellants Washington DC Party Shuttle, LLC (“DC Party Shuttle”), Party Shuttle Tours, LLC and Creativerse Internet Systems, LLC (“Creativerse,” collectively “the Shuttle Parties”) filed suit against appellees IGuide Tours, LLC (“IGuide”), Tyree Cook, and Abise Eshetu (collectively “the IGuide Parties”), asserting claims for breach of contract, breach of fiduciary duty, and misappropriation of trade secrets. The Shuttle Parties also sought a temporary restraining order and temporary and permanent injunctions. According to the pleadings, DC Party Shuttle is a District of Columbia limited liability company with a principal place of business in the District of Columbia; Party Shuttle Tours, LLC is a Delaware limited liability company with a principal place of business in Houston, Texas; Creativ-erse is a Texas limited liability company with a principal place of business in Houston, Texas. As described by the Shuttle Parties in their live pleadings, these entities operate through a “network of companies that do business as OnBoard Tours.” The record reflects that DC Party Shuttle and Party Shuttle Tours are primarily engaged in the business of providing sightseeing tours, and that Creativerse owns and markets the websites for all of the OnBoard Tours companies.
The Shuttle Parties allege that Cook and Eshetu are residents of Virginia and former employees of DC Party Shuttle and Creativerse. According to the Shuttle Parties, Cook and Eshetu each signed a non-compete agreement with both DC Party Shuttle and Creativerse. Under the terms of these agreements, each was prohibited primarily from (a) engaging in a competing tour business or internet marketing business for three years following separation from the Shuttle Parties’ employment, (b) misusing confidential information, or (c) soliciting and hiring other employees of the Shuttle Parties. The Shuttle Parties allege that on December 1, 2011, Cook and Eshetu created IGuide, a competing sightseeing tour company, while they were still employed by two of the Shuttle Parties.
Cook and Eshetu left their respective employment with the Shuttle Parties on February 15, 2012. Two weeks later, IGuide began operating sightseeing tours employing other former employees of the Shuttle Parties. The Shuttle Parties filed suit the next day and obtained a temporary restraining order.
In their original petition, the Shuttle Parties’ jurisdictional allegations against IGuide consist solely of the statements that “this proceeding arises out of the business done in Texas and torts committed in Texas” and that the trial court “has personal jurisdiction over IGuide because it is conducting business in Texas by marketing its services in Texas through a website and because it is conspiring with Defendants Cook and Eshetu to commit torts in Texas.” IGuide challenged the trial court’s exercise of personal jurisdiction over it by filing a special appearance supported by an affidavit from Sewunet Hab-te, a current IGuide employee and former employee of one or more of the Shuttle Parties.
B. Injunctive Relief
The Shuttle Parties obtained a temporary restraining order on the day they filed suit and later sought and obtained an extension of that order. The Shuttle Parties also sought a temporary injunction primarily to enjoin the IGuide Parties from using allegedly confidential internet-marketing information and from operating or marketing sightseeing tours in Washington, D.C. and certain other locations.
At the time of the hearing on the Shuttle Parties’ request for a temporary injunction, only Cook and Eshetu remained as defendants. The trial court granted the temporary injunction in what the Shuttle Parties characterize as “a very limited form.” As reflected in the trial court’s order, the trial court granted injunctive relief to Creativerse regarding the allegedly confidential internet-marketing information, and denied the request for injunctive relief “regarding sightseeing, tour and/or shuttle bus activities in competition with” DC Party Shuttle and Party Shuttle Tours.
II. Issues Peesented
In their first issue, the Shuttle Parties contend that the trial court erred in granting IGuide’s special appearance. In their second issue, they argue in the alternative that the form of the special-appearance order is erroneous. They assert in their third issue that the trial court erred in rendering a temporary injunction that fails to maintain the status quo.
III. Special Appearance
The Texas Supreme Court has interpreted the broad language of the Texas long-arm statute to extend Texas courts’ exercise of personal jurisdiction “ ‘as far as the federal constitutional requirements of due process will permit.’ ” BMC Software Belgium, N.V. v. Marchand,
Personal jurisdiction may be “general” or “specific.” Zinc Nacional, S.A. v. Bouche Trucking, Inc.,
A defendant challenging a Texas court’s exercise of personal jurisdiction over him must negate all jurisdictional bases alleged. BMC Software,
A. Standard of Review
Whether a trial court has personal jurisdiction over a defendant is a question of
We review the challenged factual findings by applying the same standards used in reviewing jury findings. Wiese v. Pro Am Servs., Inc.,
We review the trial court’s conclusions of law de novo. Greenfield Energy, Inc. v. Duprey,
B. Notice of the Hearing
The Shuttle Parties first assert that the trial court erred in granting IGuide’s special appearance because they received only five days’ notice of the special-appearance hearing instead of the six days’ notice they contend is required where, as here, notice of the hearing was served via fax. See Tex.R. Civ. P. 21 (setting forth the general rule that a notice of a hearing “shall be served upon all other parties not less than three days before the time specified for the hearing unless otherwise provided by these rules or shortened by the court”); Tex.R. Civ. P. 21a (<rWhenever a party has the right or is required to do some act within a prescribed period after the service of a notice or other paper upon him and the notice or paper is served upon by ... [fax], three days shall be added to the prescribed period.”). The
The Shuttle Parties have not explained why, under the circumstances presented here, the trial court abused its discretion in permitting the hearing to go forward. The Shuttle Parties did not move to continue the hearing, and they do not contend that they needed additional time to respond. In fact, the record shows that they filed (a) an eleven-page response just two days after IGuide filed its special appearance, (b) an additional four-page bench brief on the day of the hearing, and (c) a further four-page post-hearing brief on the day after the hearing. Under the circumstances, we hold that the trial court did not abuse its discretion.
C. Verification of the Special Appearance
The Shuttle Parties next assert that the trial court’s order sustaining IGuide’s special appearance must be reversed because, as they pointed out in the trial court, the special appearance was not made by a sworn motion. See Tex.R. Civ. P. 120a (“Such special appearance shall be made by sworn motion ... and may be amended to cure defects.”). Citing Casino Magic Corp. v. King,
This case is factually distinguishable from Casino Magic Corp. The reviewing court in Casino Magic Corp. noted that “the special appearance included a number of jurisdictional ‘facts’ which the witness failed to attest to in the affidavit.”
• it was formed under the laws of the State of Delaware and is registered in the District of Columbia;
• its members were and are residents of Maryland and Virginia at all times relevant to this case;
• it never has had any contractual relationship with any of the Shuttle Parties;
• it has never sued anyone in a Texas court and has not previously been sued in a Texas court;
• it does not maintain offices in Texas;
• it does not conduct business here;
• it does not maintain a corporate registration in Texas with the Texas Secretary of State;
• it does not have an agent for service of process in Texas;
• it does not have any employees in Texas;
• it does not have bank accounts in Texas;
• it does not does not own or maintain warehouses or inventory in Texas; and
*731 • it does not specifically target Texas with advertising.
In her affidavit, Habte attested to the truth of each of these facts. On appeal, the Shuttle Parties do not identify any jurisdictional fact that is stated in IGuide’s special appearance that is not repeated and sworn to by Habte in her affidavit. We therefore conclude that the affidavit sufficiently verified the special appearance. See Haddad v. ISI Automation Int’l, Inc., No. 04-09-00562-CV,
D. Timeliness of the Special-Appearance Affidavit
The Shuttle Parties also assert that the trial court erred in holding a hearing on the special appearance because IGuide’s supporting affidavit was not served seven days before the hearing as required by Rule 120a(3). In the trial court, however, they did not argue that the timing of the affidavit required that the hearing be postponed; they argued that because IGuide served the affidavit less than seven days before the special-appearance hearing, its special appearance was converted to a general appearance. Because the complaint presented on appeal does not comport with the Shuttle Parties’ objection in the trial court, it has not been preserved for our review. See Tex.R.App. P. 33.1(a); Cajun Constructors, Inc. v. Velasco Drainage Dist.,
E. Content of the Special-Appearance Affidavit
In addition to their complaints about alleged procedural defects, the Shuttle Parties argue that the content of Habte’s affidavit was inadequate to meet IGuide’s burden of proof. We address each of these arguments separately.
1. Personal Knowledge
The Shuttle Parties contend that Habte’s affidavit does not show that she is personally familiar with the facts to which she attested. On our own motion, we have considered this case en banc to address the question of whether a party must preserve such a complaint in the trial court by obtaining a ruling — or a refusal to rule— on a timely and specific objection. See Tex.R.App. P. 33.1(a).
The cases in which such complaints have been addressed do not provide a clear and consistent answer to the error-preservation question. The Texas Supreme Court has held that lack of personal knowledge renders an affidavit legally insufficient. See, e.g., Marks v. St. Luke’s Episcopal Hosp.,
It is clear from reading the entire affidavit that [the affiant] was testifying from personal knowledge and was competent to testify regarding the matters stated. Even if these elements were not shown on the face of the affidavit, Vaughan’s failure to object to these defects in form resulted in waiver.
Id. (emphasis added).
In the years since Vaughan was decided, the Texas Supreme Court has neither cited that case nor explicitly overruled it. Nevertheless, five years after Vaughan, the Texas Supreme Court — without discussing error preservation — agreed with the Fifth Court of Appeals in holding that the summary-judgment affidavits challenged in Laidlaw Waste Systems were defective for reasons that included the eon-clusory nature of the affiant’s statements and the absence of any indication that the affiant was “competent to testify” on the matters described in the affidavit.
The Texas Supreme Court did not specifically state — in Laidlaw Waste Systems or elsewhere — that no objection is required to preserve an argument that an affidavit is fatally defective if it fails to show the basis of the affiant’s personal knowledge of the stated facts. It did not address error preservation in Kerlin, Humphreys, or Brownlee, and the opinions of the intermediate appellate courts in these cases were silent on this point. Moreover, in the Texas Supreme Court cases cited above, the court either found multiple reasons to reject the affidavits, or the affidavit itself showed a lack of personal knowledge. See, e.g., Marks, 319 S.W.8d at 666 (statement from lawyer regarding his belief about prior lawyer’s intent based on review of case file is not an assertion of fact based on personal knowledge); Kerlin,
The Texas Supreme Court rarely discusses error preservation, but leaving the subject to the intermediate appellate courts has produced conflicting results. In the summary-judgment context, the language of Texas Rule of Civil Procedure 166a seems to indicate that one must object to a defective affidavit. Compare Tex.R. Civ. P. 166a(f) (“Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein,”) with id. (“Defects in the form of affidavits or attachments will not be grounds for reversal unless specifically pointed out by objection by an opposing party with opportunity, but refusal, to amend.”). The intermediate courts have concluded that a defect in the form of the
The courts of appeals — including this one — have cited Vaughan many times, specifically holding that a party must object to the affiant’s lack of personal knowledge and obtain a ruling in the trial court to preserve error. See, e.g., Hill v. Tootsies, Inc., No. 14-11-00260-CV,
We also followed Vaughan in Hou-Tex, Inc. v. Landmark Graphics,
Our sister court, the First Court of Appeals, also has cited Vaughan many times, specifically holding that to preserve error, one must object to the affiant’s lack of personal knowledge. See Rizkallah v. Conner,
We conclude that the better course is to hold that a litigant must object and obtain a ruling from the trial court to preserve a complaint that an affidavit fails to reveal the basis for the affiant’s personal knowledge of the facts stated therein. In reaching this conclusion, we have been guided chiefly by two considerations.
First, the Texas Supreme Court has stated that. “[i]f a precedent of this Court has direct application in a case, yet appears to rest on reasons rejected in some other line of decisions, [the lower court] should follow the case which directly controls, leaving to this Court the prerogative of overruling its own decisions.” Va. Indon. Co. v. Harris Cnty. Appraisal Dist.,
Second, this approach is consistent with the policy reasons behind error-preservation rules. The requirement that parties first raise their complaints in the trial court “conserves judicial resources by providing trial courts the opportunity to correct errors before appeal.” Id. (citing In re B.L.D.,
Here, IGuide’s special appearance was supported by an affidavit that did not reveal the basis of the affiant’s personal knowledge. Although the Shuttle Parties timely objected on this basis in the trial court, they- did not secure a ruling on their objection. We accordingly conclude that this complaint is waived. See id.
2. Failure to Deny that ¡Guide Markets Tours in Texas Through its Website
The Shuttle Parties further argue on appeal that Habte’s affidavit is inadequate to meet IGuide’s burden of proof because she did not deny that IGuide “markets tours in Texas through its website.” The Shuttle Parties produced affidavit testimony in the trial court that IGuide’s website “provides potential customers the opportunity to purchase tours through the website.” In her affidavit in
When a plaintiff relies on a nonresident defendant’s website as a basis for personal jurisdiction, we have evaluated the defendant’s Texas contacts according to a sliding scale in much the same way as the federal district court did in Zippo Manufacturing Co. v. Zippo Dot Com, Inc.,
Here, there is evidence only that IGuide “does not specifically target Texas with advertising” and that “potential customers [have] the opportunity to purchase tours through the website.” Unlike the cases on which the Shuttle Parties rely, there are no allegations or evidence in this case that the nonresident defendant established continuing internet relationships with Texas residents through its website. Cf. Patterson,
On this record, we conclude that “the level of interactivity and commercial nature of the exchange of information that occurs” on IGuide’s website does not show that IGuide has invoked the benefits and protections of Texas laws by purposefully availing itself of the privilege of conducting activities here. To the contrary, IGuide’s only “product” is a service that can be performed only in the Washington, D.C. area, and IGuide could not receive payment in Texas, because according to the uncontroverted evidence, it has no offices or bank accounts here. Finally, as previously mentioned, there is no allegation or evidence that IGuide actually has made a single sale over the internet to a person in Texas. Cf. I & JC Corp. v. Helen of Troy L.P.,
3.Failure to Deny that IGuide Markets Tours to Texas Residents When They Are Visiting Washington, D.C.
In a single sentence in their brief, the Shuttle Parties also complain that in her affidavit, Habte does not deny that in Washington, D.C., IGuide markets its services to tourists who are visiting from Texas. The Shuttle Parties cite no authority that personal jurisdiction can be based on such a contact in another state with a person who happens to reside in the forum state. This argument therefore is waived. See Tex.R.App. P. 38.1(i).
4.Reverse-Piercing of the Corporate Veil
The Shuttle Parties additionally assert that IGuide is subject to the trial court’s specific jurisdiction through the doctrine of reverse-piercing of the corporate veil. The Shuttle Parties did not allege in their petition that this was a basis for jurisdiction over IGuide. Cf. Kelly,
Under Texas law, a corporation is presumed to be a separate entity from its officers and shareholders. See Grain Dealers Mut. Ins. Co. v. McKee,
The Shuttle Parties do not contend that they produced evidence supporting this jurisdictional theory in the trial court. Instead, they assert that “[i]f [they] had been allowed to present the deposition testimony of [the IGuide Parties] or cross-examine them at the hearing on the Special Appearance,” then they would have produced evidence in support of this theory. They similarly contend that they “would have produced their own testimony” in support of this approach. They have not, however, identified any barrier that prevented them from introducing such evidence. They also did not ask the trial court for “a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had” as they were authorized to do under the rule governing special appearances. See Tex.R. Civ. P. 120a(3). We therefore conclude that this argument is without merit.
5. Appellants’ Contention that IGuide has Specific Jurisdiction as an Actor in Concert with Cook and Eshetu in Usurping a Corporate Opportunity of the Shuttle Parties
'' The Shuttle Parties also contend that the trial court has specific jurisdiction over IGuide because it is acting in concert with Cook and Eshetu “to further the scheme to steal away” the Shuttle Parties’ business opportunity. According to the Shuttle Parties, their causes of action against IGuide arise from its conspiracy with Cook and Eshetu to further those defendants’ breaches of contract and fiduciary duty.
The Shuttle Parties have not identified any act in furtherance of an alleged conspiracy that was committed by IGuide in Texas or through which it purposefully availed itself of the privilege of conducting activities in the forum state. Thus, the trial court did not err in rejecting this as a basis for jurisdiction. See, e.g., Nat’l Indus. Sand Ass’n,
We overrule the Shuttle Parties’ first issue.
F. Form of the Special-Appearance Order
In the alternative to their first issue, the Shuttle Parties argue that the trial court erred by stating in the order granting the special appearance that “Plaintiffs take
IV. Temporary Injunction
In their final issue, the Shuttle Parties argue that the trial court erred in denying in part their request for a temporary injunction. A temporary injunction is an extraordinary equitable remedy intended to preserve the status quo of the litigation’s subject matter pending a trial on the merits. Butnaru v. Ford Motor Co.,
A. Standard of Review
A trial court has broad discretion to grant or refuse a request for a temporary injunction, and we will not reverse such a ruling absent a clear abuse of discretion. See James v. Easton,
B. Irreparable Harm
Generally, to obtain a temporary injunction, the applicant must prove a valid cause of action against the defendant, a probable right to relief, and imminent, irreparable injury in the interim. Butna-ru,
A party seeking a temporary injunction must show a probable, imminent, and irreparable injury in the interim between the temporary-injunction hearing and the trial on the merits. Id, Probable injury includes elements of imminent harm, irreparable injury, and the absence of an adequate remedy at law for damages. Law v. William Marsh Rice Univ., 12B S.W.3d 786, 792 (Tex.App.-Houston [14th Dist.] 2003, pet. denied). Irreparable injuries are those for which the injured party cannot be adequately compensated by damages, or for which damages cannot be measured by any certain pecuniary standard. Butnaru,
The Shuttle Parties assert they have sustained irreparable harm for which there is no adequate remedy at law because “OnBoard Tours is a relatively new concern, and ... does not have an established and demonstrable history of profits,” and thus, money damages are difficult to ascertain. “OnBoard Tours,” however, consists of more than just the Shuttle. Parties. According to their own pleadings, the Shuttle Parties “are part of the network of companies that' do business as OnBoard Tours in New York City, Washington, DC, and Las Vegas,” but there are no allegations that Cook and Eshetu are wrongfully competing with any companies other than the Shuttle Parties, or in any city other than Washington, D.C. Thus, the assertion that there is no history of profits from the “network of companies” of which the Shuttle Parties are a part does not satisfy the burden to show that they cannot be adequately compensated by monetary damages.
Although the Shuttle Parties presented evidence that they have been conducting sightseeing tours in Washington, D.C. for six years, the Shuttle Parties provided no evidence of ticket sales or a change in the volume of customers or any other evidence of their economic condition, either before or after Cook and Eshetu began operating IGuide. See N. Cypress Med. Ctr. Operating Co.,
The Shuttle Parties point to the testimony of Victoria Taylor, the managing director of the company conducting sightseeing tours on their behalf,
In a temporary-injunction hearing, the burden is on the applicant to prove that the damages cannot be calculated, not for the opposing party to disprove the notion. See N. Cypress Med. Ctr. Operating Co.,
The Shuttle Parties also assert that Cook and Eshetu are likely unable to respond in damages to the claims asserted. They point to the record in which the trial court sustained relevancy objections to their questions to Cook about his current net worth and about whether he had a checking account in his name when he was employed by the Shuttle Parties. According to the Shuttle Parties, they were not allowed to put on this evidence to support their claim that they lacked an adequate remedy at law. To preserve for appellate review any error concerning the admissibility of evidence, an appellant must demonstrate that it either tendered the evidence or made a bill of exceptions. See Brown v. Am. Transfer & Storage Co.,
Under the applicable standard of review, we conclude that the trial court did not abuse its discretion by impliedly finding that the Shuttle Parties failed to prove that money damages would not adequately compensate them or that such damages
V. Conclusion
The trial court did not err in concluding that it lacked personal jurisdiction over IGuide, and the Shuttle Parties failed to preserve their complaint about the form of the order granting IGuide’s special appearance. The trial court also did not abuse its discretion by denying in part the Shuttle Parties’ request for injunctive relief. We accordingly affirm both of the trial court’s challenged rulings.
Justices BROWN, BOYCE, MeCALLY, and BUSBY join the En Banc Opinion authored by Justice CHRISTOPHER. Justice FROST issues an En Banc Dissenting Opinion in which Chief Justice HEDGES and Justice JAMISON join.
Notes
. Cook and Eshetu did not dispute the trial court's exercise of personal jurisdiction over them.
. See Parker v. Robert Ryan Realtors, Inc., No. 14-10-00325-CV,
. Kelly,
. Id.
. Id.
.
. Id.
. There the court stated as follows:
The sworn statement of one Larry Conwell states only "that he is personally familiar” with the following "facts”: "[t]he area proposed for annexation by defendant exceeds the statutory maximum one-half mile limitation,” and that the "boundary described by the metes and bounds contained in defendant's proposed ordinance does not close.” These conclusory averments would be insufficient even if set out in a separate affidavit. There is no indication that Larry Conwell is competent to testify as to either of these matters.
Laidlaw Waste Sys.,
. There, the court stated, "An affidavit which does not positively and unqualifiedly represent the facts as disclosed in the affidavit to be true and within the affiant’s personal knowledge is legally insufficient.” Hum-phreys,
. The court held that the affidavit of a listener to a radio station was inadequate to controvert an affidavit offered by the radio station where the listener’s affidavit failed to establish personal knowledge of the business practices of record companies or of the radio station. See Radio Station KSCS,
. The court explained that "[u]nless authorized by statute, an affidavit is insufficient unless the allegations contained therein are direct and unequivocal and perjury can be assigned upon it.” Brownlee,
. In Burke, an executrix submitted accounting supported by an affidavit that “was signed by her attorney and stated that he had 'read the accounting and allegations set out thereunder and same are true and correct to the best of his knowledge.’ ’’ Burke,
. See Tex.R. Civ. P. 166a(f) (“Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.”).
. In contrast, Habte’s affidavit shows that she was employed in a business in which she may well have gained personal knowledge of the asserted facts, and does not indicate that she lacked personal knowledge; it is simply silent ori the matter.
. See also Danevang Farmers Coop. Soc’y v. Indeco Prods., Inc., No. 13-04-445-CV,
. See Law Office of David E. Williams, II, P.C. v. Fort Worth Tex. Magazine Venture, LP, No. 02-10-00373-CV,
. See, e.g., Marin v. Herron, No. 04—11—00352-CV,
. See, e.g., Four D. Constr. Inc. v. Util. & Envtl. Servs., Inc., No. 05-12-00068-CV,
; See, e.g., Sundance Res., Inc. v. Dialog Wireline Servs., L.L.C., No. 06-08-00137-CV,
. See Calp v. Tau Kappa Epsilon Fraternity,
. See, e.g., Wolfe v. Devon Energy Prod. Co.,
. See, e.g., Athey v. Mort. Elec. Registration Sys., Inc.,
. See Fernandez v. Peters, No. 03-09-00687-CV,
. Dailey v. Albertson's, Inc.,
. Taylor testified that she is the managing director for "OnBoard Tours DC,” but that her job is functionally the same as Cook’s
. See Harley-Davidson Motor Co., Inc. v. Young,
Dissenting Opinion
dissenting.
This court should follow recent precedent from the Supreme Court of Texas sad conclude that an affidavit’s failure to affirmatively show how the affiant has personal knowledge of the statements contained therein is a defect of substance and that the appellants’ failure to obtain a ruling from the trial court regarding this defect does not preclude them from raising this issue on appeal. The evidence in the case under review, a single affidavit, is legally insufficient to support the trial court’s ruling on the special appearance, and the Supreme Court of Texas has held that this legal insufficiency can be raised for the first time on appeal.
Under recent Supreme Court of Texas precedent, the failure of an affidavit to affirmatively show the affiant has personal knowledge is a defect of substance.
Appellants/plaintiffs Washington DC Party Shuttle, LLC, Party Shuttle Tours, LLC, and Creativerse Internet Systems, LLC (collectively “the Shuttle Parties”) filed suit against appellees/defendants IGuide Tours, LLC, Tyree Cook, and Abise Eshetu (collectively “the IGuide Parties”). IGuide filed a special appearance challenging the trial court’s personal jurisdiction. In support of the special appearance, IGuide proffered as its only evidence a very brief affidavit from Sewunet Habte, an IGuide employee. In response, the Shuttle Parties argued, among other things, that the trial court should deny the special appearance because the only evidence IGuide submitted, the Habte affidavit, is insufficient and not competent because the affidavit does not show how
Under Texas Rule of Civil Procedure 120a, special-appearance affidavits “shall be made on personal knowledge, shall set forth specific facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify.”
In response to IGuide’s special appearance, the Shuttle Parties argued that the trial court should deny the special appearance because the Habte affidavit does not show how Habte has personal knowledge of the factual matters set forth in the affidavit. If this alleged defect is a defect in the form of the affidavit, then the Shuttle Parties failed to preserve error because they did not obtain a ruling from the trial court on this issue. For purposes of preservation of error, an appellate court treats a party’s objections to defects in the form and defects in the substance of an affidavit differently.
IGuide asserts that the Shuttle Parties waived the issue of whether the affidavit affirmatively shows how Habte has personal knowledge because this is a defect of form and the Shuttle Parties did not obtain an adverse ruling in the trial court. Notably, in its most recent pronouncements in this regard, the Supreme Court of Texas has treated this defect as a substantive one that renders the affidavit legally insufficient.
In prior cases this court has held that an affidavit’s failure to show how the affiant has personal knowledge is a defect of form, but these cases either pre-date or do not address the high court’s pronouncements in. Marks and Kerlin.
The trial court erred in concluding that IGuide satisfied its burden to negate personal jurisdiction.
Simply stating that the affiant has personal knowledge of the statements in the affidavit is inadequate unless the affidavit contains other statements that affirmatively reveal how the affiant has personal knowledge.
In the affidavit, Habte states that she is competent to make the affidavit and that she is employed by IGuide. Habte also states that “[t]he facts stated herein are of my personal knowledge, and I know them to be true and correct.” But, critically, Habte makes no other statements that arguably could be relevant to whether the affidavit affirmatively shows how Habte has personal knowledge of the statements contained in it. The affidavit submitted by the Shuttle Parties contained evidence that Habte is a former employee of Washington DC Party Shuttle, LLC. At the hearing on the special appearance, the Shuttle Parties’ counsel indicated that the Shuttle Parties knew Habte through her former employment and that Habte is “a $12-an-hour employee,” who is not an officer of IGuide. Counsel for IGuide responded by asserting that “[t]he fact that the affiant is only paid $12 an hour is irrelevant to the issue.”
In some contexts, an affiant’s position with a company, by itself, could be sufficient proof of the affiant’s personal knowledge. For example, this court has held that a statement that the affiant is president of the company asserting a claim on an account is sufficient to affirmatively show how the affiant has personal knowledge of the affidavit statements regarding the account.
By contrast, Habte does not state that she is an officer, director, or manager of IGuide. Habte simply states she is an IGuide employee, without identifying her position, describing her job duties, or providing any indication of the nature of her work or responsibilities at IGuide. Habte does not explain how she has personal knowledge regarding IGuide’s formation, members, contractual relationships, bank accounts, advertising, or any contacts IGuide might have with Texas. Affidavits with more information have been rejected as incompetent.
For example, in Lawrence Marshall Dealerships v. Meltzer, a car dealership sued one of its customers for breach of contract, and an issue in the case was the amount of the “payoff’ on a vehicle that the customer had “traded in” to the dealership.
In another case, this court held that the affidavit of a claims manager of an insurance company did not affirmatively show how the affiant had personal knowledge of the statements in the affidavit.
In today’s case, the Habte affidavit does not even rise to the level of the general manager’s affidavit found incompetent in Meltzer or the claims manager’s affidavit found incompetent in Valenzuela. Habte states only that she is an employee of IGuide and that she has personal knowledge of the facts stated in her affidavit. But, Habte does not so much as specify her position at IGuide. Though employment as an officer of a corporation might inherently provide the basis for personal knowledge regarding the corporation’s contacts with another state, employment in an unspecified position is not enough to affirmatively show how the affiant has per
Conclusion
This court should follow recent precedent from the Supreme Court of Texas and conclude that an affidavit’s failure to affirmatively show how the affiant has personal knowledge of the statements contained therein is a defect of substance and that the Shuttle Parties’ failure to obtain a ruling from the trial court regarding this defect does not preclude them from raising this issue on appeal. Because the complaint regarding personal knowledge that the Shuttle Parties asserted in the trial court and on appeal is valid, the Habte affidavit — the only evidence proffered by IGuide — is legally insufficient. Thus, the evidence is legally insufficient to support the trial court’s ruling on the special appearance, and this court should reverse the trial court’s order and remand to the trial court for rendition of an order that IGuide’s special appearance be denied. Because the en banc majority does not do so, I respectfully dissent.
. See Office of Atty. Gen. of Texas v. Burton,
. Tex.R. Civ. P. 120a(3).
. See Tex.R. Civ. P. 166a(f) (stating that "[supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein"); Urban v. Barker, No. 14-06-00387-CV,
. See Urban,
. See id.
. See Anderson v. Snider,
. See Burton,
. See Marks v. St. Luke’s Episcopal Hosp.,
. See Marks,
. See Kerlin,
. See
. See Hopkins v. Spring Indep. Sch. Dist.,
. See Hill v. Tootsies, Inc., No. 14—11—00260-CV,
. See Marks,
. See Urban,
. See Southtex 66 Pipeline Co., Ltd. v. Spoor,
. See Valenzuela,
. See Valenzuela,
. See Requipco v. Am-Tex Tank & Equipment, Inc.,
. See M.G.M. Grand Hotel, Inc. v. Castro,
. See id.
. See No. 14-07-00920-CV,
. See id. at *1, 4.
. See id. at *4.
. See id.
. See Valenzuela,
. See id. at 554.
. See id. at 554-55.
. See Marks,
. See Walker Ins. Servs. v. Bottle Rock Power Corp.,
