Case Information
*0 FILED IN 3rd COURT OF APPEALS AUSTIN, TEXAS 10/21/2015 5:48:53 PM JEFFREY D. KYLE Clerk NO. 03-15-00497-CV THIRD COURT OF APPEALS 10/21/2015 5:48:53 PM JEFFREY D. KYLE AUSTIN, TEXAS 03-15-00497-CV *1 ACCEPTED [7485009] CLERK IN THE COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS, AT AUSTIN, TEXAS
KAREN E. LANDA,
Appellant
v.
CHARLES L. FARRIS,
Appellee. On Appeal from the 98 th Judicial District Court, Travis County Honorable Judge Triana Presiding APPELLANT’S BRIEF
HANCE SCARBOROUGH LLP
Terry L. Scarborough
State Bar No. 17716000
TScarborough@hslawmail.com
V. Blayre Pena
State Bar No. 24050372
BPena@hslawmail.com
400 W. 15 th Street, Ste. 950
Austin, TX 78701
Telephone: (512) 479-8888
Facsimile: (512) 482-6891
A TTORNEYS FOR A PPELLANT
K AREN E. L ANDA
O RAL A RGUMENT R EQUESTED *2
I. IDENTITY OF PARTIES AND COUNSEL Pursuant to Texas Rule of Appellate Procedure 38.1(a), the parties to the judgment at issue in this appeal are:
APPELLANT ATTORNEYS FOR APPELLANT
Karen E. Landa Trial and Appellate Counsel
Terry L. Scarborough V. Blayre Pena Hance Scarborough LLP 400 W. 15 th Street, Ste. 950 Austin, Texas 78701 APPELLEE ATTORNEYS FOR APPELLEE
Charles L. Farris Trial and Appellate Counsel
Guillermo Ochoa-Cronfel The Cronfel Firm 2700 Bee Cave Rd., Ste. 103 Austin, Texas 78746 ii
II. TABLE OF CONTENTS I. IDENTITY OF PARTIES & COUNSEL …………………….……………..ii
II. TABLE OF CONTENTS ……………………………………………………iii
III. INDEX OF AUTHORITIES …………………………………………….iv, v
IV. STATEMENT OF THE CASE …………………………………………….vi
V. STATEMENT REGARDING ORAL ARGUMENT ……………………..vii
VI. ISSUES PRESENTED…………………………………………………….viii
VII. STATEMENT OF THE FACTS ……………………..……………………..1
A. Background Information about Landa……………………………………1 B. Facts Related to the Transaction in Dispute ……………………………...2 C. Other Intermittent Contacts with Texas After Transaction until Suit Filed……………………………………………………………4 D. Procedural History………………………………………………………..5
VIII. SUMMARY OF THE ARGUMENT……………………………….……… . 6
IX. ARGUMENT AND AUTHORITIES……...………………………..……….7
A. Standard of Review……………………………………………………….7 B. The Texas long-arm statute…………........................................................8 C. Farris failed to meet his initial burden to bring Landa under the Texas long-arm statute (Issue 1) ……………………………..…………………8 D. The trial court does not have specific jurisdiction over Landa (Issue 2)………………………………………………………….……...10 E. The trial court does not have general jurisdiction over Landa (Issue 3)…………………………………………………………….…...16 X. CONCLUSION………………………………………………………………..19
CERTIFICATE OF COMPLIANCE……………………………………………...21
CERTIFICATE OF SERVICE …………………………………………..….……22
APPENDIX………………………………………………………………………. .
iii *4 III. INDEX OF AUTHORITIES Cases
Argo Data Res. Corp. v. Shagrithaya , 380 S.W.3d 249 (Tex. App.—Dallas 2012,
pet. denied) .................................................................................................... 14, 15 BMC Software Belg., N.V. v. Marchand , 83 S.W.3d 789 (Tex. 2002) ..................7, 8
Burger King Corp. v. Rudzewicz , 471 U.S. 462 (1985) ........................................... 11
Citrin Holdings, L.L.C. v. Minnis , 305 S.W.3d 269 (Tex. App.—Houston [14th
Dist.] 2009, no pet.) ......................................................................................... 12 , 13 CSR, Ltd. v. Link , 925 S.W.2d 591 (Tex. 1996) ............................................... 10, 16
Daimler AG v. Bauman , 132 S. Ct. 746 (2014) .................................................. 7, 16
Goodyear Dunlop Tires Operations, S.A. v. Brown , 131 S. Ct. 2846 (2011) .. 16, 17
Helicopteros Nacionales de Colombia, S.A. v. Hall , 466 U.S. 408 (1984) ............. 10
Johnston v. Multidata Systems Intern’l Corp. , 523 F.3d 602 (5th Cir. 2008) ......... 17
Kelly v. General Interior Constr. Inc. , 301 S.W.3d 653, (Tex. 2010) .............. 7, 8, 9
Locke v. Ethicon, Inc ., 58 F. Supp. 3d 757 (S.D. Tex. 2014) .................................. 17
Mi Gwang Contact Lens Co. v. Chapa , 2015 Tex. App. LEXIS 5872 (Tex. App.—
Corpus Christi 2015, no pet. h.) ........................................................................... 17 Michiana Easy Livin’ Country, Inc. v. Holten , 168 S.W.3d 777 (Tex. 2005) ......... 10
Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569 (Tex. 2007) .................... 10
Monkton Ins. Servs., Ltd. v. Ritter , 768 F.3d 429 (5th Cir. 2014) ........................... 17
PHC-Minden, L.P. v. Kimberly-Clark Corp ., 235 S.W.3d 163
(Tex. 2007)…………………………………………………………………7, 16, 17
Pillai v. Pillai , 2015 Tex. App. LEXIS 2446 (Tex. App.—Amarillo 2015, no pet.)
(mem. op.) ................................................................................................ 11, 13, 14 Retamco Operating Inc. v. Republic Drilling, Inc. , 278 S.W.3d 333 (Tex. 2009) .. 11
iv
Turner Schilling, L.L.P. v. Gaunce Mgmt. , 247 S.W.3d 447 (Tex. App.—Dallas
2008, no pet.) ........................................................................................................ 12 Waterman S.S. Corp. v. Ruiz , 355 S.W.3d 387 (Tex. App.—Houston [1st Dist.]
2011, pet. denied) ................................................................................................... 8 Statutes
Tex. Civ. Prac. & Rem. Code §§17.041-.045 ............................................................ 8
v *6 IV. STATEMENT OF THE CASE
Nature of Case: Charles L. Farris (“Farris” or “Appellee”) is an individual
residing in Travis County, Texas who brought suit against Karen E. Landa (“Landa” or “Appellant”), a resident of Iowa, alleging breach of contract and fraud in relation to money given by Farris to Landa to make a down payment on a home, located in West Des Moines, Iowa, purchased by Landa. Landa subsequently filed a Special Appearance challenging the trial court’s jurisdiction over her. The Honorable Gisela Triana of the 200 th Judicial District
Trial Court:
Court, Travis County, Texas.
Trial Court’s Actions: The trial court denied Landa’s Special Appearance.
vi *7 V. STATEMENT REGARDING ORAL ARGUMENT Landa requests oral argument. Oral argument would assist this Court in understanding the underlying facts of the case and how the governing law should
apply to them as the trial court declined to issue findings of fact and conclusions of
law.
vii
VI. ISSUES PRESENTED
The issues presented on appeal are as follows:
1. The trial court erred in holding that Farris met his initial burden to bring Landa under the Texas long-arm statute.
2. The trial court erred in finding that it has specific jurisdiction over Landa. 3. The trial court erred in finding that it has general jurisdiction over Landa. [1] *9 TO THE HONORABLE THIRD COURT OF APPEALS:
This appeal arises out of the Trial Court’s decision to deny Karen E. Landa’s (“Landa”) special appearance, when Charles L. Farris (“Farris”) failed to plead
sufficient facts demonstrating the court had jurisdiction, and when the evidence
conclusively established Landa is an Iowa resident and the dispute concerned
property located in Iowa. Deciding the court has jurisdiction over Landa violates all
notions of fair play and due process, and as such, the Trial Court’s ruling should be
reversed.
VII. STATEMENT OF THE FACTS This lawsuit concerns allegations by Farris that Landa breached a contract and committed fraud in relation to money Farris provided to Landa for the purchase of
real property in Iowa. [2] Specifically, in February 2011 Farris gave Landa money to
serve as the down payment on a house she purchased in West Des Moines, Iowa that
same month. [3]
A. Background Information about Landa
Landa is an individual who resides in Urbandale, Iowa and is thus a nonresident defendant. [4] Farris and Landa are former spouses, having been married
*10 from approximately 1985 to 1991. [5] Farris and Landa have one child together (a son),
and Farris also adopted Landa’s daughter from a prior marriage. [6]
Landa moved to Texas from Iowa in 1978 [7] and lived in either Travis County or Williamson County from 1978, until the summer of 2010. [8] In the summer of 2010
Landa left Austin to reside in Michigan until September 2010, at which point she
traveled to New York where she resided until late October 2010. [9] On or about
November 1, 2010, Landa moved to Des Moines, Iowa to reside with her mother
who was suffering from terminal cancer. [10] Landa continued to reside in Iowa at all
relevant times to this dispute. Landa intended to keep her residence in Iowa as
demonstrated by the fact that she filed state tax returns in Iowa for the last five
years. [11]
B. Facts Related to the Transaction in Dispute
On December 17-19, 2010, Landa traveled to Dallas, Texas, to spend the weekend with Farris at the suggestion of Farris. [12] During this weekend the parties
generally discussed the possibility of Farris providing a down payment to assist
*11 Landa in purchasing a house in Iowa. [13] However, per Farris’s testimony, the focus
of the weekend was not to discuss the money, but “just to get together and enjoy
each other’s company and have a good time in Dallas.” [14]
During this meeting, the parties did not discuss a specific amount of money, a specific house, or any loan terms. [15] It was not until Landa returned to Iowa that
she chose a house. [16] Farris subsequently agreed to provide the down payment for
the house. [17] No written agreement, such as re-payment terms, interest rate, or place
of payment, was entered into between Farris and Landa, and Farris has failed to
introduce any evidence to the contrary.
In order to qualify for financing, Farris and Landa were required to open a joint checking account with Bankers Trust in Iowa, which they did. [18] On February
24, 2011, Farris transferred $22,179.86 to the Iowa Bankers Trust joint checking
account. [19] On February 25, 2011, Farris transferred $67,000.00 to the Iowa Bankers
Trust joint checking account. [20] Landa closed on the house in Iowa on February 28,
2011. [21] On April 21, 2011, Landa mailed a copy of the warranty deed for the house,
*12 along with other closing documents, to Farris. [22] The documents were deposited into
a mailbox in West Des Moines, Iowa. [23] Landa resided in the house in Iowa until
selling it in July 2013. [24] In sum, every important facet of the transaction in question
occurred in Iowa.
C. Other Intermittent Contacts with Texas After Transaction until Suit
Filed
Landa’s only contacts with Texas after the transaction in dispute are as follows:
In February 2012, Landa traveled to Texas to attend a ceremony in Farmersville, Texas to bury her mother’s ashes at a family grave. [25]
On the weekend of May 12, 2012, Landa traveled to Austin, Texas to attend the 80 th birthday party of a close friend. [26] While in Austin during this trip, Landa hand delivered a check to Farris for $15,000.00 because he had informed Landa that he needed some financial assistance. [27]
In June 2013, Landa traveled to Austin to interview for a potential job in furtherance of possibly moving back in an attempt to reconnect with her son. [28] *13 On August 1, 2013, and for approximately eight months, Landa temporarily stayed in Travis County for the purpose of trying to reconnect with her children, and to hopefully participate in her son’s upcoming wedding. [29] However, Landa left the majority of her personal belongings in Iowa because she did not know how long she was going to stay. [30] Landa did not purchase or lease a house, but instead stayed at a friend’s house in Lakeway, Texas. [31]
In order to have income during her stay in Travis County, Landa, for a brief period, sold insurance in Texas. [32] Landa maintains a nonresident insurance license in Texas, although she has not engaged in selling insurance in Texas since spring of 2014. [33]
In April 2014, Landa moved back to Iowa, where she has resided ever since. [34]
Landa has no other significant contacts with Texas over the last five years except for
those set forth above.
D. Procedural History
On November 7, 2014, after Landa moved back to Iowa, Farris filed suit against Landa alleging breach of contract and fraud, in relation to money given to
*14 Landa. [35] Landa was served at her residence in Urbandale, Iowa. Landa filed a
Special Appearance challenging the trial court’s personal jurisdiction over her. [36] An
evidentiary hearing was held on Landa’s Special Appearance on July 2, 2015. [37] On
July 21, 2015, the Trial Court issued an order denying Landa’s Special
Appearance. [38] Although Landa requested findings of fact and conclusions of law,
none were entered. [39] Landa subsequently filed a Notice of Appeal on August 6,
2015. [40]
VIII. SUMMARY OF THE ARGUMENT The trial court committed three reversible errors in denying Landa’s special appearance. First, the trial court erred in holding that Farris met his initial burden to
allege sufficient facts to bring Landa within the reach of the Texas long-arm statute.
Farris’s First Amended Petition does not contain sufficient allegations to bring
Landa within the trial court’s jurisdiction, and as such the trial court should have
granted Landa’s special appearance when Landa established that she is a nonresident
of Texas.
Second, the alleged liability in this case does not arise from any of Landa’s contacts with the forum, and thus the trial court does not have specific jurisdiction
*15 over Landa. Accordingly, the trial court erred to the extent that its denial of Landa’s
special appearance is based on a finding of specific jurisdiction.
Third, Texas has historically imposed a very high standard to find general jurisdiction, and the United States Supreme Court has recently all but shut the door
on general jurisdiction based on a defendant’s contacts with the forum, when those
contacts are not related to the claim. See, e.g., Daimler AG v. Bauman , 132 S. Ct.
746 (2014); PHC-Minden, L.P. v. Kimberly-Clark Corp. , 235 S.W.3d 163 (Tex.
2007). The evidence in this matter shows that Landa’s general contacts with the
forum come nowhere near meeting the high standard required for such a finding.
Accordingly, the trial court erred to the extent that its denial of Landa’s special
appearance is based on a finding of general jurisdiction.
IX. ARGUMENT AND AUTHORITIES
A. Standard of Review
Whether a court has personal jurisdiction over a defendant is a question of law that is reviewed de novo. BMC Software Belg., N.V. v. Marchand , 83 S.W.3d 789,
794 (Tex. 2002); see also Kelly v. General Interior Constr. Inc. , 301 S.W.3d 653,
658 (Tex. 2010). Before determining the jurisdictional question, the trial court must
frequently resolve questions of fact. Id . If a trial court does not issue findings of
fact and conclusions of law with its special appearance ruling, all facts necessary to
support the judgment and supported by the evidence are implied. Id . at 795.
However, when the appellate record includes the reporter’s and clerk’s records, these
implied findings are not conclusive and may be challenged for legal and factual
sufficiency on appeal. Id . To the extent that the underlying facts are undisputed, the
Court of Appeals conducts a de novo review. Waterman S.S. Corp. v. Ruiz , 355
S.W.3d 387, 402 (Tex. App.—Houston [1st Dist.] 2011, pet. denied).
Here, findings of fact and conclusions of law were requested, but not entered.
The reporter’s record and clerk’s record have been filed, and as such, any potential
implied findings are not conclusive in this case.
B. The Texas long-arm statute.
The Texas long-arm statute governs Texas courts’ exercise of jurisdiction over nonresident defendants. Tex. Civ. Prac. & Rem. Code §§17.041-.045.
However, while the language of this statute is broad, it is limited by the federal
constitutional requirements of due process. BMC Software , 83 S.W.3d at 795. Thus,
Texas courts rely on precedent from the United States Supreme Court and other
federal courts, as well as their own decisions, in determining whether a nonresident
defendant has negated all bases of alleged jurisdiction. Id . at 795-96.
C. Farris failed to meet his initial burden to bring Landa under the Texas
long-arm statute (Issue 1).
A plaintiff bears the initial burden to plead sufficient allegations to bring a nonresident defendant within the reach of the Texas long-arm statute (i.e. that the
defendant committed a tort in Texas or conducted business in Texas). See Kelly ,
301 S.W.3d at 658-59. If a plaintiff does not allege a sufficient basis for personal
jurisdiction over the defendant, then the defendant need only prove that she is a
nonresident to negate jurisdiction. Id . Because Farris failed to meet his initial
burden, Landa’s special appearance should have been granted.
Farris’s First Amended Petition contains no allegations that Landa committed a tort in Texas. [41] Similarly, it contains no allegations that Landa conducted business
in Texas as to the transaction in question. To the contrary, the vast majority of the
“facts” alleged in Farris’s First Amended Petition admit that the relevant issues in
this case occurred in Iowa. For example, Plaintiff admits that the house to be
purchased was in Iowa, that the lender was in Iowa and that he wired money to a
joint bank account in Iowa. [42] The only mention of any activity related to the
transaction that occurred in Texas is a brief initial meeting in Dallas between the
parties (during which no agreement was entered into, as set forth in more detail
below) and some of Farris’s alleged contractual obligations, which are irrelevant,
such as his allegation that he liquidated a CD with his bank in Austin to fund the
transfer and that he sent the funds to Iowa from a bank in Austin. [43]
*18 Accordingly, Farris failed to meet his initial burden as his allegations do not sufficiently allege a basis for personal jurisdiction over Landa. Thus, Landa negated
personal jurisdiction when she affirmed that she is not a resident of Texas. [44] The
trial erred when it did not grant Landa’s special appearance on this basis. [45]
D. The trial court does not have specific jurisdiction over Landa (Issue 2).
Specific jurisdiction is defined as jurisdiction “arising out of or related to the defendant’s contacts with the forum.” Helicopteros Nacionales de Colombia, S.A.
v. Hall , 466 U.S. 408, 414 n.8 (1984); see also CSR, Ltd. v. Link , 925 S.W.2d 591,
595 (Tex. 1996). In other words, there must be "a substantial connection between
[the nonresident's contacts with the forum] and the operative facts of the
litigation." Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 585 (Tex.
2007). Specific jurisdiction is not established merely by allegations or evidence that
a nonresident committed a tort in the forum state or "directed a tort" at the forum
state. Michiana Easy Livin’ Country, Inc. v. Holten , 168 S.W.3d 777, 790-92 (Tex.
2005). Instead, the touchstone is whether the Landa purposefully availed herself of
conducting activities within the forum state, thus invoking the benefits and
*19 protections of its law. Retamco Operating Inc. v. Republic Drilling, Inc. , 278
S.W.3d 333, 338 (Tex. 2009).
Whether the touchstone has been met does not turn on the “application of mechanical tests or conceptualistic theories relating to the place of contracting or of
performance.” Pillai v. Pillai , 2015 Tex. App. LEXIS 2446, *4-5 (Tex. App.—
Amarillo 2015, no pet.) (mem. op.). “Rather, the approach must be ‘highly realistic,’
and, under it, the contract’s creation is normally an intermediate step serving to tie
prior business negotiations with future consequences which themselves are the real
object of the business transaction.” Id ., citing Burger King Corp. v. Rudzewicz , 471
U.S. 462, 105 (1985). “So, it is the indicia of prior negotiations and contemplated
future consequences, along with the terms of the contract and the parties’ actual
course of dealing that are evaluated when assessing if the defendant purposefully
established minimum contacts within the forum.” Id .
Looking to Farris’s pleadings, which define the scope of the jurisdiction inquiry, Farris alleged that the Court has jurisdiction because “Defendant conducted
business with Plaintiff in Austin. Plaintiff and Defendant entered into an agreement
whereby Plaintiff would loan Defendant money towards the purchase of a house,
and Plaintiff was to perform his obligations…in whole or in part in the state.” [46] This
allegation illustrates the fundamental flaw in Farris’s specific jurisdiction argument
*20 and why the trial court does not have specific jurisdiction over Landa. Specifically,
Farris’s focus, both in his pleading and at the hearing on this matter, is on his own
contacts with forum, not Landa’s. However, it does not matter that Farris was to
conduct his obligations in the state. See Turner Schilling, L.L.P. v. Gaunce Mgmt. ,
247 S.W.3d 447 (Tex. App.—Dallas 2008, no pet.) (“the plaintiff’s performance of
part of its contact duties in Texas is not a purposeful contact of the defendant with
Texas.”).
As set forth above, when determining specific jurisdiction the focus is on whether the liability arose out of the defendant’s contacts with the forum, not the
plaintiff’s. The lack of specific jurisdiction becomes more apparent when reviewing
cases where specific jurisdiction was found versus cases where it was not found.
In Citrin Holdings , a case relied on by Farris, the court found that specific jurisdiction existed over a nonresident defendant. Citrin Holdings, L.L.C. v. Minnis ,
305 S.W.3d 269, 278-279 (Tex. App.—Houston [14th Dist.] 2009, no pet.).
However, that case is easily distinguishable. Citrin Holdings concerned a
partnership agreement where 1) the nonresident defendant traveled to Texas multiple
times over a period of months to have face-to-face meetings with a Texas resident,
2) a partnership document was drafted in Texas and signed in Texas, and 3) the
partnership agreement specifically contemplated that the plaintiff would develop
potential projects for the partnership in Texas and would participate in management
of the partnership in Texas. Id . at 282-84. Thus, the court held that the defendant
had purposefully availed himself of conducting business in Texas.
Here, Landa did not have multiple face to face meetings in Texas over a period of months to negotiate the “loan.” There was no loan agreement drafted in Texas or
anywhere. The performance and purpose of the loan took place in Iowa when the
parties opened a bank account in Iowa, the money was deposited into that account
in Iowa, and the property was purchased in Iowa.
By way of contrast to Citrin Holdings , in a recent case out of the Amarillo Court of Appeals, the trial court’s finding of specific jurisdiction was overturned.
Pillai , 2015 Tex. App. LEXIS 2446. In Pillai , two brothers entered into a loan
agreement whereby the brother who lived in Texas loaned his brother, who lived in
Canada, money to purchase a house in Canada. Id . at *1-2. To document the loan,
they entered into a written contract which required repayment in monthly
installments in Amarillo and that the contract would be construed under Texas law.
Id . at *2. Further, the Canadian brother visited his brother in Texas several times,
though none of trips were related to the loan. Id . at *6. The Court of Appeals
ultimately held that a court must use a “highly realistic” approach when determining
specific jurisdiction which “focuses not only on prior negotiations and contemplated
future consequences, but also the terms of the contract and the parties’ actual course
of dealings.” Id . at *8.
Using that approach, the court held that an agreement to send payments to an address in Texas and a commitment that a written note be construed in accordance
with Texas law was not the stuff of purposeful availment so as to establish specific
jurisdiction. Id . The Court also noted that plaintiff residing in Texas was of no
relevance. Id .
When looking at the case at hand, Pillai is more analogous than Citrin Holdings . The sum total of the links between Landa, the transaction, and Texas, is
that Landa and Farris met in Dallas for two days at which point there was some
general discussion of Farris giving her some money. However, the contacts in this
case are even further removed than those in Pillai , when there was no loan agreement
drafted or entered into, there was no specific requirement to make payments in
Texas, and there was no agreement of the applicability of Texas law.
Furthermore, as to the meeting in Dallas, there is no evidence that a contract was entered into at that meeting. For a contact to be formed, the minds of the parties
must meet with respect to the subject matter of the agreement and all of its essential
terms. See, e.g., Argo Data Res. Corp. v. Shagrithaya , 380 S.W.3d 249, 275 (Tex.
App.—Dallas 2012, pet. denied). The parties must assent to the same thing in the
same sense at the same time. Id . Their assent must comprehend the whole
proposition, and the agreement must comprise all of the terms that they intend to
introduce into it. Id . Additionally, the legal obligations and liability of the
parties must be sufficiently definite. Id .
Here, even assuming everything Farris stated or pleaded is true, there could have been no contract entered into in Dallas because the Parties did not know the
amount, the house, or even if a house would be purchased. [47] Thus, there could not
have been a meeting of the minds on the essential terms of a contract in Dallas.
Even assuming arguendo that a contract was entered into, it was entered into in Iowa once the terms became more definite and not in Dallas. This is demonstrated
by the fact that Landa was in Iowa when: (1) she chose the house that would be
purchased; (2) decided how much money would be needed; and (3) all negotiations
with the lender took place. [48] Further, the funds were wired to a bank account in
Iowa, [49] the house was purchased in Iowa [50] and the transaction was closed in Iowa. [51]
All the operative facts, therefore occurred in Iowa, and this case falls under the same
category as the Pillai case, as opposed to the Citrin Holdings case. Since the contacts
in Pillai , which were more than here, were not enough to establish specific
jurisdiction, it is error to find specific jurisdiction in this case. Accordingly, the Trial
Court’s finding of jurisdiction should be reversed.
*24 E. The trial court does not have general jurisdiction over Landa (Issue 3).
General jurisdiction exists when the claims do not arise out of and are not related to the activities in the forum state, but the nonresident defendant has
continuous and systematic contacts with the forum state. See PHC-Minden , 235
S.W.3d at 168. In the case of general jurisdiction, the Court must find that the
defendant’s contacts with the forum are so “continuous and systematic” that an
exercise of jurisdiction is warranted even though the claim does not arise out of those
contacts. This involves a more demanding standard that specific jurisdiction. CSR,
Ltd. , 925 S.W.2d at 595.
Further, the Supreme Court of the United States has all but shut the door on general jurisdiction, when the alleged contacts are not related to the claims at issue.
In Daimler AG v. Bauman , the Supreme Court established a strict and clear standard
for general jurisdiction over a non-resident by stating that it is permissible “only
when the [Defendant’s] affiliations with the state in which suit is brought are so
constant and pervasive ‘as to render it essentially at home in the forum state.’” 2014
132 S. Ct. at 751 (emphasis added), quoting Goodyear Dunlop Tires Operations,
S.A. v. Brown , 131 S. Ct. 2846, 2851 (2011). It also noted that general jurisdiction
requires affiliation with the forum that is “comparable to a domestic enterprise in
that [s]tate.” Id. at *31, n. 11, citing Goodyear , 131 S. Ct. at 2851. The Fifth Circuit
subsequently opined on the difficulty of establishing general jurisdiction stating, “It
is … incredibly difficult to establish general jurisdiction in a forum other than the
place of incorporation or principal place of business.” Monkton Ins. Servs., Ltd. v.
Ritter , 768 F.3d 429, 432 (5th Cir. 2014). [52] Note that while the Daimler and
Goodyear cases both involved corporate defendants, nothing in those opinions
would suggest that the same clear and high standard is not equally applicable in the
case of an individual. In fact, in the Goodyear case the Court noted in its opinion
that “[f]or an individual, the paradigm forum for the exercise of general jurisdiction
is the individual’s domicile.” 131 S. Ct. at 2846.
These cases make clear that it is only in extremely rare cases that a court should find general jurisdiction, which has been the longstanding position of both
the Fifth Circuit and the Texas Supreme Court. See, e.g., Johnston v. Multidata
Systems Intern’l Corp. , 523 F. 3d 602 (5th Cir. 2008) (“Before we apply these
principles to this case, it is worthwhile to review past cases to illustrate just how
difficult it is to establish general jurisdiction.”); PHC-Minden , 235 S.W.3d at 163
(a general jurisdiction analysis requires a “more demanding minimum contacts
analysis” with a “substantially higher threshold.”).
*26 Farris pleaded that “The Court has jurisdiction over Defendant as a result of her continuous and systematic contacts, both personal and professional, with Austin,
Travis County, Texas, for well over twenty (20) years, up to an including the time
this suit was filed.” [53] This is not a true statement.
As set forth by the evidence, since 2010 Landa only had limited and intermittent contacts with Texas, and has had none since spring 2014, well before
this lawsuit was filed. She is domiciled in Iowa. Landa lived and worked in Iowa,
and has done so for the past five years, other than the short period of time she spent
in Travis County trying to reconnect with her son. [54] Furthermore, Landa filed state
income tax returns for the last five years, [55] demonstrating her intent to remain in
Iowa. She does not currently engage in any business in Texas. Looking to the clear
guidance provided by the Supreme Court, it cannot be said that Landa’s former
contacts with Texas make her at home in the forum. Accordingly, the trial court did
not have general jurisdiction over Landa, and Landa’s special appearance should
have been granted.
X. CONCLUSION
As established herein, Farris did not plead sufficient facts to bring Landa under the Texas long-arm statue, and the trial court should have granted Landa’s
special appearance based on her testimony that she is not a resident of Texas.
However, even had Farris pleaded sufficient facts, the evidence established that the
Court does not have specific jurisdiction over Landa because the alleged liability of
Landa does not arise out of and is not related to her contacts with the forum.
Similarly, general jurisdiction does not exists because Landa does not have such
systematic and continuous contacts so as to render her at home in the forum.
As Landa negated all bases of alleged jurisdiction, the trial court should have found that it does not have personal jurisdiction over Landa, and granted her Special
Appearance. The failure to do so constitutes reversible error. Accordingly, Landa
requests that the court reverse the Trial Court’s order denying Landa’s Special
Appearance, and dismiss this case in its entirety. Landa requests such other and
further relief to which she may be entitled.
Respectfully submitted, H ANCE S CARBOROUGH , LLP 400 W. 15 th Street, Ste. 950 Austin, Texas 78701 Telephone: (512) 479-8888 Facsimile: (512) 482-6891 By: /s/ Terry L. Scarborough Terry L. Scarborough State Bar No. 17716000 tscarborough@hslawmail.com V. Blayre Pena State Bar No. 24050372 bpena@hslawmail.com *29 CERTIFICATE OF COMPLIANCE Pursuant to Texas Rule of Appellate Procedure 9.4, I hereby certify that this brief contains 4383 words. This is a computer generated document created in
Microsoft Word, using 14 point typeface for all text, except for footnotes, which are
in 12-point typeface. In making this certificate of compliance, I am relying on the
word count provided by the software used to prepare the document.
/s/ Terry L. Scarborough Terry L. Scarborough *30 CERTIFICATE OF SERVICE I hereby certify that a copy of Appellants’ Brief was served on the following counsel of record on October 21, 2015, via certified mail, return receipt requested,
and/or the electronic filing system:
Counsel for Charles L. Farris
The Cronfel Firm
Guillermo Ochoa-Cronfel
2700 Bee Cave Rd.
Austin, Texas 78746
(512) 347-9600 Phone
(512) 347-9911 Fax
/s/ Terry L. Scarborough Terry L. Scarborough
APPENDIX
1. Order Denying S pecial Appearance of Defendant, Karen E. Landa *32 APPENDIX
1
[1] The trial court’s order denying Landa’s special appearance does not specify whether the court found that it had specific or general jurisdiction over Landa (or both). As such, this appeal addresses how a finding of either constitutes reversible error by the trial court. viii
[2] Clerk’s Record (“CR”) pp. 15-19.
[3] CR p. 4. Whether the money was a gift or a loan is an issue in dispute.
[4] See CR p. 3; CR pp. 9-11; See also Reporter’s Record (“RR”) p. 80. Note that all citations to specific pages of the Reporter’s Record shall refer to Volume 2 of the Reporter’s Record, and that all references to exhibits shall be Volume 3.
[5] RR p. 96.
[6] RR p. 48.
[7] RR p. 32.
[8] RR p. 34.
[9] RR pp. 37-39.
[10] RR p. 39.
[11] RR pp. 62-63; RR Landa’s Exhibits 1-4.
[12] RR pp. 49-50.
[13] RR pp. 50-51
[14] RR pp. 116-17.
[15] RR p. 116.
[16] RR p. 99.
[17] RR pp. 51-52.
[18] RR pp. 66-67; CR p. 17.
[19] RR p. 102 and RR Farris’s Exhibit 6.
[20] RR p.102 and RR Farris’s Exhibits 6 and 7.
[21] RR p. 68.
[22] RR p. 56.
[23] RR Farris’s Exhibit 8.
[24] RR p. 80
[25] RR p. 56.
[26] RR p. 57-58.
[27] RR p. 58.
[28] RR p. 58-59
[29] RR p. 42.
[30] RR p. 59.
[31] Id .
[32] RR pp. 44-45.
[33] RR p. 35 and 44-46.
[34] RR p. 60.
[35] CR pp. 4-7.
[36] CR pp. 9-11.
[37] RR p. 1.
[38] CR p. 31.
[39] CR pp. 37-38.
[40] CR p. 32.
[41] CR pp. 15-21.
[42] CR p. 17.
[43] Id .
[44] CR pp. 9-11.
[45] The trial court did not rule on this issue during the hearing, instead opting to carry the issue and to continue with hearing under the trial court’s assumption that the plaintiff had met his burned. RR p. 31. Thus, the court’s denial of Landa’s special appearance indicates that it ultimately found that the Farris met his initial burden.
[46] CR p. 16.
[47] RR p. 116.
[48] RR p. 52.
[49] CR p. 17.
[50] Id .
[51] RR p. 30.
[52] This precedent has also been cited to by Texas Federal Court and Texas State Courts in finding no general jurisdiction. See, e.g., Locke v. Ethicon, Inc ., 58 F. Supp. 3d 757, 762 (S.D. Tex. 2014); Mi Gwang Contact Lens Co. v. Chapa , 2015 Tex. App. LEXIS 5872, *14-15 (Tex. App.—Corpus Christi 2015, no pet. h.).
[53] CR p. 16.
[54] RR p. 80.
[55] RR pp. 62-63; RR Landa’s Exhibits 1-4.