Leticia B. Loya v. Ian Taylor, Jacobus Sterken, Stichting Tinsel Group, Vitol Holding II S.A. and Tinsel Group, S.A. ( 2015 )

ACCEPTED
01-14-01014-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
5/4/2015 3:15:26 PM
CHRISTOPHER PRINE
CLERK
No.01-14-01014-CV
FILED IN
1st COURT OF APPEALS
HOUSTON, TEXAS
IN THE COURT OF ApPEALS 5/4/2015 3:15:26 PM
FOR THE FIRST DISTRICT OF TEXAS CHRISTOPHER A. PRINE
Clerk
AT HOUSTON
LETICIA LOYA,
Appellant,
v.
IAN TAYLOR, JACOBUS STERKEN, STICHTING TINSEL GROUP, VITOL HOLDING II
S.A., AND TINSEL GROUP, S.A.,
Appellees.
Appeal from the 190th Judicial District Court, Harris County, Texas
Trial Court Cause No. 2012-33464
ApPELLANT'S REPLY BRIEF
PROVOST* Ul\1PHREYLAW FIRM, L.L.P.
Jennifer Job
Texas State Bar No. 2604582
James E. Payne
Texas State Bar No. 00788171
P.O. Box 4905
Beaumont, Texas 77701
(409) 835-6000
Facsimile (409) 813-8605
jjob@pulf.com
ATTORNEYS FOR APPELLANT
ORAL ARGUMENT REQUESTED
TABLE OF CONTENTS
TABLE OF CONTENTS ,., , , , i
TABLE OF AUTHORITIES , " ,.."., .."" .., , , , .ii
SUMMARY OF THE ARGUMENT 1
ARGUMENT AND AUTHORITIES 1
Standard of Review 2
The Trial Court Erred in Granting the Appellees' Special Appearances 2
A. Appellees' Case Law is Inapposite. . 9
B. Appellant Pled Sufficient Jurisdiction Facts Against
Each Appellee. . , 13
C. The Forum Selection Clause in Contracts Plaintiff Did Not Sign
Cannot Insulate Appellees from Jurisdiction , 16
D. The Fiduciary Shield Doctrine Does Not Apply Here and Has Never
Been Adopted by the Texas Supreme Court, 18
E. Texas Has an Interest in Adjudicating this Dispute with a Texas
Plaintiff, a Texas Divorce, and Texas Co-Defendants - and Appellees
Have Profited Greatly from Texas and Houston in Particular 20
The Trial Court Erred in Denying Appellant's Motion for Continuance to
Conduct Discovery. . ,,.," ..,", , ,", " ..,'" ," , 22
CONCLUSION AND PRAYER 23
CERTIFICATE OF SERVICE 23
CERTIFICATE OF COMPLIANCE 25
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TABLE OF AUTHORITIES
Cases
Air Tropiques, Sprl. v. Northern & Western Ins. Co., Ltd.
2014 WL 1323046 (S.D. Tex. 2014) 9, 10
Barriere v. Juluca,
No. 12-23510-CIV, 2014 WL 652831 (S.D. Fla. Feb. 19,2014) ....... 8
Boyer v. Diversified Consultants, Inc.,
2014 WL 6607005 (E.D. Mich. Nov. 19,2014) 8
Brown v. Gen. Brick Sales Co., Inc.,
39 S.W.3d 291 (Tex. App.-Fort Worth 2001, no pet. h.) 18
Camac v. Dontos,
390 S.W.3d 389 (Tex. App.-Dallas 2012, no pet. h.) 19
Carbon it Houston, Inc. v. Exch. Bank,
628 S.W.2d 826 (Tex. App.-Houston [14thDist.] 1982,
writ ref'd n.r.e. 1982) 14
Carone v. Retamco Operating, Inc.,
138 S.W.3d 1 (Tex. App.-San Antonio 2004, pet. denied) 19
Daimler AG v. Bauman,
571 U.S. _,134 S. Ct. 746,187 L. Ed. 2d 624 (2014) Passim
Denso Corp. v. Hall,
396 S.W.3d 681 (Tex. App.-Houston [14th Dist.] 2013) 9, 10
D.H Blair Inv. Banking Corp. v. Reardon,
97 S.W.3d 269 (Tex. App.-Houston [14thDist.] 2002,
pet. dism'd w.o.j.). . 19
Garner v. Furmanite Australia Pty., Ltd.,
966 S.W.2d 798 (Tex. App.-Houston [1st Dist.] 1998,
pet. denied). .. 18
~ 11 -
George v. Uponor Corp.,
988 F. Supp. 2d 1056 (D. Minn. 2013), reconsideration denied (Apr.
14, 2014) 8
In re Cathode Ray Tube (CRT) Antitrust Litig.,
2014 WL 1091044 (N.D. Cal. Mar. 13,2014) 8
In re Ian Taylor,
401 S.W.3d 69 (Tex. App.-Houston [14th Dist.]
2009, no pet. h.) 5
MasterGuard L.P. v. Eco Technologies Intern., LLC,
441 S.W.3d 367 (Tex. App.-Dallas 2013, no pet. h.) 16
Michiana Easy Livin ' Country, Inc. v. Holten,
168 S.W.3d 777 (Tex. 2005) 10, 11, 12, 16, 17,22
Moki Mac River Expeditions v. Drugg,
221 S.W.3d 569 (Tex. 2007) 2, 22
Morris v. Kohls-York,
164 S.W.3d 686 (Tex. App.-Austin 2005, pet. disru'd) 18
National Indus. Sand Ass 'n v. Gibson,
897 S.W.2d 769 (Tex. 1995). . 2
Nichols v. Tseng Hsiang Lin,
282 S.W.3d 743 (Tex. App.-Dallas 2009, no pet.) 18
Perna v. Hogan,
162 S.W.3d 648 (Tex. App.-Houston [14th Dist.]
2005, no pet. h.) 18
PHC-Minden, L.P. v. Kimberly-Clark Corp.,
235 S.W.3d 163 (Tex. 2007) 11, 12
Read v. Cary,
615 S.W.2d 296 (Tex. Civ. App.-Dallas 1981,
writ ref'd nr.e.) 14, 15
-iii -
SITQ E. U, Inc. v. Reata Restaurants, Inc.,
111 S.W.3d 638 (Tex. App.-Fort Worth 2003, pet. denied). ......... 18
Solargenix Energy, LLC v. Acciona, S.A.,
2014 IL App (1st) 12340 8
Spir Star AG v. Kimich,
310 S.W.3d 868 (Tex. 2010) 5
Tabacinic v. Frazier,
372 S.W.3d 658 (Tex. App.-Dallas 2012, no pet.) 18, 19
Tex Va, Inc. v. Boone,
300 S.W.3d 879 (Tex. App.-Dallas 2009, pet. denied) 19
Temperature Sys, Inc. v. Bill Pepper, Inc.,
854 S.W.2d 669 (Tex. App.-Dallas 1993,
writ dism 'd by agreement). .. 14
TV Azteca v. Ruiz;
13-12-00536-CV, 2014 WL 346031 (Tex. App.-Corpus
Christi 2014, pet. granted Jan. 30,2015). .. 11
Wright v. Sage Eng 's.
137 S.W.3d 238 (Tex. App-Houston [1st Dist.] 2014,
pet denied) 18, 19
- IV-
SUMMARY OF THE ARGUMENT
Jurisdiction exists in Texas over each Appellee. The trial court wrongly
granted Appellees' special appearances under Rule 120A of the Texas Rules of
Civil Procedure. Appellees do not really dispute that Daimler AG v. Bauman has
been widely limited by courts across the nation; Daimler does not reach nearly as
far as Appellees mislead the trial court to believe. 571 U.S. _, 134 S. Ct. 746,
187 L. Ed. 2d 624 (2014). Defendants' response either ignores the evidence or
misstates the evidence in an effort to cloud the clear connection to Texas of each of
the Appellees. Under either the general or specific jurisdiction test, Texas has
jurisdiction over each Appellee.
In the alternative, the trial court erred in failing to grant Appellant's motion
for continuance to receive written discovery responses back from Appellees on the
subject of jurisdiction. As a result, this Court should reverse the trial court's ruling
and remand for further proceedings.
ARGUMENT AND AUTHORITIES
Business entities and persons who take advantage of Texas economies,
employees and courts should be subject to Texas court's jurisdictions. Defendants
cannot enter into and rely on contracts with Texans and then disavow personal
jurisdiction in Texas. Therefore, Appellant asks this Court to reverse the decision
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of the trial court and remand for further proceedings. In support thereof, Appellant
shows the following.
STANDARD OF REVIEW
In the special appearances, Appellees each bore the burden of negating all
bases of personal jurisdiction. See National Indus. Sand Ass n v. Gibson, 897
I
S.W.2d 769, 772 (Tex. 1995). A review of the record and the law establishes that
none of the Appellees met this burden.
I. THE TRIAL COURT ERRED IN GRANTING THE ApPELLEES' SPECIAL
ApPEARANCES
The Court need only find general or special jurisdiction on the Appellees in
order to reverse the trial court's decision. As detailed in Appellant's original brief,
the Appellees have more than sufficient contacts with Texas to impose jurisdiction
under general jurisdiction, and Appellees overstate the reach of Daimler. Further,
Appellees' contacts have a substantial enough connection with the lawsuit to
impose specific jurisdiction under the pleadings, and Appellees overstate the
requirements of specific jurisdiction. The Texas Supreme Court has already
rejected the position Appellees urge this Court to impose, which would have
required the contact to be "substantially relevant to proof of the claim" to impose
specific jurisdiction. Mold Mac River Expeditions v. Drugg, 221 S.W.3d 569, 581-
82 (Tex. 2007).
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Instead, the trial court had before it a record that both legally and factually
demanded jurisdiction over Appellees. Legally, Appellees relied in their pre-trial
briefing on contracts that Appellees entered with Texas residents; more
importantly, they relied on contracts that centered on the very stock made the basis
of Plaintiffs lawsuit. CR 997-1159, App., tabs B-F.
And factually, this case clearly survived the jurisdictional analysis. Appellee
Ian Taylor is the president of the Vitol Group and the largest single shareholder.
ld. at 3. While Appellees' briefing suggests that the Texas corporate co-defendant
Vitol, Inc. was wholly separate from the larger "Vitol Group" and that Appellant
was conflating the entities, Taylor himself conflates them and acknowledges that
the Vitol Group does its business through Texas corporation Vitol, Inc.:
A: Houston is our main office, and therefore, Vitol, Inc.
is our main entity in the United States by which we - we
trade. In other words, we buy physical oil and physical
gas, physical power. We're buying and selling that ~
those commodities in the name of Vitol, Inc. So that's
why I said it's our main office in the United States. And
therefore, we do all our business through it.
OUf people, our staff, indeed, primarily are in Houston,
Texas.
I think it's fair to say we have a, yes, significant trading
presence in Houston.
CR 1008, 1010-11.
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Specifically as to Taylor himself, he testified that of the offices across the
world, Houston is one office of probably only five or six that are important enough
to the Vitol Group for him to visit annually. CR 1045-46. He monitors the
Houston office's activities and performance daily. CR 1047. Taylor testified that
almost 10% of Vitol entities employees worldwide work in the Houston office. CR
1011. He testified regarding the multiple contracts he entered with co-Defendant
Miguel Loya, a Houston resident regarding his Vital stock, including the stock
whose value is in question in this underlying suit. CR 681-700. He specifically
admitted soliciting share purchase transactions with Mr. Loya and the 50-60 other
Texan shareholders at least yearly. CR 1019-1028. Taylor also signed a Statutory
Durable Power of Attorney citing Texas law, appointing Houston resident and
codefendant Mr. Loya to act as his attorney-in-fact as manager of Knightsbridge,
signing the Power of Attorney in Texas in front of a Houston notary. CR 1033;
781-84. He has served as a manager and sole member of a limited liability
company organized here in Texas, under which he entered a contract to purchase a
Houston, Texas condo. CR 1029. Taylor stated he knew that his Texas limited
liability company sought seeking relief from a Texas court in relation to this
contract with Harris County, Texas defendants. CR 1036-37. Appellees protest
the interpretation of the litigation surrounding Mr. Taylor's deposition in the
subject divorce, but the text of the opinion speaks for itself. The Court analyzed
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Taylor's unique knowledge and the need for his testimony on the stock that is
made the subject of this lawsuit and owned by Texas residents after Taylor
solicited Mr. Loya's stock purchase. See In re Ian Taylor, 401 S.W.3d 69, 71 (Tex.
App.-Houston [14th Dist.] 2009, no pet. h.); CR 838-45, App., tab AA. The trial
court overruled his special appearance. Id. Similarly, there is ample evidence to
support jurisdiction against Taylor, and the trial court erred.
As for Tinsel Group, S.A. ("Tinsel"), half of its corporate directors are
Texas residents. CR 1176, 1178, 1180. As would be expected, Tinsel
acknowledged that all the attendant mailings, e-mails and phone calls from and to
those directors are centered in Texas. CR 1180, 1188, 1224, 1226. Tinsel also
entered into a number of contracts with Houston residents and co-defendants to
this lawsuit. CR 1204, 1206, 1210, 1240. Tinsel has sought remedies from Judge
Miller and taken advantage of Houston courts. CR 1218. Tinsel complains in its
brief that the remedies it sought were under federal law. However, Tinsel must
acknowledge that it submitted itself to a Texas court in that matter, and that this is
not a case where Tinsel has any" ... unique and onerous burden placed on a party
called to defend a suit in a foreign legal system." Spir Star AG v. Kimich, 310
S.W.3d 868,879-80 (Tex. 2010). Here, as in Spir Star, Tinsel's burden litigating
in Texas is obviously "minimal and is outweighed by [Plaintiff Loya's] and
Texas's interests in adjudicating the dispute here." Id. If Tinsel can come to
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Houston federal court to seek remedies, it can travel a few blocks away to the state
courthouse to defend. The trial court had jurisdiction over Tinsel.
Jacobus G. Sterken is a tax lawyer for Vitol entities, and a director in
roughly thirty (30) Vitol entities, including two Vitol entities headquartered and
registered in Texas. CR 1090-91. Specifically, Sterken has also served as a director
in Vitol, Inc., a co-defendant in this case headquartered in Houston which has not
protested jurisdiction, from approximately 2008 through 2010. CR 1095-96.
Sterken travels annually since 1999 to Houston, Texas, and communicates via e-
mail and phone about Vito I, Inc.'s tax matters. CR 1096-98, 1119-20. He has
executed multiple contracts with Texas residents related to Vitol entity stock. CR
264-273; CR 276-79. Sterken acknowledged that his communications - involving
topics such as the intrinsic value of Loya and other shareholder's shareholding -
would reach shareholders in Houston and other parts of Texas. CR 1108-09; 280-
282; 283-87, 288-89, 290-91, 292-93, 274-75, 1108-9, 1118-19. The trial court
clearly had jurisdiction over Sterken.
As to Appellee Stichting Tinsel, Ian Taylor testified in his deposition that
Mr. Loya's ownership in Vitol (the shares made the basis of this lawsuit) was
"derivative" through "a Luxemburg company that is a holding company through
Stichting Tinsel, and that "by his ownership of Tinsel represents a correlative
ownership ofVitol." CR 554-55. Stichting Tinsel was "effectively a vehicle [ ] for
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US shareholders" like Texans Miguel and Leticia Loya. CR 555. A director of
Stichting Tinsel testified that he himself has been to Houston "maybe more than a
dozen times" since 2011 - not under subpoena or otherwise by force - to discuss
issues in litigation between Vitol entities and the Loya divorce and Loya family
trust. CR 1073-74. This director acknowledged that Stichting Tinsel entered into
several contracts with the knowledge that the relevant shareholder and Vitol entity
employee was a Texas resident. CR 1066, 1070-71. Stichting Tinsel was a
signatory to the shareholder agreements that the Vitol Defendants rely upon in
their Motion to Dismiss. CR 594-630. Stichting Tinsel has executed multiple
additional contracts with Houston resident Miguel Loya which the Vitol
Defendants specifically relate to the stock valued in the Loya divorce and made the
subject of the pending lawsuit. CR 643-49. Stichting Tinsel has entered into
similar agreements for approximately seventy (70) Texas residents who are
employees of a Vitol entity. CR 1075-76. The trial court clearly had jurisdiction
over Stichting Tinsel.
VHIISA has similarly entered into multiple contracts with co-defendant and
Houston resident Mr. Loya that relate to the stocks at issue. CR 322-34, 337-41,
342-46, 347-50, 351-53, 1137-43. Additionally, VHIISA sent similar shareholder
communications and entered into similar contracts with approximately 50-60
Houston shareholders. CR 1144-47. Finally, Houston resident Miguel Loya
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served as a director ofVHIISA from 2007 through 2013. CR 1134-1135. The trial
court clearly had jurisdiction over VHIISA.
The facts overwhelmingly demonstrate that these are Defendants seeking to
have their cake and eat it too - make money from the Houston economy, use
Houston employees and shareholders, form Texas structures under Texas law,
solicit and execute contracts with Texans, and seek remedies in Texas courts, but
to avoid those same courts when sued for their behavior. Appellees rely heavily on
Daimler, but unlike post-Daimler cases rejecting jurisdiction, this case has:
• The presence of a forum-based defendant. The U.S.-based related
corporation - Vitol, Inc. - is a defendant in this action, unlike Daimler, as
are Texan individual co-defendants.. CR 18-19. George v. Uponor Corp.,
988 F. Supp. 2d 1056, 1079 (D. Minn. 2013), reconsideration denied (Apr.
14, 2014); see also Solargenix Energy, LLC v. Acciona, S.A., 2014 IL App
(1 st) 12340.
• The end target and end result of the activity was in the forum state, as
Plaintiff clearly pled in this case. In re Cathode Ray Tube (CRT) Antitrust
Litig., No. C-07-5944-SC, 2014 WL 1091044, at *7 (N.D. Cal. Mar. 13,
2014); Boyer v. Diversified Consultants, Inc., 2014 WL 6607005 at *5 (E.D.
Mich. Nov. 19, 2014) ("However, this case concerns limited personal
jurisdiction for alleged conduct causing consequences in the forum state,
..which is a different issue entirely").
• No "absence of a Texas connection to the injury, perpetrator, or victim" in
this case. Barriere v. Juluca, No. 12-23510-CIV, 2014 WL 652831, at *9
(S.D. Fla. Feb. 19,2014). This case centers around a Texas divorce, a Texas
stock sale transaction, Texas residents, Texas codefendants, and a company
whose primary U.S. situs is in Houston. CR 1008, 16-38.
-8-
While Appellees would have this Court believe that Daimler virtually
eradicates jurisdiction against foreign-based defendants, that is not the case. This
case falls squarely within the type of cases that survive the Daimler analysis.
A. Appellees' Case Law is Inapposite
Further, the cases Appellees cite are inapposite. For example, Appellees cite
Denso Corporation v. Hall for the proposition that execution of multiple contracts
does not automatically imply general jurisdiction. Appellees' Brief at 15, citing
Denso Corp. v. Hall, 396 S.W.3d 681 (Tex. App.-Houston [14th Dist.] 2013).
First, that was never Appellant's position; it is the number and nature of these
contracts that should carry the day for Appellant. Second, the kinds of contracts at
issue in Denso were minimal in both number and in scope. ld. at 695. In Denso,
the foreign defendant entered into only two (2) contracts with Texas companies.
ld. at 693. Both of those contracts were essentially licensing agreements that did
not require the provision of any service at all. ld. at 695. Unsurprisingly, the court
did not find that these two (2) contracts requiring (absolutely no performance by
the parties to the contract) demonstrated general jurisdiction. ld.
Similarly, Appellees point to Judge Rosenthal's recent decision in Air
Tropiques, Sprl. v. Northern & Western Ins. Co., Ltd. 2014 WL 1323046 (S.D.
Tex. 2014). But Air Tropiques involved a defendant who "participated in
underwriting the insurance policy that covered property located in Africa, for an
- 9-
insured based in Africa, by an insurer in S1.Kitts." ld. at * 11. The defendant "did
not provide any insurance coverage in Texas or seek business from Texas." ld.
The contract at issue did not have any foreseeable Texas consequences, and the
defendant did not contract with Texas residents. ld. at * 12.
Cases like Denso and Air Tropiques present a wholly different fact pattern
than the present case. Neither does the Texas Supreme Court's decision in
Michiana Easy Livin' Country, Inc. v. Holten support Appellees' position. 168
S.W.3d 777 (Tex. 2005). Michiana involved the following fact pattern:
James Holten decided to buy a $64,000 Coachmen
recreational vehicle sight unseen. Eschewing every RV
dealer in Texas, he sought a lower price from Michiana
Easy Livin' Country, Inc., an outlet store that only did
business in Indiana. Holten called Michiana in Indiana,
sent payment to Indiana, paid for delivery from Indiana,
and agreed to resolve every dispute in Indiana. But when
a dispute actually arose, he filed suit in Texas.
ld. at 781.
The Michiana defendant was not related to the manufacturer or any national
dealer. ld. at 784. It did not advertise in Texas or even on the Internet (almost
unbelievable in this digital age), and did not solicit any business from the plaintiff.
ld. Because the plaintiff wanted a cheaper price than any Texas RV dealer, he
called the Coachmen factory, which referred him to the factory outlet defendant,
who he then called and arranged for the sale himself. ld.
-10 -
Even in the extreme fact pattern presented in Michiana, the Court still
instructed that a single contract can suffice to impose jurisdiction:
"It is true that in some circumstances a single contract
may meet the purposeful-availment standard, but not
when it involves a single contact taking place outside the
forum state. A long-term franchise agreement may
establish minimum contracts because, though it stems
from a single contract, it involves any contacts over a
long period of time. Similarly, a life insurance policy
may stem from a single contract, but necessarily involves
a series of contacts until death does the parties part."
Id. at 787 (emphasis in original).
Appellees also rely heavily on PHC-Minden, L.P. v. Kimberly-Clark
Corporation. 235 S.W.3d 163 (Tex. 2007). First, PHC-Minden has no application
to cases where specific jurisdiction is alleged. Id., as recognized in on TV Azteca v.
Ruiz, 13-12-00536-CV, 2014 WL 346031, at *26 (Tex. App.-Corpus Christi Jan.
30,2014), review granted (Jan. 30,2015). Second, the Texas Supreme Court noted
in this case that the parties had "conducted extensive discovery relating to the
jurisdictional issue," which did not occur in this case. PHC-Minden, 235 S.W.3d
at 166. Third, the contacts in PHC-Minden were of an entirely different nature than
the contacts presented here. Minden employees had only traveled to Texas twice;
sent payments to Texas companies for unrelated purchases; and entered three
contracts that were for limited and minimal services. Id. at 170-171.
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This case is a far cry from the PHC-Minden case. Without rehashing the
facts as stated in the original briefing, Appellees have entered into dozens of
contracts with Houston residents and co-defendants that they contend control the
direction of this litigation; they have sued in Houston, Texas district courts; they
have directors living in Houston, Texas; they visit Houston at least annually; they
benefit from Houston's unique properties; they incorporate businesses in Texas;
buy Texas real estate; they correspond daily with the Houston offices and
directors;' they serve as "vehicles" for Texas shareholders. CR 239-1159. Clearly,
this case meets the requirements of general jurisdiction and is easily
distinguishable from Daimler.2 Further, this case meets the requirements of
specific jurisdiction in that the sorts of contacts Appellees had with Texas were
significant and involve the Texas stocks at issue in this case. Appellees are
estopped from placing such high reliance on the forum selection clauses in the
shareholder agreements in their forum selection analysis, while distancing
themselves from those same contracts with Texas residents in the jurisdiction
1 While Appellees argue that the membership of half of one entity's board being Texan residents
is wholly irrelevant, the Texas Supreme Court has disagreed, noting in holding that personal
jurisdiction existed over a Defendant where "[t]hree of [the protesting defendant],s directors
collectively own seventy-five percent of Limited, which will be litigating in Houston." Spir Star
AG v. Kimich, 310 S.W.3d 868, 879 (Tex. 2010). If even ownership of a Texas subsidiary by
foreign directors is relevant, it is all the more persuasive when half of the defendant's board of
directors are Texas residents.
2 Appellees make frequent references to the merits of the case but that is not the focus of the
jurisdictional analysis. As the Texas Supreme Court stated in Michiana, "[jjurisdiction cannot
turn on whether a defendant denies wrongdoing - again as virtually all will." Michiana East
Livin' Country, Inc. v. Holten, 168 S.W.3d 777, 791 (Tex. 2005).
- 12 -
analysis (which is an entirely separate issue). Texas has both general and special
jurisdiction over Appellees, and the trial court erred in holding otherwise.
B. Appellant pled sufficient jurisdictional facts a2ainst each Appellee.
Appellees contend that Appellant failed to set forth and plead jurisdiction
facts as to at least Taylor and Sterken and this alone should result in the trial
court's order being upheld. Appellees exaggerate the record and ignore the
extensive jurisdictional pleading made by the Appellant. Appellant pled in its
Second Amended Petition that Sterken and Taylor had actively participated in
Texas businesses, solicited business from Texas residents, had sufficient minimum
contacts to be subject to Texas jurisdiction, that they fraudulently misrepresented
the acquisition of assets that would enhance the value of the Loya's Tinsel shares
(which were subject to an agreement executed by Miguel Loya as a Texas
resident); that they misrepresented the value of those shares through depositions
and discovery in the Texas divorce lawsuit; that they failed to make Plaintiff as a
(Texan) Vitol shareholder aware of material facts necessary for sound decisions;
that they entered into a conspiracy with the Texas codefendants to commit this
fraud; that they used the mail system to commit this fraud with Plaintiff as a Texan
resident; and that they violated Section 27.01 et seq. of the Texas Business and
Commerce Code by making false representations regarding this Texas stock
- 13 -
exchange between Plaintiff and Miguel Loya. Second Amended Petition at ,-r,-r7,10,
22, 41, 42, 43, 44, 45. Appellant clearly pled sufficient facts to impose both
specific and general jurisdiction. Further, courts perform a full review of the
record when there is no objection to the evidence presented in the pleadings and
special appearance hearing, and Appellant significantly briefed this topic and
submitted a plethora of documents and evidence on the topic. Temperature Sys.,
Inc. v. Bill Pepper, Inc., 854 S.W.2d 669, 673 (Tex. App.-Dallas 1993), writ
dism'd by agreement (June 16, 1993). And Appellees' contention that they have
met their burden to negate same by stating that Sterken and Taylor are non-
residents of Texas is simply false. "[Pjroof of nonresidency is not enough when a
plaintiff alleges jurisdictional facts. Id. Then, a defendant must also negate the
jurisdictional facts alleged. ld.; Carbonit Houston, Inc. v. Exch. Bank, 628 S.W.2d
826, 831 (Tex. App.-Hollston [14th Dist.] 1982), writ ref'd n.r.e. (Tex. 1982)
("Such evidence [adduced at the special appearance hearing] does not include any
proof that the defendants' alleged acts complained of by plaintiff did not occur in
Texas."). "Regardless of [a tortfeasor's] location at the time he made the
representations, [if] they were relied upon in Texas, and communicated to
[plaintiffs] in Texas,... that is sufficient to come within the provisions of [the long
arm statute]." Read v. Cary, 615 S.W.2d 296, 298-99 (Tex. Civ. App.-Dallas
- 14-
1981), writ ref'd n.r.e. (Tex. 1981). Appellees have not met their burden, and their
arguments fail. Id.
Appellees also argue that Plaintiff's pleadings were inadequate as to
Appellees Stichting Tinsel, VHIISA, and Tinsel because "she merely alleged that,
as to VHIISA, Tinsel, and Stichting Tinsel, these entities engaged in unspecified
"activities purposefully directed to Texas that caused injury arising to and relating
to those activities that form the basis of the lawsuit." Appellees' Brief at 23. If
Appellees read merely the first few pages of the Petition, that might be true.
Instead, Appellees plead for each of the corporate entities that they "purposefully
availed themselves of conducting activities within the State of Texas by soliciting
contracts with Texas residents, including but not limited to Miguel A.
Loya ... conducting meetings in Texas... placed phone calls, e-mails.mail. and
faxes intended to solicit contracts and other business with Texas residents,
including but not limited to Miguel A. Loya," that they fraudulently
misrepresented the acquisition of assets that would enhance the value of the Loya's
Tinsel shares (which were subject to an agreement executed by Miguel Loya as a
Texas resident); that they misrepresented the value of those shares through
depositions and discovery in the Texas divorce lawsuit; that they failed to make
Plaintiff as a (Texan) Vitol shareholder aware of material facts necessary for sound
decisions; that they entered into a conspiracy with the Texas codefendants to
~15 ~
commit this fraud; that they used the mail system to commit this fraud with
Plaintiff as a Texan resident; and that they violated Section 27.01 et seq. of the
Texas Business and Commerce Code by making false representations regarding
this Texas stock exchange between Plaintiff and Miguel Loya. Second Amended
Petition at -,r~5,6, 12,22,41,42,43,44,45. Appellant clearly pled sufficient facts
to impose both specific and general jurisdiction against Stichting Tinsel, Tinsel,
and VHIISA, and Appellees' citation of the first few pages of the petition does not
reflect Appellant's pleadings. Appellant adequately plead jurisdiction, and the
burden then fell to Appellees to negate all bases of jurisdiction. They did not.
C. The Forum Selection Clause in Contracts Plaintiff Did Not Sign Cannot
Insulate Appellees from Jurisdiction
Appellees repeatedly reference the forum selection clauses in the
shareholder agreements. But the Texas Supreme Court has already held that:
"[A] forum selection clause designating [another forum]
does not necessarily indicate [a defendant] had no
minimum contracts anywhere else. Generally, a forum-
selection clause operates as consent to jurisdiction in one
forum, not proof that the Constitution would allow no
other."
Michiana East Livin' Country, Inc. v. Holten, 168
S.W.3d 777, 792 (Tex. 2005) (emphasis added); See also
MasterGuard L.P. v. Eco Technologies Intern., LLC, 441
S.W.3d 367 (Tex. App.-Dallas 2013, no pet. h.)
(finding specific jurisdiction, reversing district court's
decision granting special appearance, and stating
"[ajlthough [defendant's] contracts with independent
dealers were governed by Iowa law, it is the creation of
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those contractual relationships by [defendant] m
Texas ... that is the subject of [plaintiffj's claims, not
disputes arising out of the contracts themselves.").
Further, the plaintiff in Michiana did not assert that enforcement of the
forum selection clause from the contract (which he sought after and signed) was
unreasonable or unjust, and the Court understandably held that "he should be held
to it." ld. at 793. By contrast, in the present case, it is without dispute that
Plaintiff Leticia Loya has never solicited any contracts with a foreign forum
selection clause with Appellees and certainly never signed any. 3 Enforcement of
the forum selection clause, or even construction of the forum selection clause to
grant Appellees' special appearances, would be unreasonable and unjust. As the
dissent to Michiana stated:
Michiana's brief refers to the forum selection clause only
as evidence of its own desire that litigation take place in
Indiana. Sufficient contacts do not become insufficient
simply because the defendant does not want to travel.
ld. at 798. (Medina, J., dissenting).
Similarly here, Appellees' own desire that this particular litigation take place
in another forum does not render its contacts insufficient simply because Appellees
do not want to travel. Appellees' forum selection clauses (in contracts to which
3This issue will be briefed in great detail in the sister-appeal to this case in this Court with Cause
No.OI-15-00197-CV. Appellant's Brief in that case will be filed May 22,2015.
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Plaintiff was not a party) do not erase Appellees' numerous and significant
contacts with Texas.
D. The Fiduciary Shield Doctrine Does Not Apply Here and Has
Never Been Adopted by the Texas Supreme Court
Appellees Ian Taylor and Jacobus Sterken also rely on the fiduciary shield
doctrine. But that doctrine has never been adopted by the Texas Supreme Court.
Perna v. Hogan, 162 S.W.3d 648 (Tex. App.-Houston [14th Dist.] 2005, no pet.
h.); Brown v. Gen. Brick Sales Co., Inc., 39 S.W.3d 291, 300 (Tex. App.-Fort
Worth 2001, no pet. h.). Further, the application of the fiduciary shield doctrine
has been limited to general jurisdiction cases and is not applicable to specific
jurisdiction cases. Id.; Nichols v. Tseng Hsiang Lin, 282 S.W.3d 743, 750 (Tex.
App.-Dallas 2009, no pet.); Morris v. Kohls-York, 164 S.W.3d 686, 691 (Tex.
App.-Austin 2005, pet. dism'd); Wright v. Sage Eng'g, 137 S.W.3d 238, 247 to
248 (Tex. App.-Houston [1st Dist.] 2004, pet. denied); SITQ E.U, Inc. v. Reata
Restaurants, Inc., 111 S.W.3d 638, 651 (Tex. App.-Fort Worth 2003, pet.
denied); cf Garner v. Furmanite Australia Pty., Ltd" 966 S.W.2d 798, 803 (Tex.
App.-Houston [1st Dist.] 1998, pet. denied). Further, "under the fiduciary shield
doctrine, there is no blanket protection from personal jurisdiction simply because
the defendant's alleged acts were done in a corporate capacity; instead, each
defendant's contacts with the forum State must be assessed individually."
Tabacinic v. Frazier, 372 S.W.3d 658, 664 (Tex. App.-Dallas 2012, no pet.)
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(individual nonresident defendants who formed corporate entities for purpose of
acquiring and selling real estate in Texas were not protected under the fiduciary
shield doctrine from the exercise of specific personal jurisdiction in action by
Texas residents asserting negligent misrepresentation and fraudulent inducement in
connection with their purchase of residential real estate; case involved allegations
sounding in tort for which defendants might be held individually liable); Morris v.
Kohls-York, 164 S.W.3d 686, 696 (Tex. App.-Austin 2005, pet. dism'd); Wright
v. Sage Eng'g, 137 S.W.3d 238, 250 (Tex. App.-Houston [1st Dist.] 2004, pet.
denied); Carone v. Retamco Operating, Inc., 138 S.W.3d 1, 10 (Tex. App.-San
Antonio 2004, pet. denied); D.H Blair Inv. Banking Corp. v. Reardon, 97 S.W.3d
269, 277 to 278 (Tex. App.-Houston [14th Dist.] 2002, pet. dism'd w.o.j.). Thus,
a corporate officer is not protected from the exercise of specific jurisdiction under
Texas' fiduciary shield doctrine, even if all of his contacts were performed in a
corporate capacity, if the officer engaged in tortious or fraudulent conduct, directed
at the forum state, for which he may be held personally liable. Camac v. Dontos,
390 S.W.3d 398, 411 (Tex. App.-Dallas 2012, no pet.); TexVa, Inc. v. Boone, 300
S.W.3d 879, 887 (Tex. App.-Dallas 2009, pet. denied). Unlike as characterized
by the Appellees, Mr. Taylor owned and was the sole manager of a Texas Limited
Liability Company. Taylor, with personal funds, purchased real estate in Texas.
Plaintiff has alleged independent tortious activities by Taylor and Sterken that
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could not have furthered the business of any Vitol Group and for which they would
be individually liable, and thus the fiduciary shield doctrine cannot apply - even if
it had been adopted by the Texas Supreme Court.
F. Texas Has An Interest in Adjudicating this Dispute with a Texas
Plaintiff, a Texas Divorce, and Texas Co-Defendants - and Appellees
Have Profited Greatly from Texas and Houston in Particular
Further, the Texas Supreme Court in Spir Star emphasized Texas' interest in
exercising jurisdiction over disputes involving Texas residents, particularly when
Texas codefendants are already properly in the lawsuit:
"Not only would [PlaintiffJ face an undue burden were he
forced to litigate his product liability claim against AG in
Germany, but because the claims against Limited will be
heard in Texas, it would be more efficient to adjudicate
the entire case in the same place ... We recognize the
unique and onerous burden placed on a party called to
defend a suit in a foreign legal system... In this case, that
burden is minimal and is outweighed by Kimich' sand
Texas's interests in adjudicating the dispute
here... Asserting personal jurisdiction over AG comports
with traditional notions of fair play and substantial
justice."
Spir Star AG v. Kimich, 310 S.W.3d 868, 879-80 (Tex.
2010).
The Court has been very clear that a foreign defendant cannot take
advantage of OUf resources but excuse itself from our courts:
Contrast those cases with the situation here. AG's board
of directors created Limited because AG wanted to take
advantage of the biggest economy in the world. Strobach
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testified that 'the whole board ... decided that [Houston
would be the best place for a distributor] because we
knew that - we thought that would be the greatest need,
because of the immediate vicinity of all the refineries.
Strobach traveled to Houston because 'we wanted to
establish an office in Houston.'
Spir Star AG v. Kimich, 310 S,W,3d 868,871,877 (Tex.
2010) ("... AG decided that Houston would be the
optimallocation for a distributorship because the Texas
coastal region's numerous refineries were well suited for
AG's energy related products.").
First, while Appellees also complain that Vitol, Inc. - a codefendant - is the
only company with its primary headquarters in Texas, this Spir Star opinion
illustrates that use of an intermediary cannot insulate a defendant from the reach of
a Texas court when the defendant is benefiting from the Texas market. Spir Star
AG v. Kimich, 310 S,W.3d 868, 871 (Tex. 2010). Second, Appellee Stichting
Tinsel in particular was "effectively a vehicle [ ] for US shareholders" like Miguel
and Leticia Loya; it was intended to serve over 70 Texan residents, including co-
Defendant and Texan Miguel Loya. CR 555; CR 591-93 at ,-r2.1. Finally, in the
present case, Taylor testified that he made the conscious decision to relocate Vitol,
Inc. to Houston. CR 1049-1050. He then testified regarding the unique qualities of
Houston, Texas that he wished to take advantage of in relocating:
Well, obviously, the United States is a major market for
both the export and the import of petroleum products and
crude oil. And Houston - it is, indeed, a fact, Houston is
the center for the particularly - well, it's the major - it's
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the major city in - in the area surrounded by major
refineries and major other oil counterparties .
.. .1 think it's - Houston is the - you know, it's the right
place for - for Vitol as a physical energy company to be.
CR 1050.
Appellees would exploit Houston as a resource as the "right place to be"
geographically, but assert that Houston courts are anywhere but the "right place to
be." The Texas Supreme Court has already rejected this position in Spir Star, and
so should this Court.
II. THE TRIAL COURT ERRED IN DENYING APPELLANT'S MOTION FOR
CONTINUANCE TO CONDUCT DISCOVERY
Appellees complain of the scope of the discovery Appellant propounded at
the trial court level. But in determining whether the defendant purposefully
directed action toward Texas, the COUlt may look to conduct beyond the particular
business transaction at issue: "[ajdditional conduct of the defendant may indicate
an intent or purpose to serve the market in the forum State." Moki Mac, 221
S.W.3d at 577; see also Michiana, 168 S.W.3d at 786 (stating that Texas "cases
appear to follow the 'additional conduct standard' "). Under this standard, and
because Daimler did not eviscerate general jurisdiction in the manner Appellees
argue, Appellant's discovery was entirely appropriate. While Appellant believes
the special appearances should be reversed in their entirety, should the Court have
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any doubts, Appellant respectfully asks this Court to reverse and remand for an
opportunity to conduct discovery on the issue of jurisdiction.
CONCLUSION AND PRAYER
For these reasons, Appellant Leticia Loya asks the Court to reverse the
ruling of the trial court and to remand for further proceedings, and for any and all
further relief to which Appellant are entitled, including but not limited to costs of
appeal.
Respectfully submitted,
*
PROVOST UMPHREY LAW FIRM, L.L.P.
Jennifer Job
Texas State Bar No. 2604582
James E. Payne
Texas State Bar No. 00788171
490 Park Street
P.O. Box 4905
Beaumont, Texas 77701
(409) 835-6000
Facsimile (409) 813-8605
jjob@pulf.com
jpayne@pulf.com
ATTORNEYS FOR APPELLANT
LETICIA LOYA
CERTIFICATE OF SERVICE
I hereby certify that one true and correct paper copy and one electronic copy
of the above and foregoing instrument was mailed this 4th day of May, 2015, to
counsel of record below via e-file:
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Patrick W. Mizell
Deborah C. Milner
Jaclyn M. Lynch
Vinson & Elkins
1001 Fannin, Suite 2500
Houston, Texas 77002
7131758-2932
Fax: 713/615-5912
pmizell@velaw.com
cmilner@velaw.com
iaclynlynch@velaw.com
Counselfor the VitolDefendants
Samuel A. Houston
Shepherd, Scott, Clawater & Houston
2777 Allen Parkway, 7thFloor
Houston, Texas 77019
713/650-6600
Fax: 713/650-1720
shouston@sschlaw.com
Counselfor Harry Tindall and Tindall & England PC
Randall B. Wilhite
Fullenweider Wilhite, P.C.
4265 San Felipe, Suite 1400
Houston, Texas 77027
713/624-4100
Fax: 713/624-4141
rwilhite@fullenweider.com
Counselfor Miguel Loya
/ s / Jennifer Job
Jennifer Job
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CERTIFICATE OF COMPLIANCE
This document complies with the typeface requirements of Tex. R. App. P.
9 A( c) because it has been prepared in a conventional typeface no smaller than 14-
point for text and 12-point for footnotes. This document also complies with
the word-count limitations of Tex. R. App. P. 9.4(i), if applicable, because it
contains 5,456 words, excluding any parts exempted by Tex. R. App. P. 9.4(i)(1).
/ s / Jennifer Job
Jennifer Job
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