Repairify, Inc. and Repairify Holdings, LLC v. Opus IVS, Inc. ( 2024 )

AFFIRMED and Opinion Filed May 16, 2024
S In the
Court of Appeals
Fifth District of Texas at Dallas
No. 05-23-00921-CV
REPAIRIFY, INC. AND REPAIRIFY HOLDINGS, LLC, Appellants
V.
OPUS IVS, INC., Appellee
On Appeal from the 471st Judicial District Court
Collin County, Texas
Trial Court Cause No. 471-00867-2023
OPINION
Before Justices Partida-Kipness, Pedersen, III, and Carlyle
Opinion by Justice Carlyle
Appellants Repairify, Inc. and Repairify Holdings, LLC [“Repairify”] appeal
the trial court’s order granting appellee Opus IVS, Inc.’s special appearance. We
affirm.
Repairify sued Opus, its competitor in the worldwide automotive repair
services industry, for tortious interference with contract after Opus hired William
O’Brien away from Repairify. Repairify’s principal place of business is in Plano,
Texas while Opus is incorporated in Delaware and has its principal place of business
in Michigan.
In its first issue, Repairify argues that a prior panel of this court adopted an
“erroneous (but common) misunderstanding of International Shoe Co. v.
Washington, 326 U.S. 310 (1945)” in Asshauer v. Glimcher Realty Trust, 228 S.W.3d
922, 933 (Tex. App.—Dallas 2007, no pet.), and that we should rectify this
misunderstanding by holding that the Supreme Court’s decision in Mallory v.
Norfolk Southern Railway Company, 600 U.S. 122, 135 (2023) abrogates our
personal jurisdiction precedent. Mallory concluded that Pennsylvania’s statutory
scheme specifically requiring registering non-resident corporations to consent to
general jurisdiction in the Commonwealth’s courts does not violate Due Process.
Mallory, 600 U.S. at 134–35 (quoting 42 PA. CONS. STAT. § 5301(a)(2)(i)).
The Mallory Court answered only that question, whether consent jurisdiction
for non-resident corporate defendants comports with Due Process. See id. at 139
(analogizing Norfolk Southern’s Due Process arguments against consent jurisdiction
to those made against tag jurisdiction in Burnham v. Super. Ct. of Cal., Co. of Marin,
495 U.S. 604 (1990)). Mallory never sought to instruct how to read a state’s statutes
or whether to intuit from them that they meant a registering business consented to
general jurisdiction in the absence of a clear statement of that consent. Cf. BRYAN
A. GARNER, ET AL., THE LAW OF JUDICIAL PRECEDENT 655 (2016) (state high courts
have the final say and final authority over interpretation of the state’s laws). The
Mallory Court answered “a very old question indeed—one this Court resolved more
than a century ago in Pennsylvania Fire [Ins. Co. of Philadelphia v. Gold Issue Min.
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& Mill. Co., 243 U.S. 93 (1917)].” Mallory has no effect on this court’s interpretation
of the Texas non-resident corporation registration scheme and we decline the
invitation to reinterpret settled Texas law. See Asshauer, 229 S.W.3d at 933 (“having
a registered agent and being registered to do business in Texas only potentially
subjects a foreign corporation to jurisdiction in this state”); Dowdy v. Miller, 122
S.W.3d 816, 822 (Tex. App.—Amarillo 2003, no pet.); TEX. BUS. ORGS. CODE ch. 9.
For similar reasons, we reject Reparify’s second issue, asking us to conclude
Texas’s statutory scheme related to non-resident businesses requires a conclusion
that Opus has consented to general jurisdiction in Texas simply by registering to do
business here. See id. The supreme court has repeatedly rejected mechanical tests for
jurisdiction, see Guardian Royal Exch. Assur., Ltd. v. English China Clays, P.L.C.,
815 S.W.2d 223, 231 (Tex. 1991), and unlike Pennsylvania law in Mallory, none of
Texas’s business registration statutes—and nothing in Texas’s long-arm scheme—
includes any language specifically directing that complying with them would subject
a business to personal jurisdiction in Texas. See Leonard v. USA Petroleum Corp.,
829 F. Supp. 882, 886–89 (S.D. Tex. 1993) (gently distinguishing Texas case law
holding otherwise).
In its third issue, Repairify argues Opus has sufficient minimum contacts with
Texas to subject it to specific jurisdiction and that subjecting Opus to specific
jurisdiction would not violate traditional notions of fair play and substantial justice.
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We review issues of personal jurisdiction over nonresident defendants de
novo. TV Azteca, S.A.B. de C.V. v. Ruiz, 490 S.W.3d 29, 36 n.4 (Tex. 2016). When a
trial court does not issue findings of fact and conclusions of law with its special
appearance ruling, we imply all facts necessary to support the judgment and
supported by the evidence. Old Republic Nat’l Title Ins. Co. v. Bell, 549 S.W.3d 550,
558 (Tex. 2018). And when the relevant facts are undisputed, an appellate court need
not consider any implied findings of fact and considers only the legal question of
whether the undisputed facts establish Texas jurisdiction. Id.Specific jurisdiction exists where a defendant purposefully avails itself of the
privilege of conducting activities in the forum state and the plaintiff’s claim arises
out of or is related to the defendant’s contacts with the forum. See LG Chem Am.,
Inc. v. Morgan, 670 S.W.3d 341, 347 (Tex. 2023). In connection with its special
appearance, Opus introduced evidence that (1) it has 289 employees and offices in
Michigan, California, New York, and Arizona, (2) it does not have an office in Texas,
(3) it has never owned any property in Texas, (4) it does not have any physical
locations in Texas, (5) it does not have any bank accounts in Texas, (6) O’Brien is a
resident of Arizona, (7) O’Brien works for Opus in Arizona, (8) Opus has never
communicated or otherwise interacted with O’Brien in Texas, (9) 19 of Opus’s
employees reside in Texas, (10) Opus recruits employees from every U.S. state, (10)
none of its salespeople are in Texas, and (11) O’Brien’s contract with Opus was
executed pursuant to Michigan law.
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Repairify’s live petition alleges:
Specific jurisdiction over Opus is proper in the state of Texas because
Opus solicited and recruited Defendant William O’Brien away from
Repairify, despite having knowledge of O’Brien’s restrictive covenants
with Repairify. O’Brien is the Global Sales Leader for Opus—
responsible for overseeing all of Opus’s sales. Opus directly competes
with Repairify, including in the state of Texas. Accordingly, O’Brien’s
knowledge of customers, vendors, employees, and confidential
information relating to diagnostic tools—of which he learned by means
of his employment with Repairify (a Texas resident)—is extremely
valuable to Opus. To gain the benefits of O’Brien’s knowledge of the
above, Opus purposefully interfered with the agreements between
O’Brien and Repairify.
Opus’s knowledge that its conduct might cause Repairify to suffer a competition
injury in Texas does not create sufficient minimum contacts to trigger specific
jurisdiction here. See Searcy v. Parex Res., Inc., 496 S.W.3d 58, 68–69 (Tex. 2016)
(“Mere knowledge that the ‘brunt’ of the alleged harm would be felt—or have
effects—in the forum state is insufficient to confer specific jurisdiction.”); Asshauer,
228 S.W.3d at 933. Notably missing from these allegations is the claim that Opus
took actions in Texas related to Repairify’s claims here. Repairify’s allegations
relating to O’Brien’s knowledge or the actions related to him joining and working
for Repairify are not relevant to analyzing specific jurisdiction over Opus. See
Walden v. Fiore, 571 U.S. 277, 284 (2014) (cleaned up) (only the “defendant
himself[’s]” contacts are relevant).
Repairify also argues that Opus has purposefully availed itself because it “has
recruited and employed at least 26 Texas residents since April 2021,” citing Texas
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Civil Practice and Remedies Code § 17.042(3).1 The acts listed in § 17.042 are those
that can bring a defendant within the Texas long-arm statute but have no special
relevance to the purposeful availment analysis, which is part of the analysis whether
exercising jurisdiction would satisfy federal and state constitutional due process
guarantees. See Schlobohm v. Schapiro, 784 S.W.2d 355, 356–57 (Tex. 1990). We
give this the minimal weight it deserves.
Under these circumstances, Repairify’s claim neither arises out of nor is
related to Opus’s purposeful contacts with Texas because none of the relevant actions
or actors sufficiently connect to Texas, as detailed above in the extensive non-Texas
actions related to the controversy here. See LG Chem Am., Inc., 670 S.W.3d at 347.
In light of this conclusion, we need not consider whether exercising jurisdiction
comports with traditional notions of fair play and substantial justice. See Foley v.
Trinity Indus. Leasing Co., 314 S.W.3d 593, 602 (Tex. App.—Dallas 2010, no pet.).
Finally, Repairify argues Opus is subject to general jurisdiction in Texas. For
at least all the reasons we reject specific jurisdiction, we reject the conclusion that
Opus’s contacts with Texas have been systematic and continuous, rendering it
essentially at home here. See Daimler AG v. Bauman, 571 U.S. 117, 139 n. 19
(2014); Searcy, 496 S.W.3d at 72.
1
“In addition to other acts that may constitute doing business, a nonresident does business
in this state if the nonresident . . . recruits Texas residents, directly or through an intermediary
located in this state, for employment inside or outside this state.”
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Having overruled each of Repairify’s four issues on appeal, we affirm the
trial court’s judgment.
/Cory L. Caryle/
CORY L. CARLYLE
JUSTICE
230921F.P05
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S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
REPAIRIFY, INC. AND On Appeal from the 471st Judicial
REPAIRIFY HOLDINGS, LLC, District Court, Collin County, Texas
Appellants Trial Court Cause No. 471-00867-
2023.
No. 05-23-00921-CV V. Opinion delivered by Justice Carlyle.
Justices Partida-Kipness and
OPUS IVS, INC., Appellee Pedersen, III participating.
In accordance with this Court’s opinion of this date, the judgment of the trial
court is AFFIRMED.
It is ORDERED that appellee OPUS IVS, INC. recover its costs of this
appeal from appellant REPAIRIFY, INC. AND REPAIRIFY HOLDINGS, LLC.
Judgment entered May 16, 2024
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