Adelaida Salazar Bautista A/K/A Adelaida Alvarado, Individually and as Next Friend of Maria Jennifer Aide A/K/A Maria Jennifer Alvarado, A. A., A. A., I. S. A., M. A., and E. A., Minors And Irineo Alvarado and Maria Ana Moctezuma v. Trinidad Drilling Limited

FILED IN
st
1 COURT OF APPEALS
HOUSTON, TX
No. 01-14-00892-CV January 21, 2015
CHRISTOPHER A. PRINE,
CLERK
In the Court of Appeals
for the First Judicial District
Houston, Texas
ADELAIDA SALAZAR BAUTISTA A/K/A ADELAIDA ALVARADO,
INDIVIDUALLY AND AS NEXT FRIEND OF MARIA JENNIFER AIDE
A/K/A MARIA JENNIFER ALVARADO, A. A. A. A., I. S. A., M. A., AND E.
A., MINORS; AND IRINEO ALVARADO AND MARIA ANA MOCTEZUMA,
Appellants,
v.
TRINIDAD DRILLING LIMITED,
Appellee.
On Appeal from the
270th Judicial District Court of Harris County
BRIEF OF APPELLANTS
Respectfully submitted,
By /s/ Geoffrey E. Schorr
Geoffrey E. Schorr
geoff@schorrfirm.com
Texas Bar No. 24029828
A. Jared Aldinger
Texas Bar No. 24068456
jared@schorrfirm.com
SCHORR LAW FIRM, PC
328 W. Interstate 30, Suite 2
Garland, TX 75043
Tel. (972) 226-8860
Fax (972) 226-9787
Hutton W. Sentell
Texas Bar No. 24026655
hsentell@ashmorelaw.com
ASHMORE LAW FIRM, P.C.
3636 Maple Ave.
Dallas, TX 75219
Tel. (214) 559-7202
Fax (214) 520-1550
Andrew P. McCormick
Texas Bar No. 3457100
amccormick@mlm-lawfirm.com
McCORMICK, LANZA & McNEEL, LLP
4950 Bissonnet Street
Bellaire, TX 77401
Tel. (713) 523-0400
Fax (713) 523-0408
ATTORNEYS FOR
PLAINTIFFS/APPELLANTS ADELAIDA
SALAZAR BAUTISTA a/k/a ADELAIDA
ALVARADO, Individually, and as next
friend of MARIA JENNIFER AIDE a/k/a
MARIA JENNIFER ALVARADO,
AURELIA ALVARADO, ALEJANDRA
ALVARADO, IVAN SALAZAR
ALVARADO, MARIAN ALVARADO, and
EDUARDO ALVARADO, Minors
And
By: /s/ Justin K. Hall
Justin K. Hall
Texas Bar No. 90001828
jkhall@justinkhall.com
328 W Interstate 30, Suite 2
Garland, Texas 75043
Tel. (972) 226-1999
Fax (972) 226-2221
Attorney for Plaintiffs, Irineo Alvarado and
Maria Ana Moctezuma
ORAL ARGUMENT REQUESTED
INDEX OF PARTIES AND COUNSEL
1. Appellants:
a. Adelaida Salazar Bautista a/k/a Adelaida Alvarado, Individually, and as
next friend of Maria Jennifer Aide a/k/a Maria Jennifer Alvarado, Aurelia
Alvarado, Alejandra Alvarado, Ivan Salazar Alvarado, Marian Alvarado
and Eduardo Alvarado, Minors
Represented by:
Geoffrey E. Schorr
geoff@schorrfirm.com
Texas Bar No. 24029828
A. Jared Aldinger
Texas Bar No. 24068456
jared@schorrfirm.com
SCHORR LAW FIRM, PC
328 W. Interstate 30, Suite 2
Garland, TX 75043
Tel. (972) 226-8860
Fax (972) 226-9787
Andrew P. McCormick
Texas Bar No. 3457100
amccormick@mlm-lawfirm.com
McCORMICK, LANZA & McNEEL, LLP
4950 Bissonnet Street
Bellaire, TX 77401
Tel. (713) 523-0400
Fax (713) 523-0408
b. Irineo Alvarado and Maria Ana Moctezuma
Represented by:
Justin K. Hall
Texas Bar No. 90001828
jkhall@justinkhall.com
Page iv
The Law Offices of Justin K. Hall, P.C.
328 W Interstate 30, Suite 2
Garland, Texas 75043
Tel. (972) 226-1999
Fax (972) 226-2221
Andrew P. McCormick
Texas Bar No. 3457100
amccormick@mlm-lawfirm.com
McCORMICK, LANZA & McNEEL, LLP
4950 Bissonnet Street
Bellaire, TX 77401
Tel. (713) 523-0400
Fax (713) 523-0408
2. Appellee:
Trinidad Drilling, Ltd.
Represented by:
Michael Beckelman
Texas Bar No. 24042401
michael.beckelman@wilsonelser.com
WILSON ELSER MOSKOWITZ
EDELMAN & DICKER, LLP
909 Fannin Street, Ste. 3300
Houston, TX 77010
Tel. (713) 353-2000
Fax (713) 785-7780
Page v
TABLE OF CONTENTS
INDEX OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .VIII
STATEMENT OF THE CASE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .X
STATEMENT REGARDING ORAL ARGUMENT . . . . . . .. . . . . . . . . . . .XI
ISSUES PRESENTED . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .XII
BRIEF. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I. Summary of Argument............................................................................1
II. Statement of Facts ...................................................................................2
III. Applicable legal standards ......................................................................8
IV. As a preliminary matter, this Court should apply a de novo review to
factual issues, with inferences drawn in favor of jurisdiction. ...........10
V. Trinidad Limited is subject to specific jurisdiction based on its own
acts. ........................................................................................................13
A. As a preliminary matter, there is no dispute that Plaintiffs have pled tort
claims based on Trinidad Limited’s own actions. .................................14
B. The evidence and uncontroverted allegations show Trinidad Limited set
operational policies and exercised operational control over Trinidad
L.P.’s drilling operations in Texas. ........................................................16
1. The uncontroverted allegations show that Trinidad Limited
exercised operational control and set operational policies for Trinidad
L.P. .........................................................................................................16
2. Even if Plaintiffs’ allegations had been controverted, the great
weight of evidence demonstrates that Trinidad Limited retained the
right to control, and set operational policies for, drilling operations. ...18
C. Trinidad Limited knew and intended that its control would extend to
drilling operations in Texas and that Texas residents would bear the risk
of any negligent policies or control. ......................................................24
Page vi
D. Therefore, Trinidad Limited is subject to specific jurisdiction, as it
could “reasonably anticipate being haled into Court” in Texas and the
exercise of jurisdiction would not offend fair play and substantial
justice. ....................................................................................................27
VI. Trinidad Limited is also subject to general jurisdiction based on its
own acts. ................................................................................................30
VII. Prayer.....................................................................................................34
CERTIFICATE OF COMPLIANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
CERTIFICATE OF SERVICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Page vii
INDEX OF AUTHORITIES
Authority Page(s)
As-ahi A1etal Industries Co. v. Superior Court, 480 U.S. 102 (1987) 29
Assurances Generales Banque Nationale v. Dhalla,
282 S.W.3d 688 (Tex. App.—Dallas 2009, no pet.) 8
BMC Software Belgium, N.V. v. Marchand,
83 S.W.3d 789 (Tex. 2002) 11
Buchanan v. Rose, 159 S.W.2d 109 (Tex. 1942) 14
Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) 9, 28, 30, 33
Burk Royalty Co. v. Walls, 616 S.W.2d 911 (Tex. 1981) 14
Design Info. Sys. v. Feith Sys. & Software, Inc., 801 S.W.2d
569 (Tex. App.—Fort Worth 1990, no writ), rev'd in
part on other grounds, 813 S.W.2d 481 (Tex. 1991) 31
El Chico Corp. v. Poole, 732 S.W.2d 306 (Tex. 1987) 14
Fox v. Dallas Hotel Co., 240 S.W. 517 (1922) 14
Guardian Royal Exch. Assurance, Ltd. v. English China Clays,
815 S.W.2d 223 (Tex. 1991) 25, 29
Guidry v. U.S. Tobacco Co., Inc., 188 F.3d 619 (5th Cir. 1999) 10, 11, 28
Helicopteros Nationales de Columbia, S.A. v. Hall,
466 U.S. 408 (1984) 9, 28
Internat’l Shoe Co. v. Washington, 326 U.S. 310 (1945) 9, 24, 27
Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653 (Tex. 2010) 11
Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569 (Tex. 2007) 10
Page viii
Moncrief Oil Int'l Inc. v. OAO Gazprom,
414 S.W.3d 142 (Tex. 2013) 12, 13
Nat’l Indus. Sand Ass'n v. Gibson, 897 S.W.2d 769 (Tex. 1995) 8, 10, 11,
13, 27
Nogle & Black Aviation, Inc. v. Faveretto, 290 S.W.3d 277 (Tex.
App.—Houston [14th Dist.] 2009, no pet.) 15, 17
Otis Eng'g Corp. v. Clark, 668 S.W.2d 307 (Tex. 1983) 14
PHC-Minden, L. P. v. Kimberly Clark, Corp., 235 S.W.3d 163
(Tex. 2007) 21, 22
Retamco Operating, Inc. v. Republic Drilling Co.,
278 S.W.3d 333 (Tex. 2009) 8
Schlobohm v. Schapiro, 784 S.W.2d 355 (Tex. 1990) 30
Temperature Sys., Inc. v. Bill Pepper, Inc., 854 S.W.2d 669
(Tex. App. –Dallas 1993, writ dism'd by agr.) 30
Twentieth Century Fox Film Corp. v. Marvel Enterprises, Inc.,
No. 01 CIV. 3016(AGS)(HB), 2002 WL 1835439,
(S.D.N.Y. 2002) 33
Wellness Wireless, Inc. v. Vita, No. 01–12–00500–CV.,
2013 WL 978270, (Tex. App.—Houston
[1 Dist.] 2013, no pet.) 12
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980) 9, 28
Page ix
STATEMENT OF THE CASE
Nature of the Case This action arose from an incident connected with a
drilling rig, which resulted in the death of Nabor
Alvarado. At the time of the incident, Nabor Alvarado
was working on the rig for his employer, Trinidad
Drilling Limited Partnership (“Trinidad L.P.”).
Plaintiffs/Appellants (“Plaintiffs”) are Nabor Alvarado’s
surviving relatives, and they have brought suit against
several defendants. In particular, Plaintiffs have asserted
claims against Trinidad Drilling Ltd. (“Trinidad
Limited”), based on Trinidad Limited’s own negligence
and gross negligence in controlling aspects of Trinidad
L.P.’s drilling operations. Trinidad Limited contends it is
not subject to personal jurisdiction, which is the issue
now before this Court.
Course of Proceedings Appellants filed suit against multiple entities, including
Appellee, a Canadian based company, in connection with
the death of Nabor Alvarado. Appellants contend that
Appellee was subject to the jurisdiction of Texas Courts
based on its contacts with Texas. After being served with
the lawsuit, Appellee filed a special appearance
challenging the Trial Court’s jurisdiction. After a
hearing, the Trial Court sustained the special appearance.
The Appellants now appeal the Trial Court’s ruling on
the special appearance.
Trial Court The Honorable Brent Gamble, 270th Judicial District
Court, Harris County, Texas
Trial Court Disposition The trial court sustained Trinidad Drilling’s Amended
Special Appearance, without making findings of fact or
conclusions of law.
Page x
STATEMENT REGARDING ORAL ARGUMENT
Appellants respectfully request oral argument if it will aid the Court in its
decisional process.
Page xi
ISSUES PRESENTED
Whether the trial court erred by granting Defendant/Appellee’s special
appearance:
A. As a preliminary matter, is the Court required to defer to the trial
court’s ruling on factual issues, where the trial court sustained the
special appearance and did so on a “cold record”?
B. Is Trinidad Drilling Ltd. subject to specific jurisdiction?
C. Is Trinidad Drilling Ltd. subject to general jurisdiction?
Page xii
No. 01-14-00892-CV
In the Court of Appeals
for the First Judicial District
Houston, Texas
ADELAIDA SALAZAR BAUTISTA A/K/A ADELAIDA ALVARADO,
INDIVIDUALLY AND AS NEXT FRIEND OF MARIA JENNIFER AIDE
A/K/A MARIA JENNIFER ALVARADO, A. A. A. A., I. S. A., M. A., AND E.
A., MINORS; AND IRINEO ALVARADO AND MARIA ANA MOCTEZUMA,
Appellants,
v.
TRINIDAD DRILLING LIMITED,
Appellee.
On Appeal from the
270th Judicial District Court of Harris County
BRIEF OF APPELLANTS
I. Summary of Argument
This appeal involves a special appearance by Trinidad Drilling Ltd., in a
wrongful-death and survival action regarding the death of Nabor Alvarado. Nabor
Alvarado’s surviving relatives have alleged that Trinidad Drilling Ltd. controlled
aspects, including the safety aspects, of the drilling operations that resulted in
Nabor Alvarado’s death. Moreover, they have alleged that Trinidad Drilling Ltd.
Page 1
was negligent and grossly negligent in exercising such control, given that it was
aware of five previous incidents of the type that resulted in Nabor Alvarado’s
death.
The trial court sustained Trinidad Drilling Ltd.’s special appearance and
dismissed it for lack of personal jurisdiction. However, the trial court was in error,
as the undisputed allegations and the great weight and preponderance of evidence
show that Trinidad Drilling Ltd. is subject to both specific and general jurisdiction.
As discussed in Section V:
1. Trinidad Drilling Ltd. exercised control over, set policies for, and took
responsibility for aspects of drilling operations in Texas, see supra,
Section V(B);
2. Trinidad Limited knew and intended that the drilling operations would
be conducted in Texas, and that its control and policy-setting would
therefore extend to Texas operations, see supra, Section V(C); and
3. Plaintiff has alleged that Trinidad Limited was negligent in exercising
control and setting policies, and Plaintiff’s claims arise from such
negligence, see supra, Section V(A).
Therefore, Trinidad Drilling Ltd. is subject to specific jurisdiction in this case.
Moreover, as discussed in Section IV, the evidence is also sufficient to establish
general jurisdiction. Therefore, the trial court should be reversed, and this action
should be remanded for a trial on the merits.
II. Statement of Facts
This action arises from an incident that occurred on or about July 13, 2010,
which resulted in the death of Nabor Alvarado. C.R.35 ¶ 3.01. At the time of the
Page 2
incident, Nabor Alvarado was helping install guide beams on a drilling rig—Rig #
130—for his employer, Trinidad Drilling Limited Partnership (“Trinidad L.P.”).
See C.R.35 ¶¶ 3.01-3.02.1 Plaintiffs/Appellants (“Plaintiffs”) are Nabor
Alvarado’s surviving relatives, including his minor children. See C.R.33 ¶¶ 1.01-
1.02. They have brought suit against several defendants, including Trinidad L.P.’s
parent company, Trinidad Drilling Ltd. (“Trinidad Limited”), which is the
Appellee on this appeal. See C.R.33 ¶¶ 1.03-1.09. The claims against Trinidad
Limited are not made on any alter-ego or similar veil-piercing theory; rather,
Plaintiff asserts claims against Trinidad Limited for its own alleged acts and
omissions. See, e.g. C.R.38-40 ¶¶ 4.01-4.13.
More specifically, Plaintiffs have alleged: that Trinidad Limited exercised
control over, and set policies for, aspects of Trinidad L.P.’s drilling operations; that
Trinidad Limited did so negligently; and that such negligence caused Plaintiffs’
injuries. See C.R.35 ¶ 3.03; C.R.38-40 ¶¶ 4.01-4.13. Of particular note, Plaintiffs
have alleged that Trinidad Limited was aware of at least five prior, documented
accidents similar to the one causing Nabor Alvarado’s death. C.R.38 ¶¶ 4.08-4.09.
The relevant portions of Plaintiffs’ live pleading (the Third Amended Petition) are
as follows:
1
In this brief, the Original Clerk’s Record is cited as “C.R.” The 1st Supplemental
Clerk’s Record is cited as “Supp. C.R.”
Page 3
3.01 This action arises from an incident occurring on or about July 13,
2010, that resulted in the death of Nabor Alvarado. At the time of the
incident, Nabor Alvarado was helping install the National Oil Well
Varco guide beams on the drilling rig that would serve as the torque
track for the top drive system for Rig #130. Rig #130, manufactured
by VREC, had recently been moved to a new drilling site at 5700 US
Hwy 287, Arlington, Tarrant County, Texas, also known as the Yorn
1-H Lease, and was in the process of being rigged up to drill for gas.
While in the process of putting together and hanging the National Oil
Well Varco top drive guide beam track using the track carrier, based
upon information and belief, the top of the first section of track caught
and hung on the back side of the VREC derrick. Following the derrick
strike, the traveling block continued pulling the track carrier upwards
ripping a wire rope in half, causing the track carrier, also known as the
Rig Up Down cart, to suddenly and unexpectedly fall back down to
the rig floor, striking, pinning, impaling and killing Nabor Alvarado.
3.02 On the date of the incident Nabor Alvarado was working on the
gas well rig in Tarrant County in the course and scope of his
employment with TRINIDAD LP.
3.03 TRINIDAD LIMITED is the parent company of TRINIDAD LP,
and it directs, controls and supervises the HSE (Health, Safety and
Environment) of the drilling operations of TRINIDAD, LP, and
investigates, creates and issues policy manuals and procedures for
TRINIDAD, LP. TRINIDAD LIMITED had knowledge of 5
previously documented derrick strikes of the same manner that
resulted in Nabor's death and its actions in taking remedial measures
demonstrate its ownership and control of the operations and activities
that resulted in Nabor's death. Although it had knowledge of the
dangerous operations, activities and conditions relating to derrick
strikes, TRINIDAD LIMITED did not make changes to policies
and/or procedures regarding preventing derrick strikes until after
Nabor's death.
...
4.07 At all relevant times Defendant TRINIDAD LIMITED was the
parent company to TRINIDAD, LP, and exercised ownership, control
and took responsibility for overseeing safety policies and procedures
for the crews on the drilling rigs.
Page 4
4.08 Based on information and belief, prior to Nabor's tragic and
untimely death, TRINIDAD LIMITED had actual knowledge of 5
documented incidences of derrick strikes of the same manner as the
one that killed Nabor. In fact, one of TRINIDAD LIMITED's
employees wrote an email about the previous documented incidences
to an employee of NOV. Inexplicably, TRINIDAD LIMITED failed
to implement new policies and procedures to try and correct and/or
prevent the type of derrick strike that resulted in Nabor's death until
after he died.
4.09 Defendant TRINIDAD LIMITED and its agents, servants and/or
employees, by assuming ownership, control and responsibility for safe
drilling practices in Texas, were negligent in failing to properly
oversee, instruct, train and/or supervise the safe operation of rigging
up the drilling rig. Because of the 5 previous documented incidences
of derrick strikes, Defendant TRINIDAD LIMITED was well aware
of the need for training, oversight and supervision in the safe
installation of the drilling rig, top drive, and guide beam track and to
otherwise provide a safe environment to prevent just the type of
catastrophic failure that injured and killed Nabor Alvarado, and by its
actions and/or inactions exposed Nabor Alvarado to the threat of
serious or fatal injury, and thereby acted without proper regard for the
safety of Nabor Alvarado.
4.10 The injuries and damages sustained by [Plaintiffs] were
proximately caused by the negligence of Defendant TRINIDAD
LIMITED and its agents, servants and/or employees including, but not
limited to, the following acts or omissions:
1. Defendant TRINIDAD LIMITED failed to provide a safe
environment, and took incomplete or improper action to inspect
for hazardous/dangerous conditions and did not warn of any
such conditions;
2. Defendant TRINIDAD LIMITED knew that Nabor Alvarado
would be exposed to a serious risk of injury and had a duty to
protect Nabor Alvarado, but failed to do so;
3. Defendant TRINIDAD LIMITED failed to supervise and/or
ensure proper training and/or procedures were followed in
Page 5
rigging up of the National Oilwell Varco guide beam track
system and top drive equipment; and
4. Defendant TRINIDAD LIMITED failed to create and
implement new policies and procedures after having knowledge
of 5 prior documented incidences of derrick strikes of the same
manner that resulted in near misses.
4.11 Each of the above acts of negligence was a proximate cause of
the injuries and damages sustained by Nabor Alvarado and Plaintiffs .
...
4.12 Additionally, Defendant TRINIDAD LIMITED and its agents,
servants and/or employees were grossly negligent in failing to provide
Nabor Alvarado and others with proper instruction, training and
supervision, which control was retained by TRINIDAD LIMITED.
4.13 As such, TRINIDAD LIMITED displayed such an entire want of
care that its actions were the result of conscious indifference to the
rights, safety, and welfare of Nabor Alvarado. Such gross negligence
was a proximate cause of the injuries and damages sustained by Nabor
Alvarado, deceased, and Plaintiffs . . ., and pursuant to the provisions
of Chapter 41 of the Texas Civil Practice and Remedies Code,
Defendant TRINIDAD LIMITED is liable for exemplary damages.
C.R.35-36; C.R.38-40.
In its Amended Special appearance, Trinidad Limited purported to show that
it was not subject to jurisdiction in Texas, focusing primarily on arguments
involving corporate veil piercing. C.R.14-24. However, it did not do so.
The Amended Special Appearance was not verified; instead it was supported
by an affidavit that only attested to the facts in such affidavit. C.R.28 ¶ 1. In turn,
Trinidad Limited’s affidavit did not controvert Plaintiffs’ allegations regarding
negligent control of drilling operations in Texas. See, e.g., infra, Section V(B)(1).
Page 6
Indeed, the affidavit did not contain any testimony concerning control or policies at
the time of the accident. See id. Although Trinidad Limited subsequently filed a
second affidavit before the special-appearance hearing, that affidavit likewise did
not controvert Plaintiffs’ key allegations. See Supp. C.R.353-358. The hearing was
non-evidentiary.
In addition to their uncontroverted allegations, Plaintiff produced additional
evidence showing Trinidad Limited’s contacts with Texas, including evidence
showing that:
 Trinidad Limited’s “General Manager of Corporate HSE” maintained
a physical office in Texas, see, e.g. C.R.79;
 Trinidad Limited maintained control over aspects of Trinidad L.P.’s
drilling operations, as evidenced by a subsequent remedial plan
applicable to all of Trinidad Limited’s operations, both in the U.S. and
Canada, see, e.g., C.R.80;
 Trinidad Limited’s employees and officers made 126 trips to Texas to
create and control Trinidad L.P.’s operations in the years leading up to
incident, see, e.g., Supp. C.R.115;
 Trinidad Limited bought, or at least financed, the drilling rig that
resulted in Nabor Alvarado’s death, for the express purpose to have
such rig be used in operations in Texas, see C.R.51; C.R.65-66;
C.R.81, Supp. C.R.356 ¶ 24.; Supp. C.R.444; and
 Trinidad Limited’s annual reports have consistently and publicly
identified “Wells Fargo, N.A.” in “Houston, Texas” as the “banker”
for “Trinidad Drilling Ltd.,” see, e.g. Supp. C.R.237.
Page 7
Despite the uncontroverted allegations and the evidence produced by
Plaintiffs, the Court sustained Trinidad Limited’s special appearance. See
C.R.128-129. Plaintiff then appealed to this Court.
III. Applicable legal standards
Under the Texas long-arm statute, the plaintiff has the initial burden to plead
sufficient allegations to confer jurisdiction. Retamco Operating, Inc. v. Republic
Drilling Co., 278 S.W.3d 333, 337 (Tex. 2009). This burden is minimal and is
satisfied by an allegation that the nonresident defendant is “doing business” in
Texas under the long-arm statute. See, e.g., Assurances Generales Banque
Nationale v. Dhalla, 282 S.W.3d 688, 695 (Tex. App.—Dallas 2009, no pet.).
Therefore, on a special appearance, the defendant “asserting lack of personal
jurisdiction by special appearance has the burden of negating all bases of
jurisdiction.” Nat’l Indus. Sand Ass'n v. Gibson, 897 S.W.2d 769, 772 (Tex.
1995). In this case, Trinidad Limited does not dispute that Plaintiffs satisfied the
requirements of the Texas long-arm statute; instead, Trinidad Limited challenges
jurisdiction only on the basis of due process.
The parties agree on the basic principles of due process, which allows a
court to exercise personal jurisdiction over a nonresident defendant when: (1) the
defendant has established “minimum contacts” with the forum state; and (2) the
exercise of jurisdiction over that defendant does not offend “traditional notions of
Page 8
fair play and substantial justice.” Internat’l Shoe Co. v. Washington, 326 U.S. 310,
316 (1945).
Two distinct, alternative classes of personal jurisdiction fall within the
minimum-contacts prong of this due process test: (1) specific and (2) general. A
state may exercise specific jurisdiction over a nonresident defendant when the
lawsuit arises from or relates to the defendant's contact with the forum state.
Helicopteros Nationales de Columbia, S.A. v. Hall, 466 U.S. 408, 414 n.8 (1984).
In that context, the minimum contacts prong is satisfied by actions, or even a single
act, by which the nonresident defendant “purposefully avails itself of the privilege
of conducting activities within the forum State, thus invoking the benefits and
protections of its laws.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475
(1985). The nonresident's “purposeful availment” must be such that the defendant
“should reasonably anticipate being haled into court” in the forum state. World-
Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 287 (1980). Conversely,
general jurisdiction will exist if the nonresident defendant has had continuous and
systematic contacts with the forum state, even if the cause of action did not arise
from the defendant's purposeful conduct in that state. Helicopteros Nationales de
Columbia, S.A. v. Hall, 466 U.S. 408, 414-16 (1984).
Page 9
IV. As a preliminary matter, this Court should apply a de novo review to
factual issues, with inferences drawn in favor of jurisdiction.
As a preliminary matter, Plaintiffs raise an issue regarding the proper
standard of review—specifically the standard for reviewing implied factual
findings. For reasons discussed in the following sections, this issue is ultimately
unnecessary to resolution of this appeal, since the undisputed allegations and the
evidence demonstrate that the trial court’s decision should be reversed under any
standard. Nevertheless, Plaintiffs raise the issue out of abundance of caution.
This Court indisputably applies a de novo review to all legal issues in this
case, and that determination of jurisdiction is ultimately a question of law. See
Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007).
However, given that this case was decided on a “cold record,” Plaintiffs contend
that the Court should also review any necessary factual issues de novo, with all
inferences drawn in favor of jurisdiction. This is the standard that applies under
federal law governing due process analysis. See, e.g., Guidry v. U.S. Tobacco Co.,
Inc., 188 F.3d 619, 625 (5th Cir. 1999) (“accept[ing] as true the nonmover's
allegations and resolv[ing] all factual disputes in its favor”). Likewise, it is the
standard that is most consistent with the overarching principle that the defendant
bears the “burden of negating all bases of jurisdiction.” Nat’l Indus. Sand Ass'n v.
Gibson, 897 S.W.2d 769, 772 (Tex. 1995).
Page 10
Out of candor, this is not the standard that is typically applied to
jurisdictional cases. Instead, Texas courts have routinely applied a standard that
gives a degree of deference to the trial court—requiring the appellate court to
imply findings in support of the judgment (so long as they are supported by the
evidence). See, e.g., BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789,
795 (Tex. 2002). However, this standard was developed from situations in which
the trial court: (1) decided jurisdiction on live testimony (meaning the trial court
was in a better position to resolve conflicts in evidence); and/or (2) the trial court
denied the special appearance (making deference justifiable because unresolved
conflicts in evidence would simply mean the defendant had failed to negate
jurisdiction). For instance, the two most-cited “cold record” cases both dealt with
situations in which the trial court denied a special appearance (i.e. holding that
jurisdiction existed). See Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 657
(Tex. 2010); BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex.
2002). In such cases, the implying of findings to support the judgment is: (1) the
same standard as making inferences and resolving conflicting evidence in favor of
retaining jurisdiction (i.e., it is the same as the federal standard); and (2) is
consistent with the principle that the defendant bears the burden to negate
jurisdiction. See, e.g., Guidry,188 F.3d at 625; Nat’l Indus. Sand Ass'n, 897
S.W.2d at 772.
Page 11
In contrast, the application of such standard makes no sense in cases (such as
this one), where the trial court granted Trinidad Limited’s special appearance
challenging jurisdiction on a “cold record.” Unfortunately, courts have
subsequently applied this standard to cases such as this without considering the
logical-disconnect, since Plaintiffs typically failed to challenge the standard. Thus,
these cases have resulted in snowballing dicta, with courts (including this one)
feeling compelled to apply the standard in those few cases where the standard has
been challenged—despite recognizing that such a standard is inappropriate. See,
e.g., Wellness Wireless, Inc. v. Vita, No. 01–12–00500–CV., 2013 WL 978270, *3
n.1 (Tex. App.—Houston [1 Dist.] 2013, no pet.).
However, Plaintiffs do not believe that there is any binding authority from
the Texas Supreme Court on this issue. Instead, it appears the Texas Supreme
Court addressed this particular issue—“cold record” and order sustaining special
appearance— for the first time last year, but it declined to make a ruling on this
issue. Moncrief Oil Int'l Inc. v. OAO Gazprom, 414 S.W.3d 142, 150 n.4 (Tex.
2013). More specifically, the court decided it did not need to address the issue
because it determined trial court should be reversed regardless of the standard. Id.
This Court can do the same in this case, since the following sections
demonstrate that Trinidad Limited is subject to jurisdiction regardless of the
standard applied to factual review. Nevertheless, if the Court determines that the
Page 12
standard of factual review is determinative on any issue, the Court can and should
apply a de novo review. In other words, by recognizing that it has not yet decided
that issue, the Texas Supreme Court’s statement in Gazprom presents an
opportunity for this Court and other appellate courts to address the issue directly,
rather than simply following prior dicta.2
Therefore, the Court should apply a de novo review of all issues in this case,
with all inferences drawn in favor of jurisdiction. This is the standard applied in
federal court and it is the standard consistent with the principle that Trinidad
Limited bears the “burden of negating all bases of jurisdiction.” Nat’l Indus. Sand
Ass'n v. Gibson, 897 S.W.2d 769, 772 (Tex. 1995).
V. Trinidad Limited is subject to specific jurisdiction based on its own acts.
First, Trinidad Limited is subject to jurisdiction for actions taken in its own
right, without regard to whether it is subject to jurisdiction for the acts of its
subsidiary under alter-ego or other veil-piercing theories (which are not at issue).
More specifically, Plaintiff has alleged that Trinidad Limited set operational-level
policies for, and exercised control over, its subsidiaries’ drilling operations. See,
e.g., C.R.35-36 ¶ 3.03; C.R.38-40 ¶¶ 4.07-4.10. However, Trinidad Limited
failed to address known safety concerns—including concerns based on “5
previously documented derrick strikes of the same manner that resulted in Nabor's
2
If the Court disagrees and believes it is bound by any prior cases, then Plaintiffs
nevertheless reserve the right to raise the issue with the Texas Supreme Court, if appropriate.
Page 13
death.” See, e.g., C.R.35-36 ¶ 3.03; C.R.38-40 ¶¶ 4.07-4.10. As such, these
allegations undisputedly state a claim for negligence under Texas law.
In turn, Trinidad Limited knew and intended that its policies would be
implemented in Texas and that Texas residents would bear the risk of its
negligence in setting such policies. Therefore, Trinidad Limited could “reasonably
anticipate being haled into court” in Texas, and it is subject to jurisdiction as to
claims arising from these contacts.
A. As a preliminary matter, there is no dispute that Plaintiffs have pled
tort claims based on Trinidad Limited’s own actions.
As a preliminary matter, there is no dispute as to whether Plaintiffs have
pled tort claims against Trinidad Limited for its own actions. Nor could there be,
as Plaintiffs’ allegations state direct claims against Trinidad Limited, for its own
acts and omissions, under a number of theories.3 See C.R.35-36; C.R.38-40.
3
To use one theory as an illustration, Texas courts have long recognized that a party
always has a duty to prevent harm to which its acts contribute. See Otis Eng'g Corp. v. Clark,
668 S.W.2d 307, 309 (Tex. 1983); see also Fox v. Dallas Hotel Co., 240 S.W. 517, 520–21 (Tex.
1922), partially overruled on other grounds by Burk Royalty Co. v. Walls, 616 S.W.2d 911 (Tex.
1981). This principle applies whether the party acted gratuitously or “to promote its own
interests.” Fox, 240 S.W. at 520. Furthermore, this is true whether or not a legal relationship or
privity exists between the defendant and the plaintiff. See El Chico Corp. v. Poole, 732 S.W.2d
306, 311 (Tex. 1987) superseded by statute on other grounds, Tex. Alco. Bev. Code §
2.03(a). Or stated another way, if a person creates or contributes to a situation, it becomes his
duty to prevent injury to others if such injuries are reasonably foreseeable. Id. (citing Buchanan
v. Rose, 159 S.W.2d 109, 110 (Tex. 1942)). Indeed, if a defendant contributes to a dangerous
situation, even “without negligence on his part,” he has a duty to at least “give warning” to those
that foreseeably might be injured as a consequence. Buchanan, 159 S.W.2d at 110. Thus,
Plaintiffs’ allegations state negligence and gross negligence claims against Trinidad Limited
based on Trinidad Limited’s own actions, separate and apart from any liability that might accrue
based on its subsidiary’s actions. Therefore, there is no question that Plaintiffs may assert their
claims against Trinidad Limited.
Page 14
More to the point, there can be no dispute as to the merits of Plaintiffs’
claims at this stage of the proceeding, because a court may not examine the merits
on a special appearance. See, e.g., Nogle & Black Aviation, Inc. v. Faveretto, 290
S.W.3d 277, 284 (Tex. App.—Houston [14th Dist.] 2009, no pet.). Instead, the
allegations regarding the merits must be taken as true at the special-appearance
stage. E.g., Id. (“We take the allegations in the petition as true at the special
appearance stage.”).
Therefore, the only question is whether Plaintiffs can pursue their claims
against Trinidad Limited in Texas—in the same court and at the same time as all
their other claims—or whether Plaintiffs will be required to bring an additional
suit, in another forum that is far from their residences and far from the location
where the accident occurred. As such, the only two factual issues that can be
considered on this special appearance are: (1) whether Trinidad Limited exercised
control over, or issued operational policies for, aspects of drilling operations; and
(2) whether Trinidad Limited knew or intended that such control or policies would
extend to operations in Texas. As shown in the following two subsections, the
evidence and undisputed allegations demonstrate that both questions must be
answered in the affirmative.
Page 15
B. The evidence and uncontroverted allegations show Trinidad Limited
set operational policies and exercised operational control over
Trinidad L.P.’s drilling operations in Texas.
1. The uncontroverted allegations show that Trinidad Limited
exercised operational control and set operational policies for
Trinidad L.P.
The first factual issue—whether Trinidad Limited set operational policies
and exercised operational control over drilling operations—is straightforward, as it
can be decided based on Plaintiffs’ uncontroverted allegations. In part, Plaintiffs
alleged that:
 Trinidad Limited “directs, controls and supervises the HSE
(Health, Safety and Environment) of the drilling operations of
TRINIDAD, LP,” C.R.35-36 ¶ 3.03;
 Trinidad Limited “investigates, creates and issues policy
manuals and procedures for [Trinidad L.P.],” C.R.35-36 ¶ 3.03;
and
 “At all relevant times” Trinidad Limited “exercised . . . control
and took responsibility for overseeing safety policies and
procedures for the crews on the drilling rigs,” C.R.38 ¶ 4.07.
Trinidad Limited purports to controvert these allegations in paragraphs15-17
of the affidavit accompanying its Amended Special Appearance:
15. Trinidad Drilling Limited does not control the payroll of Trinidad
LP.
16. The directors of Trinidad Limited do not make decisions to
control the day to day operations of Trinidad LP,
17. Trinidad Drilling Limited does not control any of the day to day
sales offered by Trinidad LP in Texas.
Page 16
C.R.29 (emphasis added). However, these qualified statements avoid
controverting the particular allegations that were actually made by Plaintiffs.
First, there are no statements (either in this affidavit or the subsequent
affidavit in August 2014) that address the issue of control “[a]t all relevant times.”
See C.R.38 ¶ 4.08. In other words, all statements regarding control are made in the
present tense. Thus, none of the statements address the key question of whether
Trinidad Limited exercised control or took responsibility during “the relevant
time” of 2010, when the accident occurred. As such, Plaintiffs’ allegations of
control and responsibility in paragraph 4.07 of its Third Amended Petition must be
taken as true. See, e.g. Nogle & Black Aviation, Inc., 290 S.W.3d at 284.
Moreover, leaving aside the issue of timing, the statements of Trinidad
Limited’s affiant still avoid addressing the allegations made by Plaintiffs. In
paragraph 15, the affidavit addresses only control of “payroll,” and does not
address control of safety or drilling operations. See C.R.29 In paragraph 17, the
affidavit addresses only control of “day to day sales,” and does not address control
of safety or drilling operations. See C.R.29.
The qualifications in paragraph 16 are even more disingenuous. This
paragraph does purport to address control of “operations” but only in the sense of
“day to day” operations. More importantly, it addresses only control by
“directors,” a qualification that can only be intended to obfuscate the true facts.
Page 17
C.R.29. The role of “directors” is never to control the day-to-day operations of a
company. Instead, such control is exercised by officers, employees, and agents.
But the affidavit is completely silent as to the control of Trinidad L.P.’s operations
through such persons.
In short, these allegations of Plaintiffs’ live pleading were never
controverted by Trinidad Limited.4 As such, these allegations must be taken as
true, and the trial court was therefore required to find that Trinidad Limited
exercises control over the safety of Trinidad L.P.’s drilling operations, and that it
did so at the relevant time period.
2. Even if Plaintiffs’ allegations had been controverted, the
great weight of evidence demonstrates that Trinidad Limited
retained the right to control, and set operational policies for,
drilling operations.
Because the relevant allegations were not controverted, the inquiry is ended
on this issue. Plaintiffs’ allegations must be taken as true, and the Court need not
(and cannot) consider any additional evidence.
Nevertheless, if the Court were to consider additional evidence, the great
weight of such evidence supports Plaintiffs’ allegations. First, Trinidad Limited
maintained a superintendent (Brent Kryzanowski) devoted specifically to the type
of drilling rig—a so-called “top drive” rig—that is at issue in this case. See, e.g.
4
These failures in the affidavit were expressly pointed out by Plaintiffs’ response below.
See, e.g., C.R.51-52.
Page 18
C.R.80; Supp. C.R.41. This superintendent was involved in the oversight of
Trinidad L.P.’s drilling operations, and it was this superintendent whose emails
provided evidence that Trinidad Limited had prior notice of similar accidents. See,
e.g. C.R.80; Supp. C.R.41.
Similarly, a report of Rodney Foreman, as “General Manager of Corporate
HSE” of “Trinidad Drilling Ltd.,” demonstrated that Trinidad Limited retained
control over the operational details of the drilling operations and crews. See
C.R.79. More specifically, Mr. Foreman’s report of this particular incident also
outlined the “Remedial Action Plans” to be rolled out by the Trinidad Limited’s
“US Northern, US Southern, [and] Canadian Drilling” divisions. C.R.80. These
plans did not merely set general policies; rather, they involved specific actions
regarding the on-site equipment and crews. See C.R.80 (discussing “Phase 1”).
While these subsequent remedial measures are not admissible to prove negligence
(which is not at issue on this motion),5 they are admissible to prove that Trinidad
Limited retained “control” over aspects of the drilling operations, including the
safety aspects. See Tex. R. Evid. 407.
Although Trinidad Limited contends Mr. Foreman was employed and paid
by Trinidad L.P., these contentions are irrelevant to the analysis. Whether or not
5
As noted above in section V(A)(1), the question of negligence cannot be inquired to on
a special appearance. Instead, the Court must accept the allegations of negligence as true.
Page 19
Mr. Foreman was paid by Trinidad Limited or whether he wore additional “hats”
for Trinidad L.P., the undisputed evidence demonstrates that he was also acting on
behalf of Trinidad Limited (the parent company) in connection with this report:
 First, in his emails, he holds himself out as representing the
parent company, as “General Manager of Corporate HSE” of
“Trinidad Drilling Ltd..” C.R.79. Moreover, this was done with
the full knowledge of Trinidad Limited’s highest officers. See,
e.g., C.R.79-80 (sent to CEO, Executive VP, etc.). In fact,
during the relevant time period, Trinidad Limited itself held out
Mr. Foreman as its own “General Manager of Corporate HSE”
in its public communications. Supp. C.R.313.
 Second, Mr. Foreman testified that he reported to Ed Oke, and
he referred to Ed Oke as his “boss.” C.R.90-91. However, Mr.
Oke was the “Vice-President Human Resources and Safety” of
“Trinidad Drilling Ltd.” (i.e., the parent company), as opposed
to the officer of Trinidad L.P. C.R.75-76, C.R.90, Supp.
C.R.329.
 Third, the Remedial Action Plans were not limited to Trinidad
L.P. Rather they applied to all of Trinidad Limited’s operations
in both the United States and Canada. C.R.80. And it was Mr.
Page 20
Foreman who was to provide instruction and receive
information from each of the division vice presidents (of the
parent company) in their implementation of the plans.
In any event, regardless of Mr. Foreman’s role in the Remedial Action Plans,
the nature of the plans makes clear that they were made by Trinidad Limited (the
parent company). Recipients of the report were officers or employees of Trinidad
Limited (the parent company), the remedial plans applied to operations in both the
United States and Canada, and implementation of the plans expressly required the
assistance and approval of the division vice presidents. Thus, the weight of
evidence shows that Trinidad Limited retained control over, and set safety policies
for, on-site drilling operations.
In its briefing before the trial court, Trinidad Limited argued that
“[a]ppropriate parental involvement includes monitoring the subsidiary's
performance, supervision of the subsidiary's finance and capital budget decisions,
and articulation of general policies. C.R.23 (quoting PHC-Minden, L. P. v.
Kimberly Clark, Corp., 235 S.W.3d 163, 176 (Tex. 2007)). However, such
argument is irrelevant for two relatively-obvious reasons.
First, the quoted language is not relevant to the question of a parent
company’s own minimum contacts. Rather, it is a statement regarding the degree
of control needed to pierce the corporate veil, such that the parent and subsidiary
Page 21
are treated as one and the same. However, that is not the theory advanced by
Plaintiffs here. Instead, Plaintiffs have alleged that Trinidad Limited is subject to
liability and jurisdiction based on its own acts. In such cases, the question is not
whether the parent has exercised an inordinate amount of control, but rather
whether the cause of action arises from whatever control is exercised. In other
words, even articulation of a “general policy” could lead to jurisdiction, if the
claim arose from the particular policy.
Perhaps more importantly, the control retained in this case goes well beyond
the principles described in PHC-Minden. As shown by the undisputed facts and
evidence above, Trinidad Limited’s actions were not limited to “monitoring.” Nor
do the allegations involve “finance or capital budget decisions.” Nor do they
involve “general policies.” Instead, Plaintiffs have alleged that Trinidad Limited’s
control extended to the operation aspects of the drilling operations, and in
particular, that Trinidad Limited “took responsibility for overseeing safety policies
and procedures for the crews on the drilling rigs” during the relevant time period.
See C.R.38 ¶ 4.07. Moreover, the undisputed evidence shows that it retained
control over operation policies regarding both: (1) modification of actual drilling
equipment; and (2) activities of on-site personnel. See C.R.80 (discussing “Phase
I”).
Page 22
Finally, Plaintiffs’ allegations are supported by Trinidad Limited’s own
evidence regarding its officers’ and employees’ travel to Texas during the relevant
time period. In response to the Amended Special Appearance, Plaintiffs pointed
out that Trinidad Limited’s officers and employees had made 126 trips to Texas
during the years preceding the accident, including multiple trips by Ed. Oke, its
vice president of health, safety, and environment issues. See, e.g., C.R.58; C.R.68-
69. Trinidad Limited acknowledges these trips were made to Texas, that they were
for the purpose of “getting [Trinidad L.P.] up and running” and making it
“operable,” and that the trips were made to protect Trinidad Limited’s interests.
C.R.115. While such testimony might be useful in the alter-ego context, it
undercuts any argument Trinidad Limited might make as to jurisdiction for its own
negligence.6 Regardless of what control Trinidad Limited now exercises, this
testimony demonstrates that: (1), Trinidad Limited was exercising a significant
amount of control during the period extending through mid-2010; (2) the control
was, at least in part, conducted by “officers and managers” with a physical
connection to Texas; and (3) the control was intended for Trinidad Limited’s
benefit. See C.R.115. Indeed, Trinidad Limited acknowledged that corporations
6
Trinidad Limited also asserts that its officers and managers were merely setting up
operations (i.e. making the subsidiary “operable” and “getting it up and running”), rather than
“conducting marketing activities [or] promoting services to customers.” C.R.115 ¶ 17.
However, such contentions are irrelevant to this analysis, as Plaintiffs’ claims do not arise from
“marketing activities” or “promoting services.” The claims arise from allegations that Trinidad
Limited controlled aspects of drilling operations, and Trinidad Limited’s affidavit merely
confirms that its officers and employees exercised such control during the relevant time period.
Page 23
“require work from people,” and as the Supreme Court has made clear, a
corporation is responsible for the actions of its “people”—officers, directors,
employees, and agents. See Internat’l Shoe v. Washington, 326 U.S. 310, 316
(1945) (noting that a corporation's presence, for personal jurisdiction purposes, is
“manifested only by activities carried on in its behalf by those who are authorized
to act for it”). In this case, Trinidad Limited’s own evidence shows that its own
people set up operational policies and exercised control over Trinidad L.P.’s
operations during the relevant time period, and some of those people made actual,
physical contact with the state of Texas.
C. Trinidad Limited knew and intended that its control would extend to
drilling operations in Texas and that Texas residents would bear the
risk of any negligent policies or control.
In short, Trinidad Limited retained control over, and set policies for, the
safety of its drilling operations. See supra, Section V(B). Furthermore, Plaintiffs
have alleged that Trinidad Limited did so negligently, and Plaintiffs’ claims arise
from such negligence, See supra, Section V(A) (noting that Plaintiffs’ allegations
of negligence are taken as true). Therefore, the only remaining factual question is
whether Trinidad expected that the control and policies would extend to drilling
operations in Texas.
On this question, there is no dispute. Plaintiffs have alleged not only that
Trinidad Limited controlled the safety aspects of Trinidad L.P., but that it did so as
Page 24
to “drilling practices in Texas.” C.R.38 ¶ 4.09; see also C.R.35-36 ¶ 3.03; C.R.38
¶ 4.07. Trinidad Limited has not controverted these allegations. Nor could it do
so, as there is no dispute that Trinidad L.P. conducted its operations—including the
drilling operation that resulted in Nabor Alvarado’s death—in Texas.
The only conceivable argument that Trinidad Limited could make would be
to argue that the connections to Texas were the result of “unilateral activity of
another party or third person.” Guardian Royal Exch. Assurance, Ltd. v. English
China Clays, 815 S.W.2d 223 at 226 (Tex. 1991) (citations omitted). Specifically,
Trinidad Limited would have to argue that the decisions to conduct drilling
operations in Texas were made solely by Trinidad L.P., without the knowledge or
approval of its parent, Trinidad Limited. But Trinidad Limited has not made such
an argument, which would be nonsensical given the scope of Trinidad L.P.’s
operations and its importance to Trinidad Limited’s business.
In any event, the undisputed evidence shows that Trinidad Limited not only
knew that drilling operations would be conducted in Texas, but that Trinidad
Limited actively participated in the formations of such operations. On this point, a
couple of examples will suffice.
First, Trinidad Limited’s officers and employees admittedly made 126 trips
to Texas in the time period preceding the accident, in order to make Trinidad L.P.
“operable” and to get it “up and running.” See C.R.115. These trips have already
Page 25
been discussed in the context of whether Trinidad Limited controlled aspects of
Trinidad L.P.’s drilling operations during the relevant time period. See supra,
Section V(B)(2). However, they are even more significant on this point, as they
indisputably demonstrate that Trinidad Limited’s management knew and intended
that Trinidad L.P. would conduct drilling operation in Texas.
Perhaps even more damning, the undisputed evidence shows that Trinidad
Limited knew of, intended, and supported the particular drilling operations that
resulted in Nabor Alvarado’s death in Texas. More specifically, Plaintiffs’
submitted invoices showing that Trinidad Limited purchased the very rig—the “top
drive” Rig no. 130—that resulted in his death. See C.R.51; C.R.65-66; C.R.81.
However, Trinidad Limited contends that the rig was not purchased by Trinidad
Limited, but that Trinidad Limited financed the transaction “on behalf of” its
subsidiary. Supp. C.R.356 ¶ 24. Moreover, the testimony stated that the financing
was expressly intended to allow Trinidad L.P. to satisfy a drilling contract in “the
Fort Worth basin” in Texas. See Supp. C.R.356 ¶ 24; Supp. C.R.444. As such,
Trinidad Limited not only knew of, but actively supported, drilling operations in
Texas—drilling operations to which its policies and control would apply.
Therefore, the undisputed evidence shows that Trinidad Limited knew, and
fully intended, that its control and policy-making would extend to drilling
operations in Texas—and even to the drilling operations that resulted in Nabor
Page 26
Alvarado’s death. Likewise, Trinidad Limited knew that Texas residents would
bear the risk of harm from the any negligence in such policies.
D. Therefore, Trinidad Limited is subject to specific jurisdiction, as it
could “reasonably anticipate being haled into Court” in Texas and
the exercise of jurisdiction would not offend fair play and
substantial justice.
As discussed above in Section III, the issue of due process involves: (1)
whether the non-resident defendant has sufficient minimum contacts with the State
of Texas to avail itself of jurisdiction; and, (2) whether the exercise of personal
jurisdiction over the nonresident defendant offends the notions of fair play and
substantial justice. E.g., Internat’l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945). More specifically, Trinidad Limited has the burden to establish that due
process is not satisfied. See, e.g., Nat’l Indus. Sand Ass'n v. Gibson, 897 S.W.2d
769, 772 (Tex. 1995). However, in this case, Trinidad Limited has not negated
either element.
For specific jurisdiction, the minimum-contacts requirement is satisfied if:
(1) the defendant's activities were purposefully directed toward the forum state;
and (2) there is a substantial connection between the defendant's forum contacts
and the operative facts of the litigation. E.g. Helicopteros Nationales de
Columbia, S.A. v. Hall, 466 U.S. 408, 414 n.8 (1984). This test does not require
that the defendant “physically enter the forum State.” Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 475 (1985). Instead, the defendant need only have
Page 27
purposefully directed in such a manner that it “should reasonably anticipate being
haled into court” in the forum state. Id. (quoting World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 297 (1980)); see also Guidry v. U.S. Tobacco Co., Inc.,
188 F.3d 619, 628-630 (5th Cir. 1999).
In this case, the foregoing subsections demonstrate that:
1. Trinidad Limited exercised control over, set policies for, and took
responsibility for aspects of Trinidad L.P.’s drilling operations in
Texas, see supra, Section V(B);
2. Trinidad Limited knew and intended that Trinidad L.P.’s drilling
operations would be conducted in Texas, and that its control and
policy-setting would therefore extend to Texas operations, see supra,
Section V(C); and
3. Plaintiff has alleged that Trinidad Limited was negligent in exercising
control and setting policies, and Plaintiff’s claims arise from such
negligence, see supra, Section V(A).
In short, Trinidad limited knew that its control and policy-setting would apply to
actions in Texas and that Texas citizens would bear the risk of any negligence in
such actions. In other words, Trinidad Limited could “reasonably anticipate being
haled into court” in Texas. Therefore, Trinidad Limited has failed to negate the
minimum-contacts element of due process.
Likewise, Trinidad Limited has failed to negate the “fair play and substantial
justice” aspect of due process. See, e.g., As-ahi A1etal Industries Co. v. Superior
Court, 480 U.S, 102, 113 (1987) (listing factors). Given the heightened protections
that have developed in the minimum-contacts analysis over the years, a finding of
Page 28
minimum contacts will also satisfy this aspect of due process, except in “rare
cases.” See Guardian Royal Exch. Assurance, Ltd. v. English China Clays, 815
S.W.2d 223, 231 (Tex. 1991) (citations omitted). And this is not such a case.
Here, the interests of Plaintiffs (who include minor children) “in obtaining
convenient and effective relief” obviously weighs in favor of retaining jurisdiction.
If jurisdiction is retained, then it is likely all claims against all parties can be tried
in the same case, in a convenient forum in the same state in which the accident
occurred. In contrast, dismissal would require the Plaintiffs to bring a separate suit
in a distant and unrelated forum. For the same reasons, Texas’s “interest in
adjudicating the dispute” and the judicial system’s “interest in obtaining the most
efficient resolution of controversies” both weigh in favor of retaining jurisdiction.
By comparison, the “burden” on Trinidad Limited is relatively light. Although
Texas is far from its place of incorporation, Trinidad Limited has proven itself able
to adjudicate in this forum, just as it has proven itself able to create a subsidiary to
conduct drilling operations in Texas, to get that subsidiary’s operations “up and
running,” and then to reap millions of dollars in profits from those operations.
In summary, Trinidad Limited has failed to present a “compelling case” that
jurisdiction is unreasonable. See Burger King Corp., 471 U.S. at 477. If anything,
this is one of those cases in which the interests of fair play and substantial justice
Page 29
“serve to establish the reasonableness of jurisdiction upon a lesser showing of
minimum contacts than would otherwise be required.” Id.
Therefore, Trinidad Limited has failed to show that due process is not
satisfied. Instead, the undisputed facts and evidence demonstrate that Trinidad
Limited is subject to specific jurisdiction, and the trial court’s decision must be
reversed on this basis.
VI. Trinidad Limited is also subject to general jurisdiction based on its own
acts.
In addition to demonstrating that Trinidad Limited is subject to specific
jurisdiction, Plaintiff has also produced evidence showing that Trinidad Limited is
subject to general jurisdiction in Texas. General jurisdiction is applicable if the
defendant’s activities reveal a pattern of “continuing and systematic activity”
connected to the state. Schlobohm v. Schapiro, 784 S.W.2d 355, 359 (Tex. 1990).
This test does not require physical presence in the state. See, e.g., Temperature
Sys., Inc. v. Bill Pepper, Inc., 854 S.W.2d 669, 676 (Tex. App. –Dallas 1993, writ
dism'd by agr.) (purchases from Texas residents and relationship with Texas
distributor established minimum contacts) and Design Info. Sys. v. Feith Sys. &
Software, Inc., 801 S.W.2d 569, 571 (Tex. App.—Fort Worth 1990, no writ), rev'd
in part on other grounds, 813 S.W.2d 481 (Tex. 1991) (twenty-five customers in
Texas established minimum contacts).
Page 30
Although the discussion in the previous section focused on specific
jurisdiction, much of the same evidence would apply to an analysis of general
jurisdiction. For instance, in addition to allegations that Trinidad Limited
controlled aspects of drilling operations at the “relevant times” regarding the
accident, Plaintiffs have alleged that Trinidad Limited also exercised control and
sets policies in the present tense. See, e.g. C.R.35-36 ¶ 3.03. Likewise, Plaintiffs
produced evidence showing that such control was reinforced by 126 actual,
physical visits to Texas by Trinidad Limited’s own officers and employees through
the time of the accident.7
Moreover, the previously-discussed evidence demonstrates that Trinidad
Limited had an employee, or at least an agent, that maintained a physical presence
in Texas. More specifically, Rodney Foreman, as “General Manager of Corporate
HSE” of “Trinidad Drilling Ltd.,” maintained his office in or around the Houston
area. See C.R.79 (showing “office” phone number with 713 area code).8 Trinidad
Limited contends that Mr. Foreman is an employee or officer of Trinidad L.P. and
was paid by Trinidad L.P. However, even if true, these contentions do not
controvert the fact that Mr. Foreman was also an agent of Trinidad Limited, at the
7
In response to the Amended Special Appearance, Plaintiffs moved to compel discovery
responses as to subsequent visits to Texas but did not obtain a ruling prior to the Court sustaining
Appellee’s special appearance.
8
The Court can take judicial note that 713 is the area code for the Houston area.
Page 31
very least. See supra, Section V(B)(2) (discussing issue). Mr. Foreman held
himself out as the “General Manager of Corporate HSE” of “Trinidad Drilling
Ltd.” with the full knowledge of Trinidad Limited’s highest officers. C.R.79-80.
Likewise, Trinidad Limited did the same in its own official presentations to the
outside world. Supp. C.R.313. Second, Mr. Foreman testified that he reported to
Ed Oke, and he referred to Ed Oke as his “boss.” C.R.90-91. Yet Mr. Oke was
the “Vice-President Human Resources and Safety” of “Trinidad Drilling Ltd.” (i.e.,
the parent company), as opposed to the officer of Trinidad L.P. C.R.75-76,
C.R.90, Supp. C.R.329. Therefore, whatever “hats” Mr. Foreman might have
worn for Trinidad L.P., he also wore the “General Manager of Corporate HSE”
“hat” for Trinidad Limited. And he did so from a physical office within the state of
Texas. See C.R.79.
Finally, Trinidad Limited’s own annual reports reveal that its “banker” has
been “Wells Fargo, N.A.” in “Houston, Texas,” and that it has a director who
resides in Texas. See, e.g., Supp. C.R.237; C.R.267; C.R.300; C.R.329; C.R.348.
Trinidad Limited contends that it does not bank with Wells Fargo, but rather that
Wells Fargo is used by Trinidad L.P. But that is not what the annual reports say.
To the contrary, the annual reports all define “Trinidad” and the “Company” as
“Trinidad Drilling Ltd.”. See, e.g., Supp. C.R.288; Supp. C.R.322 Moreover,
Trinidad Limited’s “bankers” and “directors” are listed on its “Corporate
Page 32
Information” page, and all of the information on this page refers to “Trinidad
Limited.” See, e.g., Supp. C.R.237 (listing only Trinidad Limited’s officers,
directors, etc.).
As the Southern District of New York has so aptly noted: “There cannot be
one ‘truth’ for the world at large, and a different ‘truth’ for the Court.” See
Twentieth Century Fox Film Corp. v. Marvel Enterprises, Inc., No. 01 CIV.
3016(AGS)(HB), 2002 WL 1835439, *5 n.2 (S.D.N.Y. 2002).9 In this case,
Trinidad Limited’s self-serving contentions do not controvert the bulk of the
evidence showing that Trinidad Limited has maintained continuous and systematic
contacts with Texas. As such, the great weight and preponderance of evidence
demonstrates that Trinidad Limited is subject to general jurisdiction. Moreover,
even if this were not the case under ordinary standards, the fair-play and
substantial-justice factors, discussed in the prior section, are such that Trinidad
Limited’s contacts would “serve to establish the reasonableness of jurisdiction
upon a lesser showing of minimum contacts than would otherwise be required.”
See Burger King Corp., 471 U.S. at 477.
Therefore, the trial court’s decision should be overruled on this additional
basis.
9
See Appellants’ Appendix A.
Page 33
VII. Prayer
For the reasons stated above, Appellants respectfully pray that this Court
reverse the trial court, render a decision denying Trinidad Limited’s special
appearance, and remand this action for proceedings on the merits.
Respectfully submitted,
By /s/ Geoffrey E. Schorr
Geoffrey E. Schorr
geoff@schorrfirm.com
Texas Bar No. 24029828
A. Jared Aldinger
Texas Bar No. 24068456
jared@schorrfirm.com
SCHORR LAW FIRM, PC
328 W. Interstate 30, Suite 2
Garland, TX 75043
Tel. (972) 226-8860
Fax (972) 226-9787
Hutton W. Sentell
Texas Bar No. 24026655
hsentell@ashmorelaw.com
ASHMORE LAW FIRM, P.C.
3636 Maple Ave.
Dallas, TX 75219
Tel. (214) 559-7202
Fax (214) 520-1550
Andrew P. McCormick
Texas Bar No. 3457100
amccormick@mlm-lawfirm.com
McCORMICK, LANZA & McNEEL, LLP
4950 Bissonnet Street
Bellaire, TX 77401
Tel. (713) 523-0400
Page 34
Fax (713) 523-0408
ATTORNEYS FOR
PLAINTIFFS/APPELLANTS ADELAIDA
SALAZAR BAUTISTA a/k/a ADELAIDA
ALVARADO, Individually, and as next
friend of MARIA JENNIFER AIDE a/k/a
MARIA JENNIFER ALVARADO,
AURELIA ALVARADO, ALEJANDRA
ALVARADO, IVAN SALAZAR
ALVARADO, MARIAN ALVARADO, and
EDUARDO ALVARADO, Minors
and
By: /s/ Justin K. Hall
Justin K. Hall
Texas Bar No. 90001828
jkhall@justinkhall.com
328 W Interstate 30, Suite 2
Garland, Texas 75043
Tel. (972) 226-1999
Fax (972) 226-2221
Attorney for Plaintiffs, Irineo Alvarado and
Maria Ana Moctezuma
Page 35
CERTIFICATE OF COMPLIANCE
I hereby certify that this brief complies with the type-volume limitation of
TEX. R. APP. P. 9.4(i)(2)(B) because it contains 7,911 words, excluding the parts of
the brief exempted by TEX. R. APP. P. 9.4(i)(1). In making this certification, I
am relying on a word count performed by the Microsoft Word software used to
prepare this brief.
By /s/ Geoffrey E. Schorr
Geoffrey E. Schorr
CERTIFICATE OF SERVICE
I hereby certify that on January 21, 2015, a true and correct copy of this
Appellants’ Brief was served on counsel for Appellee via: the Texas e-file system
which will send a notice of this electronic filing to Michael Beckelman, at his
email address on file with the electronic filing manager.
By /s/ Geoffrey E. Schorr
Geoffrey E. Schorr
Page 36
No. 01-14-00892-CV
In the Court of Appeals
for the First Judicial District
Houston, Texas
ADELAIDA SALAZAR BAUTISTA A/K/A ADELAIDA ALVARADO,
INDIVIDUALLY AND AS NEXT FRIEND OF MARIA JENNIFER AIDE
A/K/A MARIA JENNIFER ALVARADO, A. A. A. A., I. S. A., M. A., AND E.
A., MINORS; AND IRINEO ALVARADO AND MARIA ANA MOCTEZUMA,
Appellants,
v.
TRINIDAD DRILLING LIMITED,
Appellee.
On Appeal from the
270th Judicial District Court of Harris County
APPENDIX TO APPELLANTS’ BRIEF
APP DESCRIPTION
A. Twentieth Century Fox Film Corporation v. Marvel Enterprises, Inc.,
2002 WL 1835439 (S.D.N.Y.)
Page 1
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
May Be Taken
170Ak1325 k. Officers and employ-
ees of corporations. Most Cited Cases
Only the Westlaw citation is currently available.
Entity receiving notice of deposition must pro-
United States District Court, S.D. New York.
duce witness prepared with knowledge of both the
TWENTIETH CENTURY FOX FILM CORPORA-
entity that received the subpoena and its subsidiaries
TION, Plaintiff,
or affiliates. Fed.Rules Civ.Proc. Rule 30(b)(6), 28
v.
U.S.C.A.
MARVEL ENTERPRISES, INC., et al., Defendants.
No. 01 CIV. 3016(AGS)(HB). [2] Federal Civil Procedure 170A 1534
Aug. 8, 2002.
170A Federal Civil Procedure
Plaintiff, a licensee of copyrighted characters, 170AX Depositions and Discovery
brought copyright infringement suit against parent 170AX(D) Written Interrogatories to Parties
corporation that owned television station that aired 170AX(D)3 Answers; Failure to Answer
program allegedly based on the copyrighted charac- 170Ak1534 k. Sufficiency; supplemen-
ters. Plaintiff sought order directing defendant to tation of answers. Most Cited Cases
produce a witness who was properly prepared to tes-
tify concerning certain documents allegedly produced Corporation responding to interrogatories must
by the television station concerning the program. The provide not only the information contained in its own
District Court, Pittman, Magistrate Judge, held that files and possessed by its own employees, it must also
defendant would be required to provide such a wit- provide all information under its control; thus, when
ness, given defendant's control over the television the parent is served with an interrogatory, it is no
station. defense to claim that the information is within the
possession of a wholly owned subsidiary, because
So ordered. such a corporation is owned and controlled by such
interrogee. Fed.Rules Civ.Proc. Rule 30(b)(6), 28
U.S.C.A.
West Headnotes
[3] Copyrights and Intellectual Property 99 84
[1] Federal Civil Procedure 170A 1325
99 Copyrights and Intellectual Property
170A Federal Civil Procedure
99I Copyrights
170AX Depositions and Discovery
99I(J) Infringement
170AX(C) Depositions of Parties and Others
99I(J)2 Remedies
Pending Action
99k72 Actions for Infringement
170AX(C)1 In General
99k84 k. Discovery. Most Cited
170Ak1323 Persons Whose Depositions
Cases
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A
Page 2
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
preliminary injunction and defendants' motion to
Parent corporation that owned and operated tele- dismiss, Twentieth Century Fox Film Corp. v. Marvel
vision station would be required to provide, in re- Enters., Inc., 155 F. Supp. 2d 1 (S.D.N.Y.2001), aff'd,
sponse to notice of deposition, a witness prepared with Twentieth Century Fox Film Corp. v. Marvel Enters.,
knowledge of the television station to testify con- Inc., 277 F.3d 253 (2d Cir.2002). Familiarity with
cerning certain documents that were apparently pro- both of these decisions is assumed. For present pur-
duced by television station and that were relevant to poses it is sufficient to note that plaintiff is the licensee
litigation over copyrighted cartoon characters; cor- of copyrighted characters created by defendant Marvel
poration's control over television station was estab- Enterprises, Inc., and known as the X–MEN. In July,
lished by its public statements, including its internet 2000, pursuant to its license, plaintiff released a full
web page, which stated that it owned and operated 23 length, live action motion picture based on these
major-market television stations, including station at characters, entitled “X–MEN.” Plaintiff alleges,
issue. Fed.Rules Civ.Proc., Rule 30(b)(6), 28 among other things, that defendant Tribune Enter-
U.S.C.A. tainment's television program, MUTANT–X, in-
fringes on plaintiff's rights in the X–MEN and that
defendants have attempted to pass off their MU-
Diana M. Torres, Esq., Samantha L. Hetherington,
TANT–X television program as being related to
Esq., Dale M. Cendali, Esq., O'Melveny & Myers,
plaintiff's motion picture.
LLP, New York.
The present dispute has its genesis in a subpoena
Jonathan D. Reichman, Esq., John R. Hutchins, Esq.,
served on Tribune Broadcasting, the parent of de-
Dana R. Kaplan, Esq., Kenyon & Kenyon, New York.
fendant Tribune Entertainment Company. In response
to a subpoena duces tecum, Tribune Broadcasting
Maura J. Wogan, Esq., Gerald Singleton, Esq.,
produced a document on “WGN” letterhead.
Frankfurt, Garbus, Klein & Selz, New York.
WGN–TV and WGN Superstation are a local Chicago
television station and a cable television station, re-
Steven H. Rosenfeld, Esq., Ohrenstein & Brown, spectively, that are both owned and operated by
L.L.P., New York. Tribune Broadcasting; the letterhead on the document
in issue merely states “WGN Entertaining America,”
MEMORANDUM OPINION AND ORDER with no further description. The document appears to
PITMAN, Magistrate J. be a script for a sales presentation and suggests that
I. Introduction there is a close association between plaintiff's X–MEN
*1 Plaintiff seeks an Order either permitting it to motion picture and defendants' MUTANT–X televi-
take an additional deposition beyond the limit of thirty sion program.
depositions per side that has been imposed in this case
or directing Tribune Broadcasting Company (“Trib- Tribune Broadcasting's 30(b)(6) witness denied
une Broadcasting”) to produce a 30(b)(6) witness knowledge of the document and stated that it was a
properly prepared to testify concerning certain doc- WGN document FN1; he did not specify whether he
uments. was referring to WGN–TV or WGN Superstation. As
a result of that testimony, plaintiff served a further
II. Facts subpoena and deposition notice. The subpoena was
The facts in this case are fully set forth in Judge addressed to “WGN–TV, 2501 W. Bradley Place,
Schwartz's decision addressing plaintiff's motion for a Chicago, IL 60618” (Torres 7–16–02 Ltr., Ex. B). The
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A
Page 3
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
accompanying notice of deposition was addressed to In connection with the current dispute, both sides
“WGN–TV/Superstation (Chicago),”, and the sched- have each submitted three letter briefs. In addition, as
ule attached to the subpoena defined “WGN” as noted above, I heard oral argument by telephone on
July 30, 2002..
FN1. The topics listed in the Rule 30(b)(6)
notice served on Tribune Broadcasting in- III. Analysis
cluded “The advertising, marketing, sale [1] The current dispute raises the issue of whether
and/or promotion of [defendants' television an entity receiving a notice of deposition pursuant to
series]” (Letter of Diana M. Torres, Esq., Rule 30(b)(6) is obligated to produce a witness pre-
dated July 16, 2002 (“Torres 7–16–02 Ltr.”), pared with the knowledge of both the entity that re-
at 1, n. 1). ceived the subpoena and its subsidiaries or affiliates. I
conclude that the scope of the entity's obligation in
WGN–TV/Superstation and any of its predecessor responding to a 30(b)(6) notice is identical to its scope
and successor entities, affiliates, subsidiaries, in responding to interrogatories served pursuant to
agents, servants, representatives, and/or attorneys, Rule 33 or a document request served pursuant to Rule
and all other persons acting or purporting to act on 34, namely, it must produce a witness prepared to
WGN's behalf testify with the knowledge of the subsidiaries and
(Torres 7–16–02 Ltr., Ex. B). The schedule attached affiliates if the subsidiaries and affiliates are within its
to the subpoena annexed a copy of the document control.
described above and designated it as a subject of
examination. It is well settled that a witness appearing pursuant
to a Rule 30(b)(6) notice has a unique status and tes-
*2 In response to this subpoena, a witness from tifies as the entity, not as an individual. “A deposition
WGN–TV was produced. Like the witness produced pursuant to Rule 30(b)(6) is substantially different
on behalf of Tribune Broadcasting, he also disclaimed from a witness's deposition as an individual. A
knowledge of the document in dispute and claimed 30(b)(6) witness testifies as a representative of the
that it appeared to be a script from WGN Superstation. entity, his answers bind the entity and he is responsi-
ble for providing all the relevant information known or
reasonably available to the entity.” Sabre v. First
According to statements made in the course of
Dominion Capital, LLC, 01 Civ. 2145(BSJ)(HBP),
oral argument concerning the current dispute held on
2001 WL 1590544 at *1 (S.D.N.Y. Dec. 12, 2001),
July 30, 2002, neither WGN–TV nor WGN Super-
citing 8A Charles A. Wright, Arthur R. Miller, Rich-
station is a legally cognizable entity; both are owned
ard L. Marcus, Federal Practice & Procedure § 2103
by several corporations which are ultimately owned
(2d ed.1994). As comprehensively explained by
by Tribune Broadcasting.
Magistrate Judge Eliason of the Middle District of
North Carolina:
I had previously limited each side in this case to a
total of thirty depositions. Since the deposition re-
The testimony elicited at the Rule 30(b)(6) depo-
sulting from plaintiff's subpoena to WGN–TV was
sition represents the knowledge of the corporation,
plaintiff's thirtieth deposition, it cannot now seek a
not of the individual deponents. The designated
deposition of WGN Superstation without relief from
witness is “speaking for the corporation,” and this
the Court.
testimony must be distinguished from that of a
“mere corporate employee” whose deposition is not
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A
Page 4
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
considered that of the corporation and whose pres- ther, the corporation may designate a person to
ence must be obtained by subpoena. 8A Wright, speak on its behalf and it is this position which the
Miller & Marcus § 2103, at 36–37.... If the persons attorney must advocate.
designated by the corporation do not possess per-
sonal knowledge of the matters set out in the depo- ... Rule 30(b)(6) explicitly requires [a corpora-
sition notice, the corporation is obligated to prepare tion] to have persons testify on its behalf as to all
the designees so that they may give knowledgeable matters known or reasonably available to it and,
and binding answers for the corporation. Dravo therefore, implicitly requires such persons to review
Corp. v. Liberty Mut. Ins. Co., 164 F.R.D. 70, 75 all matters known or reasonably available to it in
(D.Neb.1995) (citing Marker, 125 F.R.D. at 126). preparation for the Rule 30(b)(6) deposition. This
Thus, the duty to present and prepare a Rule interpretation is necessary in order to make the
30(b)(6) designee goes beyond matters personally deposition a meaningful one and to prevent the
known to that designee or to matters in which that “sandbagging” of an opponent by conducting a
designee was personally half-hearted inquiry before the deposition but a
volved. Buycks–Roberson v. Citibank Federal Sav. thorough and vigorous one before the trial. This
Bank, 162 F.R.D. 338, 343 (N.D.Ill.1995); S.E.C. v. would totally defeat the purpose of the discovery
Morelli, 143 F.R.D. 42, 45 (S.D.N.Y.1992). process. The Court understands that preparing for a
Rule 30(b)(6) deposition can be burdensome.
*3 The Rule 30(b)(6) designee does not give his However, this is merely the result of the concomi-
personal opinions. Rather, he presents the corpora- tant obligation from the privilege of being able to
tion's “position” on the topic. U.S. v. Massachusetts use the corporate form in order to conduct business.
Indus. Finance Agency, 162 F.R.D. 410, 412
(D.Mass.1995); Lapenna v. Upjohn Co., 110 F.R.D. United States v. Taylor, 166 F.R.D. 356, 361–62
15, 21 (E.D.Pa.1986); Toys “R” Us, Inc. v. N.B.D. (M.D.N.C.1996), accord Paul Revere Life Ins. Co. v.
Trust Company, No. 88C10349, 1993 WL 543027, Jafari, 206 F.R.D. 126, 127–28 (D.Md.2002).
at *2 (N.D.Ill. Sept.29, 1993). Moreover, the de-
signee must not only testify about facts within the
Neither the parties' research nor my own has
corporation's knowledge, but also its subjective be-
found any authority directly addressing the specific
liefs and opinions. Lapenna, 110 F.R.D. at 20. The
question of whether a corporation receiving a Rule
corporation must provide its interpretation of
30(b)(6) notice is obligated to prepare its witness with
documents and events. Ierardi v. Lorillard, Inc.,
both the entity's own knowledge and the knowledge of
Civ. A. No. 90–7049, 1991 WL 158911 (E.D.Pa.
its subsidiaries and affiliates. However, decisions
Aug.13, 1991). The designee, in essence, represents
dealing with the scope of a producing party's duty to
the corporation just as an individual represents him
respond to interrogatories or document requests pro-
or herself at a deposition. Were it otherwise, a
vide guidance.
corporation would be able to deceitfully select at
trial the most convenient answer presented by a
[2] A corporation responding to interrogatories
number of finger-pointing witnesses at the deposi-
must provide not only the information contained in its
tions. See Lapenna, 110 F.R.D. at 25. Truth would
own files and possessed by its own employees,
suffer.
American Rockwool, Inc. v. Owens–Corning Fiber-
glas Corp., 109 F.R.D. 263, 266 (E.D.N.C.1985), it
... The attorney for the corporation is not at liberty
must also provide all information under its control. “A
to manufacture the corporation's contentions. Ra-
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A
Page 5
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
party served with interrogatories is obliged to respond AFL–CIO, 870 F.2d 1450, 1452 (9th Cir.1989) (“A
by ‘furnish[ing] such information as is available to the corporation must produce documents possessed by a
party.’ [Defendant] therefore is obliged to respond to subsidiary that the parent corporation owns or
the interrogatories not only by providing the infor- wholly controls.”); Alden v. Time Warner, Inc., No.
mation it has, but also the information within its con- 94 Civ. 6109, 1995 WL 679238, at *2 (S.D.N.Y.
trol or otherwise obtainable by it.” In re Auction Nov.14, 1995) (corporate parent required to produce
Houses Antitrust Litig., 196 F.R.D. 444, 445 documents held by its subsidiary); Camden Iron [&
(S.D.N.Y.2000), quoting and citing Fed.R.Civ.P. Metal v. Marubeni Am. Corp.], 138 F.R.D. [438,]
33(a) (emphasis in original); Cullins v. Heckler, 108 441 [ (D.N.J.1991) ] (parent corporation has control
F.R.D. 172, 176–77 (S.D.N.Y.1985); 8A Charles Alan over documents in physical control of whol-
Wright, Arthur R. Miller & Richard L. Marcus, Fed- ly-owned or controlled subsidiary); In re Uranium
eral Practice & Procedure: Civil §§ 2174, 2177 (2d Trust Litigation, 480 F. Supp. 1138, 1152
ed.1994). See also Shamis v. Ambassador Factors (N.D.Ill.1979) (corporate parent must produce
Corp., 34 F. Supp. 2d 879, 894 (S.D.N.Y.1999). Ac- documents of wholly-owned subsidiary but not
cordingly, “when the parent is served with an inter- documents of 43.8%-owned subsidiary which
rogatory, it is no defense to claim that the information conducted its corporate affairs separately); Hubbard
is within the possession of a wholly owned subsidiary, v. Rubbermaid, Inc., 78 F.R.D. 631, 637
because such a corporation is owned and controlled by (D.Md.1978) (parent corporation must produce
such interrogee.” Westinghouse Credit Corp. v. documents held by wholly-owned subsidiaries and
Mountain States Mining & Milling Co., 37 F.R.D. fact that subsidiaries were separate corporate enti-
348, 349 (D.Col.1965). See also Sol S. Turnoff Drug ties was irrelevant). This principle applies where the
Distrib. Inc. v. N.V. Nederlandsche Combinatie Voor subsidiary is not owned directly but, rather, is
Chemische Industrie, 55 F.R.D. 347, 349 owned by an intermediate corporation that is itself a
(E.D.Pa.1972); Erone Corp. v. Skouras Theaters wholly-owned corporation of the parent corpora-
Corp., 22 F.R.D. 494, 498 (S.D.N.Y.1958); Greenbie tion. See Lethbridge v. British Aerospace PLC, No.
v. Noble, 18 F.R.D. 414, 415 (S.D.N.Y.1955); Banana 89 Civ. 1407, 1990 WL 194915, at *1 (S.D.N.Y.
Serv. Co. v. United Fruit Co., 15 F.R.D. 106, 108 Nov. 28, 1990).
(D.Mass.1953).
See also George Hantscho Co. v. Mieh-
*4 The same principle applies to requests for le–Goss–Dexter, Inc., 33 F.R.D. 332, 334–35
documents pursuant to Rule 34 and requires a party to (S.D.N.Y.1963).
produce documents in its “possession, custody or
control ....” Fed.R.Civ.P. 34(a). As observed by the I conclude that the same principle that is applied
Honorable Robert W. Sweet, United States District to interrogatories and document requests should also
Judge, in Dietrich v. Bauer, 95 Civ. 7051(RWS), 2000 be applied to determine the scope of a party's obliga-
WL 1171132 at *3 (S.D.N.Y. Aug. 16, 2000): tion in responding to a Rule 30(b)(6) notice of depo-
sition. There is no logical reason why the sources
Numerous courts have concluded that a parent researched by a party in responding to a discovery
corporation has a sufficient degree of ownership and request should be dependent on the particular discov-
control over a wholly-owned subsidiary that it must ery vehicle used; in all cases, the responding party
be deemed to have control over documents located should be obligated to produce the information under
with that subsidiary. See United States v. Interna- its control. Application of this principle to Rule
tional Union of Petroleum and Indus. Workers, 30(b)(6) discovery is not only consistent with the
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A
Page 6
Not Reported in F.Supp.2d, 2002 WL 1835439 (S.D.N.Y.)
(Cite as: 2002 WL 1835439 (S.D.N.Y.))
judicial interpretations of the other discovery provi- tion. Accordingly, no later than August 19, 2002,
sions of the Federal Rules of Civil Procedure, it is also Tribune Broadcasting is directed to produce a witness
consistent with the purpose of discovery—“[to] make properly prepared with the knowledge of WGN Su-
a trial less a game of blind man's buff and more a fair perstation concerning all documents produced by
contest with the basic issues and facts disclosed to the Tribune Broadcasting.
fullest practicable extent.” United States v. Procter &
Gamble Co., 356 U.S. 677, 682, 78 S. Ct. 983, 2 SO ORDERED
L.Ed.2d 1077 (1958); accord EEOC v. Metropolitan
Museum of Art, 80 F.R.D. 317, 318 (S.D.N.Y.1978).
S.D.N.Y.,2002.
Twentieth Century Fox Film Corp. v. Marvel Enter-
*5 [3] Application of this principle to the present prises, Inc.
case leads to the conclusion that Tribune Broadcasting Not Reported in F.Supp.2d, 2002 WL 1835439
must provide a witness prepared with the knowledge (S.D.N.Y.)
of WGN Superstation to testify concerning the doc-
uments in issue. Tribune Broadcasting's public state-
END OF DOCUMENT
ments establish that it controls WGN Superstation.
Specifically, Tribune Broadcasting's web page states
“Tribune Broadcasting owns and operates 23 ma-
jor-market television stations, including national su-
perstation WGN–TV, and reaches more than 80 per-
cent of U.S. television households.” Tribune Company
Overview, available at http://
www.tribune.com/about/index.htm (last visited Aug.
4, 2002) (emphasis added). Since Tribune Broad-
casting “owns and operates” WGN Superstation, it has
sufficient control to be charged with WGN Super-
station's knowledge for discovery purposes.FN2
FN2. Although Tribune Broadcasting has, in
response to the current motion, attempted to
distance itself both from the statements on its
web site and from WGN Superstation, its
arguments in this regard are entitled to no
weight. There cannot be one “truth” for the
world at large, and a different “truth” for the
Court.
IV. Conclusion
Accordingly, for all the foregoing reasons, I con-
clude that Tribune Broadcasting violated its obliga-
tions under Rule 30(b)(6) by failing to provide a wit-
ness properly prepared to testify concerning the sub-
ject matters designated in plaintiff's notice of deposi-
© 2015 Thomson Reuters. No Claim to Orig. US Gov. Works.
APP. A