Vinmar Overseas Singapore PTE LTD v. PTT International Trading PTE LTD

Affirmed and Opinion filed October 24, 2017.
In The
Fourteenth Court of Appeals
NO. 14-16-00934-CV
VINMAR OVERSEAS SINGAPORE PTE LTD, Appellant
V.
PTT INTERNATIONAL TRADING PTE LTD, Appellee
On Appeal from the 189th District Court
Harris County, Texas
Trial Court Cause No. 2016-21265
OPINION
Appellant Vinmar Overseas Singapore PTE Ltd appeals the trial court’s
interlocutory order granting the special appearance of PTT International Trading
PTE Ltd. Vinmar sued PTT, a business competitor, and Bhuvaraha Krishnan,
Vinmar’s former employee, after Krishnan left Vinmar to work for PTT. Vinmar
asserted claims against PTT for misappropriation of trade secrets and confidential
information, tortious interference with an employment agreement signed by
Krishnan, business disparagement, and conspiracy. We conclude that PTT lacks
sufficient minimum contacts with Texas to permit the exercise of personal
jurisdiction over it by Texas courts, and that PTT did not purposefully avail itself of
the privileges and benefits of conducting activities within the forum. All of the acts
of which Vinmar complains occurred in Singapore or overseas, and the few contacts
to which Vinmar points are insufficient. We thus affirm the trial court’s order
granting PTT’s special appearance and dismissing for want of jurisdiction Vinmar’s
claims against PTT.
BACKGROUND
According to its pleadings, Vinmar trades in chemical commodities, primarily
in Southeast Asia, Far East Asia, India, and the Middle East. It is a corporation
organized under the laws of Singapore, “with its principal place of business in the
United States located in Houston, Texas.” Vinmar’s former employee, Krishnan, is
an Indian national permanently residing and working in Singapore. Vinmar
employed Krishnan in 2010 as Business Head-Chemicals for Southeast Asia. As part
of that employment, Krishnan signed an employment agreement containing non-
solicitation and non-disparagement clauses. Although Krishnan lived and worked in
Singapore, the agreement contained a provision stating, in all capital letters, that the
agreement would be governed by the laws of the State of Texas. In the agreement,
Krishnan expressly consented to the personal jurisdiction of the state and federal
courts located in Texas for claims arising from or relating to the agreement. The
record does not disclose where Vinmar and Krishnan executed the agreement, but it
does establish that Krishnan lived and worked in Singapore.
A few years after signing the employment agreement, Krishnan left Vinmar
and began working for PTT in Singapore. PTT is a Singapore corporation registered
to conduct business, and headquartered in, Singapore. PTT trades in oil and other
2
chemical commodities primarily in Southeast Asia, Far East Asia, India, and the
Middle East. Vinmar alleges that Krishnan breached his agreement with Vinmar by
disclosing to PTT Vinmar’s confidential information, soliciting Vinmar’s
Singaporean and Indian customers, and disparaging Vinmar in the marketplace.
Vinmar brought suit against Krishnan for breach of the employment
agreement, misappropriation of trade secrets and confidential information, business
disparagement, and civil conspiracy. Against PTT, Vinmar asserted claims for
misappropriation of trade secrets and confidential information, business
disparagement, tortious interference with the employment agreement by inducing
Krishnan to violate the agreement, and civil conspiracy.
PTT filed a special appearance that it later amended.1 In the Amended Special
Appearance, PTT asserted that it lacked sufficient contacts with Texas to subject it
to the jurisdiction of Texas courts. Specifically, PTT contended that Vinmar had not
alleged any facts that PTT committed a tort “in whole or in part” in Texas and that,
although Krishnan had done so in the employment agreement, PTT had not
consented to the jurisdiction of Texas courts. PTT attached the declaration of
Vaitayang Kullavanijaya, in which he averred, on behalf of PTT, that PTT is a
Singaporean company, registered to conduct business in Singapore, with its principal
place of business in Singapore. He further stated that PTT has no office in Texas,
has never had an office in Texas, has no registered agent for service of process in
Texas, and does not maintain any bank accounts in Texas, nor own any property in
Texas. Kullavanijaya averred that all of PTT’s business dealings with Vinmar
occurred in Singapore, that all acts concerning employment of Krishnan occurred in
Singapore, and that Vinmar is a Singaporean company with its headquarters located
1
Krishnan has not contested the assertion of personal jurisdiction over the claims asserted
by PTT against him by Texas courts and he is not a party to this appeal.
3
in Singapore. Finally, Kullavanijaya averred that the parties currently were involved
in litigation, based on the same facts at issue in this suit, in Singapore.
In its response in opposition to the special appearance, Vinmar asserted that
Krishnan was a party to the agreement, that he went to work for PTT while still under
the restrictions of the agreement, Krishnan directly contacted Vinmar’s customers
that he previously serviced at Vinmar, that PTT was put on notice of the agreement
and the Texas choice-of-law and forum-selection clause, PTT and Krishnan refused
to cease and desist from contacting Vinmar’s customers and disparaging Vinmar.
Vinmar argued that these allegations were sufficient for the exercise of specific
jurisdiction over PTT on the claims arising from the agreement.
The trial court disagreed and granted PTT’s Amended Special Appearance.
Vinmar now appeals the trial court’s order granting the special appearance and
dismissing Vinmar’s claims against PTT.
ANALYSIS
In a single issue Vinmar contends the trial court erred in granting PTT’s
Amended Special Appearance. In the argument section of its brief, Vinmar describes
the legal issue in the case as follows: “[w]here a nonresident defendant employs a
former employee of the plaintiff who is bound by a contractual agreement not to
solicit the plaintiff’s customers or disparage the plaintiff and where that agreement
contains a Texas forum selection and choice of law provision, is the nonresident
defendant subject to jurisdiction in Texas where that nonresident defendant is put on
notice of the agreement and continued to employ the employee who is violating the
agreement?” Because PTT did not enter into the employment contract with Vinmar,
had no contacts with Texas, and committed no tort in whole or in part in Texas, we
answer Vinmar’s question “no.”
4
I. Standards of review
Whether the trial court may exercise personal jurisdiction over PTT is a
question of law, which we review de novo. See BMC Software Belgium, N.V. v.
Marchand, 83 S.W.3d 789, 794 (Tex. 2002). In deciding the jurisdictional issue, the
trial court frequently must resolve questions of fact. Id. When, as here, the trial court
does not issue findings of fact and conclusions of law, we imply all relevant facts
that are necessary to support the trial court’s judgment and supported by the
evidence. M&F Worldwide Corp. v. Pepsi-Cola Metro. Bottling Co., Inc., 512
S.W.3d 878, 885 (Tex. 2017).
The jurisdictional framework
Our jurisdictional analysis includes both federal and state law precepts. See
Searcy v. Parex Res., Inc., 496 S.W.3d 58, 66 (Tex. 2016). The exercise of personal
jurisdiction over a nonresident defendant must satisfy two requirements. First, the
Texas long-arm statute must grant jurisdiction. Second, the exercise of jurisdiction
must comport with federal and state constitutional guarantees of due process. Id.;
Moring v. Inspectorate Am. Corp., No. 14-16-00898-CV, 2017 WL 3158893, at *3
(Tex. App.—Houston [14th Dist.] July 25, 2017, pet. filed).
Vinmar has asserted tort claims against PTT. The Texas long-arm statute
permits the exercise of jurisdiction over a nonresident who commits a tort “in whole
or in part” in this state. See Tex. Civ. Prac. & Rem. Code Ann. § 17.042(2) (West
2015). The plaintiff and defendant bear shifting burdens of proof in a personal
jurisdiction challenge. See Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 658
(Tex. 2010). The plaintiff must first plead allegations sufficient to confer jurisdiction
under the long-arm statute. See Moncrief Oil Int’l, Inc. v. OAO Gazprom, 414
S.W.3d 142, 149 (Tex. 2013); Kelly, 301 S.W.3d at 658. Once the plaintiff meets
this initial burden, the burden shifts to the nonresident defendant to negate all
5
potential bases for personal jurisdiction. Kelly, 301 S.W.3d at 658; Moring, 2017
WL 3158893, at *3. “If the plaintiff fails to plead facts bringing the defendant within
reach of the long-arm statute (i.e., for a tort claim, that the defendant committed
tortious acts in Texas), the defendant need only prove that it does not live in Texas
to negate jurisdiction.” Kelly, 301 S.W.3d at 658-59.
The exercise of personal jurisdiction comports with federal and state
constitutional guarantees of due process when (1) the defendant has established
minimum contacts with the forum state; and (2) the assertion of jurisdiction does not
offend traditional notions of fair play and substantial justice. See Searcy, 496 S.W.3d
at 66 (citing Int’l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 90 L.
Ed. 95 (1945)).
Minimum contacts and specific jurisdiction
Minimum contacts with a forum may give rise to either general or specific
jurisdiction. Id. at 67. Vinmar does not allege general jurisdiction as a basis for
exercising personal jurisdiction over PTT; thus, we focus our analysis on specific
jurisdiction principles. Specific jurisdiction exists if the claims in question arise
from or relate to the defendant’s purposeful contacts with Texas. See Moki Mac
River Expeditions v. Drugg, 221 S.W.3d 569, 576 (Tex. 2007). When specific
jurisdiction is at issue, we must determine whether there is a substantial connection
between the alleged forum contacts and the “operative facts” of the litigation. See
id. at 585; see also Moncrief, 414 S.W.3d at 150. We analyze the jurisdictional
contacts for a substantial connection with the operative facts of the case on a claim-
by-claim basis, unless all of the claims arise from the same forum contacts. See
Moncrief, 414 S.W.3d at 150-51; Ren v. ANU Res., LLC, 502 S.W.3d 840, 849 (Tex.
App.—Houston [14th Dist.] 2016, no pet.).
Under the specific jurisdiction rubric, the nonresident defendant must have
6
purposefully availed itself of the privilege of conducting activities within the forum.
See M&F Worldwide corp., 512 S.W.3d at 890 (“In sum, specific personal
jurisdiction over a nonresident defendant requires the defendant’s purposeful
availment of the privilege of conducting activities within the forum state, thus
invoking the benefits and protections of its laws.”). The “purposeful availment”
inquiry has three features: (1) the relevant contacts are those of the defendant, and
the unilateral activity of another person or a third party are not relevant; (2) the
contacts that establish purposeful availment must be purposeful, rather than random,
fortuitous, isolated, or attenuated; and (3) the defendant must seek some benefit,
advantage, or profit by “availing” itself of the jurisdiction. See id. at 886.
Both the Supreme Court of the United States and the Supreme Court of Texas
make clear that it is the defendant’s, rather than the plaintiff’s, contacts with the
forum that are dispositive. See Walden v. Fiore, ___ U.S. ___, 134 S. Ct. 1115, 1122,
188 L. Ed. 2d 12 (2014) (“[t]he plaintiff cannot be the only link between the
defendant and the forum. Rather, it is the defendant’s conduct that must form the
necessary connection with the forum State that is the basis for its jurisdiction over
him.”); Searcy, 496 S.W.3d at 67-68 (“the mere fact that [a defendant’s] conduct
affected plaintiffs with connections to the forum [s]tate does not suffice to authorize
jurisdiction.”) (quoting Walden, 134 S. Ct. at 1126). Even where the defendant
knows the brunt of the injury will be felt by a particular resident of the forum state,
mere knowledge alone is insufficient to establish purposeful availment. See
Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777, 788 (Tex. 2005).
If we determine PTT had sufficient minimum contacts with Texas and the
contacts are substantially connected to the claims asserted by Vinmar, we then
determine whether the exercise of jurisdiction would offend traditional notions of
fair play and substantial justice. See Fjell Tech. Grp. v. Unitech Int’l, Inc., No. 14-
7
14-00255-CV, 2015 WL 457805, at *9 (Tex. App.—Houston [14th Dist.] 2015, pet.
denied) (mem. op.). In most cases, where a defendant has minimum contacts with a
forum state, the exercise of jurisdiction will not conflict with notions of fair play and
substantial justice. See Moncrief Oil, 414 S.W.3d at 154-55; RSM Prod. Corp. v.
Global Petroleum Grp., Ltd., 507 S.W.3d 383, 392 (Tex. App.—Houston [1st Dist.]
2016, pet. denied).
II. The jurisdictional allegations and evidence
In reviewing whether a plaintiff has met its initial burden of alleging
jurisdictional facts sufficient to bring a nonresident defendant within the terms of the
Texas long-arm statute, we consider the plaintiff’s pleadings and its response to the
defendant’s special appearance. See Perna v. Hogan, 162 S.W.3d 648, 653 (Tex.
App.—Houston [14th Dist.] 2005, no pet.). In its live pleadings and response to the
special appearance, Vinmar has asserted the following jurisdictional facts:
 Krishnan agreed to an employment contract that contained a consent to
Texas jurisdiction, Texas forum selection, and Texas choice of law.
 Vinmar put PTT on notice of the employment contract between
Krishnan and Vinmar with the Texas choice of forum and choice of law
provisions but PTT nevertheless participated in misappropriation and
other tortious conduct arising from the employment contract.
 The logistical operations underlying certain of the transactions that
Defendants interfered [sic] took place in Houston, Texas.
 A tort was committed in Texas.
 PTT and Krishnan upset Vinmar’s relationship with Visen, an Indian
company.
 PTT encouraged and induced Krishnan to breach the employment
contract.
 Krishnan and PTT disparaged Vinmar in the marketplace by making
false statements of fact of and concerning Vinmar to numerous current
and prospective customers of Vinmar.
8
 PTT and Krishnan misappropriated Vinmar’s trade secrets and
confidential information, such as customer information, for their own
benefit.
 PTT willfully and intentionally interfered with the employment
agreement between Vinmar and Krishnan by inducing Krishnan to
breach his employment agreement for the benefit of PTT.
 PTT and Krishnan conspired to commit the torts of misappropriation of
trade secrets and confidential information and business disparagement.
 PTT is bound by the consent to jurisdiction of Texas courts contained
in the employment agreement between Vinmar and Krishnan because
Vinmar’s tort claims arise from that contractual relationship and PTT
is a “transaction participant.”
 PTT is bound to the consent to jurisdiction of Texas courts contained
in the employment agreement between Vinmar and Krishnan because
PTT is “closely related” to Krishnan.
In its response to the amended special appearance, Vinmar submitted the
declaration of Devang Mehta, a Senior Vice-President of a Vinmar affiliate and the
supervisor of Krishnan while Krishnan worked at Vinmar. Mehta averred that:
 A Vinmar employee named Verma sent an email to Krishnan and PTT
in which he informed Krishnan and PTT that Krishnan clearly breached
the confidentiality requirement of the employment agreement.
 Mehta advised a PTT representative in a telephone call and follow up
email that Krishnan was “bound by the Confidentiality Agreement not
to solicit Vinmar’s customers and not to disparage Vinmar.”
 Mehta informed the PTT representative in that telephone conversation
that he [Mehta] was based in Houston, Texas.
 PTT and Krishnan disrupted Vinmar’s relationships with TPX (a Thai
Oil Company), Haldia Petrochemicals (an Indian company), Indian Oil
Corporation, Ltd. (an Indian company), and ONGC Mangalore
Petrochemicals Ltd. (an Indian Company).
A. Vinmar did not plead a tort committed in whole or in part in Texas.
Vinmar does not allege in any of its live pleadings or its response to the
Amended Special Appearance the location for any of the alleged acts by PTT or
9
Krishnan. Vinmar alleged that Krishnan and PTT misappropriated its trade secrets
and confidential information, but it does not allege that the misappropriation
occurred in whole or in part in Texas. Likewise, Vinmar does not allege facts
showing where the alleged tortious interference with the employment agreement
occurred, where the alleged business disparagement occurred, or where the alleged
conspiracy occurred. Vinmar did not allege that Krishnan and PTT interfered with,
or disparaged it to, any Texas customers or companies. Vinmar states that the alleged
business disparagement happened in the marketplace, but it does not define the
marketplace. Personal jurisdiction is grounded on the defendant’s actions and
choices to enter the forum state and conduct business. See Kelly, 301 S.W.3d at 660.
When the plaintiff fails to allege an act by the defendant occurring in Texas, the
plaintiff has not met its initial burden of pleading acts sufficient to invoke
jurisdiction over the nonresident defendant. Id. at 660-61; see also Moncrief, 414
S.W.3d at 153, 157 (nonresident defendant subject to jurisdiction for
misappropriation of trade-secrets claim where defendant obtained the trade secrets
in Texas, but not for tortious interference claim where alleged acts of interference
occurred outside of Texas).
PTT submitted evidence affirmatively stating that (1) PTT is not a Texas
corporation, nor does it have any offices or places of business in Texas; (2) it did not
misappropriate any of Vinmar’s confidential information and trade secrets in Texas;
(3) it did not make any false statements of fact concerning Vinmar to any current or
prospective customers in Texas; (4) PTT’s discussions with Krishnan and
employment of Krishnan took place solely in Singapore; and (5) all acts concerning
PTT’s employment of Krishnan and PTT’s business dealings with Vinmar occurred
in Singapore. The record contains no evidence to the contrary. We conclude that this
evidence is sufficient to negate jurisdiction on the basis of a direct tort committed in
10
whole or in part in Texas. See Kelly, 301 S.W.3d at 661.
B. The Krishnan-Vinmar employment agreement does not support
jurisdiction.
Vinmar argues that it did plead sufficient facts for the court to exercise
specific jurisdiction based on two theories. First, Vinmar argues that, under the
“effects test,” PTT is subject to specific jurisdiction because it knew Krishnan had
an employment agreement that contained a Texas forum-selection and choice-of-law
clause. Second, Vinmar argues it can enforce the forum-selection clause contained
in Krishnan’s contract with Vinmar against PTT based on a “closely-related party”
theory. We address each theory in turn.
1. The “effects test” does not apply.
The “effects test” finds its genesis in the United States Supreme Court
decision of Calder v. Jones, 465 U.S. 783, 104 S. Ct. 1482, 79 L. Ed. 2d 804 (1984).
In Calder, two nonresident defendants published allegedly libelous magazine
articles about the plaintiff and disseminated the articles in the plaintiff’s home state
of California. See id. at 785-86. The Court addressed whether a nonresident
defendant is subject to jurisdiction in a forum where the defendant, while outside the
state, directs a tort toward a plaintiff in the state and the plaintiff feels the “brunt of
the injury” in the state. Id. at 789-90. Because the defendants in that case expressly
and intentionally aimed allegedly tortious acts at California, and considering the
“effects” of the defendants’ out-of-state conduct would be felt in California, the
Court found the out-of-state defendants were subject to jurisdiction because they
reasonably could anticipate being haled into a California court. Id.
In Walden v. Fiore, the Court revisited the Calder opinion and explained that,
due to the nature of the libel tort and the fact that the injury occurs through the
dissemination of false statements about the plaintiff, “the defendants’ intentional tort
11
actually occurred in California.” 134 S. Ct. at 1124. The Court took pains to narrow
the application of the Calder “effects test” and reiterated that in all cases “a forum
State’s exercise of jurisdiction over an out-of-state intentional tortfeasor must be
based on intentional conduct by the defendant that creates the necessary contacts
with the forum.” Id. at 1123 (emphasis added). The mere fact that the plaintiff resides
in the forum and feels the effects of the tort in the forum is insufficient. Id. at 1125.
In Walden, as in this case, all of the allegedly tortious conduct occurred outside of
the forum state. Id. The Court emphasized that jurisdiction will not lie where the
only link between the defendant and the forum is the plaintiff’s residence in the
forum state, even when the defendant knows the plaintiff will feel the effects of the
tort in the forum. See id.
Texas courts are in accord. In Searcy, the Supreme Court of Texas noted that
Texas courts had interpreted Calder the same way the Court did in Walden. See
Searcy, 496 S.W.3d at 68-69 (citing Michiana Easy Livin’ Country, Inc.). Thus,
“[e]ven if a nonresident defendant knows that the effects of its actions will be felt by
a resident plaintiff, that knowledge alone is insufficient to confer personal
jurisdiction over the nonresident.” Id. at 69 (emphasis in original). To hold otherwise
would allow jurisdiction over the nonresident defendant on the basis of the unilateral
activity of the plaintiff, rather than on purposeful contacts with the forum by the
defendant.2 See id.at 70.
2
For this same reason, Vinmar’s reference on appeal to its own contacts with Texas is
unpersuasive. Vinmar cites the fact that it had logistical operations in Houston, and its
representative Mehta informed PTT that he [Mehta] was based in Houston. The fact that Vinmar
had logistical operations in Texas and a representative informed PTT in a telephone call that the
representative was based in Houston are the type of random or fortuitous contacts the court rejected
in Searcy as insufficient to confer jurisdiction. See Searcy, 496 S.W.3d at 73. And, given that none
of the claims asserted against PTT arise out of the logistical operations in Houston, the lack of a
substantial connection between the logistical operations in Houston and the operative facts of the
litigation precludes jurisdiction on that basis. See Moki Mac, 221 S.W.3d at 585.
12
In support of its argument that the “effects test” allows Texas courts to assert
jurisdiction in this case, Vinmar relies on two federal court cases that pre-date the
Walden decision: Astro-Med, Inc. v. Nihon Hoden Am., Inc., 591 F.3d 1 (1st Cir.
2009) and Medicus Radiology, LLC v. Nortek Med. Staffing, Inc., No. 10-CV-300-
PB, 2011 WL 9373, at *5 (D. N.H. Jan. 3, 2011). We find both cases inapplicable.
In Astro-Med, Inc. v. Nihon Hoden Am., Inc., the plaintiff was a Rhode Island
corporation with its principal place of business in Rhode Island. 591 F.3d at 6. The
plaintiff sued the defendant in Rhode Island for tortious interference with its
contractual relationship with a Florida-based sales employee. Id. at 7, 9. The
defendant, a California corporation, asserted lack of personal jurisdiction because
all of its direct dealings with the employee took place outside the forum. Id. at 10.
Relying on Calder, the First Circuit Court of Appeals held that the defendant was
subject to jurisdiction in Rhode Island because “a defendant need not be physically
present in the forum state to cause injury (and thus activity) for jurisdictional
purposes in the forum state.” Id. (internal citations omitted). Of importance to the
Astro-Med court was the fact that the defendant’s conduct outside the forum caused
the breach of contract that occurred in Rhode Island. Thus, the in-forum injury was
clearly related to the tortious interference claim. Id. The court relied heavily on the
fact that the defendant knew of the employment agreement and that it contained a
Rhode Island choice-of-law provision before the defendant hired the employee. See
id.
In Medicus Radiology, the federal district court in New Hampshire, held that
the relatedness element discussed in Astro-Med was satisfied because the plaintiff, a
forum resident, felt the effects of its injury in the forum state. 2011 WL 9373, at *4.
Underpinning both Astro-Med and Medicus Radiology was the fact that the plaintiff
had actually suffered effects of the defendant’s out-of-state conduct in the forum and
13
thus jurisdiction existed under the “effects test” in Calder. See Astro-Med., 591 F.3d
at 10; Medicus Radiology, 2011 WL 9373, at *4 (relying on Astro-Med). Texas law,
however, requires more than mere knowledge that a plaintiff suffered the effects of
its injury in the forum—there must be conduct by the nonresident defendant aimed
at the forum. See Searcy, 496 S.W.3d at 69; TV Azteca v. Ruiz, 490 S.W.3d 29, 43
(Tex. 2016) (noting there is a “subtle yet crucial difference between directing a tort
at an individual who happens to live in a particular state and directing a tort at that
state”).
Where, as here, it is undisputed that no part of a nonresident defendant’s
course of conduct occurred in or was aimed at the forum state, the nonresident does
not form jurisdictionally relevant contacts with the forum. See Walden, 134 S. Ct. at
1124 (“In short, when viewed through the proper lens—whether the defendant’s
actions connect him to the forum—petitioner formed no jurisdictionally relevant
contacts with Nevada”). Vinmar has not alleged that any of the alleged tortious acts
by PTT occurred in Texas. PTT has not targeted Texas, nor taken any acts to
purposefully avail itself of the privileges and benefits of conducting activities within
Texas. PTT has formed no jurisdictionally relevant contacts with Texas. To hold
otherwise would shift the analytical focus from assessing the defendant’s contacts
with the forum to assessing the defendant’s contacts with the plaintiff. See id.
Vinmar argues: “PTT is subject to Texas jurisdiction because it intentionally
and knowingly employed Krishnan after being put on notice that Krishnan was
subject to the Agreement and that Texas law governed the Agreement and that PTT
and Krishnan were violating that Agreement. PTT profited from Krishnan’s
violation of the Agreement and assisted him in doing so, thereby purposefully
availing itself of Texas’ jurisdiction.” We disagree. First, the evidence is undisputed
that PTT did not know of the existence of the agreement or the application of Texas
14
law at the time PTT hired Krishnan. PTT did not seek out an employee that it knew
was subject to an agreement governed by Texas law.3
Second, we do not agree that these circumstances show PTT purposefully
availed itself of the privileges and benefits of conducting activities within Texas, as
is required to assert personal jurisdiction. All of PTT’s conduct occurred outside of
Texas. PTT’s mere knowledge of the existence of the employment agreement alone
is not sufficient to establish minimum contacts with Texas for the same reason that
mere knowledge that the effects of any injury will be felt by a resident plaintiff is
insufficient. Such an analysis impermissibly puts the focus on the plaintiff’s contacts
with Texas, not on PTT’s purposeful contacts with Texas. See Walden, 134 S. Ct. at
1122 (“. . . the relationship must arise out of contacts that the ‘defendant himself’
creates with the forum State”); Searcy, 496 S.W.3d at 68-69 (knowledge of effects
in forum alone is insufficient to confer personal jurisdiction over the nonresident
defendant); see also M&F Worldwide Corp., 512 S.W.3d at 889 (mere knowledge
that Texas resident would manage Delaware company in Texas insufficient to
constitute purposeful availment of Texas law); TV Azteca, 490 S.W.3d at 46-47
(mere knowledge that a broadcaster’s programs will be received in another
jurisdiction is insufficient; there must be additional conduct showing an intent to
serve the forum state market).
Vinmar argues that PTT targeted Texas because it interfered with a “Texas
contract” applying Texas law. While the inclusion of a Texas choice-of-law
provision can be a relevant jurisdictional contact, PTT did not choose Texas law.
3
PTT disputes whether it ever knew that Texas law governed the agreement. According to
PTT, the evidence presented by Vinmar shows only that Vinmar informed PTT that Krishnan was
breaching his employment agreement—the evidence does not show that Vinmar mentioned Texas
law or that Vinmar provided PTT with a copy of the employment agreement. To the extent the
evidence on this point is disputed, we imply all findings of fact in support of the trial court’s
judgment. See M&F Worldwide Corp., 512 S.W.3d at 885.
15
PTT did not sign the agreement with Vinmar—Krishnan signed the agreement
choosing Texas law. Cf. RSM Prod. Corp., 507 S.w.3d at 394 (actions of co-
defendants did not support jurisdiction over non-resident defendant). And, it is not
clear from the record that the employment agreement signed by Krishnan is in fact
a “Texas contract.” The contract does not state where it is to be performed. Nor does
the record disclose where the contract was executed. These factors are important.
See Zac Smith & Co. v. Otis Elevator Co., 734 S.W.2d 662, 665-66 (Tex. 1987)
(execution of contract that was wholly performable in Texas and would provide
profit from hotel to be built in Texas supported jurisdiction); Nogle & Black
Aviation, Inc. v. Faveretto, 290 S.W.3d 277, 283 (Tex. App.—Houston [14th Dist.]
2009, no pet.) (noting place of performance is an important factor); cf. Tex. Civ.
Prac. & Rem. Code Ann. § 17.041(1) (West 2015) (stating a defendant does business
in Texas where it contracts with a Texas resident and the contract will be performed
in whole or in part in Texas). The trial court, however, could have inferred from the
evidence that the contract was to be performed and was executed overseas as that is
where Krishnan lived and worked. Thus, the Texas choice-of-law and forum-
selection provisions in the agreement do not support jurisdiction over non-signatory
PTT.
Had there been some evidence that PTT intentionally targeted Texas, sought
Texas assets, or sought Texas customers, our analysis might be different. See, e.g.,
Cornerstone Healthcare Grp. Holding, Inc. v. Nautic Mgmt. VI, L.P., 493 S.W.3d
65, 73 (Tex. 2016) (defendant who targeted Texas assets and sought Texas seller
was subject to jurisdiction); TV Azteca, 490 S.W.3d at 51-52 (defendant took
“additional activity” in Texas by taking advantage of the fact that signals reached
into Texas and to financially benefit from that fact). But, there is no evidence
showing PTT intentionally targeted or intended to establish a contact with Texas.
16
PTT did not target any prospective or existing Texas customers of Vinmar. It did not
target any Texas assets of Vinmar. Instead, it allegedly targeted an Indian employee
of Vinmar located in Singapore, and allegedly sought Vinmar’s trade secret and
confidential information and customers in Singapore, Thailand, and India.4
There is no evidence that PTT sought some benefit, advantage, or profit by
availing itself of the privileges and benefits of doing business in Texas. It did no
business in Texas, committed no tort in Texas, nor allegedly caused any injury to
Vinmar in Texas. Accordingly, the trial court lacks specific jurisdiction over PTT.
See M&F Worldwide Corp., 512 S.W.3d at 890.
2. The “closely-related party” theory is inapposite.
Vinmar also contends that Texas courts should exercise jurisdiction over PTT
under the “closely-related party” theory because PTT was closely-related to
Krishnan and the dispute.5 We disagree.
Vinmar cites a federal district court case from Minnesota, Medtronic, Inc. v.
Endologix, Inc., 530 F. Supp. 2d 1054 (D. Minn. 2008), in support of its argument.
In Endologix, the plaintiff company sued two of its former employees and their new
employer for breach of an employment agreement and tortious interference with the
employment agreement. Id. at 1055. The employment agreement contained a forum-
selection clause requiring claims to be litigated in the state courts of Minnesota. Id.
at 1056. The new employer removed the case to federal court and the plaintiff then
filed a motion to remand back to state court. Id. The district court held that the new
4
By this legal analysis, we do not suggest that PTT actually committed these acts because
courts do not rule on the merits of the claims at the special-appearance stage. See Michiana Easy
Livin’ Country, Inc., 168 S.W.3d at 790-91.
5
In the trial court Vinmar also asserted jurisdiction based on the “transaction participant”
theory, but Vinmar does not raise that ground on appeal. We thus do not address the “transaction
participant” theory as grounds for jurisdiction.
17
employer was bound by the forum-selection clause as a closely-related party to the
dispute. Id. The court noted that the new employer was fully aware of the
employment agreements and forum-selection clauses when it hired the employees.
Id. at 1056-57. The Endologix court did not address whether this theory could be
used to assert personal jurisdiction over the new employer because personal
jurisdiction was not at issue. See id. We find this non-binding authority
unpersuasive.
More recently, the federal district court in Minnesota addressed the closely-
related party theory and stated that it largely has been used “to enforce forum
selection clauses against parties who are bound by a clearly common interest, such
as a corporation and its subsidiary and spouses.” Medtronic, Inc. v. Ernst, 182
F. Supp. 3d 925, 932 (D. Minn. 2016). The Minnesota court further noted that the
theory mostly applies where the non-contracting party voluntarily has associated or
joined itself with the contracting party in some type of legal process, such as when
the non-contracting party joins the plaintiff in filing legal proceedings in a certain
forum. See id. at 933. The case involved facts similar to the instant case—a former
employer sued an employee and its new employer alleging breach of the
employment agreement and tortious interference with the agreement by the new
employer. Id. at 931. The court refused to apply the closely-related party theory to
bind the new employer to the forum-selection clause. Id. at 933. The court rejected
an argument like the one Vinmar makes here that the new employer should be bound
because it continued to employ the employee while aware of the non-compete and
forum-selection clauses contained in the employment agreement. Id. The court relied
on the fact that the new employer did not voluntarily join any litigation with the
signatory. Id. Likewise, PTT is not a corporation, subsidiary, or spouse of Krishnan,
and it did not voluntarily join Krishnan in litigation over the employment agreement.
18
It is unclear whether Texas courts have applied this theory, and we decline to in this
case as we find the theory does not support the exercise of personal jurisdiction over
PTT. See Ernst, 182 F. Supp. 3d at 933.
The other cases cited by Vinmar in support of the closely-related party theory
do not address the theory in the context of personal jurisdiction and do not assess
whether due-process is satisfied. See Marano Enters. of Kan. v. Z-Teca Rests., L.P.,
254 F.3d 753, 757 (8th Cir. 2001) (addressing motion to dismiss based on forum
selection clause in agreement—not challenge to personal jurisdiction); Mannetti-
Farrow, Inc. v. Gucci Am., Inc., 858 F.2d 509, 510 (9th Cir. 1988) (same). Vinmar
has cited no Texas cases applying the closely-related party theory to allow the
exercise of personal jurisdiction over a nonresident defendant. Though contract or
agency theories may be used by non-signatories to enforce forum-selection clauses
in contracts, see, e.g., In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 739 (Tex.
2005) (noting six theories arising out of common principles of contract and agency
law), such theories should not be used to bypass the constitutional due-process
analysis required in personal jurisdiction cases. See PHC-Minden, L.P. v. Kimberly-
Clark Corp., 235 S.W.3d 163, 174 (Tex. 2007) (personal jurisdiction “involves due
process considerations that may not be overridden by statutes or the common law”).6
6
We note that in Carlile Bancshares, Inc. v. Armstrong, the Fort Worth Court of Appeals
analyzed whether direct-benefits estoppel and transaction-participant theories could be used to
bind non-signatories and thereby gain personal jurisdiction over the non-signatories. Nos. 02-14-
00014-CV, 02-14-00018-CV, 2014 WL 3891658, at **7-10 (Tex. App.—Fort Worth 2014, Aug.
7, 2014, no pet.). The court held that the presence of a valid and enforceable forum-selection clause
circumvents the need to engage in a due process and minimum contacts analysis. Id. at *5. The
cases cited by the Carlile court in support of this statement, however, involved contractual consent
to jurisdiction—not assertion of personal jurisdiction over a non-contracting party on the basis of
a consent-to-jurisdiction clause signed by another party. See id. (citing Carnival Cruise Lines, Inc.
v. Shute, 499 U.S. 585, 589, 111 S. Ct. 1522, 113 L. Ed. 2d 622 (1991); Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 472 n.14, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985); Baker Hughes Inc.
v. Brooks, 405 S.W.3d 246, 249 (Tex. App.—Houston [14th Dist.] 2013, pet. denied); RSR Corp.
v. Siegmund, 309 S.W.3d 686, 704 (Tex. App.—Dallas 2010, no pet.). We thus find those cases
19
Courts make clear that the assertion of personal jurisdiction over a nonresident
defendant requires an assessment of each defendant’s contacts individually, unless
the corporate veil has been pierced. See Keeton v. Hustler Magazine, Inc., 465 U.S.
770, 781 n.13, 104 S. Ct. 1473, 79 L. Ed. 2d 790 (1984); Cornerstone Healthcare
Grp., 493 S.W.3d at 71 (acknowledging settled law that “contacts of distinct legal
entities, including parents and subsidiaries, must be assessed separately for
jurisdictional purposes unless the corporate veil is pierced”); see also Ahrens &
DeAngeli P.L.L.C v. Flinn, 318 S.W.3d 474, 486 (Tex. App.—Dallas 2010, pet.
denied) (rejecting use of defendants’ participation in alleged scheme to satisfy
jurisdictional analysis because “jurisdiction must be based on whether a defendant
itself purposefully established minimum contacts that satisfy due process.”). PTT’s
contacts must be assessed separately from those of Krishnan or Vinmar, and the
exercise of jurisdiction, if any, must be based on PTT’s own conduct. We decline to
find jurisdiction over PTT based on a closely-related party theory.
CONCLUSION
The touchstone of jurisdictional due process is purposeful availment of the
forum by the defendant. Michiana Easy Livin’ Country, Inc., 168 S.W.3d at 784
(citing Hanson v. Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 2 L. Ed. 2d 1283
(1958)). “[I]t is essential in each case that there be some act by which the defendant
purposefully avails itself of the privilege of conducting activities within the forum
State, thus invoking the benefits and protections of its laws.” Hanson, 357 U.S. at
253. There is simply no allegation or evidence showing that PTT purposefully
availed itself of the privilege of conducting activities in Texas. The trial court
correctly determined that Texas courts cannot exercise personal jurisdiction over
inapposite.
20
PTT. We overrule Vinmar’s issue on appeal and affirm the order granting PTT’s
Amended Special Appearance.
/s/ John Donovan
Justice
Panel consists of Chief Justice Frost and Justices Donovan and Wise.
21