REVERSE, RENDER, AND REMAND a nd Opinion Filed July 30, 2021 

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In The 

### Court of Appeals Fifth District of Texas at Dallas No. 05-20-00558-CV FOREVER LIVING PRODUCTS IN TERNATIONAL, LLC, A NEVADA LIMITED LIABILITY COMPANY, AND ALOE VERA OF AMERICA, INC., A TEXAS CORPO RATION, Appellants V. AV EUROPE GMBH, A GERMAN LI MITED LIABILITY COMPANY, Appellee On Appeal from the 191st Judicial District Court Dallas County, Texas Trial Court Cause No. DC-19-00270
OPINION Before Justices Myers, Partida-Kipness, and Garcia Opinion by Justice Garcia Appellants sued appellee AV Europe GmbH and two othe r defendants. The trial court sustained AV Europe’s special appearance and dismissed the claims against it for lack of personal jurisdicti on. Appellants appeal this interlocutory ruling. We reverse, concluding that AV Eu rope failed to show it is not subject to general jurisdiction in Texas.–2– I. Background A. Factual Allegations Unless otherwise noted, we draw these al legations from appellants’ original petition, which was their live pleading when the trial court granted AV Europe’s special appearance. Appellant Forever Living Products Inte rnational, LLC is the management company for a marketing busine ss (referred to as a whole as “FLP”) that sells aloe vera products in many countries around the wo rld. Appellant Aloe Vera of America, Inc. (AVA) is FLP’s aloe re fining and production entity. Christopher Hardy was an AVA vice pr esident and general manager. He was terminated in 2013. After that, Hardy and other former FLP em ployees created an aloe vera business called AloeVeritas. HW&B Enterp rises, LLC is the holding company and manufacturer for other Al oeVeritas entities including AV Europe. Hardy testified in deposition that AV Europe has always been wholly owned by HW&B and that he is the manager of HW&B. Appellants allege that Hardy attemp ted to poach one of FLP’s foreign distribution entities, FLP Japan, for Aloe Veritas. He did so by disclosing FLP’s confidential information and “by sharing false/misleading ‘insider’ information” with FLP Japan. This caused a dispute be tween FLP and one of FLP Japan’s owners that in turn caused substa ntial damage to FLP.–3– FLP then sued Hardy in an arbitr ation proceeding pursuant to his FLP employment agreement. FLP won a final arb itration award against Hardy for roughly $920,000. The award wa s confirmed as a judgment in Arizona, and that judgment has been domesticated in Texas. B. Procedural History Appellants filed this lawsuit against HW&B, Aloe Veritas Americas, LLC, and AV Europe, alleging that they (throug h Hardy) tortiously interfered with appellants’ relationship with FLP Japan. Appellants seek to hold defendants liable for the same damages that have already been assessed against Hardy. They also seek exemplary damages and injunctive relief. AV Europe filed a special appearance challenging personal jurisdiction, asserting that it is a German entity with no office or facility out side of Germany. Appellants assert, and AV Eur ope does not dispute, that the abbreviation “GmbH” signifies that AV Europe is the German e quivalent of a limited liability company. We accept that assertion fo r purposes of this appeal. See T EX

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. P. 38.1(g) (“In a civil case, the court will accept as true the facts stated [in appellant’s brief] unless another party contradicts them.”); see also Moore ex rel. Moore v. Elektro-Mobil Technik GmbH , 874 S.W.2d 324, 326 n.1 (Tex. Ap p.—El Paso 1994, writ denied) (“In Germany, GmbH designates a clos ely held, limited liability company.”). Appellants filed a response to AV Europe ’s special appearance and attached evidence thereto. AV Europe filed an amended special appearance and additional–4– supporting evidence. AV Europe contende d both that it lacked minimum contacts with Texas and that forcing it to litigate in Texas would offend tr aditional notions of fair play and substantial justice. After a non-evidentiary hearing, the tria l judge sustained AV Europe’s special appearance and dismissed appe llants’ claims against it. Appellants timely filed this interlocutory appeal. See T EX

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. C ODE A NN . § 51.014(a)(7).
II. Issues Presented Appellants raise two issues on appeal: (1) the trial judge erred by sustaining AV Europe’s special appearance and (2) th e trial judge erred by denying appellants’ request for leave to amend their petition to add an allegation of jurisdictional alter
ego. III. Standard of Review and Burden of Proof We review a ruling on a sp ecial appearance de novo. See Kelly v. Gen. Interior Constr., Inc. , 301 S.W.3d 653, 657 (Tex. 2010). If the trial judge does not issue findings of fact and conclusions of law, the fact findings necessary to support the ruling and supported by the evidence are implied. Id . Implied findings are not conclusive and may be ch allenged on appeal for lega l and factual sufficiency. Lensing v. Card , 417 S.W.3d 152, 155 (Tex. A pp.—Dallas 2013, no pet.). The plaintiff bears the initial burden of pleading sufficient facts to bring a nonresident defendant within the reac h of the Texas long-arm statute. Kelly , 301–5– S.W.3d at 658. If the plaintiff pleads suffici ent jurisdictional facts, the defendant bears the burden to negate all alle ged bases of pers onal jurisdiction. Id

. Alternatively, the defendant can prevail by showing that even if the plaintiff’s allegations are true, the evidence is legall y insufficient to establish that personal jurisdiction over the defendant is proper. See id . at 659. Although the trial judge acts as the fa ctfinder and must resolve any factual disputes in the special-appear ance evidence, the judge must accept as true any clear, direct, and positive evidence presen ted in an undisputed affidavit. N. Frac Proppants, II, LLC v. 2011 NF Holdings, LLC , No. 05-16-00319-CV, 2017 WL 3275896, at *6 (Tex. App.—Dallas July 27, 2017, no pet.) (mem. op.); see also Smith v. Patrick W.Y. Tam Trust , 296 S.W.3d 545, 547 (Tex. 2009) (discussing circumstances under which evidence must be taken as true as a matter of law). IV. Analysis A. The Law of Pers onal Jurisdiction Texas courts have persona l jurisdiction over a nonr esident defendant when (1) the Texas long-arm statute authorizes it and (2) the exercise of jurisdiction is consistent with due-process guarantees. Spir Star AG v. Kimich , 310 S.W.3d 868, 872 (Tex. 2010). Texas’s long-arm statute reaches as far as due process allows, id ., so we focus solely on the due-process analysis. The Fourteenth Amendment’s Due Pro cess Clause limits a state court’s authority to proceed against a nonresident defendant. See Goodyear Dunlop Tires–6– Operations, S.A. v. Brown , 564 U.S. 915, 923 (2011). The exercise of personal jurisdiction over a nonresident defendant is constitutional only if (1) the defendant has established minimum contacts with th e forum state and (2) the exercise of jurisdiction comports with traditional notions of fair play and substantial justice. Spir
Star AG , 310 S.W.3d at 872. But see Daimler AG v. Bauman , 571 U.S. 117, 139 n.20 (2014) (second element is superfluous in some personal-jurisdiction cases). The stringency of the minimum-contacts test varies depending on whether the plaintiff’s claims arise out of or rela te to the defendant’s forum contacts. See Ford Motor Co. v. Mont. Eight h Judicial Dist. Court , 141 S. Ct. 1017, 1024–25 (2021). If the plaintiff’s claims are unrelated to the defendant’s forum contacts, the forum is said to be asserting general or all-purpose jurisdiction over the defendant. Goodyear Dunlop , 564 U.S. at 919. A court may asse rt general jurisdiction over a foreign corporation only if its affiliations with the state are so continuous and systematic as to render the corporation essentially at home in the forum state. Id

. Limited liability companies like AV Europe ar e treated like corpor ations for generaljurisdiction purposes. See Careington Int’l Corp. v. First Call Telemedicine, LLC , No. 05-20-00841-CV, 2021 WL 1731753, at *5 (Tex. App.—Dallas May 3, 2021, no pet.) (mem. op.).
In Daimler , the Supreme Court said that there are two paradigmatic bases for general jurisdiction over a corporation: its state of incorporation and the state of its principal place of business. Daimler AG , 571 U.S. at 137. The Daimler Court did–7– not define the term “principal place of business,” but only a few years before Daimler the Court held that the phrase “princip al place of business” means the place where a corporation’s officer s direct, control, and coor dinate the corporation’s activities. See Hertz Corp. v. Friend , 559 U.S. 77, 92–93 (2010) (construing the federal diversity-jurisdiction statute). Courts often refer to this as the company’s “nerve center,” and in practice it should normally be the place of the company’s headquarters—if that is the company’s act ual center of direction, control, and coordination. Hertz Corp ., 559 U.S. at 93. Although Hertzwas not a personaljurisdiction case, courts have applied its de finition of “principal place of business” in personal-jurisdiction cases. E.g. , Ascentium Capital LLC v. Hi-Tech the Sch. of Cosmetology Corp. , 558 S.W.3d 824, 829 (Tex. App. —Houston [14th Dist.] 2018, no pet.); see also Flynn v. Hovensa, LLC , No. 3:14-43, 2014 WL 3375238, at *2 (W.D. Pa. July 3, 2014); Jovanovich v. Ind. Ha rbor Belt R.R. Co. , No. 1-19-2550, 2020 WL 5843957, at *6–7 (Ill. App. Ct. Sept. 30, 2020). We agree with those courts and conclude that the Hertz nerve-center test applies in the general-jurisdiction

context. The minimum-contacts test is less stringen t if the plaintiff’s claims arise from or relate to the defendant’s forum contacts. See Ford Motor Co. , 141 S. Ct. at 1024– 25. This kind of personal jurisdiction is ca lled specific or case-linked jurisdiction. Id . at 1024. Specific-jurisdiction minimum contacts are present if the defendant–8– purposefully availed itself of the privilege of conducting activities in the forum state. Id . at 1024–25.
B. The Pleaded Bases of Ju risdiction in This Case Appellants’ live petition contains two ju risdictional allegations against AV Europe. It alleges that AV Europe “is a German limited liability company operating in Dallas County, Texas. ” It also alleges that “[v]enue is proper in Dallas County . . . because all or a substantial part of the ev ents or omissions giving rise to the claim occurred in Dallas County and Defendants’ principal offices in the State of Texas and [sic] are all locate d in Dallas County.” Given Texas’s liberal notice-pleading sta ndards, we conclude that appellants’ petition sufficed to allege that AV Europe is subject to general jurisdiction in Texas. The petition asserts that each defendant’s principal office in Texas is in Dallas County, which suggests that general ju risdiction is proper. Additionally, the allegation that AV Europe is “operating in Dallas County” is broad enough to encompass the premise that AV Europe’s nerve center is in Texas. AV Europe’s special appearance shows th at AV Europe understood the petition to allege general jurisdiction because the special appearance averred that AV Europe did not have continuous or systematic contacts with Texas, was not a “resident business organization,” and had never b een such an organization. Thus, AV Europe bore the burden to ne gate general jurisd iction in Texas. See Kelly , 301 S.W.3d at 658.–9– C. The Implied Findings and the Evidence in This Case As to general jurisdiction, the trial c ourt implicitly found both that AV Europe was not organized in Texas an d that its principal place of business was not in Texas when suit was filed. See Daimler AG , 571 U.S. at 137. Appe llants attack the second implied finding. The special-appearance evidence, which consists principally of Hardy’s declaration and excerpts from Hardy’s de position, supports the following facts: AV Europe was formed as a German company on or about July 21, 2016. AV Europe’s parent company is and always has been HW&B, a Texas limited liability company with its principal place of busine ss in Texas. Hardy is HW&B’s manager. HW&B’s only involvement with AV Europe was to sell a nd ship products to AV Europe for resale. From July 2016 to the fall of 2017, AV Europe’s managing director was Thomas Reichert, 1 who lived in Germany and was entirely responsible for AV Europe’s operation. AV Europe’s firs t headquarters was Reichert’s home in Germany. Then it moved its headquarter s to a converted airplane hangar in Germany. All of AV Europe’s operations were conducted from those two locations. While AV Europe was operating, it had eight or nine employees, all of whom were located in Germany.

1 In the appellate record, this person’s name appears as both “Reichert” and “Reichart.”–10– In fall 2017, Reichert was terminated for cause. Sean Higgins, who was a United Kingdom resident living in England, assumed the role of managing director for about a month. On November 20, 2017, Hardy became AV Europe’s managing director, and he remained managing director at the time of this litigation. Hardy moved to Texas in 2005 and has maintained a residence in Texas since then. He lived in New York for a time but resumed living in Texas full- time in July 2018. He testified in his deposition that he “was a resident of Ne w York for a period of time,” but then he answered, “No,” when asked if he “eve r bec[a]me a New York resident.” In approximately June 2018, AV Europe stopped conduc ting business. It later shipped all unsold products back to HW&B . It now has no employees. According to Hardy’s declaration, AV Europe (1) never had a principal place of business in Texas, (2) never engaged in busine ss in Texas other than buying products from HW&B for resale in Europe, (3) does not own any real estate in Texas, (4) maintains no bank accounts or other accounts with financial in stitutions in Texas, and (5) “has been winding down, but has not been formally dissolved.” Hardy testified in his deposition that HW&B employees searched through HW&B’s records in Texas to find documents responsive to discovery requests sent to AV Europe. He also testified that AV Europe still has a post-office box for receiving mail, but when asked where it was he replied, “I don’t know offhand if it’s Munich—a Munich or—address. Agai n, there’s no—there’s no operations–11– whatsoever being conducted there. Nothi ng.” To Hardy’s knowledge, no one checks AV Europe’s post-office box for mail. D. AV Europe’s evidence was legally insufficient to negate generaljurisdiction minimum contacts. AV Europe bore the burden to prove th at AV Europe’s principal place of business—i.e., its nerve center—was not in Texas in January 2019 when suit was filed. We conclude that its evidence wa s legally insufficient to prove this fact. Accordingly, AV Europe did not carry its burden to negate general-jurisdiction minimum contacts in Texas.
1. The Nerve-Center Evidence Under the nerve-center test, we inquire where AV Europe’s officers directed, controlled, and coordinated the company’s activities as of January 2019, when suit was filed. See Ascentium Capital LLC , 558 S.W.3d at 829, 831. There is evidence to support implied findings that AV Europe’s managing director was Thomas Reichert, a German resident, from July 2016 until September or October 2017, and then Sean Higgi ns, a United Kingdom resident, until November 2017. But in November 2017, Ha rdy became AV Europe’s managing director, and he remained managing director when suit was filed in January 2019. The evidence about the location of AV Europe’s nerve center during this critical time period is

scant.–12– First, we consider the time period fro m November 2017 to June 2018, when AV Europe ceased operations: • We see no evidence showing wh ere AV Europe’s headquarters, if any, was during this time period. • Hardy testified that his res ponsibilities were to oversee operations and ensure compliance with the German government. • Although Hardy twice went to Germany on AV Europe business, we see no evidence that Germa ny was the place from which he or any other officers directed, controlled, and coordinated AV Europe’s activities. • Hardy testified that in around May or June 2018 “we made the decision” to wind down AV Europe, but we see no evidence showing who else was involved in this decision or, more importantly, where the decision was made. • Hardy testified that he moved to Texas in 2005, maintained a residence in Texas from 2005 to 201 8, was a New York resident for an unspecified “period of ti me,” and began living in Texas full-time in July 2018. This evidence does not support a reasonable inference that fro m November 2017 to June 2018 Hardy controlled AV Europe’s ope rations from any particular location, much less one outside of Texas. We conclude that the evidence is legally in sufficient to show that AV Europe’s nerve center was outside of Texas fro m November 2017 to June 2018. As to the remaining time period, June 2018 until the filing of suit in January 2019, the trial court could credit Hardy’s declaration testimony that “AV Europe has conducted no business since approximately June 2018 and has no employees.” However, Hardy’s declaration and depos ition also established the following additional facts: • Hardy is still AV Europe’s managing director.–13– • Hardy has lived in Texas full-time since July 2018. • “Following the cessation of its business, AV Europe shipped to HW&B and HW&B received al l unsold product and credited AV Europe’s account receivable fo r returned product.” (Hardy declaration.) • AV Europe “has been winding down.” (Hardy declaration.) • AV Europe has not been formally dissolved. Thus, AV Europe’s own evidence shows th at its managing director has lived in Texas full-time since July 2018. It also shows that since June 2018 AV Europe “has been winding down,” which implies some le vel of activity, and that its activities have included at least the return of uns old products to HW&B. We see no evidence showing the location from which Hardy or any other AV Europe officer (if any) controlled these activities. We therefore conclude that the evidence was legally insufficient to show that AV Europe’s ne rve center was outside of Texas from June 2018 until the filing of suit in January 2019. 2. AV Europe’s Arguments AV Europe cites the statement in Har dy’s declaration that “AV Europe does not [have] and has never had a principal pl ace of business in Te xas.” However, this statement is conclusory and, thus, no t probative evidence unless supported by additional facts. See T EX

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. P. 120a(3) (affidavits “sha ll set forth specific facts as would be admissible in evidence”); Ennis v. Loiseau , 164 S.W.3d 698, 703–04 (Tex. App.—Austin 2005, no pet.) (statement s such as “[a]s an individual, I do not have any continuing or sy stematic contacts with Te xas” were conclusory); see also–14– Rogers v. Zanetti , 517 S.W.3d 123, 130 (Tex. A pp.—Dallas 2015) (conclusory testimony is no evidence), aff’d , 518 S.W.3d 394 (Tex. 2017). We conclude that Hardy’s declaration does not contain the facts necessary to make his assertion nonconclusory. Hardy’s declaration focuses on the ab sence of general business activity in Texas, but under the nerve-center test th e relevant fact is where the company’s officers exercise their control over the company—not where th e company’s business activity occurs. Hardy’s declaration doe s not show that AV Europe was not controlled from Texas after Hardy beca me managing director. Indeed, his declaration specifies only that he had no managerial role in AV Europe while his two predecessors served as managing dir ector: “While [AV Europe] was operating and during the time Reichert and Higgins served as Geschäftsführer (Managing Director), neither me personally nor HW&B Enterprises had a ny managerial role with respect to AV Europe .” He acknowledged in his deposition that AV Europe still had operations “[f]or a very brief tim e” after he became ma naging director, but he did not specify where he carried out hi s role. Thus, Hardy’s statement that AV Europe has never had a principal place of business in Texas is conclusory and not probative. AV Europe also points out that appella nts’ brief includes a statement that “[b]y June 2018, AV Europe di d little more than maintain its records.” But this is not a concession that AV Europe had no activities after June 2018—only that those–15– activities were minimal. And appellants’ brief also asserts that “AV Europe’s management and operation ha ve been conducted from Texa s” since the collapse of its business in Germany. The place of ma nagement, not operation, is what matters in a nerve-center analysis. AV Europe also argues that “the nerve center test does not apply to defunct companies like AV Europe.” But as disc ussed above, AV Europe has not shown itself to be defunct; the evidence shows th at it exists, has a managing director, has been “winding down,” and ha s conducted activities at least to the extent of shipping products to HW&B even after ceasing business operations. Thus, AV Europe’s proposition regarding defunct companies does not apply to th e facts of this case even if it is a correct statement of the law. AV Europe also points to Hardy’s de position testimony, gi ven after suit was filed, that his managing-director positio n currently has no responsibilities because “AV Europe no longer has operations.” Bu t as discussed above, the relevant time period is the time leading up to the filing of suit, and the evidence (1) shows that AV Europe engaged in some activities afte r Hardy became managing director in November 2017 and (2) does not show where Hardy or any other officer controlled AV Europe’s activities during the criti cal November 2017–January 2019 time period. Thus, Hardy’s deposition testimony does not defeat gene ral jurisdiction.–16– 3. Conclusion We hold that AV Europe produced lega lly insufficient evidence to negate general-jurisdiction minimu m contacts with Texas. E. AV Europe failed to establish that the exercise of personal jurisdiction over it would offend traditional noti ons of fair play and substantial justice. Appellants also argue that the exerci se of personal jurisdiction over AV Europe will not offend traditi onal notions of fair play and substantial justice. Although the Supreme Court recently indicated that the “fair play and substantial justice” test need not be met if general- jurisdiction minimum contacts are present,

see Daimler AG , 571 U.S. at 139 n.20, appellants do not make this argument, so we do not consider it, see State Bar of Tex. v. Evans , 774 S.W.2d 656, 658 n.5 (Tex. 1989) (per curiam). Nevertheless, we agree with appellants’ argument as presented. AV Europe bore the burden of pres enting a compelling case that the circumstances make the exercise of jurisdiction over it unreasonable. See Spir Star AG v. Kimich , 310 S.W.3d 868, 878–79 (Tex. 2010). For an international defendant such as AV Europe, we consider factor s such as (1) the burden on the defendant, (2) the forum’s interest in adjudicating the dispute, (3) the plaintiff’s interest in obtaining convenient and effective relief, (4) the international judicial system’s interest in obtaining the most efficient reso lution of controversies, and (5) the several nations’ shared interest in furthering f undamental substantive social policies. See id

. at 878.–17– We see no evidence that defending this case will place any unusual burden on AV Europe. See id . at 879 (noting that distance alone cannot ordinarily defeat jurisdiction). AV Europe does not dispute appellants’ allegation that one plaintiff is a Texas corporation with its principal plac e of business in Texas; thus, Texas has some interest in adj udicating this dispute. See id . Appellants have an interest in trying their claims against all defendants in a single lawsuit rather than piecemeal, and the international judicial system has a similar interest in a voiding unnecessarily multiplying lawsuits. See id . (it is more efficient to ad judicate an entire case in the same place). The last fair-play factor, re garding substantive social policies, has no obvious application here. We conclude that AV Eu rope has not presented a compelling case that the circumstances make the exercise of jurisdiction over it unreasonable. F. Conclusion: We sustain appellants’ first issue. For the foregoing reasons, we sustain appe llants’ first issue and conclude that the trial court erred by sustaining AV Eur ope’s special appearance. We need not decide whether AV Europe successfully negated specific-jurisdiction minimum contacts or whether the trial court erred by not allowing appellants to amend their pleadings.–18– V. Disposition We reverse the trial court’s order sust aining AV Europe’s special appearance, render judgment denying AV Europe’s speci al appearance, and remand the case to the trial court for further proceedi ngs consistent with this opinion.

200558F.P05 /Dennise Garcia/ DENNISE GARCIA JUSTICE–19– 

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Court of Appeals Fifth District of Texas at Dallas JUDGMENT

FOREVER LIVING PRODUCTS INTERNATIONAL, LLC, A NEVADA LIMITED LIABILITY COMPANY, AND ALOE VERA OF AMERICA, INC., A TEXAS CORPORATION, Appellants

No. 05-20-00558-CV V. AV EUROPE GMBH, A GERMAN LIMITED LIABILITY COMPANY, Appellee On Appeal from the 191st Judicial District Court, Dallas County, Texas Trial Court Cause No. DC-19-00270. Opinion delivered by Justice Garcia. Justices Myers and Partida-Kipness participating.

In accordance with this Court’s opinion of this date, the trial court’s “Order Sustaining AV Europe GmbH’s Objection to Jurisdiction [sic]” is REVERSED and judgment is RENDERED denying AV Europe GmbH’s First Amended Special Appearance to Present Moti on Objecting to Jurisdiction. We REMAND the case for further proceedings consistent with the opinion. It is ORDERED that appellants Forever Living Products International, LLC, A Nevada Limited Liability Company, and Aloe Vera Of America, Inc., A Texas Corporation recover their costs of this appeal from appellee AV Europe GmbH, A German Limited Liability Company.
Judgment entered July 30, 2021