* Pursuant to Local Rule 47.5, the court has determined that this

opinion should not be published and is not precedent except under the limited

circumstances set forth in Local Rule 47.5.4.

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_______________________

No. 95-31037

_______________________

TELEPHONE ELECTRONICS CORP; TECNET INC; 

METROLINK INC; LARRY D FERK,

Plaintiffs - Appellants,

versus

SOUTHERN PACIFIC TELECOMMUNICATIONS CO,

Defendant - Appellee.

_________________________________________________________________

Appeal from the United States District Court

for the Western District of Louisiana

(94-CV-1302)

_________________________________________________________________

September 10, 1996

Before KING, JONES, and SMITH, Circuit Judges.

EDITH H. JONES, Circuit Judge:*

Telephone Electronics Corp., Tecnet, Inc., Metrolink,

Inc., and Larry Ferk appeal the decision of the district court

dismissing their claim against Southern Pacific Telecommunications

Co. for lack of personal jurisdiction and improper venue. Appellee

contends that the corporate appellants, not registered as foreign

corporations doing business in Louisiana, were not allowed to sue

in Louisiana. Finding Appellants have made a prima facie showing
1 SP Telecom (now known as Qwest Communications Corporation) acquired

all of the outstanding shares of stock of DSI in April 1990. Thereafter, DSI was

merged into SP Telecom. Tecnet is a wholly owned subsidiary of TEC formed as a

result of the Network Agreement to assist TEC in its contractual obligations with

DSI. Metrolink is owned solely by Ferk and has an agreement with TEC by which

it receives five percent of the gross revenue due to TEC under the Network

Agreement.

2

of personal jurisdiction and are not barred by the state doorclosing statute for purposes of this case, we REVERSE.

I. BACKGROUND

The parties are involved in the telecommunications

industry. Telephone Electronics Corp. (TEC), Tecnet, Metrolink,

and Ferk brought suit against Southern Pacific Telecommunications

Co. (SP Telecom) as successor to Digital Signal, Inc. (DSI).1 The

complaint alleged that shortly before DSI and SP Telecom merged,

DSI began violating an agreement it had with TEC regarding a

nationwide telephone network that was operated and maintained by

TEC and DSI. The complaint further alleged that this breach was

done intentionally and continued after the merger of DSI and SP

Telecom. 

Appellants’ complaint was filed in federal district court

in Louisiana and claimed SP Telecom/DSI breached three contracts.

First, a “confidentiality agreement” entered into in February 1987

by Ferk, LDS NET, Inc., TEC, and DSI for the purpose of protecting

Ferk as he disclosed confidential information to the other parties

regarding the establishment of a telephone communications system.

Second, a subsequent “Network Agreement” entered into by TEC and
2 Com Systems and DSI entered into an agreement in April 1987 in which

DSI agreed to provide certain long distance services for Com System. According

to Appellants, DSI and TEC agreed that TEC was to receive all of the Com System

account revenue for capacity west of the Mississippi River for as long as either

DSI or TEC or their successors had an agreement with Com System.

3 In an earlier order, the district court denied SP Telecom’s motion

to dismiss for lack of subject matter jurisdiction.

4 TEC is a Mississippi corporation with its principal place of business

in Jackson, Mississippi. Tecnet is also a Mississippi corporation whose original

principal place of business was moved in late 1988 from Jackson, Mississippi to

Dallas, Texas. Metrolink is a Florida corporation whose principal place of

business is in Boca Raton, Florida. Ferk is an individual domiciled in Florida.

DSI was a Delaware corporation whose principal place of business was in

Southfield, Michigan. SP Telecom is a Delaware corporation whose principal place

of business prior to June 1994 was in San Francisco, California, and thereafter

in Denver, Colorado.

3

DSI to establish a nationwide long distance telephone network. And

third, an agreement between DSI and TEC whereby TEC was to receive

part of the revenue received from Com Systems, Inc., one of the

customers of the Network Agreement.2 

SP Telecom moved to dismiss for lack of personal

jurisdiction, failure to plead subject matter jurisdiction, and for

improper venue. The motion was referred to a magistrate judge who

issued a report recommending that the motion to dismiss for lack of

personal jurisdiction and improper venue be granted.3

 In concluding that the court lacked personal

jurisdiction, the magistrate judge initially noted that neither TEC

or Tecnet are Louisiana residents and as such any activity of SP

Telecom directed at them cannot be considered as activity directed

at a Louisiana resident.4 The magistrate judge then found that

despite several meetings between the parties in Louisiana; repeated

contact by phone and fax with Tecnet in Louisiana; work done in
4

Louisiana by Tecnet relating to the Network Agreement; and mailing

of payments by DSI to Tecnet in Monroe, Louisiana; that the

contacts of SP Telecom/DSI with Louisiana did not constitute

sufficient purposeful activity directed at Louisiana for purposes

of finding specific personal jurisdiction. Further, the magistrate

judge found that Appellants failed to make a prima facie showing of

general personal jurisdiction and that it would be unfair for SP

Telecom to defend itself in Louisiana. The recommendation of

dismissal for improper venue was based on lack of jurisdiction over

defendants. The magistrate judge also ruled that the corporate

plaintiffs were engaged in interstate long distance business so

that they did not have to qualify under Louisiana’s door closing

statute, La. Rev. Stat. Ann. §§ 12:314A and 12:302H (West 1994), to

pursue this action. 

The district court adopted the magistrate judge’s report

and dismissed Appellants’ case without prejudice. Appellants

timely appealed.

II. DISCUSSION

A. Personal Jurisdiction and Venue

When a nonresident defendant, such as SP Telecom, moves

to dismiss for lack of personal jurisdiction, the plaintiff has the

burden of establishing jurisdiction over the nonresident defendant.

Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir. 1985). When the

motion to dismiss is ruled on, as here, without an evidentiary
5

hearing, the district court must accept as true uncontroverted

allegations in the plaintiff’s complaint and resolve all factual

conflicts contained in the parties affidavits in favor of the

plaintiff. Trinty Industries v. Myers & Associates, Ltd., 41 F.3d

229, 230 (5th Cir.), cert. denied, __ U.S. __, 116 S. Ct. 52

(1995); Wilson v. Belin, 20 F.3d 644, 646 (5th Cir.), cert. denied,

__ U.S. __, 115 S. Ct. 322 (1994). The plaintiff need only present

a prima facie case that personal jurisdiction is proper. Belin, 20

F.3d at 648; Bullion v. Gillespie, 895 F.2d 213, 217 (5th Cir.

1990). Review of the district court’s grant of a motion to dismiss

for lack of personal jurisdiction is de novo. Kevlin Services, Inc.

v. Lexington State Bank, 46 F.3d 13, 14 (5th Cir. 1995). 

Federal courts sitting in diversity exercise personal

jurisdiction over nonresident defendants to the same extent as the

forum state court. Belin, 20 F.3d at 646. Personal jurisdiction

attaches when the nonresident defendant is “amenable to service of

process under the forum state’s long-arm statute and the exercise

of jurisdiction comports with the due process clause of the

fourteenth amendment.” ASARCO, Inc. v. Glenara, Ltd., 912 F.2d

784, 786 (5th Cir. 1990). Because the Louisiana long-arm statute

extends to the full reach of the constitution, whether SP Telecom

is subject to personal jurisdiction depends on the parameters of

federal due process. Id. at 786. 
6

The exercise of personal jurisdiction over nonresident

defendants is proper if two requirements are satisfied. First, the

nonresident defendant must have purposefully established “minimum

contacts” with the forum state. ASARCO, 912 F.2d at 786. And

second, the maintenance of the suit must not offend “traditional

notions of fair play and substantial justice.” Ruston Gas Turbines,

Inc. v. Donaldson Co., Inc., 9 F.3d 415, 418 (5th Cir.

1993)(quoting International Shoe Co. v. Washington, 326 U.S. 310,

316, 66 S. Ct. 154, 158 (1945)).

The “minimum contacts” prong of the due process analysis

may be subdivided into two different classifications of personal

jurisdiction depending on the types of contacts the nonresident

defendant has with the forum state. Belin, 20 F.3d at 647;

Bullion, 895 F.2d at 216. “Specific” personal jurisdiction arises

when the “nonresident defendant’s contacts with the forum state

arise from, or are directly related to, the cause of action.”

Belin, 20 F.3d at 647. “General” personal jurisdiction, in

contrast, permits claims to be asserted against nonresident

defendants, even claims not directly related to the nonresident

defendant’s contacts with the forum state, “if the defendant’s

contacts with the forum state are both ‘continuous and

systematic.’” Belin, 20 F.3d at 647; see Ruston Gas, 9 F.3d at 419.

SP Telecom contends the district court properly dismissed

the complaint for lack of personal jurisdiction. SP Telecom
7

asserts it did not purposefully avail itself of the privilege of

doing business in Louisiana and that any contact with Louisiana

resulted from the unilateral activity of Appellants. We disagree.

As noted, specific personal jurisdiction arises when the

nonresident defendant’s contacts with the forum state directly

relate to the cause of action. The number of contacts the

nonresident defendant has with the forum state, by itself, is not

determinative; nor may jurisdiction be based on the unilateral

activity of the plaintiff. Polythane Systems, Inc. v. Marina

Ventures Int’l Ltd., 993 F.2d 1201, 1205 (5th Cir. 1993), cert.

denied, 510 U.S. 1116, 114 S. Ct. 1064 (1994); D.J. Investments,

Inc. v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542,

547 (5th Cir. 1985); Hydrokinetics, Inc. v. Alaska Mechanical,

Inc., 700 F.2d 1026, 1028 (5th Cir. 1983), cert. denied, 467 U.S.

1257, 104 S. Ct. 3549 (1984). However, even a single act by a

nonresident defendant 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,” may

be sufficient to establish specific personal jurisdiction. Ruston,

9 F.3d at 419 (quoting Burger King Corp. v. Rudzewicz, 471 U.S.

462, 475, 105 S. Ct. 2174, 2183 (1985)). In determining whether

the nonresident defendant has made purposeful contact with the

forum state, we consider the “quality, nature, and extent of the

activity in the forum [and] the foreseeability of consequences
8

within the forum from activities outside it.” Hydrokinetics, 700

F.2d at 1028 (quoting Prejean v. Sonatrach, Inc., 652 F.2d 1260,

1268 (5th Cir. 1981)).

In this case, Appellants have made a prima facie showing

of specific personal jurisdiction. See Bullion, 895 F.2d at 217

(finding the district court failed to recognize that only a prima

facie case of personal jurisdiction need be shown). The facts

presented by Appellants show repeated contact between the parties

in Louisiana, particularly Monroe, Louisiana where Walter Frank,

executive vice president of TEC and vice president of Tecnet,

maintained and primarily used an office during the relevant time

period. For example, the Confidentiality Agreement entered into

by Ferk, DSI, TEC, and LDS Net was signed in Monroe. Discussions

and negotiations concerning the establishment of the network were

conducted in Monroe and New Orleans by Frank and DSI officials, and

Frank signed the Network Agreement for TEC in Monroe. Once the

Network Agreement was reached, DSI and Tecnet met at least five

times over the next fourteen months in Monroe or New Orleans to

discuss various aspects of the network. Numerous telephone calls,

faxes, and letters were made between DSI in Michigan and Tecnet in

Monroe concerning the network. Further, the Tecnet office in

Monroe provided a variety of services relating to the continued

operation of the network, including becoming involved in the
5 In assessing the reasonableness of the exercise of jurisdiction, we

consider the burden on the nonresident defendant, the interest of the forum

state, the plaintiff’s interest in securing relief, the judicial system’s

interest in efficient resolution of the controversy, and the shared interest of

the several states. Asahi Metal Industry Co., Ltd. v. Superior Court of

California, 480 U.S. 102, 113, 107 S. Ct. 1026, 1033 (1987).

9

administration of the network; and some of the points of presence

in the network were located in Louisiana.

Aggregating DSI’s contacts with Louisiana, it is clear

that these contacts cannot be characterized as “random, fortuitous,

or incidental,” but rather represent deliberate and purposeful

contact with Louisiana with foreseeable consequences within

Louisiana. Trinity, 41 F.3d at 231; see also Polythane, 993 F.2d

at 1207; Bullion, 895 F.2d at 217. Appellants have shown

sufficient minimum contacts for purposes of specific personal

jurisdiction.

Separately, we do not find it unfair or unreasonable for

SP Telecom to litigate in Louisiana.5 SP Telecom is involved in

providing telecommunication services nationwide. Substantial

contact with Louisiana over a three year period occurred as a

result of the Network Agreement. Much of the documentary evidence

and many of the potential witnesses are in Monroe, Louisiana.

Although Louisiana may be less convenient for SP Telecom than an

alternative forum, we cannot say that litigation of this claim in

Louisiana is unfair or unreasonable. See Polythane, 993 F.2d at

1206; see also Compuserve, Inc. v. Patterson, 89 F.3d 1257 6th Cir.

1996)(Internet user/provider subject to personal jurisdiction in
10

Ohio even though only contacts with Ohio were electronic in

nature).

Concomitantly, because the district court’s only reason

for holding venue improper was its erroneous conclusion on personal

jurisdiction, the dismissal for improper venue must also be

reversed.

B. Door-Closing Statute

SP Telecom contends the district court erred in rejecting

its argument that Appellants’ claim is barred by Louisiana’s “doorclosing” statute. The Louisiana “door-closing” statute provides

that “[n]o foreign corporation transacting business in this state

shall be permitted to present any judicial demand before any court

of this state unless it has been authorized to transact business,

if required by, and as provided in, this Chapter.” La. Rev. Stat.

Ann. § 12:314A (West 1994). An exception to this rule exists if a

foreign corporation is “[t]ransacting any business in interstate or

foreign commerce.” Id. § 12:302H. The burden of proving the

application of the door-closing statute is on the party asserting

its application. Charles Pfizer & Co., Inc. v. Tyndall, 287 So.2d

552, 553 (La. Ct. App. 1973).

SP Telecom contends that TEC and Tecnet are foreclosed

from suing in Louisiana pursuant to Section 12:314A. SP Telecom

notes that neither TEC nor Tecnet is qualified to do business in

Louisiana and asserts that notwithstanding the interstate nature of
6 SP Telecom also contends this court lacks subject matter jurisdiction

because two nondiverse subsidiaries should be joined as indispensable parties and

be treated as one with TEC for jurisdictional purposes. The presence of a

11

their activities, Appellants have “localized” their business

presence in Monroe, Louisiana to such an extent that they are

present there and are subject to the qualification requirements.

We disagree.

Under the Network Agreement, DSI and TEC established a

nationwide telecommunications network. The network ranged from San

Diego to Boston, with all points in-between. The activities of

Tecnet in Monroe were essential to, and inseparable from, the

interstate nature of the nationwide telecommunications network and

as such do not necessarily constitute a localization of activities

or establish a distinct intrastate focus. See Radio WHKW, Inc. v.

Yarber, 838 F.2d 1439, 1444 (5th Cir. 1988); Diversacon Industries,

Inc. v. National Bank of Commerce, 629 F.2d 1030, 1034-35 (5th Cir.

1980); Fred Hale Machinery, Inc. v. Laurel Hill Lumber Co., Inc.,

483 F.2d 58, 60 (5th Cir. 1973). But caselaw clearly dictates that

regardless whether the door-closing statute might prevent

Appellants’ access to courts in Louisiana to pursue intrastate

lawsuits, the statute may not bar suits directed at activity with

an “interstate character.” Fred Hale Machinery, Inc., 483 F.2d at

60. The lawsuit against SP Telecom has that character. See Eli

Lilly & Co. v. Sav-On Drugs, Inc., 366 U.S. 276, 282, 81 S. Ct.

1320 (1961).6
subsidiary may not, however, be attributed to the parent absent “proof of control

by the parent over the internal business operations and affairs of the

subsidiary.” Hargrave v. Fibreboard Corp., 710 F.2d 1154, 1161 (5th Cir. 1983);

see Freeman v. Northwest Acceptance Corp., 754 F.2d 553, 557-58 (5th Cir. 1985).

“The degree of control exercised by the parent must be greater than that normally

associated with common ownership and directorship.” Hargrave, 710 F.2d at 1160.

SP Telecom points to no evidence of such control except for a letter indicating

one of the subsidiaries may have a claim against SP Telecom arising from the

Network Agreement; an exchange of letterhead designs; payment of Tecnet invoices

to the payment center of one of the subsidiaries; and the assertion that the

subsidiaries were primary participants in the facts relating to the complaint.

This evidence is insufficient to establish the necessary control of a parent over

its subsidiary to attribute the presence of the subsidiary to the parent.

12

III. CONCLUSION

For the foregoing reasons, the judgment of the district

court is REVERSED and REMANDED for proceedings consistent herewith.