Court Opinion

ID: 4455660
Source: CourtListenerOpinion
Date Created: 2019-11-14 11:12:51.472383+00
Date Added: 2024-06-11T14:45:24.383693
License: Public Domain

Reverse and Render; Opinion Filed November 12, 2019

                                             In The
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                      No. 05-19-00195-CV

                     AEG POWER SOLUTIONS GMBH, Appellant
                                    V.
                  CREATION TECHNOLOGIES TEXAS, LLC, Appellee

                       On Appeal from the 14th Judicial District Court
                                   Dallas County, Texas
                            Trial Court Cause No. DC-18-15065

                             MEMORANDUM OPINION
                          Before Justices Myers, Osborne, and Nowell
                                   Opinion by Justice Myers
       This is an accelerated interlocutory appeal from an order denying appellant AEG Power

Solutions GmbH’s special appearance. In one issue, it argues the trial court erred in denying the

special appearance because the record does not support specific personal jurisdiction. We reverse

and render judgment dismissing for lack of jurisdiction.

                          BACKGROUND AND PROCEDURAL HISTORY

       In September of 2012, Creation Technologies Texas, LLC (“Creation”), a Texas company,

entered into a Manufacturing Agreement with a Texas-based company, AEG Power Solutions

USA, Inc., subsequently known as 3W Power Solutions USA, Inc. (“AEG USA”). In line with

the Manufacturing Agreement, AEG USA placed purchase orders with Creation in June of 2013

for the manufacture of solar inverters, which convert the output of a solar panel into a utility

frequency. These purchase orders were placed, at least in part, to fulfill an order from another
company, Power Max Co., Ltd., which was in the business of, among other things, developing and

selling solar electric power plants in Japan to investors. Power Max, however, failed to pay AEG

USA, and by January of 2014 AEG USA owed Creation over $2 million under the terms of the

Manufacturing Agreement. In February of 2014, AEG USA entered into a Security Agreement

with Creation to avoid termination of the Manufacturing Agreement. The Security Agreement,

executed in the Netherlands on AEG USA’s behalf by Jeffrey Casper, a non-Texas resident, gave

Creation a continuing security interest in AEG USA’s accounts, equipment, and inventory.

          AEG USA, meanwhile, sued Power Max in a Texas court in June of 2015 for breach of

contract, and the case was removed to federal court in October of 2015. AEG USA subsequently

settled the case, and the proceeds of the settlement were paid to Creation, which had intervened in

the case.1

          AEG USA is the United States subsidiary of AEG Power Solutions, B.V., its Dutch parent

company (“AEG Power Solutions”). In March of 2017, Creation’s German counsel wrote to the

general counsel for AEG Power Solutions’ German subsidiary, AEG Power Solutions GmbH

(“AEG Germany”). This letter stated that it appeared AEG USA had defaulted under the terms of

the Manufacturing Agreement and had “only accepted (and paid) a rather small portion of the

goods ordered under the Manufacturing Agreement.” The letter also stated that “[t]he aggregate

amount owed to Creation at this stage amounts to approx. $5 million, plus interest,” and noted that

AEG USA had “closed down its R&D and sales office in the United States and has transferred the

existing products and activities to AEG [Germany].”                              AEG Germany was in insolvency

proceedings in Germany at the time, as acknowledged in Creation’s letter, and the letter noted that

     1
        We take judicial notice of the United States District Court for the Eastern District of Texas, Sherman Division’s November
7, 2016 corrected memorandum opinion and order granting in part plaintiff’s motion for summary judgment and denying
defendant’s motion for partial summary judgment; the court’s order of March 21, 2017; the parties’ joint status report of March 31,
2017; and the court’s agreed order of dismissal of June 16, 2017. See, e.g., 3W Power USA, Inc. f/k/a AEG Power Solutions USA,
Inc. v. PowerMax Co., Ltd., Case No. 4:15-CV-677, 2016 WL 6581996 (E. D. Tex. Nov. 7, 2016).

                                                              –2–
counsel had “been asked to assist our US co-counsel in possible legal action in federal court in

Dallas County, Texas against” AEG USA, AEG Germany, and “other associated enterprises.” In

December of 2017, Creation’s German counsel made a demand upon AEG Germany for $8.976

million. On August 3, 2018, two months before the underlying lawsuit was filed, Creation’s Texas

counsel sent a letter to AEG Germany notifying it to preserve evidence and electronically stored

information. Attached to the letter was a draft of a complaint to be filed in the judicial district

court of Dallas County, Texas.

          According to the declaration of Paul Van Der Harten, the chief financial officer of AEG

Power Solutions Group and the managing director of AEG Germany, AEG Germany is a German

company headquartered in Warstein, Germany. Jeffrey Casper––currently the CEO of AEG

Power Solutions and, at the time of the events that formed the basis for the underlying lawsuit, a

director for AEG USA and AEG Power Solution’s chief restructuring officer and chief financial

officer––states in his January 31, 2019 declaration2 that AEG Germany was formed under the laws

of Germany in Warstein-Belecke, “registered at the District Court of Arnsberg.” Casper declares

that, like its sister company AEG USA, AEG Germany is a subsidiary of AEG Power Solutions

“and was not part of the decision to enter into the Manufacturing Agreement,” nor was it “a party

thereto.” Casper adds that AEG Germany was not a part of the “order process” with Power Max

and AEG USA, nor was it a party to the Security Agreement between AEG USA and Creation.

          Casper states in his declaration that, as a German company, AEG Germany files its tax

returns in Germany. Additionally, “[d]uring the relevant time period,” AEG Germany “employed

individuals in Germany,” “paid them for their services,” and “provided them with benefits

including health care.” “AEG Germany maintains separate and distinct bank accounts from any of

the other defendants,” and “[t]o the extent there were any intra-company transfer of funds, those

   2
       Casper supplied two declarations.

                                                –3–
transfers were documented, and Germany was required to repay the transferor.” “In situations

where common positions were used to provide services to different subsidiaries,” such as the

general counsel position, “AEG Germany would pay a share of that person’s salary.” “AEG

Germany does not have any bank accounts, real property, offices, employees or agents in Texas.”

       Casper’s declaration explains that AEG Germany “manufacturers and distributes products

in the oil & gas segment in compliance with the International Electrotechnical Commission (‘IEC’)

standards which are recognized worldwide with the exception of a few countries, including the

United States, and Japan.” Casper states: “AEG Germany does not manufacture, market, sell, or

distribute products in the oil & gas segment anywhere in the United States, which requires

compliance with standards set by Underwriters Laboratories, Inc. (‘UL’).” AEG Germany’s IEC-

compliant products cannot “be used in the United States because they are not UL-compliant,”

according to Casper. Regarding the Germany insolvency proceedings, Casper states that AEG

Germany went through insolvency proceedings in Germany beginning on November 22, 2016,

and continuing through the first two quarters of 2017, with a final order dated May 1, 2017. Casper

adds that “Creation did not file any claims in those proceedings.”

       According to Van Der Harten’s declaration, AEG Germany has not agreed to perform a

contract in whole or part in Texas; it does not own real property or have any assets in Texas; it

does not maintain an office or other point of contact in Texas; it has not purposefully availed itself

of the privilege of conducting activities in Texas; it has not solicited business in Texas or with any

person or entity in Texas; it does not maintain a registered agent in Texas; and it has not committed

a tort or statutory violation in Texas.

       Van Der Harten’s declaration acknowledges that, after the execution of the Security

Agreement, AEG Germany “facilitated the sale of component parts of the inverters (originally

ordered by AEG Power Solutions USA) to companies outside of the United States to mitigate

                                                 –4–
[Creation’s] damages.” Van Der Harten states that, as part of this effort, AEG Germany “paid

[Creation] directly based on invoices from [Creation].” Invoices from Creation that are included

in the record show there were six individual sales from Creation to AEG Germany. The dates on

these invoices indicate the sales took place on 4/30/15, 9/1/15, 10/29/15, 12/16/15, 7/12/16, and

7/14/16. However, Van Der Harten signals that there was no previous or ongoing business

relationship between Creation and AEG Germany, stating that “[n]o other agreements, contracts,

or purchase orders have been entered into between AEG [Germany] and a Texas company.”

Furthermore, according to Van Der Harten, AEG Germany “has never sold any inverters” and “no

inverters or inverter components were sold by AEG [Germany] in the State of Texas.”

       On October 3, 2018, Creation filed the underlying lawsuit against AEG Power Solutions;

AEG USA; AEG Germany; AEG Power Solutions Sdn Bhd, AEG Power Solutions’ Malaysian

subsidiary (“AEG Malaysia”); 3W Power S.A., AEG Power Solutions’ Luxembourg-based

holding company (“AEG Luxembourg”); and Jeffrey Casper (collectively, “the AEG

Defendants”).    This lawsuit seeks millions of dollars allegedly owed to Creation for the

manufacture of commercial solar inverters under theories of alter ego, breach of the written

Security Agreement, fraud, fraudulent transfer, and negligent misrepresentation.

       An amended petition was filed by Creation on November 5, 2018. AEG Luxembourg,

AEG Power Solutions, and AEG Germany all filed special appearances that argued Creation had

not alleged sufficient contacts or other conduct with Texas to warrant the exercise of personal

jurisdiction. AEG Malaysia and Jeffrey Casper were not named as parties in the amended petition,

and, after the filing of the special appearances, Creation non-suited AEG Luxembourg, leaving

AEG USA, AEG Power Solutions, and AEG Germany.

       Creation’s response to the special appearances argued that AEG Germany was subject to

specific jurisdiction in Texas because it had purposefully availed itself of conducting activities in

                                                –5–
Texas, and that AEG Power Solutions was subject to both general and specific jurisdiction in

Texas. After holding a hearing on both special appearances and listening to the arguments of

counsel, the trial court signed separate orders granting AEG Power Solution’s special appearance

and denying AEG Germany’s special appearance. This accelerated interlocutory appeal concerns

the special appearance brought by AEG Germany.

                                     PERSONAL JURISDICTION

       Texas courts may exercise personal jurisdiction over a nonresident defendant “when the

state’s long-arm statute authorizes such jurisdiction and its exercise comports with due process.”

Cornerstone Healthcare Grp. Holding, Inc. v. Nautic Mgmt. VI, L.P., 493 S.W.3d 65, 70 (Tex.

2016). The Texas long-arm statute provides in relevant part that “[i]n addition to other acts that

may constitute doing business,” a nonresident does business in Texas if the nonresident contracts

by mail or otherwise with a Texas resident and either party is to perform the contract in whole or

in part in this state, or if the nonresident commits a tort in whole or in part in this state. TEX. CIV.

PRAC. & REM. CODE ANN. § 17.042(1), (2). The statute “provides for personal jurisdiction that

extends to the limits of the United States Constitution, and so federal due process requirements

shape the contours of Texas courts’ jurisdictional reach.” Searcy v. Parex Res., Inc., 496 S.W.3d
58, 66 (Tex. 2016).

       “[W]hether a trial court’s exercise of jurisdiction is consistent with due process

requirements turns on two requirements: (1) the defendant must have established minimum

contacts with the forum state; and (2) the assertion of jurisdiction cannot offend traditional notions

of fair play and substantial justice.” Id. (citing Int’l Shoe Co. v. Washington, 326 U.S. 310, 316

(1945)). “[S]ufficient minimum contacts exist when the nonresident defendant ‘purposefully

avails itself of the privilege of conducting activities within the forum [s]tate, thus invoking the

benefits and protections of its laws.’” Id. at 66–67 (quoting Hanson v. Denckla, 357 U.S. 235, 253

                                                 –6–
(1958)). “The nub of the purposeful availment analysis is whether a nonresident defendant’s

conduct in and connection with Texas are such that it could reasonably anticipate being haled into

court here.” Id. at 67. The defendant must purposefully direct contacts into the forum state. Id.

(citing Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223,

228 (Tex. 1991)).

       When determining whether a nonresident purposefully availed itself of the privilege of

conducting activities in Texas, we consider three factors: (1) only the defendant’s contacts with

the forum are relevant, not the unilateral activity of another party or third person; (2) the contacts

relied upon must be purposeful rather than random, isolated, or fortuitous; and (3) the defendant

must seek some benefit, advantage, or profit by availing itself of the jurisdiction. Cornerstone,
493 S.W.3d at 70–71. This analysis assesses the quality and nature of the contacts, not the quantity.

Moncrief Oil Int’l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 151 (Tex. 2013). A defendant will not

be haled into a jurisdiction based solely on contacts that are random, isolated, or fortuitous, or on

the unilateral activity of another party or a third person. Michiana Easy Livin’ Country, Inc. v.

Holten, 168 S.W.3d 777, 785 (Tex. 2005); Guardian Royal Exch., 815 S.W.2d at 226.

       In addition to minimum contacts, due process requires the exercise of personal jurisdiction

to comply with traditional notions of fair play and substantial justice. Moncrief Oil Int’l, 414
S.W.3d at 154 (citing Retamco Operating, Inc. v. Republic Drilling Co., 278 S.W.3d 333, 338

(Tex. 2009)). The evaluation is undertaken in light of these factors, when appropriate:

       (1) the burden on the defendant; (2) the interests of the forum state in adjudicating
       the dispute; (3) the plaintiff’s interest in obtaining convenient and effective relief;
       (4) the interstate or international judicial system’s interest in obtaining the most
       efficient resolution of controversies; and (5) the shared interest of the several
       nations or states in furthering fundamental substantive social policies.

Spir Star AG v. Kimich, 310 S.W.3d 868, 878 (Tex. 2010).

       The plaintiff bears the initial burden of pleading allegations that suffice to permit a court’s

                                                 –7–
exercise of personal jurisdiction over the nonresident defendant. Searcy, 496 S.W.3d at 66. Once

the plaintiff has met this burden, the defendant then assumes the burden of negating all potential

bases for personal jurisdiction that exist in the plaintiff’s pleadings. Id. The defendant can negate

jurisdiction on either a factual or legal basis. Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653,

659 (Tex. 2010). A defendant negates jurisdiction on a factual basis by presenting evidence to

disprove the plaintiff’s jurisdictional allegations. Id. “The plaintiff can then respond with its own

evidence that affirms its allegations, and it risks dismissal of its lawsuit if it cannot present the trial

court with evidence establishing personal jurisdiction.” Id. (footnotes omitted). A defendant

negates jurisdiction on a legal basis by showing that “even if the plaintiff’s alleged facts are true,

the evidence is legally insufficient to establish jurisdiction; the defendant’s contacts with Texas

fall short of purposeful availment; for specific jurisdiction, that the claims do not arise from the

contacts; or that traditional notions of fair play and substantial justice are offended by the exercise

of jurisdiction.” Id. A defendant’s contacts with a forum may give rise to either general or specific

jurisdiction. KC Smash 01, LLC v. Gerdes, Hendrichson, Ltd., L.L.P., 384 S.W.3d 389, 392 (Tex.

App.—Dallas 2012, no pet.).

        Creation does not argue that general jurisdiction is available over AEG Germany. Our

inquiry is therefore confined to specific jurisdiction, which is based on “whether the defendant’s

activities in the forum state themselves ‘give rise to the liabilities sued on.’” Searcy, 496 S.W.3d

at 67 (quoting Int’l Shoe, 326 U.S. at 317). Specific jurisdiction exists when the plaintiff’s claims

“arise out of” or are “related to” the defendant’s contacts with the forum. Id. (citing Helicopteros

Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 8, 9 (1984)). “[T]he defendant’s

relationship, not the plaintiff’s relationship, with the forum state is the proper focus of the specific

jurisdiction analysis; that is, courts must consider the relationship between the defendant, the

forum state, and the litigation.” Id.

                                                   –8–
       “‘[F]or a nonresident defendant’s forum contacts to support an exercise of specific

jurisdiction, there must be a substantial connection between those contacts and the operative facts

of the litigation.’” Moncrief Oil Int’l, 414 S.W.3d at 156 (quoting Moki Mac River Expeditions v.

Drugg, 221 S.W.3d 569, 585 (Tex. 2007)). “[B]ut-for causation alone is insufficient.” Id. at 157;

see also Leonard v. Salinas Concrete, LP, 470 S.W.3d 178, 188 (Tex. App.—Dallas 2015, no pet.).

“‘The operative facts are those on which the trial will focus to prove the liability of the defendant

who is challenging jurisdiction.’” Leonard, 470 S.W.3d at 188 (quoting Kaye/Bassman Int’l Corp.

v. Dhanuka, 418 S.W.3d 352, 357 (Tex. App.—Dallas 2013, no pet.)). “[S]pecific jurisdiction

requires us to analyze the jurisdictional contacts on a claim-by-claim basis.” Moncrief Oil Int’l,
414 S.W.3d at 150.

                                      STANDARD OF REVIEW

       The question of whether a court has personal jurisdiction over a nonresident defendant is a

question of law we review de novo. Moncrief Oil Int’l, 414 S.W.3d at 150 (citing Moki Mac River

Expeditions, 221 S.W.3d at 574). “When, as here, the trial court does not issue findings of fact

and conclusions of law, we imply all relevant facts necessary to support the judgment that are

supported by evidence.” Id. (citing Retamco Operating, Inc., 278 S.W.3d at 337).

                                            DISCUSSION

       In its sole issue on appeal, AEG Germany argues the trial court could not exercise personal

jurisdiction over it because AEG Germany had negligible contacts with Texas, none of which give

rise to Creation’s claims, and that the court therefore erred in denying AEG Germany’s special

appearance.

       Creation’s argument for specific jurisdiction over AEG Germany is that AEG Germany

was the improper recipient of goods fraudulently transferred to it by AEG USA, thus creating

specific jurisdiction. Creation argues that AEG Germany had sufficient minimum contacts with

                                                –9–
Texas because it purposefully and actively intended to defraud Creation, a Texas company, by

intentionally violating the Texas Uniform Fraudulent Transfer Act (“TUFTA”), and by taking

possession of assets it knew Creation had a valid security interest in. See, e.g., Challenger Gaming

Solutions, Inc. v. Earp, 402 S.W.3d 290, 295 (Tex. App.—Dallas 2013, no pet) (fraudulent transfer

under TUFTA is a tort). But according to AEG Germany, this argument fails because (1) AEG

Germany negated Creation’s jurisdictional facts and shifted the burden back to Creation by

offering evidence no transfer occurred; and (2) receiving fraudulently transferred goods does not

create jurisdiction as a matter of law.

       Creation directs our attention to a December 29, 2013 email Jeffrey Casper sent to John

Taylor, vice president of sales with AEG Power Solutions, and to Roger de Vries, vice president

of reporting and control. In that email, titled “RE: Japan Office––strictly confidential between

YOU and ME,” Casper wrote:

       So we have an inventory commitment of 5m USD to support this activity that I
       want to get out of . . . .

       . . . . In the meantime, we will transfer the MPV to Belecke. We will reduce Dallas
       to 3 people and by end of March be done with it. Agreed. We will dispute what is
       left with supplier and, if necessary bankrupt the thing. If you agree let me know.
       If you don’t, and don’t want to take on this added issue also tell me. But I do need
       to decide on Japan.

Creation interprets this email as Casper proposing to sell the inventory elsewhere while

simultaneously (1) transferring the solar inverter work (referred to in the email as MPV) to

Warstein-Belecke, Germany, where AEG Germany is headquartered; (2) reducing the Dallas

office to three people; (3) disputing the remaining inventory with Creation; and (4) bankrupting

AEG USA if necessary.

       Creation also cites a passage from AEG Power Solution’s 2014 annual report that allegedly

described the shuttering of AEG USA. The report explained to shareholders that “[t]he existing

products and activities were subsequently transferred to the Group’s German subsidiary and the

                                               –10–
office closed at the end of April 2014. The Group maintains a sales and support presence in the

United States.” In a letter to stakeholders that was part of the same annual report, Jeffrey Casper

stated that “the Company initiated plans to close down its R&D and sales office in Richardson,

Texas, USA,” and that “[t]his entity consistently operated at a loss and continued to consume

cash.” It also stated that “[a]fter existing products and activities were transferred to our German

subsidiary, the U.S. office ceased activity at the end of April 2014.” According to Creation, this

confirmed the closing of AEG USA and the transfer of its assets to AEG Germany, in violation of

the Security Agreement. Moreover, Casper was serving as the director of AEG Germany when

AEG USA was shut down and its assets allegedly transferred to AEG Germany. As Creation

argues, “Casper wheeled and dealed on behalf of whichever AEG entity benefitted AEG’s bottom

line, in this case AEG Germany, without regard to corporate formalities and with knowledge that

his actions on behalf of AEG was done with the intent to not honor the agreements AEG USA had

entered into.”

       AEG Germany, however, responds that the above reference to the transfer of assets to

Germany is a “misstatement,” and it directs our attention to the portion of Casper’s January 31,

2019 declaration that states: “Creation has not identified the assets it claims were improperly

transferred by [AEG] USA to AEG Germany. I am not aware of any assets being improperly

transferred from [AEG] USA to AEG Germany. Furthermore, Creation has not taken a judgment

against [AEG] USA.” AEG Germany contends that Creation has not rebutted this evidence,

having failed to identify any improperly transferred assets in its discovery responses or filings, and

that there is no competent evidence in this record showing an actual transfer of assets occurred.

As for the email, AEG Germany calls it a “red herring” because what Casper “suggested” in the

email, i.e., putting AEG USA into bankruptcy and transferring its assets to “Belecke,” never

happened.

                                                –11–
       As part of its argument, Creation also cites to three decisions from federal courts,

contending that under the “effects test” of Calder v. Jones, 465 U.S. 783 (1984), jurisdiction is

proper over AEG Germany because of its alleged receipt of AEG USA’s fraudulently transferred

assets. See Mullins v. TestAmerica, Inc., 564 F.3d 386 (5th Cir. 2009); Dontos v. Vendomation NZ

Ltd., 582 Fed.Appx. 338 (5th Cir. 2014); Sourcing Mgmt., Inc. v. Simclar, Inc., 118 F. Supp. 3d 899

(N.D. Tex. 2015). But this reliance is misplaced. In fact, all three cases are not only factually

dissimilar to this case, but they show that the alleged contacts in this instance do not rise to the

level of purposeful availment.

       In Mullins, a Texas creditor sued a debtor and related parties who had subsequently

received funds alleged to have been transferred fraudulently in violation of TUFTA. Mullins, 564
F.3d at 398. The Fifth Circuit upheld the district court’s exercise of personal jurisdiction over

defendants who had no contacts with the forum state of Texas apart from their alleged involvement

in a fraudulent transfer scheme, concluding they had “purposefully aimed their conduct at . . .

Texas . . . with the knowledge that their conduct would allegedly impair the rights of a single,

major creditor and Texas resident under agreements that center around Texas.” Id.

       The Fifth Circuit reached this conclusion based on the “effects” test, which, as described

by the Fifth Circuit, provides that “‘an act done outside the state that has consequences or effects

within the state will suffice as a basis for jurisdiction in a suit arising from those consequences if

the effects are seriously harmful and were intended or highly likely to follow from the nonresident

defendant’s conduct.’” Mullins, 564 F.3d at 400 (quoting Guidry v. U.S. Tobacco Co., 188 F.3d
619, 628 (5th Cir. 1999)). The Fifth Circuit noted that “the ‘effects’ test in Calder does not

supplant the need to demonstrate minimum contacts that constitute purposeful availment, that is,

conduct by the non-resident defendant that invoked the benefits and protections of the state or was

otherwise purposefully directed toward a state resident.” Id. at 400. Moreover, “[k]nowingly

                                                –12–
accepting a fraudulent transfer may subject a transferee to liability, but such conduct is not

necessarily tantamount to committing a wrongful act purposefully aimed at a creditor of the

transferor in his state of residence.” Id. at 400–01. The court expressed doubt that Calder

established personal jurisdiction “over the recipient of a fraudulent transfer anywhere a

complaining creditor files suit simply by virtue of the creditor’s residence in that forum.” Id. at

401.

       However, the Fifth Circuit concluded there was personal jurisdiction over the defendants

because the Texas-based plaintiff/creditor, Faraway, had been targeted and singled out by the

defendants, Sagaponack (a partnership in which none of the partners was a Texas citizen) and

Weisman (also not a citizen of Texas), and that the defendants intended to block any sale that

included a distribution of assets to that specific creditor. See id. at 401–02. As the court pointed

out, “the evidence in this case demonstrates both that Faraway was no ordinary creditor . . . and

Sagaponack was far from a passive transferee.” Id. at 401. Moreover, the note and purchase

agreement were expressly governed by Texas law and the debtor-creditor relationship was

centered in Texas. Id. at 402. The court concluded:

       . . . Sagaponack purposefully aimed its conduct at Faraway in Texas by ensuring
       that a portion of its own notes would be paid while knowing that Faraway’s would
       not. It is therefore no “mere fortuity” that Sagaponack’s conduct would cause
       injury to Faraway in Texas. Under these circumstances, we find that Sagaponack
       should reasonably have anticipated being haled into a Texas court for precipitating
       and directing an alleged fraudulent transfer at the expense of a known, major
       creditor in Texas whose right to payment arises out of contracts that share a strong
       connection with Texas.

Id. (citation omitted).     The court likewise concluded that “Weisman’s alleged conduct in

engineering a transfer that knowingly impaired the rights of a Texas resident under agreements

centered in Texas substantiates that he purposefully aimed his intentionally tortious conduct at the

forum state.” Id. at 403.

       Two other “effects test” cases cited by Creation, Dontos and Sourcing Management, are
                                               –13–
no more helpful to its position. In Dontos, an unpublished opinion, the Fifth Circuit held that

personal jurisdiction over out-of-state defendants was present where a Texas creditor/plaintiff

alleged that the defendants participated in a scheme to fraudulently transfer assets to prevent the

creditor/plaintiff from collecting a pre-exiting Texas judgment, in violation of TUFTA. Dontos,

582 Fed.Appx. at 345–48. In explaining its conclusion that there was personal jurisdiction over

the defendants, the court stated that “[a]s the Texas Supreme Court has explained, when a

nonresident defendant receives Texas property or a Texas contract, for the purpose of defrauding

a Texas resident, the nonresident defendant is subject to suit in Texas courts.” Id. at 347 (citing

Retamco Operating, Inc. v. Republic Drilling Co., 278 S.W.3d 333, 341 (Tex. 2009)). Similarly,

in Sourcing Management, which involved a Texas creditor attempting to collect on its Texas

judgment, the court concluded, citing Mullins, Dontos, and Retamco, that the plaintiff “made a

prima facie showing that [the defendant] established minimum contacts with Texas sufficient for

this court to exercise specific jurisdiction over [the defendant]” when the defendant “intentionally

impaired [the plaintiffs’] ability to collect on its Texas judgment . . . by colluding to transfer

[another defendants’] assets via a private foreclosure sale.” Sourcing Mgmt., 118 F. Supp. 3d at

910–11.

       The Texas Supreme Court has likewise concluded that “the ‘effects test’ is not an

alternative to our traditional ‘minimum contacts’ analysis, and it does not displace the factors we

look to in determining whether a defendant purposefully availed itself of the state.” Old Republic

Nat’l Title Ins. Co. v. Bell, 549 S.W.3d 550, 565 (Tex. 2018) (concluding that even if the

defendant’s receipt of funds was “part of an elaborate fraudulent-transfer scheme, her contacts do

not establish purposeful availment of the state of Texas” because “she transferred a fungible

asset—money—with no continuing presence in Texas, and the mere act of accepting the transfer

of money drawn on a Texas bank is ‘of negligible significance for purposes of determining whether

                                               –14–
[a foreign defendant] had sufficient contacts in Texas.’”) (quoting Helicopteros, 466 U.S. at 416–

17). The court also stated “that the test laid out in Calder requires that the ‘effects’ of the alleged

tort must connect the defendant to the forum state itself, not just to a plaintiff who lives there.” Id.

at 564 (citing Walden v. Fiore, 571 U.S. 277, 288 (2014)). “Moreover, we have explicitly rejected

an approach to specific jurisdiction that turns upon where a defendant ‘directed a tort’ rather than

on the defendant’s contacts.” Id. at 565.

       In this case, AEG Germany was not a party to the Manufacturing Agreement or the Security

Agreement; it was not involved in the “order process” with Power Max and AEG USA; nor was it

a party to AEG USA’s lawsuit against Power Max. In fact, Creation has not alleged any contacts

by AEG Germany with the state of Texas that “give rise” to Creation’s claims against it, apart

from the allegation that AEG Germany was the recipient of fraudulently transferred assets. Yet

Creation has not even shown that a transfer of assets to AEG Germany occurred (obviously

necessary for a fraudulent transfer claim), much less that it was fraudulent, or, in fact, what was

actually transferred. Moreover, as the above cases show, even if we assume a tort was somehow

committed and that AEG Germany knew its actions would cause an injury in Texas (assumptions

this record does not support), the alleged contacts do not rise to the level of purposeful availment

simply because Creation is a Texas company or the alleged harm occurred in Texas. See, e.g., Old

Republic Nat’l Title Ins. Co., 549 S.W.3d at 565.

       We decide AEG Germany’s issue in its favor. We reverse the trial court’s order and render

judgment dismissing Creation’s claims against AEG Germany for lack of jurisdiction.

                                                     /Lana Myers/
                                                     LANA MYERS
                                                     JUSTICE

190195F.P05
                                                 –15–
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                      JUDGMENT

 AEG POWER SOLUTIONS GMBH,                          On Appeal from the 14th Judicial District
 Appellant                                          Court, Dallas County, Texas
                                                    Trial Court Cause No. DC-18-15065.
 No. 05-19-00195-CV         V.                      Opinion delivered by Justice Myers.
                                                    Justices Osborne and Nowell participating.
 CREATION TECHNOLOGIES TEXAS,
 LLC, Appellee

       In accordance with this Court’s opinion of this date, the judgment of the trial court is
REVERSED and judgment is RENDERED dismissing CREATION TECHNOLOGIES, LLC’S
claims against AEG POWER SOLUTIONS GMBH for lack of jurisdiction. It is ORDERED that
appellant AEG POWER SOLUTIONS GMBH recover its costs of this appeal from appellee
CREATION TECHNOLOGIES, LLC.

Judgment entered this 12th day of November, 2019.

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