Court Opinion

ID: 4857667
Source: CourtListenerOpinion
Date Created: 2021-08-25 06:25:05.422189+00
Date Added: 2024-06-11T08:11:53.874540
License: Public Domain

Affirm and Opinion Filed August 20, 2021

                                        In The
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                No. 05-19-00274-CV

      STEWARD HEALTH CARE SYSTEM LLC AND SOUTHWEST
              GENERAL HOSPITAL, LP, Appellants
                           V.
                  FRANK SAIDARA, Appellee

                On Appeal from the 193rd Judicial District Court
                             Dallas County, Texas
                     Trial Court Cause No. DC-18-16862

                                    OPINION
                          Before the Court sitting En Banc
                             Opinion by Justice Myers
      Steward Health Care System LLC and Southwest General Hospital, LP bring

an interlocutory appeal of the trial court’s order granting the special appearance filed

by Frank Saidara and dismissing appellants’ causes of action against him.

Appellants bring one issue contending the trial court erred by granting Saidara’s

special appearance because Saidara committed tortious acts in Texas. We affirm the

trial court’s order granting Saidara’s special appearance.
                I. FACTUAL AND PROCEDURAL BACKGROUND1

         Steward Health is a Dallas-based health care system. It owns numerous

hospitals, including Southwest General, located in San Antonio, Texas.

         Saidara resides in California, and he is the vice president of corporate holdings

for Prospect Medical Holdings, Inc., which has its principal place of business in Los

Angeles, California.

         In 2018, Prospect Medical approached Steward Health about acquiring the

assets of Southwest General.                To facilitate Prospect Medical’s due diligence,

Steward Health set up a virtual data room where documents relevant to the proposed

transaction were uploaded. A subset of the data was placed into a more restrictive

“virtual clean room.” Prospect Medical tasked Saidara as well as other officers and

high-level employees with conducting negotiations and performing due diligence

related to the transaction. The individuals with access to the virtual clean room (the

clean team), included Saidara. The members of the clean team were required to sign

a clean team agreement that limited their disclosure of information, authorized them

to prepare “evaluative analyses and aggregated summaries” of the sensitive materials

for their individual use in evaluating the proposed transaction, prohibited

unauthorized sharing or dissemination of the materials in the virtual clean room as

well as any documents created that incorporated or used that sensitive information,

   1
       Except as otherwise stated, these facts come from the parties’ pleadings.

                                                    –2–
and restricted use of the sensitive information to the purposes permitted by a separate

confidentiality agreement signed by Steward Health and Prospect Medical.2

        Saidara accessed information online in the virtual data room and clean room.

He also participated in electronic and telephonic communications with Steward

Health and Southwest General relating to the potential transaction. On at least one

occasion, Saidara traveled to Texas, toured the Southwest General facility with

James Summerset, the interim chief executive officer of Prospect Health. Appellants

alleged that while Saidara and Summerset visited Southwest General, “Summerset

asked an unusual amount of questions about proprietary Southwest General data.

Specifically, Summerset inquired about physician employment arrangements and

compensation data.” On September 15, 2018, after the visit to Southwest General,

Saidara allegedly downloaded all the information from the virtual clean room.

        On September 20, 2018, five days after Saidara had downloaded the data,

Prospect Medical informed Steward Health that it was no longer interested in

acquiring the assets of Southwest General. Appellants alleged that persons within

Prospect Medical and Prospect Health later leaked information relating to the

    2
      The confidentiality agreement included a forum-selection clause: “In the event a dispute arises
concerning any of the provisions of this Agreement, it shall be submitted to and decided by the Courts of
the Commonwealth of Massachusetts.” The record does not show that any party has filed a motion to
transfer the case to the Massachusetts courts. Neither Saidara nor appellants raised the forum-selection
clause in the special appearance or response to the special appearance. Accordingly, we do not discuss its
applicability to this case.
                                                  –3–
proposed transaction, which made it more difficult for Southwest General to market

and sell its assets.

        On November 7, 2018, appellants filed their original petition against Prospect

Medical, Prospect Health, and Saidara. In their first amended petition, appellants

alleged claims for: (1) common law fraud, (2) unfair competition,3 (3)

misappropriation of trade secrets in violation of the Texas Uniform Trade Secrets

Act, (4) violation of the Texas Harmful Access by Computer Act, and (5) conspiracy

to misappropriate appellants’ trade-secret information. Appellants claimed that

personal jurisdiction existed as to Saidara because he had contacts with Texas with

respect to the complained-of acts.

        Saidara filed a special appearance arguing the trial court lacked personal

jurisdiction over him because: (1) there is no basis for general jurisdiction; and (2)

the trial court cannot exercise specific jurisdiction because (a) the alleged activities

supporting the claims against him occurred while he was in California acting in the

course of his employment with Prospect Medical, (b) all his alleged wrongful acts

    3
       Appellants do not specify the branch of “unfair competition” they allege. See, e.g., James E. Hudson,
III, A Survey of the Texas Unfair-Competition Tort of Common-Law Misappropriation, 50 BAYLOR L. REV.
921, 924–26 (1989) (noting Texas common law recognizes three branches of unfair competition: palming
off, trade-secret misappropriation, and common-law misappropriation); RESTATEMENT (THIRD) OF UNFAIR
COMPETITION § 40 cmt. a (AM. LAW INST. 1995) (stating that unfair competition includes torts for
misappropriation, infringement, unjust enrichment, and breach of confidence, but not breach of contract,
breach of the duty of loyalty owed by an employee or other agent, or breach of confidence not involving a
trade secret). Rather, they generally refer to their claim as “Unfair Competition” and contend that “by
misleading Steward with their misrepresentations that Prospect intended to buy the assets of Southwest
General and thereby inducing Steward to make Southwest General’s most sensitive business information
available to Prospect senior executives and ultimately all of Prospect, Prospect and Saidara have engaged
in conduct that is contrary to honest practices in commercial matters.”
                                                   –4–
were in connection with his employment so he is protected by the fiduciary-shield

doctrine, and (c) “[appellants] have failed to plead any purposeful (wrongful)

activities by Saidara originating in Texas.”

        Saidara attached his declaration to his special appearance. He stated in the

declaration that he is a citizen of California and resides in Los Angeles. All his

actions in relation to the proposed transaction between Prospect and appellants were

in his capacity as Prospect’s vice president of corporate development. In the

confidentiality agreement, he was designated a member of the clean team with

access to the information in the virtual clean room. He made one trip to Texas

visiting San Antonio in connection with the proposed transaction. He was in

California at the time appellants alleged he inappropriately downloaded confidential

information or trade secrets. He accessed the information in the clean room for

legitimate purposes related to Prospect’s due diligence in the proposed transaction.

        Appellants responded that the trial court had specific jurisdiction over Saidara

but did not attach any evidence to support their allegations.4 The trial court signed

an order granting Saidara’s special appearance and dismissing the claims against

him. In that order, the trial court concluded that “there is no record evidence that

    4
      The parties’ briefs as well as the trial court’s order and docket sheet indicate that a hearing was held
on Saidara’s special appearance. However, the record on appeal does not contain a reporter’s record.
Nevertheless, the parties do not contend that it was an evidentiary hearing. See Michiana Easy Livin’
Country, Inc. v. Holten, 168 S.W.3d 777, 783–84 (Tex. 2005) (declining to presume the special appearance
hearing was evidentiary when the parties conceded that it was not).
                                                    –5–
would support the exercise of general jurisdiction over” Saidara and there was no

specific jurisdiction.5 This interlocutory appeal followed.

                          II. SAIDARA’S SPECIAL APPEARANCE
          Appellants raise one issue on appeal contending the trial court erred when it

granted Saidara’s special appearance.6 They argue the trial court has specific

jurisdiction over Saidara because: (1) the Texas long-arm statute extends to

Saidara’s contacts; (2) Saidara had sufficient minimum contacts with Texas; (3)

Saidara cannot show the exercise of specific jurisdiction would impose an

unreasonable burden on him; and (4) the fiduciary-shield doctrine does not protect

Saidara from specific jurisdiction. Saidara responds that the trial court properly

concluded it lacked personal jurisdiction over him because his contacts with Texas

were insufficient to confer specific jurisdiction; and, even if he had sufficient

minimum contacts with Texas, the exercise of personal jurisdiction over him does

not comport with traditional notions of fair play and substantial justice.7

    5
        With respect to specific jurisdiction, the trial court stated:
          The Court also finds that Defendant Frank Saidara has not purposefully directed any
          business activities toward Texas, nor has he engaged in any activities that would support
          the exercise of specific jurisdiction. The Court also finds that the exercise of personal
          jurisdiction over Defendant Frank Saidara would not comport with traditional notions of
          fair play and substantial justice.
    6
      Appellants do not challenge the portion of the trial court’s order that concludes there was no evidence
to support the exercise of general jurisdiction over Saidara.
    7
      Because we conclude appellants failed to meet their burden of pleading sufficient allegations to bring
Saidara within the provisions of the Texas long-arm statute, we need not discuss whether the
fiduciary-shield doctrine applies or whether the exercise of specific jurisdiction over Saidara would impose
an unreasonable burden on him.
                                                        –6–
                                  A. Standard of Review

      Whether a trial court has personal jurisdiction over a nonresident defendant is

a question of law that appellate courts review de novo. E.g., Old Republic Nat’l Title

Ins. Co. v. Bell, 549 S.W.3d 550, 558 (Tex. 2018). When a trial court does not issue

findings of fact and conclusions of law with its special appearance ruling, all facts

necessary to support the judgment and supported by the evidence are implied. Id.

When the appellate record includes the reporter’s and clerk’s records, these implied

findings are not conclusive and may be challenged for legal and factual sufficiency

in the appropriate appellate court. BMC Software Belg., N.V. v. Marchand, 83

S.W.3d 789, 795 (Tex. 2002). When the relevant facts in a case are undisputed, an

appellate court need not consider any implied findings of fact and considers only the

legal question of whether the undisputed facts establish Texas jurisdiction. Old

Republic, 549 S.W.3d at 558.

                   B. Burdens of the Parties in a Special Appearance

      The plaintiff bears the initial burden of pleading sufficient allegations to bring

a nonresident defendant within the provisions of the Texas long-arm statute. E.g.,

Old Republic, 549 S.W.3d at 559; Moncrief, 414 S.W.3d at 149. In order to meet its

burden, a plaintiff must show the act on which jurisdiction is predicated, not a prima

facie demonstration of the existence of a cause of action. Bruno’s Inc. v. Arty

Imports, Inc., 119 S.W.3d 893, 896–97 (Tex. App.—Dallas 2003, no pet.); Clark v.

Noyes, 871 S.W.2d 508, 511 (Tex. App.—Dallas 1994, no pet.) (although Texas

                                         –7–
courts use federal due process standard for analyzing minimum contacts, they do not

use federal procedural rules, which would incorrectly place burden to show

sufficient minimum contacts on the party seeking to invoke jurisdiction). This

minimal pleading requirement is satisfied by an allegation that the nonresident

defendant is doing business in Texas or committed tortious acts in Texas. Alencar

v. Shaw, 323 S.W.3d 548, 553 (Tex. App.—Dallas 2010, no pet.). If the plaintiff

does not meet this burden, the defendant need only prove that it does not reside in

Texas to negate jurisdiction. See Siskind v. Villa Found. for Educ., Inc., 642 S.W.2d

434, 438 (Tex. 1982); Jani-King Franchising, Inc. v. Falco Franchising, S.A., No.

05-15-00335-CV, 2016 WL 2609314, at *4, (Tex. App.—Dallas May 5, 2016, no

pet.) (mem. op.).

      Specific jurisdiction is established when the nonresident defendant’s alleged

liability arises from or is related to activity conducted within the forum. Moki Mac

River Expeditions v. Drugg, 221 S.W.3d 569, 576 (Tex. 2007); accord Bristol-Myers

Squibb Co. v. Superior Court of Cal., 137 S. Ct. 1773, 1780 (2017). The “arises

from or relates to” requirement lies at the heart of specific jurisdiction by defining

the required nexus between the nonresident defendant, the litigation, and the forum

state. Moki Mac, 221 S.W.3d at 579. In order for a nonresident defendant’s contacts

in a forum state to support an exercise of specific jurisdiction, there must be a

substantial connection between those contacts and the operative facts of the

litigation. Id. at 585; accord Walden v. Fiore, 571 U.S. 277, 284 (2014). The

                                         –8–
operative facts of the litigation are those facts the trial court will focus on to prove

the nonresident defendant’s liability. See Jani-King, 2016 WL 2609314, at *5.

                                   III. ANALYSIS
      Saidara asserted in his special appearance that appellants failed to meet their

burden of pleading sufficient allegations to invoke jurisdiction under the Texas long-

arm statute. To decide this issue, we must decide what documents may be examined

to determine whether appellants met this burden. Appellants argue that the court

looks to the pleadings and the plaintiff’s response to the defendant’s special

appearance to determine whether the plaintiff has met this burden. Appellants

included factual allegations in their response to the special appearance that were not

in either their original or amended petitions. Appellants did not attach any evidence

to their response to the special appearance.

                                          –9–
        Several of this Court’s opinions,8 as well as opinions from most of the other

intermediate courts of appeals,9 state that courts may consider facts alleged in a

response to a special appearance as well as the plaintiff’s petition to determine if the

    8
       See B.G.C. v. M.Y.R., No. 05-20-00318-CV, 2020 WL 5987913, at *2 (Tex. App.—Dallas Oct. 9,
2020, pet. denied) (mem. op.); Invasix, Inc. v. James, No. 05-19-00494-CV, 2020 WL 897243, at *4 (Tex.
App.—Dallas Feb. 25, 2020, no pet.) (mem. op.); Golden Peanut Co. v. Give & Go Prepared Foods Corp.,
No. 05-18-00626-CV, 2019 WL 2098473, at *4 (Tex. App.—Dallas May 14, 2019, no pet.) (mem. op.);
Cooper Gay Martinez del Rio y Asociados Intermediarios de Reaseguro S.A. de C.V. v. Elamex, S.A. de
C.V., No. 05-16-01436-CV, 2017 WL 3599690, at *5 (Tex. App.—Dallas Aug. 22, 2017, no pet.) (mem.
op.); Seguros Afirme, S.A. de C.V. v. Elamex, S.A. de C.V., No. 05-16-01465-CV, 2017 WL 3599693, at *5
(Tex. App.—Dallas Aug. 22, 2017, no pet.) (mem. op.); N. Frac Proppants, II, LLC v. 2011 NF Holdings,
LLC, No. 05-16-00319-CV, 2017 WL 3275896, at *2, 5 (Tex. App.—Dallas July 27, 2017, no pet.) (mem.
op.); Jani-King, 2016 WL 2609314, at *4; Nat’l Fire Ins. Co of Hartford v. CE Design, Ltd., 429 S.W.3d
806, 811 & n.6 (Tex. App.—Dallas 2014, no pet.) (noting Court unpersuaded by appellees’ assertion that
appellants failed to plead jurisdictional facts and stating that, in addition to facts alleged in their original
petition for declaratory relief, appellants set out their factual allegations in support of jurisdiction in their
opposition and supplemental opposition to appellees’ special appearance and motion to dismiss); Stull v.
LaPlant, 411 S.W.3d 129, 134 (Tex. App.—Dallas 2013, no pet.); NexBank, SSB v. Countrywide Fin.
Corp., No. 05-12-00567-CV, 2013 WL 2244830, at *2 (Tex. App.—Dallas May 22, 2013, no pet.) (mem.
op.); Camac v. Dontos, 390 S.W.3d 398, 405 (Tex. App.—Dallas 2012, no pet.); Crithfield v. Boothe, 343
S.W.3d 274, 282 (Tex. App.—Dallas 2011, no pet.); All. Royalties, LLC v. Boothe, 329 S.W.3d 117, 120–
21 (Tex. App.—Dallas 2010, no pet.); Wilkert v. Year One, Inc., 320 S.W.3d 522, 524 (Tex. App.—Dallas
2010, no pet.); Alencar v. Shaw, 323 S.W.3d 548, 552 (Tex. App.—Dallas 2010, no pet.); Ahrens &
deAngeli, P.L.L.C. v. Flinn, 318 S.W.3d 474, 478 (Tex. App.—Dallas 2010, pet. denied); Proctor v. Buell,
293 S.W.3d 924, 930–31 (Tex. App.—Dallas 2009, no pet.); Flanagan v. Royal Body Care, Inc., 232
S.W.3d 369, 374 (Tex. App.—Dallas 2007, pet. denied).
    9
       See, e.g., Patel v. Pate, No. 02-16-00313-CV, 2017 WL 2871684, at *3 n.4 (Tex. App.—Fort Worth
July 6, 2017, no pet.) (mem. op.) (“Courts may consider jurisdictional grounds alleged in responses to
special appearances as well as the plaintiff’s petition.”); Sembcorp Marine Ltd. v. Carnes, No. 09-15-00430-
CV, 2016 WL 3019552, at *2 (Tex. App.—Beaumont May 26, 2016, no pet.) (mem. op.) (“When evaluating
the plaintiff’s allegations, we consider the pleadings and Carnes’s responses to appellants’ special
appearances.”); Mi Gwang Contact Lens Co., No. 13-13-00306-CV, 2015 WL 3637846, at *3 n.2 (Tex.
App.—Corpus Christi–Edinburg June 11, 2015) (mem. op.) (“The trial court may properly consider
additional allegations contained in a response to a special appearance.”); Accelerated Wealth, LLC v. Lead
Generation & Mktg., LLC, No. 04-12-00647-CV, 2013 WL 1148923, at *2 (Tex. App.—San Antonio Mar.
20, 2013, no pet.) (mem. op.) (same); Hale v. Richey, No. 10-11-00187-CV, 2012 WL 89920, at *4 (Tex.
App.—Waco Jan. 11, 2012, no pet.) (mem. op.) (plaintiff’s petition and response are considered in
determining whether plaintiff met burden of pleading sufficient allegations); Max Protetch, Inc. v. Herrin,
340 S.W.3d 878, 883 (Tex. App.—Houston [14th Dist.] 2011, no pet.) (“In determining whether the
plaintiff satisfied its burden, a court may consider the plaintiff’s pleadings as well as its response to the
defendant’s special appearance.”); Ennis v. Loiseau, 164 S.W.3d, 698, 705 (Tex. App.—Austin 2005, no
pet.); Wright v. Sage Eng’g, Inc., 137 S.W.3d 238, 249 n.7 (Tex. App.—Houston [1st Dist.] 2004, pet.
denied) (allegations in petition “either alone or coupled with appellees’ later assertions, offered in support
of their response to Wright’s special appearance” met plaintiff’s burden to plead sufficient jurisdictional
facts).
                                                     –10–
plaintiff pleaded sufficient allegations to invoke jurisdiction under the Texas

long-arm statute. This practice, however, is contrary to both the Rules of Civil

Procedure and precedent from the Texas Supreme Court.

       Texas Rule of Civil Procedure 120a(3) states, “The court shall determine the

special appearance on the basis of the pleadings, any stipulations made by and

between the parties, such affidavits and attachments as may be filed by the parties,

the results of discovery processes, and any oral testimony.” TEX. R. CIV. P. 120a(3).

The text of a response to a special appearance (as opposed to evidentiary attachments

to a response) does not fall into any of these categories. It is not a pleading. See

TEX. R. CIV. P. 45 (“Pleadings in the district and county courts shall (a) be by petition

and answer . . . .”).

       This Court’s earliest opinion following this practice was Flanagan v. Royal

Body Care, Inc., 232 S.W.3d 369, 374 (Tex. App.—Dallas 2007, pet. denied), and

all our subsequent cases following this practice cite Flanagan. Flanagan cited Ennis

v. Loiseau, 164 S.W.3d 698, 705 (Tex. App.—Austin 2005, no pet.). Flanagan, 232

S.W.3d at 374. Ennis cited Wright v. Sage Engineering, Inc., 137 S.W.3d 238, 249

n.7 (Tex. App.—Houston [1st Dist.] 2004, pet. denied). Ennis, 164 S.W.3d at 705.

The court of appeals in Wright assumed that the allegations in the plaintiffs’ petition,

either alone or coupled with the assertions in the plaintiffs’ response to the special

appearance, met plaintiffs’ initial burden to plead sufficient jurisdictional facts.

Wright, 137 S.W.3d at 249 n.7. Wright cited as the basis of this practice El Puerto

                                         –11–
de Liverpool, S.A. de C.V. v. Servi Mundo Llantero S.A. de C.V., 82 S.W.3d 622, 629

(Tex. App.—Corpus Christi–Edinburg 2002, no pet.). In El Puerto, the court of

appeals concluded the plaintiffs’ “pleadings” were sufficient to show jurisdiction in

Texas because they alleged the defendant was “doing business in the State of Texas”

and “committed torts in Texas.” El Puerto, 82 S.W.3d at 629. Nothing in the El

Puerto opinion suggests the trial court or the court of appeals looked to the plaintiffs’

response to the special appearance for the jurisdictional allegations. The word

“response” does not appear in the El Puerto opinion.                             Thus, Wright, Ennis,

Flanagan, and all the cases citing them have no basis for their assertion that the

plaintiff can present jurisdictional allegations in the response to the special

appearance without including them in the petition.10

    10
       Some courts of appeals in opinions predating Wright have followed the practice without citing any
authority in support. See, e.g., Freund v. Watley Enters., Inc., No. 07-99-0517-CV, 2000 WL 674699, at
*7 (Tex. App.—Amarillo May 24, 2000, pet. denied) (not designated for publication) (although petition did
not allege specific acts of defendant in Texas, the response to the special appearance did, and plaintiff’s
“allegations in its response to the special appearance were sufficient to raise the questions we have
discussed”); Bullen v. Dalton, No. 01-98-00598-CV, 1998 WL 767733, at *4 (Tex. App.—Houston [1st
Dist.] Nov. 5, 1998, no pet.) (not designated for publication) (“Appellees raised jurisdictional allegations
in their response to the special appearance motion. Therefore, appellants had the burden to negate all
jurisdictional claims raised by these pleadings . . . .”); Garner v. Furmanite Australia PTY., Ltd., 966 S.W.2d
798, 801 n.1 (Tex. App.—Houston [1st Dist.] 1998, pet. denied) (jurisdictional facts alleged “in the sworn
response to the special appearance”).
    The Corpus Christi–Edinburg court recognized there was a question whether “when determining
whether the plaintiff has met its initial burden to plead sufficient allegations to show jurisdiction in Texas,
do we look only at the third-party plaintiff’s petition, or do we also consider other documents on file, such
as a response to the special appearance?” Frank A Smith Sales, Inc. v. Atlantic Aero, Inc., 31 S.W.3d 742,
746 (Tex. App.—Corpus Christi–Edinburg 2000, no pet.) (internal quotation marks omitted). The court
did not answer the question because even considering the other documents, the appellant “failed to plead
sufficient allegations to show jurisdiction in Texas.” Id.
                                                    –12–
      The supreme court has not approved this practice. In Kelly v. General Interior

Construction, Inc., 301 S.W.3d 653 (Tex. 2010), the supreme court set out the

procedure for the shifting burdens of proof in a special appearance. First, “the

plaintiff bears the initial burden to plead sufficient allegations to bring the

nonresident defendant within the reach of Texas’s long-arm statute.” Id. at 658

(emphasis added). The defendant then “bears the burden to negate all bases of

personal jurisdiction alleged by the plaintiff.” Id. And where is the defendant to

find the allegations it must negate? The supreme court provides the answer: “the

defendant’s corresponding burden to negate jurisdiction is tied to the allegations in

the plaintiff’s pleading.” Id. (emphasis added). If the plaintiff’s petition lacks

sufficient allegations to bring the defendant under the long-arm statute, “the plaintiff

should amend the pleading to include the necessary factual allegations.” Id. at 659.

If the defendant, in its special appearance, presents evidence that disproves the

plaintiff’s jurisdictional allegations, then the plaintiff should present evidence in

support of the petition’s allegations. Id. If the plaintiff’s evidence differs from the

allegations in the petition, “then the plaintiff should amend the petition for

consistency.” Id. at 659 n.6. Thus, according to Kelly, the allegations on which the

plaintiff bases the exercise of jurisdiction over the defendant must be in the petition.

The plaintiff’s response to the special appearance may contain evidence supporting

the petition’s jurisdictional allegations, but that evidence must be consistent with the

allegations in the petition. “[T]he defendant’s . . . burden to negate jurisdiction is

                                         –13–
tied to the allegations in the plaintiff’s pleading”; nothing in the supreme court’s

precedent suggests the defendant must negate jurisdictional allegations appearing

only in the response to the special appearance.

      To be consistent with Kelly, we conclude that the plaintiff must meet its initial

burden on a special appearance by pleading, in its petition, sufficient allegations to

invoke jurisdiction under the Texas long-arm statute. This Court’s opinions to the

contrary are overruled to the extent they conflict with this conclusion.

      We now consider whether appellants met their burden of pleading sufficient

allegations to bring Saidara within the provisions of the Texas long-arm statute. A

plaintiff’s petition satisfies the long-arm statute when it alleges the defendant did

business, which includes committing a tort in whole or in part in Texas. See CIV.

PRAC. § 17.042(2); Lombardo v. Bhattacharyya, 437 S.W.3d 658, 679 (Tex. App.—

Dallas 2014, pet. denied). In this case, appellants did not generally allege that

Saidara committed a tort in Texas or did business in Texas. Accordingly, we

consider whether they alleged facts showing Saidara committed a tort in Texas. See

CIV. PRAC. § 17.042(2).

      Appellants allegations concerning acts by Saidara are as follows:

      8. . . . Personal jurisdiction exists as to Saidara because he had contacts
      with Texas with respect to the acts complained of herein, including
      travel to Texas specifically directed at the transaction forming the basis
      of this lawsuit.

      ....

                                        –14–
16. Frank Saidara is the Vice President of Corporate Development for
Prospect. Saidara was the senior executive tasked with obtaining
Southwest General’s trade secrets and other highly confidential
information. Saidara visited Texas in connection with the sale of
Southwest General’s assets and participated in numerous
communications (both electronically and telephonically) with
counterparties in Dallas during which he misrepresented Prospect’s
intention to purchase Southwest General. Saidara’s communications
were intentional and were directed to Steward in Texas.

17. During one of Saidara’s visits to Texas, he participated in a site visit
at the Southwest General Facility. During that visit, Saidara was
accompanied by James Summerset, the interim CEO of Nix Health [Nix
Health Services Corporation is a hospital in San Antonio owned by
Prospect Medical].
18. While on the site visit, Summerset asked an unusual amount of
questions about proprietary Southwest General data. Specifically,
Summerset inquired about physician employment arrangements and
compensation data.
19. Saidara oversaw the due diligence for the transaction—the process
through which Prospect and its representatives were able to review
Southwest General’s confidential and highly-sensitive business
information before entering into a definitive asset purchase agreement.

....

31. . . . [O]n September 14, 2018, or in the early morning hours of the
next day, Prospect made its move. With no notice, Saidara entered the
“clean room.” He waited to do so until after midnight. Until that
evening, Saidara’s access to the due diligence information had been
sporadic and mostly consisted of viewing financial related
documents . . . . But on this adventure after midnight, Saidara
downloaded all of the information in the clean room. This download
took just over a half hour and left Saidara and Prospect, and perhaps
others in possession of Steward’s most sensitive information—
information they can and inevitably will use to the benefit of themselves
and Nix Health to the detriment of Steward, Southwest General, and
patients and consumers of health care in Texas.

....

                                   –15–
Count I – Fraud

47. . . . [F]ollowing the indication of interest, Defendants
misrepresented throughout the due diligence period . . . that Prospect
intended to enter into a definitive asset purchase agreement for the
assets of Southwest General and to close on such an agreement.
Prospect never had any intention of doing so, and Defendants knew of
that intention and their role in Prospect’s scheme.

48. . . . Defendants intended that Plaintiffs would rely upon their
misrepresentations by moving forward with the proposed
transaction . . . .

Count II - Misappropriation of Trade Secrets (Texas Uniform
Trade Secrets Act)
....

52. Saidara’s surreptitious middle-of-the-night downloading of the
entire contents of the “clean room” constitutes a theft by Saidara and
Prospect of Southwest General’s trade secrets.
....

54. . . . Prospect and Saidara acquired the trade secret information
through improper means, including through fraud.

55. . . . Saidara disclosed Southwest General’s trade secret information
to other individuals at Prospect without the consent of Steward and
Southwest . . . .
....

58. Upon information and belief, Prospect’s and Saidara’s
misappropriation of Southwest General’s trade secrets was willful and
malicious.

Count III – Unfair Competition

....
60. . . . [B]y taking and retaining Southwest General’s confidential
information, . . . Prospect and Saidara have breached a confidential
business relationship with Steward and Southwest General.

                                 –16–
      61. . . . [B]y misleading Steward with their misrepresentations that
      Prospect intended to buy the assets of Southwest General . . . , Prospect
      and Saidara have engaged in conduct that is contrary to honest practices
      in commercial matters.

      ....
      Count IV – Violation of the Texas Harmful Access by Computer
      Act

      ....

      66. . . . Defendants accessed Plaintiffs’ data by accessing and
      downloading Steward’s confidential and trade secret information
      contained in the Clean Room for a purpose other than evaluating the
      Transaction.
Appellants also alleged a conspiracy between Prospect and Nix Health, but that

cause of action did not include any allegations against Saidara.

      Appellants’ allegations show the following concerning Saidara:

         • He visited Texas in connection with the sale of Southwest General’s
           assets.

         • He visited Texas and participated in a site visit of Southwest General’s
           facility with Summerset during which Summerset asked an unusual
           amount of questions.

         • He had electronic and telephonic communications with counterparties
           in Dallas during which he misrepresented Prospect’s intention to
           purchase Southwest General.

         • He oversaw due diligence for the transaction.

         • He went into the virtual clean room and downloaded all of Steward’s
           confidential data.

         • He disclosed the data to others at Prospect.

                                        –17–
The only allegations of conduct by Saidara in Texas are that he visited Texas in

connection with the sale, and he visited Texas on a site visit to Southwest General’s

facility with Summerset during which Summerset, not Saidara, asked questions.

There is no allegation in the petition that Saidara made any misrepresentation during

his visits to Texas. There is no allegation in the petition that he was in Texas when

he made the misrepresentations in his electronic and telephonic communications.

See Jani-King, 2016 WL 2609314, at * 4 (telephone calls and e-mails made from

outside Texas do not allege commission of tort in Texas). Nor is there any allegation

in the petition that Saidara made an in-person misrepresentation during his visit to

Texas. Finally, there is no allegation that Saidara was in Texas when he downloaded

all the data in the clean room.11

        Appellants rely on allegations in their response to the special appearance that

Saidara made fraudulent misrepresentations “[d]uring his visit to Texas,” and

“Saidara committed tortious fraud in Texas.” However, as discussed above, the

allegations to meet the long-arm statute must appear in the petition and not solely in

the plaintiff’s response to the special appearance. Accordingly we cannot consider

those allegations.

   11
      Saidara testified in his declaration that he was in California at the time appellants alleged he
downloaded the information.
                                                –18–
      We conclude appellants have not pleaded sufficient allegations to bring

Saidara within the provisions of the Texas long-arm statute. We overrule appellants’

issue on appeal.

                                IV. CONCLUSION
      We affirm the trial court’s order granting Saidara’s special appearance.

                                           /Lana Myers//
190274f.p05                                LANA MYERS
                                           JUSTICE

Opinion of the Court by Myers, J., joined by Burns, C.J., and Partida-Kipness,
Reichek, Goldstein, Smith, and Garcia, JJ.

Burns, C.J., concurring, joined by Myers, Osborne, Molberg, Partida-Kipness,
Reichek, Nowell, Carlyle, Goldstein, Smith, and Garcia, JJ.

Schenck, J., concurring.

Osborne, J., concurring in part and dissenting in part, joined by Pedersen, J., and
joined in part by Molberg, J.

Carlyle, J., dissenting, joined by Molberg and Nowell, JJ.

                                        –19–
                             Court of Appeals
                      Fifth District of Texas at Dallas
                                   JUDGMENT

 STEWARD HEALTH CARE                            On Appeal from the 193rd Judicial
 SYSTEM LLC AND SOUTHWEST                       District Court, Dallas County, Texas
 GENERAL HOSPITAL, LP,                          Trial Court Cause No. DC-18-16862.
 Appellants                                     Opinion delivered by Justice Myers.
                                                Court sitting en banc.
 No. 05-19-00274-CV           V.

 FRANK SAIDARA, Appellee

       In accordance with this Court’s opinion of this date, the order of the trial
court granting the special appearance of appellee FRANK SAIDARA is
AFFIRMED.

      It is ORDERED that appellee FRANK SAIDARA recover his costs of this
appeal from appellants STEWARD HEALTH CARE SYSTEM LLC and
SOUTHWEST GENERAL HOSPITAL, LP.

Judgment entered this 20th day of August, 2021.

                                         –20–