Court Opinion

ID: 3106048
Source: CourtListenerOpinion
Date Created: 2015-10-16 05:52:33.980504+00
Date Added: 2024-06-11T11:51:58.093794
License: Public Domain

NUMBER 13-10-00127-CV

                           COURT OF APPEALS

                  THIRTEENTH DISTRICT OF TEXAS

                    CORPUS CHRISTI - EDINBURG

RAINBOW MANAGEMENT OF
HILLSBOROUGH, INC.                                                        Appellant,

                                         v.

MONSERRATO TREVINO,                                                       Appellee.

                  On appeal from the County Court at Law
                      No. 1 of Hidalgo County, Texas.

                        MEMORANDUM OPINION
 Before Chief Justice Valdez and Justices Rodriguez and Benavides
            Memorandum Opinion by Justice Benavides
      In this interlocutory, accelerated appeal, appellant, Rainbow Management of

Hillsborough, Inc. (―Rainbow‖), a North Carolina corporation, appeals the denial of its
special appearance in the underlying premises liability suit filed in Hidalgo County by

appellee, Monserrato Trevino.          See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(7)

(Vernon 2008) (providing for appeals from interlocutory orders granting or denying a

special appearance); TEX R. APP. P. 28.1 (setting out the requirements for an

accelerated appeal).       By one issue, Rainbow contends that the trial court erred in

denying its special appearance because the trial court did not have personal jurisdiction

over Rainbow. We reverse and render judgment granting the special appearance.

                                          I. BACKGROUND

        In his first amended original petition, Trevino alleges that in June 2007, his

employer, Velacorp Pharmacists Inc. d/b/a San Juan Pharmacy, made a reservation on

his behalf at the Holiday Inn Express, located in Hillsborough, North Carolina, and that

during his two week stay, he suffered ―a severe allergic reaction in the form of skin

lesions as a result of a dangerous condition which persisted‖ in his room. Trevino

asserted negligence and DTPA causes of action based on ―insect bites‖ that he allegedly

suffered during his stay.        Trevino named the following as co-defendants:                  (1) his

employer; (2) Rainbow Hospitality, LLC d/b/a Holiday Inn Express;1 and (3) Rainbow

Management of Hillsborough, Inc, the appellant in this case.                 Rainbow Management

filed a special appearance challenging the personal jurisdiction of the Hidalgo County

Court. In support, Rainbow filed an affidavit of Anjan Desai, Rainbow‘s President, in

which Desai asserted:

        1
         Rainbow Hospitality, LLC also filed a special appearance which was denied by the trial court and
appealed in a separate cause, No. 13-09-00533-CV.
                                                   2
       Rainbow Management is not a resident of Texas. In this regard, Rainbow
       Management is a North Carolina corporation and Rainbow Management‘s
       principal place of business is located in the State of North Carolina.
       Rainbow Management does not have any offices or businesses located in
       the State of Texas. Rainbow Management does not have any employees
       or agents who work for Rainbow Management in the State of Texas and
       Rainbow Management has never had any employees or agents who have
       worked for Rainbow Management in the State of Texas. Rainbow
       Management does not have any bank accounts in the State of Texas and
       Rainbow Management has never had any bank accounts in the State of
       Texas. Rainbow Management has never sent any advertising letters or
       advertising fliers to individuals in the State of Texas and Rainbow
       Management has never sent any other types of advertising materials to
       individuals in the State of Texas. Rainbow Management does not place
       orders to companies in the State of Texas for any of the supplies that
       Rainbow Management uses in its business. Rainbow Management does
       not ship any types of products to the State of Texas. The incident that
       [Trevino] is alleging in this lawsuit occurred in the State of North Carolina.
       Rainbow Management did not contact Mr. Trevino about Mr. Trevino‘s
       coming to the State of North Carolina for the stay that forms the basis of
       Mr. Trevino‘s allegations. No part of Mr. Trevino‘s agreement with
       Rainbow Management to stay at the hotel where the incident [making] the
       basis of Mr. Trevino‘s lawsuit occurred was to be performed in the State of
       Texas.

       In an unsworn response to Rainbow‘s special appearance, Trevino contended

that Rainbow ―failed to negate each of the jurisdictional allegations‖ and, further, that

Rainbow ―failed to negate the issues giving rise to the causes of action that relate

specifically to its contacts with Texas via internet activity that resulted in contractual

services.‖   Rainbow failed to receive notice of the hearing date for the special

appearance, so the special appearance was denied on February 26, 2010 without

Rainbow being present.     Upon a granted rehearing of Rainbow‘s special appearance,

counsel for Rainbow asserted that Rainbow was ―the company that actually manages

the hotel in North Carolina.‖ Counsel for Trevino argued at the rehearing that personal

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jurisdiction was based on the interactive nature of the hotel website but presented no

evidence about the website. The trial court did not amend its previous order denying

Rainbow‘s special appearance, and this appeal ensued.

                     II. STANDARD OF REVIEW AND APPLICABLE LAW

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

question of law.   BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 794 (Tex.

2002); Exito Elecs. Co. v. Trejo, 166 S.W.3d 839, 849 (Tex. App.–Corpus Christi 2005,

no pet.). If an order on a special appearance is based on undisputed or otherwise

established facts, we review the exercise of personal jurisdiction de novo.    Exito, 166
S.W.3d at 849 (citing Happy Indus. Corp. v. Am. Specialties, Inc., 983 S.W.2d 844, 848

(Tex. App.–Corpus Christi 1998, pet. dism'd w.o.j.)).

      ―Texas courts may assert personal jurisdiction over a nonresident defendant only

if such jurisdiction is authorized by the Texas long-arm statute, and is consistent with

federal and state standards of due process.‖ Exito, 166 S.W.3d at 850.

              Jurisdiction is proper [under due process standards] if a nonresident
      defendant has established ―minimum contacts‖ with Texas and
      maintenance of the suit will not offend ―traditional notions of fair play and
      substantial justice.‖ The purpose of minimum-contacts analysis is to
      protect the defendant from being haled into court when its relationship with
      Texas is too attenuated to support jurisdiction. Focus is therefore upon
      the defendant's activities and expectations. This analysis requires that
      the defendant ―purposefully avail‖ itself of the privilege of conducting
      activities in Texas, thus invoking the benefits and protections of Texas laws
      such that the defendant could reasonably anticipate being called into a
      Texas court. Jurisdiction will not attach if contacts are random, fortuitous,
      or attenuated. The quality and nature of the contacts, rather than their
      number, are the focus of this analysis.

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Id. (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985); World-Wide

Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980); Int'l Shoe Co. v. Wash., 326
U.S. 310, 316 (1940); Am. Type Culture Collection, Inc. v. Coleman, 83 S.W.3d 801, 806

(Tex. 2002); Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815
S.W.2d 223, 226, 230 n.11 (Tex. 1991); Schlobohm v. Schapiro, 784 S.W.2d 355, 357

(Tex. 1990)).

       A nonresident defendant's minimum contacts with Texas may confer either

general or specific jurisdiction.    BMC, 83 S.W.3d at 795.          Specific jurisdiction is

established where activities of the defendant in the forum are isolated or disjointed, but

where the cause of action in issue arises from a particular activity in the forum state.   Id.

at 796.   ―Even a single act or event, if it creates or gives rise to the plaintiff's cause of

action, may constitute sufficient minimum contact to support the exercise of specific

jurisdiction.‖   Exito, 166 S.W.3d at 850-51.        ―This requirement for a ‗substantial

connection‘ between the plaintiff's cause of action and the defendant's contacts means

that those contacts, both with the litigation and the forum, must be meaningful, not

‗random, fortuitous, or attenuated.‘‖   Id. at 851 (quoting Ahadi v. Ahadi, 61 S.W.3d 714,

719 (Tex App.–Corpus Christi 2001, pet. denied)). The substantial connection between

the nonresident defendant and the forum state necessary for a finding of minimum

contacts must come about by action or conduct of the nonresident defendant

purposefully directed toward the forum state.     Guardian Royal, 815 S.W.2d at 226.

       General jurisdiction is established where the defendant's activities in the forum

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are continuing and systematic.     BMC, 83 S.W.3d at 796; Guardian Royal, 815 S.W.2d

at 228; Schlobohm, 784 S.W.2d at 357.        ―General jurisdiction requires a showing that

the defendant conducted substantial activities within the forum, a more demanding

minimum contacts analysis than for specific jurisdiction.‖    BMC, 83 S.W.3d at 797.

       ―While a plaintiff bears the initial burden of pleading allegations sufficient to bring

a nonresident defendant within the provisions of the long-arm statute, upon the filing of a

special appearance the nonresident defendant assumes the burden to negate all bases

of personal jurisdiction alleged by the plaintiff.‖     Exito, 166 S.W.3d at 851 (citing

Coleman, 83 S.W.3d at 807; Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203

(Tex. 1985) (per curiam)).      ―Once the defendant has produced credible evidence

negating all bases of jurisdiction, the plaintiff bears the ultimate burden to establish that

the Texas court has personal jurisdiction over the defendant as a matter of law.‖

M.G.M. Grand Hotel, Inc. v. Castro, 8 S.W.3d 403, 408 n.2 (Tex. App.–Corpus Christi

1999, no pet.).

                                       III. ANALYSIS

       By its only issue, Rainbow contends that the trial court did not have personal

jurisdiction over it—neither specific or general—and therefore, the court erred in denying

its special appearance. We apply all facts to the law de novo.       See Exito, 166 S.W.3d

at 849.    It is undisputed that Rainbow is a non-resident corporation. Therefore, our

analysis must determine:     (1) what grounds for jurisdiction were alleged by Trevino; (2)

if Rainbow sufficiently negated all such alleged grounds; and (3) if Rainbow did negate

                                              6
all such grounds, whether Trevino met his burden of showing that personal jurisdiction

existed as a matter of law.

       In his petition, Trevino alleged that:         (1) Rainbow had ―continuous and

systematic‖ contacts with the State of Texas (general jurisdiction); and (2) Rainbow

―engaged in activities constituting business in the state of Texas as provided by Section

17.042 of the Texas Civil Practice and Remedies Code, in that [Rainbow] contracted with

a Texas resident and performance of the agreement in whole or in part thereof was to

occur in Texas‖ (specific jurisdiction).     Because these grounds for jurisdiction were

alleged in the petition, we now turn to the question of whether Rainbow sufficiently

negated each ground.       See Exito, 166 S.W.3d at 851.

       First, in response to Trevino‘s allegation that general jurisdiction existed because

Rainbow had ―continuous and systematic‖ contacts with Texas, Desai‘s affidavit states

that Rainbow had none of the contacts with Texas that would normally justify general

jurisdiction.    Specifically, he affirms that Rainbow did not ship to or order supplies from

Texas, did not purposefully advertise in Texas, and did not have offices, employees, or

bank accounts in Texas.         We conclude this is a sufficient negation of the alleged

continuous and systematic contacts necessary to establish general jurisdiction over

Rainbow.        See Reiff v. Roy, 115 S.W.3d 700, 706-07 (Tex. App.–Dallas 2003, pet.

denied) (affirming a Colorado hotel‘s special appearance under nearly identical facts);

BMC, 83 S.W.3d at 797 (noting that general jurisdiction requires ―a more demanding

minimum contacts analysis than [that] for specific jurisdiction‖). Where the defendant

                                               7
negates by sufficient evidence the alleged ground for personal jurisdiction, the plaintiff

ultimately has the burden of establishing jurisdiction.    M.G.M. Grand, 8 S.W.3d at 408

n.2.   In this case, Trevino presented no evidence to the trial court concerning any of the

continuous and systematic contacts that Rainbow allegedly had within the State of

Texas. Therefore, Trevino failed to meet his burden, and we conclude that the trial

court did not have general jurisdiction over Rainbow.

       Second, Trevino alleges that personal jurisdiction existed because Rainbow

entered into a contract with Trevino in which performance of the contract, in part, was to

occur within the State of Texas.       At the special appearance rehearing, counsel for

Trevino indicated that this partial performance was the payment of the room rental fee

over an internet site accessed in Texas.     Desai stated in his affidavit that ―[t]he incident

that [Trevino] is alleging in this lawsuit occurred in the State of North Carolina.   Rainbow

Management did not contact Mr. Trevino about Mr. Trevino‘s coming to the State of

North Carolina for the stay that forms the basis of Mr. Trevino‘s allegations.‖            He

additionally affied that ―[n]o part of Mr. Trevino‘s agreement with Rainbow Management

to stay at the hotel where the incident [making] the basis of Mr. Trevino‘s lawsuit

occurred was to be performed in the State of Texas.‖ These sworn statements were

enough to negate Trevino‘s allegation that partial performance of a contract between

Trevino and Rainbow occurred in Texas, and, therefore, the burden rested on Trevino to

ultimately prove that: (1) such a contract existed; (2) partial performance was to take

place within the State of Texas; and (3) exercising jurisdiction would not violate

                                              8
traditional notions of fair play and substantial justice.   See TEX. CIV. PRAC. & REM. CODE

ANN. § 17.042 (Vernon 2008).           However, again, Trevino provided no affidavits,

contracts, internet web pages, or any evidence whatsoever to establish the truth of his

allegations.   Because the burden had shifted to Trevino, we conclude that he did not

establish specific jurisdiction due to in-state performance of a contract as a matter of law.

We do not reach the issue of whether the hotel‘s website actually created minimum

contacts within the state of Texas, because Trevino did not offer any evidence about the

characteristics of the website on which we could base such holdings.

       Based on the foregoing, we sustain Rainbow‘s issue on appeal.          See Guardian

Royal, 815 S.W.2d at 226; Reiff, 115 S.W.3d at 706-07.

                                      IV. CONCLUSION

       We reverse and render judgment granting the special appearance, and we

dismiss Trevino‘s claims against Rainbow for want of personal jurisdiction.

                                                            ________________________
                                                            GINA M. BENAVIDES,
                                                            Justice

Delivered and filed the
28th day of April, 2011.

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