Court Opinion

ID: 6500211
Source: CourtListenerOpinion
Date Created: 2022-07-15 07:11:10.4592+00
Date Added: 2024-06-11T09:18:46.395215
License: Public Domain

In The

                                Court of Appeals

                    Ninth District of Texas at Beaumont

                               __________________

                               NO. 09-21-00199-CV
                               __________________

       GINO TENACE AND TENEGRITY HEALTH, INC., Appellants

                                         V.

   THURMAN HEALTH HOLDINGS, LLC, WILLIAM THURMAN,
 DKNS, LLC, NIMESH PATEL, CATO CREEK HOLDINGS COMPANY,
  LLC, REDWOOD PARTNERS, LLC, SAM SCOTT, VC PARTNERS,
  LLC, NIKESH JASANI, AND CLARUS HEALTH SERVICES, LLC,
                          Appellees

__________________________________________________________________

                On Appeal from the 457th District Court
                     Montgomery County, Texas
                   Trial Cause No. 19-09-11980-CV
__________________________________________________________________

                          MEMORANDUM OPINION

      Appellants Gino Tenace and Tenegrity Health, Inc. (Appellants) filed an

interlocutory appeal from the trial court’s denial of Appellants’ special appearances.

See Tex. Civ. Prac. & Rem. Code Ann. § 51.014(a)(7). Finding the trial court lacks

specific personal jurisdiction over Appellants, we reverse and render.

                                          1
                                    Background

      Appellees Thurman Health Holdings, LLC, William Thurman, DKNS, LLC,

Nimesh Patel, Cato Creek Holdings Company, LLC, Redwood Partners, LLC, Sam

Scott, VC Partners, LLC, Nikesh Jasani, and Clarus Health Services, LLC

(Appellees or Plaintiffs) filed this lawsuit against Appellants and one other

defendant, Tenegrity Ventures, LLC (collectively Defendants).1 According to the

petition, Tenace made false and misleading statements and omissions of material

fact that induced the Plaintiffs into investing more than $2 million into a new

healthcare palliative care company and then transferred control of their valuable

intellectual property to the Defendants, resulting in Plaintiffs incurring substantial

damages based on the Defendants’ wrongful conduct. Plaintiffs alleged that the

Plaintiff-investors formed Clarus Health Services, LLC and contributed over

$1,200,000 to develop valuable intellectual property. According to the petition,

Plaintiffs appointed Tenace as CEO of Clarus and Tenace induced the Plaintiff-

investors to transfer Clarus’s assets to Tenegrity Health, Inc. and Tenegrity

Ventures, LLC, and later to a different company, Palliative Care NewCo, Inc.

(“Palliative Care”). Plaintiffs alleged Tenace induced the Plaintiff-investors to

contribute additional funds. According to the petition, Tenace did not disclose that

      1
        Tenegrity Ventures, LLC is not a party to this appeal because it did not file
a special appearance.
                                        2
he was subject to a noncompete agreement with another healthcare company that

precluded him from assisting the Plaintiff-investors in the manner he represented he

would. Plaintiffs alleged that Tenace’s “numerous failures[]” resulted in Clarus and

Palliative Care no longer being in business and the Plaintiff-investors were “frozen

out” of Clarus and Palliative Care, “depriving them of the resources and intellectual

property they contributed, and access to their own company email accounts.”

      Plaintiffs asserted claims for fraudulent inducement (against Tenace),

negligent representation (against Tenace), claims under the Texas Theft Liability

Act (against all Defendants), breach of fiduciary duty (against Tenace), civil

conspiracy (against Tenace), aiding and abetting civil conspiracy (against Tenegrity

Ventures, LLC and Tenegrity Health, Inc.), and sought temporary and permanent

injunctive relief (against all Defendants). In the petition, Plaintiffs alleged that the

trial court had personal jurisdiction, stating:

      [] The Court has personal jurisdiction over Defendants pursuant to the
      Texas long-arm statute, Texas Civil Practice & Remedies Code
      section[] 17.042, because the harm resulting from Defendants’
      wrongful conduct has adversely impacted Plaintiffs Thurman Health
      Holdings, LLC, DKNS, LLC, Patel, VC Partners, LLC, and Jasani in
      Texas. In addition, the exercise of jurisdiction over Defendants is
      consistent with both state and federal due process requirements.

      Appellants filed a joint special appearance under Rule 120a of the Texas Rules

of Civil Procedure. As to specific jurisdiction, Appellants argued that, because

Plaintiffs failed to plead jurisdictional facts against the nonresident Appellants

                                            3
sufficient to bring them within reach of the Texas long-arm statute, Appellants met

their burden of negating the basis of the alleged jurisdiction by proving that they are

not residents of Texas, and Plaintiffs also failed to establish that exercising

jurisdiction over nonresidents Tenace and Tenegrity Health, Inc. comports with

federal and state guarantees of due process. As to general jurisdiction, Appellants

argued that the trial court lacked general jurisdiction over Tenace because he is not

domiciled in Texas and there are no allegations of any continuous and systematic

contacts by Tenace with Texas. Appellants also argued the trial court lacked general

jurisdiction over Tenegrity Health, Inc., because Tenegrity Health, Inc. is a Florida

corporation with its principal place of business in Tennessee and there were no

allegations by Plaintiffs of any continuous and systematic contacts by Tenegrity

Health with Texas and nothing to establish that Tenegrity Health’s affiliations with

Texas are so substantial as to render it “at home” in Texas. According to Appellants,

exercising jurisdiction over them as nonresidents and requiring them to defend the

lawsuit in Texas would offend traditional notions of fair play and substantial justice.

      In Tenace’s affidavit, attached as an exhibit to the special appearance, he

states that he is a resident of Minnesota, has never been a resident of Texas, has no

telephone listing in Texas, owns no property in Texas, has not entered into a contract

with a Texas resident, and has not recruited a Texas resident for employment.

Tenace also states that he was a founder and is the registered agent of Tenegrity

                                          4
Health, Inc., a Florida corporation with its principal place of business in Franklin,

Tennessee. According to Tenace’s affidavit, Tenegrity Health, Inc. maintains no

office in Texas, has no registered agent in Texas, has no telephone listing in Texas,

owns no property in Texas, has not entered into a contract with a Texas resident, and

has not recruited a Texas resident for employment. Tenace also stated that he was a

founding partner of Tenegrity Ventures, LLC, from which he separated in June 2018,

and neither he nor Tenegrity Health, Inc. have any ownership in or affiliation with

Tenegrity Ventures, LLC.

      In their special appearance, Tenace and Tenegrity Health, Inc. argued that the

Plaintiffs failed to allege that either Tenace or Tenegrity Health, Inc. as nonresident

Defendants committed any tortious act in Texas. According to Appellants’ special

appearance, Appellees’ “sole jurisdictional assertion is that ‘the harm resulting from

defendants’ wrongful conduct has adversely impacted Plaintiffs Therman Health

Holdings, LLC, DKNS, LLC, Patel, VC Partners, LLC, and Jasani in Texas.’”

Appellants argued that because the Plaintiffs’ petition made no allegation that the

nonresident Defendants committed any tortious or fraudulent act in Texas, the

Plaintiffs failed to plead jurisdictional facts against the nonresident Defendants

sufficient to bring them within reach of the Texas long-arm statute.

                                          5
      Appellees responded to Appellants’ special appearance. As to the court’s

jurisdiction over Appellants under the Texas long-arm statute, Appellees made these

arguments:

             The Court has jurisdiction over Defendants Tenace and
      Tenegrity Health pursuant to the Texas long-arm statute because of the
      business conducted by Defendants when they induced Plaintiffs, Texas
      residents, to enter into contracts in Texas and obtained partial
      performance in Texas.
             ....
             As the Original Petition alleges, based on Defendants’ wrongful
      conduct, Plaintiffs made investments of hundreds of thousands of
      dollars and transferred valuable intellectual property to Palliative
      Care.[] Specifically, the Original Petition alleged that, “Based on
      Tenace’s representations . . . Plaintiffs exercised their rights as Clarus
      healthcare shareholders to invest the additional $720,500 and purchase
      Palliative Care shares through various Subscription Agreements[.][]
      Tenace, in turn, “continued to carry out the role of CEO” and executed
      the “Subscription Agreements on behalf of Palliative Care.”[]
             As such, Defendants’ arguments that no jurisdiction exists
      because Plaintiff did not allege any tortious act committed by
      Defendants in Texas fails.[] Indeed, as Texas courts have found, actions
      similar to those carried out by Defendants are sufficient to exercise
      jurisdiction over nonresident defendants.[]

Appellees referenced a declaration from Nimesh Patel, some email correspondence,

and the subscription agreements executed by various parties. Appellees argued that

jurisdiction over Appellants comports with federal and state guarantees of due

process because the Appellants’ contacts satisfy the minimum contacts requirement

in that “Tenace’s own contacts were purposeful, and obtained the benefits sought by

Defendants when they availed themselves to this jurisdiction[]” and that “this action

arises out of Tenace’s contacts with this state as a result of Tenace’s scheme to
                                          6
defraud Plaintiffs of substantial amount of money and resources.” Appellees argued

that Appellants failed to negate all potential bases for personal jurisdiction and that

Tenace had entered into contracts—i.e., subscription agreements 2 with Texas

residents. Appellees did not assert a basis for general jurisdiction over Appellants in

their response to the special appearance but stated that “no discovery has taken place

in this matter that would allow Plaintiffs to ascertain whether Tenace’s contacts, at

relevant times, were continuous and systematic such that general jurisdiction is

established.”

      The trial court denied Appellants’ special appearance. Appellants filed a

request that the court issue findings of fact and conclusions of law, but the trial court

did not issue findings of fact or conclusions of law. Appellants filed this

interlocutory appeal, appealing the trial court’s denial of Appellants’ special

appearance.

      2
          The Subscription Agreement in the record is executed by Company,
Palliative Care NewCo, Inc., signed by Gino Tenace as CEO, and Subscriber, VC
Partners, LLC, signed by Nimesh Patel, as Manager. In that agreement, paragraph
5(h) contains a “Governing Law; Submission to Jurisdiction; Waiver of Jury Trial”
provision. Therein the parties agreed Delaware law governed and it selected
Delaware courts as the forum for disputes. “The parties hereby agree that any suit,
action or proceeding seeking to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions contemplated
hereby, whether in contract, tort or otherwise, shall be brought in the federal or state
courts located in Delaware, so long as one of such courts shall have subject-matter
jurisdiction over such suit, action or proceeding, and that any cause of action arising
out of this Agreement shall be deemed to have arisen from a transaction of business
in the State of Delaware.”
                                            7
                                 Issues on Appeal

      In their first issue, Appellants argue the trial court erred in denying their

special appearance because Appellees did not meet their initial burden of pleading

sufficient facts to bring Appellants under the reach of the Texas long-arm statute

and, even if they did, Appellants met their corresponding burden to negate

jurisdiction by proving that they do not reside in Texas. In their second issue,

Appellants argue that even if the Appellees met their initial burden of pleading

sufficient facts to bring Appellants within the reach of the Texas long-arm statute,

the exercise of personal jurisdiction over Appellants fails to comport with state and

federal constitutional guarantees of due process.

                     Standard of Review and Applicable Law

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

ultimately a question of law that we review de novo. Moncrief Oil Int’l, Inc. v. OAO

Gazprom, 414 S.W.3d 142, 150 (Tex. 2013); BMC Software Belgium, N.V. v.

Marchand, 83 S.W.3d 789, 794 (Tex. 2002). The plaintiff has the initial burden of

pleading sufficient allegations to bring a nonresident defendant within the

jurisdiction of a Texas court. Moncrief Oil Int’l, Inc., 414 S.W.3d at 149; Kelly v.

Gen. Interior Constr., Inc., 301 S.W.3d 653, 658 (Tex. 2010); Retamco Operating,

Inc. v. Republic Drilling Co., 278 S.W.3d 333, 337 (Tex. 2009); Booth v.

Kontomitras, 485 S.W.3d 461, 476 (Tex. App.—Beaumont 2016, no pet.). If the

                                         8
plaintiff meets this initial burden, “the burden shifts to the defendant to negate all

potential bases for personal jurisdiction the plaintiff pled.” Moncrief Oil Int’l, Inc.,

414 S.W.3d at 149; see also BMC Software, 83 S.W.3d at 793. The defendant may

negate the jurisdictional allegations on either a factual or legal basis. Kelly, 301

S.W.3d at 659. There being no timely filed findings of fact and conclusions of law,

“all facts necessary to support the judgment and supported by the evidence are

implied.” BMC Software, 83 S.W.3d at 795. When jurisdictional facts are

undisputed, we need not consider any implied findings of fact and we consider only

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

Republic Nat’l Title Ins. Co. v. Bell, 549 S.W.3d 550, 558 (Tex. 2018) (citing Tex.

Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004); Moncrief

Oil Int’l, Inc., 414 S.W.3d at 150 n.4). When reviewing Appellees’ jurisdictional

allegations, we ask only whether the allegations are sufficient to invoke the exercise

of personal jurisdiction over Appellants without regard to the merits of their claims.

See Booth, 485 S.W.3d at 477.

      A trial court has personal jurisdiction over a nonresident defendant if the

exercise of jurisdiction is authorized by statute and is consistent with federal and

state constitutional due process guarantees. Moncrief Oil Int’l, Inc., 414 S.W.3d at

149; Spir Star AG v. Kimich, 310 S.W.3d 868, 872 (Tex. 2010); see also Tex. Civ.

Prac. & Rem. Code Ann. § 17.042. The Texas long-arm statute provides that a

                                           9
nonresident does business in the state if the nonresident commits certain acts in

Texas, including, but not limited to, the following:

      (1) 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;
      (2) commits a tort in whole or in part in this state; or
      (3) recruits Texas residents, directly or through an intermediary located
          in this state, for employment inside or outside this state.

Tex. Civ. Prac. & Rem. Code Ann. § 17.042. Although an allegation of jurisdiction

may satisfy the Texas long-arm statute, the allegation may not necessarily satisfy the

United States Constitution. Moncrief Oil Int’l, Inc., 414 S.W.3d at 149. As a result,

even if a court determines the facts satisfy the Texas long-arm statute, the court must

also examine the facts to determine whether the exercise of personal jurisdiction

over the defendant comports with due process. See CSR Ltd. v. Link, 925 S.W.2d

591, 594 (Tex. 1996).

      Asserting personal jurisdiction over a nonresident defendant comports with

due process when (1) the nonresident defendant has minimum contacts with the

forum state, and (2) asserting jurisdiction comports with traditional notions of fair

play and substantial justice. Retamco, 278 S.W.3d at 338. The minimum contacts

analysis requires “‘some act 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.’” Michiana Easy Livin’ Country, Inc. v. Holten, 168

SW.3d 777, 784 (Tex. 2005) (quoting Hanson v. Denckla, 357 U.S. 235, 253

                                          10
(1958)). The focus is on the defendant’s activities and expectations. Am. Type

Culture Collection, Inc. v. Coleman, 83 S.W.3d 801, 806 (Tex. 2002). Only the

defendant’s contacts with the forum are relevant, not the unilateral activity of

another party or a third person. Moki Mac River Expeditions v. Drugg, 221 S.W.3d

569, 575 (Tex. 2007); see also Walden v. Fiore, 571 U.S. 277, 291 (2014) (“[I]t is

the defendant, not the plaintiff or third parties, who must create contacts with the

forum State.”).

      A defendant’s contacts may support either general jurisdiction or specific

jurisdiction. See Moncrief Oil Int’l, Inc., 414 S.W.3d at 150; Zinc Nacional, S.A. v.

Bouche Trucking, Inc., 308 S.W.3d 395, 397 (Tex. 2010). Continuous and

systematic contacts with Texas may support general jurisdiction, while specific

jurisdiction exists when the cause of action arises out of or relates to specific

purposeful activities of the defendant in Texas. Moncrief Oil Int’l, Inc., 414 S.W.3d

at 150.3 “‘[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.’” Searcy v. Parex Res., Inc., 496 S.W.3d 58,

70 (Tex. 2016) (quoting Moki Mac, 221 S.W.3d at 585); see also Guardian Royal

      3
         Because Plaintiffs only asserted specific jurisdiction as a basis for personal
jurisdiction over Appellants, we need not discuss general jurisdiction and limit our
discussion and analysis to specific jurisdiction.
                                          11
Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex.

1991).

      Specific jurisdiction exists where there is evidence that the defendant

purposefully availed itself of the forum’s jurisdiction by contacts or activities in the

forum state, and the cause of action arises from or relates to those contacts or

activities. Ford Motor Co. v. Mont. Eighth Judicial Dist. Court, 141 S. Ct. 1017,

1024-25 (2021); Retamco, 278 S.W.3d at 338 (citing Burger King Corp. v.

Rudzewicz, 471 U.S. 462, 472 (1985)); BMC Software, 83 S.W.3d at 795-96. Under

specific jurisdiction, the focus is on the relationship between the forum, the

defendant, and the litigation. Ford Motor Co., 141 S. Ct. at 1028; Moncrief Oil Int’l,

Inc., 414 S.W.3d at 150; Retamco, 278 S.W.3d at 338. There must be a substantial

connection between the defendant’s contacts and the operative facts of the litigation.

Moncrief Oil Int’l, Inc., 414 S.W.3d at 151, 156. The contacts must be such that the

defendant “should reasonably anticipate being haled into court” in Texas. World-

Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). As for tort claims,

simply because the defendant directs a tort from outside the forum that occurred in

Texas would not be sufficient for a Texas court to automatically exercise personal

jurisdiction over a nonresident because it confuses the proper focus which should be

on the defendant’s contacts with Texas and purposeful availment. Michiana, 168

S.W.3d at 790-91. We must analyze the jurisdictional contacts on a “claim-by-claim

                                          12
basis” unless all claims arise from the same forum contacts. Moncrief Oil Int’l, Inc.,

414 S.W.3d at 150-51. Here, all the claims arise from the same alleged forum

contacts.

       When considering whether the nonresident purposefully availed itself of the

privilege of conducting activities within Texas, we look at three factors: (1) whether

the defendant had contacts and activity in and with Texas; (2) whether the contacts

relied upon were purposeful rather than random, fortuitous, or attenuated; and (3)

whether the defendant sought some benefit, advantage, or profit by availing itself of

the jurisdiction. Id. at 151.

       The plaintiff bears the initial burden of pleading allegations sufficient to

confer jurisdiction. Luciano v. SprayFoamPolymers.com, LLC, 625 S.W.3d 1, 8

(Tex. 2021). The burden then shifts to the defendant to negate all bases of

jurisdiction in the allegations. Id. The plaintiff defines the scope and nature of the

lawsuit, so the defendant’s corresponding burden to negate jurisdiction is tied to the

allegations in the plaintiff’s pleading. Kelly, 301 S.W.3d at 658.

       The defendant can negate jurisdiction on either a factual or legal basis.
       Factually, the defendant can present evidence that it has no contacts
       with Texas, effectively disproving the plaintiff’s allegations. 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. Legally, the
       defendant can show that even if the plaintiff’s alleged facts are true, the
       evidence is legally insufficient to establish jurisdiction . . . .

                                           13
Id. at 659 (footnotes omitted). To bring a defendant within reach of the Texas long-

arm statute for a tort claim, the plaintiff needs to plead that the defendant committed

tortious acts in Texas. Id. at 658-59; see also Tex. Civ. Prac. & Rem. Code Ann.

§ 17.042(2).

                                 Specific Jurisdiction

      In their first issue, Appellants argue the trial court erred in denying their

special appearance because Appellees did not meet their initial burden of pleading

sufficient facts to bring Appellants under the reach of the Texas long-arm statute.

Appellants also contend that even if the Plaintiffs met their initial pleading burden,

Appellants negated jurisdiction by proving that they do not reside in Texas and that

they lack sufficient contacts and activities in Texas, and the Plaintiffs failed to meet

their burden to present a basis for personal jurisdiction in their response. Appellees

respond by arguing the trial court has jurisdiction over Appellants under the Texas

long-arm statute “because of the business conducted by Appellants when they

induced Appellees, Texas residents, to enter into contracts in Texas and obtained

partial performance in Texas.” According to Appellees, Tenace’s own contacts were

aimed at Texas and were purposeful, the suit arises out of Tenace’s contacts with

Texas, and Appellants failed to negate all potential bases for personal jurisdiction.

                                          14
                Insufficiency of Allegations in Petition and Response

      Plaintiff’s Original Petition alleges “The Court has personal jurisdiction over

Defendants pursuant to the Texas long-arm statute, Texas Civil Practice & Remedies

Code section[] 17.042, because the harm resulting from Defendants’ wrongful

conduct has adversely impacted Plaintiffs.” On appeal and in their response to the

special appearance, Appellees rely on that statement as a factual basis for their tort

claim. That allegation is conclusory and does not constitute a jurisdictional fact or

allege that Appellants committed tortious acts in Texas. Appellees also point to

allegations in their petition where they alleged that “[b]ased on Tenace’s

representations . . . Plaintiffs exercised their rights as Clarus [] shareholders to invest

the additional $720,500 and purchase Palliative Care shares through various

Subscription Agreements[]” and Tenace “continued to carry out the role of CEO”

and “sign[ed] the Subscription Agreements on behalf of Palliative Care.” Once

again, these allegations fail to allege jurisdictional facts about Appellants conduct in

Texas. There are no allegations in the petition or in the response Plaintiffs filed to

the Special Appearance that Appellants made misrepresentations in Texas, held

meetings in Texas, executed agreements in Texas, solicited investors in Texas, or

committed any act or tort in Texas.

      Appellants attached Tenace’s affidavit as an exhibit to their special

appearance. In his affidavit, Tenace averred that he is a resident of Minnesota, has

                                            15
never been a resident of Texas, has no telephone listing in Texas, owns no property

in Texas, has not entered into a contract with a Texas resident, and has not recruited

a Texas resident for employment. The affidavit also states that he was a founder and

is the registered agent of Tenegrity Health, Inc., a Florida corporation with its

principal place of business in Franklin, Tennessee. According to Tenace’s affidavit,

Tenegrity Health, Inc. maintains no office in Texas, has no registered agent in Texas,

has no telephone listing in Texas, owns no property in Texas, has not entered into a

contract with a Texas resident, and has not recruited a Texas resident for

employment.

      We conclude that Appellees failed to plead any jurisdictional facts against

Appellants that would establish that Appellants committed conduct and actions

within the long-arm statute, and so Appellants met their special-appearance burden

by proving they are not Texas residents. See Kelly, 301 S.W.3d at 660; Booth, 485

S.W.3d at 476. Appellees do not challenge Appellants’ contention that Appellants

are not Texas residents.

      The burden then shifted back to Appellees to establish in their response to the

special appearance why the trial court had personal jurisdiction over Appellants. In

their response, Appellees relied upon the allegations in their petition and did not

attach evidence that establishes that Appellants committed a tort in Texas or

purposely availed themselves of doing business in Texas. Rather, even if we liberally

                                         16
construe their allegations, at most they have alleged that the “effects” of Appellants’

conduct harmed Texas residents in Texas. In their response, Appellees argued that

Tenace entered into a contract with a Texas resident when he executed the

subscription agreement. Tenace signed a subscription agreement on behalf of

Palliative Care, and the subscription agreement was also executed by Subscriber,

VC Partners LLC, signed by Nimesh Patel, as Manager.

      Personal jurisdiction under the effects test cannot depend solely upon where

the defendant “directed a tort” because that approach improperly shifts the focus to

the relationship of the plaintiff to the forum rather than on the relationship of the

defendant to the forum and the litigation. See Old Republic, 549 S.W.3d at 565

(stating that “effects test” does not displace purposeful availment requirement);

Kelly, 301 S.W.3d at 661 (requiring defendants to have engaged in conduct in Texas

that amounted to “a substantial presence”). The mere existence or allegation of a

conspiracy or fraudulent conduct directed at a Texas resident is not sufficient to

confer jurisdiction. Nat’l Indus. Sand Ass’n v. Gibson, 897 S.W.2d 769, 773 (Tex.

1995). “Jurisdiction cannot turn on whether a defendant denies wrongdoing—as

virtually all will. Nor can it turn on whether a plaintiff merely alleges wrongdoing—

again as virtually all will.” Michiana, 168 S.W.3d at 791. And, although we are

careful not to confuse “the roles of judge and jury by equating the jurisdictional

inquiry with the underlying merits[,]” we must examine “the alleged contacts.” Old

                                          17
Republic, 549 S.W.3d at 560. Appellees have not stated how the subscription

agreement or any other contract was performed or partially performed in Texas, and

mere allegations that Plaintiffs as Texas residents entered into contracts with Tenace

or that funds were sent to Texas are insufficient to establish personal jurisdiction.

See id. at 565. Appellees failed to present the trial court with evidence negating

Tenace’s nonresident affirmations or otherwise establishing personal jurisdiction

over the Appellants. See Michiana, 168 S.W.3d at 778-92.

      After examining the alleged contacts of Appellants with Texas, we sustain

issue one, and we need not reach issue two on whether the exercise of jurisdiction is

consistent with federal and state constitutional due process guarantees. See Tex. R.

App. P. 47.1; see also Kelly, 301 S.W.3d at 660; Booth, 485 S.W.3d at 476.

      We conclude that the trial court erred in denying Appellants’ special

appearance. We reverse the trial court’s order denying Appellants’ special

appearance and render the judgment the trial court should have rendered, dismissing

Appellees’ claims against Appellants for lack of personal jurisdiction. See Tex. R.

App. P. 43.2(c).

      REVERSED AND RENDERED.
                                                    _________________________
                                                        LEANNE JOHNSON
                                                              Justice
Submitted on January 13, 2022
Opinion Delivered July 14, 2022

Before Golemon, C.J., Kreger and Johnson, JJ.
                                         18