United States District Court, W.D. Texas, Austin Division
PITMAN UNITED STATES DISTRICT JUDGE
the Court is Plaintiff Rapid Radiology, Inc.'s
(“Rapid Radiology”) Motion for Leave to Conduct
Jurisdictional Discovery and Motion to Extend Responsive
Deadline. (Dkt. 6). Earlier in this action, Defendant Orlando
Diagnostic Center, Inc. (“Orlando Diagnostic”)
filed a motion to dismiss, (Dkt. 5), in which it argues that
the Court lacks personal jurisdiction over it. (Id.
at 3-8). Instead of filing a response, Rapid Radiology filed
this motion to ask for an extension of time to respond and
permission to conduct limited discovery. (Mot. Leave, Dkt. 6,
at 8). Rapid Radiology asserts that Orlando Diagnostic's
motion to dismiss is premised on disputed facts and asks for
discovery to develop evidence relevant to those facts.
(Id. at 7). Orlando Diagnostic responds that
discovery is unnecessary and inappropriate. (Resp., Dkt. 8).
For the reasons that follow, the Court agrees with Rapid
Radiology that limited jurisdictional discovery is warranted.
party opposing dismissal and requesting discovery, Rapid
Radiology has the “burden of demonstrating the
necessity of discovery.” Monkton Ins. Servs., Ltd.
v. Ritter, 768 F.3d 429, 434 (5th Cir. 2014) (citation
omitted). Rapid Radiology can meet its burden by alleging
facts that “suggest with reasonable particularity the
possible existence of the requisite contacts” between
Orlando Diagnostic and the forum state. Fielding v.
Hubert Burda Media, Inc., 415 F.3d 419, 429 (5th Cir.
2005) (citation and quotation marks omitted). District courts
have “broad discretion in all discovery matters,
” but should not permit jurisdictional discovery if
“the lack of personal jurisdiction is clear [and]
discovery would serve no purpose.” Wyatt v.
Kaplan, 686 F.2d 276, 284 (5th Cir. 1982).
Radiology alleges the following. Orlando Diagnostic, a
Florida corporation located principally in Florida,
contracted with Rapid Radiology to receive radiology
services. (Orig. Pet., Dkt. 1-3, at 2-4). The contract
includes a forum selection clause stating that “Travis,
County, Texas shall be the sole and exclusive venue for any
litigation . . . that may be brought or arise out of, in
connection with, or by reason of this Agreement.”
(Id. at 3). Rapid Radiology also alleges that the
contract was executed in Travis County and that
“performance and payments were to occur in Travis
County.” (Id.). According to Rapid Radiology,
these facts establish the Court's personal jurisdiction
over Orlando Diagnostic. (Id.).
Diagnostic, meanwhile, argues that the contract was never
signed by someone with the authority to bind the company and
that the forum selection clause thus has no effect. (Mot.
Dismiss, Dkt. 5, at 6). Orlando Diagnostic also argues that
it has no connection with Texas other than making payments to
Rapid Radiology, which has its principal office in Texas.
(Id. at 7-8).
Radiology alleges that it spoke with Lynde Florence, now a
former employee of Orlando Diagnostic, who says she signed
the contract with authorization from Dr. Wasim Ahmar, Orlando
Diagnostic's owner. (Mot. Leave, Dkt. 6, at 2, 5-6).
Rapid Radiology asks the Court to permit it to depose Ms.
Florence and Dr. Ahmar. (Id. at 8).
Diagnostic opposes Rapid Radiology's request for
discovery on the grounds that it would be unnecessary because
Rapid Radiology would be unable to establish its right to
enforce the agreement. (Resp. Mot. Leave, Dkt. 8, at 3).
First, Orlando Diagnostic argues that Rapid Radiology, Inc.
does not actually exist as a Texas corporation and did not
exist when the contract was executed, and thus that it had no
right to contract with Orlando Diagnostic to begin with.
(Id. at 4). Second, Orlando Diagnostic argues that
Rapid Radiology only seeks discovery to establish apparent
authority, which can be determined without discovery because
apparent authority is determined by a third party's
interpretation of the principal's conduct. (Id.
of Orlando Diagnostic's arguments persuade the Court that
jurisdictional discovery is unwarranted. As to its first
argument, Orlando Diagnostic essentially asks the Court to
determine disputed facts about Rapid Radiology's
corporate existence and on that basis determine that it has
cannot obtain relief as a matter of law. The Court is without
the authority to make such a determination at this stage in
the litigation and therefore declines to do so. As to its
second argument, Orlando Diagnostic misconstrues Rapid
Radiology's allegations. Rapid Radiology alleges that Ms.
Florence “was specifically instructed by Dr.
Ahmar” to sign the contract, that Ms. Florence
“was fully authorized to execute documents” on
Orlando Diagnostic's behalf, and that she was
“fully authorized to bind” the company. (Mot.
Leave, Dkt. 6, at 5). Actual authority depends on
communications from the principal to the agent. Gaines v.
Kelly, 235 S.W.3d 179, 182 (Tex. 2007). Thus we have a
disputed issue of fact-did Ms. Florence possess actual
authority to bind Orlando Diagnostic?-that is central to the
issue of the Court's exercise of personal jurisdiction.
Discovery is appropriate to resolve this factual dispute.
these reasons, the Court GRANTS Rapid
Radiology's Motion for Leave to Conduct Jurisdictional
Discovery and Motion to Extend Responsive Deadline, (Dkt. 6),
and ORDERS as follows: (1) Rapid
Radiology's deadline to respond to Orlando
Diagnostic's motion to dismiss is extended to
April 30, 2018. (2) In the meantime, Rapid
Radiology is permitted to depose Dr. Wasim Ahmar and Ms.
Lynde Florence, subject to the limitation that the scope of
the depositions shall be limited to establishing the
Court's jurisdiction over ...