United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION AND ORDER
J. BOYLE, UNITED STATES DISTRICT JUDGE.
hearing on June 25, 2018, the Court sua sponte raised whether
it had personal jurisdiction over Defendant Four Winds
Interactive, LLC. After finding that it did not, the Court
dismissed this case. This Order explains why.
This is a breach-of-contract
case. In January 2015, Plaintiff Third Eye, Inc. (Third Eye)
and Defendant Four Winds Interactive LLC (Four Winds)
executed a professional services agreement (PSA). Doc. 9,
Pl.'s First Am. Compl., ¶ 6. Under the PSA, Third
Eye promised to provide Four Winds with software support for
Four Winds's products. Id. Third Eye did not
provide the software support to Four Winds on its own.
Id. Instead, it used the services of non-party UST
Global, Inc. (UST), whose employees work in Bangalore, India.
Id. ¶ 8. Ten UST employees in Bangalore were
assigned to service Four Winds's account. Id.
¶¶ 9, 14.
2017, Third Eye sought to hire the ten UST employees working
on Four Winds's digital signs. Id. ¶ 10.
Third Eye alleges Four Winds's Director of IT convinced
the UST employees to join Third Eye's competitor, XLByte,
instead. Id. ¶ 12. And so in August 2017, the
ten UST employees rejected their Third-Eye offers and joined
XLByte. Id. ¶ 14.
September, Four Winds notified Third Eye that it was
terminating the PSA in thirty days because the ten employees
who were servicing its digital signs no longer worked for
UST. Id. Shortly after cancelling with Third Eye,
Four Winds contracted with XLByte, the employer of the ten
former UST employees who serviced Four Winds's signs.
Id. ¶ 17.
April 2018, Third Eye's CEO, Shouvik Bhattacharyya, tried
to win back Four Winds's business in an email.
Id. ¶ 21. He detailed Third Eye's
challenges moving forward without the ten UST employees and
Four Winds's business. Id. Four Winds copied
XLByte in its reply, and Third Eye alleges Four Winds thereby
shared Third Eye's confidential information with XLByte,
Third Eye's competitor, in violation of the PSA.
Id. ¶ 23.
31, 2018, Third Eye filed suit in Texas state court,
asserting claims for breach of contract and tortious
interference with contract and prospective business
relations. Doc. 1-3, Pl.'s Original Pet., ¶¶
20-36. Third Eye also sought a TRO preventing Four Winds from
further disclosing its confidential information in the April
2018 email and from using the ten former UST employees to
service its digital signs. Id. ¶ 42.
8, 2018, the day Four Winds realized this case was filed, a
Texas state judge denied the TRO orally, but Four Winds
removed the case to this Court later that day and
before the state judge entered the order denying the TRO.
Doc. 5, Pl.'s Resp., 5. The Court ordered Four Winds to
respond to Third Eye's request for a TRO by June 13, Doc.
4, which it did, Doc. 5.
hearing was scheduled for June 25, 2018 to address Third
Eye's request for a TRO. But on June 22, 2018, Third Eye
filed its first amended complaint and withdrew the request
for a TRO. Doc. 9, Pl.'s First Am. Compl., 11 n.9.
Nevertheless, the Court proceeded with the hearing and, on
the record, dismissed Third Eye's first amended complaint
sua sponte for lack of personal jurisdiction.
plaintiff bears the burden of establishing a trial
court's personal jurisdiction over each defendant.
Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir.
1985). A plaintiff need only establish a prima facie case of
jurisdiction; proof by a preponderance of the evidence is not
required. Wien Air Alaska, Inc. v. Brandt, 195 F.3d
208, 211 (5th Cir. 1999); Jones v. Petty-Ray Geophysical,
Geosource, Inc., 954 F.2d 1061, 1067 (5th Cir. 1992). In
deciding whether the plaintiff has made a prima facie case,
non-conclusory factual allegations in the complaint must be
taken as true. Gardemal v. Westin Hotel Co., 186
F.3d 588, 592 (5th Cir. 1999). The Court may also consider
“affidavits, interrogatories, depositions, oral
testimony, or any combination of the recognized methods of
discovery.” Spademan, 772 F.2d at 1192. All
conflicts between the facts contained in the parties'
affidavits and other documentation must be resolved in the
plaintiff's favor. Cent. Freight Lines, Inc. v. APA
Transp. Corp., 322 F.3d 376, 380 (5th Cir. 2003).
federal court sitting in diversity may exercise personal
jurisdiction over a nonresident defendant to the same extent
as a forum-state court. Wilson v. Belin, 20 F.3d
644, 646 (5th Cir. 1994). A Texas state court can exercise
jurisdiction over a non-resident if two preconditions are
met: (1) the nonresident must be amenable to service of
process under Texas's long-arm statute; and (2) the
assertion of jurisdiction over the nonresident must comport
with the Due Process Clause of the Constitution.
Jones, 954 F.2d at 1067. Because Texas's
long-arm statute has been held to extend to the limits of due