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Raiden Commodities, LP v. De Man

Court of Appeals of Texas, First District

June 28, 2018

RAIDEN COMMODITIES, LP AND ASPIRE COMMODITIES, LP, Appellants
v.
PATRICK DE MAN, Appellee

          On Appeal from the 125th Judicial District Harris County, Texas Trial Court Case No. 2016-59771

          Panel consists of Justices Bland, Lloyd, and Caughey.

          MEMORANDUM OPINION

          Jennifer Caughey Justice

         Raiden Commodities, LP and Aspire Commodities, LP appeal the trial court's grant of appellee Patrick De Man's special appearance. Appellants argue that De Man had sufficient relevant contacts with Texas to be subject to personal jurisdiction in Texas. He did not.

         Raiden and Aspire sought a declaration that a non-Texan who was recruited outside of Texas and performed his work outside of Texas was not a partner in either entity. Raiden and Aspire also asserted claims of conversion, misappropriation of trade secrets, and breach of the partnership agreements pertaining to alleged actions that occurred outside of Texas. The relevant parties reside in Puerto Rico and a parallel case is pending in Puerto Rico.

         Deferring to the trial court's supported findings of fact, we conclude that De Man had insufficient relevant contacts with Texas to support jurisdiction. The trial court properly granted De Man's special appearance.

         Background

         This appeal turns on De Man's contacts with Texas. De Man contends he had almost no contacts with Texas. Appellants Aspire and Raiden-two limited partnerships-disagree. The facts are as follows.

         Beginning in September 2008, De Man lived and worked in New York. At all relevant times, De Man was a citizen of the Netherlands.

         In 2009, Andrew Sinn-who was then a Texan but now resides in Puerto Rico-approached De Man about working for one of his trading companies. In 2009 and 2010, Sinn met De Man in New York at least five times to discuss working together. They did not meet in Texas during this period.

         In 2010, De Man moved to Connecticut. Sinn offered De Man employment at Aspire. Sinn sent De Man an offer letter but De Man never signed it.[1]

         In April 2011, De Man (who still lived in Connecticut) began working in Connecticut as a commodities trader for Aspire. He had no written employment agreement. Outside of Texas, De Man made trades on behalf of Aspire and, ultimately, Raiden. Raiden was formed in 2011 as a Virgin Islands limited partnership.

         In 2013, De Man moved to Puerto Rico and became an employee of Raiden Commodities 1, LLC (RC1). RC1 is a Puerto Rican LLC with its principal place of business in Dorado, Puerto Rico. It is not a party to this lawsuit. Around the time of De Man's move, Sinn also moved to Puerto Rico, where he conducted a "substantial amount of his work for the companies." In 2013, Aspire listed a Puerto Rican address on its tax forms and Raiden listed a Virgin Islands address. In 2014, both partnerships listed Puerto Rican addresses.

         After De Man joined RC1, Schedule K-1 tax forms (IRS Form 1065) for appellants Raiden and Aspire listed De Man as a partner.

         With regard to Texas travel, De Man says that he visited Texas only four times-three times in 2011 and once in 2014. He contends that all visits were five days or less and none related to the claims in this lawsuit. Aspire and Raiden contend that De Man "worked out of the Houston office physically on several occasions, including coming to Houston to interview candidates for an analyst position supporting his trades."

         In July 2016, De Man terminated his employment relationship with RC1 and demanded the distribution of alleged unpaid earnings. When the companies refused to pay him, De Man sent a demand letter and ultimately filed a lawsuit in Puerto Rico. Aspire and Raiden brought this lawsuit in Texas.

         De Man filed a special appearance in this case, contesting the trial court's personal jurisdiction over him. The trial court concluded that it lacked jurisdiction and entered the following findings of fact:

1. Patrick de Man ("De Man") lives in Dorado, Puerto Rico. At all times material to this case he was a citizen of the Netherlands.
2. After the Lehman Brothers bankruptcy in September 2008, De Man moved to New York City, New York and he lived there until 2010.
3. In October 2009, De Man Accepted a job offer with Sempra Energy Trading LLC in Stamford, Connecticut.
4. From 2010 to 2013, De Man lived in Stamford, Connecticut.
5. De Man moved to Puerto Rico in 2013, and he has lived ...

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