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Cunningham v. Gomez

Court of Appeals of Texas, First District

October 22, 2019

LLOYD R. CUNNINGHAM, TRUSTEE, Appellant
v.
CARLOS GOMEZ, Appellee

          On Appeal from the 269th District Court Harris County, Texas Trial Court Case No. 2016-65188

          Panel consists of Justices Lloyd, Goodman, and Landau.

          MEMORANDUM OPINION

          SARAH BETH LANDAU, JUSTICE

         Lloyd R. Cunningham, as Trustee for Cunningham Interests II, Ltd., appeals an interlocutory order granting a special appearance to Carlos Gomez, a New York resident.

         In one issue, Cunningham contends the trial court erred in granting Gomez's special appearance because the jurisdictional evidence supports a conclusion of specific jurisdiction over Gomez based on his attendance at a business meeting with Cunningham in Texas at which the two entered into a business agreement and Gomez made statements supporting Cunningham's fraud claim.

         The parties' affidavits and documentary evidence presented two incompatible versions of events. The trial court, as factfinder, had sufficient evidence and the discretion to accept one version of events and reject the other. We will not substitute our judgment for the trial court's on issues of evidentiary weight or factfinding. Accordingly, we affirm.

         Background

         Lloyd R. Cunningham, as Trustee for Cunningham Interests II, Ltd., became interested in investing in the prepaid-calling-card market. He was introduced to individuals associated with Unlimited Recharge Inc., a company that provided international long distance services through a distributor network. Cunningham avers that he met with Carlos Gomez and Johnny Rodriguez in Houston in 2011 to discuss investing in Unlimited. According to Cunningham, at the Houston meeting, Gomez claimed to be the majority owner of Unlimited. Johnny Rodriguez claimed to have a minority ownership interest in Unlimited.

         Cunningham avers that he agreed to loan Unlimited $1 million with a right to convert the loan principal into 10% equity in Unlimited. He avers that he and Rodriguez signed a convertible note in November 2011 in connection with the $1 million loan from the trust to Unlimited. Cunningham further avers that Gomez agreed to repay the trust's investment, on demand, if Cunningham ever requested he do so. [1]

         Over the next two years, Cunningham, as Trustee, loaned an additional $300, 000 to Unlimited under the terms of the 2011 convertible note, and, according to Cunningham, with the same assurances from Gomez that the loan would be repaid by Gomez, personally, on demand.

         The calling-card business was not successful. Cunningham demanded that Unlimited repay the $1.3 million loan. It did not. He demanded that Gomez repay the loan. Gomez did not either.

         In 2016, Cunningham, as Trustee, sued Unlimited and Gomez.[2] He sued Unlimited for breach of contract; he sued Gomez for breach of contract and fraud. Regarding the fraud claim, Gomez specifically alleged he relied on Gomez's agreement to repay the loan on demand in deciding to extend the loan to Unlimited.

         Gomez, who is a resident of New York, filed a special appearance. His affidavit, filed in support of his jurisdictional plea, directly disputing Cunningham's description of events. He denied that he had any ownership interest in Unlimited. He denied he met with Cunningham in Texas to discuss a loan to Unlimited. He denied he guaranteed Unlimited's debt.

         Gomez admitted he met with Cunningham in Houston once, but he averred the meeting was about the possibility of buying a boat for an unrelated business venture. Gomez argued specific jurisdiction did not exist on such a limited contact with the state unconnected to the litigation.

         Thus, the trial court was presented with party affidavits that contained irreconcilable statements of fact regarding the out-of-state defendant's contacts with the state in connection with the litigation.

         Two additional affidavits were submitted. Gomez submitted an affidavit by Rodriguez in which Rodriguez averred that he attended a meeting in Houston with Cunningham but that Carlos Gomez was not there. According to Rodriguez, the majority owner of Unlimited is Gomez's brother, Antonio Gomez. Rodriguez asserted he had no knowledge of defendant Carlos Gomez ever traveling to Texas to discuss a loan from Cunningham or guaranteeing ...


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