Ascend National, LLC v. Steve Ludders

CourtCourt of Appeals of Texas
DecidedFebruary 24, 2022
Docket14-20-00396-CV
StatusPublished

This text of Ascend National, LLC v. Steve Ludders (Ascend National, LLC v. Steve Ludders) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ascend National, LLC v. Steve Ludders, (Tex. Ct. App. 2022).

Opinion

Affirmed and Memorandum Opinion filed February 24, 2022.

In The

Fourteenth Court of Appeals

NO. 14-20-00396-CV

ASCEND NATIONAL, LLC, Appellant

V. STEVE LUDDERS, Appellee

On Appeal from the 151st District Court Harris County, Texas Trial Court Cause No. 2019-83833

MEMORANDUM OPINION

Ascend National, LLC appeals an order granting Steve Ludders’s special appearance and dismissing Ascend’s claims. We conclude that: (1) Ludders is not subject to personal jurisdiction in Texas under general jurisdiction principles; (2) as to certain claims, Ascend failed to plead sufficient facts establishing that Ludders is subject to personal jurisdiction under specific jurisdiction principles; and (3) the trial court did not err in impliedly finding that Ludders did not have sufficient minimum contacts to confer specific jurisdiction over Ludders for the remaining claims. Accordingly, we affirm.

Background

Ascend was a healthcare staffing company located in Houston. Chris Eales, who lives in Georgia, owns Premier Healthcare Professionals, Inc. (“PHP”) and entered into negotiations to acquire Ascend.

In November 2018, Eales signed a nondisclosure and non-solicitation agreement with Ascend. Eales agreed to maintain the confidentiality of Ascend’s commercially valuable information and to not utilize any confidential information for his own benefit. The contracting parties also agreed that the contract and each party’s obligations “shall be binding on the representatives, assigns, and successors of such party.”

Steve Ludders, a friend of Eales, runs a medical staffing business in Florida. At Eales’s request, Ludders provided advice regarding the proposed acquisition, including joining Eales during a one-day trip to Texas in January 2019 to meet with Ascend’s representatives. According to Ascend, Ludders was not only Eales’s friend but also his business partner and was provided total access to Ascend’s books, records, client files, and personnel.

Ascend and Eales were unable to reach an agreement for the acquisition. According to Ascend, following the failed deal Ludders hired one of Ascend’s employees, Linda Stafford-Haynes, “using the information gathered during the alleged due diligence phase and took over all the business that rightfully belonged to Ascend in violation of the nondisclosure agreement and numerous laws of the state of Texas.” Ludders presented evidence that Ascend “shut down” its Houston office because of lack of profit and told Stafford-Haynes to “set up a new LLC

2 asap and arrange other alternative financing for any venture [she] may choose to entail.” Ludders avers that Stafford-Haynes approached him on her own accord only after Ascend advised her to find new work and authorized her to assume control over client files.

Ascend sued Eales, PHP, and Ludders, asserting claims for fraud, breach of contract, tortious interference, conspiracy, and breach of fiduciary duty. Ascend’s general theory was that the defendants “utilized the ruse of a proposed purchase to steal Linda Stafford-Haynes and all the clientele and business associated with her without paying Ascend any money for such rights.” Ascend alleged that, “[a]t all times during the investigative process, Ludders was acting as an agent, partner, and coconspirator of Eales” and that “under Texas law their agreement created a partnership making both personally liable to Plaintiff.” Ascend generally alleged that the trial court has “both specific and general jurisdiction over each of the Defendants because the suit arises from each of the Defendants’ specific contacts which related directly to this litigation and the Defendants have maintained and do still maintain continuous and systematic contacts with the state of Texas.”

Ludders filed a special appearance and attached an affidavit, in which he averred that he is a resident of Florida, that he owns no property in Texas, and that he is not a business partner with Eales or an agent of PHP. Ludders stated that his only visit to Texas occurred in January 2019 “to meet each of [Ascend’s] branch managers,” which lasted approximately three or four hours. During that visit, Ludders received no documentation or material relevant to Ascend’s business. All other “correspondence and due diligence . . . happened remotely” outside of Texas. Ludders urged in his special appearance that he was not “at home” in Texas and therefore no Texas court could exercise general jurisdiction over him. Ludders also contended that his sole Texas contact—the January 2019 visit—was not

3 substantially related to the operative facts of the litigation and that any other allegedly tortious conduct occurred outside of Texas. Finally, Ludders stated in his affidavit that, after Ascend advised Stafford-Haynes to find new work, she called Ludders while he was in Florida to ask his assistance in starting her “own medical staffing business.” Ludders agreed to help Stafford-Haynes only after she and Ascend signed a mutual release.

Ascend filed a response to Ludders’s special appearance. Ascend contended that Ludders visited Texas to conduct due diligence for the proposed acquisition, sent numerous requests for proprietary information into Texas, received and reviewed hundreds of documents sent from Texas, and conducted and operated an ongoing business in Texas. Ascend submitted an affidavit from its managing member, Tony Brown, who testified that, at the 2019 meeting in Texas, Ludders “met with and asked for information from [Brown’s] managers, [Brown], and staff.” Brown also stated that he “[had] been told and believe[d] Ludders has hired and acquired the business of Linda Stafford-Haynes in Texas.” Ascend also attached evidence showing that Ludders requested access to certain documents stored online.

The trial court granted Ludders’s special appearance and dismissed all claims asserted by Ascend against Ludders for lack of personal jurisdiction, with prejudice as to refiling in Texas and without prejudice as to refiling in a state of proper jurisdiction.

4 Ascend timely appealed, challenging in a single issue the court’s order granting Ludders’s special appearance and dismissing Ascend’s claims against Ludders.1

Analysis

A. Personal jurisdiction framework and standard of review

Texas courts may assert in personam jurisdiction over a nonresident if (1) the Texas long-arm statute authorizes the exercise of jurisdiction, and (2) the exercise of jurisdiction is consistent with federal and state constitutional due- process guarantees. Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007). The Texas long-arm statute authorizes Texas courts to exercise jurisdiction over a nonresident defendant who “does business” in the state. See Tex. Civ. Prac. & Rem. Code §§ 17.042, 17.043. The legislature has described a non-exclusive list of acts that may constitute “doing business” in this state, such as: contracting with a Texas resident and either party is to perform the contract in whole or in part in Texas; or committing a tort in whole or in part in Texas. See id. § 17.042(1), (2). In its response to Ludders’s special appearance, Ascend argued generally that Ludders conducts and operates “ongoing businesses” within Texas, but it did not cite any particular provision of section 17.042.

The exercise of jurisdiction is consistent with federal and state constitutional due-process guarantees when (1) the nonresident defendant has minimum contacts with the forum state and (2) the assertion of jurisdiction complies with traditional notions of fair play and substantial justice. Int’l Shoe Co. v. Washington,

Related

International Shoe Co. v. Washington
326 U.S. 310 (Supreme Court, 1945)
Helicopteros Nacionales De Colombia, S. A. v. Hall
466 U.S. 408 (Supreme Court, 1984)
Moki Mac River Expeditions v. Drugg
221 S.W.3d 569 (Texas Supreme Court, 2007)
Kelly v. General Interior Construction, Inc.
301 S.W.3d 653 (Texas Supreme Court, 2010)
Spir Star AG v. Kimich
310 S.W.3d 868 (Texas Supreme Court, 2010)
American Type Culture Collection, Inc. v. Coleman
83 S.W.3d 801 (Texas Supreme Court, 2002)
BMC Software Belgium, NV v. Marchand
83 S.W.3d 789 (Texas Supreme Court, 2002)
Maritime Overseas Corp. v. Ellis
971 S.W.2d 402 (Texas Supreme Court, 1998)
Olympia Capital Associates, L.P. v. Jackson
247 S.W.3d 399 (Court of Appeals of Texas, 2008)
City of Keller v. Wilson
168 S.W.3d 802 (Texas Supreme Court, 2005)
Michiana Easy Livin' Country, Inc. v. Holten
168 S.W.3d 777 (Texas Supreme Court, 2005)
Perna v. Hogan
162 S.W.3d 648 (Court of Appeals of Texas, 2005)
Daimler AG v. Bauman
134 S. Ct. 746 (Supreme Court, 2014)
Clement Yeng v. Eve Zou and Jian Zhong Zou
407 S.W.3d 485 (Court of Appeals of Texas, 2013)
Vincent Peters v. the Top Gun Executive Group
396 S.W.3d 57 (Court of Appeals of Texas, 2013)
M & F Worldwide Corp. v. Pepsi-Cola Metropolitan Bottling Co.
512 S.W.3d 878 (Texas Supreme Court, 2017)
Old Republic Nat'l Title Ins. Co. v. Bell
549 S.W.3d 550 (Texas Supreme Court, 2018)

Cite This Page — Counsel Stack

Bluebook (online)
Ascend National, LLC v. Steve Ludders, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ascend-national-llc-v-steve-ludders-texapp-2022.