Raiden Commodities, LP and Aspire Commodities, LP v. Patrick De Man

CourtCourt of Appeals of Texas
DecidedJune 28, 2018
Docket01-17-00181-CV
StatusPublished

This text of Raiden Commodities, LP and Aspire Commodities, LP v. Patrick De Man (Raiden Commodities, LP and Aspire Commodities, LP v. Patrick De Man) 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
Raiden Commodities, LP and Aspire Commodities, LP v. Patrick De Man, (Tex. Ct. App. 2018).

Opinion

Opinion issued June 28, 2018

In The

Court of Appeals For The

First District of Texas ———————————— NO. 01-17-00181-CV ——————————— 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

MEMORANDUM OPINION

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

2 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.

1 The unsigned letter specified terms of employment that would be “performable in whole or in part in Harris County, Texas” and “shall be construed between the parties determined in accordance with the laws of the State of Texas.” It also stated that if a party pursued an employment-related legal action, “such action shall be commenced and prosecuted in the courts of Harris County, Texas or in the United States District Court for the Southern District of Texas.” 3 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 4. From 2010 to 2013, De Man lived in Stamford, Connecticut.

5. De Man moved to Puerto Rico in 2013, and he has lived there ever since.

6. De Man has not lived in Texas since September 2008.

7. In 2009, Adam Sinn (“Sinn”) approached De Man about the possibility of working with one of the trading companies affiliated with Sinn.

8. During the entire time that Sinn was having those discussions with De Man, De Man lived in New York or Connecticut, and De Man never set foot in Texas.

9. In 2009 and 2010, Sinn met with De Man in New York on at least five occasions and discussed the possibility of a working relationship.

10. At the time of those meetings, De Man felt that he had a job at a well-established and reputable institution, Sempra, and the thought of leaving that job to work with a Sinn-affiliated company seemed risky to him. De Man’s wife had recently given birth to his son, and Sinn sought to persuade De Man to take the risk of working with him. 11. In 2012 and part of 2013, De Man was hired by Plaintiff Aspire Commodities LP (“Aspire”) to work as a commodities trader in Connecticut, as evidenced by numerous employment documents from the State of Connecticut.

12. In 2013, De man moved to Puerto Rico, and he was subsequently described as a partner on Schedule K-1 tax forms (IRS Form 1065) for Plaintiffs Raiden Commodities LP (“Raiden”) and Aspire Commodities LP (“Aspire”).

13. All of the trading in which De Man engaged in on behalf of Raiden and Aspire was executed from outside of Texas.

5 14. Raiden was originally incorporated in the Virgin Islands, and it was incorporated there at all times prior to and including the date on which the lawsuit was filed.

15. The Schedule K-1 tax forms provided by Raiden to Sinn and De Man show that Raiden was located in the Virgin Islands and Puerto Rico.

16. The Schedule K-1 tax forms provided by Aspire to Sinn and De Man show that Aspire is located in Puerto Rico.

This interlocutory appeal followed.

Special Appearance

In their sole issue, Raiden and Aspire contend that the trial court erred in

granting De Man’s special appearance. It did not.

A. Standard of Review

Whether a court has personal jurisdiction over a nonresident defendant is a

question of law we review de novo. Moncrief Oil Int’l Inc. v. OAO Gazprom, 414

S.W.3d 142, 150 (Tex. 2013). When a defendant challenges personal jurisdiction in

a special appearance, the plaintiff bears the initial burden of pleading allegations that

bring a nonresident defendant within the provisions of the Texas long-arm statute.

Kelly v. Gen.

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