The State of Texas v. YELP, Inc.

Opinion

ACCEPTED 15-24-00040-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS 4/10/2025 8:54 AM CHRISTOPHER A. PRINE CLERK FILED IN 15th COURT OF APPEALS April 10, 2025 AUSTIN, TEXAS 4/10/2025 8:54:51 AM Via Electronic Filing and FedEx CHRISTOPHER A. PRINE Clerk Christopher A. Prine Clerk of Court Fifteenth Court of Appeals William P. Clements Building P.O. Box 12852 Austin, TX 78701

Re: State of Texas v. Yelp Inc., No. 15-24-00040-CV Fourth Notice of Supplemental Authority

Dear Mr. Prine:

Appellee Yelp Inc. (“Yelp”) submits this Fourth Notice of Supplemental Authority (“Notice”) concerning a recent case from the Fourteenth Court of Appeals involving similar facts and issues that arose during oral argument and that are addressed in the parties’ briefs.

Yelp respectfully requests that a copy of this Notice be provided to Chief Justice Scott Brister, Justice Scott Field, and Justice April Farris.

I. Certain Underwriters at Lloyd’s v. Henry Vogt Machine Co. Inc., No. 14-23-00590-CV, No. 14-23-00591-CV, No. 14-23-00592-CV, No. 14-23-00601-CV, 2025 WL 1033951 (Tex. App.—Houston [14th Dist.] Apr. 8, 2025, no pet. h.) (Ex. A)

In Certain Underwriters, a corporation, through its trustee, filed a petition for declaratory judgment against dozens of insurers seeking a declaration that more than 74 insurance policies would cover the costs of asbestos litigation brought against the corporation in Texas. Id. at *1. The trial court denied six special appearances filed by 11 out-of-state insurers, some of which had registered to do business in Texas under chapter 9 of the Business Organizations Code. Id. at *9- 10, 12.

On appeal, the trustee argued that by registering to do business in Texas, the insurers consented to the exercise of personal jurisdiction by Texas courts in any case filed in Texas, primarily relying on Tex. Bus. Org. Code § 9.202 and Mallory v. Norfolk Southern Railway Company, 600 U.S. 122 (2023). Id. at *4. In this case, the State of Texas (“State”) raised the same argument and relied on the same sources as the trustee. App. Br. at x, 1, 7, 12–21.

In Certain Underwriters, the Fourteenth Court of Appeals rejected the trustee’s argument and held that under the “unambiguous language” of § 9.202 and the operative case law, an entity does not consent to personal jurisdiction in Texas by registering to do business there. Id. at *8.

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The Court first explained that § 9.202, which provides that “[a] foreign nonfiling entity or a foreign filing entity registered under this chapter enjoys the same but no greater rights and privileges as the domestic entity to which it most closely corresponds,” does not provide that by registering to do business in Texas a foreign entity consents to the exercise of personal jurisdiction by any Texas court. Id. at *5. Taking the trustee’s (and the State’s) argument to its logical conclusion, a “foreign nonfiling entity,” such as a corporation formed in the Republic of Maldives, would nevertheless consent to personal jurisdiction in Texas under § 9.202, even if it only does business in that country and has not registered to do business in Texas. Id. Such an interpretation of § 9.202 is unreasonable under the statute’s “unambiguous language.” Id.

So too is the trustee’s (and the State’s) interpretation of Mallory, which is distinguishable for many reasons. Id. at *7. The Court explained that (1) Mallory does not involve chapter 9 of the Code; (2) unlike chapter 9, the Pennsylvania law at issue in Mallory specifically provided that “‘qualification as a foreign corporation’ shall permit [Pennsylvania] courts to ‘exercise general personal jurisdiction’ over a registered foreign corporation, just as they can over domestic corporations;” (3) the only issue in Mallory was whether the Pennsylvania statute violated the Due Process Clause of the U.S. Constitution; and (4) the Mallory majority expressly stated that it “need not speculate whether any other statutory scheme and set of facts would suffice to establish consent to suit.” Id. Thus, Mallary is “not on point” in determining whether a business consents to personal jurisdiction in Texas by registering to do business there. Id.

Yelp has similarly argued that Mallory does not apply for the same reasons cited by the Fourteenth Court of Appeal, among others. Yelp’s Brief at 24–36.

For the above reasons, this Court should adopt the well-reasoned analysis of the Fourteenth Court of Appeal and hold that Yelp has not consented to personal jurisdiction in Texas by registering to do business there.

Respectfully submitted,

Laura Lee Prather Partner, Haynes and Boone, LLP Laura.prather@haynesboone.com Direct Phone Number: (512) 867-8476 Direct Fax Number: (512) 867-8609

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2025 WL 1033951 Only the Westlaw citation is currently available. OPINION

NOTICE: THIS OPINION HAS NOT BEEN RELEASED Randy Wilson Justice FOR PUBLICATION IN THE PERMANENT *1 Affirmed in Part, Reversed and Remanded in Part, LAW REPORTS. UNTIL RELEASED, IT IS and Opinion filed April 8, 2025. SUBJECT TO REVISION OR WITHDRAWAL.

Court of Appeals of Texas, Houston (14th Dist.). In this consolidated appeal, 33 Lloyd's of London syndicates, 5 London Market Companies, and 9 American insurers appeal CERTAIN UNDERWRITERS AT LLOYD'S, the trial court's order denying their special appearances in a LONDON AND CERTAIN LONDON MARKET case in which the plaintiff seeks declaratory relief regarding at INSURANCE COMPANIES, AMERICAN least 74 insurance policies issued to a Kentucky corporation HOME ASSURANCE COMPANY, GENERAL between 1967 and 2014. As to the Lloyd's of London REINSURANCE CORPORATION, CENTURY syndicates, the London Market Companies, and two of the American insurers, we conclude that the trial court did not INDEMNITY COMPANY, SUCCESSOR TO CIGNA err by impliedly denying their special appearances based on SPECIALTY INSURANCE COMPANY F/K/A service-of-suit clauses in the relevant insurance policies. As CALIFORNIA UNION INSURANCE COMPANY, to the other seven American insurers, we conclude that these OAKWOOD INSURANCE COMPANY, SUCCESSOR insurers have not shown that the trial court erred to the extent TO CENTRAL NATIONAL INSURANCE COMPANY that it denied their special appearances as to declaratory- OF OMAHA, MUNICH REINSURANCE AMERICA, judgment claims regarding certain asbestos cases filed in INC., FORMERLY KNOWN AS AMERICAN Texas, and we affirm to this extent. As to the remainder of RE-INSURANCE COMPANY (IMPROPERLY the declaratory-judgment claims filed against the other seven PLEAD HEREIN AS “AMERICAN EXCESS American insurers, we conclude that the trial court erred in INSURANCE COMPANY, NOW KNOWN AS denying their special appearances, and we reverse and remand EXECUTIVE RISK INDEMNITY, INC.”), FIRST to this extent. STATE INSURANCE COMPANY, HARTFORD CASUALTY INSURANCE COMPANY, HARTFORD FIRE INSURANCE COMPANY, AND TWIN I. FACTUAL AND PROCEDURAL BACKGROUND CITY FIRE INSURANCE COMPANY, Appellants Henry Vogt Machine Co. (“Vogt”) was incorporated in v. Kentucky in 1890 and had its principal place of business in HENRY VOGT MACHINE CO., INC., BY Louisville, Kentucky. Vogt manufactured and sold various AND THROUGH ITS DULY APPOINTED products, such as valves and boilers, that required high- TRUSTEE, ROBERT L. PENDERGRAFT, Appellee temperature insulation. Starting in the early part of the twentieth century and continuing through the 1980s, Vogt NO. 14-23-00590-CV, NO. 14-23-00591-CV, included asbestos-containing component parts in these NO. 14-23-00592-CV, NO. 14-23-00601-CV products as insulating materials. In 1989 Vogt was first named | as a defendant in a lawsuit filed by a plaintiff alleging Opinion filed April 8, 2025. injury from exposure to asbestos contained in a product manufactured by Vogt. Additional lawsuits followed and On Appeal from the 11th District Court by late 2004, Vogt was named as a defendant in about Harris County, Texas 975 separate lawsuits filed by a total of about 59,000 plaintiffs in 16 states. By September 2012 those numbers Trial Court Cause No. 2004-03964 (MDL Cause No.) grew to approximately 2,000 lawsuits filed by about 10,800

Panel consists of Chief Justice Christopher and Justices plaintiffs 1 in 30 states, and Vogt filed a bankruptcy petition Wilson and Bridges.

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in the United States Bankruptcy Court for the Western District (2) Munich Reinsurance America, Inc., formerly known of Kentucky (“Bankruptcy Case”). as American Re-insurance Company, claiming that it was improperly sued as “American Excess Insurance Company, In December 2014 the bankruptcy judge signed an order now known as Executive Risk Indemnity, Inc.” (“Munich”); approving Vogt's Chapter 11 amended plan of liquidation (3) American Home Assurance Company (“American (“Plan”). The Plan provided for a “Creditor's Trust” meaning Home”); (4) Century Indemnity Company, successor to “a trust established for the benefit of the Unsecured Tort Cigna Specialty Insurance Company, f/k/a California Union Creditors and which will be administered by a Trustee Insurance Company (“Century”); (5) Oakwood Insurance designated by [the Provost, Umphrey, LLP law firm], and Company, successor to Central National Insurance Company into which the Insurance Policies and all associated claims, of Omaha (“Oakwood”); (6) First State Insurance Company rights and property interests of every kind and nature will be (“First State”); (7) Hartford Casualty Insurance Company assigned.” The Plan provides that on its effective date “the (“Hartford Casualty”); (8) Hartford Fire Insurance Company Insurance Policies and all associated rights thereto shall vest (“Hartford Fire”); (9) Twin City Fire Insurance Company in the Creditors' Trust, free and clear of Liens, claims and (“Twin City”); (10) General Reinsurance Corporation encumbrances and the Debtor shall be deemed without further (“General Re”); (11) Certain Underwriters at Lloyd's, action to have assigned the assets and property interests London, Syndicate Numbers 035, 056, 090, 099, 126, 160, comprising the Insurance Policies to the Creditors' Trust free 175, 205, 210, 243, 250, 276, 279, 346, 365, 404, 408, and clear of any and all liens, claims and encumbrances.” 452, 471, 506, 510, 518, 553, 604, 618, 620, 661, 694, As of the Plan's effective date “the Creditors' Trust and/or 701, 918, 948, 989, 1071 (collectively the “Underwriters”); the [Trustee for the Creditors' Trust] shall be vested and and (12) Certain London Market Companies: Assicurazioni automatically be conferred with, and have all of the power, Generali, Catalina Worthing Insurance Ltd. f/k/a HFPI (as authority and standing, and shall be the sole authorized Person Part VII transferee of Excess Insurance Company Ltd. and/or with such authority and standing, to take any and all actions London & Edinburgh Insurance Company Ltd. as successor that were previously vested in the Debtor or the Estate with to London & Edinburgh General Insurance Company respect to the Insurance Policies and shall [ ] automatically be Ltd.), Dominion Insurance Company Ltd., Unionamerica conferred with and have authority and standing, and shall be (as statutory successor in interest to certain business of the sole authorized Person with authority and standing, to take St. Paul Travelers Insurance Company Limited, formerly any and all actions that were previously vested in the Debtor, known as St. Paul International Insurance Company Limited or the Estate and stand in the same position as the Debtor or and St. Katherine Insurance Company PLC), Tenecom the estate with respect to any claim the Debtor may have to Limited (successor to Winterthur Swiss Insurance Company, the Insurance Policies.” formerly Accident & Casualty Insurance Company), and Tenecom Limited (f/k/a Yasuda Fire & Marine Insurance *2 The Plan provided that upon entry of an order of the Company (UK) Limited and Yasuda Fire & Marine Insurance Bankruptcy Court closing the Chapter 11 Case, and without Company of Europe Limited) (collectively the “London any need for any further actions or approvals, Vogt would Market Companies”). be deemed formally dissolved, wound-down, and liquidated pursuant to Kentucky Revised Statutes Chapter 271B.14 and The term “Asbestos Suits,” as used in the Petition, means other applicable law. An order of the Bankruptcy Court “[c]laims, suits, actions, causes of action, and demands [that] closing the Bankruptcy Case was entered in 2015. The have been asserted against [Vogt] and [that] likely will be Kentucky Secretary of State administratively dissolved Vogt asserted against Vogt in the future, alleging exposure to in 2016 based on Vogt's failure to file its 2016 annual report. materials or products allegedly containing or incorporating elements, minerals, or other substances, including without On March 16, 2023, appellee/plaintiff Henry Vogt Machine limitation asbestos and other materials contained in, used Co., Inc., by and through its duly appointed trustee, with, or associated with products allegedly manufactured, Robert L. Pendergraft (“Trustee”) filed “Plaintiff's Original sold, or distributed by [Vogt], which suits arise out of single Petition for Declaratory Judgment” (“Petition”) seeking cause of causative agency (collectively “All Asbestos Suits”). only nonmonetary, declaratory relief against the following In the Petition the Trustee asserts that Vogt has insurance defendants: (1) Republic Insurance Company, now known policies that remain responsive to All Asbestos Suits and as Starr Indemnity & Liability Company (“Republic”); that he seeks declarations “making these policies and their

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limits of liability fully available to meet Vogt's defense and Whether each of the appellants is subject to personal indemnity costs in [All Asbestos Suits], as those terms are jurisdiction in Texas is a question of law subject to de novo understood in the insurance business.” The Trustee lists 74 review. See BMC Software Belgium, N.V. v. Marchand, 83 insurance policies issued by one or more of the defendants S.W.3d 789, 794 (Tex. 2002). The trial court did not issue between 1967 and 2014, and the Trustee alleges that each any findings of fact or conclusions of law. Therefore, all facts of the policies is “responsive to [All Asbestos Suits].” The necessary to support the trial court's ruling and supported by Trustee alleges that he has satisfied, will be deemed to have the evidence are implied in favor of the trial court's decision. satisfied, or has been or will be relieved from satisfying Id. at 795. The Insurers can challenge the legal and factual all terms and conditions of these 74 policies, including sufficiency of these implied factual findings. Id. In conducting without limitation payment of premiums, satisfaction or relief a legal-sufficiency analysis, we review the evidence in the from satisfying all deductibles, self-insured retentions, and light most favorable to the challenged finding and indulge underlying limits of these policies, and that the Trustee is every reasonable inference that would support it. See City entitled to the full benefit of the insurance. of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex. 2005). We must credit favorable evidence if a reasonable factfinder could *3 The Multidistrict Litigation Panel transferred this case and disregard contrary evidence unless a reasonable factfinder to the 11th Judicial District Court of Harris County as a tag- could not. See id. at 827. We must determine whether the along case to Cause No. 2004-03964 pending before Judge evidence at trial would enable reasonable and fair-minded Mark Davidson. Republic, a Texas corporation, answered people to find the facts at issue. See id. The factfinder is the and did not file a special appearance. Appellees/defendants sole judge of the credibility of the witnesses and the weight First State, Hartford Casualty, Hartford Fire, and Twin City of their testimony. See id. at 819. (collectively the “Hartford Parties”) filed a special appearance with attached evidence. Appellees/defendants Century and Oakwood (collectively the “Century Parties”) filed a special III. ISSUE AND ANALYSIS appearance with attached evidence. Appellees/defendants Munich, American Home, and General Re each filed a special On appeal each of the Insurers argues that the trial court appearance with attached evidence. Appellees/defendants erred in denying its respective special appearance. The the Underwriters and the London Market Companies Texas long-arm statute allows a court to exercise personal (collectively the “London Market Insurers”) filed a special jurisdiction as far as the federal constitutional requirements appearance with attached evidence. of due process will permit. See Tex. Civ. Prac. & Rem. Code Ann. §§ 17.041–.045 (West, Westlaw through 2023 The Trustee filed a single “Omnibus Response” in opposition 4th C.S.); BMC Software, 83 S.W.3d at 795. The plaintiff to the six special appearances, along with attached evidence. bears the initial burden to plead allegations sufficient to Various defendants filed replies to the Trustee's response, and bring the nonresident defendant within the reach of the the Trustee filed a supplemental opposition to the special Texas long-arm statute. See Old Republic Nat'l Title Ins. Co. appearances. The trial court signed an order denying the six v. Bell, 549 S.W.3d 550, 559 (Tex. 2018). If the plaintiff special appearances. does so, the defendant then bears the burden to negate all bases of personal jurisdiction alleged by the plaintiff. Id. The Century Parties, Munich, the London Market Insurers, The plaintiff may plead allegations regarding the long-arm American Home, General Re, and the Hartford Parties statute or allege bases of personal jurisdiction in either the (collectively the “Insurers”) timely filed four separate plaintiff's live petition or in a response in opposition to the interlocutory appeals from the trial court's denial of their special appearance. See Washington DC Party Shuttle, LLC respective special appearances. See Tex. Civ. Prac. & Rem. v. IGuide Tours, 406 S.W.3d 723, 738 (Tex. App.—Houston Code Ann. § 51.014(a)(7) (West, Westlaw through 2023 4th [14th Dist.] 2013, pet. denied) (en banc); Max Protetch, Inc. C.S.). This court consolidated the four appeals for purposes v. Herrin, 340 S.W.3d 878, 883 (Tex. App.—Houston [14th of briefing and submission on appeal. Dist.] 2011, no pet.). The defendant may negate personal jurisdiction on either a factual or legal basis. The defendant may present evidence that contradicts the plaintiff's factual II. STANDARD OF REVIEW allegations supporting the assertion of personal jurisdiction, and the plaintiff may then respond with its own evidence

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supporting its allegations. See Horowitz v. Berger, 377 S.W.3d jurisdiction. The Trustee did not allege in the trial court that by 115, 121 (Tex. App.—Houston [14th Dist.] 2012, no pet.). registering to do business in Texas under chapter 9 of the Code Or the defendant may show that even if the plaintiff's alleged any of the Insurers had impliedly consented to the exercise of facts are true, the evidence is legally insufficient to establish personal jurisdiction over them by Texas courts. personal jurisdiction. Old Republic Nat'l Title Ins. Co., 549 S.W.3d at 559. The Trustee relies on Mallory v. Norfolk Southern Railway Company, 600 U.S. 122 (2023) in making the argument that by registering to do business in Texas a corporation A. By registering to do business in Texas under impliedly consents to the exercise of personal jurisdiction chapter 9 of the Business Organizations Code did over the corporation by Texas courts in any case filed in some of the Insurers impliedly consent to the exercise Texas (“Implied Consent Argument”). Though Mallory was of personal jurisdiction over them by Texas courts in decided on June 27, 2023, the Implied Consent Argument all cases filed in Texas? existed before that date and before the Trustee filed this *4 Consent is an established basis for a trial court to suit in March of 2023. Thus, the Implied Consent Argument exercise personal jurisdiction consistent with due process, was available to the Trustee when he made his allegations and a variety of legal arrangements have been taken to regarding personal jurisdiction. Nonetheless, we presume, represent express or implied consent to the trial court's without deciding, that the Trustee's allegation that certain exercise of personal jurisdiction. See Insurance Corp. of defendants had registered to do business in Texas was Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. sufficient to allege the Implied Consent Argument, and we 694, 703–04 (1982). On appeal the Trustee argues that by now address the merits of this argument. registering to do business in Texas under chapter 9 of the Business Organizations Code (“Code”) Munich, American The Implied Consent Argument relies on Section 9.202, Home, Century, Oakwood, General Re, Hartford Casualty, which, according to the Trustee, explicitly states that Texas Hartford Fire, and Twin City (collectively the “Registered requires out-of-state corporations to consent to suit in Texas Insurers”) impliedly consented to the exercise of personal on any and all claims as a condition of doing business jurisdiction over them by Texas courts in any case filed in in Texas. See Tex. Bus. Organs. Code Ann. § 9.202. The Texas. See Tex. Bus. Organs. Code Ann. § 9.001, et seq. parties have not cited and research has not revealed any case (West, Westlaw through 2023 4th C.S.). The Trustee contends addressing whether the Trustee's interpretation of Section that section 9.202 of the Code (“Section 9.202”) explicitly 9.202 is correct. In construing a statute, our objective is to states that Texas requires out-of-state corporations to consent determine and give effect to the Legislature's intent. See Nat'l to suit in Texas courts on any and all claims as a condition Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex. of doing business in Texas. See id. § 9.202 (West, Westlaw 2000). If possible, we must ascertain that intent from the through 2023 4th C.S.). language the Legislature used in the statute and not look to extraneous matters for an intent the statute does not state. Id. We first address whether the Trustee alleged this basis of If the meaning of the statutory language is unambiguous, we personal jurisdiction in the trial court and whether we should adopt the interpretation supported by the plain meaning of the address the argument on appeal. The Insurers only had to provision's words. St. Luke's Episcopal Hosp. v. Agbor, 952 negate the bases of personal jurisdiction that the Trustee S.W.2d 503, 505 (Tex. 1997). We must not engage in forced alleged against them. See Old Republic Nat'l Title Ins. Co., or strained construction; instead, we must yield to the plain 549 S.W.3d at 559. The Insurers and this court need not sense of the words the Legislature chose. See id. address any potential basis of personal jurisdiction not alleged by the Trustee in the trial court. See Trigeant Holdings, Ltd. *5 To transact business in Texas foreign corporations must v. Jones, 183 S.W.3d 717, 721, n.1 (Tex. App.—Houston register under chapter 9 of the Code. See Tex. Bus. Organs. [1st Dist.] 2005, pet. denied). The only allegation the Trustee Code Ann. § 1.002(28) (West, Westlaw through 2023 4th made in the Petition about the registration of the Registered C.S.); § 9.201(a) (West, Westlaw through 2023 4th C.S.). Insurers was that the insurer “is registered to do business The Registered Insurers are foreign corporations that have in Texas and may be served with process through its agent, registered to do business in Texas; thus each of them is a [reciting the respective name and address of the defendant's foreign filing entity as that term is used in chapter 9. See Tex. agent for service of process in Texas].” These allegations Bus. Organs. Code Ann. § 1.002(29) (West, Westlaw through appear to address service of process, not consent to personal

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2023 4th C.S.) (defining “foreign filing entity” as “a foreign business in Texas consent to the exercise of personal entity, other than a foreign limited liability partnership, jurisdiction over them by any Texas court in any Texas case; that registers or is required to register as a foreign entity or (2) foreign entities that do not transact any business in under Chapter 9”). Section 9.202 provides that “[a] foreign Texas and that are not registered to do business in Texas nonfiling entity or a foreign filing entity registered under this consent to the exercise of personal jurisdiction over them by chapter enjoys the same but no greater rights and privileges as any Texas court in any Texas case. 3 Under its unambiguous the domestic entity to which it most closely corresponds.” Id. language, Section 9.202 does not provide that foreign entities § 9.202. The Trustee argues that under Section 9.202 foreign consent to the exercise of personal jurisdiction over them by filing entities registered under chapter 9 are subject to general Texas courts in any suit filed in Texas as a condition of doing jurisdiction in lawsuits filed in Texas courts because domestic business in Texas or as a consequence of having registered to entities are subject to general jurisdiction in these cases and do business in Texas under chapter 9. See Tex. Bus. Organs. foreign filing entities enjoy the same rights and privileges as Code Ann. § 9.202; Morris v. Kansas City Ry., No. 2:24- domestic entities. We disagree. CV-00018-JRG, 2024 WL 3347379, at *3–4 (E.D. Tex. Jul. 8, 2024) (holding that a foreign entity does not impliedly Section 9.202 applies to both foreign nonfiling entities and consent to the exercise of personal jurisdiction over the entity foreign filing entities. See id. Section 9.202 does not provide in Texas courts by registering to do business in Texas); iMed that by registering to do business in Texas a foreign entity Tech., Inc. v. Teleflex, Inc., No. 3:19-CV-1861-(BK), 2020 consents to the exercise of personal jurisdiction by any WL 2106354, at *4 (N.D. Tex. Apr. 13, 2020); (holding that Texas court. The definition of “foreign filing entity” includes the mere fact that two foreign corporations are registered to do foreign entities that are required to register because they business in Texas does not confer on Texas courts the ability transact business in Texas but that have not registered. See to exercise personal jurisdiction over these corporations); Tex. Bus. Organs. Code Ann. §§ 1.002(29), 9.201(a). If Repairify, Inc. v. Opus IVS, Inc., No. 05-23-00921-CV, 2024 having the same rights and privileges as a domestic entity WL 2205663, at *1 (Tex. App.—Dallas May 16, 2024, no meant that all foreign filing entities consented to the exercise pet.) (holding that by registering to do business in Texas a of personal jurisdiction over them by Texas courts in any case foreign corporation did not consent to the exercise of personal filed in Texas, then all foreign entities that have done any jurisdiction over the corporation by Texas courts based on business in Texas, no matter how small the amount, would general jurisdiction). be deemed to have consented to the exercise of personal jurisdiction over them by Texas courts in any case filed *6 Having reviewed the entirety of chapter 9 of the Code, in Texas, even as to cases not based on the entities' Texas we conclude that, under its unambiguous language, chapter 9 business contacts and no matter how limited their Texas does not provide that foreign entities consent to the exercise contacts. See id. § 1.002(29), 9.001, 9.202. of personal jurisdiction over them by Texas courts in any suit filed in Texas as a condition of doing business in Texas In addition, if having the same rights and privileges as a or as a consequence of having registered to do business in domestic entity meant that all foreign filing entities consented Texas under chapter 9. See Tex. Bus. Organs. Code Ann. to the exercise of personal jurisdiction over them by Texas § 9.001, et seq. Thus, a foreign entity's registration to do courts in any case filed in Texas, it would have the same business in Texas under chapter 9 does not constitute an meaning for foreign nonfiling entities. A “foreign entity” express or implied consent by the entity to the exercise of means any organization formed under or governed by the laws personal jurisdiction over the foreign entity in any case. See of a jurisdiction other than Texas. See id. § 1.002(28). Thus, Tex. Bus. Organs. Code Ann. § 9.001, et seq.; Morris, 2024 under the Trustee's interpretation, a corporation formed in WL 3347379, at *3–4; iMed Tech., Inc., 2020 WL 2106354, the Republic of Maldives, 2 that only does business in that at *4; Repairify, Inc., 2024 WL 2205663, at *1. country and has not registered to do business in Texas, has nevertheless consented to personal jurisdiction in Texas under In support of his Implied Consent Argument the Trustee relies Section 9.202. See id. § 1.002(31), 9.001, 9.202. on Goldman v. Pre-Fab Transit Company, a case in which this court held that under article 8.02 of the former Texas Business It would not be reasonable to interpret Section 9.202 Corporations Act (“Article 8.02”), in return for the privilege as providing that (1) foreign entities transacting minimal of doing business in Texas and enjoying the same rights amounts of business in Texas and not registering to do and privileges as a Texas corporation, foreign corporations

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impliedly consented to the exercise of personal jurisdiction Corporations Act expired. See Phillips v. United Heritage over them in all lawsuits against them in Texas courts. See 520 Corp., 319 S.W.3d 156, 163, n.5 (Tex. App.—Waco 2010, S.W.2d 597, 598 (Tex. Civ. App.—Houston [14th Dist.] 1975, no pet.). The first part of Article 8.02 of the Texas Business no writ). The First Court of Appeals agreed with the Goldman Corporation Act, which contains some language similar to holding in Acacia Pipeline Corp. v. Champlin Exploration, that in Section 9.202, provided as follows: Inc. See 769 S.W.2d 719, 719–20 (Tex. App.—Houston [1st Dist.] 1989, no writ). Other courts disagreed with Goldman. See, e.g., Leonard v. USA Petroleum Corp., 829 F.Supp. 882, *7 A foreign corporation which shall 887 (S.D. Tex. 1993) (disagreeing with Goldman); Asshauer have received a certificate of authority v. Glimcher Realty Trust, 228 S.W.3d 922, 933 (Tex. App. under this Act shall, until its certificate —Dallas 2007, no pet.) (disagreeing with Goldman holding). of authority shall have been revoked in The parties have not cited and research has not revealed a accordance with the provisions of this case in which the Supreme Court of Texas has resolved this Act or until a certificate of withdrawal conflict. shall have been issued by the Secretary of State as provided in this Act, enjoy The Insurers point to the following statements in the plurality the same, but no greater, rights and opinion in Conner v. ContiCarriers & Terminals, Inc.: privileges as a domestic corporation “Goldman, however, is unsupported by any relevant case organized for the purposes set forth in law, and we find it is in conflict with binding U.S. Supreme the application pursuant to which such Court precedent. We find Goldman, therefore, to be wrongly certificate of authority is issued.... decided.” 944 S.W.2d 405, 416 (Tex. App.—Houston [14th Dist.] 1997, no writ) (plurality op.). Although some of the Insurers attribute these statements to this court and although See Act of Mar. 30, 1955, 54th Leg., R.S., ch. 64, art. 8.02, the plurality opinion uses the pronoun “we,” these statement 1955 Tex. Gen. Laws 239, 296, amended (1975, 1985, 1989), were made by a single justice in a plurality opinion and thus expired Jan. 1, 2010, Act of May 13, 2003, 78th Leg., R.S., ch. are not statements by this court. See id. at 409, 416, 420. Even 182, § 2, 2003 Tex. Gen. Laws 267, 595 (formerly codified if these statements were made in a unanimous panel opinion, at Tex. Bus. Corp. Act Ann. art. 8.02). This statute differs the Conner panel had no authority to overrule Goldman; only in various respects from Section 9.202. Most significantly, the en banc court has that authority. See Mitschke v. Borromeo, neither Article 8.02, nor any other part of the Texas Business 645 S.W.3d 251, 256 (Tex. 2022); Glassman v. Goodfriend, Corporations Act made Article 8.02 applicable to foreign 347 S.W.3d 772, 781 (Tex. App.—Houston [14th Dist.] 2011, corporations that have not transacted any business in Texas pet. denied) (en banc). Thus, the Conner plurality opinion and that have not received a certificate of authority to do did nothing to diminish the Goldman opinion's status as a business in Texas under the Texas Business Corporations Act. binding precedent in this court. See Mitschke, 645 S.W.3d at See id. Section 9.202 applies to foreign entities that do not 256; Glassman, 347 S.W.3d at 781. transact any business in Texas and that are not registered to do business in Texas. See Tex. Bus. Organs. Code Ann. § Under the doctrine of horizontal stare decisis, whether or not 9.202. We conclude that the enactment of the Code, including we agree with the Goldman holding, this court is bound to Section 9.202 was an intervening and material change in the apply that holding absent (1) a decision from the Supreme statutory law. See Taylor v. First Cmty. Credit Union, 316 Court of the United States, the Supreme Court of Texas, or S.W.3d 863, 869 (Tex. App.—Houston [14th Dist.] 2010, no this court sitting en banc which is on point and contrary pet.). Therefore, the Goldman holding is not on point, and we to the Goldman holding; or (2) an intervening and material are not bound to apply that holding in this case. See Mitschke, change in the statutory law. See Mitschke, 645 S.W.3d at 256; 645 S.W.3d at 256; Glassman, 347 S.W.3d at 781. Glassman, 347 S.W.3d at 781. The Goldman court interpreted and applied the Texas Business Corporations Act; it did not The Trustee also relies on the decision of the Supreme Court interpret chapter 9 of the Code. See Goldman, 944 S.W.2d at of the United States in Mallory v. Norfolk Southern Railway 416. The Code became applicable to some business entities Company. See 600 U.S. 122 (2023). According to the Trustee, starting on January 1, 2006, and to all business entities starting Mallory establishes that by registering to do business in on January 1, 2010, the date on which the Texas Business Texas the Registered Insurers impliedly consented to personal

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jurisdiction in Texas. That is not correct. Mallory did not arm statute, and each of the Insurers showed that it is not a involve chapter 9 of the Code. See id. at 134. Similar to Texas resident. Numerous precedents state that the plaintiff chapter 9 of the Code, the Pennsylvania law involved in bears the initial burden to plead allegations sufficient to bring Mallory provided “that an out-of-state corporation ‘may not the nonresident defendant within the reach of the Texas long- do business in this Commonwealth until it registers with’ arm statute. See, e.g., Old Republic Nat'l Title Ins. Co., 549 the Department of State.” Id. (quoting 15 Pa. Cons. Stat. § S.W.3d at 559. None of the Insurers was served under the 411(a)). Unlike chapter 9, Pennsylvania has a statute that Texas long-arm statute. Instead, the Insurers were served with expressly states that “ ‘qualification as a foreign corporation’ process by either serving their registered agent for service shall permit [Pennsylvania] courts to ‘exercise general of process in Texas or by serving the Texas Commissioner personal jurisdiction’ over a registered foreign corporation, of Insurance as the insurer's agent for service of process. just as they can over domestic corporations.” Id. (quoting See Tex. Bus. Organs. Code Ann. § 5.201 (West, Westlaw 42 Pa. Cons. Stat. § 5301(a)(2)(i)). The Supreme Court of through 2023 4th C.S.); Tex. Ins. Code Ann §§ 804.103(c), the United States lacks authority to interpret state statutes; 804.201, et seq. (West, Westlaw through 2023 4th C.S.); instead the only issue before the high court in Mallory was Ehde v. RPM Dining, LLC, No. 1:22-CV-00870-RP, 2023 whether these Pennsylvania statutes violated the Due Process WL 11915730, at *2 (W.D. Tex. Jun. 22, 2023); Dorsett v. Clause of the United States Constitution. See id. at 125–26. Centene Corp., No. 4:22-CV-0057, 2022 WL 17069880, at In Mallory five justices rejected Norfolk Southern's argument *2 (S.D. Tex. Oct. 26, 2022); American Access Cas. Co. v. that these Pennsylvania statutes violated the Due Process Alcantar, No. 01-17-00707-CV, 2018 WL 1801658, at *2 Clause. See id. at 135–36. Justice Alito wrote separately (Tex. App.—Houston [1st Dist.] Apr. 17, 2018, no pet.). The joining four of his colleagues only as to Parts I and III–B of parties have not cited and research has not revealed a case Justice Gorsuch's opinion. See id. at 163 (Alito, J., concurring addressing whether the plaintiff bears the burden to plead in part and concurring in the judgment). The Mallory majority sufficient allegations regarding the long-arm statute as to noted that Norfolk Southern “concedes that it registered to do nonresident defendants who are served with process under a business in Pennsylvania, that it established an office there to statute other than the long-arm statute. Serving a defendant receive service of process, and that in doing so it understood with process affords a means for the trial court to exercise it would be amenable to suit on any claim.” Id. at 135. The personal jurisdiction over the defendant. See City of Tyler Mallory majority stated that “[t]o decide this case, we need v. Beck, 196 S.W.3d 784, 786–87 & n.1 (Tex. 2006). But not speculate whether any other statutory scheme and set of if a defendant is served with process under the Business facts would suffice to establish consent to suit.” Id. Mallory Organizations Code or under the Insurance Code, it is not is not on point in our analysis of chapter 9 of the Code. See clear why a plaintiff would have to plead allegations sufficient Morris, 2024 WL 3347379, at *3–4; Repairify, Inc., 2024 WL to support service of process under the Texas long-arm statute. 2205663, at *1. See Leach v. City Nat'l Bank, 733 S.W.2d 578, 580–81 (Tex. Civ. App.—San Antonio 1987, no writ) (holding, in appeal *8 As a matter of law and under the unambiguous language from default judgment, that compliance with long-arm statute of Section 9.202 and chapter 9 of the Code, by registering was unnecessary because defendant was served under Texas to do business in Texas the Registered Insurers did not Rule of Civil Procedure 106(b)(2), not under the long-arm impliedly consent to the exercise of personal jurisdiction over statute). Nonetheless, we presume that the Trustee had the them by Texas courts in all cases filed in Texas. 4 See Tex. initial burden to plead allegations sufficient to bring the Bus. Organs. Code Ann. § 9.001, et seq.; Morris, 2024 WL Insurers within the reach of the Texas long-arm statute. 3347379, at *3–4; iMed Tech., Inc., 2020 WL 2106354, at *4; Repairify, Inc., 2024 WL 2205663, at *1. *9 A plaintiff may plead allegations regarding the long-arm statute in either the plaintiff's live petition or in a response in opposition to the special appearance. See Max Protetch, Inc., B. Did the Trustee plead sufficient allegations to bring 340 S.W.3d at 883. In his response the Trustee alleged that the the Insurers within the Texas long-arm statute? London Market Insurers, Munich, and Century (collectively We now consider whether the Insurers were entitled to have the “SOS Insurers”) consented to the trial court's exercise of the Trustee's claims dismissed for lack of personal jurisdiction personal jurisdiction over them and expressly waived their because the Trustee did not plead sufficient allegations to right to contest personal jurisdiction through the service- bring any of the Insurers within the reach of the Texas long- of-suit clauses in their respective insurance policies. The

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Trustee asserted that American Home, Hartford Casualty, chosen by the plaintiff anywhere in the United States. Hartford Fire, and Twin City have consented to the trial By means of these clauses the SOS Insurers consented court's exercise of personal jurisdiction over them by their to the trial court's ability to exercise personal jurisdiction “extensive, systematic business conduct in [Texas] over many over them, agreed to comply with all requirements years.” The Trustee also contended that (1) the trial court necessary to give the trial court jurisdiction, and agreed may exercise personal jurisdiction over the Insurers based on that all matters pertinent to the instant dispute shall be specific jurisdiction because the scope of the risks insured determined by the trial court. under each policy, the Insurers' obligations to defend Vogt wherever claims are brought, and the Trustee's requests for • Specific Jurisdiction as to Each of the Insurers. The declaratory relief regarding cases filed in Texas by Texas trial court may exercise personal jurisdiction over each residents; and (2) the exercise of personal jurisdiction over of the Insurers based on specific jurisdiction because the Insurers comports with traditional notions of fair play and of “(1) the scope of risks insured under the Insurers' substantial justice. policies (including the Insurers' defense obligations to [Vogt], wherever claims are brought) and (2) the nexus The Supreme Court of Texas has stated that the “Texas between Texas and the claims against [Vogt].” Vogt long-arm statute reaches ‘as far as the federal constitutional has been and continues to be a defendant in multiple requirements of due process will allow.’ Thus, the Texas asbestos lawsuits filed in Texas, by Texans, alleging long-arm statute requirements are satisfied if exercising injurious exposure to asbestos in Texas. The Trustee is jurisdiction comports with federal due process limitations.” a Texas resident who filed this suit in Texas to fulfill American Type Culture Collection, Inc., 83 S.W.3d 801, his duty to marshal the Vogt assets and settle the claims 806 (Tex. 2002) (citations omitted); accord Vosko v. Chase of asbestos claimants and their families, some of whom Manhattan Bank, N.A., 909 S.W.2d 95, 98 (Tex. App.— live in Texas. The trust agreement for the Creditors' Trust Houston [14th Dist.] 1995, writ denied). The Trustee alleged contains a choice of law provision providing that the that some of the Insurers consented to the trial court's exercise agreement be interpreted under Texas law. A number of personal jurisdiction based on service-of-suit clauses or of the asbestos suits include underlying plaintiffs who by extensive and systematic business conduct in Texas. are Texas citizens and who allege asbestos exposure in The Trustee also alleged that the trial court may exercise Texas. According to the Trustee, a significant portion of personal jurisdiction over all the Insurers based on specific Vogt's asbestos liabilities arise in Texas. jurisdiction. If these allegations are correct, then the trial *10 • General Jurisdiction as to Four of the Insurers. court's exercise of personal jurisdiction over Munich would The trial court may exercise personal jurisdiction over comport with federal due process limitations. See Insurance American Home, Hartford Casualty, Twin City, and Corp. of Ireland, Ltd., 456 U.S. at 703–04; Guardian Royal Hartford Fire (collectively the “Four Insurers”) based Exch. Assur., Ltd. v. English China Clays, P.L.C., 815 S.W.2d on general jurisdiction because from 2018 through 2022 223, 227–28, 230–32 (Tex. 1991). Therefore, the Trustee these insurers earned premiums in Texas in “eight or satisfied any burden he had to plead sufficient allegations to nine figure amounts.” The Trustee submitted documents bring the Insurers within the Texas long-arm statute, and the showing the premiums earned in Texas by the Four burden shifted to each of the Insurers to negate all bases of Insurers during this time period. The Trustee asserted personal jurisdiction that the Trustee alleged against the party that the Four Insurers are subject to the trial court's in question. See Old Republic Nat'l Title Ins. Co., 549 S.W.3d jurisdiction based on their “continuous and systematic” at 559; M-I, L.L.C. v. California Res. Corp., No. 14-22-00934- connections with Texas, including their status as repeat CV, 2024 WL 2150094, at *2 (Tex. App.—Houston [14th participants in the Texas judicial system. Dist.] May 14, 2004, no pet.). In the trial court the Trustee alleged the following bases of personal jurisdiction in his petition or in his omnibus response in opposition to the special C. Did some of the Insurers expressly consent to the appearances: exercise of personal jurisdiction over them by the trial court through service-of-suit clauses contained in the • Service-of-Suit Clauses as to the SOS Insurers. insurance policies they issued? The SOS Insurers have service-of-suit clauses in their One of the bases of personal jurisdiction alleged by the policies under which these insurers expressly waived Trustee in the trial court was that the SOS Insurers have the right to contest personal jurisdiction in any court

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service-of-suit clauses in their insurance policies under which these insurers expressly waived the right to contest personal *11 The Century and Munich policies have substantially jurisdiction in any court chosen by the plaintiff anywhere similar service-of-suit clauses. 7 A court generally interprets in the United States. The Trustee raised the service-of-suit an insurance policy under the same rules of construction that clauses as a basis for personal jurisdiction in the Petition apply to any other contract. Balandran v. Safeco Ins. Co. as to the London Market Insurers and in his response as of Am., 972 S.W.2d 738, 740–41 (Tex. 1998). Applying the to SOS Insurers. 5 By means of these clauses the Trustee ordinary rules of contract construction to insurance policies, argues that the SOS Insurers expressly consented to the trial the reviewing court ascertains the parties' intent by looking court's ability to exercise personal jurisdiction over them in only to the four corners of the policy to see what is actually any court chosen by the plaintiff, agreed to comply with all stated and does not consider what allegedly was meant. Fiess requirements necessary to give the trial court jurisdiction, v. State Farm Lloyds, 202 S.W.3d 744, 747 (Tex. 2006); and agreed that all matters pertinent to the instant dispute Williams Consolidated I, Ltd./BSI Holdings, Inc. v. TIG Ins. shall be determined by the trial court. Either in their Co., 230 S.W.3d 895, 902 (Tex. App.—Houston [14th Dist.] special appearances or in their replies, the London Market 2007, no pet). If a court can ascertain only one reasonable Insurers and Century sought to negate this basis for personal meaning of the policy provision, the insurance contract is not jurisdiction by arguing that for the service-of-suit clauses to ambiguous, and the court will enforce it as written. See Fiess, apply there must be a failure of the insurer to pay an amount 202 S.W.3d at 746; State Farm Fire & Cas. Co. v. Vaughan, claimed to be due under the policy and that the Trustee had not 968 S.W.2d 931, 933 (Tex. 1998). alleged any such failure. We presume for the sake of argument that Munich also made this argument in the trial court. Under the unambiguous language of these clauses, the respective insurer consents to the exercise of personal On appeal the London Market Insurers and Century argue that jurisdiction over the insurer by any court of competent the service-of-suit clauses do not apply because the Trustee jurisdiction in the United States as to “all matters arising” has not alleged a failure of the insurer to pay an amount under the respective policy if (1) the insurer has failed to claimed to be due under the policy. We presume for the sake pay an amount claimed to be due under the insurance policy, of argument that Munich has timely raised this argument and (2) the insured requests that the insurer consent to this on appeal. In our analysis of this argument, we begin by exercise of personal jurisdiction. See Elevation Builders, Inc. interpreting the language in these clauses. v. Companion Specialty Ins. Co., No. 15-CV-00490-PAB- KMT, 2015 WL 4159426, at *3 (D. Co. Jul. 8, 2015); Morrow The London Market Insurers' policies have the following Valley Land Co. v. Scottsdale Ins. Co., No. 10-5029, 2010 WL service-of-suit clause: 11509313, at *2–3 (W.D. Ark. May 25, 2010).

On appeal the London Market Insurers assert that the Trustee has not tendered any claims to them or made any demand It is agreed that in the event of for payment on them. The London Market Insurers contend the failure of Underwriters hereon that the trial court record establishes that the Trustee has to pay any amount claimed to be not claimed that any amounts are due under their insurance due hereunder, Underwriters hereon, policies. Century asserts that the Trustee has not sought at the request of the Assured, will payment from Century for any alleged coverage and that the submit to the jurisdiction of any Trustee is not alleging any failure to pay by Century. Munich Court of competent jurisdiction within contends that the Trustee has not alleged the Munich failed to the United States and will comply pay any amount claimed. Significantly, in the trial court these with all requirements necessary to insurers challenged the sufficiency of the Trustee's pleading give such Court jurisdiction and all —whether the Trustee alleged that they had failed to pay matters arising hereunder shall be an amount claimed to be due under the insurance policy. determined in accordance with the law However, none of these insurers submitted evidence showing that the insurer had not failed to pay an amount claimed to be and practice of such Court. 6 due under the insurance policy. Thus, to the extent that one of these insurers asserts in its briefing that it had not failed to

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pay an amount claimed to be due under the insurance policy, the respective insurer to repay, and although the Trustee that is a statement of counsel that is not evidence and that claims that the insurer is obligated to repay Vogt under the is not relevant on the issue of whether the Trustee pleaded respective policy, the insurer has failed to pay what it owes this matter. See Primis Corp. v. Milledge, No. 14-08-00753- in full. Thus, the Trustee has alleged that the SOS Insurers CV, 2010 WL 2103936, at *3, n.2 (Tex. App.—Houston [14th have failed to pay an amount claimed to be due under the Dist.] May 27, 2010, no pet.) (mem. op.). respective insurance policy. See Elevation Builders, Inc., 2015 WL 4159426, at *3; Morrow Valley Land Co., 2010 WL *12 To determine whether the Trustee pleaded that these 11509313, at *2–3. insurers had failed to pay an amount claimed to be due under the insurance policy, we examine the Trustee's live pleading, The Trustee's filing of suit against the SOS Insurers in which the Trustee alleges: constituted an implied request that each of these insurers consent to the trial court's exercise of personal jurisdiction • The Trustee “seeks only nonmonetary relief” in this over the insurer under the respective service-of-suit clause, lawsuit. and none of these clauses requires that the insurer take any further action to make this request. See Morrow Valley Land • The Trustee seeks “declarations making these policies and Co., 2010 WL 11509313, at *2–3. The allegations in the their limits of liability fully available to meet [Vogt's] Trustee's pleading are sufficient to trigger the respective defense and indemnity costs in the Asbestos Suits as service-of-suit clauses, under which the SOS Insurers consent those terms are understood in the insurance business.” to the exercise of personal jurisdiction over the insurer by any • All Insurers are obligated under their respective insurance court of competent jurisdiction in the United States chosen by policies to investigate, defend, reimburse, and indemnify Vogt as to “all matters arising” under the respective policy, Vogt completely against All Asbestos Suits. which includes the Trustee's requests for declaratory relief regarding these insurers and their policies. See Elevation • “The [Insurers], however, have failed or will fail to do Builders, Inc., 2015 WL 4159426, at *3; Morrow Valley Land so [investigate, defend, reimburse, and indemnify Vogt Co., 2010 WL 11509313, at *2–3. completely against All Asbestos Suits] fully in numerous respects....” *13 The London Market Insurers and Century argue that the Trustee did not allege that they failed “to pay any amount • The Trustee seeks a determination of the Insurers' claimed to be due,” because the Trustee seeks only declaratory obligations to defend, reimburse, and indemnify Vogt in relief, not monetary relief. This argument conflates the full against the Asbestos Suits. insured's injury with its relief. The injury that triggers the service-of-suit clause is the insurer's failure to pay an amount Construing the pleading liberally in favor of the plaintiff, as claimed to be due under the respective policy. As relief for we must, the Trustee alleged that (1) the Insurers are obligated that injury, the insured may seek declaratory relief, “whether under their respective insurance policies to reimburse Vogt, or not further relief is or could be claimed.” Tex. Civ. Prac. but they “have failed ... to do so fully”; and (2) the Trustee & Rem. Code Ann. § 37.003(a) (West, Westlaw through seeks a determination of the Insurers' obligations to reimburse 2023 4th C.S.). The service-of-suit clauses simply do not Vogt. 8 See Tex. R. Civ. P. 48 (stating that “[a] party may set require the insured to sue for direct recovery of any unpaid forth two or more statements of a claim ... alternatively ..., amounts claimed to be due. See Strauss v. Admiral Ins. Co., either in one count ... or in separate counts”); Horizon/CMS No. 6:17-CV-480-ORL-31TBS, 2017 WL 2806245, at *1– Healthcare Corp. v. Auld, 34 S.W.3d 887, 897 (Tex. 2000); 2 (M.D. Fla. Jun. 29, 2017) (rejecting insurer's argument Ascentium Captial LLC v. Hi-Tech the School of Cosmetology that similar service-of-suit clause was not triggered because Corp., 558 S.W.3d 824, 829 (Tex. App.—Houston [14th plaintiff sought only declaratory relief that insurer had a duty Dist.] 2018, no pet.). “Reimburse” means to “repay” a to defend and indemnify under the policies). person who has spent or lost money, or to repay a sum that has been spent or lost. See NEW OXFORD AMERICAN The SOS Insurers also argue that the Trustee's pleadings DICTIONARY 1472 (Angus Stevenson & Christine Lindberg are inadequate because they are excess insurers, and the eds., 3d ed. 2010). Therefore, the Trustee alleged that Vogt Trustee did not plead that the limits of the policies underlying has already spent money that the respective policy requires their coverage had been exhausted. But the SOS Insurers

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have overlooked the Trustee's allegation that he “has Century's assertions about the limitations on the Trustee's satisfied ... by operation of law or by virtue of [the Insurers'] authority. Century's argument also conflicts with the language conduct, all terms and conditions of [the Insurers'] insurance of the Plan providing that as of the Plan's effective date “the policies, including ... satisfying all deductibles, self-insured Creditors' Trust and/or the [Trustee for the Creditors' Trust] retentions, and underlying limits of the policies issued by shall be vested and automatically be conferred with, and have [the Insurers] ....” The SOS Insurers have not challenged this all of the power, authority and standing, and shall be the allegation on legal or factual grounds. sole authorized Person with such authority and standing, to take any and all actions that were previously vested in the Century also argues that the Trustee is not “the Insured” under Debtor or the Estate with respect to the Insurance Policies and Century's policy who can invoke the service-of-suit clause shall [ ] automatically be conferred with and have authority in Century's policy. Century asserts that the Trustee only has and standing, and shall be the sole authorized Person with authority over claims against Vogt that were pending when the authority and standing, to take any and all actions that were Plan was confirmed on December 31, 2014. Century asserts previously vested in the Debtor, or the Estate and stand in the in its reply brief that under Texas Rule of Appellate Procedure same position as the Debtor or the estate with respect to any 38.1(g), this court must accept as true the proposition that the claim the Debtor may have to the Insurance Policies.” Trustee has no authority over claims filed after confirmation of Vogt's bankruptcy because Century made this statement *14 The allegations in the Trustee's pleading are sufficient to in its opening brief and the Trustee did not contradict this trigger the respective service-of-suit clauses, under which the statement in his brief. See Tex. R. App. P. 38.1(g). This SOS Insurers consent to the exercise of personal jurisdiction rule provides that the appellant's brief “must state concisely over the insurer by the trial court as to the Trustee's requests and without argument the facts pertinent to the issues or for declaratory relief regarding these insurers and their points presented” and that “[i]n a civil case, the court will policies. See Elevation Builders, Inc., 2015 WL 4159426, at accept as true the facts stated unless another party contradicts *3; Morrow Valley Land Co., 2010 WL 11509313, at *2–3. them.” Id. (emphasis added). In the statement-of-facts section Because the SOS Insurers failed to negate the basis of express of its opening brief Century stated that “[t]he Trustee has consent under the service-of-suit clauses, the trial court did no authority over claims filed after confirmation of Vogt's not err in denying the special appearances of the SOS Insurers. bankruptcy.” But even presuming that the Trustee did not See Ace Ins. Co. v. Zurich American Ins. Co., 59 S.W.3d 424, contradict this statement, under the unambiguous language of 429 (Tex. App.—Houston [1st Dist.] 2001, pet. denied). Rule 38.1(g), this court must accept as true only “facts stated” by the appellant, unless another party contradicts them. See id. The statement on which Century relies is a legal conclusion, D. Did the trial court err in impliedly denying the Non- not a statement of fact; therefore Rule 38.1(g) does not apply. SOS Insurers' special appearances on the ground that See id. the court may exercise personal jurisdiction based on specific jurisdiction? Century contends that the Trustee only has authority over The Trustee asserted specific jurisdiction as a basis for claims against Vogt that were pending when the Plan was the trial court to exercise personal jurisdiction over each confirmed on December 31, 2014, and that the Trustee may of the Insurers. We now address whether the trial court not invoke the service-of-suit clause in Century's policy on erred by impliedly determining that it may exercise personal Vogt's behalf because the Trustee has not identified any jurisdiction over American Home, Oakwood, General Re, and lawsuits against Vogt over which he has authority. The only the Hartford Parties (collectively the “Non-SOS Insurers”) support Century cites for this argument is a statement made based on specific jurisdiction. by one of the attorneys representing Vogt during the 2014 confirmation hearing in the Bankruptcy Case. Century quotes Personal jurisdiction over a nonresident defendant is the attorney's statement to the trial court, “This isn't [a 524(g) constitutional when two conditions are met: (1) the defendant trust]. We're not binding future claimants.” But, arguments of has established minimum contacts with the forum state counsel and bare assertions are not evidence. See Fallon v. and (2) the exercise of personal jurisdiction comports with MD Anderson Physicians Network, 586 S.W.3d 58, 75 (Tex. traditional notions of fair play and substantial justice. See App.—Houston [1st Dist.] 2019, pet. denied); Primis Corp., BMC Software, 83 S.W.3d at 795. For a defendant to have 2010 WL 2103936, at *3, n.2. Thus, no evidence supports sufficient contacts with the forum, it is essential that there be some act by which the defendant “purposefully avails”

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itself of the privilege of conducting activities in the forum Trustee lists various insurance policies allegedly issued by state, thus invoking the benefits and protections of its laws. one of the Insurers and alleges that each of the policies is Michiana Easy Livin' Country, Inc. v. Holten, 168 S.W.3d “responsive to [All Asbestos Suits].” The Trustee contends 777, 784 (Tex. 2005). In analyzing personal jurisdiction, that all Insurers are obligated under their respective insurance only the defendant's purposeful contacts with the forum policies to investigate, defend, reimburse, and indemnify Vogt count; personal jurisdiction over a defendant cannot be based completely against All Asbestos Suits. The Trustee asserts on the unilateral activity of another party. Id. at 785. A that the Insurers have failed to do so fully in numerous defendant should not be subject to a Texas court's exercise respects. The Trustee seeks a determination of the Insurers' of personal jurisdiction based on random, fortuitous, or obligations to defend, reimburse, and indemnify Vogt in full attenuated contacts. Id. For there to be purposeful availment, against All Asbestos Suits. The Trustee claims that he has a defendant must seek some benefit, advantage, or profit by satisfied, will be deemed to have satisfied, or has been or will “availing” itself of the jurisdiction. Id. be relieved from satisfying, all terms and conditions of these policies, including without limitation payment of premiums, Specific jurisdiction exists when the claims in question arise satisfaction or relief from satisfying all deductibles, self- from or relate to the defendant's purposeful contacts with insured retentions, and underlying limits of these policies, and Texas. Am. Type Culture Collection Inc. v. Coleman, 83 that the Trustee is entitled to the full benefit of the insurance. S.W.3d 801, 807 (Tex. 2002). For a nonresident defendant's contacts with Texas to support an exercise of specific The Trustee alleges that Vogt has been and continues to be jurisdiction, there must be a substantial connection between a defendant in multiple asbestos lawsuits filed in Texas, by the defendant's purposeful contacts with Texas and the Texans, alleging injurious exposure to asbestos in Texas. operative facts of the litigation. See Moki Mac River According to the Trustee, a significant portion of Vogt's Expeditions v. Drugg, 221 S.W.3d 569, 585 (Tex. 2007). asbestos liabilities arise in Texas. We first address whether the trial court erred by impliedly denying the Non-SOS Insurers' In examining the connection between a defendant's special appearances on the ground that based on specific purposeful contacts with Texas and the operative facts of the jurisdiction the court may exercise personal jurisdiction over litigation, we review the claims in question and the evidence these insurers regarding the Trustee's declaratory-judgment regarding the jurisdictional facts, but we do not determine the claims as to asbestos lawsuits filed against Vogt in Texas merits of the claims. See TV Azteca, S.A.B. De C.V. v. Ruiz, (collectively “Texas Lawsuits”). 490 S.W.3d 29, 35 n.1 (Tex. 2016); Dresser-Rand Group v. Centauro Capital, S.L.U., 448 S.W.3d 577, 584 (Tex. App. —Houston [14th Dist.] 2014, no pet.). The merits of the a. Minimum Contacts Trustee's claims are not at issue in determining whether the trial court erred in denying the Insurers' special appearances. American Home is a New York corporation with its principal See Dresser-Rand Group, 448 S.W.3d at 584. Thus, though place of business in New York, New York. Central National we describe the substance of the Trustee's claims for the Insurance Company of Omaha was a Nebraska corporation purposes of our personal-jurisdiction analysis, we do not with its principal place of business in Nebraska. In 2014 adjudicate these claims or weigh their merit. See id. at 586, Central National merged into Oakwood, which is a Tennessee n.4. corporation, with its principal place of business in New York. First State is a Connecticut corporation, with its principal

1. Specific Jurisdiction regarding the Trustee's claims place of business in Hartford, Connecticut. 9 General Re against the Non-SOS Insurers as to lawsuits against is a Delaware corporation, with its principal place of Vogt in Texas business in Connecticut. Hartford Casualty is an Indiana *15 The Trustee asserts claims against the Insurers seeking corporation, with its principal place of business in Hartford, only non-monetary, declaratory relief. The Trustee alleges Connecticut. Hartford Fire is a Connecticut corporation, with that Vogt has insurance policies that remain responsive to All its principal place of business in Hartford, Connecticut. Asbestos Suits and that he seeks declarations “making these Twin City is an Indiana corporation, with its principal place policies and their limits of liability fully available to meet of business in Hartford, Connecticut. Vogt is a dissolved Vogt's defense and indemnity costs in [All Asbestos Suits], Kentucky corporation, whose principal place of business was as those terms are understood in the insurance business.” The in Kentucky. The Trustee is a resident of Texas, and the trust

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agreement for the Creditors' Trust contains a choice-of-law The Trustee alleges that the Non-SOS Insurers have failed to provision providing that the agreement be interpreted under comply with their obligations under their respective insurance Texas law. policies to investigate, defend, reimburse, and indemnify Vogt completely against the Texas Lawsuits, and because we do The Trustee has argued that the trial court may exercise not address the merits of the Trustee's claims, we presume personal jurisdiction over each of the Non-SOS Insurers for the purposes of our personal-jurisdiction analysis, that this based on specific jurisdiction because of (1) the scope of risks allegation is true. See TV Azteca, S.A.B. De C.V., 490 S.W.3d insured under the Insurers' policies (including the Insurers' at 35 n.1; Dresser-Rand Group, 448 S.W.3d at 584. defense obligations to Vogt, wherever claims are brought) and (2) the nexus between Texas and the claims against Vogt. The Trustee argues that the following connections of his The Trustee asserts that the insurance policies at issue have claims with Texas support the trial court's exercise of specific a nationwide reach and that each of the Insurers underwrote jurisdiction: (1) the Trustee is a Texas resident who filed this risks in Texas when they issued their policies to Vogt. The suit in Texas to fulfill his duty to marshal the Vogt assets Non-SOS Insurers have not submitted evidence showing that and settle the claims of asbestos claimants and their families; their policies lack a nationwide reach or that Texas is outside and (2) the trust agreement for the Creditors' Trust contains of the coverage area of their policies. a choice-of-law provision providing that the agreement be interpreted under Texas law. But these Texas contacts are The Trustee alleges that Vogt has been and continues to be contacts of parties other than the Insurers rather than the a defendant in the Texas Lawsuits. In his response in the purposeful contacts of one of the Insurers with Texas. See trial court the Trustee cited three Texas cases as examples Michiana Easy Livin' Country, Inc., 168 S.W.3d at 784. of the Texas Lawsuits. The Trustee also referred to the Therefore, we do not consider these contacts in our minimum- Wilkerson lawsuit and the Gillespie lawsuit. The Century contacts analysis. See id. Parties submitted evidence showing that in one lawsuit (the Freed case), Vogt was a defendant but that the claims against Vogt was a Kentucky entity, and none of the Non-SOS Vogt were non-suited less than a month after Vogt was served Insurers are incorporated in Texas or have a principal place with citation. In addition, we accept as true the following facts of business in Texas. We presume that all of the actions of that Oakwood stated in the statement-of-facts section of its Vogt and the Non-SOS Insurers surrounding the negotiation opening brief and that no party contradicted: and formation of the Non-SOS insurance policies occurred outside of Texas. We presume that all the people who *16 • The 2019 amended petition in the Valley case did handle, process, or manage claims for the Non-SOS Insurers not name Vogt as a defendant. are located outside of Texas. Nonetheless, the Non-SOS insurance policies provide coverage for third-party liability • The Nolan lawsuit was filed in August 2018, and five occurring in claims filed in Texas. See Guardian Royal Exch. years later Vogt still had not been served. Assur., Ltd., 815 S.W.2d at 231. • The Wilkerson lawsuit was filed in 2012 and was dismissed on December 7, 2018, because unspecified *17 We accept as true the following facts that Oakwood defendants settled. stated in the statement-of-facts section of its opening brief and that no party contradicted: (1) the insurance policies that • The Gillespie lawsuit was closed in 2004. 10 Oakwood issued to Vogt make no mention of Texas; and (2) Oakwood is not aware of any asbestos suits currently See Tex. R. App. P. 38.1(g). The Trustee was not required to pending against Vogt in Texas. See Tex. R. App. P. 38.1(g). specify all of the Texas Lawsuits in its allegations, and the We accept as true the following fact that General Re stated in Trustee said that the three case it cited were only examples the statement-of-facts section of its opening brief and that no of the Texas Lawsuits. In any event, none of the Insurers party contradicted: The Gen Re excess liability policy does has submitted evidence controverting the Trustee's allegation not mention Texas. See id. that Vogt has been a defendant in asbestos lawsuits filed in Texas or the Trustee's allegation that Vogt continues to be a We conclude that the Guardian Royal precedent from the defendant in asbestos lawsuits filed in Texas. Supreme Court of Texas governs our analysis regarding the Trustee's declaratory-judgment claims against the Non-SOS

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Insurers as to the Texas Lawsuits (collectively the “Texas Claims”). Therefore, we examine this precedent in detail. In Guardian Royal the Supreme Court of Texas relied on Guardian Royal, an English insurer, issued a policy to English opinions from several federal courts of appeals, including China, an English company, providing coverage for English Rossman and Eli Lilly, in which those courts upheld the China and its subsidiaries as to third-party liability occurring assertion of personal jurisdiction over insurance companies anywhere in the world. See Guardian Royal Exch. Assur., Ltd., based primarily upon foreseeability. See id. at 227, 231– 815 S.W.2d at 225. Southern Clay and Gonzales Clay were 32 & n.16 (relying on Rossman and Eli Lilly); Rossman v. each Texas corporations that were subsidiaries of English State Farm Mut. Auto. Ins. Co., 832 F.2d 282, 286–87 (4th China (collectively the “Subsidiaries”). See id. Although Cir. 1987); Eli Lilly & Co. v. Home Ins. Co., 794 F.2d 710, the policy described the Subsidiaries as being located in 720–21 (D.C. Cir. 1986). The Supreme Court concluded that the “U.S.A.”, there was no indication in the policy that when the nonresident defendant is an insurance company, the Subsidiaries were Texas corporations or were located in the minimum-contacts analysis may be based on either “the Texas, and Guardian Royal did not know whether English insurer's awareness that it was responsible to cover losses China or the Subsidiaries did business in Texas or sent arising from a substantial subject of insurance regularly products to Texas. See id. An employee of Southern Clay was present in the forum state” or “the nature of the particular killed in an on-the-job accident, and the deceased's family insurance contract and its coverage.” See id. at 227, 231–32 & filed wrongful death lawsuits in Texas against the Subsidiaries n.16. The Guardian Royal court based its minimum-contacts and other English China entities (the “Defendants”). See id. analysis on “the nature of the particular insurance contract and The Lawsuits were settled, and U.S. Fire, a liability insurer its coverage.” See id. at 231–32 & n.16. of Southern Clay, contributed $600,000 to the settlement. See id. The Defendants asserted that Guardian Royal should *18 The high court noted that when specific jurisdiction reimburse U.S. Fire for its settlement contribution because is asserted, the plaintiff's claim must arise out of or relate Guardian Royal was the primary insurer. See id. Guardian to the nonresident defendant's contacts with the forum Royal disagreed, asserting that its insurance policy provided state in order to satisfy the minimum-contacts requirement. coverage only for liability in excess of the coverage provided See id. at 227. However, the contact must have resulted by U.S. Fire. See id. U.S. Fire, as subrogee of the Defendants, from the nonresident defendant's purposeful conduct and filed suit in Texas against Guardian Royal, asserting coverage not the unilateral activity of the plaintiff or others. See id. under the Guardian Royal policy and seeking reimbursement When specific jurisdiction is asserted, the minimum-contacts for U.S. Fire's settlement contribution. See id. at 225–26, analysis focuses on the relationship among the defendant, the 233. Guardian Royal filed a special appearance challenging forum, and the litigation. See id. at 228. The Guardian Royal the trial court's ability to exercise personal jurisdiction. See court stated that for Guardian Royal to have purposefully id. at 226. The trial court granted Guardian Royal's special established “minimum contacts” with Texas there must be appearance, and the court of appeals reversed and remanded. a “substantial connection” between Guardian Royal and See id. Texas arising from action or conduct of Guardian Royal purposefully directed toward Texas. See id. at 230. The Supreme Court of Texas granted review and applied a specialized minimum-contacts analysis that emphasized The high court noted that the Guardian Royal policy provided foreseeability. See id. at 227–28, 231–32. The Guardian coverage for third-party liability occurring anywhere in the Royal court stated that, although not determinative, world and that the endorsements to the policy (1) extended foreseeability is also an important consideration in deciding coverage to the Subsidiaries, (2) extended the definition whether a nonresident defendant has purposely established of “Insured” to include any associated and subsidiary “minimum contacts” with the forum state. See id. at 227. The company of English China anywhere in the world, and (3) concept of foreseeability is implicit in the requirement that deleted the policy's geographical limits. See id. at 231– there be a “substantial connection” between the nonresident 32. The Guardian Royal court concluded that under these defendant and Texas arising from action or conduct of the facts and circumstances the nature of the Guardian Royal nonresident defendant purposefully directed toward Texas. insurance policy and its coverage were sufficient to establish See id. The high court stated that foreseeability is especially that Guardian Royal purposefully established “minimum pertinent when the nonresident defendant is an insurance contacts” with Texas, which according to the Guardian company. Id. Royal opinion means that: (1) the plaintiffs' claims against

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Guardian Royal arose out of or related to Guardian Royal's Texas Claims are based on the alleged failure of the Non-SOS contacts with Texas; and (2) a “substantial connection” Insurers to defend Vogt in the Texas Lawsuits, to indemnify existed between Guardian Royal and Texas arising from the Vogt as to the Texas Lawsuits, and to reimburse Vogt for action or conduct of Guardian Royal purposefully directed amounts paid in respect of the Texas Lawsuits. Under these toward Texas. See id. at 227, 230, 232. facts and circumstances and under the binding precedent of Guardian Royal, we conclude that as to the Texas Claims, The Supreme Court concluded that as the insurer of English the nature of the insurance policies between Vogt and the China and its subsidiaries located in many countries in Non-SOS Insurers and the coverages thereunder are sufficient the world including the United States, and as the issuer to establish that the Non-SOS Insurers' purposeful contacts of an insurance policy providing coverage for third-party with Texas satisfy the minimum-contacts test as it applies to liability occurring anywhere in the world, Guardian Royal nonresident insurance companies like the Non-SOS Insurers. could reasonably anticipate the significant risk (if not the See id. at 227, 230, 232; Rossman, 832 F.2d at 286–87; Eli probability) that a subsidiary would become involved in Lilly & Co., 794 F.2d at 720–21. According to the Guardian disputes and litigation in many countries in the world, as Royal court this conclusion means that: (1) the Texas Claims well as in any state in the United States. See id. at 232. The arise out of or relate to the Non-SOS Insurers' contacts Guardian Royal court stated that Guardian Royal also could with Texas; and (2) as to the Texas Claims, a “substantial reasonably anticipate the significant risk that an insurance connection” exists between the Non-SOS Insurers and Texas coverage dispute or question with a subsidiary would arise arising from the action or conduct of the Non-SOS Insurers concerning the litigation. See id. The parties have not cited purposefully directed toward Texas. See Guardian Royal and research has not revealed a case in which the court Exch. Assur., Ltd., 815 S.W.2d at 227, 230, 232. Moreover, as abrogates or overrules the Supreme Court of Texas's opinion to the Texas Claims, the Trustee seeks declarations regarding in Guardian Royal, and we are bound to apply this precedent the Non-SOS Insurers' obligations under the same insurance in today's case. policies that fulfill the minimum-contacts test; thus, there is a substantial connection between the Non-SOS Insurers' Though Vogt was a Kentucky corporation with its principal contacts with Texas and the operative facts of the Texas place of business in Kentucky, rather than a Texas Claims. See Guardian Royal Exch. Assur., Ltd., 815 S.W.2d corporation, the Supreme Court said there was no indication at 227, 230–32. Therefore, the trial court did not err in in the Guardian Royal policy that the Subsidiaries were impliedly determining that the Non-SOS Insurers have the located in Texas and that Guardian Royal did not know minimum contacts necessary for the trial court to exercise whether the Subsidiaries did business in Texas or sent personal jurisdiction over the Texas Claims based on specific products to Texas. See id. at 225. Therefore, we conclude that jurisdiction. See id. at 227, 231–32; Rossman, 832 F.2d at the fact that the Subsidiaries were Texas corporations located 286–87; Eli Lilly & Co., 794 F.2d at 720–21. in Texas is not a material distinction. See id. *19 One or more of the Non-SOS Insurers have cited and Under Guardian Royal, we consider the nature of the Non- relied on opinions from either the United States Court of SOS Insurers' insurance policies and the coverage under these Appeals for the Fifth Circuit or a United States District Court policies. See id. at 227, 231–32. The insurance policies of within the geographical jurisdiction of that appellate court. the Non-SOS Insurers allegedly provide coverage for third- See Shambaugh & Son, L.P. v. Steadfast Ins. Co., 91 F.4th party liability occurring anywhere in the United States. As an 364, 374 (5th Cir. 2024); Perez v. Pan Am. Life Ins. Co., insurer of Vogt and the issuer of an insurance policy providing No. 96-20241, 1996 WL 511748, at *2 (5th Cir. Aug. 20, coverage for third-party liability occurring in Texas, each 1996) (not designated for publication); Etienne v. Wartsila of the Non-SOS Insurers could reasonably anticipate the N. Am., Inc., 667 F.Supp.3d 235, 249–51 (S.D. Miss 2023); significant risk that Vogt would become involved in disputes Baird v. Shagdarsuren, 426 F. Supp. 3d 284, 287–91 (N.D. and litigation in Texas. See id. at 232. In addition each of the Tex. 2019); Lillie v. Stanford Trust Co., No. 3:13-cv-3127, Non-SOS Insurers could reasonably anticipate the significant 2015 WL 13741930, at *3–4 (N.D. Tex. Apr. 7, 2015). We are risk that an insurance coverage dispute or question with Vogt not bound to follow precedent from the courts that authored would arise in Texas concerning litigation in Texas. See id. these opinions. See Penrod Drilling Corp. v. Williams, 868 Foreseeability is especially pertinent when the nonresident S.W.2d 294, 296 (Tex. 1993). These opinions conflict with defendant is an insurance company. Id. at 227. In addition the the Guardian Royal precedent, which does bind this court.

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See id. In addition, these cases conflict with the opinions of a majority of the United States Courts of Appeals that b. Traditional Notions of Fair Play and Substantial Justice have addressed this issue. Compare Shambaugh & Son, L.P., 91 F.4th at 374 with Rossman, 832 F.2d at 286; Payne v. After a court finds the minimum contacts necessary to Motorists' Mut. Ins. Companies, 4 F.3d 452, 455 (6th Cir. exercise personal jurisdiction over a nonresident defendant, 1993); Ferrell v. W. Bend Mut. Ins. Co., 393 F.3d 786, 791 (8th federal due process requires the court to determine whether Cir. 2005); Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. the exercise of that jurisdiction comports with traditional Co., 907 F.2d 911, 914 (9th Cir. 1990); TH Agric. & Nutrition, notions of fair play and substantial justice. See Guardian LLC v. Ace European Grp. Ltd., 488 F.3d 1282, 1288–91 (10th Royal Exch. Assur., Ltd., 815 S.W.2d at 228. In deciding this Cir. 2007); McGow v. McCurry, 412 F.3d 1207, 1215 (11th issue, we consider the following factors: (1) the burden on the Cir. 2005), abrogated on other grounds, Diamond Crystal defendant, (2) the interests of the forum state in adjudicating Brands, Inc. v. Food Movers Int'l, Inc., 593 F.3d 1249 (11th the dispute, (3) the plaintiff's interest in obtaining convenient Cir. 2010); Eli Lilly & Co., 794 F.2d at 720–21. and effective relief, (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies, American Home and General Re also cite an opinion from and (5) the shared interest of the several states in furthering the United States Court of Appeals for the Seventh Circuit. fundamental substantive social policies. 11 Id. Only in rare See Lexington Ins. Co. v. Hotai Ins. Co., 938 F.3d 874, 878– cases will the exercise of personal jurisdiction not comport 84 (7th Cir. 2019). As with the Fifth Circuit cases, we are with fair play and substantial justice when the nonresident not bound to follow precedent from the Seventh Circuit, and defendant purposefully has established minimum contacts we are bound to follow the Guardian Royal precedent. See with the forum state. Id. at 231. Such rare cases generally Penrod Drilling Corp., 868 S.W.2d at 296. In addition, the have involved defendants who are residents of another nation, Lexington court distinguished the Rossman line of cases on and none of the Non-SOS Insurers is a resident of another the ground that this line of cases, except for TH Agric. & nation. See Asahi Metal Indus. Co. v. Superior Court, 480 U.S. Nutrition, LLC, involved insurers who allegedly had a duty to 102, 113–15, 107 S.Ct. 1026, 1033–34, 94 L.Ed.2d 92 (1987); defend, but the insurers in Lexington had the right, but not the Guardian Royal, 815 S.W.2d at 232–33; Lensing v. Card, 417 duty, to defend the insured. See Lexington Ins. Co., 938 F.3d S.W.3d 152, 161 (Tex. App.—Dallas 2013, no pet.); Juarez at 882–83; TH Agric. & Nutrition, LLC, 488 F.3d at 1288– v. UPS de Mexico S.A. de C.V., 933 S.W.2d 281, 286 (Tex. 91. The Lexington court stated that “[t]he absence of a duty- App.—Corpus Christi 1996, no writ). The Non-SOS Insurers to-defend clause is decisive” and indicated that the result in must present a compelling case that the presence of some Lexington might have been different if the insurers had owed other considerations would render the exercise of personal a duty to defend. See id. at 882. jurisdiction unreasonable. See Guardian Royal Exch. Assur., Ltd., 815 S.W.2d at 231. The Non-SOS Insurers also rely on an opinion from the United States District Court of New Jersey for the proposition *20 Burden on the Defendant. As to the burden of litigating that the relevant contacts for purposes of determining this case in Harris County, Texas, none of the Non-SOS whether personal jurisdiction exists are those “aris[ing] from Insurers argue on appeal that this burden is unreasonable, the contacts relevant to the formation of the insurance nor do any of them cite any evidence in the record as to the agreement.” Ohio Sec. Ins. Co. v. Premium Food Grp., Inc., magnitude of this burden. No. 21-15690 (FLW), 2022 WL 2358425, at *5 (D.N.J. June 30, 2022). We are not bound by this precedent, and it conflicts Interests of the Forum State. As to Texas's interests in with cases cited by one or more of the Non-SOS Insurers, adjudicating the dispute, Texas's regulatory interests are an in which courts stated that forum contacts relating to the important consideration in deciding whether the exercise of procurement and enforcement of the insurance policy should personal jurisdiction is reasonable. See id. at 229. States have be considered in the minimum-contacts analysis. See, e.g., E. a legitimate concern in areas in which the state possesses Concrete Materials, Inc. v. ACE Am. Ins. Co., 948 F.3d 289, a manifest regulatory interest such as insurance. See id. 298 (5th Cir. 2020). Traditionally, the regulation of the “business of insurance” has been delegated to the states by the federal government. See id. Texas has a special interest in regulating insurance, and Texas courts have implicitly recognized the role of that

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interest for the purposes of determining whether a Texas court conveniens argument rather than a due-process argument. may exercise personal jurisdiction. See id. A state's regulatory According to these Non-SOS Insurers, unlike any Texas court, interest in a certain area or activity such as insurance is an the Kentucky court has personal jurisdiction over all parties important consideration in deciding whether the exercise of named there because all of the insurers issued policies to a personal jurisdiction is reasonable, and a state's regulatory Kentucky-based policyholder and any dispute the Kentucky- interest may establish the reasonableness of jurisdiction upon based policyholder has arises out of its Kentucky insurance a lesser showing of minimum contacts than would otherwise contracts. The Kentucky trial court has not yet determined be required. See id. The Trustee alleges that Vogt has been whether it has subject-matter jurisdiction over the claims in and continues to be a defendant in multiple asbestos lawsuits the amended complaint or whether it may exercise personal filed in Texas, by Texans, alleging injurious exposure to jurisdiction over these claims, and we have concluded that asbestos in Texas, and none of the Non-SOS Insurers have the Trustee's claims against the SOS Insurers should be submitted evidence showing that this allegation is incorrect. litigated in Texas based on service-of-suit clauses in the Based on this allegation the Texas Claims include Texas respective insurance policies. The argument that Texas courts residents who have tort claims currently pending in Texas may not exercise personal jurisdiction is not helpful because against Vogt, and whose effort to obtain compensation for it presumes the answer to the issue in controversy. The fourth their alleged personal-injury damages might be aided by and fifth factors weigh in favor of the reasonableness of Texas the declaratory relief sought by the Trustee in the Texas courts exercising personal jurisdiction over the Texas Claims. Claims. Due to its interest in regulating insurance, Texas holds a significant interest in adjudicating the Texas Claims. *21 The Guardian Royal court decided that the exercise of See id. American Home and General Re assert that Texas personal jurisdiction over the claims in that case would not has little interest—and Kentucky has a strong interest— comport with traditional notions of fair play and substantial in having its courts exercise personal jurisdiction over this justice. See id. at 232–33. The high court based its conclusion coverage dispute. For the reasons stated above, we conclude on how burdensome it would be for Guardian Royal, an that Texas has a significant interest. Though Kentucky has English insurer, to submit its dispute to a foreign nation's an interest in exercising personal jurisdiction over coverage judicial system. The issue in today's case does not involve issues regarding the Texas Lawsuits and involving insurance an international insurer or a foreign nation's judicial system, policies issued to a Kentucky insured, that insured is dissolved and the Non-SOS Insurers have not shown that it would and no longer has any operations in Kentucky, and all of the be burdensome to litigate the Texas Claims in Texas. Even insured's rights to the insurance have been transferred to a though U.S. Fire as subrogee brought the claims in Texas in Texas trust. the name of the Defendants, including the Subsidiaries, the Guardian Royal court characterized the case as “a dispute The Plaintiffs' Interest in Obtaining Convenient and Effective between two insurers—Guardian Royal and U.S. Fire as Relief. The Trustee has filed the Texas Claims in Texas and subrogee to the rights of the [Defendants].” Id. at 233. therefore believes that it is in its interest to be here. We see Significantly, even though the high court did not rely on the no reason to disagree. The trial court's exercise of personal subrogee status in its minimum-contacts analysis, it did so jurisdiction over the Texas Claims would further the plaintiff's in analyzing fair play and substantial justice. See id. This interest in obtaining convenient and effective relief. indicates that we may consider the Trustee's status as assignee of the Policies and the associated interests therein, in which The Interstate Judicial System's Interest and the Shared case we may consider the fact that the Trustee is a resident of Interest of the Several States. As to the interstate judicial Texas and the Trust is a Texas trust, which weighs in favor system's interest in obtaining the most efficient resolution of of a conclusion that the exercise of personal jurisdiction is controversies and the shared interest of the several states in reasonable and does not violate traditional notions of fair play furthering fundamental substantive social policies, American and substantial justice. See id. The Guardian Royal court also Home, General Re, and Oakwood contend that the “most noted that U.S. Fire, the real party in interest, was seeking logical forum” for this litigation is in a Kentucky state reimbursement for funds contributed toward settlement and court, where a competing action already is on file. 12 The that the personal-injury plaintiffs had been compensated and exercise of personal jurisdiction by courts in one forum is the insureds had been defended and indemnified by U.S. not constitutionally infirm just because a more “logical” Fire. See id. Under the Trustee's uncontroverted pleadings, forum is available. Thus, this seems to be a forum non

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personal-injury claims remain pending in Texas, so not all 585. Therefore, we conclude that the trial court erred to personal-injury plaintiffs have been compensated. the extent the court impliedly denied the Non-SOS Insurers' special appearances on the ground that the court may exercise After carefully considering the record and all of the factors personal jurisdiction as to the Non-Texas Claims based on in the legal standard, we conclude that none of the Non- specific jurisdiction. See id. SOS Insurers have made a compelling case that the exercise of personal jurisdiction over the Texas Claims would be unreasonable or would violate traditional notions of fair play E. Did the trial court err in impliedly denying the and substantial justice. See Amec Foster Wheeler, PLC v. special appearances of four of the Insurers on the Enterprise Prods. Operating, LLC, 631 S.W.3d 147, 161– basis of general jurisdiction? 63 (Tex. App.—Houston [14th Dist.] 2020, pet. denied). In the trial court, the Trustee asserted general jurisdiction as a Therefore, we conclude that the trial court did not err to basis for the trial court to exercise personal jurisdiction over the extent the court impliedly denied the Non-SOS Insurers' Hartford Casualty, Hartford Fire, Twin City, and American special appearances on the ground that the court may exercise Home (collectively the “Four Insurers”). A court may personal jurisdiction as to the Texas Claims based on specific exercise general jurisdiction over a nonresident corporation jurisdiction. whose contacts with the forum state are so continuous and systematic as to render the corporation “essentially at home” in the forum state. See Daimler AG v. Bauman, 571 U.S. 2. Specific Jurisdiction regarding the Trustee's claims 117, 127, 139 (2014); Old Republic Nat'l Title Ins. Co. v. against the Non-SOS Insurers as to lawsuits against Bell, 549 S.W.3d 550, 565 (Tex. 2018). For a defendant Vogt other than the Texas Lawsuits corporation, the paradigm forum for the exercise of general We next consider whether the trial court erred to the extent jurisdiction is the place of incorporation and the principal the court concluded based on specific jurisdiction that it place of business. Bauman, 571 U.S. at 137. In an exceptional may exercise personal jurisdiction over the Trustee's claims case, a corporation's operations in a forum other than its against the Non-SOS Insurers as to asbestos lawsuits filed place of incorporation or principal place of business may against Vogt other than the Texas Lawsuits (collectively the be so substantial and of such a nature as to render the “Non-Texas Lawsuits”). In Guardian Royal the Supreme corporation at home in that State. See Bauman, 571 U.S. at Court concluded that the nature of the Guardian Royal 139 n. 19. General jurisdiction may be established whether or insurance policy and its coverage were sufficient to establish not the nonresident defendant's alleged liability arises from that Guardian Royal purposefully established “minimum those contacts. See Old Republic Nat'l Title Ins. Co., 549 contacts” with Texas in a case in which the Guardian Royal S.W.3d at 565. A general-jurisdiction inquiry is very different allegedly breached its obligations under the policy by failing from a specific-jurisdiction inquiry and involves a more to indemnify the Defendants against liability for tort claims demanding minimum-contacts analysis, with a substantially filed in Texas and by failing to reimburse U.S. Fire for higher threshold. Id. Even if the contacts of one of the Four its contribution to the settlement of the Texas lawsuits. See Insurers with Texas were continuous and systematic, they Guardian Royal Exch. Assur., Ltd., 815 S.W.2d at 225– still would be insufficient to confer general jurisdiction if 26, 231–32. In Guardian Royal, both the underlying tort the contacts fail to rise to the level of making the insurer claims and the reimbursement claims based on coverage “essentially at home” in Texas. See id. under Guardian Royal's policy were filed in Texas. See id. at 225–26. We conclude that asbestos claims filed against Vogt *22 None of the Four Insurers has a place of incorporation outside the state of Texas do not fall within the scope of the or principal place of business in Texas. Thus, the only way Guardian Royal precedent. See id. at 225–26, 231–32. for the trial court to exercise personal jurisdiction over one of the Four Insurers would be for the “exceptional case” Under the applicable standard of review, we conclude that to apply. See Bauman, 571 U.S. at 139 n. 19. In the trial the Non-SOS Insurers negated the existence of a substantial court the Trustee contended that general jurisdiction applies connection between the purposeful contacts of the Non-SOS to the Four Insurers because they regularly defend lawsuits Insurers with Texas and the operative facts of the Trustee's in Texas, and they are currently prosecuting civil cases declaratory-judgment claims against the Non-SOS Insurers in Texas. The Trustee submitted evidence showing that in as to the Non-Texas Lawsuits (collectively the “Non-Texas 2022: (1) American Home earned more than $39 million in Claims”). See Moki Mac River Expeditions, 221 S.W.3d at Texas premiums; (2) Hartford Casualty earned more than

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$60 million in Texas premiums; (3) Hartford Fire earned of the Four Insurers based on general jurisdiction, the trial more than $154 million in Texas premiums; and (4) Twin court erred. City earned more than $236 million in Texas premiums. The Trustee also submitted evidence of similar premium We overrule the London Market Insurers' two appellate amounts in the previous four years. But the Trustee did not put issues, overrule Century's three issues, overrule Munich's these premium amounts in the context of the total premiums appellate issue, and affirm the trial court's order to the extent earned in that year. The Hartford Parties submitted evidence that the trial court denied the special appearances of each of that the 2022 Texas premiums were 5.6% of the total 2022 the London Market Insurers, Century, and Munich. As to the premiums earned for Hartford Casualty, 10.1% of the total first issue of American Home and General Re we overrule for Hartford Fire, and 8.5% of the total for Twin City. Even the issue to the extent these parties challenge the trial court's taking the Trustee's allegations regarding general jurisdiction denial of their special appearances as to the Texas Claims, over the Four Insurers as true, we conclude that the Four and we sustain the issue to the extent they challenge the trial Insurers negated the existence of an “exceptional case” for court's denial of their special appearances as to the Non-Texas the application of general jurisdiction and as a matter of law Claims. 13 We affirm the trial court's order to the extent the the trial court may not exercise personal jurisdiction over any trial court denied the special appearances of American Home of the Four Insurers based on general jurisdiction. See Klein and General Re as to the Texas Claims. We reverse the trial v. Novotny, C.A. No. 3:15-CV-2885-K, 2017 WL 4083559, court's order to the extent the trial court denied the special *3–4 (N.D. Tex. Aug. 22, 2017); Old Republic Nat'l Title Ins. appearances of American Home and General Re as to the Co., 549 S.W.3d at 565. To the extent the trial court concluded Non-Texas Claims, and we remand to the trial court with it may exercise personal jurisdiction over any of the Four instructions to issue an order dismissing these claims for lack Insurers based on general jurisdiction, the trial court erred. of personal jurisdiction. See Klein, 2017 WL 4083559, *3–4; Old Republic Nat'l Title Ins. Co., 549 S.W.3d at 565. As to the Oakwood's second issue, we overrule the issue to the extent Oakwood challenges the trial court's denial of its special appearance as to the Texas Claims, and we sustain the III. CONCLUSION issue to the extent Oakwood challenges the trial court's denial of its special appearance as to the Non-Texas Claims. 14 We As a matter of law and under the unambiguous language of affirm the trial court's order to the extent the trial court denied Section 9.202 and chapter 9 of the Code, by registering to do Oakwood's special appearance as to the Texas Claims. We business in Texas the Registered Insurers did not impliedly reverse the trial court's order to the extent the trial court denied consent to the exercise of personal jurisdiction over them Oakwood's special appearance as to the Non-Texas Claims, by Texas courts in all cases filed in Texas. The Trustee and we remand to the trial court with instructions to issue an satisfied any burden he had to plead sufficient allegations to order dismissing these claims for lack of personal jurisdiction. bring the Insurers within the Texas long-arm statute, and the burden shifted to each of the Insurers to negate all bases of *23 As to the Hartford Parties' sole issue, we overrule personal jurisdiction that the Trustee alleged against the party the issue to the extent the Hartford Parties challenge the in question. Because the SOS Insurers failed to negate the trial court's denial of their special appearances as to the basis of express consent under the service-of-suit clauses, the Texas Claims, and we sustain the issue to the extent the trial court did not err in denying the special appearances of the Hartford Parties challenge the trial court's denial of their SOS Insurers. The trial court did not err to the extent the court special appearances as to the Non-Texas Claims. We affirm impliedly denied the Non-SOS Insurers' special appearances the trial court's order to the extent the trial court denied the on the ground that the court may exercise personal jurisdiction Hartford Parties' special appearances as to the Texas Claims. as to the Texas Claims based on specific jurisdiction. The We reverse the trial court's order to the extent the trial court trial court erred to the extent the court impliedly denied the denied the Hartford Parties' special appearances as to the Non-SOS Insurers' special appearances on the ground that the Non-Texas Claims, and we remand to the trial court with court may exercise personal jurisdiction as to the Non-Texas instructions to issue an order dismissing these claims for lack Claims based on specific jurisdiction. To the extent the trial of personal jurisdiction. court concluded it may exercise personal jurisdiction over any

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All Citations

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Footnotes

1 The total number of plaintiffs declined between 2004 and 2012 due largely to the dismissal or withdrawal of large groups of plaintiffs in a few states.

2 The Republic of Maldives is a country consisting of various islands in the Indian Ocean and located more than 10,000 miles away from Houston, Texas.

3 The Trustee does not assert that First State or the London Market Insurers consented to personal jurisdiction under Section 9.202. Nonetheless, in a footnote in his appellate brief, the Trustee asserts that although First State and the London Market Insurers have not registered to do business in Texas under chapter 9, they are still covered by Section 9.202 as “foreign nonfiling entities” because they are not required to, and have not, registered to do business in Texas under chapter 9. This argument proves too much. Though this status would make these entities “foreign nonfiling entities” subject to Section 9.202, this point shows that the Trustee's interpretation of Section 9.202 is unreasonable.

4 Because we reject the Trustee's interpretation of chapter 9 of the Code, we do not address the Century Parties' argument that if we were to agree with the Trustee's statutory interpretation then chapter 9 would violate the dormant Commerce Clause of the United States Constitution.

5 On appeal the Trustee asserts that the London Market Insurers, Century, Oakwood, and Munich have service- of-suit clauses in their insurance policies. The inclusion of Oakwood in this group on appeal may have been inadvertent because it results from the Trustee's definition of “Century” in his appellate brief to include both Century and Oakwood. In any event the Trustee did not assert a service-of-suit clause as a basis for personal jurisdiction against Oakwood in the trial court. Therefore, we may not use any service-of-suit clause as a basis for affirming the trial court's order denying Oakwood's special appearance. See Old Republic Nat'l Title Ins. Co., 549 S.W.3d at 559.

6 Emphasis added. The London Market Insurers' policies do not contain any arbitration provision.

7 The Century policy has the following service-of-suit clause:

“It is agreed that in the event of the failure of the Company hereon to pay any amount claimed to be due hereunder, the Company hereon, at the request of the Insured, will submit to the jurisdiction of any court of competent jurisdiction within the United States of America and will comply with all requirements necessary to give such Court jurisdiction and all matters arising hereunder shall be determined in accordance with the law and practice of such Court.” (emphasis added).

The Munich policies have the following service-of-suit clause:

“It is agreed that in the event of the failure of the Company to pay any amount claimed to be due hereunder, the Company, at the request of the Insured, will submit to the jurisdiction of any Court of Competent Jurisdiction within the United States and will comply with all the requirements necessary to give

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such Court jurisdiction and all matters arising hereunder shall be determined in accordance with the law and practice of such court.” (emphasis added).

None of these policies contains an arbitration provision.

8 The London Market Insurers and Century assert that an insurer's denial that it has an obligation to indemnify an insured is not a failure to pay an amount claimed to be due. We do not rely on the denial by that SOS Insurers that they have an obligation to indemnify Vogt.

9 In the Petition the Trustee alleges that First State issued a single policy to Vogt in 1977, but First State and the Trustee have been unable to locate a copy of the alleged policy.

10 In its reply brief Oakwood asserts that this court must accept as true the following facts under Texas Rule of Appellate Procedure 38.1(g): “There are no currently pending claims against [Vogt] in Texas, and there were none as of the date of [the Trustee's] Petition.” See Tex. R. App. P. 38.1(g). Under this rule we will accept as true the facts stated in the statement-of-facts section of an appellant's opening brief unless another party contradicts them. See id. (stating that “[i]n a civil case, the court will accept as true the facts stated unless another party contradicts them”). In the statement-of-facts section of Oakwood's opening brief Oakwood does not state that there are no currently pending claims against Vogt in Texas, nor does Oakwood state that there were no such claims as of the date of the Trustee's Petition. Therefore, we will not accept either of these statements as true under Rule 38.1(g).

11 When the defendant is a resident of another nation, we also consider (a) the unique burdens placed on the defendant who must defend itself in a foreign legal system, (b) the procedural and substantive policies of other nations whose interests are affected by the assertion of jurisdiction by a state court, and (c) the federal government's interest in its foreign-relations policies. See Guardian Royal Exch. Assur., Ltd., 815 S.W.2d at 229. Because none of the Non-SOS Insurers is a resident of another nation, we do not consider these factors.

12 In April 2023, several of the defendants in this case filed suit in Kentucky state court naming Vogt by and through the Trustee as the defendant and the other defendants in this case as nominal defendants (“Kentucky Case”). The plaintiffs in the Kentucky Case sought declaratory relief as to whether certain insurance policies apply to asbestos claims against Vogt. In January 2024 the trial court in the Kentucky Case granted Vogt's motion to dismiss for lack of subject matter jurisdiction. In August 2024 the trial court in the Kentucky Case granted the plaintiffs' motion for leave to amend their complaint to cure the deficiencies that lead the trial court to dismiss the plaintiffs' claims for lack of subject-matter jurisdiction. The Trustee then filed a motion to dismiss the amended complaint for lack of subject-matter jurisdiction and for lack of personal jurisdiction.

13 We need not and do not address their second issue.

14 We need not and do not address Oakwood's first issue.

End of Document © 2025 Thomson Reuters. No claim to original U.S. Government Works.

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