KF Franchising, Ltd. v. TASONE inc et al, No. 4:2017cv03849 - Document 22 (S.D. Tex. 2018)
Court Description: MEMORANDUM OPINION AND ORDER granting 8 MOTION to Dismiss 1 Complaint for Lack of Personal Jurisdiction (Signed by Judge Sim Lake) Parties notified. (aboyd, 4)
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KF Franchising, Ltd. v. TASONE inc et al Doc. 22 United States District Court Southern District of Texas ENTERED IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION KF FRANCHISING, LTD., § § § § § § § § § § Plaintiff, v. TASONE INC., STEVE BOLES, and RAZIJE ELEZ, Defendants. April 18, 2018 David J. Bradley, Clerk CIVIL ACTION NO. H-17-3849 MEMORANDUM OPINION AND ORDER Plaintiff, KF Franchising, action against defendants, Elez (collectively, Defendants' Ltd. ("Plaintiff"), Tasone Inc., "Defendants"). brought this Steve Boles, and Razije Pending before the court are Motion to Dismiss for Lack of Personal Jurisdiction ("Motion to Dismiss") (Docket Entry No. 8), Plaintiff's Response to Defendants' Motion to Dismiss for Lack of Personal Jurisdiction and Brief in Support ("Plaintiff's Response") (Docket Entry No. 14), and Defendants' Reply to Plaintiff's Response to Defendants' Motion to Dismiss for Lack of Personal Jurisdiction ("Defendants' Reply") (Docket Entry No. 17). For the reasons stated below, Defendants' Motion to Dismiss will be granted. "A court sitting in jurisdiction only to the applicable state law. '" F. App'x 338, Peterson, 342 'may extent permitted a Dontos v. (5th Cir. 117 F.3d 278, diversity 281 2014) exercise personal state court under Vendomation NZ Limited, (quoting Allred v. (5th Cir. 1997), cert. 582 Moore denied, & 118 Dockets.Justia.com S. Ct. 691 (1998)). "In Texas, collateral estoppel precludes the relitigation of any ultimate issue actually litigated and essential to the judgment in the prior suit." Deckert v. Wachovia Student Financial Services, Inc., 963 F.2d 816, 819 (5th Cir. 1992) Suber v. Ohio Medical Products, 811 S.W.2d 646, 652 (citing (Tex. App.-- Houston [14th Dist.] 1991, writ requested)). Plaintiff sued Defendants in a Texas state court for breach of a franchise agreement, breach of a guaranty, violation of the Texas Uniform Trade Secrets Act, and unfair competition. 1 Defendants filed a Verified Special Appearance seeking to dismiss the case for lack of personal jurisdiction and a Motions to Dismiss for Lack of Personal Jurisdiction. 2 Plaintiff filed a response to Defendants' Motion to Dismiss for Lack of Personal Jurisdiction. 3 2017, On March 31, the Texas court granted Defendants' Motions to Dismiss for Lack of Personal Jurisdiction. 4 The Texas court ordered that 1 See Plaintiff's Verified Original Petition and Application for Permanent Injunction ("Original Petition"), Exhibit 1 to Motion to Dismiss, Docket Entry No. 8-1, pp. 11-15. 2 See Defendants' Verified Special Appearances & Original Answers, Exhibit 3 to Defendants' Reply, Docket Entry No. 17-1; Defendants' Motions to Dismiss for Lack of Personal Jurisdiction & First Supplemental Special Appearances, Exhibit 4 to Defendants' Reply, Docket Entry No. 17-2. 3 See Plaintiff's Response to Defendants' Motions to Dismiss for Lack of Personal Jurisdiction and First Supplemental Special Appearances, Exhibit 5 to Defendants' Reply, Docket Entry No. 17-3. 4 0rder Granting Motions to Dismiss for Lack of Personal Jurisdiction (Special Appearances) in the 215th Judicial District Court of Harris County, Texas ("Texas Order"), Cause No. 2016-65698, Exhibit 2 to Motion to Dismiss, Docket Entry No. 8-2, pp. 2-3. -2- with the sole exception of plaintiff's breach of contract claims . . all of plaintiff's claims, including KFF's claims involving intellectual property, misappropriation, trade secrets, infringement of trade marks or copyrights, violations of the Texas Uniform Trade Secrets Act, unfair competition, competition, breach of non-compete agreements, holding over and continuing to operate, and the breach of contract claims based upon these allegations, are dismissed for want of 5 jurisdiction." Instead of appealing the state court dismissal Plaintiff filed the pending action in this court for (1) Agreement-Covenant Against alleging that Defendants "owning, operating, "Breach of the Franchise Competition" breached accepting the against all Franchise employment by Agreement and/or interest in a bakery" and by violating the covenant; of the Lanham Act for copyright infringement; of trade secrets; defendant Tasone; and Elez; (7) ( 5) ( 4) is holding by an (2) violations misappropriation breach of the franchise agreement against breach of guaranty against defendants Boles (5) violation of the Texas Uniform Trade Secrets Act; unfair competition; Complaint (3) Defendants based on and the (8) same attorneys' facts alleged 6 Plaintiff's in fees. Plaintiff's Verified Original Petition in state court. Plaintiff argues that the state court dismissed Plaintiff's claims for lack jurisdiction, of subject because the matter Texas jurisdiction, court held not that it personal lacked jurisdiction over Plaintiff's "claims" but "contained no rulings as 5 Id. 6 Plaintiff' s Verified Complaint No. 1, pp. 11-28. -3- ("Complaint") , Docket Entry to jurisdiction over the Defendants' person or property." 7 Plaintiff therefore argues that collateral estoppel does not bar this action for lack of personal jurisdiction. 8 The court is not persuaded by Plaintiff's arguments. clear from the state court record that the parties litigated the question of personal jurisdiction. Texas "personal" court did not use the word or It is actually Although the "in personam" jurisdiction, the court granted "defendants' Motions to Dismiss for Lack of Personal Jurisdiction (Special Appearances)" and concluded that "defendants' motions are meritorious." 3 Because the Texas court it jurisdiction held Defendants, that did not have personal over Plaintiff "cannot now seek to relitigate in federal court the personal jurisdiction issue which was the basis of the state court's order of dismissal." Defendants' Deckert, 963 F. 2d at 819. Motion to Dismiss for Lack of Personal Jurisdiction (Docket Entry No. 8) is therefore GRANTED, and this action will be dismissed for lack of personal jurisdiction. SIGNED at Houston, Texas, on this the 18th day of April, 2018. LAKE UNITED STATES DISTRICT JUDGE 7 Plaintiff's Response, Docket Entry No. 14, pp. 3-4. 8 Id. 9 Texas Order, No. 8- 2 , p. 2 . Exhibit 2 to Motion to Dismiss, -4- Docket Entry
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