Norton Rose Fulbright obtains significant win in Texas state appellate court

United States Press release - Business May 2024

A Norton Rose Fulbright litigation team representing Opus IVS, Inc., a Michigan-based provider of remote automotive diagnostic and programming services, recently prevailed in the Dallas Court of Appeals, which affirmed a trial court’s order dismissing the plaintiffs’ claims against Opus because Opus was not subject to personal jurisdiction in Texas.

The decision, Repairify, Inc. v. Opus IVS, Inc., No. 05-23-00921-CV, 2024 WL 2205663 (Tex. App.—Dallas May 16, 2024, no pet. h.), marks the first time a Texas state appellate court has addressed the impact of the United States Supreme Court’s decision in Mallory v. Norfolk Southern Railway Co., 600 U.S. 122 (2023). In Mallory, the US Supreme Court concluded that Pennsylvania’s business-registration statute—which expressly provided that registered foreign corporations consented to the personal jurisdiction of Pennsylvania courts—did not violate the Due Process Clause of the Fourteenth Amendment.

At issue in Repairify was whether, following Mallory, a foreign corporation that registers to do business in Texas also consents to the personal jurisdiction of Texas courts. After Opus hired a former employee of Repairify, Inc. and Repairify Holdings, LLC (“Repairify”), Repairify sued Opus in Texas. Opus then filed a special appearance, arguing it was not subject to personal jurisdiction in Texas. The trial court granted Opus’s special appearance, and Repairify appealed. Though Opus was a foreign corporation, Repairify cited Mallory in support of its contention that Opus had consented to Texas courts’ jurisdiction by registering to do business in Texas. Repairify also asserted that Opus was subject to general and specific jurisdiction in Texas.

The Dallas Court of Appeals concluded that Mallory merely addressed whether a consent-to-jurisdiction statute like Pennsylvania’s comported with Due Process and did not affect the court of appeals’ interpretation of Texas’s registration scheme for foreign corporations. Accordingly, the court of appeals adhered to its prior determination that being registered to do business and having a registered agent in Texas only potentially subjected a foreign corporation to jurisdiction in Texas. The court of appeals also distinguished the relevant Texas statutes from the Pennsylvania law in Mallory, noting that they lacked language indicating that compliance with them constituted consent to personal jurisdiction. After disposing of the consent argument, the court of appeals went on to determine that Opus was not subject to specific or general jurisdiction in Texas. The court of appeals affirmed the trial court’s judgment.

Justin VandenBout, Warren Huang, Charlotte Kelly and Patrick Doyle comprised Norton Rose Fulbright’s team.