# Jerry Wilkerson v. RSL Funding, L.L.C.

> Texas Court of Appeals, 1st District (Houston) · August 11, 2011 · 388 S.W.3d 668

URL: https://www.frixlaw.com/law-library/cases/3127171

## Case

- **Full name:** Jerry WILKERSON, Appellant v. RSL FUNDING, L.L.C., Appellee
- **Court:** Texas Court of Appeals, 1st District (Houston)
- **Decided:** August 11, 2011
- **Citations:** 388 S.W.3d 668; 2011 Tex. App. LEXIS 6282; 2011 WL 3516147
- **Precedential status:** Published
- **Opinion:** Opinion
- **Judges:** Keyes, Sharp, Massengale
- **Cited by:** 7 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/3127171

## How later opinions describe it (automated extraction)

- holding that the unilateral activities of internet users who might use the search functions of 19 Yahoo! and Yelp to find business information in a particular geographic location cannot be the basis for exercising jurisdiction

## Opinion text

Opinion issued August 11, 2011
In The
Court of
Appeals
For The
First District
of Texas
————————————
NO. 01-10-01001-CV
———————————
Jerry Wilkerson , Appellant
V.
RSL Funding,
L.L.C. , Appellee
On Appeal from the 125th District Court
Harris County, Texas
Trial Court Case No. 2009-76347
O P I N I O N
In this
interlocutory appeal, Jerry Wilkerson appeals the trial court’s order denying
his special appearance. Appellee RSL
Funding, L.L.C. sued Wilkerson for defamation, libel, and business
disparagement, all based upon statements made by Wilkerson on third-party
internet sites. In his sole issue,
Wilkerson contends the trial court erred in denying his special appearance and
objection to jurisdiction. We find that
the trial court lacked jurisdiction, and we therefore reverse and render a
judgment of dismissal without prejudice.
Background
California resident Jerry Wilkerson
lives with his daughter, Trisha, who won the California state lottery. RSL Funding , L.L.C. is a financial services business that solicited Trisha by
mail, offering to pay her a lump sum in exchange for a portion of her future
lottery payments. Although RSL is
headquartered in Houston, evidence submitted to the trial court suggests that
the company advertised it had locations in New York, Chicago, Philadelphia,
Washington, D.C., Los Angeles, West Palm Beach, and Atlanta.
Trisha assigned a portion of her future lottery payments to
RSL in exchange for a lump-sum payment.
Wilkerson had no direct financial interest in his daughter’s
transaction. However, Trisha had a bad
experience dealing with RSL, and Wilkerson decided to post a review on the
internet to express his dissatisfaction.
He searched the internet for RSL, and he testified that he believed he
posted his comments on RSL’s website.
Rather than finding RSL’s own website, however, Wilkerson had found
third-party web pages containing basic business information about RSL. These websites permitted users to post
reviews about their experiences with featured businesses, and Wilkerson posted
negative reviews about RSL on two such web pages.
One of these websites was maintained by the internet search
engine Yahoo! (http://www.yahoo.com).
The Yahoo! evidence presented by RSL included two exhibits: Exhibit C,
which is an undated screenshot of part of a Yahoo! internet page, and Exhibit
D, which is one page of a two-page printout from Yahoo! dated March 18, 2010. [1] It is apparent from the face of each document
that neither of them is a complete copy of the represented internet page.
The evidence produced by RSL showed
that at the time the documents were prepared, a Yahoo! page relating to RSL
included contact information for RSL’s Houston office, including the address, a
map showing its location, and a photograph of the building. A representative of RSL authenticated this evidence by
attesting that proffered documents “are true and correct copies of the
originals,” but the affidavit does not explain what “originals” are depicted or
how they were generated. Each of
Exhibits C and D state at the top of the page: “Some details about this
business have recently been edited by the community.” There appears to have been a hyperlink that
would have allowed the user to “View changes,” but neither party introduced evidence
of what those changes were, when they were made, or who made them. The
user reviews section of the Yahoo! listing reflected that Wilkerson wrote:
This is by far the worst
experience I have had in my 64 years of life, dealing with all of the lies by
Jim Kelly and the non returned promised phone calls by Jim and Mr. Sanchez from
accounting. RSL has lied repeatedly to
us and misled us and have caused numerous delays in this project that still has
yet to be funded. Our experience shows
that there is nothing rapid about Rapid Settlements and they are so
unprofessional. Because of all the
problems with Rapid and their violating the contract, we are in the process of
a law suit against them and if there is anyone else out there who have had
similar experiences with [R]apid, please join us in a class action law
suit. I hate having to rate them with
even 1 star as they do not deserve any.
By the way, RSL represents themselves as a large company. Try calling any of their offices, N.Y., L.A.,
Atlanta etc and you will find that there are no offices there, only phone
numbers that are transferred to the Houston Office. Very clever and manipulating of them. Just goes to show how they really conduct
business, smoke and mirrors.
After his original review, Wilkerson posted two more
comments. The first comment stated:
RSL is still playing games
as they think they have us over a barrel.
So dishonest and disrespectful, will not even return a phone call. But the kicker is RSL has put out so much
negative Karma into the air that when their time comes, it will return to them
10 fold in a negative manner. I just
hope they remember where it came from and change their ways to treat people and
clients fairly and professionally.
Wilkerson’s
second comment to his Yahoo! review stated:
Received our check today and
now we are able to find out why RSL was so arrogant and mean and delaying
everything. They did not have the
money. The check is no good NSF, non sufficient
funds. Guess their word is as good as
their check.
The Yelp website (http://www.yelp.com)
contained a similar page with information about RSL. The evidence produced by RSL showed that at
the time Yelp was accessed for purposes of opposing Wilkerson’s special
appearance, the accessed page included RSL’s Houston address and a map. [2] That page reflected that Wilkerson had posted
another review which stated: “This is the worst company I have ever dealt with
in my life. Nothing but lies and misinformation . . . .” Subsequently, Wilkerson posted a comment to
his own review, which stated:
Received the check today
from RSL and guess what, it appears their word is as good as their
check[.] NSF NON SUFFICIENT FUNDS. I can see why they treated us so badly and
were so rude and inconsiderate and kept delaying, because they don’t have the
money. What a joke they are.
There is no evidence that Wilkerson had anything to
do with creating these webpages or their content other than the reviews and
subsequent comments submitted by him.
Furthermore, he testified in a deposition that he did not know how to
target a specific geographic location, and that he did not know how to attach a
map or photograph to his internet posting.
RSL sued
Wilkerson, alleging defamation, libel, and business disparagement. Wilkerson filed a special appearance,
objecting to the trial court’s jurisdiction over him. He supported his special appearance with an
affidavit stating he is a resident of California, does not own any property in
Texas, has never owned any business in Texas, has only traveled through Texas
once, and did not specifically direct any opinion or statement of fact
concerning RSL to anyone in Texas.
RSL
responded by claiming both websites used by Wilkerson “use geographic location
as the key to their respective search options” and are “intended to help a
searcher find information in specific geographic areas.” Based on these factual allegations, RSL
contends that Wilkerson purposely directed his actions at Texas, and therefore
he is subject to the jurisdiction of a Texas court for purposes of a tort claim
based on those actions. The trial court overruled
the special appearance, and Wilkerson brought this interlocutory appeal to
challenge the ruling.
Legal Standards for Personal Jurisdiction
Whether a court has personal
jurisdiction over a defendant is a question of law that we review de novo. BMC
Software Belg., N.V. v. Marchand , 83 S.W.3d 789, 794 (Tex. 2002); Glattly v. CMS Viron Corp. , 177 S.W.3d
438, 445 (Tex. App.—Houston [1st Dist.] 2005, no pet.). The plaintiff bears the initial burden of
pleading jurisdictional facts sufficient to bring a nonresident defendant
within the provisions of the Texas long-arm statute. Kelly
v. Gen. Interior Constr., Inc. , 301 S.W.3d 653, 658 (Tex. 2010). To establish jurisdiction over a nonresident
defendant, the plaintiff must plead a “connection between the defendant[’s]
alleged wrongdoing and the forum state.”
Id. at 655 . In a tort case, the plaintiff must plead that
the defendant committed a tortious act in Texas. Id .
at 659.
A nonresident defendant challenging
the court’s exercise of personal jurisdiction through a special appearance
bears the burden of negating all grounds for personal jurisdiction alleged by
the plaintiff. See, e.g. , Moki
Mac River Expeditions v. Drugg , 221 S.W.3d 569, 574 (Tex. 2007).
The defendant can negate jurisdiction on either a factual or legal
basis. Kelly , 301 S.W.3d at 659 . To
negate personal jurisdiction on a factual basis, the defendant may produce
evidence showing that it has no contacts with Texas, which the plaintiff may
then counter with its own evidence. Id.
To negate jurisdiction on a legal basis, the defendant may establish
that, even taking the alleged jurisdictional facts as true, “the defendant’s
contacts with Texas fall short of purposeful availment [of the forum] . . .
or that traditional notions of fair play and substantial justice are offended
by the exercise of jurisdiction.” Id.
Once the nonresident defendant has
presented evidence to disprove the jurisdictional allegations, the plaintiff
must then respond with its own evidence, and it risks dismissal of its lawsuit
if it cannot present the trial court with evidence establishing personal
jurisdiction. See Kelly , 301 S.W.3d at 659 ; Assurances
Generales Banque Nationale v. Dhalla , 282 S.W.3d 688, 695 (Tex. App.—Dallas
2009, no pet.). We review the trial
court’s determination de novo. See Moki Mac , 221 S.W.3d at 574 . If findings of fact and conclusions of law
are not issued, we infer “all facts necessary to support the judgment and
supported by the evidence.” See id .
“The Due Process Clause protects an
individual’s liberty interest in not being subject to the binding judgments of
a forum with which he has established no meaningful ‘contacts, ties, or
relations.’” Burger King Corp. v. Rudzewicz , 471 U.S. 462 , 471–72, 105 S. Ct.
2174 , 2181–82 (1985) (quoting Int’l Shoe
Co. v. State of Wash., Office of Unemployment Comp. & Placement , 326
U.S. 310, 319 , 66 S. Ct. 154, 160 (1945)).
A Texas court’s exercise of personal jurisdiction over a nonresident
defendant who allegedly committed a tort in the state is therefore limited by
constitutional due process requirements. [3] Unless the defendant consents to appear,
jurisdiction may be exercised over a nonresident defendant only when the
defendant has purposefully established such minimum contacts with the forum
state that the defendant could reasonably anticipate being sued there. See,
e.g. , Burger King , 471 U.S. at
475–76, 105 S. Ct. at 2183–84; World-Wide
Volkswagen Corp. v. Woodson , 444 U.S. 286, 297 , 100 S. Ct. 559, 567 (1980). The exercise of personal jurisdiction must
also comport with traditional notions of fair play and substantial
justice. See, e.g. , Burger King ,
471 U.S. at 475–76, 105 S. Ct. at 2183–84.
A nonresident defendant establishes
minimum contacts with Texas by purposefully availing himself of the privileges
of conducting activities in the state, thus invoking benefits and protections
of its laws. See, e.g. , Hanson v. Denckla ,
357 U.S. 235, 253 , 78 S. Ct. 1228, 1240 (1958); Michiana Easy Livin’ Country, Inc. v. Holten , 168 S.W.3d 777, 784
(Tex. 2005). We consider only the
defendant’s own contacts with the forum state, not the unilateral activities of
third parties. Burger King , 471 U.S. at 475 , 105 S. Ct. 2174 ; Michiana , 168 S.W.3d at 784 ; Kelly ,
301 S.W.3d at 660 . The contacts relied
upon must be purposeful, and not random, isolated, or fortuitous. Burger
King , 471 U.S. at 475 , 105 S. Ct. 2174 ; Keeton
v. Hustler Magazine, Inc. , 465 U.S. 770, 774 , 104 S.Ct. 1473 (1984); Michiana , 168 S.W.3d at 785 . When undertaking a minimum-contacts analysis,
we consider the quality and nature of the defendant’s contacts, rather than
their number. Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C. ,
815 S.W.2d 223 , 230 n.11 (Tex. 1991).
The defendant’s activities, whether they consist of acts inside or
outside of Texas, must justify a conclusion that the defendant could reasonably
anticipate being called into a Texas court.
See World-Wide Volkswagen , 444
U.S. at 287 , 100 S. Ct. at 562 ; Am. Type
Culture Collection, Inc. v. Coleman , 83 S.W.3d 801, 806 (Tex. 2002). Although it is not determinative,
foreseeability is an important consideration in deciding whether the
nonresident has purposefully established minimum contacts with the forum
state. Burger King , 471 U.S. at 474 , 105 S. Ct. at 2183 .
The minimum contacts analysis is
further divided into specific jurisdiction based on contacts giving rise to a
claim and general jurisdiction based solely on the extent of the defendant’s
contacts with the forum state. BMC Software , 83 S.W.3d at 795–96. RSL does not argue that the trial court could
exercise general jurisdiction over Wilkerson.
We therefore confine our analysis to specific jurisdiction.
Analysis
On appeal, Wilkerson contends that
there is legally insufficient evidence that he purposefully availed himself of
the privileges of conducting activities in Texas. In particular, he contends that there is no
evidence he directed his comments about RSL toward Texas and that any contact
his comments did have with Texas was merely fortuitous. Accordingly, Wilkerson argues that RSL failed
to satisfy its burden to present evidence tending to establish
jurisdiction. Though he characterizes it
as a legal challenge, his dispute is a factual one because he countered RSL’s
factual allegation that the internet postings were directed at Texas with
evidence that they were not. See Kelly ,
301 S.W.3d at 659 . Because Wilkerson
negated RSL’s jurisdictional claims, RSL was required to respond with evidence
affirming its allegations. Id.
We therefore must determine whether RSL adequately responded with
evidence to establish jurisdiction, inferring any facts necessary to support
jurisdiction that are supported by that evidence. See
Moki Mac , 221 S.W.3d at 574 .
RSL, in response, argues that the
evidence demonstrates that Wilkerson directed his statements towards
Texas. It relies on its factual
allegations that Wilkerson’s statements were published “on internet interactive
websites which were specifically aimed at a Texas limited liability company,
RSL, located in the Galleria area of Houston, Texas, and its employee, a Texas
resident,” and that Wilkerson posted his comments to “www.local.yahoo.com” and “www.yelp.com,”
sites alleged by RSL to “use geographic location as the key to their respective
search options.” RSL alleges that
Wilkerson’s “stated motivation . . . was that he was ‘trying to
drum up a class action lawsuit’” and that Wilkerson’s statements were “part of
a calculated scheme to destroy RSL’s business.”
It also argues that Wilkerson’s internet comments “constitute a
substantial presence in the State of Texas,” and that jurisdiction should be
exercised over him “based on the effects of his California conduct in Texas.”
I.
Inapplicability
of “sliding scale” standard to individual website user
The dispute presents a question of
when personal jurisdiction may be exercised over a defendant based solely upon
his use of the internet. Both Wilkerson
and RSL suggest that we should use the “sliding scale” analysis often used to
evaluate whether jurisdiction may be exercised over a nonresident defendant
based on the relative interactivity of its website. [4] However, to the extent that the interactive
features of Yahoo! and Yelp are the creations of the owners and operators of
those websites, the interactive nature of a large - scale ubiquitous internet presence cannot be fully imputed to an
individual user such as Wilkerson for the purpose of determining whether he established
minimum contacts with Texas sufficient to justify exercising jurisdiction over
him. Most Texas cases which apply the
sliding-scale jurisdictional analysis to claims based upon internet usage arise
from a nonresident defendant’s ownership and operation of its own website. [5] The analysis of a website’s interactivity is
not as useful when determining whether due process permits jurisdiction to be
exercised over a third-party individual user of the website. [6]
While the websites at issue in this
case may themselves be considered interactive, a third party’s use of the
website may, in effect, be a “passive” usage of the internet, i.e. an act of simply
posting information which is accessible anywhere the internet is
accessible. Such passive usages of the
internet do not support jurisdiction over a non-interactive website under a
sliding-scale analysis. [7] Likewise, because the contacts supporting the
exercise of jurisdiction must be purposeful, and not random, isolated, or
fortuitous, jurisdiction nor should not be based solely upon the passive, non-targeted
postings of an individual website user. See, e.g. , Burger King , 471 U.S. at 475 , 105 S. Ct. 2174 ; Michiana , 168 S.W.3d at 784 . To conclude otherwise and uncritically
evaluate an individual website user’s contacts with the forum state based on
interactive website features implemented by third-party website operators would
also violate the principle that the relevant contacts are those of the
defendant himself, and not the unilateral acts of third parties. See,
e.g. , Burger King , 471 U.S. at 475 ,
105 S. Ct. 2174 ; Michiana , 168 S.W.3d
at 785 .
In this case, Wilkerson did not own
Yahoo! or Yelp, and the record contains no evidence that he exercised any
control over the content of these websites other than his contribution of
reviews and comments. Thus for purposes of analyzing personal
jurisdiction over an individual in a case arising from his internet activity , we decline to reflexively apply the
sliding-scale analysis of the interactivity of a commercial internet website to
determine jurisdiction over the individual website user. Instead, we apply the constitutional standard
of purposeful availment. See Hanson ,
357 U.S. at 253 , 78 S. Ct. at 1240 ; Michiana ,
168 S.W.3d at 784 .
II.
Application
of purposeful availment standard
Our conclusion that the full range
of a website’s interactive features should not be automatically imputed to an
individual user when evaluating his minimum contacts with the forum does not
preclude a showing that the individual user intentionally used a website’s
features to target a particular location under circumstances constituting
purposeful availment. Cf . Keeton , 465 U.S. at 781 , 104 S. Ct. at 1481 (1984) (state
properly exercised personal jurisdiction over libel claim against nonresident
magazine publisher that “continuously and deliberately exploited” forum state’s
market); Calder v. Jones , 465 U.S.
783 , 789–90, 104 S. Ct. 1482 , 1486–87 (1984) (state properly exercised personal
jurisdiction over libel claim against nonresident journalists based on effects
of publication in forum state when journalists were aware that forum state was
location of publication’s largest circulation).
Accordingly we must evaluate RSL’s contention that Wilkerson
specifically directed his negative postings on Yahoo! and Yelp toward Texas.
A. Website characteristics
RSL argues that Wilkerson
purposefully availed himself of the benefits and protections of the laws of
Texas by publishing his comments on websites which were “specifically aimed at
a Texas limited liability company, RSL, located in the Galleria area of
Houston, Texas, and its employee, a Texas resident,” and that Wilkerson posted
his comments to sites alleged by RSL to “use geographic location as the key to
their respective search options.”
RSL produced no evidence to support its allegation that Wilkerson
used “www.local.yahoo.com” to
publish his comments in some fashion specifically associated with Houston. There is only evidence that RSL printed out a
Yahoo! webpage that included a “local” reference in its web address (i.e. its
uniform resource locator, or URL). The
evidence that Wilkerson’s comment was associated with Houston-related content
on Yahoo! is not evidence that Wilkerson was responsible for that association,
particularly if RSL or its Houston-based attorneys prepared the evidence of
what appears on Yahoo! from their Houston-located computers. [8] Nevertheless, based on the “local” URL
reflected in the printout submitted to the trial court, RSL argues without
record citations or any competent evidentiary support:
The “local” name used by local.yahoo.com serves as a key clue on what
is intended with the information provided.
That is, it is intended to help you find information in specific
geographic areas. More likely than not
it will be residents of the Houston area in particular, or Texas residents in
general, that will search RSL Funding located in Houston Texas.
Even
if RSL’s assertion in this regard is true, the geography related to the
intentions of the website operator or a hypothetical web searcher, without
more, is not relevant to our analysis of whether Wilkerson had the minimum
contacts with Texas necessary to support jurisdiction in this case. [9]
While the evidence presented by RSL
shows that Yahoo! and Yelp maintain webpages containing business listings for
the Houston office of RSL, that evidence does not demonstrate that the websites
themselves “aim at” any entity or person in Texas, or that they otherwise
target Texas residents. And we may not
consider the actions of Yahoo! and Yelp to use geographic location to
facilitate searches performed by other users unrelated to this dispute. The unilateral activities of the website
operators cannot be the basis for exercising personal jurisdiction over an
individual user. See, e.g. , Burger King ,
471 U.S. at 475 , 105 S. Ct. 2174 ; Michiana ,
168 S.W.3d at 784 . Likewise, the
unilateral activities of internet users who might use the search functions of
Yahoo! and Yelp to find business information in a particular geographic
location cannot be the basis for exercising jurisdiction over Wilkerson in this
case.
In any case, even if the evidence
showed that Yahoo! and Yelp targeted Texas, standing alone that evidence would
not establish that Wilkerson knew or should known have his comments posted on
Yahoo! and Yelp were targeting Texas or any other specific geographic location. [10] Without evidence of the defendant’s knowledge
or reasons to know of the website’s activities to target a specific geographic
area, imputing those activities to the defendant would be the same as
subjecting him to jurisdiction based the unilateral actions of others.
RSL presented no evidence about how
Wilkerson posted his comments in a way directed at Texas. It merely created some printouts of the web
pages at issue and submitted them to the trial court without any demonstration
of the origins of the depicted information that it now relies upon to claim
that Wilkerson was targeting Texas. [11] The only competent evidence on that subject
was Wilkerson’s own deposition testimony that he conducted an internet search
and posted comments on what he thought were websites operated by RSL. Wilkerson specifically denied targeting
Texas; RSL produced no evidence tending to show that is not true. The evidence therefore does not support RSL’s
factual allegation, factually refuted by Wilkerson, that Wilkerson deliberately
used a website oriented towards, aiming at, or otherwise specifically targeting
Texas.
B.
Website content
RSL
argues that because the websites, in addition to Wilkerson’s comments,
contained a photograph of RSL’s building, a Houston address, and a map showing
RSL’s location in Houston, Wilkerson purposefully directed his conduct at the
forum of Texas. RSL’s brief goes so far
as to state that “Wilkerson even provided a map and a photo of RSL’s Galleria
location in his posting.” But that is
not what the evidence submitted by RSL shows.
Once again, the only evidence
produced by RSL to support its factual allegations are its own printouts from
the Yahoo! and Yelp webpages. Those
printouts are evidence of the substance of Wilkerson’s comments, the authorship
of which he does not dispute. But they
are not evidence that Wilkerson supplied any information about RSL other than
the text of his comments, such as an address, a map, a photograph, or any other
content which websites such as Yahoo! and Yelp routinely compile on their own
and combine with user-submitted content. [12] For this reason, the evidence submitted by RSL would
not support a conclusion that the photograph, Houston address, or map were
directly caused by Wilkerson to appear on the webpages, or that Wilkerson even
deliberately associated his comments with those elements of the webpages. Indeed,
in his deposition Wilkerson disclaimed doing any such thing, and that is the
only competent evidence on the subject that was presented to the trial
court.
Likewise,
the aspects of RSL’s evidence reflecting other localized Houston content is not
evidence that Wilkerson deliberately associated his comments with a
Houston-oriented aspect of either Yahoo! or Yelp. Again, Wilkerson denied doing that, and he
also specifically denied knowledge of how to do any such thing. The fact that Houston-based RSL represented
by Houston-based attorneys obtained Houston-oriented content when accessing
Yahoo! and Yelp is no evidence of what Wilkerson saw, did, or intended when he
posted his comments. The present-day
reality of the ever-evolving internet is that the content seen by any
particular user is often customized by the website based on the geographic
location of the person viewing the website, or the geographic location of the
same person’s computer servers, or other characteristics associated with the
person visiting the webpage.
Jurisdiction therefore may not be exercised over a nonresident user
based on his use of a website based upon the mere evidence that the website incorporated
Texas-related content of an unknown origin, particularly when that evidence
only shows the website’s content as viewed by a different user at a later time
in a presumably different location.
C. Substance of internet communications
In a personal jurisdiction
analysis, only the nonresident defendant’s own purposeful contacts with Texas
are considered. See, e.g. , Burger King , 471 U.S. at 475 , 105 S. Ct. at 2183–84; Michiana , 168 S.W.3d at 785 . Thus,
because RSL is not relying upon any other alleged contacts between Wilkerson
and the state of Texas, our jurisdictional inquiry is limited to whether
Wilkerson’s internet commentary alone was sufficient to justify a Texas court
exercising specific jurisdiction over him.
RSL
has presented no evidence that Wilkerson’s comments were purposefully directed
at Texas, as would be required for him to be subject to suit in Texas. [13] The evidence merely shows that he performed
an internet search for RSL, and that he posted reviews and comments on two
different websites where he found an opportunity to do so. Wilkerson
made only one express reference to RSL’s presence in Texas, stating in his
Yahoo! review that phone calls made to offices other than RSL’s Houston office
are transferred to Houston. Although he
mentioned two employees by name, he did not identify where those employees
work. [14] RSL’s evidence shows nothing to the
contrary. RSL produced no competent
evidence about the circumstances of Wilkerson’s postings obtained from Yahoo!
or Yelp or from any other source to support their contention that Wilkerson
specifically targeted Texas with his comments, and Wilkerson’s testimony about
his actions directly contradicts RSL’s allegation.
RSL also argues that Wilkerson’s
purposeful availment of Texas is demonstrated by his solicitation of Texas
residents to join in a lawsuit against RSL.
However, that comment did not mention where the alleged lawsuit was
filed or intended to be filed, nor did it indicate in any way that Texas
residents were being recruited as opposed to any other disgruntled client of
RSL. [15] The reviews and subsequent comments suggest
that Wilkerson was addressing a global internet audience of potential RSL
clients, not exclusively or primarily Texas residents. Moreover, nothing in the record shows that
Wilkerson sought any benefit, advantage, or profit by availing himself of
Texas, as is required for personal jurisdiction. See
Michiana , 168 S.W.3d at 785 . He was
not part of the transaction between RSL and his daughter, nor did he have any
direct financial interest in it.
D. Effect of internet communications
Finally, RSL suggests that
Wilkerson’s postings constitute a substantial presence in Texas, the effect of
which is sufficient to justify exercising jurisdiction over him. In support of this argument that jurisdiction is proper based
on the Texas effects of Wilkerson’s comments, RSL asserts: “Those likely to be
searching for RSL (or for relevant keywords) will be looking for such in
Houston, Texas. Regardless, the search
results will come up as being categorized in Houston, Texas.”
Apart from the consideration that
we cannot consider the unilateral acts of others in conducting our analysis, see, e.g. , Burger King , 471 U.S. at 475 , 105 S. Ct. at 2183–84, we note also
that jurisdiction may not be based solely on the effects or consequences in the
forum state resulting from allegedly tortious conduct. See Michiana ,
168 S.W.3d at 789 (citing National Indus.
Sand Ass’n v. Gibson , 897 S.W.2d 769, 773 (Tex. 1995)). “Instead, it is ‘the defendant’s conduct and
connection with the forum’ that are critical.”
Id . (quoting Burger King , 471 U.S. at 474 , 105 S. Ct.
at 2183 ). Thus, in Calder v. Jones , the United States Supreme Court justified the
exercise of jurisdiction over nonresident reporters in a libel case based upon
the extent of the defendants’ activities (knowingly reporting for a publication
which sold over 600,000 weekly copies in the forum state) and not merely the
residence of the plaintiff. See 465 U.S. 783 , 785 n.2, 104 S. Ct.
1482 ; see also Michiana , 168 S.W.3d at
789 .
In this case, Wilkerson has no
record of continuously and knowingly directing internet commentary toward an
identifiable Texas audience, such as would be necessary to analogize the
circumstances to Calder . We therefore conclude that the comments’
alleged effects in Texas are inadequate to justify exercising jurisdiction in
the absence of other evidence demonstrating Wilkerson’s minimum contacts with
the forum.
* * *
The evidence attached to Wilkerson’s
special appearance negated all grounds for personal jurisdiction alleged by
RSL. That evidence showed that
Wilkerson’s online postings, which were made available to anyone interested in
them, were not specifically directed towards Texas, and therefore do not
support exercising jurisdiction over this case. [16] The burden then shifted to RSL to present
evidence that personal jurisdiction properly could be exercised over Wilkerson. See
Kelly , 301 S.W.3d at 659 . As
explained above, none of the evidence produced by RSL was factually sufficient
to satisfy its burden. On the record before us we have no
basis to conclude that RSL’s evidence of the websites’ content is evidence of what
Wilkerson saw when he posted his comments. Given
that there is no evidence that Wilkerson exercised control over or intended what
was included on Yahoo! and Yelp other than his comments, there is no factual
basis upon which the inclusion of localized content could be imputed to him. Accordingly, considering the overall quality
and nature of Wilkerson’s contacts as demonstrated by the evidence presented,
we conclude the trial court erred in denying Wilkerson’s special appearance.
Conclusion
We reverse
the judgment of the trial court and render a judgment of dismissal without
prejudice for lack of personal jurisdiction.
Michael
Massengale
Justice
Panel consists of Justices Keyes, Sharp, and
Massengale.
Justice Keyes, dissenting.
[1] The last
of Wilkerson’s Yahoo! postings was dated November 20, 2009. RSL’s original petition alleging defamation,
libel, and business disparagement by both of the Wilkersons was filed on
November 25, 2009.
[2] Although
presented as two separate one-page documents labeled Exhibits E and F, it
appears from the header and footer of the two pages that RSL’s evidence from
Yelp consists of one two-page printout generated on May 18, 2010 at 3:15 pm — approximately six months after Wilkerson’s two Yelp
postings dated November 16 and 20, 2009.
As with the Yahoo! evidence, RSL provided no evidence about the
circumstances of the creation of the documents.
[3] Pursuant to the long-arm statute, Texas
courts can exercise personal jurisdiction over a nonresident defendant that
“does business” in Texas. Tex. Civ. Prac. & Rem. Code Ann. §
17.042 (West 2008); BMC Software Belg.,
N.V. v. Marchand , 83 S.W.3d 789, 795 (Tex. 2002). Among other actions identified by the
long-arm statute, a nonresident is considered to be “doing business” in Texas
if he “commits a tort in whole or in part in this state.” Tex.
Civ. Prac. & Rem. Code Ann. § 17.042(2); Moki Mac , 221 S.W.3d at 574 .
[4] For purposes of establishing personal
jurisdiction in cases involving internet usage, several Texas courts have used
the “sliding scale” analysis first utilized in Zippo Manufacturing Co. v. Zippo Dot Com, Inc. , 952 F. Supp. 1119
(W.D. Pa. 1997). See, e.g. , Choice Auto
Brokers, Inc. v. Dawson , 274 S.W.3d 172 , 177–78 (Tex. App.—Houston [1st
Dist.] 2008, no pet.); Karstetter v. Voss ,
184 S.W.3d 396, 404 (Tex. App.—Dallas 2006, no pet.); Experimental Aircraft Ass’n, Inc. v. Doctor , 76 S.W.3d 496, 507
(Tex. App.—Houston [14th Dist.] 2002, no pet.).
The court in Zippo observed
that “the likelihood that personal jurisdiction can be constitutionally
exercised is directly proportionate to the nature and quality of commercial
activity that an entity conducts over the Internet.” Zippo ,
952 F. Supp. at 1124 . At one end of the
range of activity, personal jurisdiction may be exercised over a nonresident
defendant “clearly does business” in the forum over the internet, such as by
entering into a contract with a forum resident involving the knowing and
repeated exchange of data over the internet.
Id . At the opposite end of the spectrum, personal
jurisdiction may not be exercised over a nonresident based solely upon
maintenance of a “passive” website when it has simply posted information on a
website which is accessible to users in the forum. Id . The “middle ground” in the Zippo sliding-scale analysis is occupied
by “interactive” websites permitting users to exchange information with the
host computer. Id . The exercise of personal
jurisdiction over a nonresident defendant operating such a website depends upon
“the level of interactivity and commercial nature of the exchange of
information that occurs” on the site. Id .
[5] See,
e.g. , Choice Auto Brokers , 274 S.W.3d at 178 ; Michel v. Rocket Eng’g Corp. , 45 S.W.3d 658 (Tex. App.—Fort Worth
2001, no pet.); Experimental Aircraft
Ass’n , 76 S.W.3d at 507 ; see also
Mink v. AAAA Dev. LLC , 190 F.3d 333 ,
336–37 (5th Cir. 1999) (applying Texas law).
But see Karstetter , 184 S.W.3d at 405 (applying sliding-scale standard to
evaluate eBay internet auction site when claim was asserted against seller
utilizing site).
[6] See, e.g. , McGuire v. Lavoie , No. Civ.A. 3:03-CV-0161-BH, 2003 WL 23174753 ,
at *3 (N.D. Tex. Aug, 19, 2003) (“Because the majority of cases applying the
[sliding scale] test involve a defendant’s conduct over its own website, its
application to an internet auction site is questionable.”); Action Tapes, Inc. v. Weaver , No. Civ.
3:05-CV-1693-H, 2005 WL 3199706 , at *2 (N.D. Tex. Nov. 23, 2005) (“The sellers
and buyers who connect through eBay cannot be said themselves to control eBay’s
degree of commercial interactivity. . . .
Accordingly, the ‘sliding scale’ standard is not applicable in this
case.”); Attaway v. Omega , 903 N.E.2d
73, 78 (Ind. Ct. App. 2009) (“[The sliding scale] mode of analysis makes little sense in the eBay context since eBay, and not
the user, controls the interactivity and marketing efforts of the website.”); Foley v. Yacht Mgmt. Grp., Inc. , No. 08
C 7254, 2009 WL 2020776 , at *3 n.1 (N.D. Ill. July 9, 2009) (declining to apply
sliding-scale approach and instead applying traditional analysis focusing on
purposeful availment of forum).
[7] See, e.g. , Zippo , 952 F. Supp. at 1124 ; Choice Auto Brokers , 274 S.W.3d at 177–78.
[8] See generally Kevin F. King, Personal Jurisdiction, Internet Commerce,
and Privacy: The Pervasive Legal Consequences of Modern Geolocation
Technologies , 21 Alb. L.J. Sci.
& Tech. 61 , 73–75 (2011) (explaining how websites utilize
geolocation tools to “modify generic content . . . to highlight aspects that
are most relevant to a user’s specific location”).
[9] In a
somewhat similar vein, the dissent repeatedly and emphatically refers to Yahoo!
and Yelp as “local websites,” as if Wilkerson’s postings appeared in the
internet equivalent of a local newspaper.
The evidence does not support that characterization. Even to the extent we might take judicial
notice that Yahoo! and Yelp organize some of their content to associate it with
a particular locality, no evidence was produced in the trial court that
Wilkerson associated his comments with Houston-specific content on those
websites or that he deliberately used Yahoo! or Yelp anticipating that those
websites would do it for him. Indeed the
only evidence on this subject, Wilkerson’s testimony, was to the contrary.
[10] Indeed, the substance of Wilkerson’s
communication indicates that he was addressing a more generalized and
nontargeted audience of RSL’s past, current, or future clients who believed
based on RSL’s advertising that it had offices in places other than
Houston. As noted above, he wrote
on Yahoo!: “ Try calling any of their
offices, N.Y., L.A., Atlanta etc and you will find that there are no offices
there, only phone numbers that are transferred to the Houston Office. ”
[11] The
deficiency in RSL’s evidence is one of substance, not form, because it does not
establish that Wilkerson’s actions were purposefully or deliberately directed
at Texas. Proof that Wilkerson’s comments
were ultimately associated with a webpage that included “local” in its URL is
only relevant if the evidence shows that Wilkerson intentionally directed his
comments to a local website. RSL
produced evidence of what it found without producing evidence that reflects what
Wilkerson did when he posted his comments.
[12] Although
not part of the evidentiary record, it is common knowledge, and we thus take
judicial notice, that websites such as Yahoo! and Yelp commonly repackage and
republish user contributions along with other information like the maps,
addresses, photographs, and other identifying characteristics relied upon by
RSL. See
Yahoo! Terms of Service , Yahoo!, at
§ 9 (Nov. 24, 2008),
http://info.yahoo.com/legal/us/yahoo/utos/utos-173.html (providing that users
submitting content to Yahoo! grant the website operator a license to “to use,
distribute, reproduce, modify, adapt, publish, translate, publicly perform and
publicly display such Content (in whole or in part) and to incorporate such
Content into other works in any format or medium now known or later
developed”); Terms of Service , Yelp, at § 5(B) (July 21, 2010),
http://www.yelp.com/static?p=tos (“We may use Your Content in a number of
different ways, including publicly displaying it, reformatting it,
incorporating it into advertisements and other works, creating derivative works
from it, promoting it, distributing it, and allowing others to do the same in connection
with their own websites and media platforms . . . .”).
[13] See, e.g. , Shrader v. Biddinger , 633 F.3d 1235, 1244 (10th Cir. 2011)
(“defamatory postings may give rise to personal jurisdiction if they are
directed specifically at a forum state audience or otherwise make the forum
state the focal point of the message”).
[14] In any case, simply referencing Texas or
Texas residents is not sufficient to demonstrate that Texas was specifically
targeted by the allegedly tortious statements.
See, e.g. , Johnson v. Arden , 614 F.3d 785, 796 (8th
Cir. 2010) (no targeting of Missouri sufficient to support exercise of specific
personal jurisdiction based upon allegedly defamatory internet posting stating
that “Sue Johnson [a Missouri resident] and Cozy Kittens [a Missouri limited
liability company] operated from Unionville, Missouri, where they killed cats,
sold infected cats and kittens, brutally killed and tortured unwanted cats and
operated a ‘kitten mill’ in Unionville, Missouri.”).
[15] In his
deposition, Wilkerson testified that there was no lawsuit. He said, “I was just trying to drum up some
business for a class action lawsuit possibly after reading the reviews and
reading past histories of RSL.” He was
not asked whether this comment was directed toward Texas residents, and
considering that he lives in California, the comment itself is not evidence
suggesting that Texas residents were targeted by his solicitation of support
for a lawsuit.
[16] See, e.g. , Machulsky v. Hall , 210 F. Supp. 2d 531, 542 (D.N.J. 2002) (buyer’s
negative eBay feedback about seller was not purposefully directed toward
seller’s home state of New Jersey); Bailey
v. Turbine Design, Inc. , 86 F. Supp. 2d 790, 796 (W.D. Tenn. 2000) (holding
defamatory statements posted on defendant’s website attacked plaintiff as a
nationwide competitor in aircraft conversions, not as a Tennessee businessman);
English Sports Betting, Inc. v. Tostigan ,
No. CIV.A. 01-2202, 2002 WL 461592 , at *3 (E.D. Pa. Mar. 15, 2002) (stating
that “[t]here is a difference between tortious conduct targeted at a forum
resident and tortious conduct expressly aimed at the forum,” and holding that
defamatory statements published online did not target Pennsylvania, the forum
state); Archer & White, Inc. v. Tishler , No. CIV.A.3:03-CV-0742-D, 2003 WL 22456806 , at *3 (N.D. Tex. Oct. 23,
2003) (allegedly defamatory statement on third-party website about seller of
dentist’s drills was not directed at Texas, where Texas-based seller made most
of its sales).

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/3127171. Public record. Not legal advice.