Martinez et al v. Angel Exploration, LLC et al

Filing 36

Memorandum Opinion and Order - Dft's motions to transfer are granted. This case is transferred in it entirety to the Western District of Oklahoma. The other pending motions will not be ruled on by this Court. (Ordered by Judge Mary Lou Robinson on 4/11/2013) (plh) [Transferred from Texas Northern on 4/11/2013.]

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
AMARILLO DIVISION
$

JESUS and

KANDA MARTINEZ.

$
$

Plaintiffs,

$

$

v.

NO.2:12-CY-265

$

ANGEL EXPLORATION, LLC and
NATURAL GAS SPECIALISTS INC.,

$
$

Defendants.

$

MEMORANDUM OPINION AND ORDER
Four motions are before the Court: Defendant Angel Exploration's Motion to Dismiss or,

in the Alternative, to

Transfer; Defendant Natural Gas Specialists' Motion to Dismiss for

Improper Venue or, in the Alternative, to Transfer; Angel's Motion to Dismiss under Federal

Rule

of Civil Procedure I2(b)(6); and Defendants' Joint Motion for

Responsible Third Party. For the following reasons, this case

will

Leave

to Designate

be transferred to the Western

District of Oklahoma, and all other pending motions will not be ruled on by this Court.

BACKGROUND
Jesus Martinez

is a resident of Texas and an employee of Smith Contract Pumping,

a

Texas company. His thumb was cut off while he was servicing a petroleum well in Oklahoma

owned by Angel Exploration. Angel has contracted with Smith to service Angel's wells for
about 25 years.

All of Angel's wells

are in Oklahoma. Martinez sued Angel for negligence and

premises liability; and Natural Gas Specialists (NGS), another servicer

of the well, for

negligence. Both Angel and NGS are Oklahoma-registered entities, Neither company owns
property in Texas. Neither has an agent here.
Page 1

of10

Angel seeks dismissal under Rule 12(b)(2). Angel asserts that its contacts with Texas are
insufficient for the Court to exercise personal jurisdiction over

it and that jurisdiction can be

shown in no other way. NGS has not challenged personal jurisdiction. However, both Angel
and NGS seek dismissal for improper venue under Rule 12(b)(3) or 28 U.S.C. $ 1a06(a) or, in

the alternative, transfer of this matter to the Western District of Oklahoma under

28

U.S.C. $ 1a06(a) or 1404(a).

Angel additionally seeks dismissal under Rule 12(b)(6) on the ground that Martinez fails

to state a claim for which relief can be granted because his claim is barred by

Oklahoma

worker's compensation laws.

LEGAL STANDARDS
Rur.B I2(b)(2)

When challenging a court's in personan jurisdiction, a plaintiff need only make

a

prima

facie showing of predicate facts. Any contested facts must be resolved in favor ofjurisdiction.
McFadin v. Gerber,587 F.3d 753, 758 (5th Cir. 2009). Because the Texas long-arm statute
extends to the

limit of the Fourteenth Amendment's Due

Process Clause, federal courts applying

the statute only consider whether the exercise of personal jurisdiction comports with
Constitution. Id. at 759. Personal jurisdiction will be found

if

the

the plaintiff shows that the

defendant "purposefully availed himself of the benefits and protections of the forum state by

establishing minimum contacts" there and that "the exercise of personal jurisdiction over that
defendant does not offend traditional notions of fair play and substantial

justice."

Id. If a

defendant's business contacts with the forum state are continuous and systematic, a forum court

can exercise general jurisdiction over the defendant whether the action arises from
Page 2

of

10

the

Id. If the defendant's forum contacts are less

defendant's contact with the forum state or not.

than continuous and systematic, the court may exercise specific jurisdiction

if suit arises out of or

is related to those contacts. Id.

A court

analyzes three factors when determining specific

jurisdiction: "(1) whether the

defendant has minimum contacts with the forum state, i.e., whether

it purposely

directed its

activities toward the forum state or purposefully availed itself of the privileges of conducting
activities there; (2) whether the plaintiff s cause of action arises out

of or

results from the

defendant's forum-related contacts; and (3) whether the exercise of personal jurisdiction is fair
and reasonable."

Id. No one element is decisive" and courts

should determine whether the facts

demonstrate that the defendant reasonably anticipates suit in Texas. "The defendant must not be
haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the

unilateral activity of another party or third person." Id.

Rurp 12(bX3)
"Rule 12(bX3) and $ 1a06(a) provide for dismissal or transfer of an action that has been
brought in an improper venue.

"

In re Atl. Marine Const. Co., lnc.,701 F.3d 736,739 (5th Cir.

2012). Once a defendant has objected to venue, the burden shifts to the plaintiff to establish that
venue is proper. In doing so, the Court "must accept as true all allegations in the complaint and
resolve all conflicts in favor of the plaintiff." Braspetro Oil Servs. Co. v. Modec (USA), lnc.,240

F. App'x 612,615 (5th Cir.2007) (citing Murphyv. Schneider Nat'1, lnc.,362 F.3d 1133, 1138

(9th Cir. 2004)). However, in its analysis,

oothe

court is permitted to look at evidence in the

record beyond simply those facts alleged in the complaint and its proper attachments," Ginter ex

rel. Ballard v. Belcher, Predergast & Laporte,536 F.3d 439,449 (5th Cir. 2008).

Page 3

of

10

28 U.S.C. $ 1406(a)

Under 28 U.S.C. $ 1406(a), when venue is found to be improper, "[t]he district court ...
shall dismiss, or

if it

be in the interest of justice, transfer such case to any district or division in

which it could have been brought." 28 U.S.C. $ la06(a). If venue is improper,
has broad discretion

justice." Cald,vell

in determining whether to dismiss or transfer a

v. Palmetto State Savs. Bank of S.C. , 81

I

F

case

'oa

district court

in the interest of

.2d 916, 919 (5th Cir. 1987).

PERSONAL JURISDICTION OVER ANGEL EXPLORATION
Angel is not subject to general jurisdiction in Texas. Its only Texas contacts are directed
at Oklahoma operations: it has purchased goods and services-including its long-term contract

with Smith-from Texas providers, but only to operate Oklahoma wells, Purchasing goods and
services of Texas companies does not make Angel at home here. See Goodyear Dunlop Tires

Operations, S.A. v. Brown,

l3l

S. Ct. 2846. 2855-57 (2011); Helicopteros Nacionales de

Colombia, S.A. v. Hall,466 U.S. 408,418 (1984) (oomere purchases, even

intervals, are not enough to warrant a State's assertion
nonresident corporation

in a cause of

if occurring

at regular

of in personom jurisdiction over a

action not related

to those purchase transactions.").

General jurisdiction is inapplicable.

Martinez must show three things

to

establish that this Court can exercise personal

jurisdiction over Angel: "(1) the defendant has purposely directed its activities toward the forum
state

or purposefully availed itself of the privileges of conducting activities there; (2)

the

plaintiffls cause of action arises out of or results from the defendant's forum-related contacts;
and (3) the exercise of personal jurisdiction is fair and reasonable." McFadin v. Gerber, 587
F.3d 753, 759 (5th Cir. 2009).

Pase 4 of L0

First, Angel did not purposely direct its activities at Texas or purposefully avail itself of
the privileges of conducting activities here. It has not directed its goods or services to Texas at

all. Angel's

one relevant contact

with Texas (contracting for Smith to service Oklahoma wells)

is directed exclusively at Oklahoma. The contract requires one thing: for Smith to service wells

in Oklahoma.
Martinez's position is similar to the plaintiff s in Freudensprung v. Offshore Technical
Services, Inc., 379 F.3d 327, 344 (sth Cir. 2004), where the plaintiff was injured on a barge

off

the Nigerian coast. In Texas (the arbitration forum contractually selected by the parties) he sued

WWAI, the Panamanian owner of the barge. The plaintiff worked

as an independent consultant

for OTSI, a Texas company, which in turn had an agreement to staff WWAI's barge. WWAI
argued that Texas courts had no personal jurisdiction over

it

due to insuffrcient contacts with

Texas.

The court held that "the fact that WWAI contracted with Texas-based OTSI, initiated and
contemplated a long-term business relationship with OTSI, communicated with OTSI concerning

the development and execution of the contract, and wired money to OTSI in Texas do not
indicate that WWAI intended to avail itself of the privilege of doing business in Texas. The

significance of these alleged minimum contacts is severely diminished by the fact that the
contract at issue specified that . . . the material portions of the contract . . . were to be performed

in West Africa, not Texas." Id. at 345 (internal citations omitted); see also McFadin,587 F.3d at
759-60 (finding no personal jurisdiction in Texas even though Colorado saleswoman's contact

information appeared

on website, she had contract with Texas

manufacturer, and her

representative sold goods in Texas, because contract centered around saleswoman's operations

Page 5

of

10

outside Texas); Holt Oil

&

Gas Corp. v. Harvey,801 F.2d 773,778 (5th Cir. 1986) (holding

specific jurisdiction inappropriate where defendant communicated extensively with, sent
payments to, and contracted with Texas counterparty for drilling contract to be performed in

Oklahoma); Stuart v. Spademan,772 F.2d 1185, 1194 (5th

Cir. 1985) (finding insufficient

contacts where defendant negotiated and closed contract in Texas, shipped goods to Texas, and
sent payments to Texas).

Similarly, the fact that Angel contracted with Texas-based Smith, initiated
contemplated

a

long-term business relationship

with Smith,

communicated

with

and

Smith

concerning the development and execution of the contract, and sent money to Smith in Texas do

not indicate that Angel intended to avail itself of the privilege of doing business here. On the
contrary, everything Angel asked of Smith was to be done in Oklahoma, not Texas.
Second, Martinez's cause of action does not arise out of or result from Angel's Texas-

related contacts. This is a tort action, and Angel's alleged negligence occurred at a well in
Oklahoma, not Texas. Martinez's tenuous argument is that (1) Angel contracted with Smith, a
Texas company, to service its wells; (2) Smith hired Martinez, a Texas resident; (3) Maninez,
pursuant to the Angel-Smith contract, went to Oklahoma and got his thumb cut off at Angel's

well; (4) therefore, Angel's Texas relationship with Smith led to a Texas resident being injured
as

Angel's business invitee.
This argument is also similar to the plaintiff s in Freudensprung. There, the court noted

that "Freudensprung is not

a party to the contract between OTSI and WWAI . . . which

Freudensprung cites as evidence

of WWAI's minimum contacts with the forum state. The

[contract] provides that WWAI agrees to purchase professional services from OTSI for the
Page 6

of

10

performance of WWAI's projects in West Africa, that all personnel supplied by OTSI remained
employees

of OTSI while assigned to WWAI, and that WWAI was absolved of the ordinary

liabilities flowing to an employer. Thus, strictly speaking, the instant litigation does not 'arise
out of or relate to' WWAI's contacts with Texas." Id. at 344 (citing Coats v. Penrod Drilling
Corp., 5 F.3d 877 , 884 (5th Cir. 1993)).

Likewise, Martinez is not a pafty to the contract between Smith and Angel, which
Martinez cites as evidence of Angel's minimum contacts with Texas. Angel contracted with
Smith Contract Pumping, not Martinez, for Oklahoma services. Angel agreed to pay Smith to
service wells in Oklahoma, but there is no evidence that Martinez somehow became an Angel

employee. Thus, the instant litigation does not arise out of or relate to Angel's contacts with
Texas.
Because the first two factors are not

mel the Court

need not address the

third-whether

exercising jurisdiction is fair and reasonable-which is only considered "[o]nce

decided that
State . . .

."

a

it

has been

defendant purposefully established minimum contacts within the forum

Burger King Corp. v. Rudzewicz,4Tl U.S. 462,476 (1985). Even acknowledging

that the third factor can "sometimes serye to establish reasonableness of jurisdiction upon

a

lesser showing of minimum contacts than would otherwise be required," id. at 477, the first two
factors are too weak to be saved by the third. Consequently, Plaintiff has failed to make aprima

facie showing ofjurisdiction over Angel.
VENUE
This case is governed by the general venue statute, which states in relevant part:

(b) Venue in General-A civil action may be brought in-(l) a judicial district in which
any defendant resides, if all defendants are residents of the State in which the district is
Pase 7 of 10

located; [or] (2) a judicial district in which a substantial part of the events or omissions
giving rise to the claim occurred . . .
(c) Residency-For all venue pu{poses . . .@ an entity with the capacity to sue and be
sued in its common name under applicable law, whether or not incorporated, shall be
deemed to reside, d a defendant, in any judicial district in which such defendant is

subject to the court's personal jurisdiction with respect
question....

to the civil action in

28 U.S.C. $ 1391 (emphasis added). Venue here is improper under $ 1391(b)(2),

as

Martinez's injury and Defendants' alleged negligence occurred in Oklahoma, and Angel did not
require Smith or Martinez to do anything in Texas.

Under $ 1391(b)(1), NGS and Angel argue that the Northern District of Texas is an
improper venue because they have insufficient contacts to establish personal jurisdiction here,

making them non-residents. Martinez contends that because NGS has waived personal
jurisdiction by failing to argue jurisdiction before seeking dismissal or transfer for inappropriate
venue, NGS has also waived venue under $ 1391(bX2).
Some courts have held that bringing a I2(b)(3) venue motion without a l2(b)(2) personal

jurisdiction motion is not a waiver of venue as well

as

jurisdiction. DSMC, Inc. v. Convera

Corp.,273 F. Supp. 2d 14, 19 (D.D.C. 2002) ("this Court does not have venue simply by vinue

of this waiver and must make a separate inquiry into whether personal jurisdiction exists.");
Wine Markets Intern., Inc. v. Bass,939 F. Supp. 178, 180 (E.D.N.Y. 1996) ("the Court should
assess flurisdiction] as

it existed when the complaint was filed,

irrespective

of

subsequent

consent or waiver."). But see Knapper v. Safety Kleen Sys., Inc., No. CIV-A-908-CV-84-TH,
defendants have submitted to the jurisdiction

of

this Court. With their submission, the improper venue analysis ends."); KMR Capital, L.L.C.

v.

2009 WL 909479 (E.D. Tex. Apr. 3, 2009)

("All

Page 8

of

10

Bronco Energ,, Fund,1nc., No. CIV-LSA-06CA-189OG, 2006 WL 4007922 (W.D. Tex. July 11,
2006) (citing cases holding that failing to object to jurisdiction establishes venue).

Assuming arguendo that this Court has venue over NGS by waiver, however, this entire
case should be transferred to the Western District of Oklahoma because the Court does not have

jurisdiction over Angel and both defendants reside there. Section 1406(a), under which both
defendants seek transfer

if not dismissal, states that "[t]he district court of a district in which is

filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest
of justice, transfer such case to any district or division in which
Because Angel is not a resident

it

could have been brought."

of Texas for jurisdiction purposes, this Court does not sit in "a

judicial district in which any defendant resides, fbecause not] all defendants are residents of the
State in which the district is located." 28 U.S.C. $ 1391.

Venue is therefore inappropriate here and the Court has power to transfer the entire case,

in which all claims will require similar proof, to a court where the case could have been properly

filed.

See, e.g., Bradley v.

Nat'l Convention Services, ZIC, No. CIV. 06-1624(PJS/RLE),2006

WL 2361847 (D. Minn. Aug. 15, 2006) ("rather than dismiss two of the five defendants and risk
creating piecemeal litigation, the Court
Southern District

will invoke $

1406(a) and transfer this case

to

the

of New York."); Trex Co., L.L.C. v. Canton Lumber Co., No. CIV.A-

5:01CV00009, 2001

WL 543227 (W.D. Va. May 16, 2001) ("The court. . . has

personal

jurisdiction over Canton, but transfer as to Canton is in the interests of justice, based on want of

jurisdiction over Diversified."). There is no reason to encourage duplicative litigation by
transferring Angel but not NGS. Further, because another venue is clearly appropriate for the

Page 9

of

10

entire case, the Court
case

will

will not promote delay

and expense by dismissing Angel alone. The whole

be transferred to the Western District of Oklahoma.

CONCLUSION
Defendants' motions to transfer are GRANTED. This case is TRANSFERRED in its
entirety to the Western District of Oklahoma. The other pending motions will not be ruled on by

this Court.

It is SO ORDERED.

Signed this the

#

,i

day of April,2013.

MARY
ATES DISTRICT

Page 10

of10