Morris v. B C Olympiakos SFP

Filing 45

MEMORANDUM OPINION AND ORDER denying 34 MOTION to Strike the Declaration of Christos Stavropoulos, granting 18 MOTION to Vacate 10 Default Judgment.(Signed by Judge Sim Lake) Parties notified.(hcarr, )

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXA S HOU STON DIVISION

CHR ISTOP HE R MORRIS,

P laint iff ,

B .C . OLYMPIAKOS,

De fendan t .

5 5 5 5 5 $ 5 5 5

C IV IL ACTION NO . H-03-3489

M EMORA NDUM OPINION AND ORDER

Pen din g before the court

KAE Olympiakos SFP'S Motion to
and Plaintiff's

Vacate Default Judgment ( ocket Entry D
M otion
En try No .

Strike the Declaration of Christos Stavropoulos ( ocket D
H av in g considered the motions, responses and p rocedu ral

ad dition al briefing, the parties' submissions,

h istory of this case, and the applicable law , the court concludes,

fo r the reasons explained below , that the motion to vacate should be granted and the motion strike should be denied .

Pro cedura l Background Thi s action
Morris v. B C Olympiakos SFP Doc. 45

arises

from

an

agreement between plaintiff,

Christopher Morris ( orris), M
O lymp ia kos ,

fo rm er NBA basketball player, and M orr is p la y

G ree k national basketball club ,

b a sketb a ll in Greece .

Dockets.Justia.com

A ugu st

2003, Morris sued Olymp iako s

b re ach

con tract and fraud arising from Olympiakos' alleged failure to pay

Morris for his professional basketball servicesx
O n April 21, 2004, Olymp iako s was served with a summons and a
copy Plaint i ff's Original Complaint pursuant the Hague

conven tion .z On August Entry

of and Default Judgment ( ocket Entry No. 8) b ecau se Olympiakos had D
b een served with a summons and a copy of the complaint but had not

filed a responsive pleading

othe rw ise defended the

On September 1, 2004, the court entered an Order ( ocket Entry D

No.

granting Morris' request for entry of default judgment, and
which the court

Final Default Judgment ( ocket Entry No . D

adjudged that Morris nrecover from defendant

Olympiakos SFP,

the sum of $910,000 together with post-judgment interest thereon at
the rate On

2 .03 % per annum .' '
September

20 09 , Morris filed an Acknowledgment

Assignment

Judgment ( ocket Entry No. D

stating that 'l '
the

h ereby transfer and assign a11 title, rights and interest

within judgment to the following person : Gary

Eb e rt .

O ctobe r of 2009 Ebert filed Plaintiff's Application and Memorandum

lsee Plaintiff's Original Complaint, Docket Entry 2See Exhibit A attached to Plaintiff's Request for Entry Of and Default Judgment, Docket Entry No . 8.
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an Order

Issuance

Writ

Garnishment ( ocket Entry D

No. 13), which the court granted ( ocket Entry No . D
On November 2009, Olympiakos filed the pending motion to

vacate default judgment ( ocket Entry No. D

II . Motion to Strike

Pla in ti ff's assignee, Gary W . Ebert r moves dec la rat ion of Christos Stavropoulos on grounds

strike the that

inadm issab le hearsay, and

thus incompetent evidence to support

Olympiakos' Rule 60( ) b

motion.'? Ebert argues that '

S tavrop ou lo s has not met the required elements of Fed . R . Evid . 803 such that the records on which he states he re lied in making his declaration come w ith in any re cogn ized hearsay exception . Stavropoulos states c le ar ly that his declaration is p rem i sed solely nupon

E is) review of the books and records of Olympiakos.' h '
Sta vrop oulo s also testified during his recent deposition tha t none of the information contained in his declaration i s based on his own personal knowledge . Because the in form a tion and testimony contained in Stavropoulos' dec lara tion lacks the required foundation to qualify for

any hearsay exception, Plaintiff objects to the admission
o f the declaration and moves the Court to M r . Stavrop oulo s ' declaration in its entirety .4 strike

3pla inti ff 's Motion to Strike the Declaration of Christos Stav rop ou los , Docket Entry No . 34, 1.
l em orandum in Support of Plaintiff's Motion to Strike the M Dec la ra tion of Christos Stavropoulos, Docket Entry No . 35, p . 2 .

Olympiakos argues in response that Ebert's objections
Stavrop ou lo s declaration impact the weight the court is to give the

declaration but not its admissibilityx

A.

Applicable Law
Th e Stavropoulos declaration is not inadmissible hearsay if it

com e s within an exception to the Hearsay Rule .

Federal Rule of

Evidence 803 ( ) provides, in pertinent part, that: 6
The following are not excluded by the hearsay rule

( ) A memorandum , report, record , or data compilation, 6
in any form , of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from in fo rm at ion transmitted by, a person with know ledg e , if kept in the course of a regularly condu cte d business activity, and if it was the regu la r practice of that business activity to make th e memorandum , report, record, or data c omp ilat ion , all as shown by the testimony of the cu stod ian or other qualified witness, . . unless th e source of information or the method or c ircum stan ces of preparation indicate lack of t ru stw orth ine ss .

Rule 803 ( ) nrequires that either the custodian 6
bu sine ss records

the

Aothe r qualified witness'

found ation

b efore the records are admitted .' United States Commoditv Futures '

Tradinq Commission v. Dizona, 594 F. d 408, 415 ( th Cir. 2010) 3 5
( uoting United States v. Brown, 553 F.3d 768, q ( th Cir. 2008), 5

s ep ly Memorandum of Law of KAE Olymp iako s SFP in Further R Supp ort of Its Motion to Vacate Default Judgment and in Opposition to Motion to Strike Declaration, Docket Entry No . 39, p . 13.

cert. denied, admissib le under Rule 803 ( ) 6

( 009)). 2

Wh eth er

evidence matter of

nch ie fly

tru stw or th ine ss .' '

Mississippi River Grain Elevator, Inc . v .

Bartlett & Co., Grain, 659 F.2d 1314,

( th Cir. 1981). Since 5

record s maintained in the regular conduct of business are generally

trustwo rthy and because such evidence

often necessary, nthe favor

bu sine ss records exception has been construed generously

o f admissibility .' Conoco Inc . v . Department of Enerqv, 99 F .3d '

( ed . F

1997) .

' Tqhere N

no requirement that the

w itn ess who lays the foundation be the author of the record or be ab le to personally attest to accuracy .' ' Dizona , F.3d at

AA qualified witness is one who ' keep in g system

explain the record requirements

of Rule 803 ( ) are met.' 6 '
p er son al knowledge the

Id.

' E q e witness need not have 'T h
keeping p ract ice

record

circumstances under which the objected
United States v . Box, 309 (1995). F.3d 345,

records were kept.' '

( th Cir.), cert . denied, 5

gov ern s the uabsence of entry re cord s kept

a ccord an ce with the provisions of paragraph

(6)./ It provides: '
Ev iden ce that a matter is not included in the memorandum , rep o rt s , records, or data compilation s, in any form , kept

in accordance with the provisions of paragraph (6), to
p rov e the nonoccurrence or nonexistence of the matter, if the matter was of a kind of which a memorandum , report, rec ord , or data compilation was regularly made and

preserved , unless the sources of information or other cir cum st an ce s indicate lack of trustworthiness . Th is rule allows evidence of the nonoccurrence of matter that b a sed

would normally be recorded under Rule 803(6)
p rinc ip al that when

duty

re cord certain matters exi sts ,

n on-ex isten ce of a record is evidence for the converse p rop o sition , th at the matter about which there is no report did not occur .

on ly requirement

use

evidence to prove the nonorder

ex istenc e of an act i s the laying of a proper foundation . a proper fou nd ation

is not essential that the offering

w itn ess be the person who actually recorded the events . su fficien t that the with respect to the

w ay in which the records were made and the fact that they were reta ined
Jone s,

the regular course
F .2d

business .

United States v .

Cir .), cert. denied,

(1977).

Sin ce Rule 803(7) is based on Rule 80346), the testimony qualified witness required

of the custodian of the records

b efo re evidence may be received under Rule 803 ( ) 7

6 h e Advisory Comm ittee Note to % T leaves open the p oss ib ility that the absence of evidence from a record is not h ear say at a11 : nWhile probably not hearsay as defined in Rule 801, d eci sion s may be found which class the evidence not only as hearsay bu t also as not within any exception . In order to set the question at rest in favor of adm issib i lity , it is specifically treated
he re .' At least one court recently has noted the possibility that ' nev idenc e that a record does not exist arguably is not hearsay at a 1l .' United States v . Cervantes-Flores, 421 F .3d 825, 832 n . 4 '
-

( th Cir. 2005), cert. denied, 128 S. Ct. 244 ( 007). For present 9 2
pu rp ose s , the court assumes that such evidence is hearsay, but

( ontinued ...) c
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B.

Application o f the Law to the Facts Sta vrop oulo s state s in his declaration that he is nthe general

manager of KAE Olympiakos SFPZ ' and that he made nthis declaration R based upon ( isq review of the books and records of Olympiakos.'' h '
Ebe rt contends that the Stavropoulos declaration lacks an

app rop riat e foundation because during his deposition, Stavropoulos stated that he had no first hand knowledge of Olymp iako s ' relevant
act iv ities , that he does not know record s that he reviewed are comp lete the Olympiakos books and accurate , that he has

n ever been the custodian of Olympiakos' books and records, and that

there is currently no custodian of Olympiakos' books and recordsx
resp onse , Olympiakos has submitted second declaration

from Christos Stavropoulos stating that his first declaration was
ba sed on his uexhaustive and extensive multi-day search through O lymp iak os ' books and records, including general leger, and

6t...continued ) admissib le under Rule 8O3 ( ). 7
VDec larat ion of Christos Stavropoulos in Support of

Defendant's Motion to Vacate Judgment Under Rule 6O ( ) of the b Federal Rules of Civil Procedure ( tavropoulos Declaration), S
E xhib it A attached to Memorandum of Law of KAE Olympiakos SFP in Sup port of Its Motion to Vacate Default Judgment, Docket Entry N o . 19, 1 % 1.
8Id . at

g em o randum in Support of Plaintiff's Motion to Strike the M Declara tion of Christos Stavropoulos, Docket Entry No . 35, p . 6

( iting excerpts from the Deposition of Christos Stavropoulos, c Exh ib it B attached thereto) .

thousands upon thousands of docum en ts located in two wa rehou ses in
G reece ,zl and that 'o

g jt was Olympiakos' practice to store its business i
do cum ent s in these warehouses . The records in these wa rehou ses were prepared and maintained in the ordinary cour se of Olympiakos' business . I have no reason to b el iev e that any documents have been removed from the wa reh ou se .l1

Stav rop ou los has demonstrated through

second declaration

th at the records he reviewed were kept in the regular course Olymp ia ko s ' business . Although Ebert contends that Stavropoulos' second declaration inadmissible because an affidavit cannot be

used to contradict prior statements made statem e nts

deposition , the

Stavropou lo s' second declaration do not contradict deposition . Ebert does not cite , and the

the statements

c ourt has not found , any place in Stavropoulos' deposition where

coun sel asked

Stavropoulos answered questions regarding

know ledge of Olympiakos' record keeping practices . Stav rop ou los ' statement in his second declaration that the
rec ord s he reviewed Olympiakos' warehouses were p rep a red and

ma intain ed in the ordinary course of Olymp iako s' business satisfies

l De cla rat ion of Christos Stavropoulos in Further Support of D

Defendant's Motion to Vacate Judgment Under Rule 60( ) of the b
Fede ral Rules of Civil Procedure and in Opposition to Plaintiff's M ot ion to Strike the Declaration of Christos Stavropoulos ( tavropoulos Supplemental Declaration) attached to Reply S Mem orand um of Law of KAE Olympiakos SFP in Further Support of Its M otion to Vacate Default Judgment and in Opposition to Motion to Str ike Declaration, Docket Entry No . 39r p . 2 % 3 .
l ld . at t l l
.

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the requirements

Rule 803 ( ) that 6

witness 1ay a proper

found ation . Although Stavropoulos did not kn ow whether the records

were complete, the fact
in comp le te does not make

records might be inaccurate and/or
them untrustworthy and , thereforez

in adm is sib le .

See crompton-Richmond Co ., Inc . Factors v . Briqqs,

560 F.2d 1195, 1202

( th 5

1977) ( rguments based on a

ina ccu ra cy and incompleteness of business records go to weight not

to admissibility).

Once a foundation

laid,

the absence of

spe cific and credib le evidence app roach is

untrustworthiness, the proper fact finder

adm it the evidence and permit

determine
in dicate s that evidence can be excluded

Although Rule 803( ) 6
nthe source of

in form at ion or the method or circumstances of prep arat ion indicate la ck of trustworthinessr' the court concludes that Stavropoulos' '

de clarat ion should be considered .

See Rosenberq v . Collins,

624 F.2d 659 ( th Cir. 1980) ( ecords prepared before litigation is 5 r
fo reseeab le and su fficien tly trustworthy be relied on

company

conducting

daily

affairs
strike

are

admissible).

Ac cordin gly , plaintiff's motion
Ch risto s Stavrop ou lo s A lt erna tiv e ly ,
de clarat ion

de cla rat ion

be denied . court under concludes Rule 807 's
Stav rop oulos '

adm i ssib le

residual

hearsay

ex cep tio n . The residual hearsay exception permits the admission of

an out-of-court statement not covered by Rule 803

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the court determines that ( ) the statement is offered A evidence of a material fact; ( ) the statement is more B
p roba tive on the point for which it is offered than any othe r evidence which the proponent can procure through

reasonable efforts; and ( ) the general purposes of these C

rules and the interests of justice will best be served by
adm iss ion of the statement into evidence . Fed . Ev id . The residual exception applies only

statemen ts nnot specifically covered by Rule 803 .' Id . The Fifth '
Circu it interprets this phrase m e an that, sta temen t

adm issib le under one

th e hearsay exceptions, that exception

shou ld be relied on instead of the residual exception . See United
Sta tes v . Ismoila,

F . d 380, 392-93 3

1996), cert. ( 997) 1

d en ied sub nom Debowale v . United States,

( inding credit cardholder statements admissible under residual f
excep tion after determ in ing that statements were inadmissible as

business records); United States v. Hitsman, 6O4 F. d 2 1979) ( ollege transcript not admissible as business record c under Rule 803(6) because neither custodian nor qualified witness available to testify properly admitted under residual exception).

c ourt

c ou r se m ind fu l that merely fulfilling the

requ irem en ts

the hearsay exceptions outlined

either Rules

803 ( ) 6

803( ) does not establish 7

dispositive

conclusive

in stead , clearing these evidentiary hurdles only perm its
in trodu ction of ev iden ce certain testimony in evidence . th e issue In weighing

O lym p ia ko s' contacts with Texas,

Stavropoulos'

testimony

will

be

accorded of

little

weight .

Stavrop oulo s was

the custodian

Olympiakos' books and

record s , and at least prior to the time that this action was filed
wa s

inv olved

O lym p ia kos ' efforts adm it s that the books

recruit and

players.

M o reov er , Stavropoulos

records he

reviewed are not well organizedxz

C.

C onclu sion s Fo r the reasons explained above, p la int if f's motion to strike

th e declaration of Christos Stavropoulos will be denied .

11 1 . Motion to Vacate

citing Federal Rule of Civil Procedure 6O ( ) ( ), Olympiakos b4

asserts

entitled

relief from the default judgment

because the judgment is void.l Olympiakos argues that 3

E qhe judgment in this case is void because the Court did t not have personal jurisdiction over Olympiakos. As
exp la in ed fully in its memorandum in support of this m ot ion , Olympiakos had no contacts whatsoever with the State of Texas in connection with its dealings with

H Dep o sition of Christos Stavropoulos, Exhibit B attached to Memo randum in Support of Plaintiff's Motion to Strike the De clarat ion of Christos Stavropoulos, Docket Entry No . 35, pp . 810 , 13-15, and 23-25. 1 KA E Olympiakos SFP'S Motion 3 to Vacate Default Judgment

( otion to Vacate), Docket Entry No. 18, pp. 1-2 % 4. M

Morris, and the services contracted for were a11 to be

performed in Greecex l

A.

Standard of Review

A Rule 60( ) ( ) motion allows a party to receive relief from b4

a final judgment, order, or proceeding if the underlying judgment
v oid . The Fifth Circuit has recognized two circum sta nce s

which a judgment may be set aside under Rule 60 ( ) ( ): b4

the

lacked subject matter or personal jurisdiction; and
th e court acted
Ca rter v . Fenner,

a manner inconsistent with due p roce ss of law .
10 00 ,

Cir .), cert. denied,

( 998) . 1 60 ( ) ( ) b4 nembodies
a lw ay s

Th e Fifth Cir cuit has explained that Rule

p rin cip le

that

in

federal

court,

'de fend an t

p ro ceed ing s,

default

judgment, and

then

challenge

that

judgment

jurisdictional grounds.'' Jackson v. FIE Corpw 302 F.3d 515, '
( th 5

2002) ( uoting In sur ance Corp . of Ireland , Ltd . v . q
2099 ( 982 )). 1

Compagnie des Bauxites de Guinea,

generalr ' hether in personam jurisdiction can be exercised over w

defendant
Id . at F.3d

question of 1aw and subject

de novo review.r' '

( uoting Dickson Marine Inc. v. Panalpina, Incw q 335 ( th 5 1999)). This is so because nA ule R

60 ( ) ( ) motions leave no margin for consideration of the district b4

l4Id

court's discretion as the judgments themselves are by definition
either legal nullities or not.'' Id . ( uoting Carter, 136 F.3d at ' q
1005) .
Cit in g Jackson, 302 F .3d at 520-21, Ebert argues that 'th e law ' o f this case that Olympiakos bears burden of p rov in g that

Court lacks jurisdiction
Eb ert exp lain s that

enter

valid judgment against

Olympiakos, like E he Jackson defendant), knowingly t suffered a default judgment to be rendered against it. Like g he Jackson defendant), Olympiakos never challenged t the Court's jurisdiction by appealing the judgment of the
or ig ina l action . Accordingly , under the Fifth Circuit's

reasoning

in

E acksonl, l

the

Court

should

require

Olympiakos to prove that it was not properly subject to the Court's jurisdiction before vacating the judgment
pursuant to Rule 60( ) ( ). 6 b41
Eb ert 's argument

m i sp laced because the procedural posture

Jack son differed from the procedural posture here .

In Jackson, the defendant filed a Rule 60( ) ( ) motion b4
va cate . The district court r

E loting that the question who bears the burden of proof n

in a Rule 60 ( ) ( ) challenge to personal jurisdiction is b4
one that has not been answered for this circuit, . . . ad op ted the view of the Seventh Circuit that once a de fendan t with notice chooses to suffer a default

judgmentr he is the party who thereafter must shoulder

ls laint iff 's Sur-Rep ly to Olympiakos' Memorandum of Law in p Furthe r Support of Its Motion to Vacate Default Judgment, Docket E nt ry No . 43, p . 4 % 8 .

l6ld . See also Plaintiff's Memorandum in Opposition to De fend ant 's Motion to Vacate Judgment, Docket Entry No . 36, p . 3

( rguing that nOlympiakos carries the burden of proving that the a

court lacks personal jurisdiction over it') '

the

burden

p ro ving

the

absence

p e rsona l

jurisdiction.
Id . at 520-21. The defendant appealed the district court 's denial
of

Rule 60( ) ( ) motion to vacate, but did b4

challenge the
the

distr ict court's holding 'tha t the burden of proof shifts '

defaulting defendant and Rule 60 ( ) b

m ov ant .' '

Id . at 521

The Fifth Circuit explained that because the defendant Mhas not

cha llenged this ruling on appeal :

now

law of the case .

n ot yet, however, the 1aw of this circuit, as we do not reach the issue and need choose a side split of authority on

th is question, leaving th at for another day .' Id . Since the issue ' wh ich party bears the burden pr oo f on Olympiakos' Rule

60 ( )( ) motion b4
th is case, es tab li sh ed .

va cate has

p revi ous ly been considered be

ca se ' on this issue has yet '

The parties and the courts d iffer over who b ea rs the burden of

showing personal jurisdiction o r lack thereof

the context of a

Rule 60 ( )( ) motion. Normally, the plaintiff bears the burden of b4

demonstrating the court's ability to exercise jurisdiction over the
d efenda nt . See Luv N ' Care, Ltd . v . Insta-Mix , Inc ., 438 F .3d 465,

469 ( th 5

cert. denied,

S.

2968 ( 006) ( Where 2 u

defendant challenges personal jurisdiction, the party seeking
invo ke the power of the court bears the burden of proving that

jurisdiction exists.' . ')
que stion , and the case

However, Rule 60

silent on this

is unclear on which party bears the

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burden after a default judgment has been entered.

Th e Second and

Seventh Circuits have placed th e burden of proof on the defendant .

See Ballv Export Corp . v . Balicar, Ltd.,
1986)

F. d 398, 2

( th 7

the defendant, after receiving notice, chooses

case

a default judgmentz

defendant must then
contest

sh ou lde r the burden of proof when the defendant decides

jurisdiction

post judgment rule 60( )( ) motion.'); Burda b4 '
F.3d 292, 299 ( d 2 2005) ( We now n

Media, Inc. v . Viertel,

hold that

motion

vacate a default judgment based

imp rope r service of process where the defaulting defendant
actua l notice

the original proceeding but delayed

b ringing

th e motion, th e defendant bears the burden of proof to establish

that the purported service did not occur.'). As th e Second Circuit /
exp lain ed ,
p la cing the burden On the defendant reflects nthe con cern s of comity among the district courts of the Un ited States, the interest in resolving disputes in a

single judicial proceeding, the interest of the plaintiff in the choice of forum, and the fear of prejudice against
a plaintiff who, owing to delay, might in subsequent co llate ral proceedings no longer have evidence of

personal jurisdiction that existed at the time of the
un de rlying suit .' '

Burda, 417 F.3d at 299 ( uoting Miller v. Jones, q

F. Supp.

210-11

Conn . 1991)).

Although the Fifth Circuit has

ru le on this issue, at least one district court in this circuit has he ld that the burden remains with the plaintiff .

Rockwell International Corr . v . KND CorD ., 83 F.R .D . 556

( . . Tex. 1979), the court entered a default judgment in favor ND
p la int iff , and the defendants filed motions for relief from

judgment pursuant

Rule 60 ( ) b

claiming that

judgments

ente red against them were void b ecau se the court lacked personal

jurisdiction. The plaintiff argued that the burden of establishing the earlier judgment issued without personal jurisdiction must
fa ll on the defendants, and that such a showing could be fulfilled

on ly through the presentation of strong and convincing evidence .

Observing that ' g jhis assignment of the burden, 't

cor rec t , would

rev erse the normal placement when a party challenges the existence
of

personam jurisdiction through a Rule 12 motion to dismissz'
the court rejected the plaintiff's argument.

id .

C iting McNutt v . General Motors Acceptance Corp . of Indiana, Inc w

56 S. Ct. 78O ( 936), the court concluded that 1
wh o must shoulder the task of showing facts

the plaintiff
that permit an

affirmative jurisdictional finding
shifted .' Id . ' M cN utt , 56 S . statuto ry amount

burden that may not be

780, involved con trove rsy required

challenge

the

the exercise of

diversity jurisdiction, but the reasoning underlying the Court's
decision applicable the exercise of personal jurisdiction
There the Supreme Court explained

b eing challenged th e plaintiff

th is case .

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must allege in his pleading the facts essential to show

jurisdiction .

If he fails to make the necessary

a llega tion s he has no standing . If he does make them , an

inquiry into the existence of jurisdiction is obviously
fo r the purpose of determining whether the facts support h is allegations . In the nature of things, the authorized inq ui ry is primarily directed to the one who claim s that the power of the court should be exerted in his behalf.

As he is seeking relief subject to this supervision, it
fo llow s that he must carry throughout the litigation the b u rd en of showing that he is properly in the court . The auth or ity which the statute vests in the court to enforce

the limitations of its jurisdiction precludes the idea that jurisdiction may be maintained by mere averment or that the party asserting jurisdiction may be relieved of
h is burden by any formal procedure . If his allegations of

jurisdictional facts are challenged by his adversary in
an y appropriate manner, he must support them by competent p ro of . And where they are not so challenged the court

may still insist that the jurisdictional facts be
e stab lish ed or the case be dismissed, and for that p urp ose the court may demand that the party alleging

jurisdiction justify his allegations by a preponderance
o f the evidence . H ere , the allegation in the bill of complaint as to

jurisdictional amount was traversed by the answer. The
cour t made no adequate finding upon that issue of fact, an d the record contains no evidence to support the a llega tion of the bill . There was thus no showing that

the District court had jurisdiction and the bill should
h ave been dismissed upon that ground .
56 S . Plaint iff 's Original Complaint alleged that u l qhis Court has t

personal jurisdiction over O lym p iako s because r among other things,
O lymp ia kos does business in Texas and because the facts giving rise

to the Complaint, including the formation of the contract at issue,
oc cu rred in Texas.'l Plaintiff also alleged : /V

U p la int iff 's Original C omp la int , Docket Entry No .

Olympiakos is a basketball team that competes on e of the Greek leagues .

In 1999, through M orri s' agent , Olympiakos c ontac ted and solicited Morris in Texas about p lay in g for the team in the Greek league . 8. Olympiakos, through Morris' agent, made rep re senta tion s to Morris while he was in Texas ab ou t playing basketball in Greece . O lymp ia ko s forwarded a draft written basketball ag re em en t to Morris while he was in Texas .

10 . A

written

agreement

( Agreement') n '

between

Olymp ia kos and Morris was subsequently executed on A ugu st 31, 1999. A true and accurate copy of the Ag reem en t is attached hereto as Exhibit 'A ' . ''

Pu rsu an t to the Agreement, Olymp iako s agreed to pay M o rris for p la ying basketball for it in the Greek league .
12 . Based upon Olymp ia kos ' statements and rep resen tat ion s, Morris expended significant time and money, and did not pursue other basketball opp ort unit ies , in order to travel to Greece to play b aske tb a ll . Und er the Agreement, Olymp iakos also was required t o provide Morris with qualified medical assistance

for any injuries suffered playing basketball.
O lym p iako s breached that p rov is ion of the Agreement b y not providing such qualified help after Morris

suffered an injury.
O lymp ia kos further b re ached th at Agreement by uni late rally and unlaw fu lly te rm in at ing that A g reemen t without good cause .
Olymp ia kos has refused to pay Mo rr is the monies he is owed under this Agreement, an d has also refused to address the aggravation of Morris' injury which

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was caused by the failure

p rov ide qualified

medical assistance x ' Because Rule 60 ( )( ) nembodies the principle that b4 federal

' efendant d
proceedings, risk judgment

always free

ignore

judicial

default judgment, and then challenge that F .3d
at 2106), and
allegations

jurisdictional grounds,r' Jackson, '

( uoting Insurance Coro . of Ireland, q
b ecau se Olympiakos has challenged p la int iff 's

jurisdictional facts
60 ( ) b

an appropriate manner by filing its Rule

motion, the plaintiff must now support his allegations

jurisdictional facts with evidence.
conc lu de s that the plaintiff

Accordingly, the
this case the plaintiff's

assignee, Ebert) not the defendant bears the burden of proof on the

B.

Applicable Law

Plaintiff's Original Complaint ( ocket Entry No. D

alleges

sta te 1aw claims for breach of contract and fraud r and alleges that
cou rt has pursuant

5 1332 as there is complete diversity of citizenship and the amount

in controversy exceeds $75,000.
fed eral courts ' Asit tin g '

c la im s arising under state law

diversity

assert

E ersonalq p

jurisdiction

state's long-arm statute applies, as

l Id . at 2-3 %% 6-16. 8
-

1 9-

interpreted

stat e 's courts; and

due process

satisfied under the E lourteenth g q endment to the United States F Am
Con stitu tion .'' Joh nst on v . Multidata Svstems International Corp w '

F.3d 602, 6O9 ( th 5
Diob v , Inc ., 889 F .2d 612,

2008) ( uoting Cvcles, Ltd. v. W . . q J
l989)). Texas long-

arm statute authorizes service of process on nonresidents uE ln an i
a ct ion arising from n on re sident 's business th is state .' '

Tex . Civ . Prac . & Rem . Code 5 17 .043 . The Texas Supreme Court has
stated that long-arm statute's broad doing-business language

allows the statute to 'reach as far as the federal constitutional

requirem ent s

du e

process

will

allow .f' '

Moki

Mac

River

Expeditions v . Druqq, 221 S. .3d 569, 575 ( ex . 2007) ( uoting W T q
Guard ian Roval Exchanqe A ssu ranc e , Ltd . v . Enqlish China Clavs,

P . . ., LC

S. . d 223, W2

( ex . 1991)). T

Exercise of personal

jurisdiction over a nonresident defendant comports with federal due
p roce ss guarantees when the nonresident defendant has established m inim um contacts the forum state , and
exe rci se

jurisdiction ndoes not offend A raditional notions of fair play and t

substantial justice.'' International '

Shoe

Co. v. State of
-

W ashingt on , Office of Unemplovment Compensation and Placement,

66 S .
339, 343 ( 1940)).

( 5) ( uoting Milliken v . Mever, 194 q
Once plaintiff satisfies these two

requ irem en ts a presumption arises that jurisdiction is reasonable,
th e burden of proof and persuasion shifts defendant

opposing jurisdiction

npresent a compelling case that the

presence of some other considerations would render jurisdiction
unrea sonab le .' ' Burqer Kin? Coro . v . Rud zew ic z , 2174,

2185 ( 985). 1

C.

Undisputed Facts
C it in g the declaration
Ge ne ral Manager, Christos

Stavropoulosr Olympiakos argues that the default judgment is void

personal jurisdiction because Olympiakos had no
contact s with the State of Texas in connection with Morris . Ebert
h as

subm itted

any ev id ence that contradicts the relevant

a spe ct s of Stavropoulos' declaration regarding Olymp iako s' general
bu sin es s practices, th at Olympiakos O ne co rp ora te entity G ree ce 's national

fo rmed under Greek law , that Olymp iako s
b a sketb a ll club s with

p r in cip a l place

b u sine ss

P iraeu s,

Greece , that Olympiakos does not maintain a presence in Texas, and

th at on June 24, 2009, Olympiakos was acquired by new owners . Nor
h as Ebert submitted any evidence that contradicts relevant

asp ect s of Stavropoulos' declaration regarding Olympiakos' contacts
w ith Morris, i .e ., that the contract at issue was entered by the p artie s on August neg otiat ed through

1999 ,
M orri s'

G reece , that

contract was

age nts ,

Tom

M cLau gh lin
and

and

Andy

B ou togia nni s

Boston,

Ma ssachu set ts , M c Laugh lin 's

Anastassios

De lib alt ad ak is , an associate

Gre ece , and that

the

contract

was

serv ice s

pe rfo rm ed

G reece .19

Stavrop ou lo s' statements concerning Olympiakos' general b us ine ss p ractice s and contacts with Morris are corroborated by Olympiakos' w ritten contract with Morris which attached Plaintiff's

Original Complaintrz and/or Olympiakos' written contract with o
M orris ' agent, Tom McLaughlin , which de clarat ion .zl attached Stavropoulos'

lg em orandum of Law of KAE Olympiakos SFP in Support of Its M M otion to Vacate Default Judgment, Docket Entry No . 19, pp . 3-5

( iting c

Exhibit A

attached

thereto, Declaration

of Christos

Stavropo ulo s in Support of Defendant's Motion to vacate Judgment

under Rule 6O ( ) of the Federal b ( tavropoulos Declarationl) S

Rules

of

Civil

Procedure

M con tract , attached to Plaintiff's Original Complaint, Docket

Entry No. 1 ( pening lines show that the contract was executed in o
Piraeu s , Greece, on August 1, 1999, by Morris and Olympiakos SFP, a Basketball Company located in Piraeus, Greece ; A rt ic le 15 shows th at Morris designated Tassios Delibaltadakis, a resident of

Athens, Greece, as his nattorney in fact'). '
z A gre em ent , attached to Stavropoulos' Declaration attached to l M em orand um of Law of KAE Olympiakos SFP in Support of Its Motion to

Vacate Default, Docket Entry No . 19 ( howing that Olympiakos agreed s
to negotiate an agreement for Morris to play basketball in Greece th rou gh McLaughlin and Boutogiannis whose company, Best in Sports,

had an account at the Bank of Boston). See also Affidavit of Tom
M cLaugh lin attached to Reply Memorandum of Law of KAE Olymp ia ko s SFP in Further Support of Its Motion to Vacate Default Judgment and in Opposition to Motion to Strike Declaration, Docket Entry No . 39,

at %% 2-3 stating that he has at a11 times been a resident of
Bo ston , Massachusettsr and that his company , Best in Sports, has

been located in Andover, Massachusetts since 1995).
-

2 2-

D.

Analy sis
Eb ert argues that

a1 l of the credible evidence establishes that Olymp ia ko s d id have the necessary requisite contacts with Texas . No t only did Olympiakos solicit Christopher Morris . ., a Texas resident , for emp lo ym en t , but Olympiakos also so licit ed other Texas residents for employment during the

same relevant time period. Under Section 17 .042 ( ), such 3
sol icitat ion s of Texas residents for employment, whether accomp l ish ed inside or outside the state, are acts that con stitute udoing business,' suf ficient to confer '

personal jurisdiction over the soliciting person or
ent it y .2 2 In support of his argument th at Olympiakos' business contacts with
Texa s were sufficient

th e

court

exercise

personal

jurisdiction, Ebert submits Morris' declaration and the declaration
of Shawn Respert , another former basketball player .

In his declaration Morris states : I am a resident and citizen of Texas . I have been a resident of Texas continuously since 1988 . I h ave had a Texas driver's license since 1988 .
P rior to signing the contract w ith Olympiakos, I had at least one telephone conv er sat ion with O lymp iako s' general manager a t the time, Takis L iv era tos , in July of 1999 . Du ring that telephone conversation , L iv e rato s urged m e to come play for Olympiakos . 6. P rior to that telephone conversation , was und ecid ed about whether I would go play for O lymp i akos , but Liveratos convinced me during that te lep h one call .

H pla in tif f's Memorandum in Oppo sit io n to Defendant 's Motion to Vacate Judgment, Docket Entry N o . 36, p . 2 % 4 .
-

23-

During that telephone call, I told Liveratos that h e had made up my mind and that I would come play for Olymp iakos .

Live ra tos expressed delight . He re que sted that I p rov id e h im my address so that Olymp iako s could send m e something . W i th in a day or two, a Federal Exp res s package ar riv ed at my Texas residence, from Olympiakos . That package contained a travel itinerary and airl in e tickets for me to f1y to Italy to play for O lymp ia ko s . 1O . Prior to signing the Olymp iako s contract on A ugu st 31, 1999, I flew from Texas to Italy, using th e airline tickets sent directly to me from O lymp ia ko s .

11 .

arrived in Italy on August 10, 1999, and p a rtic ip ated in a two-week long training camp with O lymp ia kos prior to signing the Olympiakos
con tra ct .

Had it not been for the August 1999 telephone call from Liveratos, I may not have signed the contract to play for O1ympiakos.2 3
In his declaration Respert states :

1.

retired professional basketball p laye r . Dur in g the 1999-2000 basketball season , I played p ro fe s siona l basketball for B .C . Olympiakos SFP'S

( olympiakos') basketball team in Greece . u '
Prio r to the 1999-2000 basketball season, I was a res id ent of Texas, with a home in Houston , Texas .
4. Du ring 1999, my agent was Carl Poston, of the firm o f Poston & Poston . Carl Poston's office was in
H ou sto n , Te xa s .

M De clara tion of Christopher Morris , Exhib it F attached Pla int if f's Memorandum in Opposition to Defendant's Motion

Vacate Judgment, Docket Entry No. 36, %% 3-12 ( mphasis added). e
-

2 4-

During the summer of 1999, O lym p ia kos began recru it in g me to play basketball thr ou gh my agent in Houston , Texas .
A s a result of Olymp ia kos ' recruitment of me , th roug h Carl Poston in Houston, Texas, I agreed to p lay professional basketball for Olymp ia ko s .

Fo llow ing Olympiakos' negotiations with Carl Po ston , Olympiakos forwarded a player contract to Ca rl Poston for me to sign . A fter consulting with Ca rl Poston , I signed the Olympiakos p la ye r
con tra ct .

Du ring the entire time that Olympiakos recruited me to play basketball for it during the summer of 1999 , b0th Carl Poston and I were residents of the Stat e of Texas .z d

Texa s Lon? Arm Statute

Citing 5 17.042( ) 3

the Texas Civil Practice and Remedies

Code, plaintiff contends that Olympiakos

subject

personal

jurisdiction because Olympiakos was doing business in Texas when
d irect ly recruited him residen t at the time . for emp loym en t because was a Texas

Section 17 .042 of the Texas Civil Practice

and Remedies Code provides that

g qn addition i other acts that may constitute doing b u sine ss , a nonresident does bu s in es s in this state if the nonresident

M De cla rat ion of Shawn Respert , Exhibit G attached to Plain tiff 's Memorandum in Opposition to Defendant's Motion to V acate Judgment, Docket Entry No . 36, %% 1-8 .

( ) recruits Texas residents, directly or through an 3
int erm ed iar y located in this state , for employment inside or outside this state . Ebe rt contends that Morris was directly recruited by Olymp iakos p lay basketball in Greece because Morris had

at least one

July

1 999 telephone

conversation

with

Olympiakos' general

manager

(t a

that

time),

Takis

L ive ratos . During this telephone conversation, Liveratos u rged Morris to come play basketball for Olymp iako s . Prior to the telephone conversation with Liveratos, Mo rri s was undecided about whether he would go play for

Olymp iakos, but Liveratos convinced Morris to join
O lymp iakos during conv er sation .z s the course of that telephone

Eb ert also contends that while

Tex as Morris received from
Italy which

O lymp ia kos a travel itinerary and airline tickets
Mo rris used p art icip at e

two -w e ek training camp with

Olympiakos prior

signing the Olympiakos contractx f

Th e evidence that p la int iff contends establishes Olympiakos

recru ited him to play basketball

Greece does not satisfy the

requirements
Remed ies Code

17.042 ( ) of the Texas Civil Practice and 3
d oing business in Texas . M o rri s states that he does state that

sp oke with Liveratos on the telephone eithe r he Liveratos were

Texas when they spoke on

teleph one . Ca se

Ebert has

cited and the court has

found any

wh ich

sin gle telephone conversation between a foreign

M pla inti ff 's Memorandum in Opposition to Defendant's Motion to Vacate Judgment, Docket Entry No . 36, 10 % 23.

26 d . at I

% 24 .
-

2 6-

employer and

Texas resident has been held to constitute doing recruiting a Texas resident for purposes

bu sine ss in Texas

17.042 4 ) of the Texas Civil Practices and Remedies Code. 3
M o rris states that after he told Liveratos he would play for Olymp ia ko s, Liveratos asked Morris address so that

Olymp iako s could send him something , and that within a day or two , p ackag e arrived Morris' Texas residence containing a travel

it in era ry and airline tickets

Europe . Although Morris does not
Texas address, Morris does

state that he provided Olympiakos
state that he uflew

Italy using the airline tickets sent

d ire ctly

me from Olympiakos .'z '?

Inferring from this statement

that Olympiakos sent d ire ctly O lymp ia kos ' Morris act of

travel itinerary and airline tickets Texas, the court cannot sending these items conclude that Texas

M orr is

constitutes recruiting a Texas resident for purposes of 5 17.042 ( ) 3
of the Texas Civil Practice and Remedies Code . Morris' statement
L ivera tos asked him for his address so that Olympiakos could

send him something shows that Olympiakos did not know where Morris lived , that Olympiakos was prepared to send the travel itinerary
and airline tickets whatever address Morris provided, and ,

the refore , that Olymp iako s did not purposely

knowingly recruit

a Texas resident . Ebert has not cited and the court has not found z De clara tion of Christopher Morris, Exhib it F attached to 7 Plaint iff 's Memorandum in Opposition to Defendant's Motion to

Vacate Judgment, Docket Entry No. 36, % 10 ( mphasis added). e

any case in which sending a package
Texa s resident has been held

Texas at the direction of a
constitute doing business

recruiting

Texas resident under 5 17.042 ( ) of the Texas Civil 3

Practices and Remedies Codex' Thus, the court concludes that Ebert
h as failed to carry his burden of establishing that Olympiakos' contact s with Morris constitute doing business or recruiting a
Texas resident under R em edie s Code .

17 . 42 ( ) 0 3

the Texas Civil Practice

Due Process Requirements of the Fourteenth Amendment

Exercise of personal jurisdiction over a nonresident defendant
comp ort s with federal due process guarantees when the nonresident de fen dan t has established minimum contacts with the forum state,

and the exercise of jurisdiction ndoes not offend l raditional t

notions of fair play and substantial justice.r' International Shoe '
Co ., 66 S. Ct. at 158 ( uoting Milliken, 61 S. Ct. at 343) q

( ) Minimum Contacts a
In deciding whether sufficient minimum contacts exist

exercise personal jurisdiction the court

directed to determine

whe th er 'th e defendant's conduct and connection with the forum '

z plain tif f's Original Comp laint alleges that 'O lymp iako s 8 ' fo rw arded a draft written basketball agreement to Morris while he

was in Texasz ' Docket Entry No. 1, p. 2 % 9, but no evidence has
been submitted in support of this allegation .
-

2 8-

state are such that he should reasonably anticipate being haled into court there.' ' 55 9, Worldwide Volkswaqen Corp . v . Woodson,

(1980). ' l qt is essential 'l

each case that

there be some act by which the defendant purposefully avails itself o f the privilege forum State,

thus invoking the benefits and protections of its laws .' Hanson v . '

Denck1a,78 66

1228, at 159). uThis

( 958) ( iting International Shoe, 1 c ' urposeful availment' requirement p

en sure s that a defendant will not be haled into solely as
contact s r

jurisdiction
'at tenua ted '

result of
o f the

'random ,'

Afortuitousr'

th ird person ./' '

Burcer Kinq , 105 S .

at 2183 .

Moreover,

' jlurisdiction is proper U
re su lt from actions by the

where
defendant

contacts proximately
himself that create a

'sub stant ial connection' with the forum state .' '

Id . at 2183-84.

g lhere the defendant ndeliberately' has engaged in W '
sign ifi can t activities within a State . or has crea ted ucontinuous obligations' between himself and ' res id ent s of the forum . . . he manifestly has availed h im se l f of the privilege of conducting business there, and because his activities are shielded by nthe benefits and protections' of the forum 's laws it is presumptively ' n ot unreasonable to require him to submit to the burdens of litigation in that forum as well .

Id . at 2184.

nThere are two types

A inimum contacts': m

those

that give rise

specific personal jurisdiction and those that

give rise to general personal jurisdiction .' Lewis v . Fresne, '
F .3d 352, ( th Cir. 2001). 5 Olympiakos contends that

contacts

Texas are insufficient

support this court's

exercise of personal jurisdiction on the basis of either general specific jurisdiction. g z

(1) General Jurisdiction

A court may exercise general jurisdiction over a non-resident
when the non-resident's ncontacts with the forum state F .3d at

substan tia l , continuous, and systematic .' '

Johnston,

( iting Helicopteros Nacionales de Colombia, S. . v . Hall, c A

104

1868, 1872-74 ( 984)). nThe ' ontinuous and systematic 1 c
a difficult one meet , requiring extensive

contact s test
contac ts between

defendant

a

forum .'' '

Id .

( uoting q

Subm er sib le Svstems, Inc . v . Perforadora Central, S .A . de C . ., V

249 F. d 413, 419 ( th Cir.), cert. denied, 122 S. Ct. 646 ( 001)) 3 5 2 ' Ag lven repeated contacts with forum residents by 'E foreign

d efendan t may not constitute the requisite sub stant ia l , continuous, an d systematic contacts required find ing gen eral

jurisdiction.

Id. ( uoting Revell v. Lidov, q

F.3d 467,

( th Cir. 2002)). 5
ev aluat in g contacts of

nGeneral jurisdiction can be assessed by
the defendant with the forum over

re asonab le number

years, up to the date the suit was filed .' '

A ccess Telecom , Inc . v . MCI Telecommunications Corr ., 197 F .3d 694, M Mem orand um of Law of KAE Olympiakos SFP in Support of Its M ot io n to Vacate Default Judgment , Docket Entry No . 19, pp . 9-13

( pecific jurisdiction) & p. 13 n . 5 ( eneral jurisdiction). s g

( th Cir. 1999), cert. denied, 121 5 ( 000). 2

Ct. at 275 and 292 the

uThe determination of what period is reasonable

contex t of each case should be left to the court's discretion .' ' M etropo litan Life Insurance Co . v . Robertson-ceco Corp w 84 F .3d

Cir .), cert. denied,

( 996). 1

general jurisdiction purposes, the court does not view each contact
isolat ion but, instead , views a11 the defendant 's contacts in

See Access Telecom,
a

at 717 ( hen determining whether w
the forum state are

nonresident defendant's contacts with

sufficient

establish general personal jurisdiction, contacts
toto' instead ' in isolation). n E qague and v
indication as to the

must be examined

overgen era lized assertions that give

extent , duration,

frequency of contacts are insufficient to

support general jurisdiction.' '

See Johnston,

F.3d

( iting Gardemal v. Westin Hotel Co., 186 F.3d 588, 596 ( th Cir. c 5 1999)).

The seminal general jurisdiction case
Consolidated Minin? Co., (1952),

Perkins v. Benquet
which the Supreme

C ou rt first articulated the idea that a court may exercise personal

jurisdiction over

foreign corporation based on general business
Supreme Court upheld the

op eration s within the forum state .

district court's exercise of general personal jurisdiction in Ohio
ove r Philippine corporation whose president and general manager

re lo cated to Ohio during the Jap an ese occupation of the Philippine

-

31-

Islands .

While

Ohio,

president maintained

corporate

o ffice where he kept the record s

the corporation, conducted

d irec tor 's meetings, and made a11 key business decisions . corpo ration also distributed salary checks drawn on two Ohio bank accoun ts and engaged an Ohio bank to act as a transfer agent.

light of these activities, the Court held that Ohio could exercise

jurisdiction over the corporation because the president had
ucarried on in Ohio a continuous and systematic supervision of the n ecessa rily limited wartime activities of the company .' ' Id .

a t 419.
By contrast,

H elicop tero s the Sup rem e Court held that the

de fen dant 's general business contacts with Texas were insufficient

support an exercise of general jurisdiction despite the fact
that defendant had p urcha sed equipment from a company the

fo rum state .

104 S .

a t 1873-74 .

Over a six-year period the

defendant purchased helicopters ( pproximately 80% of its fleet), a
spare parts, and accessories for more than million from a Texas

compan y ; sent its p ro sp ec tiv e pilots to Texas for training; sent m anagem ent and maintenance personnel Texas for technical

consu ltat io ns ; and received a check for over

million that was

drawn upon a Texas bank. Nevertheless, the Court held that none of
the contacts were substantial enough standing alone taken

together

support the assertion of general jurisdiction. The

Court explained that the mere purchase of goods from a state , even

-

3 2-

regular intervals and

sub stan tia l amounts, was not enough to

warrant the assertion of general jurisdiction over a non-resident
on cau se

act ion unrelated

th ose purchases .

Nor was the

Cou rt persuaded that the fact that the defendant sent p ersonn el

Texa s for training

connection

the purchases enhanced

n atu re of the contacts . Instead, the Court concluded that this was
m erely one aspect

th e package

go od s and services that the

de fen dant had purchased .

Fin al ly ,

C ou rt concluded that the

rece ip t of a check drawn from a T exa s bank was of no consequence b ecau se bank from which payment was made was caused by the a third party . Id .

fortuitou s uunilateral activity' '

The Fifth Circuit has consistently imposed the high standard

set

Supreme Court

Helicopteros when ruling on general

jurisdiction issues. See, e. ., Central Freicht Lines Inc. v. APA q
Transportation Corr w 322 F.3d 376, 381 ( th Cir. 2003) (finding no 5

general jurisdiction even though the defendant routinely arranged
an d received shipments to and from Texas and regularly sent sales p eop le Texas develop business, negotiate contracts, and

service national accounts).

Moreover, in Access Telecom,
o rd er

F.3d
c on fer

F ifth Circu it emphasized that

general jurisdiction a defendant must have a business presence in
Texas. In that case the evidence of the defendant's ( .e. ï

Telmexfs) contacts with Texas from 1990 to 1996 were numerous:
Up until 1990, Telmex leased t eleph one circuits between A r i zona and Texas . Telmex's cu rrent lines interconnect

with Texas at the border in McAllen and E1 Paso . Telmex le ased real property in Texas in 1995 and paid taxes to T exa s that same year . Telmex contracted to a warehouse 75 ,000 telephone poles in Laredo around 1990-1991. T elm ex had correspondent agreements with a number of U .S . carr ie rs . Settlement revenues from these agreements

totaled approximately $1 billion a year in 1994-1995.
The total revenues derived from Texas residents totaled m illion s of dollars a month . Telmex also solicited ads fo r yellow page ads in border cities of U .S ., although it i s unclear exactly where . Additionally, SBC is alleged to be a Texas contact of Telmex, since SBC own s a portion o f a controlling interest in Telmex and thus exerts some con tro l over Telmex . =d I footno te the Fifth C ircu it elaborated that num be r of

o th er contacts are a lso put forward, m o stly involving Telmex paying

fo r services that were provided

corp o rat ions

Texa s

the

Su ch serv ice s included consulting and finance services .' '

Id. &

The Fifth Circuit rejected the plaintiff's claim that
confer general jurisdiction

Telmex's contacts were sufficient

because nTelmex hag ) virtually no contacts which constitute doing d
b u sine ss in Texas .' Id . ' The Fifth Circuit explained that

Prima rily , Telmex interconnects its Mexican lines with Am er ic an lines, enabling long distance communication . Th e money U .S . companies pay Telmex is for service on the M exican 1eg of the call; the money the U .S . carriers rece iv e is for the U .S . 1eg of a call . As such, Mexican an d U .S . telecommunications companies do business wi th e ach other in these situations, but neither is doing

business
pu rpo ses .

in

the

other country

for

jurisdictional

Th e one contact that could constitute doing business in Te xas would be the yellow page ads . However, the ev iden ce on the yellow page ads consists of nothing more tha n a comment that Telmex solicited yellow page ads in bo rder cities in the U .S . without naming which cities,
-

3 4-

when this occurred, whether such ads were actually p lace d , or for how long . Without more , such evidence d oes not help establish continuous and systematic c ontac ts .

In sum , the totality of the contacts suggests that Telmex con duc te d a great deal of business with Texas, but

virtually none in Texas, as such general jurisdiction
cann ot be shown, even on a prima facie basis .
=d I

at 717-18. O lym p iako s argues that its contacts with Texas are
'd oes not '
ow n :

sufficient

establish general jurisdiction because
maintain offices in Texas,

re side in Texas,

or lease real property

Texas,

pay taxes Texa s .'30 '

T ex as r

m a inta in any bank accounts
contend s that by recruiting

A lt hou gh plaintiff

Re sp ert , and perhaps other Texas Gree ce , Olympiakos was doing
cited any evidence that

re sid ent s
bu sine ss

play basketball
Tex as , plaintiff

Olymp iako s has ever had a business presence The facts as stated Morris and

Texas . Respert their

decla ration s show that

1999 Olympiakos recruited them both to

p lay basketball in Greece by cont act ing Morris once by telephone , and by contacting Morris' Massachusetts-based agents and Respert's Texas-b ased agent more than once . Plaintiff has not cited and the
court has not found any case recru itm en t of state residents which court has recognized the out-of-state employment

a zd o

at

constitute substantial, systematic, and continuous contacts with a

forum state needed

subject

foreign defendant to the court's

general jurisdiction. See Clark v. Moran Towinq & Transportation
Co ., Incw 738 F . Supp . 1023, 1028 ( . . La. 1990) ( Moran Towing ED n
and Transportation Company certainly has not submitted this

court's general jurisdiction based simply on
a ctiv it ies Louisiana from December

re cru itm ent

1988 th rough March of

1989'); '

Casas

v.

Northrop

Grumman

Ship

Systems,

Inc.,

Supp .zd that

( .D . Tex. 2008) ( the Court cannot find S n
natural disaster

single recruitment effort spurred by

ev ince s continuous, systematic, or sub stant ial contacts with Texas

sufficient to establish general jurisdiction'). Because plaintiff '
has failed c ite any evidence showing that O lymp iako s ' contacts

w ith Texas have ever been so substantial, systematic, or continuous

that Olympiakos nshould have reasonably expected to be sued

Texas on any matter, however remote from

E hose ) contactsz' t

Johnston , 523 F .3d at 613 , the court concludes that the exercise of

general jurisdiction over Olympiakos would not comport with the due
p roces s guarantees of the Fourteenth Amendment .

( ) Specific Jurisdiction 2

A court may exercise specific jurisdiction over a nonresident
de fen dan t if nthe defendant 's contacts with Texas ' rise from , a
a re directly related the cause action .'' ' Lewis, 252 F.3d at

-

3 6-

( uoting Wilson v. Belin, q denied, 115 S.

F.3d 644,

( th Cir.), cert. 5

322 ( 994)). The Fifth Circuit has articulated 1

a

three-step

analysis

for

specific

jurisdiction:

' ( ) whether the defendant has minimum contacts with the 51
forum state , i .e ., whether it purposely directed its act ivit ie s toward the forum state or purposefully availed itse lf of the privileges of conducting activities there;

( ) whether the plaintiff's cause of action arises out of 2
or results from the defendant's forum-related contacts;

and ( ) whether the exercise of personal jurisdiction is 3
fai r and reasonable .' '

McFadin v. Gerber, 587 F.3d 753, 759 ( th 5

2009), pet. for

cert . filed 78 U.S. . . 3531 ( arch 3, 2010) ( o . 09-1067) ( uoting LW M N q
Seiferth v. Helicopteros Atuneros, Inc., 2006)).
one element

F.3d 266, 271 ( th 5
int ens iv e and

de cisive ; rather the touchstone

whether the

ndefend ant 's conduct and connection

forum State are such

that E t ) should reasonably anticipate being haled i
th ere .' World Wide Volkswagen, ' at 567 .

court

Pu rp o se ful Availment A s se rt ing that Morris resident of Texas, Ebert argues

th at because Olympiakos recruited Morris for employment, Olympiakos

is subject to personal jurisdiction in Texas under the Texas Long
A rm statute because Olympiakos was doing business in Texas . Ebert

cites Garcia v. Vasquez, 524

Supp. 40

Tex . 1981), as

case

w h ich nthis Court faced this very issue an d concluded that

had personal jurisdiction over the defendant.'3 'l
Gar cia , Supp . North Carolina employer

subm it ted a request for migrant farm workers
w orke r clearance system was

the national farm
Texas

transmitted

Employment Commission ( EC). A number of migrant workers who were T
T ex as residents responded to the request b y telephoning the H arlinge n , Texas, from Minnesota . During the telephone call the

commu nica ted the terms of the employment including the wages, h ou rs , and availability of housing . A number the m ig rant

wo rkers agreed to the terms of employment, but when they arrived

No rth

Carolina,

they

discovered

that

the

wages,

hours,

and

ava ilab i lity

housing were not as prom ised .

A fter the m ig ran t

wo rkers filed suit in Texas, the North Carolina farmer raised the
issu e of personal
Even

though the North Carolina employer had no regular p lace of business

designated agent

Texas, the court rejected the employer's

argum ent stating that the

E lue d

process

requirements

are

.

.

.

fulfilled.

Defendant . . . purposefully issued the job information
in North Carolina . The T.E .C . officials merely acted on h is behalf in processing the information . The privilege o f conducting activities in Texas was intentionally

invoked by E efendant q. d

This cause of action plainly

a rise s from and is connected with the alleged Texas tran saction .

M p la inti ff 's Memorandum in Opposition to Defendant's Motion to Vacate Judgment, Docket Entry No . 36, 12 .

= Id

Ga rcia stands

the principal that a nonresident

fa rm er who recruits Texas laborers to work in another state, either
d ire ctly th roug h an agent located Texas,

subject to the
from that 903-04

jurisdiction of Texas courts for claims a ri sing
recru itm en t . See Neizil v . Williams, Su pp .

( . . Fla. 1989) ( iting Garcia DC c

support

it s holding that the

d efendan t uaffirmatively established minimum contacts with

state of Florida by conducting recruitment efforts in Florida by cau sin g the transmittal
Emp lo ym en t Service and

clearance order
specifying that

Florida State
F lor id a farm labor

contractor conduct recruiting and hiring on
G arc ia , Supp . at

b ehalf') '

d istingu i sh ab le from this case

b ecau se there the request for laborers was not only communicated and distributed by the Texas-based TEC, but the plaintiffs spoke by telep hon e Texas, and during that telephone

conver sation the TEC communicated to the plaintiffs the terms and condit ion s of employment pursuant to which the plaintiffs agreed to
w ork in North Carolina . Moreover, the claims that the plaintiffs asserte d condit ions the lawsuit were claims breach the terms

emp lo ym ent that the TE C communicated to them during

th eir telephone call

Tex as .

Here, there

n o evidence that

O lymp ia kos used any Texas-based entity to recruit Morris to work G reece . Ebert contends that Olympiakos' then general manager,

L iv erato s , spoke directly to Morris by telephone but Ebert has not

cited any evidence showing that either Morris or Liveratos was

Texa s during that telephone conversation .

Ebert contends that

a fte r Morris told Liveratos that he would play basketball for

O lymp ia kos ,

Liveratos

asked

Morris

address

that

O lym p ia kos could send something to him and that within days Morris rece iv ed from Olympiakos, at his Texas residence, an itinerary and airl in e tickets Europe . But Ebert has not cited any evidence

sh ow ing that before Morris spoke on the telephone with Liveratos
and agreed to play basketball for Olympiakos, i .e ., when Olymp ia ko s recru ited Morris through Morris' Massachusetts-based agents, that

Olymp iako s knew or had reason Texa s resident .
Th e facts

know that

was recruiting a

th is case are also distinguishable from other

recruitm ent cases in which courts have found that the exercise of

specific jurisdiction comports
p roce ss . For example,

the requirements of due
Contractors, Inc w

Runnels v . TMSI

( th Cir. 1985), 5

Saudi Arabian limited partnership
come to work for

rec ru ited the p laint iff , a Louisiana resident,

in Saudi Arabia . The partnership had placed job advertisements in two Louisiana n ew spap er s for approximately five years, and its re sid ent agent in California had mailed sample and actual contracts the plaintiff at his home Louisiana . The plaintiff took the

job and worked in Saudi Arabia for over a year before he was fired.
The plaintiff b rough t sit in Louisiana for wrongful discharge .

-

4 0-

concluding

that

Louisiana

court

could

exercise personal

jurisdiction over the Saudi Arabian partnership, the Fifth Circuit
stated :

B ecau se TMSI Arabia solicited Louisiana residents through local advertising and through its agent, because its c onta cts with Louisiana were deliberate rather than fo rtu itou s, and because it could reasonably foresee that c ont ra ct disputes would likely arise as a result of its solic itat io n of United States citizens, it is not unfair to require that TMSI Arabia defend this suit in Lou i siana .

764 F.2d at 423. See also Clark,

Supp . at 1029-30 ( olding h

that court could exercise specific jurisdiction over nonresident
entity that pu rp ose fu lly directed recruitment activities

toward s the state by advertising in local newspaper and conducting

interviews in the state); Dotson v. Fluor Corpw 492

Supp . 313,

314-317 ( . . Tex. 1980) ( olding that the defendant purposefully WD h
av ailed itself by using an agent authorized to do business in Texas
rec ru it Texas emp lo yees work overseas by placing

ad vert isem en ts

Texas newspaper); Gon sa le z Moreno v . Milk Supp . d z ( .D . Tex. 2002) ( inding W f

Train, Incw

jurisdiction where defendant contacted
recruit Texas residents p rov ided

farm labor service
New York,

migrant farm employment

fa rm labor service

term s and conditions fee each migrant

emp loyme nt , paid the farm labor service w orker provided , hired plaintiffs as serv ice 's recruitment

result of the farm labor fare New

Texas, paid plaintiffs

York, and plaintiffs signed their employment contracts in Texas).

For the reasons explained above , the court concludes that th ere ev en no evidence from which the court can reasonably conclude infer that when Olymp iakos recruited Morris had reason play know that

b asketba ll Mo rris was

G reec e , Olympiakos knew

Te xa s resident such that Olympiakos purposefully

avai le d itself of the p rivileg e of doing business

Texas could

rea son ab ly anticipate being haled into court there . Moreover, even
the evidence were sufficient establish that by recruiting

M orr is

play basketball

in

Greece, Olympiakos purposefully Texas, the

av ailed itself of the privilege of doing business

ev idence would still not be sufficient for the court to exercise

personal jurisdiction over Olympiakos because the evidence does not
m eet the requirement that the claims asserted in this action arise from or be connected with that act of recruitment. See Van Pelt v .

Best Workover, 798 S. . d 14, 16 ( ex . pp . E1 Paso, 1990, no writ) W2 T A

(' he recruitment 'T
act ion must arise

Texas
from or

not alone sufficient. The cause
be connected with that act

recruitment .') . '

C laim s Arising from Forum Contacts
E ven

O lymp iakos directly recruited Morris in Texas, the

court may not exercise personal jurisdiction over Olympiakos unless
the claims rec ru itm en t . th is action arise out of or result from that act of Van Pelt, S . .2d W Be cau se Ebert has not

-

42-

presented any evidence showing fraud claims alleged

the breach of contract and/or
of result from

th is action arise

wh ich Morris spoke with Liveratos, from tr ave l itinerary and airline tickets that Morris

rece iv ed from Olympiakos at

Texas residence , the court has no

rea son to conclude that the exercise of specific jurisdiction over Olymp iako s satisfies the due process requirements of the Fourteenth
Amen dm en t .

( ) Breach of Contract A
Pla in tif f alleges :

18 . On August 31, 1999, M or ris and Olympiakos entered in to a written Agreement.
19 . Pursuant to the Agreementr Olymp iako s was to provide qua lified medical assistance for Morris as well as to pay M or ris for his basketball services . 20 . Olympiakos has breached