Tate v. RCI, LLC Registered Agent: Corporate Creations Network Inc et al

Filing 50

MEMORANDUM AND OPINION entered DENYING 47 MOTION for Reconsideration of 27 MOTION to Dismiss pursuant to Rule 12(b)(2) and Rule 12(b)(4) & (5). (Signed by Chief Judge Lee H Rosenthal) Parties notified.(leddins, 4)

United States District Court
Southern District of Texas

ENTERED
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
RICHARD JAMES TATE,
Plaintiff,
v.
RCI, LLC and
VALLARTA ADVENTURES SA de CV
Defendants.

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June 08, 2018
David J. Bradley, Clerk

CIVIL ACTION NO. H-17-290

MEMORANDUM & OPINION DENYING VALLARTA ADVENTURES’
MOTION FOR RECONSIDERATION
Vallarta Adventures asks the court to reconsider its ruling that the plaintiff, Richard Tate,
made a prima facie showing that personal jurisdiction over Vallarta exists, sufficient to withstand
Vallarta’s Rule 12(b)(2) motion to dismiss. (Docket Entry No. 47). For the reasons stated
below, the motion is denied.
I.

Background
Vallarta moved to dismiss for lack of personal jurisdiction, arguing that its suit-related

contacts with Texas were insufficient to justify personal jurisdiction. (Docket Entry No.
27). After careful consideration of the motions, the record evidence, and the arguments of
counsel, the court denied the motion, finding sufficient minimum contacts with Texas through
Vallarta’s interactive website. (Docket Entry No. 39).
Vallarta now asks the court to reconsider that ruling, arguing that newly
produced evidence shows that Vallarta’s contacts with Texas were not the “but-for” cause
of Tate’s injury. (Docket Entry No. 47). Tate opposes the motion, arguing that the court already

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ruled on this issue and that nothing requires reconsideration or revision.
II.

The Legal Standard for Reconsideration
“Rule 54(b) allows parties to seek reconsideration of interlocutory orders and authorizes

the district court to ‘revise[] at any time’ ‘any order or other decision . . . [that] does not end the
action.’” Austin v. Kroger Tex., L.P., 864 F.3d 326, 336 (5th Cir. 2017) (quoting FED. R. CIV.
P. 54(b)) (per curiam). An interlocutory order is one that “adjudicates fewer than all the claims
or the rights and liabilities of fewer than all the parties [and] does not end the action as to any of
the claims or parties.” FED. R. CIV. P. 54(b). “Under Rule 54(b), ‘the trial court is free to
reconsider and reverse its decision for any reason it deems sufficient, even in the absence of new
evidence or an intervening change in or clarification of the substantive law.’” Austin, 864 F.3d
at 336 (quoting Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 185 (5th Cir.
1990)). The Rule 54(b) standard is “more flexible” than the standard for other motions to
reconsider and “reflect[s] the ‘inherent power of the rendering district court to afford such relief
from interlocutory judgments as justice requires.’” Id. (quoting Cobell v. Jewell, 802 F.3d 12,
25–26 (D.C. Cir. 2015)). “It is within the discretion of the court whether to grant a motion to
reconsider an interlocutory order.” Deeds v. Whirlpool, No. Civ. A. H-15-2208, 2017 U.S. Dist.
LEXIS 127461, at *31 (S.D. Tex. Aug. 10, 2017).
III.

Analysis
Vallarta argues for reconsideration on a narrow issue—that Vallarta’s contacts

with Texas were not the “but-for” cause of Tate’s injuries because Tate did not rely solely on
Vallarta’s website in deciding to purchase the excursion. As a result, Vallarta argues, Tate’s
lawsuit did not “arise out of or result from” Vallarta’s forum-related contacts and the court lacks
personal jurisdiction over Vallarta. Vallarta bases its argument on new evidence Tate

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submitted in response to the codefendant RCI’s motion for summary judgment. Vallarta argues
that David Lee’s affidavit “conclusively negate[s] the basis of the Court’s prior ruling.” (Docket
Entry No. 47 at 6). In his affidavit, Lee states: “Dick and I relied upon Mr. Bautista’s expertise
to choose a safe tour operator.

Were it not for Mr. Bautista’s representations and

recommendations that we go on a Vallarta Adventures tour, neither myself nor Mr. Tate would
have done so.” (Docket Entry No. 41-4 at 2). The testimony, Vallarta argues, shows that in the
absence of viewing the Vallarta website, Tate still would have purchased the excursion.
Tate responds that Lee’s testimony is speculative because he does not know Tate’s state
of mind or reasons for purchasing the Vallarta excursion. (Docket Entry No. 29 at 4). Tate also
attaches several additional exhibits to his response to the motion to reconsider. There is no
indication that the exhibits could not have been submitted earlier and the court does not consider
them. A motion for reconsideration is not an invitation to rehash the arguments or take a second
bite at the apple. See, e.g., DAC Surgical Partners P.A. v. United Healthcare Servs., 2017 U.S.
Dist. LEXIS 129215, at *9 (S.D. Tex. Aug. 14, 2017) (“However, while this discretion exists, the
Court does not believe that it negates the policy reasons behind discouraging motions for
reconsideration which rehash the same arguments or, without justification, raise new arguments
for the first time. Using an overly generous standard in reviewing motions under Rule
54(b) would reduce judicial efficiency and give parties no incentive to raise all relevant
arguments at first consideration of an issue; the fact that the Court retains the power to revise
interlocutory orders does not give parties the right to continuously revisit the same
issues.”). Even if the court considered Tate’s additional evidence, the outcome does not change.
The narrow issue is whether the court should reconsider its previous ruling in light of the new
evidence in the Lee affidavit.

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Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, the “plaintiff bears the
burden of establishing a district court’s jurisdiction over a non-resident, but it need only make
a prima

facie case”

if

the

district

court

does

not

conduct

an

evidentiary

hearing. Johnston v. Multidata Sys. Int’l Corp., 523 F.3d 602, 609 (5th Cir. 2008) (citation
omitted). At the motion to dismiss stage, “[p]roof by a preponderance of the evidence is not
required.” Id. (citing Bullion v. Gillespie, 895 F.2d 213, 217 (5th Cir. 1990)). In deciding
whether personal jurisdiction exists, “the court may receive . . . any combination of
the recognized methods of discovery to help it resolve the jurisdictional issue.” Walk Haydel &
Assocs. v. Coastal Power Prod. Co., 517 F.3d235, 241 (5th Cir. 2008). “But even if the court
receives discovery materials, unless there is a full and fair hearing, it should not act as a fact
finder and must construe all disputed facts in the plaintiff’s favor and consider them along with
the undisputed facts.” Id. “[O]n a motion to dismiss for lack of jurisdiction, uncontroverted
allegations in the plaintiff’s complaint must be taken as true, and conflicts between the facts
contained in the parties’ affidavits must be resolved in the plaintiff’s favor for purposes of
determining whether a prima facie case for personal jurisdiction exists.” Johnston, 523 F.3d at
609 (quoting D.J. Invs., Inc. v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542, 546
(5th Cir. 1985)).
To satisfy the minimum contacts necessary to exercise personal jurisdiction over a
foreign defendant, the defendant’s suit-related conduct must “arise from or relate to” the
minimum contacts with the forum state. “The Supreme Court has yet to distinguish between the
‘arise out of’ and ‘relate to’ requirements.” In re Chinese-Manufactured Drywall Prods. Liab.
Litig., 753 F.3d 521, 543 (5th Cir. 2014). “There are three schools of thoughts regarding what
‘arising out of or related to’ means in the context of specific jurisdiction, and the Fifth

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Circuit remains a proverbial free agent, having not yet expressly taken a position.” Benson v.
Rosenthal, 116 F. Supp. 3d 702, 710 (E.D. La. 2015) (discussing the approaches of other
circuits). “While many circuits have expressly adopted some variation of these tests, the Fifth
Circuit has not. Many other courts, however, have read the Fifth Circuit’s analyses to infer a
preference for the ‘but for’ standard.” Id. (collecting cases); see also Guzman v. Mem’l Hermann
Hosp. Sys., No. H-07-3973, 2008 U.S. Dist. LEXIS 101781 (S.D. Tex. Dec. 17, 2008) (collecting
cases); FMC Int’l A.G. v. ABB Lummus Global, Inc., No. H-04-3896, 2005 U.S. Dist. LEXIS
40602 (S.D. Tex. July 22, 2005) (“The Fifth Circuit appears to have adopted a ‘but-for’
causation test to determine if the contact is sufficiently related to the plaintiff’s cause of
action.”).
Tate previously argued that he relied on Vallarta’s website in choosing to purchase
the zipline and waterslide excursion tickets. He browsed the site from his home in Texas. The
information and testimonials on the site led him to purchase the tickets from Vallarta when he
arrived in Mexico. Resolving conflicting facts and inferences in Tate’s favor, his testimony
was enough for the prima facie showing needed to overcome Vallarta’s motion to dismiss. The
Lee affidavit does not change the outcome. Lee’s testimony speculates about Tate’s mindset and
about what he relied on in deciding to purchase the Vallarta excursion.
Vallarta relies on Head v. Las Vegas Sands, LLC, No. 7:17-CV-00426, 2018 U.S. Dist.
LEXIS 51541

(S.D.

Tex.

Mar.

27,

2018),

to

support

its

argument.

The

facts

of Head are distinguishable. In Head, a wife sued the Las Vegas Sands Casino for enabling her
husband’s gambling, which caused him to fall deeply into debt and eventually commit
suicide. The court analyzed a long list of alleged actions the casino took to keep the plaintiff’s
husband coming back to gamble, only one of which had any connection to Texas. The court

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concluded that in the absence of sending corporate jets to McAllen, Texas to take the plaintiff’s
husband to Las Vegas, her husband still would have gone and gambled extensively. “Simply
put, Plaintiffs allege so many different ways in which Defendants enticed Decedent to gamble,
that it is impossible to say jet transportation from Texas to Las Vegas—alone—was a but-for
cause of Plaintiffs’ [claims].” Head, 2018 U.S. Dist. LEXIS 51541, at *17. Here, by contrast,
Tate alleges that he viewed Vallarta’s website from home and later purchased tickets from
Bautista, who reassured Tate and his family that Vallarta was the safest option. Unlike Head, in
this case, it is plausible to conclude that without his research on Vallarta’s website, Tate would
not have purchased the Vallarta excursion.
IV.

Conclusion
Vallarta’s motion for reconsideration, (Docket Entry No. 47), is denied.
SIGNED on June 8, 2018, at Houston, Texas.

_______________________________________
Lee H. Rosenthal
Chief United States District Judge

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