Oto Analytics v. Capital Plus Financial — Motion for Reconsideration of Order Dismissing Blueacorn Defendants

Summary

Plaintiff's Opposed Motion, filed May 16, 2022 as Document 88 by Oto Analytics, Inc. d/b/a Womply against Capital Plus Financial, LLC, et al., in the United States District Court for the Northern District of Texas. Womply asks the Court to reconsider its April 11, 2022 Order (ECF No. 68) dismissing the Blueacorn Defendants for lack of personal jurisdiction, or to allow Womply to replead the claims against Blueacorn in a Second Amended Complaint, or to enter a partial, appealable judgment as to Blueacorn under Federal Rule of Civil Procedure 54(b). The motion argues that the Court wrongly required a party to sign and perform a contract in the forum state and overlooked allegations about Blueacorn's relationship with Texas-based Capital Plus. The certificate of conference states that counsel for Blueacorn opposed the motion.

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Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 1 of 24 PageID 1741

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION

OTO ANALYTICS, INC. d/b/a WOMPLY, §
§
Plaintiff, §
§
v. § Civil Action No. 3:21-cv-2636-B
§
CAPITAL PLUS FINANCIAL, LLC, §
CROSSROADS SYSTEMS, INC., ERIC §
DONNELLY, BA FIN ORION, LLC d/b/a §
BLUEACORN, and BARRY CALHOUN, §
§
Defendants.

PLAINTIFF’S OPPOSED MOTION (1) FOR RECONSIDERATION OF THE COURT’S
ORDER DISMISSING THE BLUEACORN DEFENDANTS FOR LACK OF PERSONAL
JURISDICTION UNDER THE CURRENT COMPLAINT, (2) FOR LEAVE TO
REPLEAD ITS CLAIMS AGAINST BLUEACORN, OR (3) TO DIRECT ENTRY OF
FINAL, APPEALABLE JUDGMENT AS TO BLUEACORN

Alexander L. Cheney (admitted pro hac vice) Nina Cortell
Willkie Farr & Gallagher LLP Texas Bar No. 04844500
One Front Street Jason P. Bloom
San Francisco, CA 94111 Texas Bar No. 24045511
(415) 858-7400 Haynes and Boone, LLP
acheney@willkie.com 2323 Victory Avenue, Suite 700
Dallas, TX 75219
Mark T. Stancil (admitted pro hac vice) (214) 651-5000
Joshua S. Levy (admitted pro hac vice) nina.cortell@haynesboone.com
Willkie Farr & Gallagher LLP jason.bloom@haynesboone.com
1875 K Street, N.W.
Washington, D.C. 20006
(202) 303-1000
mstancil@willkie.com
jlevy@willkie.com

Attorneys for Plaintiff Oto Analytics, Inc.
d/b/a Womply

May 16, 2022
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 2 of 24 PageID 1742

TABLE OF CONTENTS

Page

PRELIMINARY STATEMENT .....................................................................................................1

ARGUMENT ...................................................................................................................................4

I. THE COURT SHOULD RECONSIDER ITS ORDER DISMISSING
BLUEACORN FOR LACK OF PERSONAL JURISDICTION BASED ON THE
COMPLAINT. .....................................................................................................................4

A. The Complaint Alleges That Womply’s Contract Claims Against Blueacorn
Have A Substantial Connection to Texas. ...............................................................4

B. The Complaint Alleges That Womply’s Tort Claims Against Blueacorn
Have A Substantial Connection To Texas. ............................................................11

II. ALTERNATIVELY, THE COURT SHOULD SET ASIDE ITS ORDER AND
PERMIT WOMPLY TO REPLEAD ITS CLAIMS AGAINST BLUEACORN IN
ITS SECOND AMENDED COMPLAINT. ......................................................................14

III. IN THE ALTERNATIVE, THE COURT SHOULD DIRECT ENTRY OF FINAL
JUDGMENT AS TO BLUEACORN UNDER FED. R. CIV. P. 54(b). ...........................16

CONCLUSION AND PRAYER FOR RELIEF ............................................................................17

CERTIFICATE OF CONFERENCE .............................................................................................19

CERTIFICATE OF SERVICE ......................................................................................................19
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 3 of 24 PageID 1743

TABLE OF AUTHORITIES

Cases Page(s)

Am. Airlines, Inc. v. Rogerson ATS,
952 F. Supp. 377 (N.D. Tex. 1996) ...........................................................................................9

Anderson v. T&D Machine Handling Inc.,
85 F.3d 625 (5th Cir. 1996) .....................................................................................................17

Animale Grp., Inc. v. Sunny’s Perfume, Inc.,
2007 WL 2010476 (S.D. Tex. July 5, 2007) ......................................................................16, 17

Atwood Hatcheries v. Heisdorf & Nelson Farms,
357 F.2d 847 (5th Cir. 1996) .....................................................................................................9

Austin v. Kroger Texas, L.P.,
864 F.3d 326 (5th Cir. 2017) .....................................................................................................4

Avdeef v. Google, Inc.,
678 F. App’x 239 (5th Cir. 2017) ............................................................................................16

Bristol-Myers Squibb Co. v. Super. Ct. of Cal., San Francisco Cty.,
137 S. Ct. 1773 (2017) ...............................................................................................................8

Burger King Corp. v. Rudzewicz,
471 U.S. 462 (1985) ......................................................................................................... passim

Calder v. Jones,
465 U.S. 783 (1984) .................................................................................................................12

Cent. Freight Lines Inc. v. APA Transp. Corp.,
322 F.3d 376 (5th Cir. 2003) ...................................................................................................12

Cooper Tire & Rubber Co. v. Farese,
423 F.3d 446 (5th Cir. 2005) ...................................................................................................16

Danziger & De Llano v. Morgan Verkamp L.L.C.,
24 F.4th 491 (5th Cir. 2022) ................................................................................................2, 13

Def. Distributed v. Grewal,
971 F.3d 485 (5th Cir. 2020) ...................................................................................................13

Dubea v. Simpson,
2009 WL 528258 (E.D. Tex. Mar. 2, 2009) ..............................................................................9

Ex Parte Reindel,
963 So.2d 614 (Ala. 2007) .......................................................................................................14

- ii -
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 4 of 24 PageID 1744

Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct.,
141 S. Ct. 1017 (2021) .........................................................................................................8, 16

Franklin v. N.,
2012 WL 12878159 (N.D. Tex. July 6, 2012) .........................................................................17

Freedom Path, Inc. v. Lerner,
2015 WL 770254 (N.D. Tex. Feb. 24, 2015) ...........................................................................17

Guidry v. U.S. Tobacco Co., Inc.,
188 F.3d 619 (5th Cir. 1999) ...................................................................................................13

Hoffman v. L&M Arts,
774 F. Supp. 2d 826 (N.D. Tex. 2011) ....................................................................................17

Int’l Energy Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd.,
818 F.3d 193 (5th Cir. 2016) .............................................................................................5, 6, 7

J & M Assocs., Inc. v. Romero,
488 F. App’x 373 (11th Cir. 2012) ..........................................................................................14

Lavespere v. Niagara Mach. & Tool Works, Inc.,
910 F.2d 167 (5th Cir. 1990) .....................................................................................................4

McGee v. Int’l Life Ins. Co.,
355 U.S. 220 (1957) .................................................................................................................11

Miss. Interstate Express, Inc. v. Transpo, Inc.,
681 F.2d 1003 (5th Cir. 1982) .................................................................................................12

Monkton Ins. Servs. Ltd. v. Ritter,
768 F.3d 429 (5th Cir. 2014) .................................................................................................5, 6

Nat’l Indus. Sand Assoc. v. Gibson,
897 S.W.2d 769 (Tex. 1995)....................................................................................................14

Pervasive Software Inc. v. Lexware GmbH & Co. KG,
688 F.3d 214 (5th Cir. 2012) ...................................................................................................10

Polythane Sys., Inc. v. Marina Ventures Int’l, Ltd.,
993 F.2d 1201 (5th Cir. 1993) ...................................................................................................9

Prod. Promotions, Inc. v. Cousteau,
495 F.2d 483 (5th Cir. 1974) .................................................................................................8, 9

Sangha v. Navig8 ShipManagement Private Ltd.,
882 F.3d 96 (5th Cir. 2018) ...................................................................................................6, 7

- iii -
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 5 of 24 PageID 1745

Sedillo ex rel. Filo & Fran Sedillo Revocable Tr. v. Team Techs., Inc.,
2020 WL 6870711 (N.D. Tex. Nov. 23, 2020) ........................................................................11

Seiferth v. Helicopteros Atuneros, Inc.,
472 F.3d 266 (5th Cir. 2006) ...............................................................................................7, 10

Shippitsa Ltd. v. Slack,
2019 WL 277613 (N.D. Tex. Jan. 22, 2019) ...........................................................................17

Stewart v. Atherio, Inc.,
2018 WL 2047997 (N.D. Tex. May 2, 2018) ..........................................................................14

Texas Capital Bank, N.A. v. Garden World of Holiday, Inc.,
2009 WL 2824700 (E.D. Tex. Aug. 27, 2009) ..........................................................................9

Unspam Techs, Inc. v. Chernuk,
716 F.3d 322 (4th Cir. 2013) ...................................................................................................14

Walden v. Fiore,
571 U.S. 277 (2014) ...............................................................................................................5, 6

Wien Air Alaska, Inc. v. Brandt,
195 F.3d 208 (5th Cir. 1999) ...................................................................................................13

Rules and Regulations

13 C.F.R. § 103.1(d) ......................................................................................................................11

Fed. R. Civ. P. 15(a)(2) ..............................................................................................................3, 14

Fed. R. Civ. P. 54(b) ............................................................................................................4, 16, 17

- iv -
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 6 of 24 PageID 1746

PRELIMINARY STATEMENT

Plaintiff Womply respectfully submits this motion for reconsideration of the Court’s

April 11, 2022 Order (ECF No. 68; “Order”) dismissing Blueacorn for lack of personal

jurisdiction.1 Given the current procedural posture of this case—in particular, Womply’s

forthcoming Second Amended Complain (“SAC”) in response to the Court’s decision on the

remaining Defendants’ motion to dismiss—Womply proposes three forms of relief: the Court

(1) reconsider and set aside its Order based on the current First Amended Complaint (“Complaint”

or “Am. Compl.”; ECF No. 20) and permit Womply’s claims against Blueacorn to proceed; (2) set

aside its Order and reconsider personal jurisdiction based on the SAC; or (3) enter a partial,

appealable judgment with respect to Blueacorn under Federal Rule of Civil Procedure 54(b).

(1) Reconsideration of the Order is appropriate based on the Complaint because the Court’s

dismissal reflects three legal errors—two related to Womply’s contract claims and one related to

Womply’s tort claims.

First, the Court’s decision dismissing Womply’s contract claims rests on a

misinterpretation of law. In concluding that those claims did not arise from Blueacorn’s minimum

contacts with Texas, the Court held “that a party must sign and perform in the forum state for

personal jurisdiction to exist.” (Order at 16 (emphasis in original).) The Supreme Court, however,

“long ago rejected the notion that personal jurisdiction might turn on mechanical tests or on

conceptualistic theories of the place of contracting or performance.” Burger King Corp. v.

Rudzewicz, 471 U.S. 462, 478–79 (1985) (cleaned up). Accordingly, the Fifth Circuit and

1
As noted in prior motions practice, “Womply” refers to Plaintiff Oto Analytics, Inc. d/b/a
Womply, and “Blueacorn” refers to Defendants BA Fin Orion d/b/a Blueacorn and Barry Calhoun.
Unless otherwise noted, capitalized terms shall carry the same meanings in Womply’s
memorandum in opposition to Blueacorn’s motion to dismiss (ECF No. 45).
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 7 of 24 PageID 1747

numerous District Courts within this Circuit have upheld personal jurisdiction where a contract

was signed elsewhere but certain activities under the contract were performed in the forum state.

(See infra Section I.A.1 (collecting cases).) None of the cases cited in the Court’s opinion holds

otherwise.

Second, although the Court acknowledged “that Womply and Blueacorn’s agreements had

a ‘substantial connection with Texas’ because of the large number of applications and the actual

monetary value of these contracts” (Order at 17 (quoting Burger King, 471 U.S. at 479)), the Court

improperly overlooked numerous allegations in Womply’s Complaint to draw the inference

against Womply that these were “one-way contacts” that “did not solidly connect Blueacorn to

Texas.” (Id.) As a result, and by way of example, the Court overlooked the allegation that

Blueacorn stood to earn many millions of dollars from Texas-based Capital Plus by acting as

Capital Plus’s agent with the federal government. Blueacorn’s relationship with Capital Plus in

Texas was as bilateral as it gets: As Capital Plus’s formal Lender Service Provider, Blueacorn sent

thousands of loans to Capital Plus in Texas and received nearly half of its revenue from Texas-

based Capital Plus.

Third, as to Womply’s tort claims, although the Court recognized that Blueacorn’s

misconduct had “effects” in Texas (id. at 15), it failed to properly credit those effects. The effects

here were extensive, such as causing Texas-based Capital Plus to collect fees on tens of thousands

of loan transactions, which fees are (contrary to Blueacorn’s misrepresentations to Womply)

apparently beyond the reach of Blueacorn. Respectfully, this case bears no resemblance to

Danziger & De Llano v. Morgan Verkamp L.L.C., 24 F.4th 491 (5th Cir. 2022), and, in any event,

that case did not purport to reverse the longstanding rule that tortious conduct causing significant,

anticipated effects in the forum state is sufficient to establish personal jurisdiction. Here,

-2-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 8 of 24 PageID 1748

Blueacorn’s tortious conduct caused tens of millions of dollars in fees from tens of thousands of

transactions to flow into the pockets of a Texas business—no court has ever suggested such

consequences would not support personal jurisdiction.

(2) Alternatively, Womply respectfully requests leave to include in its forthcoming Second

Amended Complaint additional allegations to address the Order’s stated concerns regarding

personal jurisdiction, and to return Blueacorn and Calhoun as defendants in this action. In its

May 11, 2022 Order granting in part and denying in part Capital Plus’s motion to dismiss (“May 11

Order”; ECF No. 82), the Court granted Womply “one chance to amend its pleadings” to file a

“second amended complaint,” because “[t]he court should freely give leave to amend when justice

so requires.” (May 11 Order at 28–29 (quoting Fed. R. Civ. P. 15(a)(2)) (cleaned up).) The Court

should likewise give Womply the opportunity to replead its claims against Blueacorn and further

allege Blueacorn’s substantial contacts with Texas—including payment of fees from Texas; emails

and chats demonstrating Blueacorn’s deep commercial relationship with Texas-based Capital Plus

(e.g., communications in which Blueacorn declared to Womply “*we = Cap Plus”); and marketing

materials directed to PPP loan applicants in Texas. Moreover, many of the allegations Womply

will add in response to the Court’s May 11 Order will necessarily implicate Blueacorn’s contacts

with Texas. The Court could render its ultimate decision on whether the Blueacorn Defendants

should remain parties after reviewing this more fulsome backdrop. Womply respectfully submits

that interests of efficiency would be served by such a course of action.

(3) Finally, absent any other relief requested above, the Court should enter an appealable

partial judgment as to Blueacorn under Rule 54(b). Such orders are common when some (but not

all) defendants are dismissed for lack of personal jurisdiction. Allowing Womply to take an

immediate appeal would facilitate expeditious resolution of this important threshold issue.

-3-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 9 of 24 PageID 1749

ARGUMENT

I. THE COURT SHOULD RECONSIDER ITS ORDER DISMISSING BLUEACORN
FOR LACK OF PERSONAL JURISDICTION BASED ON THE COMPLAINT.

The Court can “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 v. Kroger Texas, L.P., 864 F.3d 326, 336 (5th Cir. 2017) (quoting Lavespere v. Niagara

Mach. & Tool Works, Inc., 910 F.2d 167, 185 (5th Cir. 1990)); see Fed. R. Civ. P. 54(b) (“any

order or other decision . . . may be revised at any time before the entry of a judgment adjudicating

all the claims and all the parties’ rights and liabilities”). Womply respectfully requests that

reconsideration of the Order is appropriate because the Complaint more than adequately alleges

facts necessary to support personal jurisdiction over Blueacorn on both Womply’s contract and

tort claims.

A. The Complaint Alleges That Womply’s Contract Claims Against Blueacorn
Have A Substantial Connection to Texas.

The Court correctly held that (i) “Blueacorn entered an agreement centered in Texas”;

(ii) “[t]he negotiations centered around drawing Womply into an agreement to facilitate the

origination of loans through Capital Plus in Texas”; (iii) “Blueacorn facilitated and individually

transmitted 86,521 PPP loans from Womply to Capital Plus in Texas” as a result of these

agreements; (iv) “[i]n effect Blueacorn directed these loan applications to Texas”; and

(v) Blueacorn therefore “ha[s] enough minimum contacts with Texas to warrant personal

jurisdiction.” (Order at 12.) The Court nonetheless concluded that Womply’s “breach-of-contract

claims do not allow the Court to exert personal jurisdiction over the Blueacorn Defendants.” (Id.

at 16.) Respectfully, the Court’s analysis contains two errors.

-4-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 10 of 24 PageID 1750

1. There Is No Requirement That A Party Must Sign And Perform A Contract
In The Forum State.

The Court held that “[t]he Fifth Circuit has repeatedly made clear that a party must sign

and perform in the forum state for personal jurisdiction to exist.” (Order at 16 (emphasis in

original; citing cases).) That is incorrect; to the contrary, “[t]he [Supreme] Court long ago rejected

the notion that personal jurisdiction might turn on mechanical tests or on conceptualistic theories

of the place of contracting or performance.” Burger King, 471 U.S. at 478–79 (cleaned up)

(collecting cases). A requirement that a contract must be signed and performed in a forum state

would be a paradigmatic example of such a “mechanical test” focused on “the place of contracting

or performance.”

None of the cases cited in the Order holds otherwise. International Energy Ventures

Management, L.L.C. v. United Energy Group., Ltd., 818 F.3d 193, 212 (5th Cir. 2016), did not

purport to require that a contract be both signed and performed in a forum state. For starters, the

Court there considered an “unwritten agreement”; if signing a contract in the forum state were

necessary for personal jurisdiction, the Court would have ended its analysis there, rather than

conducting a broader “inquiry” into “‘the relationship among the defendant, the forum, and the

litigation.’” Id. at 212 (quoting Walden v. Fiore, 571 U.S. 277, 284 (2014)).2 The Fifth Circuit

referred to the place of signing and place of performance only when reciting a list of items,

including a failure to “conduct business in the state,” whose combined absence would not suffice

to establish personal jurisdiction:

2
The Order noted that International Energy Ventures quoted Monkton Insurance Services Ltd. v.
Ritter, 768 F.3d 429, 430, 432 (5th Cir. 2014), but the quoted passage from Monkton includes the
entire block-quoted text.

-5-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 11 of 24 PageID 1751

[T]here are not sufficient contacts with a forum state “when the defendant does not
have a physical presence in the state; it did not conduct business in the state; and
the contract underlying the business transaction at issue in the lawsuit was not
signed in the state and did not call for performance in the state.”

Id. (emphasis and double emphasis added) (quoting Monkton, 768 F.3d at 433).3 The Fifth Circuit

did not (and had no occasion to) suggest that personal jurisdiction over a contract claim requires

both signing a contract in the forum and performance in the forum.

Indeed, the Fifth’s Circuit’s reliance on Walden further disproves any such categorical rule.

Walden reaffirmed Burger King and confirmed that personal jurisdiction may be asserted “over

defendants who have purposefully ‘reach[ed] out beyond’ their State and into another by, for

example, entering a contractual relationship that ‘envisioned continuing and wide-reaching

contacts’ in the forum State.” 571 U.S. at 285 (quoting Burger King, 471 U.S. at 479–80)). That

is precisely the case here: Blueacorn’s contractual relationships with Womply resulted in literally

tens of thousands of contacts with Texas. As the Court’s opinion elsewhere recognized, “[e]very

application that Blueacorn sent to Capital Plus created a new contact with Texas, regardless of

whether Blueacorn made contact with Womply in the State.” (Order at 12.) In the language of

International Energy Ventures, Blueacorn indisputably “conduct[ed] business” in Texas—to the

tune of hundreds of millions of dollars in loans and tens of millions of dollars in fees. 818 F.3d at

212.

3
As the full quotation from Monkton makes clear, that case did not hold that personal jurisdiction
requires both signing and performance of a contract in the forum state. Monkton held only that
there was no personal jurisdiction over a Cayman Islands bank arising from alleged breaches of an
account agreement the bank had with a Cayman Islands company, where the owner of the Cayman
Islands company resided in Texas and received certain account-related communications and
transfers—directed by others, not by the bank—in Texas. See 768 F.3d at 433–34. Those facts bear
no resemblance to this case, where Blueacorn sent literally tens of thousands of loan applications
to Capital Plus in Texas.

-6-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 12 of 24 PageID 1752

The Court also cited Sangha v. Navig8 ShipManagement Private Ltd., 882 F.3d 96, 103

(5th Cir. 2018) (Order at 16), but that case did not establish a “sign and perform” requirement.

Sangha merely repeated the above-quoted passage from International Energy Ventures,4 and

likewise relied on Walden. Moreover, Sangha involved a tort claim for tortious interference with

contract, not a breach of contract claim. The only reference in Sangha to the location of the

contract’s formation was in a footnote observing that it was signed in Florida and did not

“specifically refer to the Port of Houston” or require that the plaintiff’s “work would be confined

to the Gulf of Mexico.” 882 F.3d at 103 n.2. Even if such an observation were relevant here, that

case bears no resemblance to contracts allowing Blueacorn to deliver 86,521 loan applications to

Capital Plus in Texas, which in turn allowed Capital Plus to preclude Womply from obtaining

more than $76 million in fees it is owed. (Order at 2–4.)

Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 273 (5th Cir. 2006) (Order at 16) is

likewise inapposite. That case concerned tort claims for “defective design, failure to warn,

negligence, and negligence per se,” not a breach of contract action. Id. at 274. It did not purport to

establish a rule for personal jurisdiction over a breach-of-contract action. The Court addressed

contract issues only in responding to the plaintiff’s attempt to use the “stream-of-commerce

theory” to hold the helicopter’s owner (defendant HAI) liable for his injuries. The plaintiff suffered

those injuries when using the helicopter on behalf of his employer, which had leased the helicopter

from HAI. Id. In rejecting that argument, the Court noted that “HAI did not have a physical

presence in Mississippi. It did not conduct business in the state. Its contract with Air 2 [plaintiff’s

employer] was not signed in Mississippi, nor did the contract call for performance in the state.” Id.

4
Sangha also reproduced the passage from Monkton that is quoted in International Energy
Ventures and block-quoted above. See Sangha, 882 F.3d at 103.

-7-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 13 of 24 PageID 1753

at 272 (emphasis added). Thus, not only do the facts of Seiferth differ significantly from those at

issue here, the Fifth Circuit there merely reiterated the same uncontroversial observation as in

International Energy Ventures and Sangha: The complete absence of any connection by the

defendant with the forum state—including “doing business” in the forum state—forecloses

personal jurisdiction. Here, by contrast, the Complaint alleges in detail that Blueacorn did

substantial business in Texas, to Womply’s great detriment.

The Court also cited the Supreme Court’s recent decision in Ford Motor Co. v. Montana

Eighth Judicial Dist. Ct., 141 S. Ct. 1017 (2021), for the proposition that “‘[t]he plaintiff must

show that the defendant . . . entered a contractual relationship centered’” in the forum state. (Order

at 16 (quoting 141 S. Ct. at 1025) (cleaned up).) That statement, however, does not purport to

establish a rule that a contract must be signed and performed in a forum state. Nor does that

decision—which involved product liability tort claims, not contract claims—otherwise support

such a requirement. Indeed, the “contractual relationships” implicating Blueacorn here were

undoubtedly “centered” in Texas: As alleged in the Complaint, Blueacorn contracted with Womply

to take tens of thousands of loan applications from Womply, send them to Capital Plus in Texas,

receive fees from Texas-based Capital Plus, and send payment to Womply. (Am. Compl. ¶¶ 12,

59, 61–67, 154, 167.) “[P]ut just a bit differently,” as the Supreme Court explained in Ford Motor

Co., there was surely “‘an affiliation between the forum and the underlying controversy,

principally, an activity or an occurrence that takes place in the forum State and is therefore subject

to the State’s regulation.’” 141 S. Ct. at 1025 (quoting Bristol-Myers Squibb Co. v. Super. Ct. of

Cal., San Francisco Cty., 137 S. Ct. 1773, 1780 (2017)) (cleaned up).

Far from requiring “signing and performance,” the Fifth Circuit has long held that, when

considering personal jurisdiction based on a contract, “the place or time of ‘execution,’

-8-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 14 of 24 PageID 1754

‘consummation’ or ‘delivery’ is irrelevant—performance, contemplated or accomplished, is the

touchstone.” Prod. Promotions, Inc. v. Cousteau, 495 F.2d 483, 492 n.11 (5th Cir. 1974) (quoting

Atwood Hatcheries v. Heisdorf & Nelson Farms, 357 F.2d 847, 852 n.14 (5th Cir. 1966))

(emphasis added), abrogated on other grounds by Ins. Corp. of Ireland v. Compagnie des Bauxites

de Guinee, 456 U.S. 694, 702–03 (1982), as stated in Burstein v. State Bar of Cal., 693 F.2d 511,

518 n.12 (5th Cir. 1982). For example, in Dubea v. Simpson, 2009 WL 528258, at *4–5 (E.D. Tex.

Mar. 2, 2009), the court considered whether it had personal jurisdiction based on a contract that

“was in large part negotiated in Louisiana, and was drafted and executed . . . in Louisiana,” but

included “just one act of performance” that occurred “in Texas.” Relying on Cousteau, the court

held that act was sufficient to establish “a prima facie case for jurisdiction” in Texas, which

required only that “‘some performance is to occur there.’” Id. (quoting 495 F.2d at 492 n.11). Here,

the contracts did not result in “just one act of performance” in Texas but undisputedly resulted in

tens of thousands of loans and payments in Texas.

Courts in this Circuit routinely hold that personal jurisdiction lies over contract claims

where, as here, the contract included performance in Texas but was signed elsewhere. See, e.g.,

Polythane Sys., Inc. v. Marina Ventures Int’l, Ltd., 993 F.2d 1201, 1205 (5th Cir. 1993) (affirming

personal jurisdiction of Texas court over Maryland entities where contracts were signed in

Maryland but certain conduct “was performed in Texas”); Texas Capital Bank, N.A. v. Garden

World of Holiday, Inc., 2009 WL 2824700, at *3–5 (E.D. Tex. Aug. 27, 2009) (denying motion to

dismiss for lack of personal jurisdiction where “the contracts were signed in Florida”); Am.

Airlines, Inc. v. Rogerson ATS, 952 F. Supp. 377, 379–82 (N.D. Tex. 1996) (denying motion to

dismiss for lack of personal jurisdiction where the agreement “was signed . . . in Tulsa,

Oklahoma”).

-9-
Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 15 of 24 PageID 1755

2. The Court Overlooked Substantial Allegations Demonstrating Blueacorn’s
Substantial Bilateral Contacts With Texas.

The Court acknowledged that “it would appear that Womply and Blueacorn’s agreements

had a ‘substantial connection with Texas’ because of the large number of applications and the

actual monetary value of these contracts” that were referred to and funded by Capital Plus in Texas.

(Order at 17 (emphasis in original).) This is sufficient to “establish[] a prima facie case” for

personal jurisdiction, which is all that is required at the pleading stage. (Order at 5 (citing Seiferth,

472 F.3d at 270; Pervasive Software Inc. v. Lexware GmbH & Co. KG, 688 F.3d 214, 219–20 (5th

Cir. 2012)).)

The Court concluded, however, that these contacts were substantial only “[i]n the abstract,”

and “were not ‘substantial’ in that the contacts did not solidly connect Blueacorn to Texas,”

because the Court assumed that Blueacorn had only “one-way contacts” that “flowed purely from

Blueacorn to Texas.” (Order at 17.) Respectfully, the Court’s assumption rests on an inference

drawn against Womply; at the pleading stage, Womply is entitled to a reasonable inference that

Blueacorn, as Capital Plus’s Lender Service Provider, had bilateral contacts with Capital Plus in

Texas. (Id. at 5.)

In any event, Womply’s Complaint and additional evidence adequately demonstrated that

Blueacorn’s contacts with Texas were a two-way street. Those allegations included that:

 Blueacorn was created to refer and service “PPP loans” for “two [] lender
counterparties,” one of which is Texas-based Capital Plus (Am. Compl. ¶¶ 9, 46;
APP’X 4–5, 8–9, 22–31, 44–51);5

 Blueacorn is Capital Plus’s “Lender Service Provider”—and is therefore authorized to
“carr[y] out lender functions in originating, disbursing, servicing, or liquidating” loans,

5
All references to “APP’X” refer to the appendix accompanying Womply’s opposition to
Blueacorn’s motion to dismiss (ECF No. 46-1).

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13 C.F.R. § 103.1(d)—which requires communications to and from Capital Plus in
Texas (Am. Compl. ¶¶ 5, 46, 98; APP’X 8–9);

 Blueacorn sent “billion[s] in funding” of PPP loans to Capital Plus in Texas, and
received “more than $500 million in fees” from Capital Plus in Texas (Am. Compl.
¶¶ 5, 9, 47, 50–54; APP’X 10–75);

 Blueacorn and Capital Plus collaborated to negotiate the Agreements with Womply,
including by sending “diligence items” and participating in joint telephone calls (Am.
Compl. ¶ 58; APP’X 84–93, 111–28, 199–200, 212–14);

 Blueacorn communicated with Womply on behalf of Capital Plus—including by
sending Womply “Capital Plus promissory note[s]” and coordinating with Womply
about “customer service inquiries” to Capital Plus—which required communications
to and from Capital Plus in Texas (Am. Compl. ¶¶ 58, 169; APP’X 94–96, 166–86,
201, 219–21); and

 Blueacorn admitted that Capital Plus “undisputedly owes Blueacorn fees in connection
with those [Womply-referred] loans” (ECF No. 31 at 1).

Thus, Blueacorn’s contacts with Texas “flowed into and out of the forum state.” (Order at

17 (citing McGee v. Int’l Life Ins. Co., 355 U.S. 220, 223 (1957)).) And Blueacorn “deliberately

reached out beyond [its] home state” and “entered into a carefully structured” relationship with

Capital Plus with “continuing and wide-reaching contacts” with Texas. (Id. at 16–17 (quoting

Burger King, 471 U.S. at 479–80).) Those allegations must be accepted as true, and are more than

sufficient to support personal jurisdiction. Under Burger King and McGee, “even a single act can

support jurisdiction.” Burger King, 471 U.S. at 475 n.18 (citing McGee, 355 U.S. at 223). Here,

there are numerous detailed allegations that Blueacorn’s contacts with Texas under the contracts

were pervasive.

B. The Complaint Alleges That Womply’s Tort Claims Against Blueacorn Have
A Substantial Connection To Texas.

The Court correctly held that “all the claims arise from the same forum contacts,” and

“when multiple claims arise from the same contacts, specific jurisdiction does not need to be

established for each claim.” (Order at 13 (quoting Sedillo ex rel. Filo & Fran Sedillo Revocable

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Tr. v. Team Techs., Inc., 2020 WL 6870711, at *3 (N.D. Tex. Nov. 23, 2020)).) Accordingly, the

Court has personal jurisdiction over Blueacorn with respect to Womply’s contract and tort claims

for the reasons discussed above.

The Court nonetheless analyzed “Womply’s tort claims” separately, holding correctly that

it must examine “the ‘effects’ of the defendant’s conduct when analyzing specific personal

jurisdiction.” (Id. at 14–15 (quoting Calder v. Jones, 465 U.S. 783, 788–89 (1984)).) The Court

recognized that the Complaint alleged: (i) “that Blueacorn’s CEO induced Womply’s CEO to enter

into the Agreements, where Womply provided services to Capital Plus in Texas”; (ii) that “[a]fter

entering into the agreements, Womply referred 86,521 PPP loans to Blueacorn and then referred

all of those loans to Capital Plus in Texas”; and (iii) “[p]ursuant to the agreements, Capital Plus

funded 86,521 PPP loans worth over $950 million and received $186,882,948 in Lender

Processing Fees for Womply-referred loans.” (Id. at 4, 11 (cleaned up).) Those facts are more than

sufficient to make a prima facie showing that Blueacorn’s misconduct had jurisdictionally

significant effects in Texas.

The Court’s Order, however, imposed an additional requirement that Womply must

“suffer[] the alleged injuries” in Texas, or that Blueacorn’s misconduct must “occur[] in Texas”

or be “directed toward Texas.” (Id. at 15 (cleaned up).) Respectfully, that is wrong. Neither the

Supreme Court nor the Fifth Circuit requires the harm to be felt in, have occurred in, or be directed

to the forum state to establish personal jurisdiction. All that is required is that the alleged

misconduct have the “‘foreseeable’ effect of ‘causing business activity in the forum state.’” Cent.

Freight Lines Inc. v. APA Transp. Corp., 322 F.3d 376, 382 (5th Cir. 2003) (quoting Miss.

Interstate Express, Inc. v. Transpo, Inc., 681 F.2d 1003, 1007 (5th Cir. 1982)) (reversing dismissal

for lack of personal jurisdiction); see Calder, 465 U.S. at 788–89 (“Jurisdiction over petitioners is

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therefore proper in California based on the ‘effects’ of their Florida conduct in California.”); Def.

Distributed v. Grewal, 971 F.3d 485, 490–97 (5th Cir. 2020) (finding personal jurisdiction because

“[t]he foreseeable effects of a tort” “includ[ed] Texas residents”) (quoting Wien Air Alaska, Inc.

v. Brandt, 195 F.3d 208, 211 (5th Cir. 1999)). Womply alleged that Blueacorn’s conduct had the

foreseeable effect of causing Capital Plus’s business activity in Texas. Moreover, the Fifth Circuit

has long recognized that “[e]ven an act done outside the state that has consequences or effects

within the state will suffice as a basis for jurisdiction in a suit arising from those consequences if

the effects are seriously harmful and were intended or highly likely to follow from the nonresident

defendant’s conduct.” Guidry v. U.S. Tobacco Co., Inc., 188 F.3d 619, 628 (5th Cir. 1999). That

is precisely what the Complaint alleges here. Wherever Blueacorn’s tortious conduct may have

occurred, the consequences of those actions had the effect of impermissibly enriching a Texas-

based business by tens of millions of dollars at Womply’s expense.

The Court’s reliance on Danziger & De Llano, L.L.P. v. Morgan Verkamp, L.L.C., 24 F.4th

491 (5th Cir. 2022), is misplaced. There, “‘[t]he only act or omission . . . plausibly connected to

Texas’ was an unsolicited reply to an email by the defendant.” (Order at 14 (quoting Danziger, 24

F.4th at 497).) Here, by contrast, Blueacorn coordinated its fraudulent conduct with Texas-based

Capital Plus, resulting in tens of thousands of transactions generating more than $950 million of

loans and more than $187 million in government fees flowing to Texas, which “meaningfully

connect[s] [Blueacorn] to Texas.” Danziger, at 498 (emphasis in original). Indeed, the Court held

that the Complaint “adequately pleaded” a “conspiracy between Blueacorn, Calhoun, and the

Capital Plus Defendants to commit unlawful and tortious acts against Womply that resulted in

$76 million in damages.” (May 11 Order at 28 (citing Am. Compl. ¶¶ 187–90).) Blueacorn’s

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conspiracy with Capital Plus, which is undisputedly alleged to have engaged in misconduct in

Texas, further supports the Court’s exercise of personal jurisdiction.6

In sum, the allegations in Womply’s Complaint are more than sufficient to survive a motion

to dismiss.

II. ALTERNATIVELY, THE COURT SHOULD SET ASIDE ITS ORDER AND
PERMIT WOMPLY TO REPLEAD ITS CLAIMS AGAINST BLUEACORN IN ITS
SECOND AMENDED COMPLAINT.

In its May 11, 2022 Order granting in part and denying in part Capital Plus’s motion to

dismiss, the Court held that because “this is the Court’s first opportunity to assess the sufficiency

of Womply’s allegations, the Court deems it appropriate to provide it one chance to amend its

pleadings in light of the deficiencies noted in this Court.” (May 11 Order at 28 (citing Fed. R. Civ.

P. 15(a)(2)).) Should the Court deny reconsideration on the basis of the currently pending First

Amended Complaint, Womply respectfully requests leave to include in its forthcoming Second

Amended Complaint allegations addressing the Court’s concerns regarding personal jurisdiction.

Because the Court has already granted leave to amend, including jurisdictional allegations against

Blueacorn will promote judicial economy and is particularly appropriate here because the Court

dismissed Womply’s claims against Blueacorn “without prejudice.” (Order at 1, 18); see Stewart

v. Atherio, Inc., 2018 WL 2047997, at *2 (N.D. Tex. May 2, 2018) (Boyle, J.) (“Unless there exists

6
Courts are divided over whether this conspiracy, standing alone, is sufficient to allege personal
jurisdiction, and Womply reserves the right to raise this issue on appeal. Compare, e.g., Unspam
Techs, Inc. v. Chernuk, 716 F.3d 322, 329 (4th Cir. 2013) (recognizing “conspiracy theory of
jurisdiction”), and J & M Assocs., Inc. v. Romero, 488 F. App’x 373, 375 (11th Cir. 2012) (same)
(citing Ex Parte Reindel, 963 So.2d 614, 622–24 (Ala. 2007)), with Nat’l Indus. Sand Assoc. v.
Gibson, 897 S.W.2d 769, 773 (Tex. 1995) (rejecting “[c]onspiracy as an independent basis for
jurisdiction”).

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a substantial reason for denying leave to amend, the district court should permit the filing of a

proposed amendment.”) (internal quotation marks omitted) (granting leave to amend).

In the SAC, Womply seeks to specifically addresses the Court’s concerns that Blueacorn

did not have “a substantial connection with Texas,” Blueacorn’s contacts with Texas ran “one-

way,” and Blueacorn’s conduct did not “meaningfully connect” it to Texas. (Order at 14–17.)7 For

example, the SAC will allege, based in part on analysis of Capital Plus’s parent corporation’s

financial disclosures, that Texas-based Capital Plus paid $606.4 million in fees to the loan servicer

provider Blueacorn related to Capital Plus’s participation in the PPP loan program.

The SAC will further detail how Blueacorn and Capital Plus negotiated the Agreements

with Womply together, including specific allegations that Blueacorn’s CEO communicated

directly with Capital Plus about the proposed Agreements; that Blueacorn and Capital Plus had

joint “diligence items” and calls with Womply about the proposed Agreements; and that Blueacorn

and Womply coordinated to provide Capital Plus with access to Womply’s Technology Platform.

The SAC will also describe specific emails and chats showing how Blueacorn coordinated closely

with Capital Plus to implement the Agreements by reviewing, processing, and funding the

Womply-referred loans using the Womply Technology Platform. For example, Blueacorn told

Womply that “*we = Cap Plus.” And Blueacorn continues to work with Capital Plus regarding

forgiveness of the Womply-referred PPP loans.

7
The Court set a June 10, 2022 deadline for Womply to amend its claims against Capital Plus.
(May 11 Order at 28–29.) Because Womply seeks to include additional allegations against both
Blueacorn and Capital Plus in the SAC, which is not due for another 25 days, Womply is not yet
able to “attach a copy of the proposed amended pleading as an exhibit to the motion.” Local Civ.
R. 15.1(a). Womply can provide a proposed SAC showing the additional allegations against
Blueacorn at the Court’s request.

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Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 21 of 24 PageID 1761

The SAC will further allege that Blueacorn marketed its services in Texas, provided

services to PPP loan applicants in Texas, and facilitated PPP loans to borrowers in Texas that were

approved by the SBA and funded by a lender. The SAC will identify specific Blueacorn

advertisements that appeared in Texas and specific applicants in Texas who applied for PPP loans

through Blueacorn during the relevant time period for this action. As the Supreme Court recently

confirmed, “specific jurisdiction attaches” where, as here, a company “actively seeks to serve the

market” in the forum State, including by “advertising, selling, and servicing” products in that State.

Ford, 141 S. Ct. at 1022, 1026–27.

III. IN THE ALTERNATIVE, THE COURT SHOULD DIRECT ENTRY OF FINAL
JUDGMENT AS TO BLUEACORN UNDER FED. R. CIV. P. 54(b).

Should the Court decline to reconsider or set aside its Order or decline to permit Womply

to replead its claims against Blueacorn, Womply respectfully requests that the Court “direct entry

of a final judgment” as to Blueacorn. Fed. R. Civ. P. 54(b) (“[T]he court may direct entry of a final

judgment as to one or more, but fewer than all, claims or parties . . . .”). Rule 54(b) certification

will enable Womply to take an immediate appeal, which will promote efficiency “because the

issue of personal jurisdiction is plainly separable from the remaining claims against the other

defendants.” Animale Grp., Inc. v. Sunny’s Perfume, Inc., 2007 WL 2010476, at *2 (S.D. Tex. July

5, 2007) (cleaned up) (granting Rule 54(b) certification). Womply will otherwise be forced “to

choose between deferring its claims against [Blueacorn] to be resolved at a much later date, either

in this Court or in some other district, or withdrawing its appeal, acquiescing in this Court’s

decision on personal jurisdiction, and proceeding simultaneously in two courts.” Id.

Courts in this Circuit often enter “a final appealable order” under Rule 54(b) when

dismissing claims against certain parties “for lack of personal jurisdiction.” Avdeef v. Google, Inc.,

678 F. App’x 239, 239 (5th Cir. 2017); see, e.g., Cooper Tire & Rubber Co. v. Farese, 423 F.3d

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Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 22 of 24 PageID 1762

446, 453 (5th Cir. 2005) (“Cooper Tire’s claims against Turner and his firm were dismissed for

lack of personal jurisdiction, the dismissal being certified under Federal Rule of Civil Procedure

54(b) as a partial final judgment.”); Hoffman v. L&M Arts, 774 F. Supp. 2d 826, 849 (N.D. Tex.

2011) (“By Rule 54(b) final judgment filed today, Hoffman’s action against Meyer is dismissed

without prejudice for lack of personal jurisdiction.”).8 As one court noted, “[o]ne would be hard-

pressed to find a decision in which a court denied Rule 54(b) certification after dismissing a party

for lack of personal jurisdiction.” Animale, 2007 WL 2010476, at *1.9

CONCLUSION AND PRAYER FOR RELIEF

For the foregoing reasons, Womply respectfully requests that the Court (i) reconsider and

set aside its Order based on the current Complaint; (ii) alternatively, set aside its Order and

reconsider personal jurisdiction over Blueacorn based on the SAC; or (iii) in the alternative, direct

entry of final, appealable judgment as to Blueacorn under Rule 54(b).

8
See also Anderson v. T&D Machine Handling Inc., 85 F.3d 625 (5th Cir. 1996) (“[T]he district
court granted T&D’s motion and entered final judgment dismissing the claims against SBH for
lack of personal jurisdiction.”) (citing Fed. R. Civ. P. 54(b)); Shippitsa Ltd. v. Slack, 2019 WL
277613, at *1 (N.D. Tex. Jan. 22, 2019) (dismissing claims against certain defendants “for lack of
personal jurisdiction” and “enter[ing] final judgment under Rule 54(b)”); Freedom Path, Inc. v.
Lerner, 2015 WL 770254, at *14 (N.D. Tex. Feb. 24, 2015) (same); Franklin v. N., 2012 WL
12878159, at *2 n.2 (N.D. Tex. July 6, 2012) (same).
9
Alternatively, Womply requests that the Court certify its Order for interlocutory appeal pursuant
to 28 U.S.C. § 1292(b) because (i) personal jurisdiction “involves a controlling question of law,”
(ii) there is “substantial ground for difference of opinion” for the reasons set forth above, and
(iii) “immediate appeal from the order may materially advance the ultimate termination of the
litigation” by avoiding the need for Womply to re-file this action in a different court.

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Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 23 of 24 PageID 1763

Dated: May 16, 2022 Respectfully submitted,

Of Counsel: By: /s/ Jason P. Bloom
Nina Cortell
Willkie Farr & Gallagher LLP Texas Bar No. 04844500
Jason P. Bloom
Alexander L. Cheney (admitted pro hac vice) Texas Bar No. 24045511
One Front Street Haynes and Boone, LLP
San Francisco, CA 94111 2323 Victory Avenue, Suite 700
(415) 858-7400 Dallas, TX 75219
acheney@willkie.com (214) 651-5000
nina.cortell@haynesboone.com
Mark T. Stancil (admitted pro hac vice) jason.bloom@haynesboone.com
Joshua S. Levy (admitted pro hac vice)
1875 K Street, N.W. Attorneys for Plaintiff Oto Analytics, Inc. d/b/a
Washington, D.C. 20006 Womply
(202) 303-1000
mstancil@willkie.com
jlevy@willkie.com

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Case 3:21-cv-02636-B Document 88 Filed 05/16/22 Page 24 of 24 PageID 1764

CERTIFICATE OF CONFERENCE

On May 10, 2022, I conferred with Michael Levy and Christopher Egleson, counsel for

Blueacorn, by email regarding the relief requested herein. Counsel for Blueacorn stated that they

are opposed to Womply’s motion for reconsideration and for leave to amend the complaint, and

would take a position regarding Rule 54(b) certification after reviewing this motion.

/s/ Joshua S. Levy
Joshua S. Levy

CERTIFICATE OF SERVICE

This is to certify that a true and correct copy of the foregoing document has been served

on the following counsel of record, this 16th day of May 2022, by using the electronic case filing

system of the United States District Court for the Northern District of Texas:

Penny P. Reid, preid@sidley.com
Claire Homsher, chomsher@sidley.com
Michael A. Levy, mlevy@sidley.com
Christopher M. Egleson, cegleson@sidley.com
Katelin Everson, keverson@sidley.com
Terrell W. Oxford, toxford@susmangodfrey.com
Harry P. Susman, hsusman@susmangodfrey.com
Megan Elise Griffith, mgriffith@susmangodfrey.com

/s/ Jason P. Bloom
Jason P. Bloom

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