Opinion
EP-02-CA-0200-DB
March 5, 2003
MEMORANDUM OPINION AND ORDER
On this day, the Court considered two motions: an "Amended Motion to Dismiss" by Defendant A.C., Inc. ("A.C.") and a "Special and Limited Appearance and Motion to Dismiss" by County Concrete Construction Company, Inc. ("County Concrete") (collectively "Defendants"), filed in the above-captioned cause on July 16, 2002 and June 24, 2002, respectively. Plaintiffs Francisco Flores, Victor Galvan, Jose D. Martinez, Juventino Medina, Pablo Murua, Francisco Paez, Francisco Rincon, and Roberto Rodriguez (collectively "Plaintiffs") filed a Response on September 18, 2002, to which Defendants filed separate Replies on September 25 and 26, 2002.
After due consideration, the Court is of the opinion that A.C. and County Concrete's Motions to Dismiss should be granted for the reasons that follow.
FACTS AND PROCEDURAL BACKGROUND
Plaintiffs, residents of Texas, brought this action pursuant to the Migrant and Seasonal Agricultural Workers Protection Act ("AWPA"), 29 U.S.C. § 1801 et seq, the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq, Maine state wage payment laws, 26 M.R.S.A. §§ 621— 634, and for breach of contract, fraud, and negligent misrepresentation against Defendants A.C., County Concrete, and Francisco Velez ("Velez"), doing business as Velez Digging Contractors. Plaintiffs are migrant farm workers whose permanent place of residence is El Paso County, Texas. A.C., a company engaged in the seafood processing business, is located in Beals, Maine. County Concrete is a construction company based in Columbia Falls, Maine. Velez, a farm labor contractor, is also based in Maine. In the spring of 2000, A.C. and County Concrete employed Plaintiffs to perform agricultural labor for them in Maine.
According to the allegations set forth in Plaintiffs' Complaint, Defendants and their agents recruited Plaintiffs from the Opportunity Center, a homeless shelter in El Paso, Texas, to work in Maine either at a sea cucumber processing facility owned by A.C. or clearing pine trees for County Concrete. Plaintiffs claim that they were promised jobs processing sea cucumbers on a by-the-pound piece rate basis. Plaintiffs were allegedly told that if they did not want to work on a piece rate basis, they could work at an hourly rate. According to some of the Plaintiffs, they were told that if they did not like sea cucumber processing work, they could work clearing pine trees. Plaintiffs also allege that they were promised good housing and food. Plaintiffs claim that they relied on these representations when they accepted employment with Defendants.
When the Plaintiffs arrived by bus in Bangor, Maine, Plaintiffs Galvan, Murua, Paez, Rincon and Rodriguez, who had been recruited in Texas to work in the sea cucumber processing facility, were instead taken to Columbia Falls, Maine to clear pine trees for County Concrete. After they began work, they discovered that they would be paid less than what they had been promised in Texas. Plaintiffs Flores, Rincon, Martinez and Medina were taken to Beals Island, Maine to work for A.C. in its sea cucumber processing facility. When they began work, these Plaintiffs discovered that there was not enough product to process to earn the piece rates they had been promised in Texas and they were not given the option of working on an hourly basis.
Plaintiffs also allege that their housing accommodations while working for A.C. and County Concrete were unsanitary and over-crowded, and that the vehicles used to transport Plaintiffs to their workplace were dangerous and sub-standard. Finally, according to Plaintiffs, when they complained to a manager about their working conditions and pay, they were taken to the bus station in Bangor, Maine and dropped off without their last paycheck and without bus tickets or money. Plaintiffs Flores, Martinez and Rincon were picked up from the bus station by Velez to work clearing pines for County Concrete.
Plaintiffs raise five claims under the AWPA, alleging that each Defendant violated (1) 29 U.S.C. § 1821(a) by failing to disclose in writing the terms and conditions of employment at the time the Plaintiffs were recruited; (2) 29 U.S.C. § 1821(f) by knowingly providing false and misleading information regarding the terms and conditions of employment; (3) 29 U.S.C. § 1822(c) by failing to comply with the terms of the working arrangement; (4) 29 U.S.C. § 1823(a) by failing to ensure that the housing provided to the Plaintiffs complied with the applicable substantive federal and state health and safety standards; (5) 29 U.S.C. § 1823(b) by housing the Plaintiffs without first securing the certification that the housing met minimum safety and health standards; (6) 29 U.S.C. § 1822(a) by failing to pay each Plaintiff the wages owed; and (6) 29 U.S.C. § 1821(d)(2) by not providing wage receipts to each Plaintiff. Plaintiffs further allege that Defendants County Concrete and Velez further intentionally violated the rights of Plaintiffs Galvan, Murua, Paez, Rincon and Rodriguez (1) by transporting Plaintiffs in substandard vehicles in violation of 29 U.S.C. § 1841 and (2) by failing to provide Plaintiffs Galvan, Murua, Paez, Rincon and Rodriguez with toilets, handwashing facilities and drinking water in the field as required by 29 C.F.R. § 1928.110 et seq. Furthermore, Plaintiffs raise a claim under 29 U.S.C. § 206(a)(1) of the FLSA for failure to pay Plaintiffs the federally-mandated minimum wage per hour during each workweek. Finally, Plaintiffs raise state law claims of breach of contract, fraud, including fraudulent inducement and misrepresentation to enter into the contract, and negligent misrepresentation.
DISCUSSION
A.C. and County Concrete ask the Court to dismiss this cause for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. In support, Defendants argues that Plaintiffs have neither established that Defendants have minimum contacts with Texas sufficient to confer on this Court personal jurisdiction over them, nor that this Court's exercise of jurisdiction over Defendants comports with traditional notions of fair play and substantial justice. Velez has not raised a challenge to this Court's exercise of personal jurisdiction over him.
In addition to its challenge to personal jurisdiction, Defendant A.C. raises two alternative arguments in its Motion. Because the determination of personal jurisdiction is dispositive of the Motion, the Court will not address A.C.'s alternative arguments.
In general, a plaintiff opposing a motion to dismiss for lack of personal jurisdiction bears the burden of establishing jurisdiction. See Bullion v. Gillespie, 895 F.2d 213, 216-17 (5th Cir. 1990). Where a court rules on such motion without holding an evidentiary hearing, the court must accept as true all uncontroverted allegations in the complaint and resolve all factual conflicts presented by the parties' affidavits in the plaintiff's favor. Id. at 217. Thus, absent a hearing, the plaintiff need only establish a prima facie case for personal jurisdiction. Id.
Because AWPA is silent with regard to personal jurisdiction, this Court may exercise personal jurisdiction over only those defendants who are subject to the jurisdiction of Texas courts. Aviles v. Kunkle, 978 F.2d 201, 203-04 (5th Cir. 1992). To determine whether a nonresident defendant is subject to jurisdiction, the Court must first determine whether the Texas long-arm statute permits the exercise of jurisdiction over that defendant. Ham v. La Cienega Music Co., 4 F.3d 413, 415 (5th Cir. 1993). The Court must then determine whether such exercise comports with due process. Id.
Due process requires (1) that the defendant have established "minimum contacts" with the forum state; and (2) that the exercise of personal jurisdiction does not offend "traditional notions of fair play and substantial justice." Ham, 4 F.3d at 415 (citing Asahi Metal Indus. v. Superior Court, 480 U.S. 102, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987), and Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985)). To establish "minimum contacts" with a forum state, a nonresident defendant "must have purposefully availed himself of the benefits and protections of the forum state. . . ." Marathon Oil Co. v. A.G. Ruhagas, 182 F.3d 291, 294-95 (5th Cir. 1999) (quoting Wilson v. Belin, 20 F.3d 644, 647 (5th Cir. 1994)).
"The `minimum contacts' prong can be subdivided into contacts that give rise to `specific' personal jurisdiction and those that give rise to `general' personal jurisdiction." Marathon Oil Co., 182 F.3d at 295 (citing Gundle Lining Constr. Corp. v. Adams County Asphalt, Inc., 85 F.3d 201 (5th Cir. 1996)). Specific jurisdiction requires some direct relationship — a nexus — between the purposeful contacts and the litigation. Id. (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)). General jurisdiction, on the other hand, relates to contacts, even if unrelated to the cause of action, which "are continuous, systematic, and substantial." Id. (citing Helicopteros, 466 U.S. at 415, 104 S.Ct. at 1868 and Wilson, 20 F.3d at 649).
Plaintiffs do not suggest that the Court can exercise general jurisdiction over Defendants. Hence, the applicable inquiry is whether the Court may exercise specific jurisdiction. In order to demonstrate specific jurisdiction, Plaintiffs must show that Defendants have "purposefully directed" their activities at the residents of the forum. Burger King Corp., 471 U.S. at 472, 105 S.Ct. at 2182. Secondly, plaintiffs must show the litigation resulted from the alleged injuries that "arise out of or relate to" a defendant's activities directed at the forum. Id. (citing Helicopteros, 466 U.S. at 414, 104 S.Ct. at 1872). Finally, the Court must examine the relationship between the defendants, the forum, and the litigation to determine whether maintaining the suit offends "traditional conceptions of fair play and substantial justice." Id. at 464, 476-77, 105 S.Ct. at 2177, 2184 (citing Int'l Shoe Co. v. Washington, 326 U.S. 310, 320, 66 S.Ct. 154, 160, 90 L.Ed. 95 (1945)).
It is not the number, but the quality and nature of the non-resident defendant's contacts with the forum that is important. See D.J. Investments, Inc. v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542, 547-48 (5th Cir. 1985) (quoting Prejean v. Sonatrach, Inc., 652 F.2d 1260, 1268 (5th Cir. 1981)). Even a single act by the defendant directed at the forum can be enough to confer personal jurisdiction, if the cause of action arises out of that act. Burger King Corp., 471 U.S. at 475 n. 18, 105 S.Ct. at 2184 n. 18; see also Ruston Gas Turbines, Inc. v. Donaldson Co., 9 F.3d 415, 419 (5th Cir. 1993). However, a defendant should not be subject to the jurisdiction of a foreign court based on "random," "fortuitous," or "attenuated" contacts. Burger King Corp., 471 U.S. at 475-76, 105 S.Ct. at 2183-84. The defendant's activities, whether they consist of direct acts within the forum or conduct outside the forum, should be such that he or she reasonably should anticipate being haled into court there. See World-Wide Volkswagen v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980). The defendant's acts must be substantial enough to give clear notice that he or she would be subject to suit in the forum state. Id. However, the unilateral activities of one claiming some relationship with the non-resident defendant is not enough to satisfy the minimum contacts requirement. Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239-40, 2 L.Ed.2d 1283 (1958).
I. Personal Jurisdiction Over A.C. A. Background
In November 1999, Velez met with Albert Carver ("Carver"), the president of A.C., at which time Velez agreed to provide laborers for Carver's sea cucumber processing business in Maine. Carver told Velez that he would need fifteen or twenty laborers. Velez agreed to continue providing laborers to Carver's business as long as Carver had a need for them. When Carver asked Velez where he would obtain the laborers, Velez told him that he would bring them from Puerto Rico. Velez and Carver agreed on the price per pound of processed sea cucumber meat to be paid to Velez, out of which Velez would pay a piece rate to the workers he recruited. They also negotiated the piece rate the laborers would be paid. While Velez believed that he was not free to change the piece rates once he and Carver agreed upon them (at least without consulting Carver first), he stated that he was free to walk away if he did not get the rate that he needed to cover his expenses as a labor contractor.
Velez and Carver also agreed that any worker who, after two weeks, did not process enough sea cucumbers to earn more per hour than minimum wage would be transferred to other employment, such as landscaping or clearing pine trees for County Concrete. Velez not only furnished laborers to A.C., he also supplied them to other businesses in Maine and on the East Coast, and Carver was aware of that fact. When a worker did not produce enough sea cucumber meat to earn minimum wage, Velez would be contacted by Carver or a supervisor at A.C. and instructed to transfer the worker to other employment. According to Velez, this arrangement was communicated to the Plaintiffs when they were recruited.
Because Velez did not have a license to house laborers, Carver agreed to house them on the second story of the A.C. facility and charge twenty-five dollars per week. According to Velez, all of the terms and conditions agreed upon in November 1999 remained in effect until June 2000, when there was a seasonal shut-down at A.C.
Velez began providing workers to A.C. beginning in December 1999. To initiate production, Velez supplied a handful of men from a pool of laborers he was already providing to other employers in Connecticut and New Jersey. Velez then recruited workers from Puerto Rico in March 2000. Carver was aware that Velez intended to go to Puerto Rico and recruit workers for A.C. Velez consulted Carver about the trip and Carver agreed that it was necessary. However, Carver did not finance any of Velez's expenses for the trip.
At the peak of production in February 2000, A.C. employed as many as forty-two people. However, Velez continued to provide A.C. with workers as needed. Angel Cisneros, a driver employed by Velez to transport workers in Maine and Connecticut, told Velez that he planned to travel to Texas or Mexico in March or April 2000. According to Velez, the purpose of Cisneros' trip was to convince his wife and children to return to the northeast to live with Cisneros. Before he departed, Cisneros mentioned to Velez that he would also try to find some workers while he was in Texas. Cisneros did not speak with Carver or anyone else from A.C. before leaving for Texas.
Approximately two weeks after leaving Maine, Cisneros made his way to the Opportunity Center in El Paso where Plaintiffs were residing and telephoned Velez in Maine to inform him that laborers were available. Velez told Cisneros that he needed workers and to make sure they had proper work authorization papers. He also instructed Cisneros to explain the piece rates and wages to the workers, as well as the rental price for the housing. Velez then contacted Carver over the telephone and informed him that he had a "contact" in Texas and planned to recruit workers and bring them to Maine. Carver agreed that he could use the workers and told Velez to make sure that they had proper work authorization.
While Cisneros was still in Texas, Velez sent a videotape to him to be shown to the men at the Opportunity Center. The tape provided an overview of sea cucumber processing work at the A.C. facility. According to Velez, Carver was not involved in the production of the videotape, nor did he provide the tape to Velez. Plaintiffs Paez and Flores stated that they were shown the videotape and strongly encouraged by one of the shelter employees to sign up for work in Maine. The employee told the men that they could make up to two-hundred dollars a day and work many hours. Paez claims he signed some papers in the offices of the Opportunity Center, but was not sure what they were.
Velez sent money to Cisneros to cover the cost of Plaintiffs' bus tickets to Maine, as well as cash advances for food. Approximately twenty workers, including all of the Plaintiffs, were taken by Cisneros to the bus station in El Paso, where they began their journey to Maine. According to Velez, he did not receive any funds from Carver or anyone else at A.C. to cover the cost of the bus tickets or food. Plaintiffs arrived in Maine in April or May 2000 and according to Velez, signed paperwork, including an application and other hiring documents, when they arrived at Velez's office.
B. The Texas Long-Arm Statute
Plaintiffs urge this Court to assert jurisdiction over A.C. pursuant to the Texas long-arm statute. The Texas long-arm statute authorizes the exercise of jurisdiction over nonresidents "doing business" in Texas. TEX. CIV. PRAC. REM. CODE ANN. §§ 17.041-17.045 (Vernon 1997 Supp. 2002). A nonresident does business in Texas if it: (1) contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part in this state; (2) commits a tort in whole or in part in this state; or (3) recruits Texas residents, directly or through an intermediary located in this state, for employment inside or outside this state. TEX. CIV. PRAC. REM. CODE ANN. § 17.042 (Vernon 1997). Plaintiffs argue that personal jurisdiction exists under subsections (2) and (3) of the Texas long-arm statute. Plaintiffs claim jurisdiction is proper under subsection (2) in that A.C. committed a tort in Texas by making misrepresentations to Plaintiffs when they were recruited. Plaintiffs also argue that personal jurisdiction over A.C. is proper under subsection (3) because Velez and Cisneros acted as intermediaries for A.C. when they recruited Plaintiffs for employment outside the state.
However, the Court may properly avoid these specific statutory inquiries and proceed directly to the constitutional analysis. The Texas Supreme Court has interpreted the "broad language" of the long-arm statute as permitting an expansive reach, limited only by federal constitutional requirements of due process. Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex. 1990); see also Kelley v. Syria Shell Petroleum Dev. B.V., 213 F.3d 841, 854 (5th Cir. 2000). Where the state long-arm statute reaches to the federal limits of due process, the traditional two-part analysis for personal jurisdiction collapses into the single question of whether federal constitutional standards have been met. Ruston Gas Turbines, Inc., 9 F.3d at 418; see also Holt Oil Gas Corp. v. Harvey, 801 F.2d 773, 777 (5th Cir. 1986), cert. denied, 481 U.S. 1015, 107 S.Ct. 1892, 95 L.Ed.2d 499 (1987) ("When a state's long-arm statute is coextensive with the outer limits of due process, the court's attention properly turns to whether the exercise of personal jurisdiction comports with federal constitutional standards."). The Supreme Court reasoned that this expansive construction was desirable because "it allows the courts to focus on the constitutional limitations of due process rather than to engage in technical and abstruse attempts to consistently define `doing business.'" U-Anchor Advertising, Inc. v. Bert, 553 S.W.2d 762 (Tex. 1977), cert. denied, 434 U.S. 1063, 98 S.Ct. 1235, 55 L.Ed.2d 763 (1978).
C. Minimum Contacts (1) Agency and Imputed Contacts
As an initial matter, the Court notes that A.C.'s actions alone amount to no direct contacts with Texas. Carver states that he did not travel to Texas, did not direct anyone else to travel to Texas, did not send money or employment materials or any other written communications into Texas, and did not initiate any calls to Texas. However, Plaintiffs may potentially establish the requisite minimum contacts with Texas by somehow imputing the activities of Velez or Cisneros to Carver and A.C. Accordingly, the Court first considers whether Velez and Cisneros were in any sort of agency relationship with A.C.
For purposes of personal jurisdiction, the actions of an agent may be attributed to the principal. See Burger King Corp., 471 U.S. at 480 n. 22, 105 S.Ct. at 2174 (stating that commercial activities carried out on a party's behalf "may sometimes be ascribed to the party"). An agent is one who is authorized by another to transact business or manage some affair for him. Jorgenson v. Stuart Place Water Supply Corp., 676 S.W.2d 191 (Tex.App.-Corpus Christi 1984, no writ). The question of agency is one of fact. Steelstone Indus., Inc. v. N. Ridge Ltd. P'ship, 735 A.2d 980, 983 (Me. 1999); Jorgenson, 676 S.W.2d at 191. An agency relationship cannot be presumed to exist. Ross v. Texas One P'ship, 796 S.W.2d 206, 209 (Tex.App.-Dallas 1990), writ denied per curiam 806 S.W.2d 222 (Tex. 1991). The test for determining agency is a finding that the principal has both the right to assign the agent's task and the right to control the means and details by which the agent will accomplish the task. See Lyons v. Lindsey Morden Claims Mgmt, Inc., 985 S.W.2d 86, 90 (Tex.App.-El Paso 1998, no pet.). Even though one acts for and on behalf of another, if he is not under that other person's control, the agency relationship does not exist. See Page v. Boone's Transp., Ltd., 710 A.2d 256, 257 (Me. 1998); Daily Intern. Sales Corp. v. Eastman Whipstock Corp., Inc., 662 S.W.2d 60, 64 (Tex.App.-Houston [1st Dist.] 1983, no writ). The right to control a person in the details of the work is the essential inquiry in determining whether a relationship is that of agency or independent contractor. Daily Intern. Sales Corp., 662 S.W.2d at 64. An independent contractor is one who, in the pursuit of an independent business, undertakes a specific job for another person, using his own means and methods, without submitting himself to the other's control regarding details of the job. Pitchfork Land and Cattle Co. v. King, 162 Tex. 331, 338, 346 S.W.2d 598, 602-03 (1961). Whether a principal-agent relationship exists may be based on a review of the agreement between the parties, their words, and their conduct. Ross, 796 S.W.2d at 210.
The Court has reviewed the relevant cases in Texas and Maine state courts applying the common law principles of agency and finds that they are the same in both jurisdictions. Accordingly, the Court need not engage in an extensive choice of law analysis. However, for the sake of completeness, the Court relies on case law from Texas and Maine.
The mere fact that Carver and Velez reached an agreement whereby Velez would provide laborers to the company does not establish that an agency relation exists. As part of his agreement with Carver, Velez was assigned the task of locating and recruiting laborers for A.C. However, Carver did not instruct Velez on how or where to recruit workers. Instead, the evidence supports a finding that Velez carried out his day to day recruitment efforts with little or no supervision or interference from Carver. Moreover, Velez, doing business as Velez Digging Contractors, also supplied laborers to several employers in the northeastern United States using his owns means and methods. Velez regularly transferred laborers in his own vehicles from one workplace to another to meet each employer's specific labor needs. He also handled the payroll for all of his employees and carried worker's compensation insurance.
The Court also relies on Velez's testimony that Carver was aware that Velez planned to travel to Puerto Rico to recruit workers, but did not need his approval for the trip. Velez paid for his own travel expenses, as well as those of the workers he recruited. Velez did not receive any funds from Carver to do so. Nor did Carver advance funds to Velez to cover the cost of Plaintiffs' bus tickets or food in the instant cause. Velez also created the videotape that he sent to Cisneros in Texas. Carver was not involved in its production. In reviewing the relationship between A.C. and Velez, the evidence shows that Carver did not control Velez in the details of his recruitment efforts for A.C., and thus Velez operated as an independent contractor, not as an agent. Because Plaintiffs have failed to establish the existence of an agency relationship, the activities of Velez and Cisneros therefore may not be imputed to A.C. for purposes of personal jurisdiction.
(2) Ratification
Plaintiffs also argue that even if A.C. did not intend that Velez and Cisneros would be recruiting Plaintiffs in Texas, A.C. is liable for those acts under a theory of ratification. Plaintiffs argue that personal jurisdiction over A.C. is appropriate because Carver ratified Velez's and Cisneros' recruiting efforts by agreeing to employ Plaintiffs while they were still in Texas and later using their labor when they arrived in Maine. Plaintiffs claim that Carver's ratification of those actions creates an agency relationship and satisfies the minimum contacts analysis.
Ratification is the affirmance by a person of a prior act which when performed did not bind him, but which was professedly done on his account, whereby the act is given effect as if originally authorized by him. RESTATEMENT (SECOND) OF AGENCY § 82 (1958). Ratification, in this context, is not a form of authorization, but a legal concept in agency law describing the relations between parties after affirmance by a person of a transaction done or purported to be done for him. RESTATEMENT (SECOND) OF AGENCY § 82 cmt. a, b (1958). A ratification will lie when the individual for whom an act was done retains the benefits of the transaction after acquiring full knowledge of the transaction. See Perkins v. Philbrick, 443 A.2d 73, 75 (Me. 1982); Land Title Co. of Dallas v. F.M. Stigler, Inc., 609 S.W.2d 754, 756 (Tex. 1980). However, ratification will not imply an agency relationship where none existed before. See Disney Enter., Inc. v. Esprit Fin., Inc., 981 S.W.2d 25, 30 (Tex.App.-San Antonio 1998, pet. filed); Southwestern Inv. Co. v. Neeley, 412 S.W.2d 925, 932 (Tex.Civ.App.-Fort Worth 1967), modified on other grounds, 430 S.W.2d 465 (Tex. 1968) ("Ratification is a doctrine of agency. Where there is no agency and no attempt to act as agent there is nothing to which the doctrine can apply."); see also Steward v. Church, 79 A.11 (Me. 1911) ("The doctrine of ratification applies only in cases where a person without authority assumes to have authority to act for another.").
Again, the Court has reviewed the relevant cases applying the doctrine of ratification in Texas and Maine and finds that the principles involved therein are the same in both jurisdictions.
As applied to the instant case, the doctrine of ratification does not advance Plaintiffs' position. Plaintiffs have mustered no evidence that Velez intended to act as A.C.'s agent rather than as an independent contractor when he and Cisneros conducted their recruitment activities. Without evidence of any kind of agency relationship, the doctrine of ratification is inapplicable. Plaintiffs have failed to bring to the Court's attention any cases in Texas or Maine where a court has implied an agency relationship by ratification where no agency relationship existed before, and the Court is unaware of any such case law. The Court did identify one case where the First Circuit applied the doctrine of ratification to find the minimum contacts necessary for personal jurisdiction; however, there was no dispute in that case that some kind of agency relationship existed between the defendants in question such that ratification principles became applicable. See Daynard v. Ness, Motley, Loadholt, Richardson Poole, P.A., 290 F.3d 42 (1st Cir. 2002) (attributing contacts where defendants held themselves out to plaintiff to be part of joint venture or other agency relationship and one defendant ratified the other defendant's act of hiring and retaining plaintiff). Therefore, the record before the Court provides no support for Plaintiffs' contention that A.C. had minimum contacts with Texas based on A.C's alleged ratification of the unilateral recruitment activities of Velez and Cisneros.
(3) No Purposeful Availment
Having determined that the common law principles of agency and ratification do not allow the imputation of the recruitment activities of Velez and Cisneros to A.C., the Court is limited to evaluating the isolated acts of A.C. for purposes of the minimum contacts analysis. When taken as a whole, the nature and quality of the acts committed by A.C. are insufficient to render it liable to suit in Texas. A.C. could not have anticipated being haled into Texas court based on its conduct and connection with Texas. Carver's alleged agreement to employ Plaintiffs via a telephone conversation with Velez while Plaintiffs were still in Texas is hardly sufficient to constitute an inference of purposeful availment of the benefits and protections of the forum state. As one observer has noted, "purposeful availment turns on the extent to which defendant's involvement in the forum was intentional." Flavio Rose, Related Contacts and Personal Jurisdiction: The "But For" Test, 82 CAL. L. REV. 1545, 1554 (1994). Carver's telephonic agreement to employ Plaintiffs rests on the mere fortuity that the Plaintiffs happened to be Texas residents. A.C. did not affirmatively reach into the state of Texas to obtain employees. See Williams v. Castro, 21 F. Supp.2d 691, 693-94 (S.D.Tex. 1998) (where non-resident employer did not specifically target the Texas market to obtain employees, his contacts did not satisfy constitutional test for existence of personal jurisdiction). Plaintiffs present no evidence that A.C. sought laborers specifically from Texas. Accordingly, Plaintiffs have not established purposeful availment by A.C.
Courts in this district have previously addressed similar claims by agricultural workers in Astorga v. Connleaf, 962 F. Supp. 93 (W.D.Tex. 1996) and Moreno v. Milk Train, 182 F. Supp.2d 590 (W.D.Tex. 2002), both of which are distinguishable from the instant cause because neither case involved an independent contractor acting entirely unilaterally to recruit workers. In Astorga, the defendant utilized a Texas-based farm labor contractor to hire workers to harvest tobacco in Massachusetts. Astorga, 982 F. Supp. at 94. In reviewing the relationship between the contractor and the defendant, the court found that they worked closely to recruit the workers. The out-of-state defendant sent the contractor a package of contracts and company regulations that were used to recruit workers in Texas. Id. at 95. The court also found that the contractor and the defendant had several telephone conversations, some of which were initiated by the defendant. Id. Finally, the defendant sent the contractor a contracting fee after the plaintiffs were recruited, as well as money to cover each of the plaintiffs' travel expenses. Id. Based on this evidence, the court found ample support for the existence of defendant's minimum contacts with Texas.
In Moreno, the defendant, a New York dairy, used a Texas-based farm labor contractor to locate and hire workers for agricultural employment in New York. Moreno, 182 F. Supp.2d at 591. This Court found that Milk Train hired the plaintiffs as a result of the recruitment activity of its agent, AG-Labor Services, and paid AG-Labor Services a contracting fee for each laborer it provided. Id. at 594. Plaintiffs also signed their employment contracts in Texas. Id. Moreover, as in Moreno, Milk Train also paid for Plaintiffs' bus fare and travel loan. Id.
The instant cause requires a different result than that in Astorga and Moreno. First, the court in Astorga found that the contractor "worked closely" with the defendant to recruit workers. There is no evidence of such cooperation between A.C. and Velez. Instead, it appears that Velez acted unilaterally, with little or no intervention from A.C. Second, there was no dispute in Moreno that the labor contractor served as an agent and intermediary (within the meaning of the Texas long-arm statute) for Milk Train. In that case, Milk Train contacted the labor contractor to specifically recruit Texas residents. As stated previously, there is no evidence that A.C. specifically targeted the Texas market for potential workers.
It is also significant that the plaintiffs in Astorga and Moreno signed employment contracts in Texas. Here, according to Velez, the Plaintiffs signed employment contracts in his office when they arrived in Maine. Plaintiff Paez testified that he signed some papers while in Texas, but was not sure what they were. Nonetheless, there is no evidence that Carver sent any contracts or company regulations to Plaintiffs in Texas for their signature, nor did Carver ask Velez to do so. For all of these reasons, the Court finds that Plaintiffs have not established a prima facie case of minimum contacts over A.C.
II. Personal Jurisdiction Over County Concrete A. Background
In April 2000, after learning that County Concrete was in need of laborers, Velez contacted Charlie Renski, an employee of Worcester Wreath, a division of County Concrete. Velez agreed to provide laborers to Renski to clear pine trees for Worcester Wreath, and Renski would pay Velez nine dollars an hour, out of which Velez would pay the workers a specific amount per hour. Renski and Velez did not reach an agreement on how much to pay the workers, but the evidence shows that Velez ultimately paid the workers six dollars an hour, and that Renski was aware that Velez was paying that amount. Renski agreed to provide housing rent-free. Renski told Velez that if everything went well, he would ask Velez for more workers. However, the two did not discuss how or from where Velez planned to recruit labor.
Velez first supplied four workers to Renski. Apparently, those workers left the job after a short period of time, leaving Renski without workers. When Cisneros called from Texas, Velez instructed Cisneros to tell the workers at the Opportunity Center that some of them would be working clearing pine trees. Velez instructed Cisneros to tell the workers that they would be paid six dollars an hour, and that they would not have to pay rent. Neither Velez nor Cisneros spoke with Renski about recruiting workers from Texas before Cisneros traveled there. According to Velez, he did not send anything in writing to Cisneros in Texas about the jobs with Renski. Moreover, neither County Concrete nor Worcester Wreath advanced funds to Velez to cover the costs of the Plaintiffs' food or bus tickets to Maine. When the Plaintiffs arrived from Texas, Velez sent some of them to A.C. and the rest to Worcester Wreath. According to Velez, Renski did not know the workers were Texas residents until they arrived in Maine.
B. Minimum Contacts
Plaintiffs' claim that County Concrete has sufficient minimum contacts to support jurisdiction is predicated on no more than their assertion that Renski set the terms and conditions of employment and housing. Plaintiffs do not even claim that any kind of agency relationship existed between County Concrete and Velez. Thus, Plaintiffs have identified no activities conducted in Texas or outside Texas by anyone at County Concrete that give rise to a finding of purposeful availment.
Renski did not direct Velez or Cisneros to travel to Texas to recruit Plaintiffs. Plaintiffs cannot show that, unlike Carver, Renski was even aware that Velez and Cisneros were recruiting workers in Texas before Plaintiffs arrived in Maine. Furthermore, neither Renski nor anyone else at Worcester Wreath or County Concrete advanced funds to Velez to cover the cost of the bus tickets or food for Plaintiffs. County Concrete could not have anticipated being haled into a Texas court based on Plaintiffs' allegation that the company set the terms and conditions of employment and housing for potential workers. Exercising jurisdiction over County Concrete based on these jurisdictional facts would be untenable. The Court finds that Plaintiffs have not satisfied their burden of setting forth sufficient evidence to support this Court's exercise of personal jurisdiction over County Concrete.
Therefore, after due consideration, the Court is of the opinion that Defendants' Motions to Dismiss should be granted.
Accordingly, IT IS HEREBY ORDERED that Defendant A.C., Inc.'s "Amended Motion to Dismiss" is GRANTED.
IT IS FURTHER ORDERED that Defendant County Concrete Construction Company, Inc.'s "Special and Limited Appearance and Motion to Dismiss" is GRANTED.