Texas Business Court Decision – October 29, 2025

No. 25-BC01B-0019    JT Capital LLC v. Blom Capital LLC, et al. (Division 1, Judge Whitehill)  25-bc01b-0019-jt-capital-v-blom-capital-2025-tex-bus-41.pdf

Civil case –  Personal Jurisdiction. This dispute arises out of a deal between JT Capital, Blom, and Capella Funds to acquire an apartment building in Princeton, Texas. After they fell out, JT Capital sued Blom and Capella seeking return of its initial contribution. Blom and Capella later filed counterclaims/third-party claims against JT Capital and its officer, Sapan Talati; Talati, an non-resident, specially appeared, contending the court lacked both general and personal jurisdiction over him; Capella and Blom opposed the special appearance, contending that through both direct and indirect ownership interests and management, Talati maintained ongoing affiliations with Texas entities and targeted the Texas market, vesting the court with general personal jurisdiction; they also asserted that because Talati was the decision maker and principal of JT Capital, he had sufficient minimum contacts with Texas for specific personal jurisdiction. The court grants Talati’s special appearance and dismisses the claims against him without prejudice.

Held: (1) with respect to general personal jurisdiction, Capella failed to amend its pleadings to include any specific facts supporting its general jurisdiction premises, and its general jurisdiction argument is procedurally invalid;

(2) Capella’s claims regarding Talati’s contacts with Texas (ownership of property and mineral interests, initiating a lawsuit regarding the property, and indirect ownership of property in Austin and Crowley), were insufficient to establish general jurisdiction because these contacts failed to rise to the level of making Talati “essentially at home in the forum;” Talati testified that he had not lived in Texas, had not travelled to Texas since 2020,  and had not  visited the property in the last 12 years; merely owning unrelated property is insufficient to establish general jurisdiction over a nonresident; filing of an eviction suit on unrelated property did not create general jurisdiction;

(3) mere association with multiple Texas entities as either a member or manager was not sufficient to establish general jurisdiction; and, in any event, Talati’s contacts with Texas through his corporate affiliation would be protected by the fiduciary shield doctrine; to defeat the doctrine, Capella had to show these entities were merely Talati’s alter ego, and it did not do so;

(4) with respect to specific personal jurisdiction, Blom’s and Capella’s claims  to establish a basis for such jurisdiction would be assessed collectively, rather than claim-by-claim, because they all relate to Talati’s alleged representations and actions surrounding the planned acquisition, investment, and development of the property: (a) with respect to the claim that Talati directed JT Capital, JT Capital chose to do business in Texas, and Talati was its agent; it is the principal and not the agent who does business in the state; (b) JT Capital’s decision to pursue this litigation in Texas does not bestow jurisdiction over Talati; (c)  Talati would be responsible for any misrepresentations he made  in his corporate capacity  as the fiduciary shield doctrine applies as a defense to only general jurisdictional issues; however, the alleged misrepresentations do not demonstrate Talati purposefully availed himself of the forum; the Texas Supreme Court had held that phone calls and emails sent by nonresident defendants are insufficient evidence of purposeful availment; (d) because Talati never acquired ownership of the property, he never  personally enjoyed the benefits and protections of Texas law nor any of the continuing obligations that arise from real property ownership, and his supposed oral representations to guarantee the loan and be lead sponsor of the property acquisition did not create sufficient contacts; (e) seeking to profit from the deal is not sufficient to create specific personal jurisdiction; nor did Blom and Capella allege that Talati misappropriated Texas property or  that a misappropriation occurred in Texas; (f) the allegation that Talati partnered with Blom and Capella to purchase a note and the property is conclusory and does not establish jurisdiction;

(5) finally, an argument that Talati is subject to personal jurisdiction based on JT Capital’s activities because it operates as his alter ego is not supported by any underlying facts or evidence that Talati disregarded JT Capital’s corporate formalities or exerted control beyond that of a typical shareholder and corporate officer.