TravelJungle v. American Airlines, Inc.

Citation: Not availableDocket: 02-06-00178-CV

Court: Court of Appeals of Texas; December 13, 2006; Texas; State Appellate Court

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An accelerated interlocutory appeal was filed by TravelJungle against American Airlines, Inc., challenging the trial court's denial of TravelJungle's special appearance, which argued insufficient minimum contacts with Texas to establish personal jurisdiction. TravelJungle operates a website that aggregates travel information, including flight schedules and fares, but is registered in the UK and primarily operates from Germany and Bulgaria, lacking employees in the U.S. TravelJungle previously included American Airlines' website in its searches and displayed American's logo, but ceased these practices following American's lawsuit. American's claims against TravelJungle included breach of contract, tortious interference, trespass, violations of computer crime statutes, and trademark infringement. The trial court, after an evidentiary hearing, denied TravelJungle’s motion without issuing findings of fact or conclusions of law. On appeal, TravelJungle argued it disproved all bases for jurisdiction, while American contended that TravelJungle failed to meet its burden of proof, leading the appellate court to affirm the trial court's order.

The determination of personal jurisdiction over a defendant by a trial court is a legal question. The plaintiff must initially provide sufficient allegations to bring a nonresident defendant under the Texas long-arm statute, which allows jurisdiction if the defendant does business in Texas. A defendant challenging personal jurisdiction must negate all bases for it. When a trial court does not provide findings of fact or conclusions of law, necessary facts to support the judgment are implied, although these implied findings are not conclusive if the appellate record contains both reporter’s and clerk’s records.

Texas courts can assert personal jurisdiction over nonresidents only if both the Texas long-arm statute and due process requirements under the Fourteenth Amendment are met. The long-arm statute permits jurisdiction over nonresidents who conduct business in Texas, with a broad definition of "doing business" that includes committing a tort. This definition is not exhaustive but must align with constitutional due process, which requires that a defendant has minimum contacts with Texas and that exercising jurisdiction is fair and just.

The appellant contests only whether minimum contacts with Texas have been established. A nonresident defendant who purposefully avails itself of the benefits of conducting business in Texas has sufficient contacts to confer personal jurisdiction.

Foreseeability is a significant factor in determining whether a nonresident defendant has established minimum contacts with the forum state, although it is not the sole determinant. The analysis of minimum contacts focuses on the defendant's actions and reasonable expectations. Due to the burdens associated with defending in a foreign legal system, this analysis is crucial for defendants from other countries. Jurisdiction cannot be imposed based on random or tenuous contacts; defendants must have fair notice that their activities could subject them to foreign jurisdiction.

Three criteria help assess purposeful availment: (1) only the defendant's own contacts with the forum are considered; (2) the contacts must be intentional rather than coincidental; and (3) the defendant must derive some benefit from the forum. Personal jurisdiction over a nonresident can be either general or specific. General jurisdiction applies when a defendant has continuous and systematic contacts with the forum, allowing jurisdiction regardless of the cause of action. Specific jurisdiction exists when the defendant's alleged liability arises from activities within the forum.

For specific jurisdiction in Texas, the defendant's actions need not occur within the state, as long as those actions are purposefully directed toward Texas. A defendant is expected to foresee being brought to court if their activities intentionally target the forum state, even without physical presence. In the case of American's pleadings, it claims personal jurisdiction over TravelJungle based on allegations of torts committed in Texas, breach of a Texas-governed contract, violations of Texas law, and ongoing business operations in Texas.

American Airlines alleges that TravelJungle employs screen-scraping software on its websites, including Traveljungle.com, Traveljungle.us, and Hotfares.com, to access and extract proprietary fares from AA.com without authorization, violating the site's Use Agreement. The Use Agreement, although not explicitly requiring user consent, prohibits the use of automated devices without prior written consent from American. American argues that this unauthorized access depletes its computer resources and hampers its ability to serve legitimate customers, asserting that Texas has specific jurisdiction over TravelJungle due to these actions.

In response, TravelJungle submitted an affidavit from Kalina Krasteva, its operational manager, stating that TravelJungle is a UK-based travel data aggregator that collects data from airline and reservation sites, including Expedia and Travelocity, based on user inquiries. Krasteva noted that the company had established limited direct engagement with Texas residents and was unaware of American's disapproval of its practices until it received American's second amended petition in 2004. She further claimed that TravelJungle no longer accesses AA.com and obtains any information related to American flights solely from third-party sources and publicly available data. Additionally, American's Managing Director, Daniel Henry, provided an affidavit asserting that AA.com’s servers are located in Plano, Texas, and reiterated that screen-scraping consumes valuable computer capacity, depriving American of resources needed to serve its customers.

Henry stated that Exhibit 7 contains a computer report indicating that AA.com received 2,972 fare search requests from IP address 207.36.213.160 on June 14, 2004. Included in the response is a deposition from Bryce Short, Director of Customer Retention and Quality for Affinity Internet, Inc., who confirmed he could identify the customers associated with that IP address on the specified date. Short identified the end user, as detailed in attachment 1, which lists TravelJungle Limited, with Kallina Krasteva noted as the contact. 

During a hearing on April 13, 2006, Dr. Hans-Josef Vogel, a minority shareholder of TravelJungle, testified that the company utilizes a meta-search travel engine and does not engage in scraping, which he defined as taking images from another website. Instead, he explained that TravelJungle retrieves flight schedule and fare data upon consumer requests, using automated methods he referred to as "robots" or "spiders." Vogel acknowledged that TravelJungle initially needed to program AA.com into its search script and confirmed that the company ceased accessing AA.com by removing it from the script.

Vogel distinguished TravelJungle's method from Google.com’s random data collection, suggesting that TravelJungle’s access was inquiry-specific. He was unaware of AA.com’s server location and stated that TravelJungle had no physical presence or business dealings in Texas, aside from the described website activities. He confirmed that TravelJungle charges users only when they book a flight, not for merely accessing information. Krasteva’s affidavit asserted that TravelJungle did not retain any American fare data processed, with all revenues fully paid to reservation sites or American Airlines. Vogel testified that TravelJungle had never intentionally misrepresented information from AA.com, although he acknowledged the possibility of database errors. He also stated that American Airlines had never blocked TravelJungle’s access to its site.

American Airlines claims that TravelJungle’s repeated access and selling of fare data constitute purposeful activity directed towards Texas, asserting that such allegations meet the long-arm statute requirements, despite not fulfilling due process concerns.

TravelJungle failed to demonstrate that it negated American's allegations regarding the minimum contacts requirement for due process. TravelJungle argued it was merely an occasional viewer of AA.com, comparing its actions to those of a casual web user. However, a TravelJungle witness acknowledged that the company intentionally included AA.com in its software search script, indicating that its interactions were more than incidental. It was established that TravelJungle specifically targeted AA.com for data from February 2003 to June 2004, potentially resulting in server interactions in Texas.

Evidence presented by American showed that TravelJungle's registered website accessed AA.com nearly 3,000 times in one day and utilized significant server resources, which negatively impacted American's ability to serve its customers. The court concluded that TravelJungle's activities constituted purposeful direction towards AA.com's Texas servers for commercial gain, establishing a basis for jurisdiction.

TravelJungle's assertions that it was unaware of AA.com's server location and that it ceased its activities after being sued were rejected. The court noted that ignorance of server location does not exempt a party from personal jurisdiction when they intentionally engage in activities directed at that forum. This principle parallels federal cases where spam email senders can be held liable in the forum where their emails are received, as they knowingly target specific servers. No authority was found requiring a plaintiff to inform a defendant of objections to their activities for establishing jurisdiction.

Defendants in Verizon Online Svcs. Inc. v. Ralsky were found to have assumed the risk of harming valuable property in Virginia by intentionally sending millions of unsolicited bulk emails through Verizon’s servers for profit. The court emphasized that the focus is on the deliberate nature of the defendants' actions rather than their actual knowledge of the email destinations. Defendants cannot evade responsibility by claiming ignorance of the servers' locations. In a similar case involving TravelJungle, the court noted that TravelJungle's deliberate actions directed toward AA.com’s servers indicated awareness of potential jurisdiction in any forum where those servers were located. Consequently, TravelJungle was unable to negate jurisdiction based on American’s allegations, leading to the affirmation of the trial court's order denying TravelJungle's special appearance. The case was remanded for further proceedings, and a prior stay on American's claims against TravelJungle was lifted. The ruling was delivered on December 14, 2006, by Justice Terrie Livingston and the panel consisting of Justices Livingston, Gardner, and Walker.