Arizona official sued . . . in Texas?

Suing an Arizona state official in a Texas federal court seems just bound for a quick dismissal. But Stroman Realty Inc., a Conroe, Texas-based company that brokers the resale of timeshare interests, tried it anyway. On Jan. 11, the 5th U.S. Circuit Court of Appeals issued its opinion in Stroman Realty Inc. v. Wercinski, finding that Stroman could not sue Sam Wercinski, Arizona's real estate commissioner, in Texas court due to a lack of personal jurisdiction. Stroman, which had brokered transactions between out-of-state timeshare buyers and Arizona sellers, originally sued Wercinski's predecessor Elaine Richardson after she sent the Texas company a cease-and-desist ordering Stroman to stop doing business in Arizona, because its agents lacked Arizona real estate licenses. Eventually, the cease-and-desist order became a final, nonappealable decision. Stroman sued Richardson in U.S. District Court for the Southern District of Texas, but the district court dismissed the suit on the ground of res judicata. Stroman appealed, but the 5th Circuit again nixed the suit for lack of personal jurisdiction. "[T]he totality of the Commissioner's contacts with Texas," the 5th Circuit stated, "involves a cease and desist order and correspondence with Stroman's attorneys. Although the Commissioner has 'reached out' to assert her authority over Stroman's Arizona-related business activities, she has not 'purposefully availed' herself of the benefits of Texas law like someone actually 'doing business' in Texas."
-- Jonathan Fox