Texas Supreme Court Reaffirms That Non-Texas Companies Must “Target Texas” To Be Subject To Personal Jurisdiction
Client Alert | June 23, 2025
BRP-Rotax GmbH & Co. KG v. Shaik, No. 23-0756 & Hyundam Indus. Co. v. Swacina, No. 24-0207 – Decided June 20, 2025
In two opinions issued on June 20, the Texas Supreme Court reaffirmed that a non-Texas company must purposefully direct conduct at Texas to be subject to specific personal jurisdiction.
“The stream-of-commerce-plus test requires a defendant to specifically target Texas; it is not enough that a defendant may foresee some of its products eventually arriving here.”
Justice Young, writing for the Court in BRP-Rotax GmbH & Co. KG v. Shaik
Background:
In two recent cases, plaintiffs sued foreign manufacturers in Texas state court after being injured in Texas by allegedly defective products. Both defendants were foreign companies that designed and manufactured their products abroad, sold them to foreign distributors, and had no direct presence, sales, or marketing efforts in Texas. Plaintiffs argued that indirect sales, knowledge that the products might reach Texas, English-language websites, and general regional targeting (targeting the North American market, for example) sufficed to establish personal jurisdiction.
The trial court and court of appeals held that jurisdiction was proper based on the actions of the companies’ foreign distributors and the targeting of broader regions that include Texas.
Issue:
Can Texas courts assert specific personal jurisdiction over a non-Texas company that doesn’t directly target Texas for business?
Court’s Holding:
No. Under the stream-of-commerce-plus test, a defendant must specifically and purposefully target Texas to be subject to personal jurisdiction. It’s not enough that the defendant merely foresees its product ending up there.
What It Means:
- The Court reaffirmed that the stream-of-commerce-plus test requires a defendant to “specifically target Texas.” BRP-Rotax at 2; Hyundam at 1. Merely “placing a product into the stream of commerce does not establish purposeful availment unless there is ‘additional conduct’ evincing ‘an intent or purpose to serve the market in [Texas].’” BRP-Rotax at 8.
- The Court emphasized that what matters is only the defendant’s own conduct—not the conduct of independent foreign distributors and other third parties. BRP-Rotax at 11–17. The Court cautioned, however, that a foreign company can’t avoid jurisdiction in Texas by “formalistic structuring” or “deploying others” to target the Texas market on its behalf. BRP-Rotax at 12–13. Here, neither defendant used a Texas-based distributor and their distributor agreements didn’t specifically target Texas. BRP-Rotax at 12, 14; Hyundam at 11.
- The Court also clarified that its recent decision in State v. Volkswagen Aktiengesellschaft, 669 S.W.3d 399 (Tex. 2023), didn’t subject a defendant to personal jurisdiction merely because the defendant targeted a broad region that included Texas. BRP-Rotax at 18; Hyundam at 9–10. Instead, “the critical inquiry is whether a nonresident defendant has established sufficient contacts with Texas—not whether those contacts are materially different from its contacts with other states.” Hyundam at 10.
- Justices Busby and Devine concurred to urge the U.S. Supreme Court to discard the fairness-based approach to personal jurisdiction as unworkable, inconsistent, and historically unsound. They note “[t]hese squishy, subjective standards” have led Texas federal and state courts to apply different versions of the stream-of-commerce test—making it easier for Texas federal courts to exercise jurisdiction over non-Texas defendants—and advocate a return to a sovereignty-based approach rooted in constitutional text and history. BRP-Rotax concurrence at 1.
The Court’s opinion in BRP-Rotax is available here, and the concurring opinion is available here. The Court’s opinion in Hyundam is available here.
Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Texas Supreme Court. Please feel free to contact the following practice group leaders:
Appellate and Constitutional Law
| Thomas H. Dupree Jr. +1 202.955.8547 tdupree@gibsondunn.com |
Allyson N. Ho +1 214.698.3233 aho@gibsondunn.com |
Julian W. Poon +1 213.229.7758 jpoon@gibsondunn.com |
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Brad G. Hubbard +1 214.698.3326 bhubbard@gibsondunn.com |
Related Practice: Texas General Litigation
| Trey Cox +1 214.698.3256 tcox@gibsondunn.com |
Collin Cox +1 346.718.6604 ccox@gibsondunn.com |
Gregg Costa +1 346.718.6649 gcosta@gibsondunn.com |
This alert was prepared by Texas of counsel Ben Wilson and Texas associates Elizabeth Kiernan, Stephen Hammer, and Rebecca Roman.