IN THE SUPREME COURT OF TEXAS

IN THE SUPREME COURT OF TEXAS

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No. 05-0823

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PHC-Minden, L.P. = d/b/a=20 Minden Medical Center,

Petitioner,

Kimberly-Clark = Corporation,=20

Respondent

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On Petition for Review from = the

Court of Appeals for the Twelfth = District of=20 Texas

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Argued November=20 16, 2006

Chief Justice Jefferson delivered the opinion of the = Court.

The = United=20 States Constitution prohibits a court from exercising jurisdiction over = a party=20 that lacks minimum contacts with the forum. Personal jurisdiction has = been=20 described as either specific=97that is, based on contacts arising from = the dispute=20 at issue=97or general, predicated on a party=92s =93continuous and = systematic=94=20 contacts with the forum. Minimum-contacts analysis is easily muddled, = however,=20 as courts frequently import contacts relevant to one type of = jurisdiction when=20 deciding the other. Additionally, courts sometimes impute contacts of = related=20 entities to each other, when mere relatedness is an insufficient basis = on which=20 to confer jurisdiction. Today, we must determine whether a Louisiana = hospital,=20 either independently or through its parent corporation, has continuous = and=20 systematic contacts with Texas. We conclude that it does not.

Factual and Procedural Background

&nbs= p;=20 While traveling through Louisiana on December 10, 2000, Texas resident = Jajah=20 Eddington sought medical care at MHC-Minden Hospital (=93Minden = Hospital=94), a=20 159-bed acute care hospital located in Minden, Louisiana. Medical = personnel=20 treated Eddington=92s flu-like symptoms in the emergency room and = advised her to=20 consult her primary care physician if her condition did not improve. = Four days=20 later, Eddington was admitted to Good Shepherd Medical Center in = Longview,=20 Texas, where she ultimately was diagnosed with toxic shock syndrome. = That=20 infection led to her death on December 28, 2000.

&nbs= p;=20 DeWayne Eddington, individually and as next friend of Devvyn Eddington, = and as=20 representative of Jajah Eddington=92s estate, sued Kimberly-Clark = Corporation=20 asserting product liability, breach of warranty, and negligence claims. = He=20 alleged that Eddington=92s use of Kotex tampons led to the infection = that caused=20 her death. On February 28, 2003, Kimberly-Clark filed a third-party = petition=20 against PHC-Minden, L.P. (=93Minden=94), which owns Minden Hospital, = asserting that=20 Minden=92s negligence proximately caused Eddington=92s death.[1]=20 Minden is a nonresident of Texas and a wholly owned subsidiary of = Province=20 Health Care (=93Province=94). Kimberly-Clark pleaded that Province, = whose=20 headquarters is in Tennessee, did business in Texas and that its = forum-related=20 acts should be imputed to Minden because: (1) Province owns Minden; (2) = Province=20 and Minden share officers, directors, and =93common departments or = business=94; (3)=20 Province and Minden do not differentiate their operations and have = failed to=20 erect =93formal barriers=94 between themselves; and (4) Province=92s = officers and=20 directors control Minden=92s policies. Minden filed a special appearance = and,=20 subject thereto, a general denial. The parties conducted extensive = discovery=20 relating to the jurisdictional issue. After a hearing, the trial court = concluded=20 it had general jurisdiction over Minden and denied the special = appearance.

&nbs= p;=20 The court of appeals affirmed, reasoning that (1) Minden itself had = =93continuous=20 and systematic contacts with Texas=94; and (2) Minden and Province = operated as a=20 single business enterprise, and Minden, through Province, did business = in Texas.=20 202 S.W.3d 193, 203-04. We granted Minden=92s petition for review to = decide=20 whether Texas courts have general jurisdiction over Minden.[2]=20 49 Tex. Sup. Ct. J. 950 (Aug. 25, 2006).

General=20 Jurisdiction

&nbs= p;=20 The Texas long-arm statute governs Texas courts=92 exercise of = jurisdiction over=20 nonresident defendants. See Tex.=20 Civ. Prac. & Rem. Code =A7=A7 17.041-.045. That statute = permits Texas=20 courts to exercise jurisdiction over a nonresident defendant that = =93does=20 business=94 in Texas, and the statute identifies some activities that = constitute=20 =93doing business.=94 Id. =A7 17.042. The list, however, is not = exclusive.=20 BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex. = 2002). We=20 have held that section 17.042's language extends Texas courts=92 = personal=20 jurisdiction =93as far as the federal constitutional requirements of due = process=20 will permit.=94 U-Anchor Adver., Inc. v. Burt, 553 S.W.2d 760, = 762 (Tex.=20 1977). Thus, we rely on precedent from the United States Supreme Court = and other=20 federal courts, as well as our own decisions, in determining whether a=20 nonresident defendant has negated all bases of jurisdiction. See BMC=20 Software, 83 S.W.3d at 795-796. Personal jurisdiction over = nonresident=20 defendants is constitutional when: (1) the defendant has established = minimum=20 contacts with the forum state, and (2) the exercise of jurisdiction = comports=20 with traditional notions of fair play and substantial justice. = Int=92l Shoe Co.=20 v. Washington, 326 U.S. 310, 316 (1945).

&nbs= p;=20 In Helicopteros Nacionales de Colombia, S.A. v. Hall, the Supreme = Court=20 adopted the terms =93specific=94 and =93general=94 to describe the = differing types of=20 personal jurisdiction. Helicopteros, 466 U.S. 408, 414 (1984) = (citing=20 Arthur T. von Mehren & Donald T. Trautman, Jurisdiction to = Adjudicate: A=20 Suggested Analysis, 79 Harv. L.=20 Rev. 1121, 1144-1164 (1966)). The Court defined specific = jurisdiction as=20 =93arising out of or related to the defendant's contacts with the = forum.=94=20 Id. at n.8. By contrast, the Court referred to general = jurisdiction as=20 =93personal jurisdiction over a defendant in a suit not arising out of = or related=20 to the defendant's contacts with the forum.=94[3]=20 Id. at n.9 (citations omitted).

&nbs= p;=20 In Helicopteros, the Court concluded that Texas courts did not = have=20 general jurisdiction over a Colombian company, Helicol. One of = Helicol=92s=20 helicopters had been involved in a crash in Peru, and the survivors and=20 representatives of the decedents sued Helicol in state district court in = Harris=20 County, Texas. Helicol filed a special appearance and moved to dismiss = the case,=20 but the trial court denied the motion. The court of appeals, however, = agreed=20 with Helicol that in personam jurisdiction over Helicol was lacking.=20 Helicopteros Nacionales de Colombia, S.A. v. Hall, 616 = S.W.2d 247=20 (Tex. App.=97Houston 1981). Our Court reversed. Hall v. Helicopteros = Nacionales=20 de Colombia, S.A., 638 S.W.2d 870 (1982).

&nbs= p;=20 The Supreme Court granted certiorari, and it summarized the pertinent=20 jurisdictional facts:

It is=20 undisputed that Helicol does not have a place of business in Texas and = never has=20 been licensed to do business in the State. Basically, Helicol's contacts = with=20 Texas consisted of sending its chief executive officer to Houston for a=20 contract-negotiation session; accepting into its New York bank account = checks=20 drawn on a Houston bank; purchasing helicopters, equipment, and training = services from Bell Helicopter for substantial sums; and sending = personnel to=20 Bell's facilities in Fort Worth for training.

Helicopteros, = 466 U.S. at=20 416. The Court concluded that the CEO=92s trip to Houston could not be = described=20 as a =93continuous or systematic=94 contact. Id. Similarly, it = held that=20 Helicol=92s acceptance of checks drawn on a Houston bank was of = =93negligible=20 significance.=94 Id. at 416. The Court held, relying on a 1923 = unanimous=20 opinion written by Justice Brandeis, that =93purchases and related = trips, standing=20 alone, are not a sufficient basis for a State's assertion of = jurisdiction.=94=20 Id. at 417 (citing Rosenberg Bros. & Co. v. Curtis Brown = Co.,=20 260 U.S. 516 (1923)).

&nbs= p;=20 The point at which jurisdictional contacts reach a tipping point, = however, has=20 eluded precise formulation. Beyond stating that mere purchases and = related=20 travel are not enough, the Supreme Court has given little guidance on = the=20 appropriate inquiry for general jurisdiction, although its = Helicopteros=20 conclusion that general jurisdiction was improper suggests that the=20 requisite level of contacts is fairly substantial. 16 James Wm. Moore et al., Moore=92s = Federal=20 Practice =A7 108.41[3] = (3d=20 ed. 2007); 4 charles Alan = Wright &=20 Arthur R. Miller, Federal Practice & Procedure =A7 1067.5 = (2007)=20 (noting that the Court=92s rejection of each contact and its failure to = aggregate=20 contacts =93suggests very strongly that the threshold contacts required = for a=20 constitutional assertion of general jurisdiction over a nonresident = defendant=20 are very substantial, indeed=94). Perkins v. Benguet Consolidated = Mining=20 Co., the only case in which that court has upheld a finding of = general=20 jurisdiction, offers an insight into the nature of the contacts = required.=20 Perkins, 342 U.S. 437 (1952). In assessing whether the = nonresident=20 defendant=92s Ohio contacts were sufficient to warrant a finding of = general=20 jurisdiction, the Court noted that the company=92s president, who was = also the=20 general manager and principal shareholder, maintained an Ohio office in = which he=20 =93did many things on behalf of the company.=94 Id. at 447-48. He = maintained=20 company files in Ohio, carried on correspondence from there, drew and=20 distributed salary checks from his Ohio office, used two Ohio bank = accounts for=20 company funds and had an Ohio bank act as transfer agent for the = company=92s=20 stock, held directors=92 meetings in Ohio, supervised policies dealing = with the=20 rehabilitation of the corporation's properties in the Philippines there, = and=20 dispatched funds from Ohio bank accounts to cover purchases of machinery = for=20 such rehabilitation. Id. The Court concluded that the company = =93carried on=20 in Ohio a continuous and systematic supervision of the necessarily = limited=20 wartime activities of the company,=94 and even though =93no mining = properties in=20 Ohio were owned or operated by the company, many of its wartime = activities were=20 directed from Ohio and were being given the personal attention of its = president=20 in that State at the time he was served with summons.=94 Id. at = 448. The=20 Court held that =93under the circumstances above recited, it would not = violate=20 federal due process for Ohio either to take or decline jurisdiction of = the=20 corporation in this proceeding.=94 Id.

&nbs= p;=20 A general jurisdiction inquiry, therefore, is very different from a = specific=20 jurisdiction inquiry and involves a =93more demanding minimum contacts = analysis,=94=20 CSR, Ltd. v. Link, 925 S.W.2d 591, 595 (Tex. 1996), with a = =93substantially=20 higher=94 threshold, 4 Wright = &=20 Miller, Federal Practice & Procedure =A7 1067.5. Usually, = =93the=20 defendant must be engaged in longstanding business in the forum state, = such as=20 marketing or shipping products, or performing services or maintaining = one or=20 more offices there; activities that are less extensive than that will = not=20 qualify for general in personam jurisdiction.=94 4 Wright & Miller, Federal = Practice &=20 Procedure =A7 1067.5; see also Hall, 638 S.W.2d at 882 = (Pope, J.,=20 dissenting) (noting that =93substantial and continuous activity=94 = required for=20 general jurisdiction suggests that defendant =93must establish some = close=20 substantial connection with the state approaching the relationship = between the=20 state and its own residents=94); 16 Moore=92s Federal Practice = =A7 108.41[3]=20 (stating that general jurisdiction =93typically requires the defendant = to have an=20 office in the forum state=94); Lea Brilmayer, A General Look at = General=20 Jurisdiction, 66 Tex. L. = Rev.=20 723, 742 (1988) (proposing that =93the basic inquiry must be whether the = defendant's level of activity rises to the level of activity of an = insider, so=20 that relegating the defendant to the political processes is fair=94); = Charles W.=20 =93Rocky=94 Rhodes, Clarifying General Jurisdiction, 34 Seton Hall L. Rev. 807, 811 = (2004)=20 (suggesting that a proper general jurisdiction query should evaluate = whether the=20 defendant engaged in activities in the forum state similar in frequency = and=20 nature to the activities of local businesses); Mary Twitchell, The = Myth of=20 General Jurisdiction, 101 Harv. L.=20 Rev. 610, 635 (1988) (noting that =93traditional indicia=94 of = general=20 jurisdiction are =93a home base, an agent for the service of process, a = local=20 office, or the pursuance of business from a tangible locale within the=20 state=94).

General=20 jurisdiction has been described as =93dispute-blind,=94 an exercise of = the court=92s=20 jurisdiction made without regard to the nature of the claim presented.=20 Twitchell, The Myth of General Jurisdiction, 101 Harv. L. Rev. at 613. It = involves a=20 court=92s ability to exercise jurisdiction over a nonresident defendant = based on=20 any claim, including claims unrelated to the defendant=92s contacts with = the=20 state. 16 Moore=92s Federal = Practice =A7=20 108.40. Some commentators suggest that courts assessing general=20 jurisdiction employ an analytical device to determine whether the = jurisdiction=20 is, in fact, dispute-blind. Twitchell, The Myth of General = Jurisdiction,=20 at 680; Rhodes, Clarifying General Jurisdiction, 34 Seton Hall L. Rev. at 819. = They propose=20 that the court construct a hypothetical claim without any forum = connection =93to=20 insure that any related forum activities of the defendant are not = improperly=20 infiltrating the dispute-blind query.=94 Clarifying General = Jurisdiction,=20 34 Seton Hall L. Rev. = at 819. For=20 example:

[A]re the=20 corporate defendant=92s actual activities in California so pervasive and = extensive=20 that it should be amenable to the adjudicatory jurisdiction of = California for a=20 hypothetical employment discrimination claim filed by a New York citizen = employed at corporate headquarters in New York? Or, with respect to a = foreign=20 corporation, do the corporation=92s actual California contacts support=20 jurisdiction even for a hypothetical cause of action arising from its = sale of a=20 product in Germany that injured a German citizen?

Id. at=20 819-20. Such an inquiry properly frames the issue, as general = jurisdiction is=20 based solely on the defendant=92s =93continuous and systematic=94 = contacts with the=20 forum. Helicopteros, 466 U.S. at 416.

Minden=92s=20 Contacts

&nbs= p;=20 With this in mind, we turn to an analysis of Minden=92s Texas contacts, = as the=20 court of appeals concluded that Minden had =93continuous and systematic = contacts=20 with Texas=94 sufficient to support general jurisdiction. 202 S.W.3d at = 204. We=20 first determine the appropriate time period for assessing contacts for = purposes=20 of general jurisdiction, an issue on which our courts of appeals are in=20 conflict. Some examine the defendant=92s forum-related activities up to = the time=20 of the occurrence that prompted the suit. See MedCost, L.L.C. = v.=20 Loiseau, 166 S.W.3d 421, 434 (Tex. App.=97Austin 2005, no pet.); = Schott=20 Glas v. Adame, 178 S.W.3d 307, 313-14 (Tex. App.=97Houston [14th = Dist.] 2005,=20 pet. denied); AmQuip Corp. v. Cloud, 73 S.W.3d 380, 388 (Tex.=20 App.=97Houston [1st Dist.] 2002, no pet.). Others focus on contacts up = to the time=20 of filing suit. See, e.g., Equitable Prod. Co. v. = Canales-Trevino, 136=20 S.W.3d 235, 237-38, 245 (Tex. App.=97San Antonio 2004, pet. denied) = (considering=20 corporate defendant's relocation from Texas, which occurred after the = cause of=20 action accrued but before suit was filed, for purposes of determining=20 jurisdiction); see also Tuscano v. Osterberg, 82 S.W.3d 457, 467 = (Tex.=20 App.=97El Paso 2002, no pet.) (holding that jurisdictional contacts were = =93too=20 attenuated in time,=94 because such activities occurred more than = =93three years=20 before service of this suit was effected=94). Another=97the court of = appeals in this=20 case=97noted the conflict and assessed contacts under both timetables.[4]=20 202 S.W.3d at 203 (=93A relevant continuous contact in this analysis = includes=20 those contacts over a period up to the date of injury . . . or up to and = including the date suit commenced . . . .=94).

&nbs= p;=20 We conclude that the relevant period ends at the time suit is filed. As = noted=20 above, general jurisdiction is dispute-blind; accordingly, and in = contrast to=20 specific jurisdiction, the incident made the basis of the suit should = not be the=20 focus in assessing continuous and systematic contacts=97contacts on = which=20 jurisdiction over any claim may be based. See Charles W. = =93Rocky=94 Rhodes,=20 The Predictability Principle in Personal Jurisdiction Doctrine: A = Case Study=20 of the Effects of a =93Generally=94 Too Broad, But =93Specifically=94 = Too Narrow=20 Approach to Minimum Contacts, 57 Baylor L. Rev. 135, 238 = (2005) (noting=20 that =93analyzing the contacts at the time of accrual is not appropriate = under the=20 proper explanation of general jurisdiction as dispute-blind general = adjudicative=20 authority=94); see also 4 Wright=20 & Miller, Federal Practice & Procedure =A7 1067.5 (noting = that =93a=20 court should consider all of a defendant's contacts with the forum state = prior=20 to the filing of the lawsuit=94). We also agree that =93a mere one-time = snapshot of=20 the defendant=92s in-state activities=94 may not be sufficient, = see Rhodes,=20 Predictability Principle, 57 Baylor L. Rev. at 239, = and=20 contacts should be assessed over a reasonable number of years, up to the = date=20 suit is filed, see Access Telecom, Inc. v. MCI Telecomms. Corp., = 197 F.3d=20 694, 717 (5th Cir. 1999). This includes contacts at the time the cause = of action=20 arose, and it comports with the Supreme Court=92s guidance on the issue, = as well=20 as our prior caselaw. See Helicopteros, 466 U.S. at 409-11 = (evaluating=20 contacts over the seven-year period before suit was filed); American = Type=20 Culture Collection, Inc. v. Coleman, 83 S.W.3d 801, 807-08 (Tex. = 2002)=20 (assessing contacts over the twenty-year period preceding suit).

&nbs= p;=20 We now turn to Minden=92s contacts up to the time of suit. A general = jurisdiction=20 inquiry can be tedious, as it =93demands . . . that all contacts be = carefully=20 investigated, compiled, sorted, and analyzed for proof of a pattern of=20 continuing and systematic activity.=94 Schlobohm v. Schapiro, 784 = S.W.2d=20 355, 359 (Tex. 1990). In conducting this dispute-blind inquiry, = Jajah=92s=20 Eddington=92s status as a Texas resident, her treatment in Minden = Hospital=92s=20 emergency room, and her family=92s choice not to sue Minden are = irrelevant.=20 Instead, we focus solely on Minden=92s contacts with Texas. Minden is a=20 nonresident limited partnership that owns a hospital licensed by the = state of=20 Louisiana. Minden=92s only facility is in Minden, Louisiana, and ninety = percent of=20 its patients reside within a twenty-five mile radius of Minden Hospital. = Minden=20 does not advertise in Texas. It owns no Texas property and has no Texas = office=20 or bank accounts, nor does it maintain a registered agent for service of = process=20 here. The court of appeals relied on three categories of contacts in = determining=20 that Minden=92s Texas contacts were continuous and systematic: (1) = Minden=20 employees=92 attendance at seminars in Texas; (2) Minden=92s purchases = from vendors=20 with Texas addresses; and (3) three contracts with Texas entities. We = examine=20 each in turn.

1. =20 Texas Trips

The=20 evidence showed that, since 1999, Minden employees attended two=20 Province-sponsored meetings in Dallas. These isolated trips fall short = of the=20 =93continuous and systematic contact=94 the Supreme Court requires. In=20 Helicopteros, the Supreme Court rejected the notion that multiple = trips=20 to Fort Worth supported general jurisdiction, noting that the trips did = not =93in=20 any way enhance[] the company=92s contacts with Texas.=94 466 U.S. at = 418; see=20 also Kulko v. California Superior Court, 436 U.S. 84, 93 (1978) = (basing=20 California jurisdiction on 3-day and 1-day stopovers in that State = =93would make a=20 mockery of=94 due process limitations on assertion of personal = jurisdiction);=20 Nat=92l Indus. Sand Ass=92n v. Gibson, 897 S.W.2d 769, 774 (Tex. = 1995)=20 (concluding that attending a meeting in Texas, as well as periodic = mailings to=20 Texas members, =93presented no evidence of general jurisdiction=94). We = agree with=20 that analysis.

2. =20 Payments to Texas Vendors

Since=20 October 1, 1999, Minden paid $1,508,467.20 to 136 entities with Texas = addresses.=20 The largest payment, $515,650.15, was to Alcon Laboratories in Dallas, = Texas,=20 and the second largest, $209,997.36, to Centerpoint Energy in Houston, = Texas.=20 Most of the remaining payments are for less than $10,000.00 each. In=20 Helicopteros, 466 U.S. at 418, the Supreme Court held that = =93mere=20 purchases, even if occurring at regular intervals, are not enough to = warrant a=20 State's assertion of in personam jurisdiction over a nonresident = corporation in=20 a cause of action not related to those purchase transactions.=94 And we = have=20 recognized that =93purchases from Texas vendors will not alone support = the=20 exercise of general jurisdiction.=94 American Type Culture = Collection, 83=20 S.W.3d at 808. We conclude that the payments to Texas vendors do not = support=20 general jurisdiction over Minden in Texas.

3. =20 Contracts with Texas Entities

The=20 court of appeals also identified three contracts with a Texas = connection: (1) a=20 September 23, 2003 contract with Cox Business Services, a Tyler, = Texas-based=20 company, for internet service (at a charge of $59.95 per month) and a = cable=20 modem; (2) a July 2002 contract with Lone Star Research, located in The=20 Woodlands, Texas, pursuant to which Lone Star Research would conduct a = one-time=20 marketing survey of 200 adult residents in Minden Hospital=92s service = area; and=20 (3) an April 2001 professional services agreement with Horizon = Radiology, P.A.,=20 a Texas company, whereby Horizon would provide specialty coverage (via=20 teleradiology equipment) to Minden Hospital, in exchange for $1600 per=20 month.

&nbs= p;=20 We agree with the court of appeals that the 2003 Cox contract, entered = into=20 after suit was filed, is irrelevant to the jurisdictional inquiry here. = 202=20 S.W.3d at 203. The 2002 Lone Star contract pursuant to which a Texas = company=20 conducted a marketing study of residents in Minden Hospital=92s service=20 area=97presumably Louisiana, as ninety percent of the hospital=92s = patients live=20 within twenty-five miles of the hospital=97does not establish a = continuous and=20 systematic Texas contact. Lone Star agreed to conduct 200 telephone = interviews=20 and analyze the data within a week of the survey=92s completion, in = exchange for=20 $5,200. This type of sporadic Texas contact is not substantial enough = for=20 general jurisdiction.

&nbs= p;=20 Of the three contracts, the Horizon agreement has the most substantial=20 connection to Texas. The agreement, signed in 2001 and renewed twice = thereafter,=20 required that Louisiana-licensed physicians (located in Texas) provide=20 teleradiology services, for which Minden supplied the necessary = equipment, in=20 exchange for $1600 per month. Even this agreement, however, does not = support=20 general jurisdiction. Hiring a contractor to perform such limited = services in=20 the forum state does not equate to =93continuous and systematic = contacts.=94

&nbs= p;=20 Even when amassed, Minden=92s Texas contacts simply are not = =93continuous and=20 systematic general business contacts=94 sufficient to support general=20 jurisdiction, particularly when compared to the substantial, regular = business=20 activities conducted by the nonresident defendant in Perkins.=20 Helicopteros, 466 U.S. at 416; Perkins, 342 U.S. at = 447-48.=20 Instead, the facts here are more like those described in = Helicopteros:=20 the nonresident defendant had limited contacts with Texas but none = sufficient to=20 support general jurisdiction. Accordingly, the court of appeals erred in = holding=20 otherwise.

Jurisdictional Veil-Piercing

&nbs= p;=20 As its second basis for general jurisdiction, the court of appeals = imputed=20 Province=92s Texas contacts to Minden, concluding the two entities = operated as a=20 single business enterprise and that Minden, through Province, did = business in=20 Texas. In 1925, the Supreme Court of the United States considered = whether a=20 North Carolina court had jurisdiction over a nonresident parent = corporation=20 whose subsidiary did business in North Carolina. Cannon Mfg. Co. v. = Cudahy=20 Packing Co., 267 U.S. 333, 335 (1925). In affirming the district = court=92s=20 dismissal for lack of jurisdiction, the Court held:

Through=20 ownership of the entire capital stock and otherwise, the defendant = dominates=20 [its subsidiary], immediately and completely; and exerts its control = both=20 commercially and financially in substantially the same way, and mainly = through=20 the same individuals, as it does over those selling branches or = departments of=20 its business not separately incorporated which are established to market = the=20 [defendant=92s] products in other states. The existence of the = [subsidiary] as a=20 distinct corporate entity is, however, in all respects observed. Its = books are=20 kept separate. All transactions between the two corporations are = represented by=20 appropriate entries in their respective books in the same way as if the = two were=20 wholly independent corporations.

Id.=20 The Court concluded that =93the corporate separation, though perhaps = merely=20 formal, was real. It was not pure fiction.=94 Id. at 337.

The=20 Court has never disavowed Cannon, despite an opportunity to do = so.=20 Instead, it essentially echoed the Cannon rule in Keeton v. = Hustler=20 Magazine, Inc., 465 U.S. 770, 781 n.13 (1984). See William A. = Voxman,=20 Comment, Jurisdiction over a Parent Corporation in Its Subsidiary's = State of=20 Incorporation, 141 U. Pa. = L.=20 Rev. 327, 339 (1992) (noting that Keeton footnote = implicitly=20 recognized Cannon=92s continuing validity). In that case, = then-Justice=20 Rehnquist, writing for the Court, noted that =93jurisdiction over a = parent=20 corporation [does not] automatically establish jurisdiction over a = wholly owned=20 subsidiary. . . . Each defendant=92s contacts with the forum State must = be=20 assessed individually.=94 Keeton, 465 U.S. at 781 n. 13; see = also=20 Voxman, 141 U. Pa. L. = Rev. at=20 338 (noting that =93[t]he clear implication of Rehnquist's assertion is = that the=20 nature of the parent-subsidiary relationship may well be a factor in = determining=20 whether jurisdiction comports with due process, but the existence of the = relationship will not, in and of itself, be dispositive of the = issue=94).

&nbs= p;=20 The Fifth Circuit Court of Appeals followed Cannon in Hargrave = v.=20 Fibreboard Corp.:

Cannon . . . = stands=20 for the proposition that so long as a parent and subsidiary maintain = separate=20 and distinct corporate entities, the presence of one in a forum state = may not be=20 attributed to the other. Cases in this circuit appear to have followed = the=20 Cannon rule in applying the Texas long-arm statute, although = sometimes=20 without explicit citation. We have noted often that 100% stock ownership = and=20 commonality of officers and directors are not alone sufficient to = establish an=20 alter ego relationship between two corporations. Generally, our cases = demand=20 proof of control by the parent over the internal business operations and = affairs=20 of the subsidiary in order to fuse the two for jurisdictional purposes. = The=20 degree of control exercised by the parent must be greater than that = normally=20 associated with common ownership and directorship. All the relevant = facts and=20 circumstances surrounding the operations of the parent and subsidiary = must be=20 examined to determine whether two separate and distinct corporate = entities=20 exist.

Hargrave,=20 710 F.2d 1154, 1160 (5th Cir. 1983)(citations omitted). The court held = that the=20 two corporations at issue =93maintained a degree of corporate separation = that was=20 more than superficial=94 and =93[t]he policy making authority held and = exercised by=20 [the parent] was no more than that appropriate for a sole shareholder of = a=20 corporation=94 and not enough to warrant the extraterritorial exercise = of=20 jurisdiction over that shareholder. Id. at 1161. The court = concluded:=20 =93The Lone Star of Texas may shine brightly throughout the world, but = its long=20 arm is not judicially all encompassing.=94 Id.

We=20 recently followed Hargrave (and, by implication, Cannon) = in=20 explaining when the contacts of a related corporate entity may be = considered for=20 purposes of determining general jurisdiction. BMC Software Belg., = N.V. v.=20 Marchand, 83 S.W.3d 789, 795-796 (Tex. 2002). We held that = =93[p]ersonal=20 jurisdiction may exist over a nonresident defendant if the relationship = between=20 the foreign corporation and its parent corporation that does business in = Texas=20 is one that would allow the court to impute the parent corporation=92s = =91doing=20 business=92 to the subsidiary.=94 Id. at 798 (citing = Hargrave, 710=20 F.2d at 1159 and Walker v. Newgent, 583 F.2d 163, 167 (5th Cir. = 1978)).=20 The rationale for exercising jurisdiction is that =93the parent = corporation exerts=20 such domination and control over its subsidiary =91that they do not in = reality=20 constitute separate and distinct corporate entities but are one and the = same=20 corporation for purposes of jurisdiction.=92=94 Id. (quoting = Hargrave,=20 710 F.2d at 1159 (citations omitted)). We required that the party = seeking to=20 ascribe one corporation=92s actions to another by disregarding their = distinct=20 corporate entities prove this allegation, because Texas law presumes = that two=20 separate corporations are distinct entities. Id.; accord = 4A Wright & Miller, Federal = Practice &=20 Procedure =A7 1069.4 (noting a =93reluctance to exercise personal = jurisdiction over a subsidiary merely because its parent corporation is = doing=20 business in the forum state=94). We concluded that there was no evidence = to=20 support the trial court=92s finding of general jurisdiction over a = Belgian=20 subsidiary based on allegations it was the alter ego of its American = parent.=20 BMC Software, 83 S.W.3d at 801.

&nbs= p;=20 1. Single Business=20 Enterprise

&nbs= p;=20 Here, the court of appeals held that Province and Minden operated as a = single=20 business enterprise=97a theory we have never endorsed=97and, therefore, = Province=92s=20 Texas contacts could be imputed to Minden.[5]=20 202 S.W.3d at 202; see Southern Union Co. v. City of = Edinburg, 129=20 S.W.3d 74, 86-87 (Tex. 2003) (noting that this Court =93has never = considered the=20 =91single business enterprise=92 concept in any detail=94 and declining = to decide=20 =93whether a theory of =91single business enterprise=92 is a necessary = addition to=20 Texas law regarding the theory of alter ego for disregarding corporate=20 structure=94). In doing so, the court of appeals examined eight factors = as they=20 related to Minden and Province: (1) common employees, (2) common = offices, (3)=20 centralized accounting, (4) payment of wages by one corporation to = another=20 corporation's employees, (5) common business name, (6) services rendered = by the=20 employees of one corporation on behalf of another corporation, (7) = undocumented=20 transfers of funds between corporations, and (8) unclear allocation of = profits=20 and losses between corporations. 202 S.W.3d at 201-02. The court=92s = analysis=20 failed to recognize, however, that veil-piercing for purposes of = liability=20 (=93substantive veil-piercing=94) is distinct from imputing one = entity=92s contacts to=20 another for jurisdictional purposes (=93jurisdictional = veil-piercing=94).

&nbs= p;=20 Courts have acknowledged that jurisdictional veil-piercing and = substantive=20 veil-piercing involve different elements of proof. See, e.g., Wells = Fargo=20 & Co. v. Wells Fargo Express Co., 556 F.2d 406, 425 (9th Cir. = 1977)=20 (noting that undercapitalization, =93which is important to deciding = whether to=20 pierce the veil raised by a subsidiary corporation in order to hold the = parent=20 corporation liable for failure of the subsidiary to meet its debts, may = not be=20 relevant to a showing that the two corporations are in fact one so as to = establish that the out-of-state corporation=97be it parent or = subsidiary=97is=20 present within the forum for jurisdictional purposes=94; instead, =93the = operative=20 question is whether the two corporations are in fact mere = =91divisions=92 or=20 =91branches=92 of a larger whole=94); Daimler-Benz Aktiengesellschaft = v. Olson,=20 21 S.W.3d 707, 721 n.5 (Tex. App.=97Austin 2000, pet. dism=92d w.o.j.) = (=93Although=20 many of the factors relevant to [determining whether subsidiaries=92 = contacts=20 should be imputed to parent] may also be relevant in determining whether = a=20 parent corporation should be liable for the actions of its subsidiary, = the=20 determination whether two corporate entities are one and the same for=20 jurisdictional purposes is distinct.=94), cert. denied, 535 U.S. = 1077=20 (2002); see also 2-32 William V.=20 Dorsaneo, Texas Litigation Guide =A7 32.06 (2005). This makes = sense in=20 light of the fact that personal jurisdiction involves due process = considerations=20 that may not be overriden by statutes or the common law. Cf. City of = Monroe=20 Employees Ret. Sys. v. Bridgestone Corp., 399 F.3d 651, 667-668 (6th = Cir.=20 2005) (refusing, in case involving jurisdictional allegations based on = alleged=20 =93control person=94 under the securities laws, to =93substitute our = analysis of the=20 securities laws=92 substantive bases for liability for the required, = due-process=20 based personal jurisdiction analysis=94); AT&T Co. v. Compagnie = Bruxelles=20 Lambert, 94 F.3d 586, 591 (9th Cir. 1996) (concluding that = =93liability is not=20 to be conflated with amenability to suit in a particular forum. Personal = jurisdiction has constitutional dimensions, and regardless of policy = goals,=20 Congress cannot override the due process clause, the source of = protection for=20 non-resident defendants.=94); In re Baan Co. Sec. Litig., 245 F. = Supp. 2d=20 117, 129 (D.D.C. 2003) (noting that liability under the Securities Act = =93cannot=20 on its own support personal jurisdiction,=94 as such an approach = =93impermissibly=20 conflates statutory liability with the Constitution's command that the = exercise=20 of personal jurisdiction must be fundamentally fair=94); Michiana = Easy Livin=92=20 Country, Inc. v. Holten, 168 S.W.3d 777, 790-91 (Tex. 2005) = (rejecting=20 theory that where defendant =93directed a tort=94 was relevant inquiry = for specific=20 jurisdiction, as such a rule improperly =93equat[ed] the jurisdictional = inquiry=20 with the underlying merits=94); Nat=92l Indus. Sand Ass'n v. = Gibson, 897=20 S.W.2d 769, 773 (Tex. 1995) (observing that =93[c]onspiracy as an = independent=20 basis for jurisdiction has been criticized as distracting from the = ultimate due=20 process inquiry: whether the out-of-state defendant's contact with the = forum was=20 such that it should reasonably anticipate being haled into a court in = the forum=20 state=94 and declining to recognize personal jurisdiction based on = conspiracy=20 allegation); John A. Swain & Edwin E. Aguilar, Piercing the Veil = to=20 Assert Personal Jurisdiction Over Corporate Affiliates: An = Empirical=20 Study of the Cannon Doctrine, 84 B.U.L. Rev. 445, 453 (2004) = (noting=20 that =93the principle of limited liability is statutory and does not = speak to=20 judicial jurisdiction=94).

&nbs= p;=20 For this reason, fraud=97which is vital to piercing the corporate veil = under=20 section 21.223 of the Business Organizations Code=97has no place in = assessing=20 contacts to determine jurisdiction. See Tex. Bus. OrgS. Code =A7 = 21.223.=20 Similarly, some of the factors courts look to in determining whether an = entity=20 may be held liable as a =93single business enterprise=94 are irrelevant = to an=20 analysis of jurisdictional contacts. For example, the court of appeals = examined=20 whether Province and Minden shared a common name and concluded that = =93[Minden=92s]=20 partnership name and initials, PHC-Minden, L.P. can be construed as a = reference=20 to Province Healthcare Company.=94 202 S.W.3d 201. Whether two related = entities=20 share a common name, however, does not affect whether each has = sufficient=20 contacts with the forum for jurisdictional purposes.

&nbs= p;=20 2. Factors

&nbs= p;=20 Instead, we recently outlined the relevant factors for jurisdictional=20 veil-piercing:

To =93fuse=94=20 the parent company and its subsidiary for jurisdictional purposes, the=20 plaintiffs must prove the parent controls the internal business = operations and=20 affairs of the subsidiary. But the degree of control the parent = exercises must=20 be greater than that normally associated with common ownership and = directorship;=20 the evidence must show that the two entities cease to be separate so = that the=20 corporate fiction should be disregarded to prevent fraud or = injustice.

BMC=20 Software, 83 S.W.3d at 799 (citations omitted). We also relied on = our prior=20 precedent, which held that =93[a] subsidiary corporation will not be = regarded as=20 the alter ego of its parent merely because of stock ownership, a = duplication of=20 some or all of the directors or officers, or an exercise of the control = that=20 stock ownership gives to stockholders.=94 Gentry v. Credit Plan Corp. = of=20 Houston, 528 S.W.2d 571, 573 (Tex. 1975). A leading treatise = suggests that=20 in determining whether a subsidiary corporation is subject to the = jurisdiction=20 of a forum state because its parent corporation is present or doing = business=20 there, courts should determine whether the subsidiary is =93separate and = distinct=20 from its parent corporation for personal jurisdiction purposes,=94 = taking into=20 account the amount of the subsidiary=92s stock owned by the parent = corporation,=20 the existence of separate headquarters, the observance of corporate = formalities,=20 and the degree of the parent=92s control over the general policy and=20 administration of the subsidiary. 4A=20 Wright & Miller, Federal=20 Practice & Procedure =A7 1069.4.

&nbs= p;=20 Here, the court of appeals cited the following as evidence that Province = and=20 Minden were a single business enterprise:

the record=20 shows that Province and [Minden] have at least one common employee and = that=20 Province pays certain [Minden] employees, although the salaries are = intercompany=20 payables. The names of the two companies are similar, and Province = employees=20 provide various services to assist [Minden] in its operations. Province=20 exercises control over [Minden]'s revenues and expenditures and oversees = [Minden]'s operations, financial performance, and completion of = strategic=20 initiatives. Further, Province audits [Minden]'s financial goals to = determine if=20 [Minden] will be able to meet these goals. Considering the totality of = this=20 evidence, we conclude that Province and [Minden] have integrated their = resources=20 to achieve a common business purpose.

202 = S.W.3d at=20 202.

Upon=20 closer examination, however, it is clear that Province does not exercise = the=20 sort of control over Minden that is required to fuse them for = jurisdictional=20 purposes. BMC Software, 83 S.W.3d at 799. Much of the = evidence=20 cited points to parental involvement=97involvement consistent with its = investor=20 status=97not atypical control. See 16 Moore=92s Federal Practice =A7 = 108.42[3][b]. =93Appropriate parental = involvement=20 includes monitoring the subsidiary=92s performance, supervision of the=20 subsidiary=92s finance and capital budget decisions, and articulation of = general=20 policies.=94 Id. What is lacking here is the =93plus=94 factor, = =93something=20 beyond the subsidiary=92s mere presence within the bosom of the = corporate family.=94=20 Dickson Marine, Inc. v. Panalpina, Inc., 179 F.3d 331, 338 (5th = Cir.=20 1999); see also Central States, Southeast & Southwest Areas = Pension Fund=20 v. Reimer Express World Corp., 230 F.3d 934, 943 (7th Cir. 2000) = (holding=20 that =93constitutional due process requires that personal jurisdiction = cannot be=20 premised on corporate affiliation or stock ownership alone where = corporate=20 formalities are substantially observed and the parent does not exercise = an=20 unusually high degree of control over the subsidiary=94); De Castro = v.=20 Sanifill, Inc., 198 F.3d 282, 283-84 (1st Cir. 1999) (requiring = =93strong and=20 robust=94 evidence of parental control over subsidiary, such that = subsidiary is=20 =93mere shell,=94 before subsidiary=92s contacts could be imputed to = parent). The two=20 entities maintain separate headquarters, Minden in Louisiana and = Province in=20 Tennessee. Minden=92s Board of Governors approves Minden=92s budget and = oversees=20 day-to-day operations, and Minden alone establishes its policies and = procedures=20 for providing health care to patients. Province is not involved in = Minden=92s=20 physician recruitment, and the two entities share no directors. While = Minden=92s=20 chief executive officer, chief nursing officer, and chief financial = officer=20 receive their paychecks from Province, their salaries are intercompany = payables;=20 that is, the monies come from Minden=92s revenues. Similarly, while = Province=20 provides Minden=92s general liability insurance and a group health = insurance=20 policy for its employees, the policies are funded from Minden=92s = revenues. There=20 is no indication that Minden and Province have disregarded corporate=20 formalities. The court of appeals cited evidence that two Minden = employees=20 received Province stock options, but we have said that =93a parent = company=92s=20 offering a stock option plan to a subsidiary=92s employees is acceptable = under IRS=20 regulations and is not evidence of abnormal control over the = subsidiary.=94 BMC=20 Software, 83 S.W.3d at 800. Put simply, we find no evidence of = control other=20 than that consistent with Province=92s investor status, and the court of = appeals=20 erred in imputing Province=92s Texas contacts to Minden.

III

Conclusion

&nbs= p;=20 Minden does not have continuous and systematic contacts with Texas, nor = is there=20 any basis for imputing Province=92s Texas contacts to Minden. We reverse = the court=20 of appeals=92 judgment and render judgment dismissing the claims against = Minden=20 for want of jurisdiction. Tex. = R. App.=20 P. 60.2(c).

______________________________

Wallace B.=20 Jefferson

Chief=20 Justice

OPINION=20 DELIVERED: August 31,=20 2007 &nb= sp; &nbs= p; = ; = =20