OPINION Federal Corporation, Appellant, a Taiwanese manufacturer, sold tires to two wholesale distributors in the United States, one in California (Tire Dealer’s Warehouse), the other in Mississippi (Dunlap & Kyle). Desiree Truhlar, Carlos Alvarez, Rosendo Aguilar, Jenifer Butler, Maria T. Ruiz, Auden Tercero, Lucia Cereceres, Roberto Rodriguez, Priscilla Rodriguez and Liberty Insurance, Appellees, claim a Federal tire failed and caused an accident in Texas in which three people were killed and two others injured, all Texas residents. The tire at issue was shipped from Taiwan to a Tire Dealer’s Warehouse, in Phoenix, Arizona, but allegedly purchased in Texas. After it was sued, Federal filed a special appearance. Appellant contends the subject tire was sold in Taiwan. Appellant asserts it is a Taiwanese company with no contacts in Texas, and therefore, specific jurisdiction cannot stand because mere placement in the stream of commerce and foreseeability is not enough to uphold the trial court’s finding of specific jurisdiction. Appellees refute Appellant’s argument, claiming Appellant purposefully availed itself of Texas’ jurisdiction by placing their tires in the stream of commerce in Texas. Appellees point to Appellant’s purposeful activities in Texas: (1) shipping tires directly to Texas; (2) sending promotional materials to Texas distributors; (3) meeting with distributors in Texas once or twice a year; (4) assisting Texas residents in purchasing tires with their Texas distributors; (5) administering an interactive website for inquiries from Texas residents or tire distributors; (6) advertising on their website where their Texas distributors can be located; and (7) communicating regularly with their Texas distributors. The trial court denied Appellant’s special appearance, found Appellant’s contacts with Texas satisfy the requisites of specific jurisdiction and this interlocutory appeal followed. The question is whether the State of Texas can assert personal jurisdiction over a non-resident defendant, Federal Corporation, a Taiwanese company, in this products liability suit. We affirm. FACTUAL AND PROCEDURAL SUMMARY Federal Corporation, Inc. Appellant is a Taiwanese corporation; all their officers are Taiwan citizens, the board of directors has never held a meeting in Texas, nor have any of Appellant’s business activities been controlled by any Texas person or entity. Appellant has never been a resident of Texas or authorized to do business in Texas, does not have a registered agent for service of process, or a license to do business in Texas. Appellant has never owned real or personal property in Texas; does not maintain bank accounts in Texas; does not operate any facilities in Texas; does not pay income or employment tax in Texas; and does not have any employees, agents, sales representatives, or subsidiaries in Texas. Appellant also avers they have never transacted business in Texas, marketed their tires in Texas, advertised in Texas, designed or manufactured tires for sale in Texas, or manufactured other equipment for sale in Texas. Last, Appellant claims it has not established any channels for providing regular advice to customers in Texas nor marketed any tires through a distributor who has agreed to serve as a sales agent in Texas. The Subject Tire The unchallenged evidence demonstrates this wrongful death case arose from an automobile accident in Ector County on July 22, 2013. Appellees here, plaintiffs and intervenors in the trial court, allege the cause of the accident was the failure of a Federal tire due to a tread separation. The alleged defective tire at issue, a Federal Couragia M/T 35 X 12.50 R18 LT, was designed and manufactured in Taiwan near the end of 2011. The subject tire, according to Appellees, was purchased at Tire Club USA of El Paso, Texas. Mr. Dawu Chen, Appellant’s director of Global Sales and Marketing, was deposed in January 2016. Chen was questioned regarding computer screen shots showing bar code numbers on tires which give Appellant the ability to track where a particular tire is sold within the United States. Documents referenced in his deposition show potential locations where Appellant shipped the subject tire from Taiwan. The bar code on the subject tire was incomplete and missing some digits; according to Chen, Appellant took the bar code numbers that were visible to find out all the potential bar code numbers which could apply, and where all of those potential tires were shipped. Only two possible tire types fit the bar code of the subject tire, and based on the information for those two types, Appellant determined all of those two types of tires were “meant to be shipped” to Tire Dealers Warehouse in Phoenix, Arizona. However, Appellant cannot determine for sure whether those tires were in fact shipped only to Arizona. Federal Tires Distributed in Texas Appellant admits it sells to two companies that distribute tires in Texas. One is Tire Dealer’s Warehouse, which has its headquarters in Ohio. In a sworn declaration made by Chen and attached to Appellant’s answer subject to its special appearance, Appellant acknowledges it manufactured the subject tire and sold it to Tire Dealer’s Warehouse in Compton, California. According to Appellant, Tire Dealer’s Warehouse in Compton, California, shipped the tire to its location in Phoenix, Arizona. The subject tire was sold “Free on Board” (F.O.B.) in Taiwan meaning that title to the tire is transferred to Tire Dealer’s Warehouse at the time it was loaded on the ship in Taiwan. Appellant maintains Tire Dealer’s Warehouse had exclusive control over the distribution and final destination of the subject tire once title transferred in Taiwan. Appellant contends they have no control or any involvement in the decision as to where Tire Dealer’s Warehouse ultimately sends or sells the tire. However, Appellant admits that some of the tires sold to Tire Dealer’s Warehouse have “eventually” made their way into Texas. Appellant asserts there is no evidence demonstrating Appellant placed the subject in the stream of commerce in Texas. According to Appellant, they did not intend or expect the subject tire would be sold in Texas or to a Texas resident. The second distributor is Dunlap & Kyle of Batesville, Mississippi, which includes Gateway Tires (Gateway) of Carrollton, Texas and Hesselbein Tires Southwest (Hesselbein) of San Antonio, Texas. Appellant ships tires purchased by Dunlap & Kyle directly to Gateway and Hesselbein. Appellant asserts they have no control or any decision making authority regarding the ultimate destination of the tires sold to Dunlap & Kyle. All tire orders delivered to Gateway and Hesselbein are paid by Dunlap & Kyle. Further, Appellant states they have no distribution agreement with any of the distributors and have never exercised control over the marketing practices of these distributors. Appellant asserts they have never made any direct sale to any end-user in Texas, and according to Chen, the number of tires shipped to Texas amounted to between .4% and 1.4% of Appellant’s global sales. Chen supervises Appellant’s employees who communicate with Texas distributors. From 2009 through 2014, Appellant employed nine sales managers and team members who were responsible for Texas, including Charles Hsu and Elic Liu. These employees contacted Texas distributors directly and were responsible for ensuring Texas distributors had what they required and the shipping of their orders was correct. Mr. Chen, when asked if those distributors were selling tires in Texas, responded, “We don’t know exactly what they do with our tires.” On follow- up, he was asked whether tire facilities in Texas “would primarily be marketing to Texas customers . . . ?” Chen replied, “[W]e actually—we don’t know every detail [of] what they do in Texas.” Chen agreed distributors in Texas under parent company Dunlap & Kyle distributed Appellant’s tires. Documents in the record indicate Appellant contacted tire dealers in Texas to inquire about selling Federal tires. For example, Appellant’s representative in Taiwan, Alex Lu, emailed Doug Robinson in Carrollton, Texas and “Mr. Mullino,” in Mesquite, Texas, inquiring about whether they would be interested in selling Federal tire products. Chen testified the email indicates Appellant has several companies it ships its tires to, and Mr. Mullino could contact those companies to obtain Federal tires. Chen also clarified although Appellant’s contract is with Dunlap & Kyle in Mississippi, they ship directly to the state of Texas. Appellant also communicated with employees of Hesselbein and shipped tires directly to Hesselbein in Texas. According to Chen, Appellant ships its tires to Texas, California, Oregon, South Carolina, and New Jersey, along with a few other states, but not all fifty states. Delivery of Tires to Texas The record includes some twenty-nine sets of shipping documents of tires sold to Hercules Tire and Rubber of Ohio, but delivered to Tire Dealer’s Warehouse’s locations in San Antonio, Irving, and Houston, Texas. According to Appellant, Tire Dealer’s Warehouse is a division of Hercules Tire and Rubber of Ohio. The invoices and shipping documents reflect the exporter is Appellant, while the importer is Hercules, and the terms are F.O.B. Taiwan with payment due sixty days from the bill of lading date. The invoices cover a period from March 23, 2013, through November 14, 2013, in which it appears 11,251 tires were sent. The sales total of twenty-eight of these invoices is approximately $1,144,174 for the nine-month period. Another twenty-five invoices pertaining to Dunlap & Kyle reflect tires were shipped directly to either Carrollton or San Antonio, Texas. These tires were delivered to Gateway in Carrollton and Hesselbein in San Antonio. The invoices cover a period from April 30, 2013 through August 12, 2014 with 15,726 tires shipped to Texas. The sales total of twenty-three of the invoices is $1,743,159 for the sixteen-month period. The terms of the sale are “DDP Carrolton, Texas,” or “DDP San Antonio, Texas,” and payment is seventy-five days from bill of lading date. Chen explained in his deposition that “DDP” means “delivery duty paid;” in other words, Appellant handles “the entire transportation including ocean transport and inland transport to the door of anywhere where our customer wants us” to deliver the tires. Chen stated when tires are sold DDP, Appellant covers “the cost of the tire”, and “inland transportation cost in Taiwan, ocean freight, and inland transportation cost in the United States, and import duty.” Chen explained when tires are shipped in this manner, and if, for example, the container of tires is unloaded in California, the container is transported either by rail or truck to Texas. As the tires travel across Texas, they are owned by Appellant until they are delivered to their ultimate destination, and ownership transfers upon delivery. While Appellant’s tires are in transit throughout Texas, Appellant insures the tires against loss or accident. Chen explained that shipping documents and invoices for their products are prepared by Appellant. Chen pointed out the Texas distributors are not Federal tire dealers, but “[c]ompanies in Texas where we ship our tires.” Chen when asked about the individual email recipients of Texas distributors, replied, “Well, we believe they are […] they are involved in Federal tires, but whether they stay there, we don’t know exactly.” When asked to clarify, he stated, “We don’t know where they live, okay. We know they are working for those companies, and they are the ones that we need to maintain contact.” When pressed, “You know that some of those people work in the state of Texas, true?” He answered, “I believe so. I can’t just say that.” Chen stated Federal maintains constant communications with businesses in Texas to handle the shipments. Chen stated Appellant shipped tires to Texas after July 31, 2009 (the beginning of the discovery period), and in 2010, 2011, 2012, 2013. Chen further acknowledged Dunlap & Kyle, whom they invoiced for the shipped tires, have businesses in Texas to which Appellant ships Federal tires directly from Taiwan. Chen also stated many pertinent documents related to Appellant’s shipping history in Texas are lost because Appellant does not adhere to any file retention policy because they do not have an interest in retaining documents. Federal’s Advertising and Marketing in Texas The record reflects, and Appellant does not dispute, it sent the following advertising materials to Dunlap & Kyle Co. Inc. On July 3, 2014, Appellant sent free of charge to Carrollton, Texas: 5 Couragia A/T Banners 2 Couragia F/X Banners 100 Tread Depth Gauge key chains 40 Mobile One Touch stands 100 stickers 60 Catalogues 50 Couragia XUV Flyers 50 Couragia M/T Flyers Another invoice to Dunlap & Kyle reflects on July 24, 2013, free of charge, Appellant sent 14,000 cards to Carrollton, Texas, which the invoice described as a “promotional item.” In a March 5, 2010, email by Doug Robinson, sales manager at Gateway Tire of Texas, to Elic Liu, North American Team Executive, Global Sales Division, at Federal, Robinson asked, “I saw in the Tire Business magazine that you have showroom displays for the Federal line. Are these available to D & K?” Liu responded, “[I]n regards to the displays of Federal line, we are surely welcome you [sic] to have our image corner to be displayed in your retail store, that is also our new concept called ‘store in store’ for promoting Federal brand, kindly let me check with our marketing dept. for the details, and get back to you soon.” On July 1, 2010, in an email to Elic Liu at Federal from Doug Robinson at Gateway, Robinson asked for “more brochures, posters, stickers, banners, etc. sent to Farmers Branch.” Robinson said “We are doing good with the [F]ederal line and our customers are asking for these.” Liu replied, “You got it! I will try to arrange some of these promotional items into next available container to Farmers Branch, and we appreciate your efforts in making Federal brand more valuable to the end-users.” Robinson replied, “No problem Elic[,] I am happy to do so[.] Federal is a good tire and I look forward to a long relationship and you do a great job for us!!” On January 21, 2014, Charles Hsu, Appellant’s North American Sales Team Manager, Global Sales Division, sent an email to twenty individuals, including Robinson at Gateway and Chris Pope of Dunlap & Kyle in San Antonio, Texas, regarding a survey on Federal tires. The survey stated, Dear Valued Customer: Federal is planning to develop a new MT product that targets mainly at the pick up and sports utility market. We have tentatively set up 3 benchmarks and 28 sizes to fit the market demand. Furthermore, we would like to conduct a survey on benchmark products to enable an early finalization of our line up. Included in the survey were numerous questions regarding the general opinion of the “present Couragia M/T.” The survey asked for estimated demand for twenty-seven different types of Federal tires, including response options for annual quantities estimated and target prices. The survey also included a one-page “Client Satisfaction Survey.” The customer service survey provided five responses ranging from “below standard” through “excellent,” and asked the recipient to rate fifteen categories of Appellant’s products and services, including the following: service representatives’ expertise, responsiveness, and claim adjustments; quality and design of promotional items, and advertising exposure, and delivery schedule and correctness. It also asked, “How often do you expect our service people to visit you?” Chen discussed the survey in his deposition. According to him, the purpose of this “questionnaire” was to gauge demand for potential products Appellant may produce in the future, what the survey recipient thinks about Appellant’s current products, and what products their customers need. In an email sent March 4, 2010, Liu provided an updated price list with new released sizes to Dennis King, Richard Dunlap, and John King. The following day, Robinson asked Liu, “Could you do Howard and myself a big favor. For your EVO line in 18-20″ fitments do you have a list of targeted vehicles. This would help us very much in deciding which tires to order and stock. You could also send a list of targeted OE replacement for the other tires too.” Liu responds, “Please allow me a few days to gather the information of the fitment in our EVO line[.]” On March 13, 2010, Robinson emailed Liu “ re: The fitment information” asking, “Any update?” In October 2011, Liu sent an email to eleven individuals including Doug Robinson of Gateway and Terry Steinhouse of Hesselbein Tire in Lubbock, Texas. The email stated, “We are planning to change the speed rating for the size of 31 x 10.5 R15 M/T from R to Q rated. Please let us know would it be acceptable in your market.” Steinhouse responds, “Would be ok with us.” A January 7, 2011 email from Chris Pope at Hesselbein in San Antonio, Texas, to Liu asks, “Please see if you can ship me another few hundred of these ASAP.” In another email to Pope dated January 21, 2010, Liu states, Good day! Please find enclosed PI for both of [the] below orders, kindly sign and return to us for confirmation, please also double check with the price of 195/60 R15 88H-FD1, it should be [redacted], not [redacted] as appeared on your order form. Liu also asks for the address of Hesselbein’s warehouse in McAllen, Texas. In another email regarding orders, Pope states, “The price of the 195/60R 15 is off but I need special pricing on that size. You do not offer it in the ss657 design. Please make this happen for me.” Liu responds: Thank you for letting us know your below concern, please understand we have been facing the challenges in increasing trend of natural rubber (it is now [redacted]/ton), increase in freight costs (please [see] attached notice from shipping company), as well as devaluation of US dollars, all these giving us a great deal of pressure on our costs. However, I have noticed, we have been receiving good orders from you, especially in PCR lines, and this is certainly a good start at the beginning of this year, we would like to see this momentum can be [sic] continued, in order to give you our best support and after thorough discussion with our managements, the best offer we can do is [redacted] for 1,000 units, please kindly bear with us in light of these obstacle [sic] we are trying to conquer. Pope counters, “I really need better on that one size. Can you help?” Liu replies, “While waiting for your feedback on the 195/60 R15 (FD1), please advise if we could confirm you other sizes you were ordered into our system, so that we can start with production planning[.]“ Liu then writes: As per our conversation on the phone, [redacted] will be confirmed offer for 195/60R 15 FDI, please do understand we do this for partnership and to support you with the full line purchasing, in addition this price will only [be] valid for these two orders (PO# HS 15902 & PO# HS 15904) only, as I have previously explained we have been facing a great challenge on our cost structure, hope you can understand that the more we sale at this price the more lost we get. Lastly, please resent [sic] the signed PI with the amended price, so that we can confirmed [sic] in to [sic] our system, thank you in advance! Pope then indicates his approval via a subsequent email. Federal’s Warranty on Tires Sold in Texas Chen testified Federal has a process for warrantying its tires, which it grants to its distributors like Dunlap & Kyle, and is then “pass[ed] on to … the user [of the tire].” An email from Charles Hsu to Chris Pope on February 11, 2014, addresses the M/T tire warranty process. Hsu states: [I]n the future, if you have any single MT claim [tire], we will provide you the warranty for a set of MT (although it shouldn’t be happening more often than before since we have made the changes on MT), however, based on this MT warranty, we need a proof of invoice/receipt or any identification that you have had given your customer another set of MT as compensate in the future. Please don’t take me wrong that I am not trusting you that you are giving a set of MT tire to your customer for compensate [sic], I know the way you are handling on the MT claim for your customer that even your customer had claim for 1 MT, you would still compensate them for at least 2MT or even 1 set MT. Therefore, if there’s any MT claim in the future, please claim them by following the claim procedure as usual but please make sure to include a proof of invoice/receipt or any identification so we can proceed the warranty for you. An email dated December 29, 2011, from Scott A. Lyon of Hesselbein to Elic Liu attaches a PDF document referring to adjustment claims. Federal Representative Trips to Texas The evidence of travel by Federal employees to meet with Texas distributors is undisputed and the record contains copies of airline tickets, boarding passes, car rental receipts, and hotel receipts. The evidence in the record of Appellant’s travel to Texas during the relevant discovery period includes the following dates, employees, and locations: April 12, 2010Liu, AntingBoarding pass, Miami to Houston August 4 WorthLiu, AntingBoarding pass, Los Angeles to Dallas/Fort August 5 DetroitLiu, AntingBoarding pass, Dallas/Fort Worth to August 7, 2011Liu, An TingAvis car rental receipt, Dallas/Fort Worth August 7, 2011Liu, An TingHoliday Inn receipt, Dallas August 7, 2011 WorthLiu, AntingBoarding pass, Cleveland to Dallas/Fort August 8, 2011Liu, AntingChecked baggage receipt, Dallas August 8, 2011Liu, AntingHoliday Inn receipt, Houston August 8, 2011 HoustonLiu, AntingBoarding pass, Dallas/Fort Worth to August 9, 2011Liu, AntingChecked baggage receipt, Houston [illegible]Liu, AntingBoarding pass, Houston to San Francisco March 25, 2012Liu, AntingHoliday Inn receipt, San Antonio March 26, 2012Liu, AntingHoliday Inn receipt, Addison March 26, 2012 WorthLiu, AntingBoarding pass, San Antonio to Dallas/Fort March 27, 2012Liu, AntingChecked baggage receipt, Dallas/Fort
