Cases and Deals

Blank Rome Secures Unanimous Reversal in TX Court of Appeals Fraud Lawsuit for TBS Business Solutions USA, Inc. and CEO Tewodros “Teddy” Sahilu

A Blank Rome team successfully secured a unanimous reversal before the Texas Ninth Court of Appeals on behalf of its California-based clients, TBS Business Solutions USA, Inc. and TBS’s CEO, Tewodros “Teddy” Sahilu. The final opinion was delivered on September 15, 2022.

In a commercial dispute filed in Jefferson County, Texas, the plaintiff sought to recover damages against TBS and Mr. Sahilu for the failure of TBS’ customer (defaulting co-defendants in the case) to deliver 1,000,000 N95 face masks to the plaintiff nor to refund the plaintiff’s deposit. The lawsuit asserted various fraud and conspiracy claims against the defendants. The Blank Rome team swiftly filed a special appearance, objecting to personal jurisdiction over TBS and Mr. Sahilu on the grounds that the plaintiff had failed to plead sufficient jurisdictional facts, that TBS and Mr. Sahilu are California residents, and that they did not have the necessary minimum contacts with Texas for the court to exercise personal jurisdiction over them.

After the defaulting co-defendants filed evidence in support of the plaintiff’s case against TBS and Mr. Sahilu and the trial court denied the special appearance, the Blank Rome team appealed. The appellants’ briefing and oral argument ultimately proved successful as the Texas Court of Appeals unanimously reversed the trial court’s order, finding that under the laws of the State of Texas, TBS and Mr. Sahilu lacked sufficient minimum contacts with the state, while also assessing costs against the plaintiff/appellee.

To learn more, please read California Mask Distributor Avoids Fraud Lawsuit in Texas Court (Bloomberg Law, September 15, 2022).

The Blank Rome team was led by Arash Beral who argued before the Court of Appeals, with significant support from Stephanie Holden in drafting the appellate brief and preparing for oral argument.