IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION

FUNDSXPRESS FINANCIAL NETWORK, INC.,
Plaintiff,

v.

DIGITAL INSIGHT CORPORATION,
JOHN DORMAN, VINCENT BRENNAN,
RONALD GOFFMAN, ERIC EDWARDS, and
STEPHEN CRAIN,
Defendants.

PLAINTIFF FUNDSXPRESS FINANCIAL NETWORK, INC.'S OPPOSITION TO
DEFENDANTS JOHN DORMAN'S AND VINCENT BRENNAN'S MOTION TO DISMISS
COMPLAINT PURSUANT TO RULE 12(b)(2)

TO THE HONORABLE SAM SPARKS:

Plaintiff FundsXpress Financial Network, Inc. ("FundsXpress") responds
to Defendants John Dorman's and Vincent Brennan's Motion to Dismiss
Complaint Pursuant to Rule 12(b)(2) as follows:

INTRODUCTION

This case is about the electronic theft of FundsXpress's trade
secrets. Defendant Dorman is the Chairman and CEO and Defendant
Brennan is the Senior Vice President for Sales of Digital Insight
Corp., FundsXpress's direct competitor. These executives orchestrated,
authorized, supported and participated in the theft of FundsXpress's
trade secrets, copyrighted material, and confidential information and
then used that information to help Digital Insight and to harm
FundsXpress. Dorman and Brennan knew that FundsXpress was located in
Texas and that the stolen information they obtained originated in
Texas. They now claim, however, that they are not subject to personal
jurisdiction in Texas because neither Defendant traveled to Texas
while engaging in the theft. Dorman and Brennan are not insulated from
jurisdiction in Texas because they were engaging in theft of trade
secrets that were generated in Texas to harm a Texas company. Because
they committed a tort knowing and intending that its impact would be
felt in Texas, and because their wrongful actions were directed
towards Texas, they must be held accountable in Texas for their
actions.

FACTS

FundsXpress is a Texas corporation with its offices located in Travis
County, Texas. Exhibit 1. FundsXpress provides Internet banking
services to independent community banks, credit unions and smaller
financial institutions. See Plaintiffs' Third Amended Petition PP
17-18. Defendant Digital Insight, a Delaware corporation with its
corporate headquarters in Calabasas, California, offers similar
services to the same market. Id. PP 2, 14. Both companies have
regional salesmen and other employees living in other states.

In May 2001, Eric Edwards, a regional sales manager for Digital
Insight, possessed sensitive trade secrets and other proprietary
information that belonged to FundsXpress. Exhibit 1.[1] Edwards
forwarded those trade secrets to Brennan who forwarded the information
to another Digital Insight employee, Ken Mathe. In the email titled
"FundX info", Brennan and Edwards were careful to devise a plan to
distribute FundsXpress trade secrets and proprietary information
without being caught. Edwards writes:

   ... Please protect the source by not passing on via email. Print
   and disperse if needed. Thanks...

In forwarding the email to another Digital Insight employee Brennan
writes "do not pass on."

Furthermore, the email indicated additional FundsXpress information
would be forwarded via fax. Edwards writes:

   ... Check your fax for the customer list, interface target,
   interface deliverables, etc. More to follow...

In addition, in October 2001, a FundsXpress salesman, Gifford Dunn,
became a Digital Insight sales representative while still employed by
FundsXpress. Exhibit 2, p. 6.[2] Dunn was in regular contact with
Edwards during this period. Id. pp. 6, 25-26. Digital Insight began
paying Dunn as its employee on October 31, 2001. Id. p. 6. With
Digital Insight's knowledge, however, Dunn continued to draw a
paycheck from FundsXpress throughout November,
2001. Id. p. 2627. During November, Dunn retained access to
FundsXpress's computer systems in Texas and the proprietary documents
contained on that system. Id. pp. 7-1O, 26-27. Using his continued
access to the FundsXpress Texas computers, Dunn sent himself, and then
forwarded to Edwards, documents containing FundsXpress's most
confidential trade secrets. Id. pp. 7-10; Exhibit 1.

On November 30, 2001, Dunn's last day of work at FundsXpress and just
before his access to the FundsXpress computer system was cut off, Dunn
again sent an email message from the FundsXpress Texas computer system
to his home computer with a copy of the Dynamic Website Tutorial and
Documentation for its new Dynamic Website portal product. Exhibit 2,
pp. 9-10. This enabled Dunn to access the document and to provide it
to Digital Insight, which he did via email to Edwards on December 3,
2001. Edwards forwarded the information to the Digital Insight
management team, including Dorman, in California. Exhibit 3.[3]

Digital Insight and its management team, including Dorman and Brennan,
participated in the authorized the theft of trade secrets from
FundsXpress and used that information to help Digital Insight and
damage FundsXpress. Dorman and Brennan claim that they are not subject
to jurisdiction in Texas because they do not have sufficient contacts
with Texas. Their authorization of the theft of Texas trade secrets
and information subjects them to the jurisdiction of Texas courts.

STANDARDS FOR PERSONAL JURISDICTION IN TEXAS

In considering personal jurisdiction, this Court must take all
uncontroverted allegations in plaintiff's pleadings as true and
resolve all conflicts between the facts asserted by the parties in the
plaintiffs favor. D.J. Investments, Inc. v. Metzeler Motorcylce Tire
Agent Gregg, Inc., 754 F.2d 542, 546 (5th Cir. 1985). Jurisdictional
analysis is equitable and highly fact specific. Guardian Royal
Exchange Assur., Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223,
231 (Tex. 1991). Texas state law determines whether this Court has
personal jurisdiction. Panda Brandywine Corp. v. Potomac Elec. Power
Co., 253 F.3d 865, 867 (5th Cir. 2001). The Court has jurisdiction if
the Texas long-arm statute authorizes jurisdiction and such exercise
is consistent with due process. Cartidge v. Hernandez, 9 S.W.3d 341,
346 (Tex. App. - Houston [14th Dist.] 1999, no pet.);
Tex. Civ. Prac. & Rem. Code S 17.042. These two limitations are the
same. Panda, 253 F.3d at 867. This Court, therefore, need only decide
whether subjecting Dorman and Brennan to suit in Texas is consistent
with Fourteenth Amendment due process. See Electrosource,
Inc. v. Horizon Battery Technologies, Ltd., 176 F.3d 867, 871 (5th
Cir. 1999). Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex. 1990).

Federal due process requires that the nonresident have purposefully
established "minimum contacts" with the forum state and that the
exercise of jurisdiction over the nonresident comport with
"traditional notions of fair play and substantial justice."
International Shoe Co. v. State of Washington, 326 U.S. 310, 66
S.Ct. 154, 158 (1945). A nonresident establishes minimum contacts with
Texas by purposefully availing himself of privileges and benefits of
conducting business with Texas. World-Wide Volkswagen
Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 154, 158 (1945). A
nonresident defendant is subject to specific jurisdiction in Texas if
the plaintiffs claims against him arise out of his actions or are
directed towards Texas. Burger King v. Rudzewicz, 471 U.S. 462, 486,
105 S.Ct. 2174, 2189 (1985). If Dorman and Brennan conducted business
in Texas or intentionally directed acts toward Texas, they must have
foreseen being sued in Texas courts. Id. at 471, 2182

THIS COURT HAS SPECIFIC JURISDICTION OVER DORMAN AND BRENNAN

A. Dorman and Brennan were "doing business" in Texas.

The Texas long-arm statute authorizes jurisdiction over a nonresident
defendant "doing business" in Texas. Tex. Civ. Prac. & Rem. Code S
17.042. A person does business in Texas if he commits a tort in whole
or in part in Texas. Tex. Civ. Prac. & Rem. Code S 17.042(2). A tort
causing harm or injury in Texas satisfies the Texas long-arm statute
that a defendant be "doing business in Texas" in order to be subject
to Texas courts, even if the wrongful act or acts took place in other
states. Hearne v. Dow-Badische Chem. Co., 224 F.Supp. 90, 96
(S.D. Tex. 1963).

In a copyright infringement case where personal jurisdiction was
judged under Illinois law, the court discussed jurisdiction based upon
a tortfeasor's acts outside Illinois causing harm in
Illinois. Janmark, Inc. v. Reidy, 132 F.3d 1200 (7th
Cir. 1997). Janmark, an Illinois corporation, claimed copyright to a
"mini shopping cart." Reidy disputed Janmark's claims, claiming the
cart design as its own and allegedly threatened a Janmark customer in
New Jersey with suit for contributory infringement. Id. at
1202. Reidy's threat was made by phone from California. After the
call, the New Jersey customer stopped buying Jannmark carts, and
Jannmark sued in Illinois for a declaratory judgment that it had not
infringed any copyright and for damages based on tortious acts in
Illinois. Id. The Seventh Circuit held that personal jurisdiction
existed in Illinois because "the state in which the injury occurs may
require the wrongdoer to answer for its deeds even if events were put
in train outside its borders." Id.

Jurisdiction over Dorman and Brennan arise out of similar
circumstances. Although they resided in California and Georgia, they
authorized, encouraged and received stolen information from
FundsXpress's computer system in Texas. The theft of that information
was designed to injure FundsXpress. Dorman and Brennan distributed the
stolen information to their employees so that those employees could
use the information against FundsXpress - to persuade FundsXpress
customers and potential customers not to contract with FundsXpress for
Internet banking services. The injury and the tort occurred in Texas.

Dorman and Brennan cite Wilson v. Belin to support their argument that
the Court lacks jurisdiction. Belin, however, involved an unsolicited
phone call to individuals in Indiana and Iowa from a Texas
reporter. When the various statements made by the out-of-state
defendants were published in a Texas newspaper, the out-of-state
defendants were sued for libel. The facts of this case are remarkably
different than those of Belin.

This case involves a systematic and determined effort by executives of
Digital Insight to steal and distribute trade secrets and proprietary
information of FundsXpress to injure FundsXpress. Dorman and Brennan
were successful in improperly obtaining the information, knowing of
its origin, and distributing the information for the benefit of
Digital Insight and to the detriment of FundsXpress with the specific
intent to harm FundsXpress. That Dorman and Brennan were not in Texas
when they received and distributed FundsXpress's trade secrets does
not matter. They knew where the harm from their actions would occur,
and they must reasonably expect to be sued in Texas. B. Dorman and
Brennan actions were "aimed at" Texas.

Furthermore, specific jurisdiction arises when a person's actions are
"aimed" at the forum state. Calder v. Johnes, 465 U.S. 783, 789-790,
104 S.Ct. 1482, 1487 (1984). Calder held that the directed actions of
a defendant are sufficient to establish specific jurisdiction, even in
instances where a defendant's contacts with the state are not
systematic and continuous enough to establish general
jurisdiction. Id. at 787. The Texas Supreme Court established
guidelines for when a defendant's actions meet the Calder standard or
directed action for personal jurisdiction: "first, the defendant's
activities must have been 'purposefully directed' to the forum, and
second, the litigation must result from alleged injuries that 'arise
out of or relate' to those activities." National Indus. Sand Asstn
v. Gibson, 897 S.W.2d 769, 774 (Tex. 1995) quoting, Burger King
v. Rudzewicz, 471 U.S. at 472, 105 S.Ct. at 2182.

Both purposeful direction and injuries arising out of or relating to
the alleged activities are present here. Dorman and Brennan authorized
and received FundsXpress's trade secrets. They knew that stealing
FundsXpress's confidential information, trade secrets and copyrighted
information would damage FundsXpress's ability to compete in the
marketplace. Dorman and Brennan knew that their actions would have a
devastating impact on FundsXpress. Dorman and Brennan purposefully
directed their actions toward a Texas company. FundsXpress's claims
arise directly out of Dorman's and Brennan's directed
actions. Therefore, the two prongs of National are satisfied.

Finally, a single directed action can satisfy a minimum contact
analysis. In Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208 (5th
Cir. 1999), the Fifth Circuit found personal jurisdiction over a
German national in a fraud and breach of contract case. The district
court had ruled in Wien that the defendant's contacts with Texas
related to "an ongoing relationship between the parties established in
Germany and do not establish that [the defendant] purposefully availed
himself of the benefits and protections of Texas law." The Fifth
Circuit reversed, relying on Calder, to find that, "[e]ven if the
parties formed their relationship in Germany . . . a single act by
[the defendant] directed towards Texas that gives rise to a cause of
action by [plaintiffs] can support a finding of minimum contacts."
Wien 195 F.3d at 211. The defendant's alleged acts in Wien were
misrepresentations to the plaintiffs construed as "tortious actions
outside of Texas directed towards [plaintiffs in Texas that] had
foreseeable effects in the forum and were directed at the forum."
Id. at 212. Dorman and Brennan's authorization and distribution of the
stolen trade secrets fit the Wien analysis for directed action. Under
Wien, Dorman and Brennan's directed actions establish sufficient
contacts with Texas to support the exercise of specific personal
jurisdiction in a case arising from those actions.

C. Dorman and Brennan argue that they should be subject to Texas law.

Dorman and Brennan have also filed a motion asking the court to
dismiss FundsXpress's claims that they have violated California law
for knowing receipt, concealment and use of stolen property. See
Defendants' Motion to Dismiss for Failure to State a Claim for Relief
Pursuant to Rule 12(b)(6) and Plaintiffs Third Amended Petition, Count
III. In their motion to dismiss, they ask the Court to dismiss the
claims made against them pursuant to California because they allege
that they are subject to Texas law. See Defendants' Motion to
Dismiss. By arguing that Texas law applies, Dorman and Brennan are
conceding that they should be subject to Texas law. It should follow
that they are subject to being sued under Texas law in Texas courts.

CONCLUSION

Due to the nature of Dorman and Brennan's tortious actions toward a
Texas Corporation intending to profit at the expense of and cause harm
to that Texas corporation in Texas, Dorman and Brennan clearly knew
and should expect to be haled into Court in Texas. This Court,
therefore, has specific personal jurisdiction over Dorman and
Brennan. FundsXpress requests that their motion be denied.


[1] Exhibit 1 is an email produced in discovery by Digital Insight and Bates numbered DIN0000111. The email, dated May 21-22, shows the various FundsXpress documents that were forwarded by Edwards and Brennan.

[2] Exhibit 2 is a true and correct copy of the transcript of
Mr. Dunn's testimony at a temporary injunction hearing in a lawsuit
filed by FundsXpress, FundsXpress Financial Network, Inc. v. Gifford
A. Dunn, Cause No. 01CV-8333 in Johnson County, Kansas.

[3] Exhibit 3 is an email from Eric Edwards to the management team of
Digital Insight, including John Dorrnan. It is a true and correct copy
of an email that was originally presented at the temporary injunction
hearing in FundsXpress Financial Network, Inc. v. Gifford A. Dunn,
Cause No. 01CV-8333 in Johnson County, Kansas.

Respectfully submitted,

R. James George, Jr.
State Bar No. 07810000
David H. Donaldson, Jr.
State Bar No. 05969700
Peter D. Kermedy
State Bar No. 11296650
Nanneska N. Hazel
State Bar No. 12813500
114 W. 7th Street, Suite 1100
Austin,Texas 78701
(512) 495-1400
(512) 499-0094 (Fax)

ATTORNEYS FOR PLAINTIFF FUNDSXPRESS FINANCIAL NETWORK, INC.

OF COUNSEL:
GEORGE & DONALDSON, L.L.P.
114 West 7th Street, Suite 1100
Austin, Texas 78701
(512) 495-1400
FAX: (512) 499-0094

WINSTEAD SECHREST & MINICK P.C.
100 Congress Ave., Suite 800
Austin, Texas 78701
(512) 474-4330
FAX: (512) 370-2850

CERTIFICATE OF SERVICE

I hereby certify that on August 14, 2002, a true and correct copy of
the foregoing was served on counsel of record as shown below:

Barry K. Bishop
Clark, Thomas & Winters, P.C.
300 W. 6th Street, Suite 1500
Austin, Texas 78701
(via Hand Delivery)

Aaron C. Gundzik
Cotton & Gundzik, L.L.P.
725 S. Figueroa St., 34th Floor
Los Angeles, CA 90017
(via Certified Mail, Return Receipt Requested)

Nanneska N. Hazel