Flux Drive v. Sparks

Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 1 FILED United States Court of Appeals PUBLISH Tenth Circuit UNITED STATES COURT OF APPEALS October 30, 2026 Christopher M. Wolpert FOR THE TENTH CIRCUIT Clerk of Court _________________________________ FLUX DRIVE INC.; FLUX DRIVE LLC; IMPACT ENGINEERING INC.; TRI-TEC MANUFACTURING LLC; PHILIP CORBIN, III, Plaintiffs - Appellants, v. Nos. 25-1308, 26-1013 & 26-1292 JOHN QIANG RONG; ZYRCON GLOBAL STRATEGIES LLP; LEIGH WANG; Defendants - Appellees, and MICHAEL TROY SPARKS; CMONSENSE DESIGN LLC; LIJUAN ZHAO, a/k/a Lora Zhao, Defendants. _________________________________ Appeals from the United States District Court for the District of Colorado (D.C. No. 1:24-CV-02784-DDD-STV) _________________________________ Steven J. Miller, The Miller Law Offices, PLC, Jacksonville, Florida, for Plaintiffs- Appellants. Christopher L. Ottele (Ruth A. Turley with him on the brief), Brownstein Hyatt Farber Schreck, LLP, Denver, Colorado, for Defendants-Appellees. _________________________________  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 2 Before MATHESON, McHUGH, and FEDERICO, Circuit Judges. _________________________________ McHUGH, Circuit Judge. _________________________________ Plaintiffs-Appellants appeal the district court’s order granting Defendants- Appellees’ motion to dismiss for lack of personal jurisdiction and two subsequent orders awarding attorneys’ fees. In the underlying action, Flux Drive, Inc. (“FDI”), Flux Drive, LLC (“FDL”), Impact Engineering, Inc. (“Impact”), Tri-Tec Manufacturing, LLC (“Tri-Tec”), and Philip Corbin III (collectively, “Plaintiffs”) allege that various individuals and entities—Defendants Michael Troy Sparks, CMONSense Design LLC (“CMONSense”), John Qiang Rong, Zyrcon Global Strategies, LLP (“Zyrcon”), Leigh Wang, and Lijuan Zhao—conspired to steal their trade secrets and transfer them to a company in China that manufactures unauthorized knockoff products. Plaintiffs sued in the District of Colorado, where Defendant Mr. Sparks is a resident. Mr. Rong, his wife Ms. Wang, and their limited liability partnership Zyrcon (collectively, “the Rong Defendants”), all Illinois residents, moved to dismiss the Amended Complaint for lack of personal jurisdiction. The district court granted the motion and dismissed the Amended Complaint as to the Rong Defendants. Plaintiffs appealed the interlocutory order dismissing the Rong Defendants in Case No. 25- 1308. The Rong Defendants then moved for attorneys’ fees under Colorado’s fee- shifting statute, which mandates an award of fees when an action is dismissed for 2  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 3 lack of personal jurisdiction. The district court granted the motion and awarded the full lodestar amount requested by the Rong Defendants. In that same order, the district court sua sponte certified its dismissal order for immediate appeal under Federal Rule of Civil Procedure Rule 54(b) and entered a final judgment dismissing the Rong Defendants and awarding fees. Plaintiffs appealed the fee award in Case No. 26-1013. The Rong Defendants later moved to supplement the fee award, seeking attorneys’ fees that they incurred after they filed their original motion. The district court granted the motion with a slight modification, and Plaintiffs appealed the supplemental fee award in Case No. 26-1292. Thus, this case involves three separate but consolidated appeals: (1) the appeal of the order of dismissal (Case No. 25-1308); (2) the appeal of the initial fee award (Case No. 26-1013); and (3) the appeal of the supplemental fee award (Case No. 26-1292). Exercising jurisdiction under 28 U.S.C. § 1291, we affirm all three district court orders. I. BACKGROUND A. Factual History 1 Plaintiffs claim that Defendants engaged in a “fraudulent scheme and conspiracy” to steal their trade secrets beginning “on or before March 2020.” App. 1 In reviewing a district court order dismissing a case for lack of jurisdiction, “[t]he allegations in the complaint must be taken as true to the extent they are uncontroverted by the defendant’s affidavits.” Rambo v. Am. S. Ins. Co., 839 F.2d 1415, 1417 (10th Cir. 1988) (quotation marks omitted). “If the parties present 3  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 4 Vol. I at 35. Some years prior, PRD Technologies, Ltd. (“PRD”), a Chinese company, entered into an agreement with Magnetic Drive Development and Venture LLC (“Magnetic Venture”), a New York limited liability company, to develop “a large power water-cooled adjustable speed drive unit.” Id. at 36–37. The unit was to be designed by FDI and sold in China, Hong Kong, and Singapore. James Pi served as a principal officer for Magnetic Venture, and Mr. Rong, an engineer by trade, acted as the technical liaison between Magnetic Venture and PRD. Mr. Rong is a limited partner of Zyrcon, an Illinois limited liability partnership; his wife, Ms. Wang, is a general partner of Zyrcon. In 2018, Mr. Rong attended several meetings at FDI’s and Tri-Tec’s offices in Washington state, where he was introduced to Plaintiffs and their employees. Plaintiffs claim that Mr. Rong learned which of their employees had access to FDI’s and FDL’s trade secrets over the course of several months. They further allege that Mr. Rong approached Mr. Sparks, a senior design engineer for FDI and Tri-Tec and the sole managing member of CMONSense, for the purpose of obtaining those trade secrets around January 2020. Mr. Rong then allegedly transmitted a “Master Services Agreement” pursuant to which Mr. Sparks provided Plaintiffs’ trade secrets to PRD through Mr. Rong. conflicting affidavits, all factual disputes are resolved in the plaintiff’s favor, and the plaintiff’s prima facie showing is sufficient notwithstanding the contrary presentation by the moving party.” Id. Accordingly, the facts in this section are drawn from the Amended Complaint and the parties’ affidavits. 4  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 5 Plaintiffs assert that Mr. Rong, Ms. Wang, and Zyrcon facilitated the scheme by providing “bridge financing” to Mr. Sparks and acting as intermediaries between him and PRD. To that end, Plaintiffs claim that the Rong Defendants transferred over $20,000 to Mr. Sparks’s Colorado bank accounts during the relevant period. The Rong Defendants tell a different story. In an affidavit, Mr. Rong admits that he met with Mr. Sparks at FDI’s offices in Washington state on three occasions. However, he asserts that their interactions all took place during group meetings. And while Mr. Rong did email with Mr. Sparks in 2020, he asserts that he did so only to provide translation services and to facilitate communication between Mr. Sparks and PRD as a favor to his friend, Lincoln Li, from PRD. Mr. Rong denies that he was an agent or employee of PRD, that he received payment from PRD, or that he had authority to negotiate the Master Services Agreement. He also states that he was unaware of whether Mr. Sparks and PRD intended to conceal their relationship. In a separate affidavit, Ms. Wang states that her only connection to Mr. Sparks was a $23,000 bridge loan that she and Mr. Rong provided to him in March 2020 on account of PRD’s delay in wiring him funds. Of that amount, $13,000 came from Mr. Rong and Ms. Wang’s personal account and $10,000 came from Zyrcon’s account. Mr. Sparks repaid the loan in full less than a month later. Ms. Wang asserts that she had no further contact with Mr. Sparks. In response, Plaintiffs submitted an affidavit from Mr. Corbin (the president and CEO of FDI and Impact, and a manager-member of FDL), excerpts of deposition testimony from Mr. Sparks and Lawrence Greenman (an employee of Mr. Pi), emails 5  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 6 between Mr. Rong and Mr. Sparks, and a bank statement from Mr. Sparks that reflected the funds transfer. Most of this evidence does not meaningfully contradict the Rong Defendants’ claims. However, Mr. Sparks did testify in a deposition that he sent the Master Services Agreement to Mr. Rong because Mr. Rong was “a person that [he] would supposedly report to.” Id. at 104. Plaintiffs contend that Mr. Sparks’s statement conflicts with Mr. Rong’s claim that he was not PRD’s employee or agent. B. Procedural History Plaintiffs sued in the District of Colorado, asserting six claims against the Rong Defendants: (1) fraudulent concealment; (2) misappropriation of trade secrets under the Colorado Uniform Trade Secrets Act (“CUTSA”), Colo. Rev. Stat. §§ 7-74-101 to -110; (3) violation of the Defend Trade Secrets Act (“DTSA”), 18 U.S.C. §§ 1836, et seq.; (4) civil conspiracy; (5) unjust enrichment; and (6) conversion. Soon after the lawsuit was filed, the Rong Defendants moved to dismiss the Amended Complaint for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). In support, Mr. Rong and Ms. Wang submitted affidavits stating that they are Illinois residents, that Zyrcon is an Illinois limited liability partnership, and that neither they nor Zyrcon have ever been present, owned property, maintained accounts, or conducted business in Colorado. Mr. Rong attested that he only facilitated communication between PRD and Mr. Sparks and never contracted with or worked for either entity. And Ms. Wang declared that her only involvement with Mr. Sparks was providing him the bridge loan on PRD’s behalf. 6  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 7 Upon referral from the district court, the magistrate judge recommended granting the motion to dismiss, concluding that even if the Rong Defendants’ “limited communications” with Mr. Sparks were sufficient to show minimum contacts with Colorado, Plaintiffs “have not demonstrated that their injuries arose out of the [Rong] Defendants’ forum-related activities.” App. Vol. III at 13. With respect to the bridge loan, the magistrate judge noted that “Plaintiffs have failed to explain how that loan enabled [Mr.] Sparks (or anyone else) to steal Plaintiffs’ trade secrets.” Id. Next, regarding Mr. Rong’s communications with Mr. Sparks, the magistrate judge reasoned that the Amended Complaint’s “conclusory assertions fail to explain factually how the Master Service[s] Agreement facilitated the theft of Plaintiffs’ trade secrets let alone how the [Rong] Defendants’ limited communications regarding the Master Service[s] Agreement facilitated that theft.” Id. (alteration in original). He concluded, “[t]he Complaint’s allegations concerning the [Rong] Defendants are so conclusory that the [c]ourt cannot tell what they are supposed to have done, let alone how what they did harmed Plaintiffs.” Id. Accordingly, the magistrate judge determined that Plaintiffs failed to establish personal jurisdiction over the Rong Defendants and recommended that the motion to dismiss be granted. Although Plaintiffs objected to the recommended disposition, asserting that they had pleaded sufficient facts to establish specific personal jurisdiction, the district court overruled their objections, adopted the recommendation, and dismissed the Rong Defendants from the action on July 11, 2025. Plaintiffs appealed on August 8, 2025. 7  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 8 The Rong Defendants then moved for an award of $114,663.11 in attorneys’ fees under Colo. Rev. Stat. § 13-17-201. Plaintiffs opposed the motion, arguing that the requested fees were excessive and that § 13-17-201 did not apply because the claims against the Rong Defendants were predominantly statutory in nature, not tort based. In their reply, the Rong Defendants increased their requested amount to $163,321.40, noting that they expended an additional $48,658.29 in litigating the fee motion. The magistrate judge recommended granting the motion in the amount originally requested, concluding that § 13-17-201 applied to both common law and statutory torts and that all of Plaintiffs’ claims sounded in tort. Turning to the calculation of the award, the magistrate judge “reviewed the affidavit and detailed hourly accounting submitted by the [Rong] Defendants” and concluded that the hours expended and rates charged were reasonable. Appellants’ Suppl. App. at 153. He therefore found that the Rong Defendants “adequately established the reasonableness of the $114,663.11 in attorneys’ fees sought” and recommended granting in full the Rong Defendants’ requested attorneys’ fees. Id. at 156. The magistrate judge did not address or comment on the additional $48,658.29 in fees mentioned in the Rong Defendants’ reply. Plaintiffs objected on the sole basis that the fee motion was premature because the dismissal order was not yet a final judgment. Acting sua sponte, the district court certified its dismissal order as final under Rule 54(b) and entered an amended final judgment the following day. The district court concluded that these steps mooted 8  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 9 Plaintiffs’ objections and adopted the recommendation on December 10, 2025. Plaintiffs appealed on January 9, 2026. The Rong Defendants next moved to supplement their fee award, seeking an additional $70,828.07 for fees incurred after they had filed their original fee motion. Plaintiffs again argued that § 13-17-201 did not apply. They also claimed that the initial fee award constituted an implicit denial of all other fees, that the requested fees were unreasonable, and that the district court could not award supplemental fees because it did not reserve jurisdiction to do so. With a slight modification, the magistrate judge recommended granting the supplemental fee motion. He rejected Plaintiffs’ arguments that the initial fee award implicitly denied the supplemental fees, noting that the district court had never ruled on those fees. The magistrate judge did, however, exclude the Rong Defendants’ requested 2.5% administrative fee, resulting in a recommended supplemental fee award of $68,990.50. The district court adopted the magistrate judge’s recommendation over Plaintiffs’ objections on July 1, 2026. Notably, the court rejected Plaintiffs’ contention that it had implicitly denied the additional fees in its initial award, and it further stated that the applicability of § 13-17-201 had already been resolved with respect to the initial fee award. Plaintiffs appealed on July 22, 2026. II. DISCUSSION Our analysis proceeds in three parts that correspond to the three appeals consolidated in this opinion. First, we consider Plaintiffs’ challenge in Case No. 25- 9  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 10 1308 to the district court’s order dismissing the Rong Defendants. Second, after determining that the district court correctly found that personal jurisdiction was lacking as to the Rong Defendants, we consider Plaintiffs’ challenge in Case No. 26- 1013 to the initial fee award. We begin by addressing whether the district court properly applied § 13-17-201. Then, concluding that it did, we address whether the amount of the award was justified. Finally, we review the propriety and reasonableness of the supplemental fee award as challenged in Case No. 26-1292. Ultimately, for the reasons we now explain, we affirm all three of the district court’s orders. A. Order of Dismissal: Case No. 25-1308 Plaintiffs appeal the district court’s dismissal order, making three principal arguments. First, they assert that they made a prima facie showing that Colorado has specific personal jurisdiction over the Rong Defendants. Second, they claim that the district court’s failure to hold an evidentiary hearing on the specific jurisdiction issue warrants reversal. And third, they contend that we should remand the case with instructions for the district court to allow Plaintiffs to amend the Amended Complaint pursuant to Federal Rule of Civil Procedure 15 if we determine that the dismissal order is not a final and appealable order. Because we are unpersuaded by Plaintiffs’ arguments, we affirm the dismissal order. 2 2 Under the firm waiver rule, “a party who fails to make a timely objection to the magistrate judge’s findings and recommendations waives appellate review of both factual and legal questions.” Morales-Fernandez v. INS, 418 F.3d 1116, 1119 (10th Cir. 2005). Here, although Plaintiffs ostensibly objected to the magistrate judge’s 10  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 11 1. Jurisdiction The district court entered an order on July 11, 2025, granting the Rong Defendants’ motion to dismiss for lack of personal jurisdiction under Rule 12(b)(6). Plaintiffs filed a notice of appeal on August 8, 2025, which was premature because the order dismissing the Rong Defendants was not a final appealable order under Rule 54(b). But the district court certified the dismissal of the Rong Defendants as a final judgment on December 11, 2025. Whether or not a party disputes the Rule 54(b) certification itself, it remains “the duty of the federal court to determine the matter sua sponte.” Okla. Tpk. Auth. v. Bruner, 259 F.3d 1236, 1241 (10th Cir. 2001) (quotation marks omitted). This court may exercise jurisdiction over “all final decisions of the district courts.” 28 U.S.C. § 1291. For purposes of expediency, Rule 54(b) relaxes traditional notions of finality by permitting district courts to “direct entry of a final judgment as to one or more, but fewer than all, claims or parties” upon an express determination that there is no just reason for delay. Fed. R. Civ. P. 54(b). Thus, the rule permits immediate appellate review on specific claims or a subset of the parties before the entire action has concluded. See Okla. Tpk. Auth., 259 F.3d at 1241. recommendation, they were required to raise objections “sufficiently specific to focus the district court’s attention on the factual and legal issues that are truly in dispute.” United States v. B.N.M., 107 F.4th 1152, 1168 (10th Cir. 2024) (quotation marks omitted). Their objections fell far short of that obligation, merely summarizing the facts and gesturing at allegations that look to support jurisdiction. However, we have previously determined that parties may waive or forfeit application of the firm waiver rule itself. See Hicks v. Franklin, 546 F.3d 1279, 1283 n.3 (10th Cir. 2008). The Rong Defendants failed to invoke the firm waiver rule in their briefing. Accordingly, we exercise our discretion to decide Plaintiffs’ appeal of the dismissal order on separate grounds. 11  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 12 But a Rule 54(b) order may be entered only “when a district court adheres strictly to the rule’s requirement that a court make two express determinations.” Id. That is, the district court must find “that the order it is certifying is a final order” and “that there is no just reason to delay review of the final order until it has conclusively ruled on all claims presented by the parties to the case.” Id. The first determination is reviewed de novo, while the second determination is reviewed for abuse of discretion. See id. First, the district court correctly concluded that its dismissal order was “final with respect to Plaintiffs’ claims against” the Rong Defendants. Appellants’ Suppl. App. at 212. It is readily apparent that a dismissal for lack of personal jurisdiction constitutes a final order as to those dismissed. See Butler v. Daimler Trucks N.A., LLC, No. 2:19-CV- 2377, 2021 WL 492427, at *2 n.13 (D. Kan. Feb. 10, 2021) (unpublished) (collecting cases). And second, the district court did not abuse its discretion in finding that “[a] Rule 54(b) certification of the[] jurisdictional dismissals efficiently administers justice,” particularly given that the issues involved are fairly narrow and distinct from the merits. Appellants’ Suppl. App. at 214; see also Butler, 2021 WL 492427, at *2 (“Rule 54(b) certification may be appropriate in certain cases where some, but not all, defendants are dismissed for lack of personal jurisdiction and the jurisdictional questions are independent of the merits of the underlying claims, because certification may resolve jurisdictional issues at the outset of the litigation and obviate the need for a second trial.” (internal quotation marks omitted)). Thus, because the district court’s July 11, 2025, order was properly certified as final, Plaintiffs’ premature notice of appeal has ripened and is now properly before this 12  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 13 court under 28 U.S.C. § 1291. See Lewis v. B.F. Goodrich Co., 850 F.2d 641, 645 (10th Cir. 1988) (“[When an] appellant obtains a [Rule] 54(b) certification after the notice of appeal was filed, we will deem the notice of appeal to ripen as of the date of certification and will accept the jurisdiction . . . .”); see also B. Willis, C.P.A., Inc. v. BNSF Ry. Corp., 531 F.3d 1282, 1295 (10th Cir. 2008) (“The district court’s final decision . . . ripened [the appellant’s] prematurely filed notice of appeal.”). 2. Standard of Review and Legal Background When a district court finds personal jurisdiction “wanting on the basis of the complaint and affidavits, our review of the district court’s dismissal is de novo, taking as true all well-pled (that is, plausible, non-conclusory, and non- speculative . . . ) facts alleged in plaintiffs’ complaint.” Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1070 (10th Cir. 2008) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 554–56 (2007)). Similarly, any factual disputes in the parties’ affidavits must be resolved in the plaintiff’s favor. See FDIC v. Oaklawn Apartments, 959 F.2d 170, 174 (10th Cir. 1992). Crucially, the plaintiff bears the burden of establishing personal jurisdiction over the defendant. See OMI Holdings v. Royal Ins. Co. of Can., 149 F.3d 1086, 1091 (10th Cir. 1998). However, this burden is a light one at the preliminary stages of litigation. See Wenz v. Memery Crystal, 55 F.3d 1503, 1505 (10th Cir. 1995). When an evidentiary hearing has not been held, the plaintiff need only present competent proof in the form of affidavits and other written materials that, if true, would make a prima facie case that jurisdiction is proper. See id. 13  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 14 In deciding “whether a federal court has personal jurisdiction over a defendant, the court must determine (1) whether the applicable statute potentially confers jurisdiction by authorizing service of process on the defendant and (2) whether the exercise of jurisdiction comports with due process.” Trujillo v. Williams, 465 F.3d 1210, 1217 (10th Cir. 2006) (internal quotation marks omitted). The DTSA does not provide for nationwide service of process that would confer personal jurisdiction over all Defendants in the present case. See 18 U.S.C. § 1836; see also Mission Measurement Corp. v. Blackbaud, Inc., 287 F. Supp. 3d 691, 706 (N.D. Ill. 2017). Thus, “[Federal Rule of Civil Procedure] 4(k)(1)(A) commands the district court (and us) to apply the law of the state in which the district court sits.” Dudnikov, 514 F.3d at 1070; Fed. R. Civ. P. 4(k)(1)(A). In Colorado, personal jurisdiction is governed by the state long-arm statute, Colo. Rev. Stat. § 13-1-124(1), which was intended to extend the jurisdiction of Colorado courts to the fullest extent permitted by the Due Process Clause of the Fourteenth Amendment. See Archangel Diamond Corp. v. Lukoil, 123 P.3d 1187, 1193 (Colo. 2005). As a result, “the first, statutory, inquiry effectively collapses into the second, constitutional, analysis.” Dudnikov, 514 F.3d at 1070. “[T]o exercise jurisdiction in harmony with due process, defendants must have ‘minimum contacts’ with the forum state, such that having to defend a lawsuit there would not ‘offend traditional notions of fair play and substantial justice.’” Id. (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). Adequate minimum contacts to establish specific personal jurisdiction exist where (1) “the 14  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 15 defendant has purposefully directed its activities toward the forum jurisdiction” and (2) “the underlying action is based upon activities that arise out of or relate to the defendant’s contacts with the forum.” 3 Trujillo, 465 F.3d at 1218 (quotation marks omitted). To determine whether purposeful direction exists “[i]n the tort context, we often ask whether the nonresident defendant purposefully directed its activities at the forum state.” Dudnikov, 514 F.3d at 1071 (internal quotation marks omitted). Purposeful direction is found where there is “an intentional action . . . expressly aimed at the forum state . . . with . . . knowledge that the brunt of the injury would be felt in the forum state.” Id. at 1072. A defendant’s “‘random, fortuitous, or attenuated’ contacts” are insufficient for jurisdiction. Anzures v. Flagship Rest. Grp., 819 F.3d 1277, 1280 (10th Cir. 2016) (quoting Walden v. Fiore, 571 U.S. 277, 286 (2014)). With respect to the requirement that the plaintiff’s injuries arise out of the defendant’s forum-related activities, we look to whether “the defendant’s suit-related conduct . . . create[s] a substantial connection with the forum [s]tate.” Id. (quoting 3 Minimum contacts may also be established by a showing of general jurisdiction based on a nonresident “defendant’s ‘continuous and systematic’ general business contacts with the forum state.” Trujillo v. Williams, 465 F.3d 1210, 1218 n.7 (10th Cir. 2006) (quoting Helicopteros Nacionales v. Hall, 466 U.S. 408, 415 (1984)). Plaintiffs do not argue on appeal that the Rong Defendants are subject to general personal jurisdiction, nor does anything in the Amended Complaint indicate that the Rong Defendants were engaged in systematic and continuous activity in Colorado. We therefore consider only whether Plaintiffs have made a prima facie showing of specific personal jurisdiction. 15  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 16 Walden, 571 U.S. at 284). “[T]he relationship between a defendant and the forum [s]tate ‘must arise out of contacts that “the defendant himself” creates with the forum [s]tate,’ and those contacts must be ‘with the forum [s]tate itself, not the defendant’s contacts with persons who reside there,’ such as a plaintiff.” Id. (quoting Walden, 571 U.S. at 285). This requirement ensures that “an adequate connection exists between the forum and the underlying controversy.” Dental Dynamics, LLC v. Jolly Dental Grp., LLC, 946 F.3d 1223, 1229 (10th Cir. 2020). Ultimately, “[d]ue process requires that a defendant be haled into court in a forum [s]tate based on his own affiliation with the [s]tate, not based on the ‘random, fortuitous, or attenuated’ contacts he makes by interacting with other persons affiliated with the [s]tate.” Anzures, 819 F.3d at 1280–81 (quoting Walden, 571 U.S. at 286). After the plaintiff establishes a prima facie case of specific personal jurisdiction, the defendant may defeat that case by making a “compelling case” that other considerations render jurisdiction unreasonable. OMI Holdings, 149 F.3d at 1091 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985)). Specifically, any exercise of “personal jurisdiction . . . must always be consonant with traditional notions of fair play and substantial justice.” Dudnikov, 514 F.3d at 1071 (citing Int’l Shoe, 326 U.S. at 316). Thus, the relevant question is “whether a district court’s exercise of personal jurisdiction over a defendant with minimum contacts is ‘reasonable’ in light of the circumstances surrounding the case.” OMI Holdings, 149 F.3d at 1091. 16  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 17 3. Minimum Contacts As discussed, the minimum contacts necessary to support specific personal jurisdiction requires both that the defendant purposefully directed activities toward the state and that the relevant injury arose out of those activities. As we now explain, Plaintiffs have made a threshold showing to satisfy the first requirement. But they have failed to allege that the injuries of which they complain arose out of those purposeful contacts. a. Purposeful direction Plaintiffs identify two discrete contacts between the Rong Defendants and Colorado that they contend are sufficient to establish purposeful direction: (1) Mr. Rong acted in a “supervision and liaison role” over Mr. Sparks’s “misappropriation activities conducted in Colorado”; and (2) the Rong Defendants transferred $23,000 to Mr. Sparks’s Colorado bank account “to fund a high-power CAD workstation and software, which [Mr.] Sparks purchased within four days and used from Colorado to misappropriate Plaintiffs’ trade secrets.” Appellants’ Br. at 12. Plaintiffs contend that they produced sufficient evidence to show purposeful direction based on these two contacts and argue that the district court erred by discounting the evidence they produced. Id. at 13. In support of their contention that Mr. Rong played a supervisory role to Mr. Sparks, Plaintiffs point to the following record evidence: • Sworn declarations of [Mr.] Corbin describing [Mr.] Rong’s ongoing technical and supervisory role. 17  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 18 • [Mr.] Sparks’ deposition testimony that he was told he would “report to” [Mr.] Rong. • Contemporaneous emails between [Mr.] Corbin and [Mr.] Rong addressing design details, schedules, testing, and production. • Independent corroboration by non-party Larry Greenman identifying [Mr.] Rong as an engineering decision-maker. Reply Br. at 2 (citations omitted). And in support of their contention that the Rong Defendants wired money to Mr. Sparks to facilitate his theft of Plaintiffs’ trade secrets, Plaintiffs point to bank records showing that $23,000 was wired to Mr. Sparks’s account from the Rong Defendants. Plaintiffs argue that the district court “ignored the pleaded context and causal chain alleged here and prematurely rejected [the] specific sworn facts that must be credited at this stage” of the litigation. Appellants’ Br. at 12–13. For their part, the Rong Defendants contend that neither of the alleged interactions between themselves and Mr. Sparks constitutes purposeful availment. Instead, they argue that the emails to Mr. Sparks and the wiring of funds were “[s]hort-lived, non-commercial favors,” as opposed to “jurisdictionally significant” activities that created a “contractual tie, duty, or performance obligation in Colorado.” Appellees’ Br. at 16–17. They further contest Plaintiffs’ characterization of the record evidence regarding both Mr. Rong’s role as a supervisor and the description of the alleged bridge loan to Mr. Sparks. They argue that the portions of the record cited by Plaintiffs do not support their descriptions of the Rong Defendants’ contacts with Colorado. In particular, they make the following points: 18  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 19 • The emails that Plaintiffs cite show only . . . Mr. Rong’s facilitation of the [Master Services Agreement]’s execution, not Mr. Sparks ‘reporting to’ him. • [Mr.] Corbin’s declaration stating that Mr. Rong had technical knowledge has no bearing on the existence of a supervisory relationship. • A non-party referring to Mr. Rong as “Dr. Rong,” but admitting to being unsure “[e]xactly what Dr. Rong’s role in all of this was” has no bearing on the existence of a supervisory relationship. • Defendant Sparks’s deposition comment that “[Mr.] Rong was supposed to be a person that I would supposedly report to” similarly fails. The statement is doubly qualified by “supposed” rendering it speculative and unsupported by firsthand knowledge. Plaintiffs cannot infer jurisdiction from a conclusory allegation of a single deponent about a hypothetical relationship that never existed. Id. at 18–19 (citations omitted). With respect to the bridge loan paid to Mr. Sparks, the Rong Defendants assert that they “neither directed the funds to Colorado commerce nor sought any Colorado-based benefit, and they exercised no control and had no knowledge of their use.” Id. at 16. The Rong Defendants’ alleged contacts satisfy the first part of our minimum contacts inquiry. That is, Plaintiffs have adequately established that the Rong Defendants purposefully directed their activities toward Colorado. At this early stage of the litigation, we must take the well pleaded allegations as true, but only “to the extent they are uncontroverted by the defendant’s affidavits.” Wenz, 55 F.3d at 1505 (quotation marks omitted). Thus, we cannot credit bare allegations in the Amended Complaint to the extent they are controverted by the Rong Defendants’ affidavits. See id. However, “[i]f the parties present conflicting affidavits, all factual disputes must be resolved in the plaintiff’s favor.” Id. 19  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 20 Here, Plaintiffs did produce some evidence showing that the Rong Defendants directed activities at the forum state. Specifically, Mr. Rong repeatedly sent email communications to Mr. Sparks, who he knew resided in Colorado. In a deposition, Mr. Sparks stated that Mr. Rong “was supposed to be a person that [he] would supposedly report to” in his role at PRD. App. Vol. I at 104. Although this statement is somewhat equivocal, it is enough at this stage to support the existence of a supervisory relationship between Mr. Sparks and Mr. Rong. Further, because Mr. Sparks had personal knowledge of his involvement in the relationship and negotiations with PRD, he was not merely speculating on the existence of the relationship. And although he qualified his answer with “supposed to be” and “supposedly,” id., “that equivocation goes to the weight of the testimony,” which is a question for the jury, see Hafen v. Howell, 121 F.4th 1191, 1207 (10th Cir. 2024). Finally, it is undisputed that the Rong Defendants wired $23,000 to Mr. Sparks’s Colorado bank account. To be sure, none of this evidence shows a continuous relationship between the Rong Defendants and the forum state, but “[s]o long as it creates a ‘substantial connection’ with the forum, even a single act can support jurisdiction.” Burger King, 471 U.S. at 475 n.18 (quoting McGee v. Int’l Life Ins. Co., 355 U.S. 220, 223 (1957)); see also Rambo v. Am. S. Ins. Co., 839 F.2d 1415, 1418 (10th Cir. 1988) (“In proper circumstances, even a single letter or telephone call to the forum state may meet due process standards.”). 20  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 21 b. Arising out of Plaintiffs, however, have not satisfied the second part of the specific personal jurisdiction inquiry. Although they have identified sufficient contacts to establish purposeful direction, they have not shown that their injuries arose out of or related to the Rong Defendants’ forum-related activities. Plaintiffs first allege that Mr. Rong, acting as an agent for PRD, aided Mr. Sparks’s theft of their trade secrets by providing him with the Master Services Agreement. But they fail to explain how Mr. Rong’s communication with Mr. Sparks facilitated the alleged theft. See Newsome v. Gallacher, 722 F.3d 1257, 1271 (10th Cir. 2013) (“The import of the ‘arising out of’ analysis is whether the plaintiff can establish that the claimed injury resulted from the defendant’s forum-related activities.”). Likewise, they fail to identify any part of the Master Services Agreement that enabled the alleged misappropriations. See id. The Master Services Agreement is an independent contractor agreement between PRD and Mr. Sparks in which Mr. Sparks agreed to perform certain design and development work for PRD in exchange for compensation. It makes no mention of Plaintiffs, Plaintiffs’ technologies, or Mr. Rong. Thus, as the magistrate judge observed, “[i]t is entirely unclear from the Complaint how the Master Services Agreement enabled [Mr.] Sparks to misappropriate Plaintiffs’ trade secrets.” App. Vol. III at 3 n.3. To be sure, Plaintiffs attempt to contradict Mr. Rong’s claim that his role was merely that of a translator. Specifically, they cite Mr. Corbin’s declaration which asserts that, beginning in August 2018, Mr. Rong “was directly involved as a liaison 21  Appellate Case: 25-1308 Document: 82-1 Date Filed: 10/30/2026 Page: 22 on all technical matters for the project between [P]laintiffs and the ultimate customer,” and t