- personal jurisdiction in federal court à. no particular provision, equivalent to international shoe, Rule 4 serves as international shoe, (provide Rule (4) as law in exam )
- Venue + corporation 1391 (c.) à. Exam
- Joinder + enjoin (federal court enjoin a suit in state court) – not in exam
Ch2. Jurisdiction over the parties or their properties p.71
- Personal jurisdiction - the power of a court to enter a judgment against a specific defendant ; in personam ; in rem ;
- (DO- subject matter jurisdiction – the power of a court to enter a judgment over a matter)
- ** A court can assert personal jurisdiction, only if (i) its power is authorized by statute and (ii) the statute does not exceed the limitation of the Due Process Clause of the Constitution.
- territorial theory
1, in personam jurisdiction
- (1) appear in the court, (consent),
o e.g. foreign company registered on the condition of doing biz there consents to be sued there ; jurisdiction when domiciled
- (2) found within the State, (presence),
o jurisdiction when served ; exception is D is in court (if D could be served while in court, it would discourage out-of-state D from appearing in court)
- (3) resident thereof, (citizenship), jurisdiction over its citizen
2, quasi in rem jurisdiction
- Jurisdiction over the value of property ; e.g enforce a lien, only to the extent of such property at the time jurisdiction attached , e.g. if debtor left a bed when moving, - to the extent of the value at full faith and credit ,
- P must attach (seize) D’s property before court can have jurisdiction
3, in rem jurisdiction
- Jurisdiction over property itself within the state’s limit,
- (1) consent ; (2) citizenship ;
- (3) presence
o 1) person
§ (i) international shoe (corporation, (DO, human being as well)),
§ (ii) burnham (human being) ,,, -
o 2) property – Shaffer ,
Pennoyer v. Neff, Supreme Court of US, 1877 (p.71)
Fact
- 1st suit – Mitchell (lawyer) v. Neff (former owner of the land), in OR state crt ;
o D (Neff, CA) was out-of-state D ; not personally served with process ; did not appear therein ; judgment was entered upon default in not answering the complaint upon a constructive service of summons by publication
- 2nd suit – Neff (to recover the possession of the land) v. Pennoyer (current owner), in OR fed crt ;
o D claims the ownership, a sale of the property on execution issued upon a judgment against Neff in the 1st suit ; P won the case
Question
- Validity of the 1st suit – in personam suit, property was not attached
o (DO- no personal jurisdiction - no full faith and credit – no res judiciata)
Rule
- no State can exercise direct jurisdiction and authority over persons or property without its territory
Here
- in 1st suit, D was not personally served with process, nor consent by appearing in court ; nor citizen ; (even if Neff had received personal notice of the action, service of process outside the state would have been ineffectual because of territorial limit of state judicial power )
- in 1st suit, P should have attached the property by the beginning of the suit
Service
- In rem – substituted service by publication is sufficient
- In personam – constructive service upon a non-resident is ineffectual ; process sent to him out of the State, and process published within it, are ineffectual, either
Full faith and credit clause
- Only when the court rendering the judgment had jurisdiction over the parties and the subject matter ; kicks in only when in different states , not in same state
Cross-action
- once personal jurisdiction, cross-action does not require additional contacts
International shoe co. v. Washington , US Supreme Court, 1945 (p.85)
- regarding in personam jurisdiction, for a (state) court to have personal jurisdiction over non-resident D (out-of-state D), Due Process requires that non-resident D have minimum contact with forum state, such that maintenance of the suit does not offend traditional notions of fair play and substantial justice (DO- the suit was brought in state court, thus, due process of the 14th kicks in, not the 5th)
-
o (1) D’s contacts with forum state - continuous & systematic v. isolated ;
o (2) relationship between cause of action and forum state - whether cause of action arises out of forum state
- ‘“Presence” of foreign corporation in state’ (for purpose of maintenance of suit against it) exists when ‘activities of corporation in state’ of forum have not only been continuous and systematic, but also give rise to liabilities sued on
o non-resident D – foreign corporation ; no consent, no citizenship, then question is presence ? ;
- ‘the casual presence of corporate agent’ or even ‘his conduct of single or isolated items of activities’ in a state in corporation's behalf are not enough to subject corporation to suit on causes of action unconnected with activities there (DO- use the phrase)
- Whether due process of law is satisfied in suit in state court against foreign corporation must depend upon quality and nature of corporation's activity in relation to fair and orderly administration of laws which it was purpose of due process clause to insure
- The service of process within state ‘upon foreign corporation's agent’ whose activities established corporation's presence in state was sufficient notice of the suit
Gray v Corp., 22 Ill. 2d 432, p.93
- A personal injury suit was brought (in IL court) against several Ds, including D foreign corporation, alleging that a water heater exploded and injured P ; the D foreign corporation had negligently constructed the safety valve, and that P's injuries were suffered as a proximate result thereof
- The D foreign corporation argued that it had not committed a tortious act in IL ; no business in IL ; it sold the completed valves to a co-D outside IL
o D foreign corporation ; no consent no citizenship, question is presence? ; two prong test, D argue, (i) contact with forum state - no biz in forum state , (ii) cause of action not rise in forum state
Held
- the IL long arm statute does not violate due process ; the D foreign corporation had sufficient contacts with IL (forum state) to provide jurisdiction because the foreign corporation elected to sell its product for ultimate use in that state
Reasoning
- place of wrong is the last place where the event (rendering D liable) takes place
- “Tortious act”, within (long arm) statute providing that nonresident who commits tortious act within state submits to its jurisdiction, was committed in IL where water heater exploded in IL as result of alleged defect in safety valve manufactured in OH and incorporated in PA into heater which was sold to IL consumer
- If corporation elects to sell its products for ultimate use in another state, it is answerable in state in which products are used for any damage caused by defects.
o Put its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum state
- ( once an item has been put into the stream of commerce, then that item becomes your agent for service of process )
McGee v. International Life Ins. Co., 355 U.S. 22, p.100
- The beneficiary obtained a judgment against the insurer in a CA state court and attempted to enforce it in TX state courts
- The TX courts refused to enforce the CA judgment, holding that the judgment was void under the Fourteenth Amendment because service of process outside CA could not give the CA court jurisdiction over the insurer (DO- full faith and credit requires personal jurisdiction )
Held
- Due process was satisfied because the insurer had certain minimum contacts with CA (forum state) ; the CA court had personal jurisdiction over the insurer
- the suit was based on a contract that had substantial connection with CA ; the contract was delivered in CA ; the premiums were mailed from CA ; the insured was a resident of CA when he died
-
Hanson v. Denckla, 357 U.S. 235, p.101
- Facts: A family fight over the assets of Mrs. Donner, a deceased mother who had established a trust in DE and some yrs later moved to FL, where she died ; when Mrs. Donner moved to FL she received her trust income from the trustee and she carried on several bits of trust administration while living in FL ;
- Issue(s) : whether FL could acquire jurisdiction over the DE trustee and thereby award the estate to Mrs. Donner’s daughter ? Held - No, FL does not have jurisdiction
- The unilateral activity of another party or a third person cannot satisfy the requirement of D’s contact with the forum State ; the application of that rule will vary with the quality and nature of the D's activity, there (should) be some act by which the D purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws ,
o DO- the unilateral activity toward non-resident D does not satisfy minimum contact with forum state ; the D purposefully avail itself of privilege of conducting activity within the forum state
World-Wide VW. v. 444 U.S. 286, p.105
- NY residents purchased a new car from D retailer ; while driving through OK to a new home in AZ, car accident happened, causing a fire, which severely injured Ps ;
- the Ps purchasers brought a products-liability action in an OK court against D retailer, among others ;
- D retailer, which were incorporated in NY and did business in NY, entered special appearances, claiming no minimal contacts with OK
- OK state court held that personal jurisdiction was authorized by OK long-arm statute
- the Court Held the D retailer had no contacts, ties, or relations with OK .
reasoning
- Even if the D would suffer minimal or no inconvenience from being forced to litigate in the forum state ; even if the forum State has a strong interest in applying its law to the controversy ; even if the forum State is the most convenient location for litigation,, the Due Process Clause may sometimes act to divest the State of its power to render a valid judgment
- Forseeability alone has never been a sufficient benchmark for personal jurisdiction under the due process clause ; if foreseeability were the criterion, every seller of chattels would in effect appoint the chattel his agent for service of process, his amenability to suit would travel with chattel
o DO- distinction from Gray - put into the stream of commerce, “elect to sell its product for ultimate use in forum state”
Here
- Isolated occurrence, the fortuitous circumstances, ;
- not purposefully avail itself of the privilege of conducting activities within forum state ;
- Here, there is no Gray where “put its product into the stream of commerce with the expectation that they will be purchased by consumers in the forum state
- Just unilateral activity
Keeton v. Hustler Magazine, Inc., 465 U.S. 770, p.115
- New York resident brought action against magazine publisher alleging libel ; The United States District Court in New Hampshire dismissed the action
- Held that: (1) publisher's regular circulation of magazines in forum state (NY) was sufficient to support assertion of jurisdiction in action based on contents of the magazine, and same was true even if so-called “single publication rule”
- Potential unfairness in applying NH’s statute of limitation (which is longer than any other state, thus, make NH only state where P can sue) to all aspects of his nation-wide suit has nothing to do with the jurisdiction of the Court to adjudicate the claim ; coz, the issue is not personal jurisdiction , but choice of law ;
Kulko v. Superior Court of Cal., 436 U.S. 84, 117
- A suit for a child support by kids’ mom (CA citizen) against her ex-husband (NY resident) in CA court
- The couple’s two children lived with their father (ex-husband) in NY under the original separation agreement ; when the daughter told the D (ex-husband) that she wanted to live with her mom, he assented and bought her a one-way air ticket to CA ; the other kid also joined his mother in CA after receiving a one-way ticket from her, without D’s (ex-husband) knowledge
- Held : (1) acquiescence of divorced father (NY resident) in his daughter's desire to live with her mother in CA did not confer jurisdiction over divorced father in CA courts ( in divorced mother's action to establish foreign judgment of divorce and to modify such judgment so as to award her child custody ) ;
o (DO- mere acquiescence not create in personam jurisdiction ; without purposeful avaiment )
- (2) divorced father did not derive financial benefit as a result of his acquiescence in his daughter's desire to live in California with her mother so as to warrant California court's exercise of in personam jurisdiction over divorced father, and
In personam jurisdiction
- (1) D’s contacts with forum state - continuous & systematic v. isolated ;
- (2) relationship between cause of action and forum state - whether cause of action arises out of forum state
In Woodson (p.105) the minimum contact should be such that “he should reasonably anticipate being haled into the forum state”
Burger King Corp. v. Rudzewicz, 471 U.S. 462, à. See p.378 Bates, p.119
Fact
- Franchisor (who grants franchises) brought action against franchisee alleging breach of franchise obligations and trademark infringement in FL court ;
- FL court held that FL long-arm statute grants FL court personal jurisdiction over the franchisee (MI)
Held
- a party that avails themselves of the protections and benefits of the law of a forum state is subject to personal jurisdiction of that state
- the MI franchisee (D) had entered into a contract and established a substantial and continuing relationship with the FL franchisor
reasoning
- due process clause protects an individual’s liberty in not being subject to (in personam) jurisdiction of a forum state he has no minimum contact with (DO- substantive due process of 14th ?)
- forum selection clause, if freely negotiated, not unreasonable, not unjust,, their enforcement does not offend due process
- personal jurisdiction (specific jurisdiction) over a out-of-state D (foreign corporation, who not consented to the suit there), is satisfied when
o (i) “purposeful availment requirement” (as a minimum contact req.) – D has purposefully availed himself of the privilege of conducting biz in the forum state
§ = D’s activity is purposefully direct at the forum state ;
§ “purposeful availment requirement” insures that “he (D) should reasonably anticipate being haled into the forum state”
§ Whether or not the D did not physically enter the forum state
o (ii) cause of action arise out of forum state -
-
Here
- The D franchisee (MI) , negotiated with FL franchisor for purchase of a long-term franchise and manifold benefit ; entered into a carefully structured 20-year contract which envisioned continuing and wide-reaching (substantial) contacts with FL ; accepted regulation of his biz from headquarters of the franchisor in FL ; made monthly payment to the franchisor in FL
- The D franchisee (MI) deliberately reached out beyond MI ; had fair notice that he might be subject to suit in FL ; exercise of jurisdiction would not offend due process ; subject to long-arm jurisdiction in FL court in dispute arising out of the franchise arrangement
Asahi. v.., 480 U.S. 102, p.129
- a Japanese corporation (Asahi), manufactured a valve that was sold to TW corporation, who used it in the manufacture of a motorcycle tire ; when the tire exploded while the motorcycle owner was driving it in CA, the driver filed a products liability action against TW Corp. who filed a cross-complaint for indemnity against Asahi ; Asahi moved to quash the service of summons
- Held - the mere fact that Asahi knew that some of its component parts would be used in products that would be sold in the state (CA) did not provide the necessary minimum contacts for the state (CA) to exercise personal jurisdiction over Asahi, since Asahi did nothing to purposely avail itself of the privilege of conducting activities in the state CA)
Reasoning
- Substantial connection between defendant and forum state necessary for finding of minimum contacts must come about by action of defendant purposefully directed toward forum state; placement of product in stream of commerce, without more, is not such an act. (Per Justice O'Connor with the Chief Justice and two Justices concurring (ß not law, only four signed)
E,, general jurisdiction ; state long arm statute p.138
Perkins v., 342 U.S. 437,
- P, non-resident of OH, filed a suit against Ds, including incorporated foreign mining company ; P;s cause of action did not arise in OH and did not relate to the company's activities in OH (specific jurisdiction) ; however, the mining company had been carrying on a limited but continuous and systematic part of its general business in the state
-
- Held – a forum state has in personam jurisdiction over the foreign company (out-of-state D) which does continuous and systematic in-state activities in the forum state
Reasoning
-
Here
