CASE BRIEFS In order discussed

Pennoyer v. Neff (S.Ct. 1878)

Foundation for Civil Procedure; Supreme Court defines what Due Process requires (that receive notice and that the judgment rendered be by a court that has jurisdiction over and subject matter) RULE: SOP on within the state territorial boundaries gives in personam jurisdiction.

Facts/ Procedural Posture: Mitchell v. Neff Mitchell sues Neff (Oregon resident, whereabouts unknown) in Oregon to recover attorneys fees Neff owes to Mitchell Publishes SOP in local Oregon newspaper (allowed by Oregon law if is a non-resident and owns property within the state) Neff doesnt show default judgment; to pay Mitchell, court orders for Neffs property to be seized and sold in Sheriffs auction Property is sold to Pennoyer Neff has one year to contest the judgment Neff doesnt want to sue Mitchell (only recovers debt owed), but Pennoyer (recovers property, worth much more)direct attack (was judgment wrong?) o Neff would only recover debt in state court, because state courts must give FFC to other state court judgments unless the judgment is invalid Neff sues in Federal courtcollateral attack (was judgment invalid?) Trial court rules in favor of Neff, claiming Oregon court did not have jurisdiction over Neff b/c Neff wasnt a resident (in Mitchells affidavit)

Issue:

Did Oregon court have jurisdiction over Neff so that judgment is valid?

Holding: No. State did not have jurisdiction, so judgment was not valid. (Neff not resident; given notice, but court did not have authority to exercise jurisdiction) Affidavit error doesnt attack validity of judgment should be brought up in direct attack If Mitchell had attached the property at the outset, the court would have had in rem jurisdiction and the judgment wouldve been valid. o This was required by the state statute SOP: Notice + Order to Appear o Purpose is to give notice to and establish states authority We now have 3 ways to establish jurisdiction: o In personam jurisdiction SOP of within the state (state is sovereign within territorial boundaries) Voluntary appearance and participation in the proceedings o In rem jurisdiction over property a state has power over the land within its boundaries; can be used to adjudicate disputes pertaining to the property or pertaining to debt Quasi in rem proceedings are brought against the personally, yet it is the s interest in his property that serves as the basis for jurisdiction (ex. Creditor collecting money from debtor); requires attachment of the property (in order for the state to exercise its dominion over the property) o Attachment of property is the equivalent of SOP on ; gives court authority and gives notice to because in theory it would come to the attention of its owner (contact); State may then inquire if owner has a debt and sell property to pay the debt

Hess v. Pawloski (S.Ct. 1927) Established that state regulation of jurisdiction is constitutional, including SOP on agent RULE: state has power to declare that non-motorists impliedly consent to states jurisdiction when driving on states highways

Procedural Posture: Facts: Hess (Pennsylvania resident) Pawloski (Massachusetts resident) While driving on highway in Massachusetts, Hess hit Pawloski According to state statute in Mass., SOP on Registrar of Motor Vehicles is equivalent to SOP on himself o Statute based on implied consent, that if motorist drives a car on Mass roadways, motorist implicitly consents to jurisdiction of that state (Supreme Court is only worried about the Due Process issue) Jury in trial court found for Pawloski Mass Supreme Court affirmed Appeal to S.Ct.

Issue: Holding:

Does Mass. Statute granting jurisdiction over a non-resident motorist by SOP on agent violate the Due Process clause of the 14th amendment?

No. When theres agency, its understood to be a voluntary agreement between principal and agent. This doesnt work hereeven though the Mass court says theres implied consent from the , there is no voluntary agreement which can be retracted. Thus, no real implied consent (fictional). In reality, they are asserting that a state is imposing an obligation on a non-resident. The obstacle here is the Privileges and Immunities clause of the Constitutionguarantees rights to nonresidents to travel through other states, limits states power to interfere The court justifies jurisdiction here because they find automobiles to be dangerous instrumentalities, noting that tortfeasors now have greater mobility (Public Interest: Mass is protecting its residents from auto accidents) triggers power of police force non-residents are equally accountable (and more careful drivers) as residents and can compensate residents through litigation Satisfying Pennoyers principle of sovereignty by SOP on agent (= SOP on ) within the state

HYPO: 1) If Hess was driving a commercial truck, and Pawloski also wanted to sue Hesss employer, is it possible for him to do so? Yes. Employer becomes responsible for employees torts (Tort law). A court gets personal jurisdiction through the agency of the employer; the employer is ultimately responsible for the acts of its agent (employee). 2) Hess swerved to avoid Pawloski. Pawloski was so enraged that Hess almost hit him that he got out of his car and punched Hess. Could state assert jurisdiction by serving the Registrar? No only if the person used the highway and if the statute was expanded to include any cause of action.

Milliken v. Meyer (S.Ct. 1940) An individuals domicile becomes a basis for in personam jurisdiction, allowing out of state substituted SOP on domiciliary. RULE: SOP on domiciliary of state may be made on even if he is out of state

Procedural Posture: (multiple law suits) MILLIKEN v. Meyer Meyer received SOP in Colorado pursuant to a Wyoming statute that stated that domiciliaries could be served out of state. Meyer didnt show up for the proceedings because he claims that Wyoming doesnt have jurisdiction over him since he was served in Colorado. The court ruled in favor of Milliken. Meyer discovered this when he stopped receiving the interest checks. MEYER v. Milliken Meyer sues Milliken in Colorado in a collateral attack because he wants his money back. He claims the original judgment was invalid based on jurisdiction (Pennoyer). The Colorado court did not give the Wyoming judgment FFC and ruled the judgment to be invalid based on the merits (disagreed with facts of Wyoming court) rather than jurisdiction. Facts: Issue: Holding: Yes. Rules in favor of MillikenColorado was not allowed to pass judgment on Wyomings decision but only if the judgment was valid (based on jurisdiction). Jurisdiction here is valid and based on domicile. o Domicile v. Residence One may have many residences in many states but only domiciled in one state (begins with state where you are born). Because of the privileges and rights given to citizens of a state, the citizens in return has obligations this relationship is basis for in personam jurisdiction and so the court make make SOP out of state Can a be served in a state other than the forum when the is domiciled in the forum? Milliken sued Meyer (a Wyoming resident) in Wyoming charging conspiracy in dividing oil interests. He wants to recover his interest. Meyer claims that Wyoming has no jurisdiction over him because he was served in Colorado. Milliken sues Meyer in Supreme Court alleging that Colorado didnt give the Wyoming courts judgment FFC.

International Shoe Co. v. State of Washington (S.Ct. 1945) Supreme Court attempts to expand notion of personal jurisdiction based on presence of an individual within a states borders (Pennoyer) to include personal jurisdiction of corporations based on their MINIMUM CONTACTS with the forum state (ends up with a new basis of personal jurisdiction) RULE: A state may obtain personal jurisdiction over a corporation which has minimum contacts with that state that make the exercise of jurisdiction comport with traditional notions of fair play and substantial justice

Procedural Posture: Facts: International Shoe Co. () is domiciled (where they are incorporated) in Delaware; their offices are in Missouri. State of Washington asserts that International Shoe did not pay the unemployment fund for the years that it sent employees into the state o Washington state statute: All employers in the state of Washington must pay some amount to the state unemployment fund. If not, the state has jurisdiction over them and can serve them by mailing notice to last listed address or by SOP within the state. For several years, Int. Shoe sent salesmen on commission to the state of Washington where the salesmen (agents) rented store fronts and solicited orders for shoes but did not make any direct sales. They did this deliberately. Trial, Appellate, and Wash. Supreme Court ruled in favor of

Issue: Holding: Yes. Problem with Corporations: they are legal fictions they may always be sued in their state of domicile Corporations are present within a state through what it does in the state. If its activity makes it present SOP jurisdiction Int. Shoe engaged in continuous and systematic activity, and consistently derived benefits from the State. Court uses the phrase doing businessthe cause of action here arises out of Int. Shoes presence, doing business, within the state o How much business is enough business to make a corporation present? Court looks to: the quality and nature of the activity o Court asks this question to avoid violating traditional notions of fair play and substantial justice Fairness factors: benefits and protections derived from forum Note: the Immunities and Privileges clause doesnt apply to corporations Does Int. Shoes activities in Washington make it subject to Washingtons courts?

Smyth v. Twin State Improvement Corporation (Vt. S.Ct. 1951) Singular torts become basis of jurisdiction when tort arises out of s contacts with the forum state RULE: If jurisdiction is based on enjoying privileges and protection of the forum, then it is reasonable to require the to return to the state to litigate if the activity in the forum gives rise to a cause of action

Procedural Posture: Facts: Vermont resident Massachusetts Roofing Company Roofer repaired roof, and alleged that the repairs caused roof to leak. wants to sue in Vermont. Vermont statute: says if such foreign corporation commits a tort in whole or in part in Vermont against a resident of Vermont, such acts shall be deemed to be doing business in Vermont by such foreign corporation, and there is implied consent to SOP on the Secretary of State jurisdiction Trial court dismissed claim on factual matters, but also said there was no jurisdiction; appeals

Issue: Holding: No. Vermonts statute is circularin order to prove that there was a tort, you must have jurisdiction 1. Instead, Court interprets the statute to mean that Vermont asserts jurisdiction over all s who are alleged to have committed acts which may give rise to tort liability (looks at activity). (Now applies to ) 2. Court determines if the application of the statute violates due process; looks at activity and fairness factors: o Benefits to / Burdens to Presence in VT was voluntary as was s choice to act, derived benefits Burden on to go from Mass to VT is minimal, considering he came there already to do business. o Burden on the Evidence is IN Vermont Law of Vermont will judge s liability o Vermonts interest Under Vermont statute, does jurisdiction over Twin State for committing a tort in Vermont violate Due Process?

HYPO: Smyth (Vt. Resident) goes to Massachusetts to buy shampoo from Twin States. Smyth returns home, uses product, and goes bald. Smyth sues in Vermont. Can Vermont get jurisdiction over Twin States? No. She went to Mass and did business in Mass.

McGee v. International Life Insurance Co. (S.Ct. 1957) Focus of Personal Jurisdiction is on the fairness (qualitative measure) of minimum contactsfirst time S.Ct. decides on this (Smyth was Vt. Case) RULE: A state can assert personal jurisdiction over a when the cause of action arises out of a single contract with forum resident and derived benefit from relating activity

Procedural Posture: wins on default judgment in CA o Note: Intl doesnt defend in CA because losing on the merits isnt a big deal when theres a jurisdictional issue. At this point, there is no basis for jurisdiction arising out of a single contract, so it would be better for them to avoid appearing in court and contest jurisdiction later. tries to enforce suit in TX (FFC) but TX courts refuse to enforce claiming CAs exercise of jurisdiction was improper appeals TX decision to US Supreme Court

Facts: Issue: Holding:

s son Franklin had a life insurance policy with Empire Mutual Life Ins. Co (AZ company) bought out by Intl Life Ins. Co. (TX company) Intl refused to pay the proceeds of the policy to his designated beneficiary, McGee , claiming Franklin had committed suicide. Payments were made from CA (by mail) and the insured died in CA

Did CA have jurisdiction over Intl based on Internationals contacts with forum?

Yes. The contact was isolated (Franklin was the only person in CA they insured), but it was also continuouslasted for many years Fairness: o CA has an interest in protecting its residents (McGee and son) o Burden on would be much greater in TX than in CA (so much that it would likely discourage from bringing claim) o derives benefit from the contract, voluntarily made, by Intl with CA resident McGee by mail o Intl solicited businessbut this is NOT the issueregardless of who solicited whom, the company decided to enter the state Here, a single contract gave rise to the cause of action jurisdiction Is mail sufficient to establish s presence or contacts? It derives benefit from this activity. Also, if companies were not subject to jurisdiction by mailing contact alone, all foreign corporations would be using mail to avoid litigation. (DP in light of changes in business)

HYPO: (1) Arizona resident is insured by International Life. His company transfers him to California. He notifies
International Life about his change of address, and he sends premiums from California to International Life. Does that change the result? No. International Life still derived benefits. (2) Insured is a resident of Arizona, moves to California, and then dies. Beneficiary sues. Is there jurisdiction? could argue they never agreed to insure you there (no benefit), while could argue he already paid for that time, even though payment came from Arizona.

Hanson v. Denckla (S.Ct. 1958) Focuses on s relationship to forum, requires purposeful availment of benefits/protections of forum state RULE: Unilateral activity with non-resident does not satisfy the requirement of min. contacts with the state, must purposefully avail itself of privilege of conducting activities w/in state

Procedural Background: (multiple lawsuits, S.Ct. combines) Florida Residuary Legatees1 (P) Beneficiaries2 (D) and Trustee Trustee doesnt appear Has to have jurisdiction over trustee b/c its defined as indispensible Issue of jurisdiction is raised by beneficiariesif they dont have the trustee, they cant litigate against Beneficiaries or Trustee RLs want to set aside the trust, so that the $400k will pass to them, claiming that the inter vivos appointment was not valid RLs chose Florida b/c Florida law would say that the trust is invalid (doesnt have requisite formality) FL asserts that the probate of the will gives jurisdiction

Delaware Beneficiaries (P) Residuary Legatees (D) Facts: Mrs. Donner set up a trust in Delaware with bank with instructions: $400,000 goes to beneficiaries and whatever remains goes to residual legatees Upon Mrs. Donners death, the powers of appointment were executed, and the beneficiaries received $400K. The residuary legatees filed suit in Florida hoping to set the trust aside, and they named the beneficiaries, the executrix (executors of will), and the settlors trust company (naming the trustee as a ) as s. Validity of the trust Under the will, the appointment is invalid and thus the $400,000 returns to the estate and passes on to the Residuary Legatees

Issue: Whether FL has jurisdiction over Trustee (Delaware Bank)

Holding: Majority: focuses on validity of trust o o The majority looks at all the McGee like factors, but says that whats missing is the relationship between FL and the Trusteethe Trustee did not reach out to FL Ct. says that even if the forum is interested and convenient, there has to be some act by the whereby the purposefully avails itself. This comports with TNFPSJimposing an obligation on the to litigate in return for benefits that the non-resident purposefully sought.

1 2

Legatees: those who are left property under a will; Residuary legatees receive everything that is left Those who get benefits of the trust

Florida claims it has in rem jurisdiction: Problem: In rem jurisdiction requires tangible properties. The securities were represented by documents, which were located in Delaware. When probating the will, however, the intangible property is then deemed to have a citus at the domicile of the deceased. The Court says this is a fiction that has limited ability and wont give in rem jurisdiction. If Florida can then inquire into validity of the trust (created between Pennsylvania and Delaware) it would essentially give FL nationwide SOP. So the Court says that Florida cant inquire into actions that have nothing to do with it. o In personam? The Dissent (focusing on validity of appointment) argues that Floridas relationship with the settlor and trust is valid basis for jurisdiction. Donner lived in FL, her heirs lived there, she died there. The purposefully chose to carry on business there. FL is interested b/c all the RLs and Beneficiaires are in FL. FL is convenient This case is similar to McGee a contract serves as a sufficient link when it establishes a cause of action that resulted from that contract. Conversely, it can be distinguished from McGee because it involves a unilateral contract with which the trust company did nothing to deliberately connect itself with the state. o Key issue: Making the court see that the issue was the validity of the trust and not the validity of the power of appointment. If the cause of action arose out of validity of power of appointment, FL would have jurisdiction. HYPO: An insurer doesnt know you moved from Arizona to California. They mail the premiums to Arizona, and the mail forwards them to California. Does California have jurisdiction over the insurer? No the contract is unilateral. (Remember to think of activity in terms of unilateral benefits.) o

Gray v. American Radiator & Standard Sanitary Corp. et al. (IL S.Ct. 1961) Effort by Illinois to take advantage of the expansion of in personam jurisdiction made possible by McGee due process can be satisfied by transaction that has substantial connection with the state. One of the first states to use a Long Arm statute to do this. Now, SOP may be made out of state, and the state reaches out to assert jurisdiction on the basis of s relationship to the forum. RULE: A state, under its Long Arm statute, may have jurisdiction over a manufacturer from a foreign state when, though the stream of commerce, his product is used in that state and causes injury

Procedural Posture: Facts: Gray, domiciliary of Illinois American Radiator of Pennsylvania - buys valves for water heaters from Titan Valve Manufacturing Co in Ohio American sells water heater to Gray Valve was defective: it explodes and causes Gray injuries. Gray sues Titan, the manufacturer of the valve that exploded, in Illinois. Titan is located in Ohio. Titan moves to quash, claiming that it didnt commit a tortuous act. However, Illinois has a statute that asserts jurisdiction within its borders if the commits a tortious act within the state. Trial court quashed on jurisdictional grounds

Issue: Holding: Yes, the court has jurisdictiondoesnt violate Due Process Two part statute: 1) jurisdiction over non-resident based on tortious action and 2) Due Process question Court looks to facts to determine whether it fits under statute; reads statute as going the limits of due process It doesnt read Illinois statute literally (as in Smyth) and interprets it to mean that an act committed outside of Illinois that gives rise to a cause of action in tort in Illinois as the same as an injury. Otherwise, the statute as applied would violate Due Process (circular tort problem again). Yet, this reading seems to go too far. Now, IL can assert jurisdiction every time there is a tort. o But the court sticks with this broad reading and then answers the question on constitutional grounds (due process question) Court performs a minimum contact analysis: what did the do in the forum? o Benefit to? Titan sells valves to American who then uses them in water heaters and sells those everywhere does benefit to Titan end at transaction with American (Titans argument) or does it continue through Americans sales (Grays argument)? Must establish a continuous business relationship where Titan continuous, if indirectly, benefits from this stream of commerce; the more valves sold, then, the more benefit down the chain. This argument equates purposeful availment with the SOC benefit o Continuous and systematic activity (business relationship) Does Illinois have jurisdiction over Titan under their statutedoes it violate 14th amendment as applied?

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Purposeful and deliberate action (not enough to simply foresee that a product will enter forum)must purposefully avail oneself of benefits, privileges, and protections of state. Note: this is not the Hanson test in pure form, Gray uses the same idea to establish a new test of transaction connection to the forum

Buckeye Boiler Co. v. The Superior Court of LA County (CA S.Ct. 1969) Like Gray, CA is asserting Personal Jurisdiction over the defendant through Long-Arm statute that goes the limits of Due Process RULE: Court can assert personal jurisdiction over a when the purposefully avails itself of the forum and the cause of action arises out of that contact

Procedural Posture: Facts: Issue: Holding: Yes CA Statute: authorizes SOP on foreign corporations doing business in state (like LAs (B) going the limits of Due Process) Court says that to have personal jurisdiction, must have purposeful availment AND the cause of action has to arise out of THAT contact. Court solves the problem: assumes tank came to CA either from re-sales from customers (sales chain) or it came from cochin and they shift the burden to the to show 1) that its arrival was wholly fortuitous (not purposeful availment) and 2) that the burden of litigating for this boiler was different than for litigating over the others s purposeful availment? o A manufacturer engages in economic activity within a state as a matter of commercial actuality whenever the purchase or use of its product within the state generates gross income for the manufacturer and is not so fortuitous or unforeseeable as to negate the existence of an intent on the manufacturers part to bring about this result o economic activity in forumcommercial actualitypurposeful availment Thus, claim arises from the activity in the forum, product in CA Does CA have jurisdiction over Buckeye? Flynt (GE factory worker in CA) was injured when a pressure tank (Buckeye Boiler Company printed on it) exploded. Sues Buckeye. Buckeye does business with Cochin, a CA corporation Tank in question, however, was not sold to Cochin and there is no evidence as to how the tank came to be in CA Buckeye moves to quash saying it wasnt doing business in the state, so court has no jurisdiction Motion denied Buckeye moves to quash again

HYPO:

Suppose you have a in AZ, filing a suit against Buckeye and Cochin because a tank failed in AZ and crushed . Does AZ have jurisdiction over Cochin in Ohio? Yesbecause they sold the lift to someone in AZ. Buckeye? YesBuckeye gets the benefit. Manufacturer is assumed to follow the product (at this point) because this chain of sales brings benefit back to manufacturer.

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World-Wide Volkswagen Corp. v. Woodson (S.Ct. 1980) Reevaluates minimum contact analysistwo parts (states sovereignty, fairness questions)and now requires that s relationship to forum must be the focus in minimum contacts analysis RULE: It is not enough for one isolated incident to establish s relationship to the forum; must reasonably foresee that his activity may require him to be haled into court in forum

Procedural Posture: Facts: Issue: Holding: No s activity in forum: o Positive: one isolated incident (wreck in OK) o Negative: no services in OK, no business Long Arm statute of OK: A court has jurisdiction over a person who causes tortious injury in the state by an act or omission outside this state if he regularly does or solicits business or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this state Do facts fit the statute? Court says yes, reads the statute disjunctively (two parts)deriving revenue from the goods consumed (sales in NY). Not deriving revenue in OK, but goods are used in OK. o Therefore, Ct. says statute applies Ct. addresses Due Process question: expands notion of minimum contacts from Int. Shoe and breaks minimum contacts into two functions: o Fairness: Burden on (McGee) Burden on Interest of the forum state o Federalism: Check on states power (Pennoyer) States power cannot extend into other states, so must have connection to the forum Whether OK has jurisdiction over WW and Seaway, when s only connection to forum is through customer who brought product to forum s Robinson family, residents of NY moving to AZ (domicile is still NY) World-wide is a wholesale distributor based in NY. Seaway is a car dealership in NY and receives vehicles from World-Wide. s bought an Audi from Seaway and on their move from NY to AZ get into an accident in OK drunk driver hits them, car bursts into flames and seriously injures the family s sue s in OK court District court and Supreme Court of OK rule that OK has jurisdiction over j because the could foresee the use of the car in OK

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Court answer the question in Hanson cannot assert jurisdiction unless there is a relationship b/w the and the forum that justifies the assertion of jurisdiction. Focusing on the s relationship to forum satisfies equitable administration of the law because 1) predictability of litigation, 2) relationship=plan for risk (e.g. costs might be included in product price), and 3) has the choice whether the benefit of connection outweighs the risk Majority concludes that s relationship with the forum was not enough to justify the assertion of jurisdiction one isolated incident o forseeability alone is not enough (must be some benefit) asking whether the could foresee the car ending up in OK is wrong question rather, ask if it is foreseeable that car would end up there and if the relationship of to the forum such that it is foreseeable that would anticipate being haled into court there. Must be seeking a benefit; if the relationship is beneficial and if sought that benefit, its reasonable to anticipate being subject to suit. (Here, benefit ends with sale to ) DISSENT (Brennan): o Brennan argues the question of whether jurisdiction is fair should be based on convenience of forum unless burden on is unfair. The focus should be on the relationship b/w the forum transaction and the plaintiffs, unless its so burdensome for to litigate that it would be unfair. majority says that Due Process as a check on states sovereignty demand the focus on the relationship o The traditional rule is that where the accident happened is the law that will apply o If the relationship b/w OK and cause of action allows OK law to be applied and OK is convenient and interested, why no jurisdiction? Domicile, territory, doing business focus on s relationship to forum Other fairness factors (convenience, burden) not s relationship to forum There are tension in past cases whether to allow jurisdiction to be asserted by convenient of s relationship to forum

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Asahi Metal Industry Co., Ltd. v Superior Court of CA, Solano County (S.Ct. 1987) Addresses question posed in Gray, where does the SOC end? RULE: Split decision (4/4), Burden on to litigate too great (fairness requirement not met)

Procedural Posture: Original Zurcher (victim) files suit against Cheng Shin (tube manufacturer) Cheng Shin files cross-complaint against Asahi (manufacturer of tubes valve) Zurcher v. Cheng Shin settled Cheng Shin v. Asahi o Asahi filed a motion to quashSuperior Court denied, claiming Asahi did international business and should expect to defend their product on international scale o Appellate court reversed Superior Court (no jurisdiction) o Supreme Court of CA reversed Appellate (yes jurisdiction)

Facts: Issue: Holding: State Statute: goes the limits of Due Process What did do in the forum? o Sold valves to Cheng Shin, who used 20% of valves in products sold to forum Split on the question of SOCis it enough? o SOC (Brennan) 4 judges Yes. Putting something into the SOC refers to the regular anticipated flow of products from manufacturer to distributor to sale. As long as the participant is aware that the final product is being marketed in the forum State, the possibility of lawsuit there cannot come as a surprise (requires awareness) o SOC plus (OConner) 4 judges No. Placing a product in the SOC without more is not an act of the purposefully directed toward the forum state. Deriving benefit does not establish enough of a relationship b/w and the forum Plusadditional conduct includes designing product for market (in particular) advertising in the forum marketing through a distributor who agrees to sell as agent in forum All judges (8) agree on fairness: o The forum does not have an interest because isnt a resident o Also, a HUGE burden on to litigate in CA (where evidence is) Whether CA can assert jurisdiction over Asahi Asahi manufactures valves in Japan and sells to Cheng Shin in Taiwain, who puts them into tire tubes Tire tubes are sold by Cheng Shin to CA and original bought a motorcycle with one of these tire tubes Tire explodes and is injured (defect is in valve)

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This is a rare case where the reasonableness (fairness) factors outweigh any argument for assertion of jurisdiction

Burger King v. Rudzewicz (S.Ct. 1985) S.Ct. interprets the Due Process clause again focusing on the check on state sovereignty v. the protection of the s liberty interest describing protection of s liberty interest only requires link to forum (have fair warning) RULE: a single contract isnt enough to establish personal jurisdiction, but a contract plus is (fair warning).

Procedural Posture: Facts: Issue: Holding: No. Emphasis with DP here is whether it protects the s liberty interest (rather than states power) and whether the has fair warning that his activity may subject him to the jurisdiction of the forum (predictability)this is not unilateral or fortuitous (must arise out of activity) Due Process: Court says that if the state has a connection to the cause of action and is convenient, due process will allow the state to assert jurisdiction o The contract gives fair warning because all BK operations are located in FL, all relevant notices and payments were sent there, and the negotiations were made and enforced in FL (training), and signed K that FL substantive law would control disputes Ct. held that FL has jurisdiction over o In this case purposefully availed himself of FL b/c his actions proximately resulted in substantial connection with FLphysical presence isnt necessary as long as the actions were purposefully directed toward residents of the forum state. o The claim arises out of s activitynot paying K Whether FL statute as applied violates due process? Burger King Corp., FL Franchisee (Rudzewicz), Michigan (MI) s entered into contract with BK to become franchisees. went to training in FL, and dealt with the Michigan BK representatives Eventually couldnt make payments and thus allegedly breached franchise agreement with . BK required them to close their stores, but they didnt. So BK files suit in FL (where headquarters are) to get a judgment requiring s to close the store in Michigan Trial court rules against saying had breached their franchise agreement and infringed on BKs trademark rights appeals to 11th Circuit reversed; said the was deprived of reasonable notice and financially unprepared for prospect of franchise litigation in FLoffends TNFPSJ (FL did not have personal jurisdiction over ) appealed to S.Ct., but the Court turned it down b/c jurisdiction by appeal doesnt properly lie S.Ct. then accepted a petition for writ of certiorari

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However, it held that one contract is not enough to sustain jurisdiction: o Besides that one contract, the needed fair warning of being haled into court in FL o Contract is a device; the relationship of to forum is established through the negotiations If there is one contract with sufficient negotiations before contract is formed, would have fair warning (Contract Plus) o Court also requires that the contract relationship be long-term (continuous) Note: this case, like Hanson, its important to convince the court through argument what the issue is (whether the s relationship with BK was in Michigan or Florida) Fairness factors: o has not proved (according to majority) that there are factors that outweigh his litigating in the forum o FL has an interest in protecting its citizens and applying its law (b/c theyre the experts on their own law, as opposed to Michigans interpretation of FL law) Dissent: o Unreasonable to require (franchisee) to litigate in forum of franchisor Predominate contacts were with Michigan office is financially unprepared and bereft of reasonable notice if required to litigate in FL

HYPO: Hypo Consumer wants to sue LL Bean based on a single contract. LL Bean wants to sue consumer based on a single contract. In the first situation, jurisdiction is allowed because if it were not allowed, LL Bean would continue to flood the state with defective merchandise. Also, it encourages interstate commerce. You would think that if the answer to the first questions is yes, then the answer to the second question would be yes as well. However, that is not the case. Why? That will discourage interstate business. LL Bean takes precautions for failure to pay. The price of its products includes insurance policies and takes consumer defaults into account. Hypo (Ohio) sues (Pennsylvania) for breach of contract. Can sue in Ohio because didnt pay (assuming there were no negotiations like in Burger King)? Yes. Where there is a contract, there is fair warning. will charge more in case they have to defend in another forum. But if its a company against an individual, the individual has no way to offset costs. You could only protect yourself by not entering into contracts, which would discourage interstate commerce.

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Kulko v. Superior Ct. of CA (S.Ct. 1978) Demonstrates the role of public policy in minimum contacts analysis & effect in forum RULE: divorced parent agreeably acquiescing to childrens wishes to live with other parent in dif. Forum is not purposeful availment or cause enough effect in the forum no jurisdiction

Procedural Posture: Trial, Appellate, state S.Ct. CA has jurisdiction over CA S.Ct. said the daughters move caused enough effect in the state to warrant jurisdiction (father derived benefit--didnt have to pay for daughter=disposable income increasedand daughter received benefit/protection from CA)

Facts: Kulkos married in CA, but move to and are domiciled in NY o Have two children in NY Kulkos divorce; ex wife moves to CA and remarries o Divorce terms: kids live in NY during school yr., CA for summer/vaca o Daughter decides to move to CA to live with mother, father buys her a plane ticket o Son decides later to move to CA too, but father refuses to buy ticket; mother buys it and he moves to CA Ex-wife sues ex-husband for more child support in CA. Father contests jurisdiction

Issue: Holding:

Can CA assert jurisdiction over father in NY?

No. The effects test as applied to the father would violate DP Fathers acquiescence to kids wishes doesnt establish enough of a connection between and forum (not purposeful availment)the benefits were received by the children in CA; any benefit he received was not from his act or being in CA but from his children not being NY Court rules against jurisdiction here b/c of public policy divorced parents will be reluctant to let kids live with the other parent if in doing so they submit to other courts jurisdiction

HYPO: Hypo Kulko is married, lives in New York, and has kids in New York. His wife decides to go to California, and she leaves Dad with the kids. Once there, she really enjoys it and decides to stay. Dad suggests that she should contribute to the kids. She laughs, and he files suit. If you represented Dad, what would your argument be to the New York court that it could assert in personam jurisdiction? Like in McGee, the mother had an obligation, and this obligation gave rise to the necessity for her to make payments. This obligation comes from the fact that she is a parent, not that the parents entered into a formal agreement.

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Hypo If the facts were the same as above, but the husband left rather than the wife, what argument can be made to assert jurisdiction? He breached his duty to pay child support, and therefore quasi-in rem jurisdiction can be asserted. Hypo The couple is married in California, lives in New York, and the wife then moves to California. o Which state could grant divorce? Under TNFPSJ, California could render divorce because the wife is domiciled there. The judgment declares the status of , and California can assert jurisdiction for that because is domiciled there. o If kids go to California on free will, could California declare that Mom has custody? Courts used to operate depending on if the kids were present before the court. This led to federal statutes against child kidnapping and doing away with where the child is present. The home state has jurisdiction (the child must be there for six months). o Could California render a judgment obligating the husband to pay child support? If the wife files in California, and the husband answers in New York, the courts cooperate to render a judgment.

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Calder v. Jones (S.Ct. 1984) effects test, where it does give the court jurisdiction over (NOT products liability) RULE: where s (individuals) purposefully direct their actions toward a resident of forum, effecting the forum, and cause harm to that , jurisdiction is valid.

Procedural Posture: Facts: , an actress, resident of CA Calder (Editor of National Enquirer-FL), South (Reporter for National Enquirer) National Enquirer published a libelous article about , written by South. South had contacted sources in CA to gather information about to write the article (and had spoken to about the article) and had visited CA 20x over 4 yrs for business. Calder had only been to CA twice on nonbusiness related trips. Trial court=no jurisdiction; Appellate court reversed=jurisdiction

Issue: Can CA court assert jurisdiction over Calder/South?

Holding: Yes. If you can assert jurisdiction over the National Enquirer, it does not follow that you can assert jurisdiction over the employees simply because they are employees. s arguments: o They didnt purposely connect themselves with California. o They arent responsible for the magazines distribution there because they dont direct the activity of the magazine. o They dont have any contacts with California. o They dont derive benefit. o They make the analogy that they were like the welders for Buckeye, and the welders would not be taken to court in a forum that one of the tanks they worked on happened to explode. The court distinguishes the two situations: The s actions here are intentional, whereas in Buckeye they were negligent. If it was negligence that libeled Jones, then they could have not been taken into court in California. California is where the harm occurred because the lived and worked there. The court finds that jurisdiction can be granted because the actions of the were intentionally damaging and directed into California even though it went elsewhere as well. The court would have jurisdiction even if the s had not traveled to or telephoned California. Could we get jurisdiction over in other states, then since Jones reputation was damages in all states that the magazine entered? o No. Question ultimately becomes, Are we suing based on damage to Shirley Jones or are we suing based on damage intentionally directed at California?

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The answer is that the suit is based on intentionally acts directed at California. Targeting means taking aim at the person specifically where the person lives. What about TNFPSJ? o caused the harm. o should not be surprised about litigation arising in California. o It doesnt matter that cant control where magazines go; the contact through the magazines is not important. Note: Court distinguishes actions of Calder and South from other products liability actions (making employees follow products), but the court says were dealing with an article and writersNOT products liability. These are taking aim at CA and . Two important criteria: is a public person and the harm done to her as public figure (doesnt matter if the article were true or false, doesnt change the results of the harm) HYPO: Hypo If you mail a bomb to in California, can California assert jurisdiction over you? Yes you intended the harm in California. Hypo- Jones reads an ad for a beauty produce manufactured in FL. The products are all specifically tailored to the customer. Gathers info from P to make product. Chemists (Calder and South) work on it. Arrives. She applies it correctly, but melts her face off. She is unhappy and sues company but also Calder and South. Would CA be able to assert jurisdiction? Yes. WHY???????

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Keeton v. Hustler Magazine, Inc., et al (S.Ct. 1984) Specific jurisdiction over when cause of action arises in multiple states (magazine article) RULE: Since derives benefit from sales everywhere and the article becomes defamatory wherever its published and sold, jurisdiction may be asserted in a state where s only connection is through publication

Procedural Posture: Facts: Issue: Holding: Yes. Though s COA was more grave in NY (her domicile), NH still wants to protect its citizens from false material (discourage deception) this question only bears on jurisdiction in terms of the focus of the The Court says that s residence in the forum state is not a separate requirement, and lack of a residence will not defeat jurisdiction established on the basis of s contacts. single publication rule: defamation occurs when published, so whenever and wherever its distributed the tort of defamation occurs. Only one action for damages may be maintained; all damages suffered in all jurisdictions may be recovered in the one action; and a judgment for or against upon the merits of any action bars any other action for damages b/w the same parties in all jurisdictions derives a benefit from sales of the magazine Does NH court have jurisdiction over non-resident (and ) when s only connection to the forum state is through the sale of article published and sells in all states? , NY resident Hustler (domiciled in OH, principal place of business CA) printed a libelous article about , and sues for damages; brought suit in NH because it was the only state in which the statute of limitations had not run out sued for libel, but trial court dismissed because is a non-resident Appellate court affirmed

HYPO:

Could Jones sue Calder and South in NH? No. It harmed her reputation in NH, caused harm to citizens of NH, BUT they did not target her in NH. Note difference b/w Calder and Keeton: where may s be sued/where may s sue o Calder

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Keeton

= resident of forum = editor/reporter = non-resident of forum = magazine

Revell v. Lidov (5th Cir. 2002) Minimum Contacts analysisonline RULE: Posting a defamatory article on a website not specifically directed at the forum does not satisfy the effects test (minimum contacts) of Calder does not give personal jurisdiction

Procedural Posture: Facts: Issue: Holding: No. The Appellate Court suggested using the Zippo sliding scale to assess minimum contacts necessary with an operation of a website o A passive website: merely allows the owner to post information= no PJ; does not confer the kind of benefit that makes the assertion of PJ fair o An active website: owners engage in repeated online contacts with forum residents over the internet. PJ may be proper. (e.g. Amazon- place orders) o In between are sites with some interactive elements. These require examination of the extent of interactivity and nature of forum contacts. Ct. found that using the Zippo standard, there still was not enough to establish specific PJ Revell argued that Calder effects test applies: o However, the article contains no reference to TX, did not discuss Revells activities in TX, nor is in any way directed at TX readers o s residence in a forum state and suffering harm there will not alone support PJ under Calder o Additionally, Revell claims he had no knowledge of the particular state lived If Calder and South had posted the article on National Enquirer onlinePJ in CA Whether TX could assert jurisdiction over , with s only connection to forum being a libelous posting on a website Lidov (Mass.) Revell (Texas) Lidov wrote a defamatory article about Revell (worked for FBIconspiracy theory, involvement in Pan Am 103 crash) and posted it on an message board on a website hosted by Columbia University. Revell sued for defamation in Texas Trial court dismissed; Revell appealed

HYPO:

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Perkins v. Benguet Consolidated Mining Co., et al. (S.Ct. 1952) General Jurisdiction casefirst time S.Ct. has held that PJ may be asserted when cause of action did not arise out of s contact with forum RULE: Jurisdiction is proper when s connection with the forum is continuous and systematic even though the cause of action did not arise out of such connection

Procedural Posture: Facts: Issue: Holding: No. Due Process would allow jurisdiction, Ohio may decide whether they want to assert it. Even though the cause of action has nothing to do with the forum, Ohio may assert PJthere is a link with the forum general jurisdiction (NOTE: State is not required to take PJ here!) Court draws analogyrelated to the idea (Pennoyer) that jurisdiction is asserted within the boundaries of the state territory o The corporation is there when they have enough continuous and systematic activity o The language used for general jurisdiction differs from specific (minimum contacts) Here, any activity the corporation could perform, it performed in Ohio o President and staff there o Director meetings, policy dealings from Ohio o 2 active bank accounts o Had an office in the forum (this case has been interpreted to meanif there is an office in the forum, that is enough to assert general personal jurisdiction) When can the court assert jurisdiction over when cause of action didnt arise in the forum? o When is domiciled there o If is present but not domiciled (SOP in state while present) o Corporations Where incorporated Principal place of business Where products are manufactured? Would OH assertion of jurisdiction over violate the 14 th amendment (DP)? is suing for not paying dividends from profits in mines operated in the Phillipines and for not issuing her certificates of stock Trial court, Appellate court, Ohio Supreme Ct. sustained motions to quash service of summons on mining corp.

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HYPO: Could you argue for a specific jurisdiction case here? Is it easier to do so?

Helicopteros Nationales de Colombia v. Hall (S.Ct. 1984) General Jurisdiction case where contact was not sufficient RULE: Mere purchases are not enough to establish continuous and systematic activity in the forum to warrant general personal jurisdiction

Procedural Posture: Facts: Issue: Holding: No. One trip to Houston to negotiate, training of pilots, and mere purchases are not enough to warrant general personal jurisdiction (not continuous and systematic activity) o NOTE: though purchases were beneficial to , they didnt warrant PJ Why did the not argue for specific jurisdiction? o They had agreed in advance that claims arising out of the sale would be tried in Peru How could they have argued specific jurisdiction (Brennan in Dissent argues that they shouldve) o Show that the cause of action arises out of the forum connection o The negligent act that caused the crash occurred in Peru, but argue that The crash occurred because of pilot error or negligent servicing of aircraft establishes connection between the crash and TX came to TX for training and servicing of aircraft TX now has an interest (warranty for products) and protection of citizens NOTE: if s wanted to sue for breach of contract this would be no problem in asserting specific jurisdiction, but here they seek damages for wrongful death and negligence Is s activity in forum enough to grant general personal jurisdiction? Helicopteros (Columbia) Hall (US citizens) provides helicopter transport for oil and construction companies in Peru. It purchased most of its helicopter fleet from Texas, trained pilots in Texas, and negotiated contracts in Texas. Four pilots crash in helicopter in Peru. sues Trial court found for and awarded $1.14 million to o Hall () brought suit on behalf of decedents against Helicopteros () Appellate court reversed no jurisdiction TX S.Ct. originally affirmed Appellate decision, but on a rehearing reversed and affirmed trial ct.

HYPO:

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1) Assume a company is engaged in oil exploration in a foreign country. It comes to TX to interview and hire oil field workers and hires them. It purchases drilling equipment, and the equipment and workers go to the foreign country. An accident happens with a worker. Worker files suit in TX for negligent injury during drilling operations in foreign country. General or Specific Jurisdiction case? General wont workthey only made purchases/hired people. Specificminimum contacts: TX has an interest (using it as a forum, TX wants to make sure you treat the hirees carefully) 2) Could you sue American Radiator in Illinois where it sells lots of goods, but isnt incorporated? What about where it buys valves? Do you derive benefit when you sell but not when you buy? The court suggests that selling definitely gives a benefit, but buying doesnt seem to have a benefit. You could argue those purchases allow you to sell your water heaters because you need valves. Grimandi v. Beech Aircraft Corp. (Dist. Ct. D.Kansas 1981) Specific Jurisdiction case under long arm statute where cause of action arose in another forum compare to Helicopteros RULE: s business transactions in the forum state established a causal connection linking the cause of action to the forum state, thus allowing the court to assert personal jurisdiction (specific).

Procedural Posture: Facts: Issue: Holding: Yes. Kansass statute says that a person submits himself to jurisdiction of the courts of the State of Kansas for any causes of action arising from the transaction of any business within the state. (specific jurisdiction-transacting business, like LA 3201 (A)) The Ct. interprets the statute to say that Kansas only requires that the action arise from the doing of an enumerated act which took place in Kansas and that there be a causal connection between that act and s cause of action (broad construction) The Court held that the cause of action did arise out of the forum using the but for test: o but for s transaction of business in Kansas a defective line of engines would not have been incorporated in and certified for use in Beech aircrafts a PT6 wouldnt have been installed as a replacement engine the crash in France probably wouldnt have occurred. o Thus, cause of action flows from and is connected to s transaction of business in Kansas (causal connection) Under Kansas long arm statute (specific), can a Kansas court assert jurisdiction over ? Grimandi? Pratt & Whitney, United Tech Pratt and Whitney () send agents to Kansas to solicit sales of the PT6 airplane engine. Beech purchases them. The engines were sold FOB in Quebec, but were shipped to Kansas. In Kansas, Beech incorporated the engines into their aircrafts. There was alleged defect in PT6 engines that is common to all PT6 engines. The aircraft was made only to fly with a PT6 engine purchases Beech aircraft and it crashes in France, but this airplanes engine had been replaced. The replacement engine was not sold to Beech in Kansas nor had the engine ever been in Kansas. Matter came before court on motions to dismiss by Pratt & Whitneymore than one issue raised (only concerned with personal jurisdiction here)

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If the court used this analysis in Helicopteros, they could assert specific personal jurisdiction because but for the training and maintenance in TX the accident would not have occurred. (Similar argument in dissent of Helicopteros)

Bearry v. Beech Aircraft Corp. (5th Cir. 1987) Court finds that SOC does not support general jurisdiction (wrong) RULE: look to LEnfants interpretation not the courts ruling here.

Procedural Posture: District court found that TX had general jurisdiction based on the SOC theory; since they injected so much into TX, the volume of SOC was continuous and systematic and created a general presence within the state

Facts: Issue: Holding: No. The district court erred in application of SOC theory: it does not apply in a general jurisdiction case because its based on the concept of exchange and that invokes the idea that consented to be haled into court where it exchanges things. o Beech had a right, court says, to shield itself from general jurisdiction by carefully arranging their negotiations outside of TX o There was no real presence w/in the state. If there were employees, there would be presence and therefore jurisdiction. But Beech escapes suit by not having employees there. Interest of TX and the s trying this suit in TX are slightmaintenance of suit would be unfair (this plays a big role in courts decision) Whether the 14th amendment prohibits exercising jurisdiction by a TX court over non-resident defendant for claims having no relation to TX? Bearry (Louisiana) Beech Aircraft (Delaware corp.; Kansas principal place of business) La residents buy a Beech aircraft in La, and the plane crashes in Mississippi. s tried to sue in La, but La long arm statute didnt apply s now attempt to sue in TX because of s large volume of sales to TX

Why Court is wrong according to Lenfant: The focus, set forth in Int. Shoe, should be on the benefit derivedare they deriving continuous and systematic benefit from TX such that it is predictable that might have to litigate there? o The is interested, not inconvenient

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SOC reflects how chooses to do business: the connection is intentional and beneficialmakes the resulting litigation predictable. (SOC works for both specific and general jurisdiction)--? Beech set up business (like Int. Shoe) to receive benefit but avoid suit in forum

Under La. Statutecase outcome? Using the Louisiana long-arm statute o Rely on Grimandi and Helicol dissent to say the cause of action arose out of Louisiana o Aircraft sold by Beech (business in Kansas planes bought there by dealers) o Cause of action out of Beechs business in Louisiana? Beech would argue all business is transacted in Kansas, and all contracts are in Kansas, not Louisiana. Argue International Shoe It doesnt matter how you set up your business. There are still benefits. o The statute says by an agent arent dealers indirectly their agents? Yes. o The problem with this hypo is the plane wasnt purchased from a dealer; it was bought from an individual. o What about (A)(2)? Pay attention to cause of action arising from How can you argue (2) relates to cause of action? Use but-for test of Grimandi. Louisianas interest to protect its citizens from faulty planes Foreseeability could be sued in Louisiana because of the sale of the plane Using (3), injury doesnt have to be in state. You base jurisdiction on the act being in Louisiana. Would this be easier or harder than Buckeye Boiler? Harder California had more interests in Buckeye because the injury occurred there. HYPO: La residents buy beech craft in La, because they wanted to travel west. Biggest obstacle is Texas. These La residents wondered if they could make it, so they decided to fly. Plane crashed in TX. Filed suit against beech in TX. All facts same as in Bearry. Specific or General? What activity of connects it to cause of action? o Responsible for production of product product connects it to forum b/c product caused harm in the forum ( did not cause the product to be brought to forum) o Minimum contacts? Plane arrived fortuitously, so you must establish, as in Buckeye, that Beechs business connections to TX generated benefit and exposed it to risk that Beech would be sued in TX. The only difference is that it was sold in Ladoesnt matter. There is a predictable risk that the kind of business they do would subject them to suit in TX. o Hypo is also like WWV in that Beech would be like Audiif Audi had structured business like Beech, and this is a specific jurisdiction case, the benefit derived through SOC in OK makes the assertion of jurisdiction over Audi fair. o Thus, SOC supports general jurisdiction

NOTE: What about causes of action arising in the forum but completely unrelated to the activity in the forum? This type of case is neither specific nor general jurisdiction. However, it is like specific jurisdiction in the sense that we would get to do a fairness analysis. The burden on the is insignificant since it already has activity within the forum. We are allowed to use the fairness factors.

Specific Cause of action arises from s contact with the forum Look to fairness factors (, forum, burden on ,

General Cause of action does not arise out of the s activity with the forum. Jurisdiction is based on the s relationship with the

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etc.) Then, are s actions deliberate or purposeful (SOC, SOC+)? Minimum contacts

forum. Relationship must be analogous with residence. Only looking at , forum, and amount of activity Continuous and systematic

Shaffer v. Heitner (S.Ct. 1977) The S.Ct. looks at whether quasi-in-rem (traditional basis of jurisdiction, Pennoyer) is valid today and would satisfy International Shoe standard of minimum contacts RULE: quasi in rem requires minimum contacts analysis, but still valid (arrives at in personam)

Procedural Posture: Facts: Heitner, nonresident of DE, has one share in Greyhound, a DE (Delaware) corporation with its principal place of business in Phoenix, AZ. Greyhound didnt perform the way plaintiff wanted to, and the company was found liable criminally and civilly in anti-trust actions. brought a shareholder derivative action in DE (where it was incorporated) against officers/management and Greyhound because officers of company have affected value of shareholders stock. Heitner has an interest in the proper management of corporations, and a shareholders suit is brought by shareholder on behalf of the corporation against the management of the corporation who damages corp. by decisions it made. Hes suing management and corporation itself, but the immediate beneficiary is the corporation and ultimately the shareholder (because of his stock). At the same time, Heitner filed a motion for an order of sequestration of DE property of the individual s pursuant to DE long arm statute. Writ of sequestration: Property (stocks) is seized within the state, as well as warrants/options that give rights to buy additional shares of stock. Stock is represented by a certificate. We would assume those are in possession of s. They can seize this b/c of DEs statute, which says all stock issued in DE corporation is presumed to be in DE. Though its physically present, you would enter a stock transfer order entered in the books of the corporationyou dont take physical possession but prevent anyone from dealing with it by placing in books a stock order to prevent exchange. Sequestration here functions in the same way as attachment; because DE didnt have a long-arm, they have statute allowing sequestration (quasi in rem jurisdiction). Because has property w/in the state, court attaches property, even though the property has nothing to do with the cause of action. But seizure notifies and tries to get him into court (thus, jurisdiction becomes in personam). must either 1) appear or 2) not appear and court will render default judgment and sell stock. DE has this statute to allow s to bring actions against a corporation, protecting the s interest. The only defense a has when his property has been seized is that it isnt his property, or the property wasnt validly attached within the forum. Issue: filed motion to quash saying that the sequestration procedure did not accord them due process under the 14th amendment, and they didnt have sufficient contacts with Delaware

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Is it a violation of DP to assert jurisdiction over through property within its borders?

Holding: The argues that Delaware doesnt have jurisdiction based on International Shoe. The attachment isnt valid because in order to do that, the must have minimum contacts with the forum. The Supreme Court looks at the question of whether International Shoe should be applied to quasi in rem jurisdiction. They use minimum contacts because Since the ultimate goal here of quasi in rem is to obtain in personam by getting into court (presence=consent to in personam) albeit through multi-step approach, the standard should be MC In rem is against the property, not person. Jurisdiction over the property isnt any different; when youre asserting jurisdiction over property youre really indirectly asserting jurisdiction over persons authority over that property or their interest in it. Forums Interest: Placing emphasis on DEs lack of interest (by contrast with McGee), the court showed that DE did not have a statute that said that if you become officer or director of DE corporation, you are subject to in personam jurisdiction in DE. Response? Has Delaware done anything to exhibit a special interest? Passed the quasi in rem statute mechanism And said that stock in corporation is deemed to be in DE o should be able to be called into DE b/c of stock there But, there was no need for a statute before because they thought quasi-in rem would work. Heitners actions against the officers is quasi-in rem because his suit has nothing to do with the shares of stock. The cause of action has to do with the mismanagement of the corporation. Effect: Start with quasi in rem (if D doesnt appear, court is limited to selling property) (if appears, converts it to in personam) (can challenge quasi attachment using MC, if he loses, then its no diff than if P had asserted in personam originally) Then if you show MC in personam jurisdiction Answer challenges in personam Plaintiff appeals in personam Now, whether jurisdiction is in rem or in personam is a matter of minimum contacts. So, presence of a person in state = in personam Presence of property in state = not always quasi in rem Quasi in rem is primarily used now to serve as sufficient legal notice if we dont know where is. Within 13 days after this decision, the Delaware legislature amended its laws to provide that every nonresident who is elected or appointed a director of a Delaware corporation after 9/1/77 shall be deemed to have consented to the appointment of the corporations registered agent. HYPOS Hypo If you buy stock, does that equal minimum contacts? This is not the argument in Shaffer. Here, should Delaware be able to assert jurisdiction over directors of a company incorporated in Delaware? Isnt it reasonably foreseeable? Court says no. Hypo (La.) sues (Ms.) in La. The land is attachedin rem. argues no minimum contacts. now argues derives benefits, and should not be surprised to have to defend itself in the forum Hypo (La.) sues (Ms.) in La. The cause of action is a contract. The land has no connection to the cause of action. Shaffer attacks this type the most. Hypo (La.) sues (Ms.) in La. Funds are in La. Who do funds belong to? The property is movable. Use presence of property as one of the minimum contacts. You dont necessarily have to use more than this. E.g. McGee the cause of action can be the contact needed sometimes. What if you have property in La. that is in transit? Judgment for action in rem is finalFFC. In rem jurisdiction is really over a persons interest in the things, so use minimum contacts. When the underlying dispute is unresolved because the court doesnt have jurisdiction over the , try to force a voluntary appearance.

o o

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Burnham v. Superior Court of CA, County of Marin (S.Ct., 1990) Decides whether SOP on while present in state is still allowed (Pennoyer) RULE: Yes. Presence (even though transient) is still enough to assert PJ over while in forum

Procedural Posture: Facts: Issue: Holding: Yes. Majority view is that tradition holds that presence gives you jurisdiction. You dont need to look at minimum contacts because the is present. Scalia says: would SOP on while in state satisfy TNFPSJ? Yes, because its our tradition. It necessarily satisfies traditional notions. Brennan says: No, have to apply Int. Shoe. We look at what we did with long traditions of Int. shoe. You have to apply Int ShoeBrennan says it satisfies minimum contacts because its fair, while youre there voluntarily you enjoy benefits AND you have fair warning when youre in the state of being SOP. Why do you have fair warning? Because thats the way its always been o Scalia to Brennan: if youre going to base this on Minimum Contacts, what if he leaves without being SOP? Would his contact while he was in the state justify the assertion of jurisdiction after hes returned home? Does a 3 day business/family trip count as contact? Scalia says its not fair. The only thing that allows CA to have jurisdiction is that you served while he was present in state. o This means you have to watch where you areyou may get to a place you dont want to be. (e.g. a flight layover) Is SOP on person while in forum state (presence) enough for in personam jurisdiction? and wife marry in West Virginia Move to NJ He files for divorce in NJ but never serves her She files for divorce in CA, and serves him while hes in CA visiting kids moved to quash on jurisdictional grounds; trial court denied Appellate court and Supreme Court affirmed

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Shaffner and Burnam: two aspects of Pennoyer o SOP in state is still good; presence Brennans analysis allows you to argue in a certain case that a certain visit may not be fair; but ordinarily it exposes you to power of state and gives you benefits. But it would not be reasonable when youre not there.

Mullane v. Central Hanover Bank & Trust Co. (S.Ct. 1950) Due Process: requires reasonable Notice and Opportunity to be Heard RULE: notice by publication is not valid where plaintiffs addresses are known; notice must be reasonably calculated under the circumstances to reach the

Procedural Posture: Mullane objected to the statutory provision for notice by publication, arguing that it was unconstitutional for lack of due process under the Fourteenth Amendment. The Surrogates Court overruled Mullanes objection and the ruling was affirmed on appeal to the New York Supreme Court Appellate Division and the New York Court of Appeals. The United States Supreme Court granted cert.

Facts: Mullane, attorney for beneficiaries Central Hanover Bank Central Hanover Bank was the trustee of a common trust fund formed by pooling the assets of a number of smaller trusts. Central Hanover Bank petitioned to the New York Surrogates Court for a judicial settlement of the trust. The only notice provided to beneficiaries was via publication in a newspaper. Mullane was the court appointed attorney and special guardian for a number of beneficiaries who either were unknown or did not appear. If the beneficiaries dont effectively receive notice, they are not able to later sue the trust company for mismanagement. NY statute allows for pooling of small trusts; also allows for notification by publication?? Trust Pools: under NY law, you may pool assets if individual trusts dont have sufficient assets to be administered separately. You may combine and share expenses/benefits based on their proportion of contribution. Bank has to file accounting (for investments, returns, fees charged, and expenses incurred) before a judge every so often; after, the judgment sent down binds the beneficiaries (income and principal) such that they cant sue the bank for mismanagement. Advantage of pools: allows small trusts to be pooled so that the total assets are sufficient to bear the expense of having those assets invested and administered by a fiduciary

Issue: Is notice by publication where the parties addresses were known constitutionally valid (satisfying Due Process)?

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Holding: No. Notice given to out of state parties by publication in a newspaper, when the parties addresses were known, is unconstitutional in light of the Due Process Clause of the Fourteenth Amendment. Notice must be reasonably calculated to inform known parties affected by the proceedings. However, constructive notice by publication was acceptable with regard to missing or unknown parties or for those whose whereabouts could not be ascertained by due diligence or for whom future interests were too conjectural to be known with certainty. (and state) argued that they have a right to discharge trustees; the court accepts this right, but the question is by what means must the give beneficiaries notice to contest the discharging of a trust The fundamental requisites of due process are o 1. The opportunity to be heard this must be balanced with the States interest in bringing a settlement of fiduciary claims for people who are outside of the forum States interest in adjudicating this transaction is so strong (b/c interested in trusts), that it serves as a proper basis for adjudication for the trust under NY law o 2. Notice: to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. The notice must be of such nature as reasonably to convey the required information, and it must afford a reasonable time for those interested to make their appearance Thus, notice must be reasonably calculated to reach the The only time publication alone would be acceptable is when there is no better method but only for parties whose interests or addresses are unknown Here, the beneficiaries addresses were known, and they had previously sent them mail The court is satisfied with using mail for notice (not even certified, but regular) the statutory notice to known beneficiaries is inadequate, not because in fact it fails to reach everyone, but beach under the circumstances it is not reasonably calculated to reach those who could easily be informed by other means at hand Additional argument: how can NY assert jurisdiction over beneficiaries who do not live in NY

Hypo: Court doesnt analyze purposeful relationship w/forum (Minimum Contacts). Would Court have decided Mullane the same way if Mullane had followed Hanson (Purposeful availment)? Could you assert jurisdiction in case like Mullane over non-res beneficiaries who only interest or connection w/ NY is that they receive income from NY trust? Where is their purposeful availment as opposed to having contact with NY that is a unilateral act of a 3rd party You want to assert jurisdiction over beneficiaries in NY, because if you cant you have to go where the beneficiaries are. In actions dealing with administration of trusts set up under NY lawuse presence of assets to say that these assets create a benefit for principal and income beneficiaries; even though they may not have set up themselves, they are the recipients. The deliberate benefit is directly connected to NY. Combine NYs interest and their benefitthat is the important components for argument in jurisdiction Have to make it differently after Hanson. Cited Mullane that FL had jurisdiction. How does D object to inadequate notice? In Mullane, atty files an objection, motion to dismiss b/c method for notifying absent beneficiaries is inadequate under 14th amendment. But this presumes that D has notice. File a motion to dismiss (under rule 12b).

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Mas v. Perry (5th Cir. 1974) Diversity Jurisdiction RULE: taking up residence somewhere without an intent to remain does not change ones domicile

Procedural Posture: Facts: Issue: Holding: Yes Court concludes that Mrs. Mas is a citizen of Mississippi and that district court had diversity jurisdiction For diversity, original jurisdiction in federal district courts of all civil actions that are between, inter alia, citizens of different States or citizens of a State and citizens of foreign states and in which the amount in controversy is more than $10,000. (now, $75,000) o Burden to prove diversity falls to Mrs. Mas is determined to be a citizen of Mississippi because she did nothing to effect her domicile in Mississippibeing a grad assistant and even stating that she did not intend to return to MS did not effectively change her domicile. She was residing in La. o She does not automatically give up her domicile (and citizenship) by marrying a foreigner o She had no plans to remain in La., and until she established a new domicile, she maintains her old one (Mississippi, domicile from birth) Did the district court have requisite jurisdiction over Mrs. Mas? s, Mr. Mas- France; Mrs. Mas-Mississippi Perry- Louisiana s were married in Mississippi. rented an apartment from while teaching as graduate assistants at LSU. s discovered that there were two-way mirrors in apartment and found that they had been watched by for 3 of the first 4 months of their marriage. Federal District court found for ($5,000 to Mr. Mas, $15,000 to Mrs. Mas) and jurisdiction was not found to be lacking

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Mr. Mas becomes a citizen by marriage to Mrs. Mas Citizenship: o Citizenship = domicile o To be a citizen of a state, you must first be a US citizen and a domiciliary of the State o Domicile = place of true, fixed, and permanent home and principal establishment, and to which the person has the intention of returning whenever absent therefrom (same as in state personal jurisdiction) o Domicile can be changed by a combination of two elements: 1) taking up residence in a new domicile, and 2) intending to remain in the new domicile When does diversity jurisdiction have to occur? When the suit is filed. It doesnt matter if they are diverse when the suit actually goes to trial.

Strawbridge Facts: -Massachusetts - some from MA, one from VT Establishes complete diversity, but only governs cases brought under 1332(a) (1) RULE: all s must be from another state

Procedural Posture: Issue: Holding: Affirmed (no jurisdiction) Congress has said for diversity of citizenship that the suit is between a citizen of a State where the suit is brought, and a citizen of another State This means that all s must be able to be sued in federal court (i.e., that they all must be citizens of another state) This establishes the complete diversity rule district court dismissed b/c of lack of jurisdiction

Randazzo v. Eagle Picher Ps complaint dismissed for failure to plead grounds for SMJgiving P opportunity to amend it [must allege subject matter jurisdiction over corporation (where its incorporated)]. P sent back the same one. Bad idea. Judge dismissed it with prejudicecant bring suit again. Federal Judges: lifetime tenure, salary not reduced, beholden to no-one, overworked, cranky; they dont care about votes! Heitz

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