Mon., Sep. 18

what does it mean for a cause of action to arise out of or be related to contact with the forum state?

NY Co. distributes its widgets in every state in the country it sends a defective product into Pennsylvania where Consumer, a citizen of Ohio, purchases it Consumer takes the product to his home in Ohio where he suffers serious injuries caused by the defect PJ over NY Co. in Ohio?

Bristol-Myers Squibb Company v. Superior Court (US, June 19, 2017)

NY Co. distributes its widgets in every state in the country it sends a defective product into Pennsylvania where Consumer, a citizen of Ohio, purchases it Consumer takes the product to his home in Ohio where he suffers serious injuries caused by the defect Consumer sues as co-plaintiff with P, an Ohioan who bought his widget in Ohio PJ over NY Co. in Ohio for both actions?

general in personam personal jurisdiction over corporations

Int’l Shoe While it has been held in cases on which appellant relies that continuous activity of some sorts within a state is not enough to support the demand that the corporation be amenable to suits unrelated to that activity, there have been instances in which the continuous corporate operations within a state were thought so substantial and of such a nature as to justify suit against it on causes of action arising from dealings entirely distinct from those activities.

GOODYEAR DUNLOP TIRES OPERATIONS, S. A., v. EDGAR D. BROWN U.S. S.Ct. - June 27, 2011

“For an individual, the paradigm forum for the exercise of general jurisdiction is the individual’s domicile; for a corporation, it is an equivalent place, one in which the corporation is fairly regarded as at home.”

Daimler AG v. Bauman (US 2014)

side issues…

do the plaintiffs state a claim under federal law?

when can a subsidiary’s contacts be imputed to the parent to create general in personam jurisdiction?

can a case with sufficient contacts for general in personam jurisdiction still be knocked out by the McGee factors?

upshot – only in “exceptional” cases will there be general in personam jurisdiction over a corporation beyond a corporation’s state (or nation) of incorporation and the state (or nation) of its principal place of business

is Hertz relevant here? should we conclude, citing Hertz, that there is general in personam jurisdiction over a corporation only in its state (or nation) of incorporation and the state (or nation) where its nerve center is located…?

- the D Corp (incorporated in France with its PPB in France) owns hotels - it puts a new flooring in all of its hotels - P (NY), goes to bought a D Corp hotel in in France, where he slips on the floor and is injured - P sues the D Corp. in federal court in NY - the D Corp. has 10 hotels in NY - there is already litigation in NY concerning accidents on the floors of the NY hotels

quasi in rem

Glannon says distinguish… “attachment” necessary for quasi-in-rem and in rem under Pennoyer (involves only a filing at registry of deeds that gives notice to potential buyers) and post judgment attachment and attachment for security

what did Pennoyer really say was necessary for quasi in rem?

“In the case against the plaintiff, the property here in controversy sold under the judgment rendered was not attached, nor in any way brought under the jurisdiction of the court. Its first connection with the case was caused by a levy of the execution. It was not, therefore, disposed of pursuant to any adjudication, but only in enforcement of a personal judgment, having no relation to the property, rendered against a nonresident without service of process upon him in the action or his appearance therein.”

Closson v. Chase, 158 Wis. 346 (1914) (quasi in rem judgment is valid in absence of any attachment, provided that the property that is the source of jurisdiction is identified at the initiation of the suit)

are quasi in rem actions still constitutional?

P (NY) and D (NY) get into a brawl in New York D’s only connection with California is owning a small piece of property in the state P sues D in state court in California using the property as the source of jurisdiction

Harris v. Balk (US 1905)

P (NY) and D (NY) get into a brawl in New York D’s only connection with California is that X, someone who owes D money, is in California P sues D in state court in California using the debt X owes D as the source of jurisdiction

Shaffer v. Heitner (US 1977)

shareholder’s derivative action

Appellants contend that the sequestration statute as applied in this case violates the Due Process Clause of the Fourteenth Amendment both because it permits the state courts to exercise jurisdiction despite the absence of sufficient contacts among the defendants, the litigation, and the State of Delaware and because it authorizes the deprivation of defendants' property without providing adequate procedural safeguards. 

was a limited appearance allowed?

footnote 12 Under Delaware law, defendants whose property has been sequestered must enter a general appearance, thus subjecting themselves to in personam liability, before they can defend on the merits.

“For in cases such as Harris and this one, the only role played by the property is to provide the basis for bringing the defendant into court. Indeed, the express purpose of the Delaware sequestration procedure is to compel the defendant to enter a personal appearance. In such cases, if a direct assertion of personal jurisdiction over the defendant would violate the Constitution, it would seem that an indirect assertion of that jurisdiction should be equally impermissible.”

“We therefore conclude that all assertions of state-court jurisdiction must be evaluated according to the standards set forth in International Shoe and its progeny.”

I would explicitly reserve judgment I would explicitly reserve judgment . . . on whether the ownership of some forms of property whose situs is indisputably and permanently located within a State may, without more, provide the contacts necessary to subject a defendant to jurisdiction within the State to the extent of the value of the property. In the case of real property, in particular, preservation of the common law concept of quasi in rem jurisdiction arguably would avoid the uncertainty of the general International Shoe standard without significant cost to “traditional notions of fair play and substantial justice. (Powell, concurring)

The requirement of fair notice also, I believe, includes fair warning that a particular activity may subject a person to the jurisdiction of a foreign sovereign. If I visit another State, or acquire real estate or open a bank account in it, I knowingly assume some risk that the State will exercise its power over my property or my person while there. My contact with the State, though minimal, gives rise to predictable risks. (Stevens, concurring)

Feder v. Turkish Airlines (S. D. N. Y Feder v. Turkish Airlines (S.D.N.Y. 1977) (upholding attachment of bank account in NY as source of PJ for suit concerning accident in Istanbul)

We conclude, in sum, that the present attachment does not fall within Shaffer or offend the Constitution. The voluntary opening by THY of a bank account in New York satisfies the “minimum contacts” of International Shoe, as well as that requirement of foreseeability imparted by Shaffer into quasi in rem actions: the concept, that is to say, that the nonresident owner has undertaken acts with respect to the attached property which placed him on notice of the possibility of his having to defend such property in the foreign forum.

is there specific in personam jurisdiction on the basis of other contacts with Delaware?

§ 3114 Service of process on nonresident directors, trustees, members of the governing body or officers of Delaware corporations. (a) Every nonresident of this State who after September 1, 1977, accepts election or appointment as a director, trustee or member of the governing body of a corporation organized under the laws of this State or who after June 30, 1978, serves in such capacity, and every resident of this State who so accepts election or appointment or serves in such capacity and thereafter removes residence from this State shall, by such acceptance or by such service, be deemed thereby to have consented to the appointment of the registered agent of such corporation (or, if there is none, the Secretary of State) as an agent upon whom service of process may be made in all civil actions or proceedings brought in this State, by or on behalf of, or against such corporation, in which such director, trustee or member is a necessary or proper party, or in any action or proceeding against such director, trustee or member for violation of a duty in such capacity, whether or not the person continues to serve as such director, trustee or member at the time suit is commenced.

P brings a quiet title action concerning CA land in CA state court intended to bind the world Any problem with this in rem action given Shaffer?

P brings a quiet title action concerning shares in a Del P brings a quiet title action concerning shares in a Del. corporation current held by an Arizonan the suit is brought in Del. state court and is intended to bind the world any problem with this in rem action given Shaffer?

Burnham v. Superior Court (U.S. 1990)

Scalia’s opinion (with Rehnquist, Kennedy and White)?

PJ exists only if it was the shared understanding at the time of the ratification of the Constitution in 1787?

PJ exists only if it was the shared understanding at the time of the ratification of the 14th Amendment in 1868?

PJ exists only if it was the shared understanding at the time of the ratification of the 14th Amendment in 1868 OR it satisfies Int’l Shoe?

how to distinguish Shaffer?

It goes too far to say, as petitioner contends, that Shaffer compels the conclusion that a State lacks jurisdiction over an individual unless the litigation arises out of his activities in the State. Shaffer, like International Shoe, involved jurisdiction over an absent defendant, and it stands for nothing more than the proposition that, when the "minimum contact" that is a substitute for physical presence consists of property ownership, it must, like other minimum contacts, be related to the litigation.

In [Shaffer], a Delaware court hearing a shareholder's derivative suit against a corporation's directors secured jurisdiction quasi in rem by sequestering the out-of-State defendants' stock in the company, the situs of which was Delaware under Delaware law. Reasoning that Delaware's sequestration procedure was simply a mechanism to compel the absent defendants to appear in a suit to determine their personal rights and obligations, we concluded that the normal rules we had developed under International Shoe for jurisdiction over suits against absent defendants should apply -- viz., Delaware could not hear the suit because the defendants' sole contact with the State (ownership of property there) was unrelated to the lawsuit.

Glannon: “Justice Scalia and three other justices concluded that the Shaffer opinion really meant to say that assertions of in personam, quasi in rem, and in rem jurisdiction had to meet the Int’l Shoe standard, not that Int’l Shoe applied to other bases for personal jurisdiction, like transient presence.”

The short of the matter is that jurisdiction based on physical presence alone constitutes due process because it is one of the continuing traditions of our legal system that define the due process standard of "traditional notions of fair play and substantial justice."

It is fair to say, however, that while our holding today does not contradict Shaffer, our basic approach to the due process question is different. We have conducted no independent inquiry into the desirability or fairness of the prevailing in-state service rule, leaving that judgment to the legislatures that are free to amend it; for our purposes, its validation is its pedigree, as the phrase "traditional notions of fair play and substantial justice" makes clear. Shaffer did conduct such an independent inquiry, asserting that "'traditional notions of fair play and substantial justice' can be as readily offended by the perpetuation of ancient forms that are no longer justified as by the adoption of new procedures that are inconsistent with the basic values of our constitutional heritage.“ Perhaps that assertion can be sustained when the "perpetuation of ancient forms" is engaged in by only a very small minority of the States. Where, however, as in the present case, a jurisdictional principle is both firmly approved by tradition and still favored, it is impossible to imagine what standard we could appeal to for the judgment that it is "no longer justified."

Scalia if traditional at the time of the enactment of the 14th Amendment and generally used by the states today then constitutionally permissible expanded by Int’l Shoe, but not contracted

Brennan (with Marshall, Blackmun, and O’Connor)?

set aside tagging – does PJ in Burnham satisfy Int’l Shoe?

The transient rule is consistent with reasonable expectations, and is entitled to a strong presumption that it comports with due process. “If I visit another State, . . . I knowingly assume some risk that the State will exercise its power over my property or my person while there. My contact with the State, though minimal, gives rise to predictable risks.” Shaffer (STEVENS, J., concurring in judgment); see also Burger King Corp. v. Rudzewicz(1985) ("[t]erritorial presence frequently will enhance a potential defendant's affiliation with a State and reinforce the reasonable foreseeability of suit there")

Scalia on Brennan?

Brennan’s response?

what about the McGee factors…?

specific in personam jurisdiction (w/o tagging added) - International Shoe power theory - McGee factors

general in personam jurisdiction over corporations - International Shoe power theory (as modified by Daimler) - McGee factors…?

forms of PJ that are unproblematic under Pennoyer and Int’l Shoe domicile as a source in general in personam jurisdiction over individuals in rem

if it is a form of PJ that was good under Pennoyer if it is a form of PJ that was good under Pennoyer... Scalia test - if OK under Pennoyer and generally used by the states today then constitutionally permissible Int’l Shoe could reasonably anticipate being haled into court

D is lured into a state and tagged PJ?

Terlizzi v. Brodie, 329 N.Y.S.2d 589 (N.Y. App. Div. 1972)

the CEO of the D. Corp is tagged in CA PJ in CA?

A, a partner of the partnership, A & B, is tagged in CA PJ in CA?

A is domiciled in CT B is domiciled in NJ A & B’s offices and all of its work is done out of NY where is there in personam PJ (setting aside tagging)?

NY makes the appointment of an agent for service of process a condition for doing business in NY can this create general jurisdiction?

waiver/consent