Personal Jurisdiction (In personam)

Federal Statute Provisions

- A federal court applying state law, then they must apply the standard of interpretation for the long-arm statute. (RULE 4(k)(1)(A) - Exceptions: when a federal statute provides otherwise: 4K1c (any federal statute - ex. bankruptcy), 4k2 (claims under federal law), 4K1B (bulge rule-joinder)

Requirements for jurisdiction over the parties under 14th amendment

1. The court must have the power to act, either upon given property, or on a given person so as to subject him to personal liability. This is a requirement of substantive due process.

Requirements for jurisdiction under 14th amendment

2. The court must have given the defendant adequate notice of the action against him, and an opportunity to be heard.. This is a requirement of procedural due process.

Daimler AG v. Bauman

22 Argentinian residents filed a complaint in California against Daimler, a German public stock company, headquartered in Germany. Claim stated that Daimler's Argentinian subsidiary, Mercedes-Benz Argentina collaborated with state security forces to kidnap, detain, torture, and kill MB workers in Arg. Jurisdiction was predicated on the California contacts of Mercedes Benz USA, a subsidiary of Daimler incorporated in Delaware with its principal place of business in NJ. MBUSA distributes Daimler-manufactured vehicles to independent dealerships throughout the U.S., including California. H:Daimler is not "at home" in California, and cannot be sued there for injuries plaintiffs attribute to MB Argentina's conduct in Argentina. MBUSA's contacts in California relative to its overall operation are quiet high, but even if those contacts are attributable to Daimler AG, Daimler AG's contacts in California are "slim" by comparison to its worldwide contacts. Daimler nor MBUSA is incorporated in California, nor does either entity have its principal place of business there. Court said that under exceptional circumstances, a corporation might also be "at home" in other jurisdictions besides principal place of business

Establishing Min Contacts

Actions purposefully directed are: • Prior negotiations • Contemplated future consequences along with • Terms of contract and • Parties' actual course of dealing

Asahi Metal Industry Co. v. Superior Court of California

Asahi was impleaded by Chen on a product's liability suit. Over five years, Asahi shipped tubes to Chen; Chen then sold tubes around the world including the U.S. sales in California. There was evidence that Asahi was aware that the valves it sold to Chen would end up in the U.S. However, Asahi made no direct sales in California, had no offices or agents there, and did not control the system of distribution that carried its products into the state. ii. Holding: Despite min contacts, it would be unreasonable and unfair. 1. Burden to Asahi of defending in a foreign legal system 2. The slenderness of California and Chen's interests in having the indemnity claim heard there and 3. The strong federal and state interest in not creating foreign relations problems by deciding an indemnity claim between two foreign defendants.

Principle: 2 kinds of Jurisdiction

Before a court can decide a case, it must have jurisdiction over the parties as well as over the subject matter. It must have jurisdiction not only to decide the kind of case before it, but also jurisdiction to decide a case between the particular parties, or concerning the property, before it.

Enumerated Long-arm statutes

Consist of specific provisions allowing for general circumstances of jurisdiction

Minimum Contacts Requirement

D has to have taken actions that were purposefully directed towards the forum state.

Min Contacts Claim

D may not be sued for any claim where min contacts activities were established, but only for claims arising out of the in-state activities.

Jackson v. California

Defendant's articles and websites were local and published in California about Bo Jackson, an Illinois resident. Jackson sued for damages suffered as a result of alleged defamation. Defendants move to dismiss plaintiff's action for lack of personal jurisdiction under 12b2. Min Contact: 1. Was it purposely directed towards the forum state? 2. Was it reasonable? • Zippo Rule: o If defendant conducted activities through an interactive website, it could be subject to specific jurisdiction in a distant state o If the website is purely passive that convey information, but have little if any interaction with visitors, the defendant is not subject to personal jurisdiction in a distant state. o If the interactivity falls short of an actual purchase, there is a close examination of the • Nature and • Extent of the site's interactivity. There is no min contacts activity: The defendants did not contact Illinois sources, did not focus the story on Illinois or any event that occurred in Illinois, and did nto know that plaintiff resided in Illinois. No Internet newspaper subscribers resided in Illinois. The reputation is in a national scope. The website is passive and has no Internet activity for Illinois residents. It does not grant personal jurisdiction.

Specific

Each claim must arise out of defendant's contact with the forum, and the exercise of jurisdiction must be consistent with traditional notions of fair play and substantial justice.

Notice

Even if a defendant's contacts in a state suffice to subject her to personal jurisdiction there, the court must assert jurisdiction over her by an order to appear and defend the action. This is usually accomplished through service of process, delivery to the defendant of the intial papers in the action.

McGee v, International Life Insurance

Franklin, a resident of California, purchased a life insurance policy from International Life Insurance Co. D mailed a reinsurance certificate to Franklin in California offering to insure him. Franklin accepted the offer and paid premiums by mail from his California home to Defendant's office in Texas until his death in 1950. When the beneficiary, Plaintiff McGee, notified Defendant of Franklin's death, they refused to pay. Neither the original insurer nor respondent ever had any office or agent in California. The Supreme Court found that it is sufficient for purposes of due process that the suit was based on a contract that had substantial connection with California. A state has a manifest interest in providing effective means of redress for its residents when their insurers refuse to pay claims.

Rule

How many contacts the defendant has in the forum state relative to its contacts elsewhere.

Rule to Specific Jurisdiction

In order to have jurisdiction over D, there must be: 1. Min Contacts a. purposefully availed itself 2. But for the contact, the claim would not have arise. Only jurisdiction where the injury was done. 3. Is it fair and reasonable

In rem

Jurisdiction over a thing, gives the court power to adjudicate a claim made about a piece of property or about a status. An action to quiet title to real estate, adm an action to pronounce a marriage dissolved.

In Personam (Personal Jurisdiction)

Jurisdiction, or jurisdiction over the defendant's person, gives the court power to issue a judgment against him personally. This judgment can then be sued upon in other states, and all of his assets may be seized to satisfy the judgment.

Exception to Min Contacts

Minimum contacts will not suffice if considerations of substantial notice and and fair play would make D defend in the forum state so unreasonable.

World Wide Volkswagen v. Woodson

P sued in Oklahoma for injuries suffered there in an accident involving an allegedly defective car; they had purchased the car in New York while they were NY residents. The D's were the distributor of the car (a non-Oklahoma resident who distributed only in NY, NJ, and Conn.) and the dealer (non-Oklahoma resident whose showroom was in NY). Neither the distributor nor the dealer sold cars in Oklahoma or did any other business there. Holding: Even though it may have been forseeable that the defendants might derive revenue from a car ultimately used in Oklahoma, it is not sufficient to confer jurisdiction. Defendant's conduct and connection with the forum state are such that he should reasonably anticipate being haled into court there.

Two ways to establish personal jurisdiction under the new framework

Specific and general.

LONG-ARM STATUTES

State legislatures enact statutes to decide if a state has the authority to exercise jurisdiction over a defendant. - According to 14th Amendment, a defendant must be afforded Due Process from a STATE - "No State shall ... deprive any person of life, liberty, or property, without due process of law...."

Quasi in rem jurisdiction

The action is begun by seizing property owned by attachment, or debt owed to garnishment the defendant, within the forum state. This is different from in rem jurisdiction because here the action is not really about the thing seized; instead the thing seized is a pretet for the court to decide the case without having jurisdiction over the defendant's person. Judgment only affects the property seized, and cannot be sued upon in any other court.

Minimum Contacts

The court can only exercise juristiction unless D has minimum contacts with the state in which the court sits. Minimum contacts satisfies the right to due process.

General Jurisdiction

The defendant's contacts are sufficiently extensive that the defendant would be considered "at home" in the state (for corporations) or domiciled there (for individuals). Under General Jurisdiction, the claim doesn't have to arise out of the contact in the state, but there is also jurisdiction where D is practically at home.

Reasoning:

There is no much burden to defend a case where the D is practically at home. Can be where the corporation is incorporated, has its headquarters, and has more contacts in that state than elsewhere.

Burger King v. Rudzewicz

This case was over a contractual relationship. The contract allowed D, an individual residing in Michigan, to run a fast food restaurant in Michigan under franchise from P(burgerking), which had its headquarters in Fl. Lawsuit brought by burgerking. The agreement provided that Florida law would control. i. Contacts with the state: D never traveled to FL in connection w/contract or restaurant. D's face to face meetings w/burger king officials were in the local Michigan office, not FL. ii. Long Arm Statute: FL long arms allows jurisdiction over D's who "braches a contract in this state by failing to perform acts required by the contract to be performed in this state," so long as the cause of action arose from the alleged breach of contract. iii. Holding: By signing a contract with such provision, the out of stater has "purposely availed himself of the benefits and protections of the forum state's laws. 1. Other factors: 1. Prior negotiations and contemplated future consequences 2. Along with the terms of the contract and the parties' actual course of dealing iv. Fraud or bargaining advantage: D was an experienced accountant who spent five months negotiating the contract, and who was represented by counsel. Although Burger King may have had bargaining advantage, its advantage was not great as to constitute fraud or economic duress.

But for Test

a claim arises out of a contact if the claim would not have arisen but for the defendant's contact with the state. This is a more expansive approach to personal jurisdiction.

Evidence Test

a claim arises out of the defendant's in-state contacts only if the defendant's forum contact provides evidence of one or more elements of the underlying claim.

Note:

a court must have personal jurisdiction over each individual claim. A court cannot typically assert personal jurisdiction over the entire case simply because the court has personal jurisdiction over one of the claims.

Every personal jurisdiction has:

a statutory component (long arm statute) and constitutional component (due process).

Fifth amendment

bars the federal government from taking a person's life, liberty, or property without due process of law. When a court enters a judgment against a defendant, it interferes with both liberty and property. So it must act in accordance with due process.

Arises Out of Element

evidence test and but for test

Service Process

fulfills two functions: it formally assert the court's authority over the defendant and it informs her of the case so she can prepare to defend it.

International Shoe

i. Held some states have statutes allowing jurisdiction over non-residents who conduct unincorporated businesses within the state. ii. Here: International Shoe Co. was incorporated in Delaware and had its headquarters in Missouri, but the firm conducted activities of its Washington-based salesmen, who solicited orders for the firm. The salesmen had no authority to enter into contracts; all orders had to be pre-approved by the home office. Orders were shipped to Washington from the home office in Missouri. iii. Rule: Court holds that states may exercise personal jurisdiction over a defendant if she has such minimum contacts with the state that it would not offend "fair play and substantial justice" to hale her to court there.

Personal Jurisdiction

is the power of a court to issue a binding judgment against a defendant.

QUASI-IN-REM

jurisdiction over person, by using property in forum state to satisfy judgment • claim not about the property • recovery is limited to the value of the property

IN REM

jurisdiction over property

History

o A court must have the authority to require the defendant to appear in the forum and defend the action there. This judicial authority is referred to as personal jurisdiction. The Constitution imposes important restrictions on a court's authority over defendants. Specifically, the 14th Amendment provides that a state may not deprive a person of property without due process of law. o Every personal jurisdiction inquiry has a statutory component (long arm statute) and constitutional component (due process).

Catch-all Provisions

o A few states have enacted catch-all provisions allowing a state to exercise full constitutional jurisdiction. o Example: California

Bensusan Restaurant Corporation v. King

o Blue Note jazz club (MO) is sued by Blue Note jazz club (NY) for trademark infringement, but NY long-arm statute only allows for jurisdiction when a defendant "commits a tortious act within the state." • Blue Note (MO) did not commit tortious action by posting Blue Note (NY) information on its own website, or employing the same name for business in MO. • The act must occur there, not damages. (Interpretation) • This is not covered by the Long-arm statute. • Case was dismissed for lack of statutory authorized personal jurisdiction. • NY does have constitutional personal jurisdiction, however, because it had contact with the state of NY, through Blue Note (NY), but without statutory authorization, there is no personal jurisdiction.

Shaffer v. Heitner (1977)

o Heitner sues Shaffer, a business executive of Greyhound, in a shareholder's derivative suit. Greyhound is a Delaware corporation with its principle place of business in Arizona and Heitner is a domicile NOT of DE. The stock used for Quasi-In-Rem jurisdiction was "in" Delaware. • Without contacts, or specific/general jurisdiction, the use of the stock to sue Shaffer a non-DE resident (served and sued as an individual and not a representative of his company) by another non-DE resident is no longer constitutional. o Issue: whether International Shoe's minimum contacts standard of fairness and substantial justice applied to in rem actions • Makes International Shoe the standard for all state court jurisdiction • "all" is debated in Burnham below • NO MORE quasi-in-rem cases since minimum contacts analysis is now required and attaching property alone is insufficient o Appellants have not purposefully availed themselves in Delaware and as such have not established minimum contacts.

Burnham v. Superior Court (1990)

o Issue: whether CA courts can exercise personal jurisdiction over a nonresident who was personally served with process while temporarily in that State, in a suit unrelated to his activities in the state. • Scalia's plurality opinion: • Mere presence is still sufficient because it is one of continuing traditions of our legal system → just because the standard of presence had been lowered in International Shoe, physical presence still satisfied due process; minimum contacts analysis unnecessary if there is presence. • States can decide whether to exercise jurisdiction • MOST COURTS FOLLOW SCALIA • Brennan's concurrence: • Shaffer said all cases must look at minimum contacts → jurisdiction is still fair because travel is easier for husband, he chose to go to CA, and he purposefully availed himself

Specialized Long-arm provision

o Often apply to specific kinds of activity • Nonresident motorist statutes(i.e. Hess) • Business registration statutes • Force out of state business to consent to in-state jurisdiction if they wish to conduct business within the forum state. (see Shaffer, statute enacted ex post facto).

Over extending and Shortening

o Over extending - enacting a statute for jurisdiction which is unconstitutional o Shortening - creating very specific jurisdiction which limits the constitutionally granted amount.

Mullane v. Central Hanove Bank & Trust Co. (1950)

o 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. o Personal service is ALWAYS adequate (the best), but not necessary to nonresident defendants o Publication: • Alone: • To defendants whose interests or addresses are unknown = reasonable • To known addresses = unreasonable • + attaching property is reasonable since there is an assumption that defendant will have someone watching his property. • To LARGE classes of people = okay as long as it is calculated to reach most of those interested in objecting, reasonable to assume that in large classes notice might not actually reach all o Notice must be "reasonably calculate under the circumstance to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections" • Must be reasonably calculated to reach those who could easily be informed by other means at hand. • Most objections would be raised by someone who is alerted to the lawsuit, so anyone who is not noticed will still be represented in the suit. o Holding: State statute unconstitutional since it deprives known persons whose whereabouts are also known of substantial property rights