Civ Pro Notes Part Iia Personal Jurisdiction

Pennoyer v. Neff 95 U.S. 714 (1877) pg. 61 Facts • D hired an attorney but then failed to pay him ○ Attorney filed suit in Oregon (D is not a resident of Oregon)  Neff was served process by printing in the paper => probably didn’t see it ○ Trial court entered default judgment against D for not appearing • D acquired land from federal government, lawyer demanded it be sold and his fee paid ○ Sheriff sold the land to P • D then sued P to reacquire the land Procedural Posture • Trial court found for Neff (non-resident) because of a technicality ○ Pennoyer sued Issues: 1. Is constructive service by publication legal? 2. Does the state of Oregon have jurisdiction in personam over Neff? 3. Does the state of Oregon have jurisdiction in rem over Neff, or Neff’s stuff? 4. Was it appropriate to sell the property before it was attached (seized)? 5. If the first lawsuit cannot be upheld, does the sale of the property to Pennoyer count? Main Issue: Was it legal for Oregon to register a judgment against Neff without personal service of process? Rules 1. 2. 3. 4. 5.

A state has exclusive jurisdiction over people and property within its borders. No state can exercise jurisdiction over people or property in other states. Judgments in personam without personal service of process shall not be upheld. Judgments in rem with only constructive service may be upheld. The “Full Faith and Credit” clause of the Constitution only applies “when the court rendering the judgment had jurisdiction of the parties and of the subject-matter”.

Conclusion The original verdict of Mitchell v. Neff was invalid because the state of Oregon did not have jurisdiction in personam over Neff. Therefore, the judgment shouldn’t have happened and the property should have never been sold. Consequently, the court upheld the decision in Neff’s favor.

International Shoe Co. v. Washington 326 U.S. 310 (1945) pg. 75 Facts • State of Washington sued International Shoe to recover unpaid contribution’s to state unemployment fund ○ International Shoe did not have an office in Washington, but employed 11-13 salesmen there who conducted business on International Shoe’s behalf • When Washington sued the company, they served notice personally to one of the salesman and mailed a notice to the company’s St. Louis headquarters • Washington Supreme Court upheld the state’s right to sue Issue • Did International Shoe’s activities in Washington make it subject to personal jurisdiction in Washington courts? Holding • Yes. Minimum contacts with the forum state can give a court in that state personal jurisdiction over a party without violating the Due Process clause Reasoning • Test is subjective as to the minimum contacts requirement ○ Minimum contacts does not offend traditional notions of fair play and substantial justice • International Shoe had conducted “systematic and continuous” business in Washington. ○ A large volume of interstate business for the defendant was created through D’s agents in the state and D received the benefits and protection of the state’s laws.  If you enjoy the protection of the laws of a state, you also have the obligations ○ D had established agents in the state permanently. • Quality and nature of the contacts is to be analyzed, not simply the quantity ○ There was sufficient notice of the suit

In personam jurisdiction: A court’s power to bring a person into its adjudicative process Jurisdiction over a defendant’s personal rights In rem jurisdiction: A court’s power to adjudicate the rights to a given piece of property Including power to seize and hold it McGee v. International Life Insurance Co. 335 U.S. 220 (1957) • P bought life insurance policy who had headquarters in Texas ○ P lived in California and paid premiums from there • Court held that P could sue D in California court even if D didn’t have office in that state ○ Suit was based on a contract which had substantial connection with the state ○ California has a interest in providing effective means of redress for its residents Hanson v. Denckla 357 U.S. 235 (1958) • Woman lived in Pennsylvania, set up trust in Delaware, then moved to Florida ○ P argued that Florida court had jurisdiction over the case ○ D (trust company) said no because they didn’t have minimum contacts with state of Florida • Court held that Florida court lacked jurisdiction ○ Trust company did not have minimum contacts with the state of Florida ○ It did not purposefully avail itself of the protections of Florida law, thus it doesn’t have the responsibility to follow its law  Unilateral decision by trust creator (P’s mom)

Shaffer v. Heitner 433 U.S. 186 (1977) pg. 86 Facts • P (Appellee) sued D (Appellant), officers of Greyhound Corporation ○ Simultaneously with his suit, he filed a motion for sequestration of the Deleware property of the individual defendants ○ This entailed the state seizing some stock that D had held • D sued to have this sequestration overturned, said it violated Due Process cause of Constitution and failed to take into consideration ‘minimum contacts test’ as laid out by International Shoe Issue Whether a Delaware statute that allows a court of that State to take jurisdiction of a lawsuit by sequestering any property of the defendant that happens to be located in Delaware is constitutional? Arguments for D • They did not have minimum contacts with the state ○ Also, sequestration would allow possibility of decision without hearing ○ Property is unrelated to P’s cause of action Arguments for P • International Shoe does not apply because state is invoking in rem not in personam jurisdiction Holding • D does not have minimum contacts with the state, statute violates Due Process Clause Reasoning • International Shoe ‘minimum contacts test’ applies for in rem jurisdiction ○ If property had been real property, Delaware probably would have had jurisdiction because they enjoyed the protection of Delaware’s law ○ But when property is simply incorporated in Delaware, they can’t be expected to have any contacts • Further, purposes of statute was simply to assure that they would appear before the court ○ This does not seem to indicate that they tried to take into account the contacts the people had with the state Delaware's assertion of jurisdiction over appellants, based solely as it is on the statutory presence of appellants' property in Delaware, violates the Due Process Clause, which "does not contemplate that a state may make binding a judgment . . . against an individual or corporate defendant with which the state has no contacts, ties, or relations."

World Wide Volkswagen Corp v. Woodson 444 U.S. 286 (1980) pg. 96 Facts and Procedural Posture • Car sold in N.Y. driven by P was in car accident in Oklahoma ○ Dealership and distributor had no business with Oklahoma at all  Only connection was the fact that the car was driven in Oklahoma at the time • Oklahoma Supreme Court held that it could exercise personal jurisdiction ○ It was foreseeable that the car could be driven in Oklahoma • Supreme Court reversed Reasoning • Minimum Contacts Test has two functions: ○ Protects D against the burdens of litigating outside state ○ Ensures that states don’t reach too far • D has no ties whatsoever with Oklahoma ○ Foreseeability is not a benchmark for personal jurisdiction • It would not be a violation of Due Process if corporation delivers its products into the stream of commerce or tries to sell goods to consumers in the state Dissent • Court did not take into account: ○ forum State’s interest in the case ○ The actual inconvenience to D Consumer’s unilateral act of bringing D’s product into the forum state was not sufficient constitutional basis for personal jurisdiction Asahi Metal Industry Co v. Superior Court 480 U.S. 102 (1987) pg. 105 Facts and Procedural Posture • Motorcycle tire blew out, man sued manufacturer for product liability in California • California court found that he could sue ○ Supreme Court reverses Reasoning • In order for minimum contacts to hold, D must purposefully direct an action toward the forum state ○ Simply placing a product into the stream of commerce is not enough • Must look at ○ Burden on D ○ Interest of forum state ○ P’s interest in obtaining relief • In the current case, heavy burden on D, slight interest for both State and P

Burger King Corp. v. Rudzewicz 471 U.S. 462 (1985) pg. 111 • The defendant started a Burger King franchise. ○ Things went sour and Burger King sued in federal court in Florida to terminate the franchise. ○ Rudzewicz challenged the court’s personal jurisdiction.  District court found for P, Circuit Court reversed, finding for D • Supreme Court reverses, finds for Burger King Reasoning • Foresseability is that D’s conduct with forum State is such that he should reasonably anticipated being haled into court there ○ D’s contract had substantial ties with state Dissent • D dealt primarily with Michigan office ○ Boilerplate language of contracts should not be enough to confer jurisdiction Pavlovich v. Superior Court 29 Cal. 4th 262, 58 P.3d 2 (2002) pg. 117 • D put links on website to circumvent source code ○ This source code was owned by company in California • District Court held the company had jurisdiction ○ Appeals court reversed • P’s arguments: D knew that positing the info. would harm California companies ○ Court holds this not to be true » D had no idea it would hurt specific California companies  Causation is too remote • Court is quick to emphasize narrowness of decision ○ Knowledge alone is insufficient to establish express aiming at the forum state, but it can be used as evidence of jurisdiction ○ Further, court says he could be sued in Indiana or Texas (potentially) Dissent • D knew that actions would hurt industries, regardless of where specifically they were located Coastal Video Communications Corp. v. The Staywell Corp (E.D. Va. 1999) pg. 126 • Example of a case asking for further evidence of the extent of contacts with the forum state, on the theory that there might conceivably be enough for general jurisdiction

Burnham v. Superior Court 495 U.S. 604 (1990) Issue: Does the 14th Amendment deny California courts jurisdiction over a non resident, personally served with process while temporarily in the State, in a suit unrelated to his activities in the state? Facts and Posture • D was travelling in California to visit kids ○ Wife had filed for divorce in California, D served with summons while there ○ D was resident of New Jersey • California courts held that they had personal jurisdiction ○ Supreme Court affirms Reasoning • D tried to argue that he can only be served process for the purpose of his visit in the state ○ Meaning his minimum contact had nothing to do with divorce so California shouldn’t have personal jurisdiction • Supreme Court holds that operative standard is whether traditional notions of fair play and justice have been observed ○ It has always been the case the a state could exercise personal jurisdiction over all those in the state for however short a time Concurring Opinion • D had availed himself to the benefits of California laws by visiting the state ○ Further, his burden is limited because he was already there ○ He could also file suit there as a plaintiff Carnival Cruise Lines, Inc. v. Shute 499 U.S. 585 (1991) Facts and Posture • On ticket, it said that suits may only be brought in Florida ○ P sued D for slip and fall accident in Washington ○ Circuit Court would not enforce forum-selection clause contained in the ticket • Supreme Court reverses, holds that forum-selection clause is enforceable Reasoning • Reasons for forum-selection clause are legitimate ○ Cruise line has special interest in limiting fora into which P can bring suit ○ Spares litigants time and expense of pre-trial motions • Forum selection clauses are subject to judicial scrutiny for fundamental fairness ○ Carnival did not invoke it as a bad-faith maneuver Dissent

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Believes forum-selection clauses are not applicable when they were not freely bargained for, create additional expense for one party, or deny a party a remedy

Mullane v. Central Hanover Bank & Trust Co. 339 U.S. 306 (1950)pg. 141 Facts and Posture • Central Hanover Bank (P) 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 Surrogate’s Court for a judicial settlement of the trust. ○ The only notice provided to beneficiaries was via publication in a newspaper.  Statute required only newspaper notification ○ Mullane (D) was appointed attorney and special guardian for a number of beneficiaries who either were unknown or did not appear. • Mullane objected to the statutory provision for notice by publication ○ The Surrogate’s Court overruled Mullane’s 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. Issue Is notice given to out of state parties by publication in a newspaper, when the parties’ addresses were known, constitutional in light of the Due Process Clause of the 14th amendment? D’s Arguments • Statue’s authorization of notification only by statute was unconstitutional under 14th Amendment ○ Fundamental requisite of 14th Amendment was right to be heard Holding The newspaper notice is incompatible with the requirements of the 14th Amendment as a basis for adjudication depriving known persons whose whereabouts are also known of substantial property rights Reasoning • Notice must be reasonably calculated, under all circumstances, to apprise interested parties of the pendency of the action ○ Also gives them opportunity to present their objections • In regards to people whose whereabouts are unknown, court holds that newspaper notification will suffice ○ It is unreasonable to expect Trustee to hunt down everybody • In regards to people whose addresses are known, company has a duty to inform them

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Even notifying a few of the people would satisfy requirement Their interest in the interest of the whole group, so they would object  Notification must be reasonably calculated to reach those who have an interest in it