1) Physical Presence and Transient Jdx

PERSONAL JURISDICTION
Traditional Bases of Jurisdiction
Personal Jurisdiction:

-1) Physical presence and transient jdx

“Transient rule” D tagged with service of process no matter how fleeting presence in state

-2) Voluntary appearance in court

D appears in court w/o making timely objection to jdx

-3) Consent to service on an agent: express or implied consent

Statute that provides non resident motorists operating vehicles was equivalent to appointing state registrar of motor vehicles as agent for service of process

-4) Domicile

Domicile is the state a person has taken residence w/ intent to remain permanently or indefinitely

In Personam/In Rem and Quasi in Rem Jurisdiction:

-In personam: Judgment entered ordering D to pay P a certain amount of money

“Open box” that P can use to attach property belonging to D until full amount of judgment is paid

-In rem: judgment awarding P property that was attached as basis of jursidcition

“Sealed box” cannot be used to reach other property belonging to D
“Against all the world” binds everyone whether party to suit or not
Quasi in rem: affects interests people who have been made parties to suit and have property attached
Minimum contacts required for jdx

Corporations and Traditional bases of Jurisdiction

-Domestic corporations

-Foreign corporations:

“Doing business” test (stretching traditional bases of jdx) whether extent and continuity of what it has done in state makes it reasonable to bring it before one of its courts

Long Arm Jurisdiction and Minimum Contacts Test

-Step 1) Long Arm Statute

Tailored/Specific act: specific language in the state statute
Due-process type (CA): authorizes courts to assert long-arm jdx to max extent permitted by the Constitution
Federal long-arm 4(k)(1)(A): federal court borrows from state in which it sits
Court is either limited by state’s due process long-arm statute or tailored long-arm statute

-Step 2) Minimum Contacts

1. Purposeful availment
A) Activities in the state
International Shoe v. Washington: sales employees were employed in the state of Washington. Held: D had activities in the state
Comp w/ Hess: someone was just driving through the state, held: not sufficient for activities
B) Contractual relationship with forum
Contractual relationships alone do not establish jdx

- Hanson v. Denkla: Rejects “center of gravity” where the center of controversy is. D’s activities were unilateral/fortuitous b/c the recipient of the trust moved to a new state (FL) where checks were forwarded to her in that state

- McGee v. Int’l Life Insurance Co: Key difference is that the insurance co D, re-solicited the P in the forum state

Substantial continuous relationship

- Burger King v. Rudzewicz: D received fair notice from the K documents that he may be subject to FL’s courts. Continuous contact w/ FL, payments sent there. Held: D made sufficient contacts w/ FL

Active v. Passive purchaser
Chalek v. Klein: D parties purchased product over the telephone (threshold for D purchasers to satisfy purposeful availment is higher than for D sellers). Active buyers would be someone vociferous, visiting the site of the seller or getting custom made products. A passive buyer must demonstrate more contacts to establish minimum contacts

C) Stream of Commerce (products liability)
SOC must include distributor, not resale market. Ends at retail line
VW. V. Woodson: No min contacts b/c car was bought in NY and accident occurred when P drove car to OK. Contacts could not be based on P’s unilateral action of driving car to OK
SOC (Brennan): as long as D was aware of the SOC, purposeful availment is satisfied
SOC Plus (O’Connor): Asahi D needs something more than just awareness
McIntyre spectrum
Majority (Kennedy): Targeting the state, D must have targeted the state (similar to O’Connor’s SOC plus?)
Concurring (Breyer): Single v. Multiple sales factor multiple sales giving rise to purposeful availment
Dissent (Ginsberg): Fair and reasonable standard. D was targeting the US as a whole market and any state is a forum where marketing was successful b/c taking advantage of those laws. Foreseeability as a factor
D) Effects in the forum (torts)
Requirements:
1) D committed intentional tort
2) Forum is focal point of harm suffered: P felt brunt of harm in forum state
3) D, knowing harm would be felt there, expressly aimed tortious conduct at forum
Calder v. Jones
Revell v. Lidov: Held: defamatory publication was not connected in any way to forum. P did not even know D resided in forum
Internet website/Zippo test (sliding scale)
“Passive” site: merely allows owner to post information on website- usually not enough
“Active” site: clearly does business over internet w/ customers: enters into Ks and knowing and repeated transmission of files over internet (Amazon)
In between: user can exchange information w host but jdx determined by examining level of interactivity and commercial nature of exchange
LL Bean ex:

2. Relatedness
A) General Jurisdiction (Continuous, substantial, systematic and unrelated): unrelated to underlying controversy but activities of D give court general jdx
Good Year v. Brown (“at home” test)
*Alternative test for SOC contacts if end sale is not from retailer, can try establishing general jdx over retailer in forum based on business activities there
Helicopterios: Held: no substantial contacts w/ forum based on sending CEO there, Ks for a lot of money, bank accounts, purchasing helicopter equipment, sending personnel for training
Perkins: Held: Forum was corporations principal, if temporary, place of business. D transferred all of office documents to forum
Substantial sales via website: Rose Furniture: Rose’s solicitation and sales activities combined w/ interactive website allowing 2.2 mill Texans to make purchase gen jdx in TX
B) Specific Jurisdiction (related): affiliation btwn forum and underlying controversy
1) “But for” test: embraces every event that in hind sight can be linked in causation link
2) Proximate cause: foreseeability test (based on merits of case)
3) Substantial connection/ “Lies in the wake” test:
Nowak v. Tak How: Held: Advertising and solicitation, and booking P’s reservations in MA satisfied substantial connection test b/c made it foreseeable that based on its contacts, people would come to hotel and swim in its pool

-Step 3) Reasonableness

Gestalt factors:
1) Burden on D- must be special burden
2) Forum’s interest in adjudicating the dispute
3) P’s interest in obtaining convenient and effective relief
4) Interstate judicial system’s interest in most efficient resolution of controversies (comparative)
5) Pertinent policy arguments: interests of other states in furthering their substantive policies
Asahi: D and P are no longer CA citizen and Taiwan or Japan’s laws would control
Nowak v. Tak How: Not enough that D is a foreign entity, has to show special burden

“Minimum Contacts” and Traditional Bases of Jurisdiction

-1) Quasi in rem requires minimum contacts:

Type 1: P has preexisting interest in property (min contacts satisfied)
Ex: suit by lender to foreclose on mortgage or suit by seller to repossess goods that seller owns
Type 2: P has no preexisting interest in property:
Type 2(a): Related to claim (min contacts may be satisfied)
Ex: Personal injury suit based on homeowner’s failure to maintain sidewalk on property
Shaffer v. Heitner: Shareholder’s connections and contacts w/ the state of DE where the co was incorporated did not provide enough contacts with the state
*After DE enacted statute providing for relationship between directors/officers of corp and state of incorp
Type 2(b): Unrelated to claim (min contacts cannot be satisfied, unless more contacts/other contacts est)
Consider all D’s contacts w/ the state not just ones relating to property

-2) Physical presence does not require minimum contacts:

Burnham v. Superior Court: D served while temporarily in the state: only requirement that you “intentionally” be in the state, doesn’t matter how long. Traditional notions of fair place and substantial justice not violated

Exercising Long Arm Under Federal Long-Arm Provisions

-1) [4(k)(1)(A): federal court borrows state’s statute]

-2) Federal long-arm Provisions

4(k)(1)(C): allows federal court to exercise personal jdx when authorized by federal statute
Federal interpleader authorizes world-wide service of process; Securities Exchange Act; Clayton Anti-Trust Act
4(k)(2): If D is not subject to any state jdx and exercise of jdx is constitutional (used as last resort if federal court cannot borrow state’s long arm for federal question case)
D just needs to have contact w/ US

-3) Minimum contacts at national level: Constitutionality based on “national contacts” with US as whole

Due process under 5th amendment
D must satisfy purposeful availment and relatedness
D can still rebut w/ reasonableness requirement

-4) Service w/in US: requires D to have min contacts w/ US as a whole

US citizen: min contacts test is irrelevant
D can motion to have case transferred to diff federal court
Foreign national min contacts will protect
Due process under 5th amendment forum must be fair and reasonable

-5) 100-mile bulge rule: (if borrowed state long-arm doesn’t reach or lacks min contacts for added parties)

Allows parties w/in 100 mile radius of federal courthouse to be added to suit
Rule 14/19- bringing party into suit
Cannot be used to acquire jdx over original D to suit

Challenging Lack of Jurisdiction Over Defendant

-Burden of Proof: Generally P must show by preponderance of evidence that court has jdx

Prima facie case allows P jdx’l discovery unless claim is clearly frivolous

-1) Direct Attack: D challenges jdx in first court

D shows up 1) files answer that includes challenge to jdx or to dismiss
State rules: proper manner of objection varies
Ex: some states if you combine objections this is deemed waiver of defenses
Federal rules:
12(b): motion to dismiss
12(g): D can join motions
12(h)(1): D waives defenses
Omission from motion waives 12(b) defense
If motion to dismiss denied D has right to challenge in appellate review
D doesn’t show up and default judgment entered
60(b)(4): D can request to vacate judgment on grounds that it is “void” for lack of jdxany time (this is not appeal)
Most courts say burden is back on D to show lack of jdx

-2) Collateral Attack: Default judgment entered against D and P takes judgment to another court. D can argue jdx in 2nd court

Denied motion to dismiss OR if waived in first trial No collateral attack available for D
Res judicata effect (if jdx was not found in collateral attack): P cannot relitigatejdx issue in any state seeking to enforce judgment

-Sanctions under Rule 11:

P runs risk of bringing case to court later determined to lack jdx
“Protective action” filing in a court where there is clearly jdx
Monetary sanctions if court finds attorney did not make reasonable prefiling inquiry into facts regarding jdx

Service of Process and Notice

-Requirement:

Step 1. Must comply with Rule 4
Step 2. Comport w/ due process and give adequate notice (14th and 15th amendment)

-Step1) Rule 4

Request for Waiver of Service of Summons 4(d)
Mailed with copy of complaint (not a summons) and gives a D 30 days to respond (unless outside the US-60 days)
Purpose: D avoids fees by waiving (fee for service, reasonable expenses, attorney’s fees and any motion to collect service expenses)
D gets another 30 days after waiver sent to answer complaint
*Statute of limitations may run after P waits for waiver to be returned and the 30 days if in a jdx where SOL is tolled with effective service of process
Formal Summons and Complaint
Individuals 4(e)
To individual himself
Dwelling or place of abode and left w/ suitable age or who resides there OR
Delivered to authorized agent
Corporation 4(h)
Summons and complaint to officer, managing agent or general agent or agent for service of process
American Institute of Certified Public Accountants v. Affinity Card: D had default judgment entered and filed a 60(b)(4) motion to vacate judgment. Held: Granted under Rule 4 office receptionist was not “integrated” enough to receive on P’s behalf (she was not employee).
Ds served in foreign countries
Method consistent w/ due process and minimize offense to foreign law
Substnatial compliance w/ Rule 4 factors:
1) Procedural posture of the case
2) Type of service involved
3) P made reasonable good faith mistake
4) D evading service
5) If relevant service provision is ambiguous
6) D received actual notice
7) Whether justice would be served by relaxed construction—allows the court to get to the merits of the case
Time limit for Effecting Service 4(m)
P has 120 days after complaint filed to effect service of process
Court can use discretion in extending time if P shows good cause for failure

-Step 2) Due Process Right to Notice

Step 1: Deprivation or potential deprivation of life, liberty or property
What is being deprived must be put into context of how “reasonable” service of process should be
Step 2: Deprivation amounted to violation of due process
Notice reasonably calculated under all circumstances to give D opportunity to be heard (one desirous of actually informing absentee)
Constructive service (substituted service): Notice by publication, posting notice on property
Mullane standard: Common trust and beneficiaries notified per NY statute in newspaper of settlement which binds everyone in a common trust. Trustees were deprived of right to answer to negligent impairments of their interest. The trust knew addresses of beneficiaries. Held: known beneficiaries should have been mailed. For those unknown it is not reasonable to expect them to be mailed therefore newspaper publication satisfies due process for those
Method reasonably certain to work:
1) P does not have to guarantee notice was received by D
2) P does not have to choose best method (e.g.: certified mail)
3) If method not reasonably certain to work, can’t pick one substantially less likely to work
4) Balancing test of public and private interest
5) Mere gesture is not reasonable and constructive notice not acceptable where mail is effective
*Exception: Tailoring service of process to D if P is aware of circumstances (case of mentally incompetent women, due process satisfied)
*English v. Spanish? Not violation of due process
Menonite (application of Mullane): Held: posting at courthouse and published announcement of tax sale of D’s property violated due process b/c potential deprivation of property and address could have been obtained
Requires due diligence
Notice by mail was more reasonable alternative
Posting rarely satisfies due process
Posting was meant to attract buyers
Jones v. Flowers: Held returned mail as unclaimed requires P to take additional reasonable steps to attempt to notify D. Generally if both restricted mail and regular mail sent and regular mail not returned but restricted mail returned, then due process satisfied

-Notice and Hearing when Property is Attached

Situations for attachment
1) In rem or quasi in rem: attach property at outset of suit before judgment
2) Repossession: P as pre-existing interest in good (usually installment Ks)
3) Security for judgment: D may not have money so attach property to ensure judgment
2 options:
1) State requires preseizure hearing (due process satisfied)
2) No preseizure hearing and employ safeguard
1) Pre-existing interest: Allege specific facts showing right to property
ex: documentary evidence of a K
2) Have to be reviewed by a judge (not clerk)
3) D must be given opportunity for prompt post seizure hearing
Doehr (When factors can be applied, narrowing): CT statute allowed pre-judgment attachment in a law suit for assault and battery that doesn’t require notice or bond and issued by attorney under oath. Held: probably cause to sustain validity is unconstitutional
Mathews Balancing test: 1 & 2 v. 3
Factor 1: Impact on property owner (D-based)
Attachment is intrusion of right, effects title to property, impairs ability to sell, taints credit, reduces chances of obtaining loan/mortgage
*LisPenden: note on property to potential purchasers that suit is pending- not as strong as attachment
Factor 2: Risk of erroneous deprivation and how it can be ameliorated by safeguards (D-based)
Ex: Tort cases usually high risk of erroneous deprivation
Factor 3: Exigent circumstances (P-based)
Even if exigent, bond must be posted
Ex: Something that is easily portable, devalues with time, previous experience of P w/ D’s track record

SUBJECT MATTER JUISDICTION
Overview
Definition: court’s authority to hear particular class of cases
Types of courts:

-General jdx: hears all kinds of civil cases (e.g.: CA Superior Courts)

-Limited jdx: only exercise jdx granted (e.g.: US DC)

Cannot waive SMJ
Challenge SMJ motion to dismiss Rule 12(b)(1)
Burden of proof on party bringing claim

Subject Matter Jdx in Federal Courts
Article III: Constitutional and Statutory Categories; this covers the full range of cases federal court can hear

-a) Arising under Constitution, laws and treatises of US

-b) Between citizens of different states

Federal Question Jdx
A) Article III “Arising under” federal laws: potential federal ingredient test- if there is any federal ingredient anywhere

-Osborn: Corporation chartered under act of Congress filed suit to enjoin state auditor from collecting allegedly unconstitutional state tax on bank and had federal ingredient in its original cause

B) Statutory “Arising under”

-USC 1331: District court shall have jurisdiction over all civil actions arising under Constitution, laws, or treaties of US if and only if:

-a) Creation test: Cause of action is created by federal law

i) Express federal statute that provides P a cause of action
*Shoshone exception: Shoshone cause of action arose under federal law b/c a federal program allowed individuals to stake mining claims but under this law, local law was to be applied so court said Congress did not create this right of action
ii) Implied right of action: statute created by federal law implied a class of people (judicially interpreted)
Factors to determine implied right
1) P is one of class for whose especial benefit statute was enacted
2) Indication of legislative intent, explicit or implicit to create or deny remedy
3) If implying remedy would be consistent w/ underlying purposes of particular legislative scheme
4) If claim in question is “one traditionally relegated to state law”
Ex: Bivens right of action: cause of action against any federal officer that has violated person’s 14th amendment right

-b) Essential federal ingredient test: Cause of action includes an essential federal ingredient

4 step test:
Step 1) Must be a federal ingredient embedded as an element in the state-created P’s claim (ie: P’s claim must rest on question of federal law)
Step 2) Federal ingredient must be disputed by both parties
Step 3) Element must be substantial: importance of having federal forum available for this type of claim
Ex: unconstitutionality or interpretation of federal statute
Step 4) “Welcome mat”- Would the federal recognition of this claim upset Congressional separation of federal/state jurisdiction? (implied Congressional veto)
Grable & Sons Metal Products v. Darue: Grable failed to pay taxes and IRS seized his property. Under federal law, IRS was required to give notice of seizure and 5 years later when IRS sold property to Darue, Grable claimed that exact manner in which he was served was improper under federal statute and brought action to quiet Darue’s title. Held: Satsifies essential federal ingredient test b/c underlying question is substantial and disputed by parties—whether Grable was served properly under federal statute. Also rare that a state quiet title action would involve federal law.

Well Pleaded Complaint Rule: Judicially created doctrine. Rule ensures only P’s claim for relief determines whether there is jdx under statutory arising under.

-Louisville &Nashville Railroad v. Mottley: Mottleys were injured as passengers by Louisville trains and as a release for their claims against the Railroad they were promised free transportation for life. 30 years later Congress passed statute that prohibited railroad from giving free passess. Mottleys sued Railroad for breach of K and sought order to compel Railroad to comply with agreement in federal court. Also alleged that Act of Congress did not apply to circumstances and if it did it deprived them of property. Held: P’s claim does not pass statutory arising under requirement b/c anticipated defense of a Congressional Act is not part of P’s original cause