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Conflicts of Law
University of Oklahoma College of Law
Gensler, Steven S.

Conflict of Laws                                                                                                         
Gensler
Spring 2010
                                                                                                                                                           
Name of the Game:  Forum Shopping
I.    Personal Jurisdiction – court’s power over parties to suit; part of horizontal forum shopping
      A.  Traditional Bases for PJ (over ∆) >> old theory:  power coextensive with territorial limits
            1.  Service in State
            2.  [Attachment of Property – but see  Shaffer below]             3.  Domicile –
                 a.  for individuals – last place of physical residence w/ intent to remain
                 b.  for corporations – place of incorporation (but not for SMJ purposes?)
            4.  Consent (e.g., Hess v. Pawloski: pre-Shoe, court accepted state-created legal fiction of consent)
            5.  Status Relationships, e.g., family law stuff >>> divorce, custody, etc.
      B.  Minimum Contacts-Based PJ >> new theory:  product of legal realism? 
o   per Shoe:  MC such that exercise of PJ does not offend TNFPSJ (frees courts from legal fictions)
o   per FRCP 4(k)(1)(A) – same power (read: same analysis) in fed. ct. as in state court . . .
1.  Two (?) Rationales:  Why need MCs at all?  (see WWV, tb. 391, 393)
     a.  ∆ protection:  to “protect[ ] the defendant against the burdens of litigating in a distant or inconvenient forum”
i.    DP “protects individual’s liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful ‘contacts, ties or relations.’ . . .  By requiring that individuals have ‘fair warning that a particular activity may subject [them] to the jurisdiction of a foreign sovereign, . . . the Due Process Clause ‘gives a degree of predictability to the legal system that allows potential defendants to structure their primary conduct with some minimum assurance as to where that conduct will and will not render them liable to suit.”  (BK)
ii.   per BK, the “fair warning requirement is satisfied if
    (I)    the defendant has “purposefully directed” his activities at residents of the forum (citing Keeton) and
    (II)   the litigation results from alleged injuries that “arise out of or relate to” those activities (but I think this second prong is superfluous!!!  Need “purposeful availment in general jurisdiction cases too . . . ) 
iii.  Big picture, in DP-liberty terms:  people should be able to choose the sovereigns w/ whom they interact and to whom they subject themselves; control jurisdictional destiny
     b.  comity:  “to ensure that the States through their courts do not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system”; DP clause as “instrument of interstate federalism.”
i.    But see Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee (1982), tb. 406 – footnote in maj. op. implied that the federalism rationale for limits on PJ is not independent of the protection of individual liberty rationale, since “if the federalism concept operated as an independent restriction on the sovereign power of the court, it would not be possible [for an individual] to waive the personal jurisdiction requirement:  Individual actions cannot change the powers of sovereignty, although the individual can subject himself to powers from which he may otherwise be protected.”
2.  What counts as a relevant “contact”?  See Hanson v. Denckla (1958) & WWV (1980)
a.  not mere connections/forseeability:  “The unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State.”
b.  but rather, personal availment: 
i.    N/Q of ∆’s activity must evince “some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.”  (Hansen)
(I)    “[T]he foreseeability that is critical to due process analysis is not the mere likelihood that a product will find its way into the forum State.  Rather, it is that the defendant’s conduct and connection with the forum are such the he should reasonably anticipate being haled into court there.”  (WWV)
(II)   “Jurisdiction is proper . . . where the contacts proximately result from actions by the defendant himself that create a ‘substantial connection’ with the forum State.  Thus where the defendant ‘deliberately’ has engaged in significant activities within a State . . . or has created ‘continuing obligations’ between himself and resident of the forum, . . . he manifestly has availed himself of the privilege of conducting business there, and because his activities are shielded by the ‘benefits and protections’ of the forum’s laws it is presumptively not unreasonable to require him to submit to the burdens of litigation in that forum as well.”  (BK)
ii.   Examples:
(I)    Hansen v. Denckla (1958) – MC threshold not met for FL court to exercise PJ over nonresident (DE) bank, where the defendant trustee’s only connection with FL consisted of correspondence with the trustor, after the trustor moved there from PA, the state where the trustor was domiciled at the time she executed the trust agreement w/ ∆.  (“unilateral activity” of 3P does not constitute “contact”)        
(II)   Kulko (1978) – a father’s purchase of an airline ticket in NY for his daughter to fly to California to meet her mother does not constitute personal availment sufficient to for CA court to exercise PJ in divorce suit because the father (∆) did not purposefully avail himself of the “benefits and protections” of CA’s laws . . .   
(III) World-Wide Volkswagen Corp. v. Woodson (1980) – MC threshold not met for OK court to exercise PJ “over a nonresident automobile retailer and its wholesale distributor in a products liability action, [where] the defendants’ only connection with Oklahoma is the fact that an automobile sold in New York to New York residents [who] became involved in an accident in Oklahoma.”   ∆s only “purposefully availed” themselves of NY, NJ, & CT markets . . .
(IV)  Burger King Corp. v. Rudzewicz (1985) – MC threshold met where:
        (A)  dispute grew out of K “which had substantial connection w/ the forum State”
(B)  ∆ “deliberately ‘reached out beyond’ Michigan and negotiated with a Florida corporation for the purchase of a long-term franchise and the benefits that would derive from affiliation with a nationwide organization.”
(C)  ∆ “entered in to carefully structured 20-year relationship that envisioned continuing and wide-reaching contacts w/ BK in FL”
(D)  ∆ voluntarily accepted the long-term and exacting regulation of his business from Burger King’s Miami headquarters
(E)  Moreover, the substance of the K itself gave fair notice of amenity to suit in FL:
        (1)  emphasizes supervision from and payments to Miami hqs
        (2)  recites that the agreement itself was made, and will be enforced, in FL
(F)  And the parties’ course of dealing reflected the understanding that ultimate authority for decisions rested with management at hqs in FL
(G)  Last but not least, the COL clause providing for dispute-resolution under FL law, while far from dispositive for PJ purposes, “reinforced [∆’s] deliberate affiliation with the forum State and the reasonable foreseeability of possible litigation there . . .”  (SCRATCH THIS!!!  Gensler says not sound . . .)
Conclusion:  “Because Rudzewicz established a substantial and continuing relationship with Burger King’s Miami headquarter, received fair notice from the contract documents and the course of dealing that he might be subject to suit in Florida, and has failed to demonstrate how jurisdiction in the forum would otherwise be fundamentally unfair, we conclude that her District Cou

d to Houston once for K negotiations with Texas/Peruvian company
 (a)  counts as p/a > “reaching out” to forum by ∆
                             (b)  but one trip not s&c
                      (2)  company purchased helicopters from FW co. over 7-year period
     (a)  counts as p/a > “reaching out” to forum by ∆
     (b)  but per Rosenberg (1923), “mere purchases, even if occurring at regular intervals, are not enough to warrant a State’s assertion of in personam jurisdiction over a nonresident corporation in a cause of action no related to those purchases.”
                      (3)  company sent personnel to FW for training during same time per.
  (a)  counts as p/a > “reaching out” to forum by ∆
    (b)  but same Rosenberg analysis:  “The training was a part of the package of goods and services purchased by Helicol from Bell Helicopter.”
                     (4)  Texas/Peruvian co. with which Columbian co. (∆, Helicopteros) Kd to provide transportation services cut its checks to ∆ out of Houston back account
  (a)  does not count as p/a > unilateral activity of 3P > no “reaching out” to forum by ∆
                          (B)  contacts clearly sufficient if as much as in Perkins
                                 (1)  president/GM of Phillippine corp. maintained office in Ohio, in which he
                                       (a)  kept company files
                                       (b)  held director’s meetings
                                       (c)  carried on business correspondence
                                 (2)  distributed salary checks drawn on two active Ohio bank accts
                                 (3)  engaged an Ohio bank to acts as transfer agent
                     (4)  supervised policies dealing with the rehabilitation of the corporation’s Phillippine properties 
              (C)  What if the right kinds of contacts are more than Helicopteros but less than Perkins?
                     (1)  if contacts P, s&c, so PJ
                     (3)  if contacts > H, but < P, don’t know; have to argue both ways           iv.  If Π shows ∆ established MCs (intentional “reaching out” by ∆) w/ the forum, next question is:  Does the exercise of PJ on basis of those MCs comport with TNFPSJ? *Question:  Who bears burden here?  Is TNFPSJ presumed satisfied unless ∆ proves otherwise, or must Π affirmatively demonstrate that this prong is satisfied as well?                             (I)    Justice White’s original 5-factor test from WWV:                                     (A)  burden on ∆ (carries greatest weight)                                     (B)  forum State’s interest in adjudicating the dispute (C)  plaintiff’s interest in obtaining convenient and effective relief (“at least when that interest is not adequately protected by the plaintiff’s power to choose the forum”) (D)  judicial efficiency (“the interstate judicial system’s interest in obtaining the most efficient  resolution of controversies”)  DROP ON FINAL (E)  promotion of shared social policies (“the shared interest of the several States in furthering fundamental substantive social policies”)  DROP ON FINAL