2.4 Personal Jurisdiction

• Library: Federal Civil Practice in Virginia (Virginia CLE) (2023 Ed.)

2.4 PERSONAL JURISDICTION

2.401 Basic Rules and Provisions.

A. Essential Nature of Personal Jurisdiction.

"Personal jurisdiction is the power of a court 'to bring a person into its adjudicative process.'" ¹³⁰ The United States Supreme Court has stressed that proving the existence of personal jurisdiction is essential and that the personal jurisdiction inquiry could precede even a subject matter jurisdiction inquiry. ¹³¹

B. Due Process Requirements for Nonresidents.

The personal jurisdiction of state courts is limited by the due process requirements of the United States Constitution.

[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. ¹³²

To exercise personal jurisdiction over a nonresident defendant, "two conditions must be satisfied: (1) the exercise of jurisdiction must be authorized under the state's long-arm statute; and (2) the exercise of jurisdiction must comport with the due process requirements of the Fourteenth Amendment." ¹³³

C. Virginia Long-Arm Statute.

Virginia's long-arm statute, Va. Code § 8.01-328.1, has been held to extend personal jurisdiction to the outer limits of due process. ¹³⁴ The Supreme Court of Virginia has also stated that courts should construe the long-arm statute so as to extend the jurisdiction of Virginia courts "to the maximum extent permitted by the Due Process Clause of the Constitution." ¹³⁵

Va. Code § 8.01-328.1 confers specific jurisdiction over a nonresident defendant whose conduct gives rise to the plaintiff's cause of action. The statute requires "that there be a causal link between the alleged . . . activity relied upon to establish personal jurisdiction and the injury alleged in the cause of action. This causation element is more than a mere 'but, for' causation; this element requires causation that is more akin to proximate cause." ¹³⁶

Under Va. Code § 8.01-328.1(A)(1), a single act of "transacting business" in Virginia may be sufficient to confer in personam jurisdiction over a nonresident defendant. That single act, however, must be significant in order to confer jurisdiction. ¹³⁷

2.402 Distinction Between "General" and "Specific" in Personam Jurisdiction.

The test for determining whether a court has personal jurisdiction varies "depending on whether the defendant's contacts with the forum state also provide the basis for the suit," i.e., whether general or specific jurisdiction is asserted. ¹³⁸

There is a well-defined distinction between "general" and "specific" jurisdiction. ¹³⁹ In order for "general" jurisdiction to exist, a defendant must have "systematic and continuous" contacts with the forum state; for "specific" jurisdiction, the defendant's contacts with the forum state "must give rise to the liability sued on." ¹⁴⁰ Where "general" jurisdiction is absent, specific jurisdiction principles require each cause of action to arise from the defendant's contacts with the forum state. ¹⁴¹ This requires a cause of action by cause of action analysis. ¹⁴²

A. General Personal Jurisdiction.

If a defendant has "substantial . . . continuous and systematic" contacts with the forum state, then general personal jurisdiction over that defendant may exist even for a cause of action unrelated to those contacts. ¹⁴³

The Supreme Court has explained that general personal jurisdiction may only be found where a defendant's "affiliations with the State are so 'continuous and systematic' as to render [it] essentially at home in the forum State." ¹⁴⁴

Merely putting a product into the "stream of commerce" is insufficient to establish general jurisdiction. ¹⁴⁵

Likewise, the mere appointment of an agent for service of process is not enough to establish general personal jurisdiction. ¹⁴⁶

B. Specific Personal Jurisdiction.

If a nonresident defendant's contacts with the forum state are not substantial enough to establish general personal jurisdiction, the defendant may still be subject to a court's specific personal jurisdiction for claims related to its activities within the forum state.

To establish specific personal jurisdiction, the plaintiff must show that the nonresident "defendant has 'purposefully directed' his or her activities at residents of the forum . . . and the litigation results from alleged injuries that 'arise out of or relate to' those activities." ¹⁴⁷

The current leading case from the Supreme Court dealing with specific jurisdiction is Walden v. Fiore. ¹⁴⁸ In this case, the Court addressed the "minimum contacts" necessary to create specific jurisdiction. The Court emphasized that the suit-related conduct must create a substantial connection with the defendant and the forum state, but the relationship must arise out of contacts between the defendant himself or herself and the forum state. ¹⁴⁹ The defendant's contacts must be with the forum state itself, and not merely with persons who reside there. In addition, the plaintiff cannot be the only link between the defendant and the forum. "Rather, it is the defendant's conduct that must form the necessary connection with the forum State that is the basis for its jurisdiction over him." ¹⁵⁰

Where a plaintiff failed to make a prima facie showing of personal jurisdiction over a parent company based on the Virginia contacts of its subsidiary, jurisdiction was found lacking and a motion to dismiss was granted. ¹⁵¹

For a 2016 opinion detailing the three-part test for specific jurisdiction over a nonresident defendant, see Turner v. Syfan Logistics, Inc. ¹⁵²

2.403 Minimum Contacts to Satisfy Due Process.

The due process inquiry examines whether a defendant has established sufficient "minimum contacts" with the forum state, and has purposefully "availed himself of the privilege of conducting business there," such that he or she had "fair warning that a particular activity may subject [him] to the jurisdiction of a foreign sovereign." ¹⁵³ "[I]t is essential in each case that there be 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." ¹⁵⁴ These activities need not involve physical presence in the state but must still be "purposefully directed toward the forum state." ¹⁵⁵

The Fourth Circuit has summarized the three-part due process inquiry as follows: "(1) the extent to which the defendant purposefully availed itself of the privilege of conducting activities in the State; (2) whether the plaintiff['s] claims arise out of those activities directed at the State; and (3) whether the exercise of personal jurisdiction would be constitutionally reasonable." ¹⁵⁶

For a 2015 case that has applied a sophisticated analysis of all of the "minimum contacts" factors, finding some to be satisfied and others not, see Independent Printers Worldwide, Inc. v. Cole. ¹⁵⁷

· In-Forum Effects of Out-of-Forum Conduct. While in-forum effects of out-of-forum conduct can suffice as minimum contacts, the Fourth Circuit recently emphasized the "important limitations to this principle":

· These in-forum effects must create a connection to the forum itself, not just to parties who happen to reside there;

· Such connection must be "substantial"; and

· The forum must be the "focal point" of the conduct. That is, the defendant must have "expressly aimed" its conduct at the forum. ¹⁵⁸

A nonresident business, not otherwise having traditional minimum contacts with a forum state, does not become subject to personal jurisdiction merely because the effect of an intentional tort is somehow felt in the forum. The tortious conduct of the business must be "intentionally targeted at and focused on" the forum state. ¹⁵⁹

· "Stream of Commerce" Theory. The United States District Court for the Western District of Virginia has comprehensively addressed the "stream of commerce" theory recognized in World-Wide Volkswagen Corp. v. Woodson, ¹⁶⁰ to find that a Connecticut company, with no offices in Virginia, no employees in Virginia, and no property or bank accounts in Virginia, was, nonetheless, subject to jurisdiction in Virginia for having placed oysters harvested in Connecticut into the "stream of commerce" and when it made significant sales (although not to the entity that sold the bad oysters to the plaintiff) to entities in Virginia and derived substantial revenues from those sales. Under these circumstances, where the company undertook extensive indemnification obligations to purchasers who sold defective products to their customers, it was found to be "foreseeable" to the defendant that it might have to defend suit in Virginia. ¹⁶¹

More recently, the United States District Court for the Eastern District of Virginia found that the foreign manufacturers of a product sold and marketed to major retailers with a presence in every State, including Virginia, were subject to personal jurisdiction in Virginia under a "stream of commerce" theory. ¹⁶² The court adopted a "national contacts" or "national markets" test "under which a foreign defendant who places its products into the stream of commerce with the intent to serve the United States as a whole will be subject to personal jurisdiction in any individual State." ¹⁶³

· Solicitation of Business. The solicitation of business through a nationally circulated publication is not, by itself, sufficient to confer jurisdiction over a nonresident defendant, as the Court held in Cancun Adventure Tours , Inc. v. Underwater Designer Co. ¹⁶⁴ Nevertheless, the Court also held that the exercise of long-arm jurisdiction was proper because the defendant had, in addition to distributing its magazine in Virginia, engaged in business dealings with a Virginia consumer, including mailing of price quotations to a buyer in Virginia and accepting payment

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