2.4 Personal Jurisdiction

• Library: Federal Civil Practice in Virginia (Virginia CLE) (2018 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.'" ¹²⁰ 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. ¹²¹

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. ¹²²

2.402 Distinction Between "General" and "Specific" in Personam Jurisdiction. There is a well-defined distinction between "general"

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and "specific" jurisdiction. ¹²³ In order for "general" jurisdiction to exist, a defendant must have "systematic and continuous" contacts with the forum state, while, for "specific" jurisdiction, the defendant's contacts with the forum State "must give rise to the liability sued on." ¹²⁴ Where "general" jurisdiction is absent, specific jurisdiction principles require each cause of action to arise from the defendant's contacts with the forum State. ¹²⁵ This requires a cause of action by cause of action analysis. ¹²⁶

The United States District Court for the Western District of Virginia recently issued a comprehensive decision reviewing the principles of general jurisdiction and specific jurisdiction, and underlining the differences between these two concepts. ¹²⁷

2.403 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. ¹²⁸

In recent years, 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." ¹²⁹

Merely putting a product into the "stream of commerce" is insufficient to establish general jurisdiction. ¹³⁰

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Likewise, the mere appointment of an agent for service of process is not enough to establish general personal jurisdiction. ¹³¹

2.404 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." ¹³²

The current leading case from the Supreme Court dealing with specific jurisdiction is Walden v. Fiore. ¹³³ 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 between the defendant and the forum state, but the relationship must arise out of contacts between the defendant himself or herself and the forum state. ¹³⁴ 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." ¹³⁵

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. ¹³⁶

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"Stream of commerce" specific personal jurisdiction was found for an oyster harvester. ¹³⁷

For a recent opinion detailing the three-part test for specific jurisdiction over a nonresident defendant, see Turner v. Syfan Logistics, Inc. ¹³⁸

2.405 Virginia Long-Arm Statute. For a district court to exercise personal jurisdiction over a nonresident defendant, two conditions must be satisfied: (i) the exercise of jurisdiction must be authorized by the long-arm statute of the forum state, and (ii) the exercise of jurisdiction must comport with the Fourteenth Amendment's due process requirements. ¹³⁹

Virginia's long-arm statute has been held to extend personal jurisdiction to the outer limits of due process. ¹⁴⁰ 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." ¹⁴¹

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." ¹⁴²

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

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nonresident defendant. That single act, however, must be significant in order to confer jurisdiction. ¹⁴³

One case from the Eastern District of Virginia notes that, although Virginia's long-arm statute extends in personam jurisdiction "to the fullest extent permitted by due process . . . ," it may, nevertheless, be possible for the contacts of a nonresident defendant "to satisfy due process, but not meet the specific grasp of Virginia's more specific long-arm statute provisions." ¹⁴⁴

2.406 Service of Process on Foreign Entities. Service of process on a foreign entity is governed by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters (the "Hague Convention"). ¹⁴⁵ The Hague Convention is a multilateral treaty enacted for the purpose of creating a simple procedure for effecting service of process on foreign litigants. ¹⁴⁶ Most countries, including the United States, are parties to this Convention. ¹⁴⁷

Chapter 1 of the Hague Convention authorizes several different methods of service abroad. The basic method is found in articles 2 through 7 of that chapter. These articles provide that "each signatory country shall designate a 'Central Authority' (usually that country's department of justice) to receive judicial documents from abroad" and to "serve[] the process or other documents on parties within the country according to that country's internal law." ¹⁴⁸

Use of the "Central Authority" is not, however, the only means of effecting service under the Hague Convention. Articles 8 and 9 authorize service upon a foreign entity directly through a member nation's consular

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personnel or diplomatic agents. ¹⁴⁹ Article 10 authorizes service by mail. ¹⁵⁰ Any of these methods is available, in addition to the "Central Authority," unless the member nation has specifically objected to their use. ¹⁵¹

2.407 Burden of Proof for Fed. R. Civ. P. 12(b)(2) Motions. The plaintiff carries the ultimate burden of proving the existence of a valid ground for the court to exercise jurisdiction by a preponderance of the evidence. ¹⁵² The plaintiff must make a prima facie case for jurisdiction on the basis of its complaint and affidavits, which are viewed in the light most favorable to the plaintiff. ¹⁵³ The court determines, first, if a prima facie case for jurisdiction exists based on the long-arm statute, then whether the exercise of personal jurisdiction would be consistent with the requirements of the Due Process Clause. ¹⁵⁴

A. Hearing on Evidence Outside the Pleadings. "If the existence of jurisdiction depends on the resolution of disputed factual issues, the Court may resolve the issues at a separate evidentiary hearing, or may defer ruling pending the receipt of evidence at trial." ¹⁵⁵

The Fourth Circuit has considered whether an evidentiary hearing, involving taking live testimony from witnesses, is always required to resolve a contested Fed. R. Civ. P. 12(b)(2) motion. ¹⁵⁶ The court found that where the parties had "engaged in full discovery on the jurisdictional issue and fully presented the relevant evidence to the District Court," a formal evidentiary hearing was not required by Fed. R. Civ. P. 12(b)(2), especially where neither side actually requested such a hearing after filing their supporting papers. ¹⁵⁷ Even though a court is required to take the allegations and available evidence relating to personal jurisdiction in the light most favorable

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to the plaintiff, ultimately, it is the plaintiff's responsibility to establish facts supporting jurisdiction over the defendants "by a preponderance of the evidence." ¹⁵⁸ The term "evidentiary hearing" requires only that the "District Court afford the parties a fair opportunity to present both the relevant jurisdictional evidence and their legal arguments. Once the court has provided that opportunity, it must hold the plaintiff to its burden of proving facts, by a preponderance of the evidence, that demonstrate the court's personal jurisdiction over the defendant." ¹⁵⁹ The court has broad discretion to determine the procedure to be followed, and it may, but is not required to, conduct a hearing and receive live testimony...