Personal Jurisdiction, Process, and Venue in Antitrust and Business Tort Litigation

• Pages: 261-295

CHAPTER X

PERSONAL JURISDICTION, PROCESS,

AND VENUE IN ANTITRUST

AND BUSINESS TORT LITIGATION

Like subject matter jurisdiction, personal jurisdiction

often is an issue at the inception of antitrust and business tort

litigation – which now includes Internet cases. So, too, are the

issues of process and venue. Some federal statutes – such as

the antitrust and securities laws – provide for nationwide

service of process; in cases involving parties from different

states, the ability to effect extraterritorial service may weigh in

favor of asserting such federal claims. In contrast, venue

choices in state court often are as rich or richer than those

available in the federal courts. This chapter surveys how

personal jurisdiction, process, and venue may vary in antitrust

and business tort litigation; how these and other factors impact

on choice of forum is addressed in Chapter 11. – Eds.

A. Introduction

Assuming a court has subject matter jurisdiction, its power over a

defendant is a function of three related concepts: personal jurisdiction,

service of process, and venue. The rules governing these concepts may

vary depending upon the forum chosen and the substantive claims

asserted.

In particular, the assertion of federal antitrust or other statutory

claims may significantly impact the plaintiff’s venue choices, as well as

the defendant’s transfer opportunities. This chapter addresses the

interplay of the constitutional and procedural rules determining a court’s

ability to assert and retain personal jurisdiction in antitrust and business

tort litigation.

B. Personal Jurisdiction and Service of Process

1. General Federal Due Process Constraints

The requirement that a court have personal jurisdiction over the

defendant in a federal question case stems from the Due Process Clause

262 Business Tort Law

of the Fifth Amendment.1 The test for personal jurisdiction requires that

the defendant have “minimum contacts” with the forum and that

maintenance of the suit “not offend ‘traditional notions of fair play and

substantial justice.’”2

When a federal court adjudicates state-created rights under diversity

jurisdiction, the constitutional inquiry is guided by the same Fourteenth

Amendment standards applicable to state long-arm jurisdiction. The

critical question is whether the defendant has sufficient minimum

contacts with the forum state to permit the exercise of jurisdiction over

it.3 A plaintiff may seek to establish “general jurisdiction” over a

defendant by showing that the defendant maintained “continuous and

systematic” contacts with the forum state.4 Or a plaintiff may seek to

establish “specific jurisdiction” by showing that the defendant purposely

directed his activities at residents of the forum and that the plaintiff’s

claims arise out of or relate to those activities.5

In federal question cases, there has been disagreement over whether

the federal courts are constrained by Fourteenth Amendment standards or

by the broader standards emanating from the Fifth Amendment, which

focus on the defendant’s aggregate contacts with the United States.6

1. Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694,

702 (1982).

2. Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945); see Asahi Metal

Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 105, 108-09 (1987).

3. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985).

4. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414

n.9 (1984). Additionally, the Supreme Court has held that transient

jurisdiction, acquired by personally serving a nonresident defendant while

physically present in the forum state, is a constitutionally valid method of

asserting general jurisdiction. Burnham v. Superior Court of Cal., 495

U.S. 604, 628 (1990) (the Due Process Clause of the Fourteenth

Amendment does not prohibit California courts from exercising

jurisdiction over nonresident based on fact of in-state service of process).

5. See Burger King Corp., 471 U.S. at 472-73; Hall, 466 U.S. at 414 n.8.

6. See, e.g., Cargill Inc. v. M/V Paschalis, No. 86 Civ. 0805, 1997 WL

17950, at *1-2 (S.D.N.Y. Sept. 30, 1987) (noting disagreement over use of

nationwide contacts in consideration of personal jurisdiction); Superior

Coal Co. v. Ruhrkohle, A.G., 83 F.R.D. 414, 418 (E.D. Pa. 1979)

(although Fifth Amendment Due Process Clause permits aggregation of

defendant’s contacts across the nation, no federal statute authorizes district

Personal Jurisdiction 263

Strict application of the minimum contacts doctrine in the federal courts

cannot always be reconciled with various federal statutes authorizing

nationwide service of process, such as Section 12 of the Clayton Act.7

The Supreme Court has not considered the constitutionality of this

national or aggregate contacts theory,8 and federal circuit courts are split

over whether only a national contacts analysis is required when process

is served under a federal statute’s nationwide service of process

provision.9

Until 1993, in the absence of a federal statutory provision for

service, a federal court’s jurisdiction in federal question cases could be

limited by the forum state’s long-arm statute, not because of the Due

courts to take nationwide contacts into consideration; no personal

jurisdiction where defendant lacked adequate minimum contacts with

forum state); see also Herbert Hovenkamp, Personal Jurisdiction and

Venue in Private Antitrust Actions in Federal Court: A Policy Analysis, 67

IOWA L. REV. 485, 500-01 (1982); see generally 4 CHARLES ALAN

WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE

§ 1067.1 (3d ed. 2002) (discussing development of minimum contacts

doctrine).

7. 15 U.S.C. § 22; see also 15 U.S.C. § 77(v) (the Securities Act), 15 U.S.C.

§ 78aa (the Securities Exchange Act), 15 U.S.C. § 49 (the Federal Trade

Commission Act); 18 U.S.C. § 1965 (the Racketeer Influenced and

Corrupt Organizations Act).

8. Omni Capital Int’l, Ltd. v. Randolph Wolff & Co., 484 U.S. 97, 102 n.5

(1987) (citing Asahi Metal Indus. Co., 480 U.S. at 113 n.*).

9. Compare Autoscribe Corp. v. Goldman & Steinberg, No. 94-1749, 1995

U.S. App. LEXIS 2848, at *7 (4th Cir. Feb. 3, 1995), Busch v. Buchman,

Buchman & O’Brien Law Firm, 11 F.3d 1255, 1258 (5th Cir. 1994),

United Liberty Life Ins. Co. v. Ryan, 985 F.2d 1320, 1330 (6th Cir. 1993),

United Elec., Radio & Mach. Workers v. 163 Pleasant St. Corp., 960 F.2d

1080, 1085 (1st Cir. 1992), Go-Video, Inc. v. Akai Elec. Co., 885 F.2d

1406, 1414-16 (9th Cir. 1989), Lisak v. Mercantile Bancorp, Inc., 834 F.2d

668, 671-72 (7th Cir. 1987), Hogue v. Milodon Eng’g, Inc., 736 F.2d 989,

991 (4th Cir. 1984), FTC v. Jim Walter Corp., 651 F.2d 251, 256 (5th Cir.

1981), and Tex. Trading & Milling Corp. v. Fed. Republic of Nigeria, 647

F.2d 300, 314-15 (2d Cir. 1981), with In re Vitamins Antitrust Litig., 94 F.

Supp. 2d 26, 38-39 (D.D.C. 2000), and GTE New Media Servs. Inc. v.

BellSouth Corp., 199 F.3d 1343, 1350 (D.C. Cir. 2000) (citing Goldlawr,

Inc. v. Heiman, 288 F.2d 579, 581 (2d Cir. 1961), rev’d on other grounds,

369 U.S. 463 (1962)); see discussion infra Parts E.1, E.2.