Civil Procedure Class Notes 9/22/03


We left off with Burnham.


If there’s no majority opinion in Burnham, how does it help us understand jurisdiction?  There is lots of stuff that we can take from Burnham and apply to jurisdictional analysis.


The court is unanimous in the judgment.  In-state service on a defendant will be sufficient to get jurisdiction.  But what’s the reasoning?


The Scalia four say the rationale is tradition.  We’re always done this, thus we must continue to do so.


The Brennan four say minimum contacts analysis gets us to the same place.


Justice Stevens says, “Whateva.  I do what I want!  I do what I want!”


Grace v. MacArthur


This is the ultimate in gotcha jurisdiction.  Someone is served on a plane over Arkansas.  Is there jurisdiction?


It makes a difference which route you take, Scalia’s or Brennan’s.


What if someone is brought to another state fraudulently?  The Second Circuit and the Eastern District of Michigan have held that if you’re induced to a jurisdiction by fraud, the forum doesn’t have personal jurisdiction over you.


Carnival Cruise Lines, Inc. v. Shute


Let’s say we include a clause in a contract that says you appoint someone to accept service of process.  This is a “consent to jurisdiction clause”.  This was discussed in Shoe.


What about a clause that says “all litigation arising from this argument will be governed by the law of such and such a forum”?  That’s a choice of law clause, like the one in Burger King.


There’s also “cognovit” which is apparently constitutionally permissible, and is a way of agreeing to confess judgment, thus shifting the burden from the plaintiff to you.


What if there’s a clause that says “all litigation will take place in such and such a forum”?  That’s a forum selection clause, and that’s what we have in Carnival.


What’s happening in Carnival?  What are the facts?  The Shutes bought cruise tickets from an agent in Washington.  That’s where they’re from.  They’re cruising from Los Angeles to Mexico.  Carnival is in Florida (for purposes of jurisdiction).


What happened on the cruise?  The wife slipped on the boat!  The boat is in international waters when it happens.

The Shutes sue Carnival in Federal District Court in Washington.  But “not so fast, my friend”!  The tickets have a forum selection clause on them that says all litigation has to be done in Florida.


Say there’s no forum selection clause.  Say we’re going to analyze the situation based on the principles of personal jurisdiction we’ve covered up to this point.  What happens?


We could get general jurisdiction in Washington if Carnival has continuous and systematic contacts with Washington (we find this out from Helicopteros).  This would probably fail.  There would be general jurisdiction in Florida.


Could we get specific jurisdiction over Carnival in Washington?  First, we have to have minimum contacts, and then we need fair play.  Is this a stream of commerce issue?  No, because this is a business that provides a service rather than a manufactured product.


What about purposeful availment?  Yes, Carnival advertises in Washington.  This would constitute a contact.  Are there any other contacts related to this claim?  They trained the travel agents and took money from the agents and supplied them with tickets.


We have contacts!  Now, we proceed to fair play, where we ask the five questions.


1.     The burden on the defendant

2.     The interest of the forum state

3.     The plaintiff’s interest in a convenient forum

4.     Interstate efficiency

5.     Interstate policy


The state has an interest in protecting its citizens.


It’s as efficient to have the trial in Washington as anywhere else.


In summary, we get fair play, and there would be jurisdiction in Washington.  However, the Supreme Court says Washington does not have jurisdiction due to the tiny little forum selection clause.


The Shutes conceded that they had notice of the forum selection clause.  If the Shutes had argued that they had no idea what the contract said, they might have had a case based on the question of notice.


Stevens is critical of the fact that the Court doesn’t consider the notice issue.  He says the contract may be a “contract of adhesion”, or a “take it or leave it” contract.


Why does the majority decide that forum selection clauses are okay in this context?  They give three reasons, all in one category: policy, or making it work right from a systemic standpoint.


What are the cruise line’s interests in the enforcement of the clause?


1.     The cruise line carries passengers from everywhere, but they don’t want to be subject to suit everywhere.  But why will we allow them to limit where they’re liable?  We’re okay with allowing people to be liable if their goods go into the stream of commerce pretty much everywhere.

2.     Also, the judicial system has an interest in settling the jurisdiction question ahead of time.  In other words, it is efficient to have forum selection clauses.

3.     Passengers benefit from lower costs.  Fairman suggests that the Shutes probably weren’t sophisticated enough to make an informed economic calculation about the costs and risks of choosing a cruise line that would subject them to suit in a foreign forum.


The ultimate question is one of “fundamental fairness”.  We won’t allow the cruise line to select a forum with the purpose of discouraging legitimate lawsuits.


What if it was conceded that the plaintiffs did not have notice?  Is that part of fundamental fairness?  Sure.


Interesting procedural points in Carnival


We started out in Federal District Court in Washington, which found that there was jurisdiction and did not enforce the forum selection clause.  The Ninth Circuit originally reversed, but on rehearing, asked the Washington Supreme Court a question.  Here, there’s an unanswered question of state law, and the Circuit Court wanted to pose a certified question to the Washington Supreme Court who, as experts in their own state law, know what should be done.  The Washington Supreme Court says it’s okay and affirm, but then it goes to the United States Supreme Court and gets ultimately reversed.


Which of the cases that we’ve talked about already could have been settled with a forum selection clause?  How about in Asahi?  Could they have included a forum selection clause in their contract that they would settle their disputes in Taiwan or Japan?  Yeah, this would be an easy one if one of the companies had put a forum selection clause in there!  You could file a motion to dismiss based on the forum selection clause, and that’s that.


Basically, forum selection clauses are good law.”


Tomorrow, we’ll finish this up and then go on to Mullane, where notice is not assumed.


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