Civil Procedure Class Notes 9/30/03


Venue: what is it?


Venue specifies a specific court within a jurisdiction where parties can litigate.  For example, let’s say you know you have jurisdiction in Texas, but there are four federal district courts there.  Venue tells you where exactly you’re going to do your trial.


We will look at the federal venue statute, 28 U.S.C. § 1391, as a model for all venue statutes.


The structure of the statute


Part (a) deals with diversity-only claims.  Part (b) deals with not-diversity, or “federal question”-type cases.  Part (c) is a special provision for corporate defendants.  Part (d) is all about aliens.  Parts (e) and (f) are all about governments.


Problems on Venue


The defendant is in the Southern District of New York.  The product was designed in Arizona, built in Illinois, and there were parts from all over the place.  Venue will be proper in the Southern District of New York for sure.  We might want to forum-shop, though, and we might want to get venue somewhere else.


Depending on the operative issue, we might be able to get venue in Illinois or Arizona, for example, if a substantial part of the events happened in one of those states.


There is a rule that is not in the statute: “Venue for one is venue for all.”  The exception is in the case that follows, where even though the venue is appropriate for the foreign defendants, it may not be appropriate for the domestic defendants.


Say the plaintiff sues one defendant in the Southern District of New York, and another who lives in New Jersey but works in New York.  The contract would have been performed overseas.  If we sue them for breach of contract, there won’t be a federal statute.  Thus, it’s likely that the only way to sue in federal court is because of the diversity of the defendants.  Since the defendants don’t all live in the same state, we can’t use § 1391(a)(1).  In fact, we have to skip § 1391(a)(2) because a substantial part of the events took place overseas.  § 1391(a)(3) says that we can then sue the defendants in any forum where they are subject to personal jurisdiction.


In regard to corporations, § 1391(c) says that venue basically collapses into personal jurisdiction.


How about a Canadian suing a Californian over a car accident in Arizona?  We look at § 1391(a) because a foreign plaintiff will make for diversity jurisdiction.  The plaintiff can sue in the Eastern District of California or in Nevada.


How about the Californian suing the Canadian?  An alien can be sued in any district under § 1391(d).  So okay, yay!  Is this unfair?  Why won’t we try to be fair to foreigners?  Isn’t this rule incompatible with our principles of personal jurisdiction?  Where is the convenience test here?


The answer is: just because the alien defendant can be sued in any district doesn’t mean there will be personal jurisdiction over them in any district.  This is analogous to the provision that collapses venue and personal jurisdiction for corporations.


Dee-K Enterprises, Inc. v. Heveafil Sdn. Bhd.


What is this case about?  It’s about bungee cord!  There is an allegation of an international cartel jacking up the price of bungee cord thread.  Yeazell leaves out a critical part of the case, according to Fairman.


Two American companies sue some Malaysian, Indonesian, and Thai corporations as well as their American distributors.  The distributors are wholly-owned subsidiaries of the foreign corporations.  There are lots and lots of people involved here.


There are challenges to both jurisdiction and venue.  Yeazell omits the jurisdictional argument, but we’ll consider it.


Jurisdiction in Dee-K


In a diversity action, we would use state law.  However, in this international anti-trust case, they look to the federal statute, which is the Clayton Act.


We can also look at FRCP Rule 4(k)(2), which has a provision for defendants without contacts with any one state sufficient to constitute jurisdiction.


How was Bakrie served?  Did it get proper notice?  Because Indonesia is not party to the Hague Convention, serving it by certified mail is okay, and that’s what they did.


So Bakrie’s service satisfied the “long-arm” statutes, such as they are.  What about Due Process?  Could we get general jurisdiction?  We rarely can, and definitely cannot in this case.  It will be specific jurisdiction.  We must do a contacts analysis.


What test do we use for minimum contacts given that Bakrie is a manufacturer that makes goods for the United States?  Do we use stream of commerce or stream of commerce plus?  It turns out that the Fourth Circuit has adopted the stream of commerce plus standard.  We need “other things”.  The other things we find are that Bakrie designed products for the United States and marketed their product through sales agents in the United States.


Venue in Dee-K


Where will we have venue over the foreign defendants?  The Clayton Act said something, but so did § 1391.  It turns out that the Supreme Court has ruled that § 1391 trumps the Clayton Act.  § 1391(d) gives you venue over aliens anywhere you’d like.  Venue is easy for the aliens.

What about for the U.S. defendants?  The claim is characterized as a federal question because the suit is under federal law.  Venue is therefore determined under § 1391(b).  § 1391(b)(1) doesn’t apply because the defendants aren’t all from the same state.  § 1391(b)(2)  doesn’t apply because presumably the alleged conspiracy occurred overseas.  Therefore, § 1391(b)(3) must apply, and it says that venue may lie in any judicial district where any defendant may be found.


The court says that Congress must not have intended the foreign defendants to “pull” the domestic defendants into a particular venue.  Therefore, the court “punts” the case back down to a lower court to get more information.


Even though there is a broad provision about aliens in the FRCP, courts make you work through the domestic defendant analysis first, and you can’t use § 1391(d) as a trump card.


Tomorrow, we will conclude venue and move on to forum non conveniens.


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