Missed Connections: SCOTUS and 7th Circuit Analyze Specific Jurisdiction in Cases where Minimum Contacts Fall Short

27 February 2014 Wisconsin Appellate Law Blog

A pair of recent decisions explain what a defendant must have done in a forum state to be properly haled into court there. 

In Walden v. Fiore, 571 U.S. ___, decided on Tuesday, the U.S. Supreme Court unanimously reaffirmed the proper focus in determining whether “minimum contacts” exist for specific jurisdiction over a defendant. The Court underlined that the suit-related relationship “must arise out of contacts that the ‘defendant himself’ creates with the forum State.” They cannot arise merely from contacts a plaintiff has with the forum state, nor from contacts the defendant has with a plaintiff residing in the forum state if those contacts themselves are unconnected with that state.

The case arose when a federal agent in Georgia seized cash from plaintiffs, who resided in Nevada, while they were at an Atlanta airport, and thereafter held it temporarily. The plaintiffs brought a Bivens action against the agent in Nevada for violating their Fourth Amendment rights. The defendant agent’s actions all occurred in Georgia; he “never traveled to, conducted activities within, contacted anyone in, or sent anything or anyone to Nevada.” The district court dismissed the suit, but the Ninth Circuit reversed, finding that the agent “expressly aimed” an allegedly false probable cause affidavit at Nevada, because he knew it would affect persons with significant connections to that state.

The Supreme Court reversed, focusing on the lack of contacts of the defendant with Nevada. Indeed, the case seems easy once the relevant contacts are so framed. The Ninth Circuit had relied on the analysis of tortious conduct’s “effects” in Calder v. Jones, 465 U.S. 783 (1984), a libel case. So the Supreme Court clarified the reach of Calder, explaining that the required connection between the defendant and the forum there had been “largely a function of the nature of the libel tort,” as well as the forum’s connections to the story and its readership. “Calder made clear that mere injury to a forum resident is not a sufficient connection to the forum.” Rather, a defendant must have created contacts with the forum state itself. In Walden, there was no such basis for jurisdiction.

Practitioners in the Seventh Circuit should take note of that court’s opinion last week in Northern Grain Marketing, LLC v. Greving, 12-2653. The court held that an Illinois federal court could not exercise jurisdiction over a Wisconsin farmer who had run into a representative of Northern Grain (an Illinois-based company) at an Illinois trade show and later entered into a number of contracts with the company for discrete deliveries of grain. The contracts were wholly performed in Wisconsin, with Greving producing the grain in Wisconsin, delivering it to a Wisconsin grain elevator, and meeting with company representatives only in Wisconsin. In the face of so little contact with the forum state, the Seventh Circuit found no basis to exercise specific jurisdiction over the farmer in Illinois.

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