Sample Answer: # 8(B): (Support of Motion)
The court should grant the 12(b)(2) Motion to Dismiss for Lack of Personal Jurisdiction.
A federal district court exercises personal jurisdiction over a defendant who is subject to the jurisdiction of a state court in which the district court sits. FRCP 4(k)(1)(A). This directs the court to the state’s long-arm statute. California courts exercise personal jurisdiction on any basis not inconsistent with the Constitution of the United States or of California. Cal. Code Civ. P. 410.10. This collapses the statutory analysis into the constitutional analysis—the statute is satisfied if the exercise of jurisdiction is constitutional.
A court exercises specific jurisdiction when the defendant’s contacts with the forum give rise or relate to the claim; it exercises general jurisdiction when a defendant is subject to suit in a forum on all claims, regardless of connection between in-state activities and the claim. Daimler. Courts exercise general jurisdiction where a defendant is “essentially at home” in the forum—a corporation’s principal place of business and state of incorporation and an unincorporated association’s principal place of business. Daimler. Neither defendant is essentially at home in California—Lufthansa is a German corporation with its principal place of business in Germany; LGBS is an LLC with its principal place of business in New York.
Courts exercise specific jurisdiction over an out-of-state defendant where the defendant has certain minimum contacts with the forum, those contacts give rise or relate to the claim, and maintenance of the suit does not offend traditional notions of fair play and substantial justice. Ford; Shoe. This test contains three parts: 1) Minimum contacts; 2) relationship ; and 3) traditional notions. If the plaintiff does not have minimum contacts, the court lacks jurisdiction; it need not consider the other elements. World Wide.
Minimum Contacts
A defendant must, through her conduct, purposefully avails itself of the privileges of conducting activities in the state and receiving benefits and protections of the laws of the forum state, such that the defendant can reasonably anticipate being haled into court in that state. Nicastro; World Wide. Courts look for a relationship among the defendant, the forum, and the litigation. Walden. The defendant’s contacts with the state must be intentional, not random or fortuitous, World Wide, and they must be the result of its conduct, not the conduct of the plaintiff or a third party. Walden.
Plaintiffs bring two claims: Breach of Contract and Disclosure of Private Facts.
A party purposefully avails by entering into a contract with a substantial connection and continuing obligations to the forum. Burger King. This considers every step in the contract—negotiation, execution, performance, and breach. Id. Defendants contracted with plaintiffs to transport them to California and breached that contract by disclosing their private information during the performance of that contract. The conduct that constitutes the breach—the disclosure of the information—did not occur in California. A Lufthansa employee disclosed the information at the airport in Saudi Arabia and transmitted it from there to Germany; Lufthansa then failed, from its offices in Germany, to protect that information.
Courts apply the “Effects Test” in cases of tort-out-injury-in—the tortious act occurs outside the forum state but the injury occurs in the forum. A defendant must intentionally and purposefully direct its conduct at the forum state and the brunt of the harm must be felt there. Walden; Calder. Defendants’ tortious actions occurred in Saudi Arabia (from which Defendants sent plaintiff’s private information was sent) and Germany (where Defendants failed to protect the information). That Lufthansa knew plaintiffs were traveling to California does not constitute direction of activity to that state; plaintiffs would have felt the effects of the disclosure regardless of where they traveled. Plaintiffs stand as the plaintiffs in Walden—they would have felt the loss of their money (at the Georgia airport) anywhere they went. Walden.
Finally, a defendant purposefully avails by serving or seeking to serve the forum through sales, service, having sales people and employees, maintaining offices, and conducting other business activity in the forum. Lufthansa serves California. It operates regular flights into and out of California, maintains airport offices and employees at airports in Los Angeles and San Francisco, and has an agent for service of process.
Contacts Give Rise or Relate to the Claim
Contacts give rise to a claim (or the claim arises from the contacts) when there is a causal relationship between the contacts and the claim—the contacts constitute the proximate cause of the claim or are part of the transaction giving rise to the claim. Ford. Contacts relate to the claim where there is a more attenuated relationship lacking that causal connection. Ford. This may include a longer, but-for chain between the contacts and the events giving rise to the action.
None of the conduct giving rise to the claims occurred in California. The disclosure and failure to protect plaintiffs’ information—the tortious and breaching acts sued upon—occurred outside California. Similarly, Lufthansa’s business in California—operating flights to airports in the state—did not cause these improper disclosures.
While “relate to” allows a broader connection, it cannot extend as far as this case. Lufthansa could have disclosed that information even if it did not maintain offices and conduct flights to California. Unlike Ford, the relevant conduct (the disclosure of their information) did not occur in the forum. Extending “relate to” to this case would resurrect the “doing business” theory of personal jurisdiction—that because Lufthansa does substantial business in California, it can be sued there on events occurring outside the state. Daimler and Good Year reject that theory.
Traditional notions of fair play and substantial justice
It must be reasonable, in a federal system, to make the defendant litigate in a foreign forum. Shoe. The court balances five factors--the burden on the defendant from having to litigate in the forum, the plaintiff’s interest in a convenient forum, the state’s interest in enforcing its laws and providing a remedy, the shared state interests in efficient resolution, and the interstate interests in substantive outcomes. The first three are the most significant. Burger King; World Wide. Where the plaintiff has purposefully availed, the defendant bears the burden of making a “compelling” case that jurisdiction is unreasonable and jurisdiction will be found unreasonable only in extraordinary cases. BK.
California does not have a strong interest in providing the forum for this action. Roe did not live there at the time of the events and the relevant events occurred in two foreign countries. Courts should hesitate before bringing non-U.S. defendants into their states.
The court lacks jurisdiction even if it finds Defendants failed to make a compelling case that California is an unreasonable forum. Because they do not have minimum contacts with the state, they are not subject to jurisdiction, no matter how convenient or fair jurisdiction might be.
