With updated answers.
You work as a litigation associate in a large New York law firm. A partner calls you into her office and says that a summons and complaint have been served on D Corp (hereinafter D), a for-profit chain of hospitals, and on E, a doctor employed by D. Both are your firm's clients. Before your firm looks into the facts with the clients to determine how to answer the compliant, she wants you to quickly look into some possible preanswer responses.
She gives you the following information. The plaintiff in the action, P, is bringing a diversity suit against D and E for medical malpractice under New York law in the federal district court for the Eastern District of California. Service was on D was effected by having a process server give a copy of the summons and complaint to D's CEO's secretary, while the CEO was at his office in CA. Service on E was effected by having a process server give a copy of the summons and complaint to E while he was at work in NY.
P currently resides in her summer home in the foothills of the Sierras, in the Eastern District of California. She is recovering there from complications resulting from a gall bladder operation performed by E that took place in one of D's hospitals in New York City. She chose to reside in the summer home, because it is only a few blocks from the best post-operative care facility in the United States, which E recommended that she enter after the complications with her operation became clear. Before the operation, she lived in her permanent home in New York City and visited the summer home for only a few weeks out of the year.
D is incorporated in California and has its administrative headquarters at its founding hospital in Los Angeles, in the Central District of California. The board of directors meets in Los Angeles and the Chief Executive Officer of D lives and works in Los Angeles. D has three hospitals, one is New York City, one in Albany, New York; and one in Los Angeles. D's sole shareholder is F, whose home is in New York City. D does advertising solely in Los Angeles, New York City and Albany.
E has his home in Greenwich, Connecticut and works in D's hospital in New York. He is a famous gall bladder surgeon and performs surgery all over the country. He has performed surgery similar to that performed on P a number of times in Los Angeles and in San Francisco (which is in the Northern District of California) but never in the Eastern District of California. He has, however, attended a gall bladder conference in Sacramento, which is in the Eastern District of California. During the week prior to her surgery P was at her summer home and P and E spoke a number of times on the phone concerning the operation. Some of these calls originated from E's home in Greenwich.
Draw up a brief memo for the partner on possible preanswer responses to P's complaint. If there is something that you need to know but can't tell from the question, say what it is.
Covering all the bases was heavily rewarded in this relatively easy essay question.
Motion to Dismiss for Inadequate Service
Service on D was probably in accordance with Fed. R. Civ. P. 4(h) - since the CEO is clearly an officerand giving a copy of the summons and complaint to the CEO's secretary probably count as "delivering" it to him. Unlike 4(e), 4(h) does not speak of delivering "personally" so it is probably not necessary that service is in hand. We discussed this in class. Service on E was in accordance with Fed. R. Civ. P. 4(e).
Motion to Dismiss for Lack of Subject Matter Jurisdiction
You should have noted that the case is brought under diversity and that complete diversity could fail to exist in two ways: both P and D could be domiciled in New York or both P and D could be domiciled in California. You should have mentioned that E, who is domiciled in Connecticut, is not a possible diversity-destroying party.
You should have begun by stating the test for domicile for an individual -- presence in the state with an intent to make the state one's home for the indefinite future. Clearly before the operation New York was P's domicile. It will remain her domicile unless she established a domicile in California. The question is whether P intends to make California her home for the indefinite future. She probably does not. She probably intends to remain there until she recovers. Although when she recovers is indefinite, that's not enough to make California her domicile. Think of World Wide Volkswagen, where the family who had the accident in Oklahoma and resided but was not domiciled there during their recovery.
What about D's domicile? As a corporation it has two domiciles - its state of incorporation (California) and its principal place of business. Under the nerve center test, which the Supreme Court has now accepted in Hertz, its PPB is California. You should have noted that the residence or domicile of D's shareholder is irrelevant to determine D's domicile.
Finally you should have mentioned the problem of the jurisdictional minimum for diversity. It may be that the amount in controversy is less than $75,000. You should have indicated to the partner that the complaint should be examined to determine this.
Motion to Dismiss for Lack of Personal Jurisdiction
You should have looked to whether there is personal jurisdiction over D and E. This examination involves a number of parts. First of all there is the 5th Amendment due process examination of whether personal jurisdiction over the defendants by a federal court is constitutional. Clearly it is because both of them have sufficient International Shoe contacts with the United States.
But you then need to look to the requirements of Fed. R. Civ. P. 4(k) which, with some exceptions irrelevant to this case, limits the personal jurisdiction of federal courts to the personal jurisdictional reach of a state court in the same state where the federal court is located. The question then becomes whether a California state court would have personal jurisdiction over the defendants.
The 4(k) test has a number of parts. The first is the International Shoe 14th Amendment due process test. There is no question that D has sufficient International Shoe contacts with California. It is incorporated in California and has a hospital there. This is enough for there to be general jurisdiction over D, that is, jurisdiction sufficient for D to be sued on any cause of action, even one that occurred in New York. Service on D's CEO in CA, however, does not create PJ on D.
The International Shoe problem is more pressing with respect to E. Here only specific jurisdiction is possible. You could go either way here but there were certain things I wanted you to look to. Most importantly, you needed to look to the relatedness of the trips, phone calls, and conference attendance to the cause of action against E. The level of relatedness is essential to specific jurisdiction. With respect to the phone calls, you should have noted whether they were initiated by E or not and whether he solicited the operation through the phone calls or not. If they were not the solicitation of the operation they are probably not enough to establish personal jurisdiction. The level of relatedness to the activities being sued upon would be too low. The situation is not like McGee, where the contact with California (the contract of reinsurance mailed by the defendant to the plaintiff's son in California) was the very thing being sued upon. The plaintiff is not suing concerning these phone calls. Likewise, the operations that E engaged in in California would never be considered by a court to be sufficient for specific jurisdiction, because they are unrelated to P's cause of action.
Furthermore, these trips are not sufficient connections with CA to establish general jurisdiction either. Here it was useful to speak of the criteria for general jurisdiction over corporations under Perkins and Goodyear, since we are trying to get PJ over E when he is engaged in his business. For example, there would arguably be general PJ over E in New York, even thought E is domiciled in CT, because E has systematic and continuous contacts (or is "at home") in NY. But the contacts with California are not enough for that.
You should also have noted another candidate for specific personal jurisdiction over E -- E's recommending that P go to California to recover. Can a defendant reach out to a forum state for specific PJ purposes after the event that gave rise to the cause of action (in this case the operation)? It would be especially helpful if some of the damages P sustained materialized while P was in CA at E's suggestion. Once again, you could have gone either way here, but sensitivity to how related the activities allegedly establishing personal jurisdiction over E were to the activities being sued upon was necessary.
You should also have mentioned the fairness (vs. power) considerations for exercising personal jurisdiction over E, or what I have called in class the McGee factors - such as the burden on P of going to an alternative forum and the burdens on E of appearing in CA.
Finally you should have mentioned the impact of California's long-arm statute and its state constitution on personal jurisdiction. The effect of both would have to be examined with respect to both D and E. You didn't have to know the content of either, but you merely needed to mention that each would have to be examined to see whether they restrict personal jurisdiction further than the 14th Amendment.
A Motion to Dismiss for Lack of Venue
There are three ways that there could be venue for the action in the E.D. Cal. under 1391. If one defendant resided in the E.D. Cal., then venue would be possible if both defendants resided in California. This provision is inapplicable because both defendants do not reside in California. E clearly resides (that is, is domiciled) in Connecticut. (One does not use the personal jurisdiction test for residence on E because he is not a corporation.)
The second is if a substantial part of the actions or omissions giving rise to the claim occurred in the E.D. Cal. You could have gone either way here. It is barely possible that P's having to go to the E.D. Cal. to recover is a substantial part of the events giving rise to the claim, especially if some of the damages for which P is suing materialized during the time in CA.
The final possibility (the fall-back provision) would apply if there is no other district that would have venue. If that's the case, then venue would exist in any district where a defendant is subject to personal jurisdiction. But there is clearly venue in the Southern District of New York, where the operation occurred. So this doesn't apply either.