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WHAT'S "SOVEREIGNTY" GOT TO DO WITH IT? DUE PROCESS, PERSONAL JURISDICTION, AND THE SUPREME COURT
Wendy Collins Perdue•
I. BACK TO THE FOUNTAINHEAD: PENNOYER V. NEFF .................................... 730
IT. DUE PROCESS AS A SOURCE OF SUBSTANTIVE STANDARDS ....................... 733
ill THE ROLE OF SOVEREIGNTY ....................................................................... 734
IV. CONFUSION NOW HATH MADE ITS MASTERPIECE ...................................... 740
V. CONCLUSION ............................................................................................... 743
Something about personal jurisdiction seems to bring out the worst in the Supreme Court. In the last twenty-four years, the Court has decided four personal jurisdiction cases, and in three of them, it has been unable to muster a
majority opinion. 1 Between Burnham v. Superior Court in 1990, and J.
Mcintyre Machinery, Ltd. v. Nicastro and Goodyear Dunlop Tires Operations,
S.A. v. Brown in 2011, the Court's composition has almost completely changed,
with only Justices Scalia and Kennedy remaining.^2 Yet, the current Court is just as splintered as the old one. Personal jurisdiction also seems to inspire foolish
remarks and poor opinions, and Nicastro may set a new low in that regard.
At least part of the problem sterns from confusion over the sovereignty limitations inherent in personal jurisdiction, and the relationship between sovereignty concerns and due process in personal jurisdiction analysis. This
confusion plays out vividly in Nicastro, with Justice Kennedy asserting that the
problem with Justice Brennan's approach in Asahi was that "[i]t discarded the
central concept of sovereign authority in favor of considerations of fairness and foreseeability." 3 By contrast, Justice Ginsburg asserts that "constitutional limits on a state court's adjudicatory authority derive from considerations of due process, not state sovereignty." 4 Both statements are wrong, or are at least misleading. In this symposium contribution I do two things. First, I explore the relationship between sovereignty and due process in personal jurisdiction
*Dean and Professor of Law, University of Richmond School of Law. I am very grateful to Richard Freer and Corinna Lain for their comments and suggestions. I. Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (20 11) (decided by a majority of the Court); J. Mcintyre Mach., Ltd. v. Nicastro, 131 S. Ct. 2780 (2011) (plurality opinion); Burnham v. Superior Court, 495 U.S. 604 (1990) (plurality opinion); Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102 (1987) (plurality opinion).
- Compare Burnham, 495 U.S. at 606-07, with Nicastro, 131 S. Ct. at 2785.
- Nicastro, 131 S. Ct. at 2788 (plurality opinion).
- !d. at 2798 (Ginsburg, J., dissenting).
729
730 SOUTH^ CAROLINA^ LAW^ REVIEW^ [VOL.^ 63: 729
doctrine. Second, I examine how confusion about this relationship is manifested in some of the more problematic aspects of the Nicastro opinions. I conclude that, although at one time the concept of sovereignty provided an important analytic component of personal jurisdiction analysis, this is largely no longer true.
I. BACK TO THE FOUNTAINHEAD: PENNOYER V. NEFF
Much of the credit (or blame) for modem personal jurisdiction doctrine dates back to Pennoyer v. Neff. 5 It is there that the Court explicitly addressed concerns about sovereignty and, for the first time, introduced the Due Process Clause into personal jurisdiction doctrine.^6 However, these two elements-sovereignty and due process-were approached in Pennoyer quite differently than they are described in modem opinions, so it is worth revisiting what Pennoyer actually said. Justice Field's personal jurisdiction analysis began by focusing on states and the scope of their power. He noted that except as limited by the Constitution, states "possess and exercise the authority of independent States," and that the principles of international law concerning personal jurisdiction are applicable to the states. 7 He then laid out what he believed to be universal and undisputed principles of public international law-that "every State possesses exclusive jurisdiction and sovereignty over persons and property within its territory," and that "no State can exercise direct jurisdiction and authority over persons or property without its territory." 8 From these principles, Justice Field concluded that in-state service is a necessary prerequisite for personal jurisdiction. 9 To the extent that Field believed that in-state service is a necessary corollary of territorial boundaries, the opinion is undeniably wrong. Many territorially defined nations do not agree that in-state service is either necessary or sufficient. 10 Nonetheless, Field's broader analytic approach is significant. In determining the scope of state judicial authority, his analysis focused on the state, not the defendant. Field formulated his jurisdictional inquiry by asking what power a state has over people inside and outside its boundaries, rather than asking when defendants are subject to jurisdiction.ll Additionally, Field saw nothing in our federal structure that limits our states differently than nations are limited with respect to the substantive scope of their personal jurisdiction
- 95 U.S. 714 (1878).
- See id. at 722, 733.
- /d. at 722.
- /d. (citing JOSEPH STORY, COMMENTARIES ON THE CONFLICf OF LAWS 19-20 (2d ed. 1841); HENRY WHEATON, ELEMENTS OF INTERNATIONAL LAW 110-11 (George Grafton Wilson ed., WilliamS. Hein & Co. photo. reprint 1995) (Richard Henry Dana, Jr. ed., 1866)).
- /d. at 733.
- See Russell J. Weintraub, An Objective Basis for Rejecting Transient Jurisdiction, 22 RUTGERS L.J. 611, 613-16 (1991).
- See Pennoyer, 95 U.S. at 722.
732 SOUTH CAROLINA LAW REVIEW [VOL. 63: 729
Significantly, although Justice Field invoked the Fourteenth Amendment as a tool for challenging a judgment rendered without jurisdiction, the Court nowhere suggested that the Due Process Clause provided the substantive criteria for jurisdiction. This is evident in the structure of the opinion. The principles of jurisdiction are found in the beginning of the opinion before the discussion of the Fourteenth Amendment. 18 The Due Process Clause was introduced towards the end of the opinion after Field had already delineated the scope of states' jurisdictional authority. Treating the Due Process Clause as a tool to challenge enforcement of a judgment, but not as a source of the substantive criteria, also allows Pennoyer to fit more comfortably within the preexisting Full Faith and Credit Clause cases which had long reco~nized the existence of limits on personal jurisdiction and which Field cited. 1 Under Pennoyer' s approach, the Full Faith and Credit Clause continues to control in the inter-state context and the Due Process Clause simply provides a vehicle to transport the principle developed in the interstate full faith and credit context to the intra-state context. Using the Due Process Clause as a tool to challenge invalid judgments, but not as the source of the standards for validity, is completely consistent with the principle that the Due Process Clause protects individual rights. Due process requires that a judgment be rendered by a court of competent juris diction. 20 The right that is protected by that clause is the right not to have liberty or property taken by a state that is acting "coram non judice"-without legitimate authority. 21 Thus, from a broad structural perspective, Pennoyer established several noteworthy propositions. First, the state and an understanding of the scope of state power is the appropriate starting point for analyzing personal jurisdiction. Second, there is nothing unique in our federal structure that requires substantive limitations on our states that are different from those that exist in the international context. Third, the Due Process Clause provides a basis for resisting in-state enforcement of a judgment that exceeds a state's legitimate authority, but it does not provide the standards for determining the scope of each state's jurisdictional reach. Over the next century and a half, all three of these propositions were altered, although in most cases without explicit reexamination.
- See id. at 721-23.
- See id. at 729-30 (citing D'Arcy v. Ketchum, 52 U.S. 165, 174 (1850) (holding that a New York judgment was not entitled to full faith and credit in Louisiana because one of the defendants was not served with process); M'Elmoyle v. Cohen, 38 U.S. 312, 327 (1839) (holding that the Full Faith and Credit Clause applied only when the court rendering the decision had jurisdiction of the parties)).
- See id. at 733.
- See id.
2012] WHAT'S "SOVEREIGNTY" GOT TO DO WITH IT? 733
ll. DUE PROCESS AS A SOURCE OF SUBSTANTIVE STANDARDS
Although Pennoyer introduced the Due Process Clause as a mechanism that would allow a direct challenge to excessive exercises of jurisdiction, by the twentieth century the Due Process Clause began to assume a more substantive role. This is apparent in the way the Supreme Court and litigants began to frame and understand the issue presented in personal jurisdiction cases. Consider Hess v. Pawloski.Z^2 In that case, a Massachusetts statute designated a state official to be the agent for service of process for any non-resident who drove a car into Massachusetts and was subsequently sued on a claim arising out of an automobile accident in Massachusetts.Z 3 If the issue were framed using the structure described in Pennoyer, the question presented would have been whether in acting pursuant to this statute, Massachusetts lacked legitimate authority and, as a result, enforcement of any subsequent judgment would have violated the Due Process Clause. Not surprisingly, that awkward formulation was framed instead as "whether the Massachusetts enactment contravenes the due process clause of the Fourteenth Amendment." 24 While Hess's statement of the issue presented might have reflected simply a more streamlined use of language, by the time of International Shoe,^25 it was clear that the Due Process Clause was providing substantive criteria. In what is probably the most widely quoted sentence from International Shoe, Justice Stone suggests that the substantive criteria for personal jurisdiction derives from due process:
[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice." 26
Under the Pennoyer approach, the due process violation consisted of enforcing a judgment rendered by a court that lacked legitimate authority, but the standards for determining legitimacy were derived separately from that clause. In contrast, International Shoe suggests that the Due Process Clause itself embodies certain criteria for legitimacy. In World- Wide Volkswagen/ 7 the transformation of due process from a mechanism to allow a direct challenge of jurisdiction to the source of substantive
- 274 U.S. 352 (1927).
- ld. at 354 (quoting MASS. GEN. LAWS ANN. ch. 90, as amended by Stat. 1923, ch. 431, § 2 (current version at MASS. GEN. LAWS. ANN. ch. 90 § 3A (West 2001)).
- Id. at 355.
- Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945).
- ld. at 316 (emphasis added) (quoting Milliken v. Meyer, 311 U.S. 457,463 (1940)).
- World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980).
2012] (^) WHAT'S "SOVEREIGNTY" GOT TO DO WITH IT? 735
consider the state's need for the tools to collect those taxes it was due, dramatically highlights that state power was no longer the analytical starting point. In place of a focus on the sovereignty needs of the state, Justice Stone created, largely out of whole cloth, 34 the now famous language that the defendant must have "certain minimum contacts with [the state] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial JUS^.^ t'lCe.^ ,, Justice Black, in his prescient concurrence in International Shoe, recognized that although the majority's holding expanded state jurisdictional authority, its analytic approach was not state-centered and indeed threatened state power. 36 He understood that states needed jurisdictional power in order to fully exercise other legitimate interests in protecting their citizens and implementing their laws. 37 He expressed the concern that "fairness" might be used to restrict the power of states to exercise judicial authority in support of their other legitimate interests, writing:
I believe that the Federal Constitution leaves to each State, without any "ifs" or "buts," a power to tax and to open the doors of its courts for its citizens to sue corporations whose agents do business in those States. Believing that the Constitution gave the States that power, I think it a judicial deprivation to condition its exercise upon this Court's notion of "fair play," however appealing that term may be. Nor can I stretch the meaning of due process so far as to authorize this Court to deprive a State of the right to afford judicial protection to its citizens on the ground that it would be more "convenient" for the corporation to be sued somewhere else. 38
Justice Black went on to observe: "True, the State's power is here upheld. But the rule announced means that tomorrow's judgment may strike down a State or Federal enactment on the ground that it does not conform to this Court's idea of natural justice." 39 Not surprisingly, Justice Black later dissented in Hanson v. Denckla,^40 a case that further reinforced the shift away from the state as the analytic starting point of the personal ~urisdiction analysis. Cases such as McGee v. International Life Insurance Co.^4 and Hess v Pawloskz^42 had focused on the state's interest in
- See Cameron & Johnson, supra note 31, at 809-10.
- lnt'l Shoe, 326 U.S. at 316 (citing Milliken v. Meyer, 311 U.S. 457,463 (1940)).
- See id. at 323 (Black, J., concurring).
- See id.
- /d. at 324-25.
- /d. at 326.
- 357 U.S. 235, 256 (1958) (Black, J., dissenting).
- 355 u.s. 220, 223-24 ( 1957).
- 274 u.s. 352, 356 (1927).
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providing a forum. These cases were dismissed by the Hanson majority as exceptions, 43 and the Court offered a new verbal formulation, which added the requirement that "the defendant purposefully avail[] itself of the privilege of conducting activities within the forum State."^44 The Court cited International Shoe as the source of the purposeful availment requirement, though no such language appears in that case. International Shoe does say that a state cannot assert personal jurisdiction over a defendant "with which the state has no contacts, ties, or relations," 45 but the opinion does not say that the contacts must have been created by the defendant. Justice Black, in his Hanson dissent, focused, as he had in International Shoe, on the state. He discussed "Florida's interest" in the dispute and the many connections the dispute had with Florida, 46 and then observed that:
[W]here a transaction has as much relationship to a State as Mrs. Donner's appointment had to Florida its courts ought to have power to adjudicate controversies arising out of that transaction, unless litigation there would impose such a heavy and disproportionate burden on a nonresident defendant that it would offend what this Court has referred to as "traditional notions of fair play and substantial justice." 47
In other words, Justice Black began by focusing on the state and then turned to concerns about the defendant as a kind of second-stage safety valve for the rare case that imposed unusual burdens. He was attentive to concerns about territoriality, and explained that there was nothing in his approach that was indifferent to state boundaries:
Of course we have not reached the point where state boundaries are without significance, and I do not mean to suggest such a view here. There is no need to do so. For we are dealing with litigation arising from a transaction that had an abundance of close and substantial connections with the State of Florida. 48
While Justice Black put the state at the center of the inquiry, the majority in Hanson focused on the activities of the defendant and this approach became even more frrmly established in World- Wide Volkswagen. 49 World- Wide Volkswagen
- See Hanson, 357 U.S. at 251-53; Philip B. Kurland, The Supreme Coun, the Due Process Clause and the In Personam Jurisdiction of State Courts: From Pennoyer to Denckla: A Review, 25
u. em. L. REv. 569,621-22 (1958).
- Hanson, 357 U.S. at 253 (citing Int'l Shoe, 326 U.S. at 319).
- lnt'l Shoe, 326 U.S. at 319.
- Hanson, 357 U.S. at 257-59 (Black, J., dissenting).
- !d. at 258-59 (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940); Int'l Shoe, 326 U.S. at316).
- !d. at 260.
- World-Wide Volkswagen v. Woodson, 444 U.S. 286 (1980).
738 SOUTH CAROLINA LAW REVIEW [VOL. 63: 729
focuses on the defendant and whether it has acted purposefully to affiliate itself with the forum. 55 Two years after World-Wide Volkswagen, the Court in Insurance Corp. of Ireland^56 explicitly recognized the reality of modern personal jurisdiction doctrine-that it was no longer a state-centered doctrine, but defendant-centered instead. As the Court explained: "The personal jurisdiction requirement recognizes and protects an individual liberty interest. It represents a restriction on judicial power not as a matter of sovereignty, but as a matter of individual liberty." 57 Of course, as noted above, even when the analysis is not sovereignty- based, personal jurisdiction remains a doctrine about sovereignty in the definitional sense that whatever jurisdictional reach the Court accords a state is by definition the scope of its jurisdictional sovereignty. In a footnote, the Court explicitly embraced the view that the Due Process Clause is the source of the substantive criteria for personal jurisdiction: "The restriction on state sovereign power described in World- Wide Volkswagen Corp.,. .. must be seen as ultimately a function of the individual liberty interest preserved by the Due Process Clause. That Clause is the only source of the personal jurisdiction requirement ...." 58 The Court's analysis includes an inaccurate premise-it is not true that the Due Process Clause "is the only source of the personal jurisdiction requirement." Limitations on personal jurisdiction were addressed under the Full Faith and Credit Clause long before the Fourteenth Amendment even existed. 59 Still, the statement leaves no doubt that the Court has moved away from the more limited function of due process that the Court in Pennoyer set forth. The Court in Insurance Corp. of Ireland also explicitly rejects "federalism" as a restriction on jurisdiction:
[T]he [Due Process Clause] itself makes no mention of federalism concerns. Furthermore, if the federalism concept operated as an independent restriction on the sovereign power of the court, it would not be possible to waive the personal jurisdiction requirement: Individual actions cannot change the powers of sovereignty, although the individual can subject himself to powers from which he may otherwise be protected. 60
The Court is certainly correct that the Due Process Clause is not a provision directed at federalism. The Fourteenth Amendment was enacted to protect people (particularly the newly freed slaves) from states, not to protect states from
- See World- Wide Volkswagen, 444 U.S. at 295.
- Ins. Corp. of Ir. v. Compagnie des Bauxites de Guinee, 456 U.S. 694 (1982).
- /d. at 702.
- /d. at 703 n.IO.
- See supra text accompanying note 19.
- Ins. Corp. of Jr., 456 U.S. at 702-03 n.lO.
2012] WHAT'S "SOVEREIGNTY" GOT TO Do WITH IT? 739
other states. However, the Court's waiver argument is not particularly persuasive. It is not true that a federalism-based constraint on state power would preclude waiver by private litigants. Federalism concerns animate the limitations on legislative jurisdiction (i.e., choice of law). 61 Nonetheless, if the parties do not raise a choice of law issue, most courts will apply forum law on the theory of party acquiescence. 62 Notwithstanding Insurance Corp. of Ireland's explicit rejection of sovereignty as a core component of personal jurisdiction, the theme of sovereigntl has persisted and, as discussed below, returned to center stage in Nicastro.^6 One explanation for this persistence is that regardless of whether sovereignty does any analytic work, there is a sense in which all personal jurisdiction cases are about sovereignty. The power to exercise judicial authority is an important element of state sovereignty, just as "legislative jurisdiction"- the power of a state to regulate conduct through its substantive law-is an important aspect of state sovereignty. Sovereignty used in this sense tells us nothing about the proper analytic approach to personal jurisdiction, it is simply the label we apply to whatever judicial authority is granted to the states. Thus, even a defendant-focused approach to personal jurisdiction, or one based solely on considerations of fairness, is ultimately about sovereignty since the outcome of the analysis tells us, essentially by definition, the extent to which the state will be able to exercise this element of sovereign authority. But there is a critical difference between using sovereignty in this definitional sense and the approach of Justices Field and Black. Those Justices put the state at the center of their analytic approach. In contrast, the Court in World-Wide Volkswagen focuses its analysis on the defendant and the defendant's conduct, not on the state. Having determined that Oklahoma could not exercise jurisdiction, the Court likewise determined the scope of Oklahoma's "sovereignty." However, sovereignty is what is left at the end of the analysis, rather than the starting point. To summarize, the changes since Pennoyer are these: Due process has been transformed from a tool to challenge otherwise void judgments into a doctrine that provides the standard for assessing whether personal jurisdiction should be permitted. Moreover, the core inquiry in personal jurisdiction is no longer a state-centered inquiry that focuses on the nature of state sovereignty, but rather a defendant-centered inquiry. Finally, the Court has implied, by its references to federalism that there is something unique within our federal system that requires a different approach to jurisdiction than exists in international law, though it has never explicitly articulated what those differences are.
- See Alaska Packers Ass'n v. Indus. Accident Cornrn'n, 294 U.S. 532, 544-47 (1935) (discussing full faith and credit limits on choice of law).
- See PETER HAY, PATRICK J. BORCHERS & SYMEON C. SYMEONIDES, CONFUCf OF LAWS 610 (5th ed. 2010).
- See infra text accompanying notes 67-71.
2012] WHAT'S "SOVEREIGNTY" GOT TO Do WITH IT? 741
jurisdiction in tort cases in the place where the harmful event occurs. 72 Kennedy's opinion, maybe by way of response, refers to "the premises and unique genius of our Constitution." 73 Justice Field in Pennoyer thought that states were sufficiently like nations for purposes of jurisdiction and that international law provided the appropriate set of principles. 74 Justice Kennedy is not alone in ignoring this aspect of Pennoyer, but the invocation of general language about the "unique genius of our Constitution" does not begin to explain why we have rejected this aspect of Pennoyer. What is unique about our federal system is the presence of a Full Faith and Credit Clause. 75 Among independent nations, a country may exercise its judicial sovereignty as it sees fit, but it runs the risk that other nations may not enforce its judgments. Unlike independent nations, states are not free to decide for themselves which judgments they will and will not enforce. They are also not free to enter into treaties or conventions with each other and thereby negotiate about what would constitute a sensible allocation of judicial authority. Because of the Full Faith and Credit Clause, we need a federal standard delineating what judgments are enforceable under that clause. But there is nothing in that clause that requires the adoption of any particular standard or approach to jurisdiction. Justice Field thought that the operative standard under the Full Faith and Credit Clause was "natural justice" and the "rules of public law which protect persons and property within one State from the exercise of jurisdiction over them by another."^76 Justice Kennedy may think otherwise, but he has identified nothing inherent in our federal structure that mandates a particular set of jurisdictional rules. Notwithstanding Kennedy's insistence that his approach is based on sovereignty, it seems instead to be based on a particular notion of individual liberty. Kennedy's focus on "purposeful availment" by the defendant and "submission" 77 suggests that Kennedy believes that defendants have a liberty interest in not being subject to the governmental authority of a state with which they have not affirmatively affiliated themselves. To the extent Kennedy's approach to jurisdiction is informed by a conception of state sovereignty, Justice Kennedy apparently believes that states have no power or authority separate from what is conferred by the defendant. 78 Kennedy argues first that the foundational element of personal jurisdiction is whether the defendant "manifest[ed] an intention to submit to the power of a
- See id.
- ld. at 2789 (plurality opinion).
- See supra text accompanying note 7.
- U.S. CONST. art. IV, § 1.
- Pennoyer v. Neff, 95 U.S. 714, 730 (1878) (quoting Lafayette Ins. Co. v. French, 59 U.S. (18 How.) 404,406 (1855)) (internal quotation marks omitted).
- Nicastro, 131 S. Ct. at 2787-88 (plurality opinion) (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408,414 (1984); Hanson v. Denckla, 357 U.S. 235, 253 (1958)).
- See id.
742 SOUTH CAROLINA LAW REVIEW [VOL. 63: 729
sovereign." 79 He explains that "it is the defendant's actions ... that empower a State's courts to subject him to judgment." 80 In his view, a state's jurisdictional authority is conferred in any particular case by the actions of the defendant and not by preexisting authority. State courts apparently have no more inherent authority than private arbitration panels and are impotent in the judicial arena unless and until they have been empowered by the particular defendant. Thus, to the extent Kennedy's approach is sovereignty-based, it reflects the view that states' sovereign powers are quite limited. Kennedy's strong embrace of the language of sovereignty in Nicastro is met with an equally strong rejection of the concept by Justice Ginsburg. In her dissent, Ginsburg explains that "the constitutional limits on a state court's adjudicatory authority derive from considerations of due process, not state sovereignty,"^81 and that the "modern approach to jurisdiction" gives "prime place to reason and fairness." 82 She concludes that "it would undermine principles of fundamental fairness to insulate the foreign manufacturer from accountability in court at the place within the United States where the manufacturer's product caused injury." 83 Justice Ginsburg insists that jurisdiction is a concept grounded solely in due process and concerns for the protection of the individual liberty of the defendant. 84 Yet ironically, Ginsburg seems to be approaching jurisdiction not from the point of view of the individual defendant, but from a broader institutional perspective of state power. At one point in her opinion Justice Ginsburg asks:
On what sensible view of the allocation of adjudicatory authority could the place of Nicastro's injury within the United States be deemed off limits for his products liability claim against a foreign manufacturer who targeted the United States (including all the States that constitute the Nation) as the territory it sought to develop? 85
Her very phrasing of the question puts the "sensible... allocation of adjudicatory authority" at the center of her concerns. Likewise, the focus of her fairness analysis is not limited to the particular defendant in the case before her. Instead, she considers the realities of modern marketing 86 and worries about the impact of this jurisdictional ruling on domestic producers.^87 Thus, while Justice
- /d. at 2788.
- /d. at 2789.
- /d. at 2798 (Ginsburg, J., dissenting).
- !d. at 2800.
- /d. at 2801-02.
- See id. at 2798.
- /d. at 2797.
- See id. at 2799-801.
- See id. at 2803-04.
