Venue and Forum Non Conveniens

Venue

• § 1390(a): gives a definition of venue. “Venue refers to the geographic specification of the proper court or courts for the litigation of a civil action that is within the [SMJ] of the district courts in general.” 

  • Works with personal jxn requirements, which are also geographical. However, unlike personal jxn, venue is purely statutory.

  • We focus on § 1391(a)-(d), but there are other venue statutes in § 1391 and elsewhere that have special requirements. As with personal jxn, parties can consent to venue + waive venue objections by failing to assert the defense under Rule 12. A valid forum selection clause constitutes consent to PJ and venue.  

• § 1391(b) Venue in General

  • Residential Venue Provision (1): Venue is available in any district where all D in an action resides.

    • If one of D lives in a state different from another, venue is improper.

    • Natural people are deemed to reside in the judicial distric where they are domiciled. § 1391(c)(1).

    • Corporations and unincorporated associations are deemed to reside in any state in which they are subject to personal jxn. § 1391(c)(2).

    • If D is subject to personal jxn in a state with more than one judicial district, they will be deemed to reside in each district where D’s contact would be sufficient support for personal jxn if it were a separate state.

      • If no such district exists, D will be deemed to reside in the district where D has the most significant contacts. § 1391(d). Because (d)) is more specific than (c)(2), its best to start your analysis with (d) and the move to (c)(2) if the result is unclear.

  • Transactional Venue Provision (2): Venue is available in any district “in which a substantial part of the events or omissions giving rise to the claim occurred,” or “a substantial part of property that is the subject of the action is situated.”

    • More than one district may qualify under (b)(2).

  • (3): Fallback provision in case venue is not available in ANY federal district. Venue is properly available in a district in which any D is subject to personal jxn.

• § 1391(c)(3): provides that “A D not resident in the US may be sued in any judicial district” and joinder of that D is disregarded when determining venue for any other D. 

  • Includes American citizens not domiciled in the US and any alien not lawfully admitted into the US.

Transfer of Venue

• Transfer vs. Forum Non Conveniens: Transfer refers to transfer of a suit from one federal district to another. Transfer is only available between courts of the same judicial system. 

  • Federal courts dismiss on grounds of forum non conveniens only when they conclude that the entire federal judicial system would be an inappropriate forum.

  • If the question is whether the suit should be heard in another federal district b/c of the convenience of the parties and witnesses, the case must be transferred under § 1404(a) and not dismissed under forum non conveniens. Because a transfer is a less drastic remedy, it is easier to transfer. 

• § 1404(a): Authorizes transfer if venue and personal jxn are proper in transferor district. 

• § 1406(a) Offers transfer when venue is lacking or when venue and personal jxn are lacking. Goldlawr v. Heiman (venue + PJ). 

  • What about when venue is properly laid, but court lacks PJ? Three solutions: 

    • § 1404(a) but typically does not apply when PJ is invalid

    • § 1406(a) while it does not reference PJ, one could reade it broadly enough to include when PJ is invalid.

    • § 1631 but the problem this is that it wasn’t designed to address problems of PJ, it’s about defects in federal subject matter jxn 

  • None of these fit perfectly, but courts tend to rely on one when venue is properly laid, but transferor court lacks PJ. If venue is properly laid but PJ is lacking.

• Sections 1404(a), 1406(a), and 1631 each require that the transferee district be a district “where [suit] might have been brought” or “to which all parties consented.”

  • Hoffman: Transferee court must have: (1) venue, (2) venue must have been properly laid at the time the suit was originally filed in the transferor district, and (3) personal jxn over D at the time the suit was filed.

    • Although sections 1406(a) and 1631 use different language (“could have been brought”), there is no reason to think the difference matters.

  • 1404(a) allows transfer to districts or divisions to which all parties consented before suit was brought (i.e., a valid forum selection clause).

    • Does not apply to §§ 1406(a) or 1631.

Atlantic Marine v. District Court: Personal jxn and venue can be proper in a court not mentioned in a forum selection clause.

Horizontal Choice of Law in Federal Court

• Background: 

  • Horizontal Choice of Law: How a state chooses which state’s or foreign country’s law to apply. The Constitution places minimal constraints on the states.

  • Klaxon v. Stentor Elec. Mfg. Co.: a federal court must apply the choice-of-law rules of the state in which it sits. What about after transfers?

• Choice of Law after Transfer: 

  • Van Dusen v. Barrack: Klaxon doesn’t apply when the transferor court has PJ and venue. Instead, the choice-of-law rules of the state in which the transferor court sits applies. 

    • However, if transfer is sought to: (a) cure a jxnal defect or, (b) honor a valid forum-selection clause, the transferee court will apply Klaxon. 

• Why did SCOTUS create the Van Dusen rule? 

  • The Court refused to apply the Klaxon rule when PJ and venue are proper in the transferor court because it would violate the Erie policy.

    • Klaxon promotes vertical uniformity for transfers from transferors that were never able to hear an action. Van Dusen promotes vertical uniformity by respecting P’s choice of forum while also promoting convenience.

  • There is no reason to think that Congress intended to depart from Erie. 

  • A different rule might discourage a federal district from ordering transfer when the choice of law rules in this state might disadvantage the P. 

  • If D could get a different set of choice of law rules simply by getting a transfer, that would encourage the D to forum shop for choice of law rules. 

• Van Dusen’s Two Open Questions

  • Does Van Dusen apply if the courts of the state in which the transferor court sits would have dismissed the suit on the grounds of forum non conveniens?

    • The Erie policy would suggest that the Van Dusen rule should not apply. It does not make sense to require a federal court in another state to apply the rules of a state that would not even hear the action.

  • Does Van Dusen apply when the P rather than the D makes the transfer filing? 

    • Ferens resolves this question. 

Ferens v. John Deere Co.

• Facts: P lost hand in machine manufactured by D → P waited 3+ years to file suit → P filed claims in PA and a tort claim in S.D. of MS → D waived PJ and venue objections → P then filed a motion to transfer the tort claim to PA → D didn’t oppose the transfer b/c hoped to invoke the PA S/L → PA applied PA S/L → P appealed to 3rd Cir, which affirmed on the basis that applying the MS would violate DPC b/c MI had no legitimate interest in applying its S/L → SCOTUS reversed and remanded after Sun Oil, which held that a state could apply its own S/L to another state’s substantive law → On remand, 3rd Cir affirmed again b/c Van Dusen doesn’t apply when P seeks transfer → SCOTUS held Van Dusen applies when P seeks transfer out of a court where PJ and venue are proper. 

While PJ and venue were proper in Ferens, Daimler makes it unlikely that MS would have PJ if the action were filed today.

Piper Aircraft Co. v. Reyno – An Illustrative Case & Forum Non Conveniens

• Facts: D’s aircraft crashed in Scotland, killing pilot and five Scottish passengers → P, as executor, wrongful death suits in CA state court → P sued Ds Piper and Hartzell → Ds removed the case to federal court → Piper moved to transfer to PA and Hartzell moved to dismiss for lack of PJ → Since venue was properly laid in CA, we don’t know which statute is the basis for Hartzell’s transfer (1404(a), 1406(a), or 1631) → Federal District court in CA concluded that it did not have jxn over Hartzell, and transferred Piper and Hartzell to PA. PA dismissed piper under forums non conveniens.

• Forum Non Conveniens: Piper tells us that a forum non conveniens dismissal is contingent on the availability of an adequate alternative forum. 

  • If there’s no adequate alternative forum, a federal district court cannot dismiss on grounds of forum non conveniens. 

  • If there is an adequate alternative forum available, a court must consider the following public and private interest factors listed:

    • Private Interests

      • Relative ease of access to sources of proof

      • Availability of compulsory process for attendance of unwilling witnesses

      • The cost of obtaining attendance of willing witnesses

      • Possibility and appropriateness of view of premises

      • All other practical problems that make trial of a case easy, expeditious, and expensive

    • Public Interests

      • Administrative difficulties flowing from court congestion

      • Local interest in having localized controversies tried at home

      • Interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action

      • The avoidance of unnecessary problems in conflicts of law

      • Application of foreign law

      • Unfairness of burdening citizens in an unrelated forum with jury duty

• Adequate alternative forum: A forum where D is:

  • Amenable to process, and

  • The remedy offer is not clearly unsatisfactory

Piper weakens the strong presumption in favor of P’s choice of forum when P is not an American citizen or resident.