holding that there was no personal jurisdiction based on the defendant’s product sales in Illinois where the plaintiff’s “claims center on a patent infringement lawsuit in Minnesota and alleged bid-rigging in states other than Illinois,” and thus had “nothing to do with [the defendant’s] six sales in … Illinois”
How later courts described this case
- holding that there was no personal jurisdiction based on the defendant’s product sales in Illinois where the plaintiff’s “claims center on a patent infringement lawsuit in Minnesota and alleged bid-rigging in states other than Illinois,” and thus had “nothing to do with [the defendant’s] six sales in … Illinois”
- holding that when a federal statute provides for nationwide service of process, “due process requires only that [a defendant] have sufficient minimum contacts with the United States as a whole to support personal jurisdiction”
- finding that granting motion to return documents to district court for sealing “is appropriate when they are not among ‘the materials that formed the basis of the parties’ dispute and the district court’s resolution.’”
- holding that venue and service provisions of the Clayton Act must be read together
Written by the judges who cited it.
The opinion
In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 12‐3406
KM ENTERPRISES, INC.,
Plaintiff‐Appellant,
v.
GLOBAL TRAFFIC TECHNOLOGIES, INC.
and GLOBAL TRAFFIC TECHNOLOGIES, LLC,
Defendants‐Appellees.
____________________
Appeal from the United States District Court
for the Southern District of Illinois.
No. 12‐CV‐257 — Michael J. Reagan, Judge.
____________________
ARGUED FEBRUARY 15, 2013 — DECIDED AUGUST 2, 2013
____________________
Before FLAUM, WOOD, and HAMILTON, Circuit Judges.
WOOD, Circuit Judge. KM Enterprises, Inc. (KME), an
Illinois corporation, sued Global Traffic Technologies, Inc.
and its subsidiary, Global Traffic Technologies, LLC
(collectively GTT), both Delaware entities headquartered in
Minnesota, in the Southern District of Illinois, alleging
violations of the Sherman and Clayton Acts and related state
laws. The district court dismissed the suit for improper
2 No. 12‐3406
venue, reasoning that GTT did not reside in the district and
that none of the events at issue in the suit took place there.
KME’s appeal of that dismissal raises a surprisingly com‐
plex question about the relation between general principles
of personal jurisdiction and venue and the special jurisdic‐
tion and venue provisions that appear in the Clayton Act.
For the reasons that follow, we affirm the judgment of the
district court.
I
KME and GTT are competitors in a specialized market
for devices that permit emergency vehicles to send a signal
that preempts ordinary traffic lights and thereby allows the
emergency vehicle to pass through an intersection with,
rather than against, the light. This speeds the progress of the
emergency vehicle and enhances safety for other vehicles.
There are at least two primary traffic‐signal‐interrupter
technologies, one that relies on optical signals and one that
uses GPS signals. GTT’s optical products carry the brand
name “Opticom.”
This case is but one of several ongoing legal disputes
between KME and GTT. In 2010, GTT filed a patent
infringement suit against KME in the District of Minnesota;
KME then filed a separate suit against GTT, also in the
District of Minnesota, which was consolidated with the
patent case. Next, KME sued the New York State
Department of Transportation and its commissioner twice in
2011 in the Eastern District of New York, challenging the
Department’s award of traffic‐preemption contracts to
vendors of GTT technology. KME followed with this suit in
the Southern District of Illinois in 2012. The present suit
No. 12‐3406 3
alleges that GTT violated federal antitrust laws by
improperly interfering with competitive bidding on public
contracts and engaging in monopolistic activity similar to
illegal tying.
KME alleges that GTT improperly persuades public
agencies to specify GTT’s Opticom technology when drafting
their public contract requirements, thus ensuring that such
contracts are awarded to bidders who will install GTT’s
units. But the plot thickens. KME further alleges that GTT
then falsely informs these agencies that the Opticom product
is no longer available and instead offers to supply a “dual”
unit that houses both optical and GPS technology. Apparent‐
ly the theory is that this is a type of bait‐and‐switch, or that
some other aspect of the arrangement has the effect of lock‐
ing the purchasers into GTT’s GPS technology and harming
competition in the GPS market. Notably, none of this illegal
tying activity took place in Illinois. Though there are several
dozen GTT‐equipped traffic intersections located in the
Southern District of Illinois (and some unspecified number
of additional intersections in the state as a whole), none is
equipped with the dual unit at the core of KME’s antitrust
allegations.
Shortly after the present suit was filed, GTT moved to
dismiss based on, among other things, improper venue.
Discovery and a hearing on the motion revealed that, other
than the GTT devices at the intersections in the district,
GTT’s presence in the Southern District of Illinois was
limited to six direct sales to buyers in the district over a four‐
year period, totaling $2,327.25, or .002% of GTT’s sales, and
two meetings between GTT and KME representatives in the
district during which GTT offered to purchase KME’s
4 No. 12‐3406
business. In addition, there are third‐party contractors who
bid on contracts in the district and install GTT’s equipment.
It was undisputed that GTT does not directly install or
maintain the equipment in the district, does not maintain
offices or agents in the district, and does not directly
promote its products in the district. The public procurement
process by which traffic‐signal‐interrupter contracts are
awarded takes place in Springfield, while the third‐party
distributor that supplies GTT’s products to the district is
located in Chicago. Based on these facts, the district court
granted GTT’s motion to dismiss on venue grounds,
reasoning that GTT’s contacts with the district could not
support venue under 28 U.S.C. § 1391.
KME appeals. It challenges the district court’s
determination that GTT’s contacts with the district are
insufficient to support venue under the general venue
statute, Section 1391, and it argues that venue is proper
under Section 12 of the Clayton Act, which provides special
rules for venue and service of process in antitrust actions
against corporations. 15 U.S.C. § 22. (We note that only one
of the GTT entities is a corporation (GTT, Inc.), and the other
is an LLC. By analogy to the union (an unincorporated
association) at issue in Denver & Rio Grande Western Railroad
v. Brotherhood of Railroad Trainmen, 387 U.S. 556 (1967), it
seems that venue for the LLC should be determined by the
residence of the entity itself rather than that of its individual
members. See id. at 559. Given the existence in this case of
the corporate defendant, however, we need not delve further
into that issue.) More importantly, KME advances a theory
that would allow it to short‐circuit the venue analysis by
mixing and matching among the service‐of‐process and
venue provisions of Section 12 and Section 1391. The latter
No. 12‐3406 5
theory is a controversial one that has divided our sister
circuits. Because our disposition of this appeal hinges on
whether we adopt it, we address it first.
II
The intersection between general principles of federal
personal jurisdiction and venue and the Clayton Act’s
specific provisions has become tangled over the years. It is
helpful, therefore, to begin with a review of the relevant
procedural principles and the language of the governing
statutes. “Personal jurisdiction” refers to the court’s power
over the parties. See Leroy v. Great W. United Corp., 443 U.S.
173, 180 (1979). That power derives ultimately from the state
(in the general sense of the term), the party’s contacts with
the state, and the reasonableness of the assertion of judicial
authority, but the mechanics for asserting personal
jurisdiction in federal court are found in Federal Rule of
Civil Procedure 4(k). Subpart (1)(A) of the rule provides that
“[s]erving a summons or filing a waiver of service
establishes personal jurisdiction over a defendant … who is
subject to the jurisdiction of a court of general jurisdiction in
the state where the district court is located.” This means, in
essence, that federal personal jurisdiction is proper
whenever the person would be amenable to suit under the
laws of the state in which the federal court sits (typically
under a state long‐arm statute), subject always to the
constitutional due process limitations encapsulated in the
familiar “minimum contacts” test. See Int’l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945); see also, e.g., Mobile
Anesthesiologists Chi., LLC v. Anesthesia Assocs. of Hous.
Metroplex, P.A., 623 F.3d 440, 443 (7th Cir. 2010). Subpart
(1)(C) provides that personal jurisdiction is proper if
6 No. 12‐3406
authorized by a federal statute, again subject to due process
limitations.
While personal jurisdiction governs a court’s power over
a defendant, federal venue rules determine in which judicial
district (among those that have the power to hear a given
suit) a suit should be heard. Leroy, 443 U.S. at 180. Unlike
personal jurisdiction, which has a constitutional dimension,
civil venue is a creature of statute, intended to limit the
potential districts where one may be called upon to defend
oneself in any given matter to those that are fair and
reasonably convenient. Id. The general federal venue statute,
28 U.S.C. § 1391, provides that venue in a civil case is proper
in:
(1) a judicial district in which any defendant resides,
if all defendants are residents of the State in which the
district is located;
(2) a judicial 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; or
(3) if there is no district in which an action may
otherwise be brought as provided in this section, any
judicial district in which any defendant is subject to
the court’s personal jurisdiction with respect to such
action.
28 U.S.C. § 1391(b). (Section 1391 was amended by the
Federal Courts Jurisdiction and Venue Act of 2011, Pub. L.
No. 112‐63. The Act eliminated a longstanding distinction
between venue in civil cases brought under federal question
jurisdiction and those brought under diversity jurisdiction
No. 12‐3406 7
and rearranged several subsections. While the Act’s
amendments, which became effective in January 2012, apply
to this case, they have no substantive effect on our analysis.
Because we apply the Act as amended, however, the
subsections to which we refer are numbered slightly
differently than they were when courts addressed this topic
previously.) The statute further provides that a corporate
defendant is deemed to “reside” “in any judicial district in
which such defendant is subject to the court’s personal
jurisdiction with respect to the civil action in question.”
§ 1391(c)(2). In states with multiple judicial districts,
subsection (d) limits the residency of a corporation to “any
district in that State within which its contacts would be
sufficient to subject it to personal jurisdiction if that district
were a separate State, and, if there is no such district … in
the district within which it has the most significant
contacts.”
These are the rules that govern in the general case. But, as
Rule 4(k)(1)(C) recognizes, in some instances Congress has
provided special federal rules for establishing personal
jurisdiction, venue, or both. The Clayton Act is one such
statute. Section 12 states:
Any suit, action, or proceeding under the antitrust
laws against a corporation may be brought not only in
the judicial district whereof it is an inhabitant, but
also in any district wherein it may be found or
transacts business; and all process in such cases may
be served in the district of which it is an inhabitant, or
wherever it may be found.
15 U.S.C. § 22. As we can see, Section 12 provides for both
personal jurisdiction and venue in the case of a corporate
8 No. 12‐3406
defendant. Its first clause sets venue anywhere the
corporation is an “inhabitant,” is “found,” or “transacts
business,” while the second clause provides for nationwide
(indeed, worldwide) service of process and therefore
nationwide personal jurisdiction. See, e.g., Carrier Corp. v.
Outokumpu Oyj, 673 F.3d 430, 449 (6th Cir. 2012); GTE New
Media Servs., Inc. v. BellSouth Corp., 199 F.3d 1343, 1350 (D.C.
Cir. 2000); see also Go‐Video, Inc. v. Akai Elec. Co., 885 F.2d
1406, 1413 (9th Cir. 1989) (worldwide service authorized
from standpoint of U.S. law).
The structure of Section 12 raises a question, however:
must its venue and service‐of‐process provisions be read as
an integrated whole? That is, if a plaintiff chooses to take
advantage of Section 12’s nationwide service‐of‐process
provision (and thus in effect rely on nationwide personal
jurisdiction), must she then establish venue under Section 12
as well, or may she mix and match, relying on the Clayton
Act for personal jurisdiction and Section 1391 for venue? The
answer is far from clear, and the confusion appears to stem
from the phrase “in such cases” in the second clause. Does
“such cases” refer to any antitrust suit against a corporation,
or only to those antitrust cases against corporations for
which the venue rules in Section 12 are satisfied? The
Supreme Court has yet to speak on the issue. While the
Court has held that special venue rules may, as a general
matter, be supplemented by the general venue provisions,
provided that the statute does not indicate a contrary
congressional intent, Pure Oil Co. v. Suarez, 384 U.S. 202, 204‐
05 (1966); see also Bd. of Cnty. Comm’rs v. Wilshire Oil Co., 523
F.2d 125, 130‐31 (10th Cir. 1975) (Section 12 contains no
contrary intent and may be supplemented), this tells us only
that Section 12 venue is not exclusive of Section 1391. It
No. 12‐3406 9
sheds no light on whether Section 12 itself is a package deal
or an à la carte menu.
Before delving into the competing views on whether the
clauses of Section 12 are or are not linked, we should explain
why the answer matters. If the clauses are read together,
then there exist some limits on where a corporate antitrust
defendant may be sued. Though personal jurisdiction is
appropriate everywhere under that statute, venue is proper
only in the district(s) the corporation inhabits, is found, or
transacts business. A corporation inhabits the district in
which it is incorporated. See, e.g., In re Auto. Refinishing Paint
Antitrust Litig., 358 F.3d 288, 293 n.6 (3d Cir. 2004). Being
found and transacting business both refer to a corporation’s
activities in the district, with the latter concept interpreted
more expansively than the former. Id. Section 12 is not a
restrictive venue provision. Indeed, for much of its history, it
has been more generous than the general venue statute, at
least in the case of out‐of‐state domestic corporations, see
Gen. Elec. Co. v. Bucyrus‐Erie Co., 550 F. Supp. 1037, 1041
(S.D.N.Y. 1982), but it falls well short of providing universal
venue in every judicial district in the United States.
The same cannot be said if we decouple Section 12’s
clauses and enable a plaintiff to combine nationwide service
of process with Section 1391. As noted above, Section
1391(b)(1) states that venue is proper in any district where
the defendant “resides” (provided all defendants reside in
the same state), while subsection (c)(2) provides that a
corporation resides in any district in which it is subject to
personal jurisdiction. But if the plaintiff relies on the Clayton
Act’s nationwide service of process to secure personal
jurisdiction, then for purposes of Section 1391 the corporate
10 No. 12‐3406
defendant would “reside” in every judicial district in the
country and venue would be proper everywhere. Although
Section 1391(c)(2) places some restrictions on venue in the
typical case (since most corporations are not subject to
personal jurisdiction everywhere in the United States), the
result of combining it with Section 12 is that it imposes no
limits whatsoever in an antitrust suit. (As a brief aside, the
result is similar in the case of alien corporations. Section
1391(c)(3) provides that in a suit against an alien, venue is
proper in any district. Thus, if a plaintiff could combine
Section 12 service of process with Section 1391 venue, it
could drag an alien into court anywhere in the United States.
See, e.g., 14D CHARLES ALAN WRIGHT ET AL., FEDERAL
PRACTICE & PROCEDURE § 3818 (3d ed. 2013) [hereinafter
WRIGHT & MILLER].)
The effect of combining Section 12 service of process with
Section 1391 venue is more complicated when a plaintiff
sues in a state, such as Illinois, that has more than one
judicial district. In those cases, Section 1391(d) directs the
court to choose among the districts in the state by looking to
whether the corporate defendant’s contacts with the district
would subject it to personal jurisdiction if the district were a
single state. What are we to make of this instruction?
According to one understanding, we could interpret this
language to require that a court perform the standard
minimum contacts analysis used for personal jurisdiction for
purposes of setting venue, even though that analysis was not
required to establish personal jurisdiction at the state level in
the first place. Another possibility (albeit one that has the
flaw of making some words in the statute superfluous) is to
ignore the suggestion in subsection (d)’s reference to
“contacts” and find that since the Clayton Act subjects a
No. 12‐3406 11
corporate defendant to personal jurisdiction throughout the
United States, that defendant would be subject to personal
jurisdiction in every district even treating districts as states.
Yet another possibility, suggested by some commentators, is
that subsection (d)’s reference to “contacts” in the case of
multi‐district states (which, before the 2011 amendment,
appeared alongside the general corporate venue provision in
subsection (c)) indicates that when Congress used the term
“personal jurisdiction” in the general venue statute, it was
thinking only of personal jurisdiction established through
the traditional analysis of state long‐arm statutes, not of
jurisdiction obtained through special federal statutory
provisions. See WRIGHT & MILLER § 3818; Rachel M. Janutis,
Pulling Venue Up by Its Own Bootstraps: The Relationship
Among Nationwide Service of Process, Personal Jurisdiction, & §
1391(c), 78 ST. JOHN’S L. REV. 37, 38 (2004). Finally, we could
read the additional complication introduced by subsection
(d) as a signal not to decouple the clauses of Section 12 in the
first place.
III
Our sister circuits are split over how to read Section 12.
Scholarly opinion is similarly divided. See WRIGHT & MILLER
§ 3818 (opining that the text of Section 12 indicates that the
clauses should be read independently, but acknowledging
that this creates odd results); Herbert Hovenkamp, Personal
Jurisdiction & Venue in Private Antitrust Actions in the Federal
Courts: A Policy Analysis, 67 IOWA L. REV. 485 (1982) (Section
12 best read as an integrated whole); Janutis, 78 ST. JOHN’S L.
REV. 37 (reading Section 1391(c) to require a traditional per‐
sonal jurisdiction analysis and not permitting reliance on
Section 12’s service‐of‐process provision); Jordan G. Lee,
12 No. 12‐3406
Note, Section 12 of the Clayton Act: When Can Worldwide Ser‐
vice of Process Allow Suit in Any District?, 56 FLA. L. REV. 673
(2004) (arguing for allowing Section 12 personal jurisdiction
to be combined with general venue); Adam B. Perry, Note,
Which Cases Are “Such Cases”: Interpreting & Applying Section
12 of the Clayton Act, 76 FORDHAM L. REV. 1177 (2007) (favor‐
ing a “hybrid” view).
The Third and Ninth Circuits hold that the Section’s
clauses may be decoupled, taking what might be termed the
“independent” view of Section 12. The leading opinion on
this side of the split is Go‐Video from the Ninth Circuit. In
that case, which involved a foreign corporation, the Ninth
Circuit started from the premise that the plain text of Section
12 could not resolve the issue. 885 F.2d at 1408. Turning to
other interpretive guides, the court found that “the manner
in which courts have traditionally defined the relationship
between one statute’s specific venue provision and the
general federal venue statutes,” the legislative history and
purpose of the Clayton Act, and precedent each pointed to
the conclusion that Section 12’s clauses need not be read as
linked. Id.
The Ninth Circuit observed that Pure Oil and later cases
instruct that special venue statutes generally supplement,
rather than supplant, the general venue rules provided by
Section 1391. Id. at 1409‐10. The court took the position that
this presumption of supplementation was in tension with
the “integrated” view of Section 12, because, in its view,
reading the clauses together renders Section 12 venue at least
partially exclusive. Id. at 1408‐09. Second, after reviewing
Section 12’s scant legislative history, the Ninth Circuit
concluded that it provided no support for an integrated
No. 12‐3406 13
reading of Section 12 and that, if anything, the fact that the
service‐of‐process clause was appended to the venue
provision only after the bill reached the Senate weakly
suggested that Congress viewed the provisions as separate.
Id. at 1410. The Ninth Circuit further noted that its reading of
Section 12 was in keeping with the Clayton Act’s general aim
of expanding venue in antitrust actions, insofar as its view
permitted venue in more districts than did the integrated
view (indeed, it eliminated all limitations). Id. at 1410‐11.
Finally, the Ninth Circuit noted that of the handful of lower
courts to confront the question, most had (as of that time)
adopted the view that decoupling was permissible. Id. at
1411‐12 (citing cases).
The Ninth Circuit acknowledged that decoupling the
clauses of Section 12 potentially rendered Section 12’s venue
provision “wholly redundant,” but it concluded that its view
was nevertheless the preferable one. Id. at 1413. The Ninth
Circuit later extended the holding in Go‐Video to a suit
against a domestic corporation in Action Embroidery Corp. v.
Atlantic Embroidery, Inc., 368 F.3d 1174, 1177‐80 (9th Cir.
2004). Persuaded by the reasoning of Go‐Video, the Third
Circuit also takes the position that a plaintiff may rely on
nationwide service of process under Section 12 without also
satisfying Section 12’s venue provision, at least in the case of
an alien corporation. Auto. Refinishing Paint, 358 F.3d at 296.
(At least one district court in the Third Circuit has
interpreted Automotive Refinishing Paint to apply exclusively
in cases against alien corporations. See Cumberland Truck
Equip. Co. v. Detroit Diesel Corp., 401 F. Supp. 2d 415, 420‐21
(E.D. Pa. 2005).)
14 No. 12‐3406
On the other side of the split, the D.C. and Second
Circuits have adopted the integrated view of Section 12. In
GTE New Media, the D.C. Circuit based its reading of Section
12 on the statute’s asserted “plain” language. 199 F.3d at
1350. In the D.C. Circuit’s view, the term “in such cases”
must refer back to the entire clause preceding the semicolon;
to read the statute otherwise is effectively to “jettison the
first clause” (a point with which the Ninth Circuit does not
necessarily disagree). Id. at 1351. The court added: “it seems
quite unreasonable to presume that Congress would
intentionally craft a two‐pronged provision with a
superfluous first clause, ostensibly link the two provisions
with the ‘in such cases’ language, but nonetheless fail to
indicate clearly anywhere that it intended the first clause to
be disposable.” Id.
The Second Circuit also grounds its reading of Section 12
in the language of the statute. See Daniel v. Am. Bd. of
Emergency Med., 428 F.3d 408, 424 (2d Cir. 2005). The court
reasoned that the common meaning of “such” is “having a
quality already or just specified,” or “previously
characterized or described: aforementioned,” and that the
quality of the cases “just specified” in Section 12 is those that
meet the venue provisions listed in the first clause, not
antitrust cases against corporations in general. Id. (internal
quotation marks omitted).
Having declared the meaning of Section 12 plain, the
Second Circuit could have stopped there, as the D.C. Circuit
did in GTE New Media. The court in Daniel went on, however,
to list several additional factors supporting its view. Unlike
the Ninth Circuit, the Second Circuit saw little in the
legislative history to support the decoupling of Section 12’s
No. 12‐3406 15
two clauses. Id. at 425‐26. It also pointed out that the
Supreme Court has observed that “[i]n adopting § 12
Congress was not willing to give plaintiffs free rein to haul
defendants hither and yon at their caprice,” United States v.
Nat’l City Lines, 334 U.S. 573, 588 (1948)—something that
decoupling would surely allow. Daniel, 428 F.3d at 425.
While the Second Circuit acknowledged that Congress
intended to expand venue in enacting Section 12, it
disagreed with the Ninth Circuit that this implied extending
venue to the entirety of the United States. Id. at 425‐26. In
1914, when the Clayton Act was enacted, the general venue
provision was very narrow, as was the specific antitrust
venue provision in the Sherman Act. Section 12 expands
venue beyond either of those venue provisions as they
existed at the time, and thus reading the section as a whole
does not contradict Congress’s intent in enacting Section 12.
Id.
Finally, the Second Circuit saw little value in drawing
analogies between Section 12 and other statutes containing
special venue and service‐of‐process provisions, such as the
Securities Exchange Act of 1934, 15 U.S.C. § 78aa (Exchange
Act), or the Racketeer Influenced and Corrupt Organizations
Act, 18 U.S.C. § 1965 (RICO). For one thing, the Supreme
Court has cautioned that “analysis of special venue
provisions must be specific to the statute.” Cortez Byrd Chips,
Inc. v. Bill Harbert Constr. Co., 529 U.S. 193, 204 (2000). More
importantly, the structure and wording of statutes such as
the Exchange Act or RICO are different from that of Section
12. Daniel, 428 F.3d at 426. RICO, for instance, separates its
venue and service‐of‐process provisions into distinct, non‐
sequential lettered subdivisions. Id. Indeed, given that the
Clayton Act was apparently the model for RICO, the court in
16 No. 12‐3406
Daniel reasoned that, if anything, the different wording and
structure of RICO’s venue and service‐of‐process provisions
reinforced the conclusion that the clauses in Section 12 are
linked. Id. at 427.
So that is where the circuit split stands. This case calls on
our court to enter the fray. While we acknowledge that this
question does not admit of a clear or easy resolution, for the
reasons that follow we join the Second and D.C. Circuits in
holding that Section 12’s venue and service‐of‐process
provisions must be read together.
IV
In matters of statutory interpretation, we begin with the
text. As the Supreme Court has instructed time and again, if
“the language at issue has a plain and unambiguous
meaning with regard to the particular dispute in the case,”
then that meaning controls and the court’s “inquiry must
cease.” Robinson v. Shell Oil Co., 519 U.S. 337, 340 (1997); see
also Conn. Nat’l Bank v. Germain, 503 U.S. 249, 253‐54 (1992);
United States v. Ron Pair Enters., Inc., 489 U.S. 235, 240‐41
(1989). The Second and D.C. Circuits each took the position
that the text alone conclusively established that the two
clauses of Section 12 are linked together, reasoning that the
phrase “in such cases” could refer only to cases where venue
was proper under the first clause. See Daniel, 428 F.3d at 424;
GTE New Media, 199 F.3d at 1350. We are less confident that
the text alone drives this result.
Though we agree with the Second Circuit that “such”
means “’having a quality already or just specified’; ‘of this or
that character, quality, or extent: of the sort or degree
previously indicated or implied’; or ‘previously
No. 12‐3406 17
characterized or described: aforementioned,’” Daniel, 428
F.3d at 424 (quoting WEBSTER’S THIRD NEW INTERNATIONAL
DICTIONARY (UNABRIDGED) 2283 (1986)), the question
remains: what is the “quality” of the cases specified in the
first clause? A thing’s “quality” includes its particular
characteristics, typically signaled by adjectives, and so we
can be confident that “such cases” must, at a minimum, refer
to antitrust cases brought against corporations. But the
venue provision in clause one of Section 12 is not phrased in
adjectival terms. Rather, the clause speaks of antitrust cases
against corporations and provides that they “may be
brought” in certain districts; it does not speak of antitrust
cases against corporations that “are brought” in those
districts. Given that Section 12’s venue provision is not
plainly structured as a characteristic of the cases described, it
is not apparent that these provisions specify the “quality” of
the cases referred to in clause two. See WRIGHT & MILLER §
3818 (“The [Second Circuit’s] conclusion rests on the
assumption that ‘such cases’ refers to antitrust cases against
corporations that are brought in the approved venues, but
that is not a possible referent of ‘such cases’ because those
words nowhere appear in the clause preceding the semi‐
colon.”) (emphasis in original).
The difficulties posed by the Second and D.C. Circuits’
reading of the text do not, however, convince us that the
contrary reading is correct. Reading the two clauses of
Section 12 independently creates textual problems of its
own. If the clauses are not linked, then the venue language is
superfluous. Interpretations that render words of a statute
superfluous are disfavored as a general matter, e.g., Astoria
Fed’l Sav. & Loan Ass’n v. Solimino, 501 U.S. 104, 112 (1991),
and this principle has even greater force in a context such as
18 No. 12‐3406
this, where, in order to decouple Section 12’s venue and
service‐of‐process provisions, we would have to assume that
Congress intentionally joined the two provisions with a
semicolon, but nevertheless intended for the second
provision to render the first “disposable,” GTE New Media,
199 F.3d at 1351. Accord Go‐Video, 885 F.2d at 1413
(recognizing that this interpretation of Section 12 had the
potential to render the venue provision “wholly
redundant”).
Even setting aside problems of surplusage, the
independent reading of Section 12 leads to some very odd
results. Cf. Griffin v. Oceanic Contractors, Inc., 458 U.S. 564,
575 (1982) (“[I]nterpretations of a statute which would
produce absurd results are to be avoided if alternative
interpretations consistent with the legislative purpose are
available.”). As noted earlier, allowing antitrust plaintiffs to
mix and match Section 12’s service‐of‐process provision with
Section 1391’s general venue provision renders the venue
inquiry meaningless, since venue is satisfied in every federal
judicial district under subsection (c)(2). This runs contrary to
Congress’s apparent intent in passing Sections 12 and 1391
that there be some limits on venue, in antitrust cases
specifically and in general. Both statutes authorize venue
only when certain enumerated requirements are met, be it
that the defendant “transacts business” in the district,
“resides” there, or something else. It would be quite strange
to read two statutes that place limits on venue in a manner
that eliminates those limits.
Then there is the matter of Section 1391(d). If we were to
adopt the de‐linked view of Section 12 and allow it to be
combined with general corporate venue, we run into the fact
No. 12‐3406 19
that subsection (d) injects a minimum‐contacts test that
would otherwise be absent into the venue analysis, but only
in cases brought in states with multiple judicial districts. As
discussed above, there are various ways to deal with sub‐
section (d), but the most sensible one is to view it as yet
another signal that the clauses of Section 12 should be read
as an integrated whole. If a plaintiff cannot pair Section 12
service of process with Section 1391 venue, then the plaintiff
will have to show that the defendant has sufficient minimum
contacts with the forum under both subsections (c)(2) and
(d). This eliminates the possibility of selectively
reintroducing the minimum‐contacts analysis based on the
happenstance of whether the state has multiple judicial
districts.
If something in Section 12 compelled the mix‐and‐match
approach, then that is what we would follow. But we see
nothing in the text, purpose, or history of Section 12 that
casts doubt on the result we have reached. We are not
persuaded to the contrary by the Ninth Circuit’s reasoning in
Go‐Video. Although it is true that courts generally read
special venue statutes as supplementing, rather than
supplanting, general venue, Go‐Video, 885 F.2d at 1409, that
principle is beside the point. No plaintiff is required to use
Section 12 if she finds it preferable to use Section 1391 and
the general state long‐arm statute (or some other source of
personal jurisdiction and service). See Daniel, 428 F.3d at 427.
Section 12 provides an additional option, but one that
requires use of the service and venue rules as a package.
Second, the fact that Congress passed Section 12 with the
intent to expand venue in antitrust cases does not indicate
that Congress wanted nationwide venue. Congress said no
20 No. 12‐3406
such thing in Section 12. To the contrary, it created specific
limits on venue—limits that for many corporations would
result in a set of permissible districts much smaller than the
entire United States. Nat’l City Lines, 334 U.S. at 588 (“In
adopting § 12 Congress was not willing to give plaintiffs free
rein to haul defendants hither and yon at their caprice.”).
Section 12 venue is broader than venue under either the
Sherman Act or the general venue statute as it existed in
1914, and we think that this is all that Congress intended.
Finally, we agree with the Second Circuit that Section 12’s
sparse legislative history is, at best, inconclusive and an
insufficient basis for overlooking the confusing and strange
implications of decoupling the clauses. Daniel, 428 F.3d at
425‐26.
In sum, while we find the language of Section 12 too
ambiguous to rely on the “plain meaning” rationale
endorsed by the Second and D.C. Circuits, the practical
effects of decoupling the clauses of Section 12 are ultimately
too bizarre and contrary to Congress’s apparent intent for us
to endorse. Thus, we hold that Section 12 must be read as a
package deal. To avail oneself of the privilege of nationwide
service of process, a plaintiff must satisfy the venue
provisions of Section 12’s first clause. If she wishes to
establish venue exclusively through Section 1391, she must
establish personal jurisdiction some other way.
V
We may now turn at last to the case before us. First, we
consider whether personal jurisdiction and venue are
satisfied under Section 12. Personal jurisdiction is easy: due
process requires only that GTT have sufficient minimum
contacts with the United States as a whole to support
No. 12‐3406 21
personal jurisdiction, and Congress has provided for
nationwide service of process. See Action Embroidery, 368
F.3d at 1180. As a domestic corporation, GTT has sufficient
minimum contacts with the United States to satisfy due
process, and there is nothing unreasonable about requiring
the company to submit itself to the authority of the federal
courts.
Venue under Section 12 is another matter. Although the
section provides for venue in any district where a defendant
is an inhabitant, is found, or transacts business, only the last
and most expansive of these tests is relevant here. See United
States v. Scophony Corp. of Am., 333 U.S. 795, 807 (1948)
(“transacts business” is a broader concept than being
“found”). The Supreme Court interprets the phrase
“transacts business” as “the practical, everyday business or
commercial concept of doing business or carrying on
business of any substantial character.” Id. (internal quotation
marks omitted); see also Tiger Trash v. Browning‐Ferris Indus.,
Inc., 560 F.2d 818, 824 (7th Cir. 1977). In the case of a
defendant that manufactures and sells goods, such as GTT,
the Court has found that a defendant transacted business for
purposes of Section 12 in a district when it promoted its
goods through product demonstrations, solicited orders
through salespersons located in the district, and shipped its
products to the district. Eastman Kodak Co. v. S. Photo
Materials Co., 273 U.S. 359, 374 (1927). Lower courts have also
found that a defendant was transacting business in a district
when the defendant maintained offices and provided
customer assistance in the district, Banana Distribs., Inc. v.
United Fruit Co., 269 F.2d 790, 794 & n.8 (2d Cir. 1959); when
it made substantial purchases in the district, Black v. Acme
Mkts., Inc., 564 F.2d 681, 687 (5th Cir. 1977); and when it
22 No. 12‐3406
exercised extensive control over a subsidiary or distributor
that transacted business in the district, Chrysler Corp. v. Gen.
Motors Corp., 589 F. Supp. 1182, 1200 (D.D.C. 1984); Grappone,
Inc. v. Subaru of Am., Inc., 403 F. Supp. 123, 130‐31 (D.N.H.
1975).
GTT’s activities in the Southern District of Illinois fall so
far short of those examples that they must be characterized
as de minimis for purposes of the transacting‐business
inquiry. Approximately 71 GTT traffic signal interrupters are
installed at various intersections throughout the district,
which covers approximately 16,500 square miles. See Illinois
Counties Ranked by Area, ILL. STATE GEOLOGICAL SURVEY,
http://isgs.illinois.edu/education/hi‐low/arearank.shtml (last
visited August 1, 2013); see also 28 U.S.C. § 93(c) (Illinois
counties within Southern District of Illinois). Without
knowing how many intersections there are in the Southern
District of Illinois, or how many intersections are or might be
eligible to be installed with traffic signal interrupters, we
cannot say what percentage this represents, but 71 traffic
intersections is a drop in the bucket. The fact that GTT’s
technology is being used in a few places within the district
does not demonstrate that it transacts business there. With
minor exceptions, GTT did not make sales in the district (the
technology is selected through a public procurement process
that occurred in Springfield, which is located in the Central
District of Illinois, 28 U.S.C. § 93(b)) nor did GTT install the
units that made their way to the district. GTT did make six
direct sales to locations in the district over a four‐year
period, for a grand total of $2,327.25, or .002% of GTT’s total
sales in this period. While sales volume is not dispositive in
a Section 12 venue analysis, see, e.g., Green v. U.S. Chewing
Gum Mfg. Co., 224 F.2d 369, 372 (5th Cir. 1955); ABC Great
No. 12‐3406 23
States, Inc. v. Globe Ticket Co., 310 F. Supp. 739, 742 (N.D. Ill.
1970), GTT’s negligible sales in the district provide only the
weakest support for venue.
Beyond the presence of GTT technology and minimal in‐
district sales, the district court found, and KME does not
dispute, that GTT has no offices or employees in the district,
that GTT equipment (apart from its direct sales) is purchased
from and installed by third‐party distributors whom GTT
does not control, and that GTT does not send agents into the
district for purposes of maintaining the equipment or
providing other customer service. GTT does not “do[] busi‐
ness or carry[] on business of any substantial character,”
Scophony, 333 U.S. at 807, in the district, and venue is not
proper under Section 12.
Before deciding that venue is lacking, we should also ask
whether Section 1391 can be satisfied. This option is
available only if KME can establish that personal jurisdiction
in the state of Illinois is proper under Illinois’s long‐arm
statute. We need not engage in that analysis, however,
because we conclude that venue is improper even if personal
jurisdiction is present. We look first to Section 1391(b)(1),
which provides for venue in the district in which the
defendants reside. As explained earlier, in cases brought in
states with multiple judicial districts (such as Illinois), a
corporation resides in any district in which it would be
subject to personal jurisdiction were that district a state. 28
U.S.C. § 1391(c)(2) & (d). Thus, for purposes of evaluating
venue, we must consider whether GTT would be subject to
personal jurisdiction in the Southern District of Illinois.
Illinois’s long‐arm statute permits its courts to exercise
personal jurisdiction to the fullest extent allowed by the
24 No. 12‐3406
Illinois and U.S. Constitutions. 735 ILCS § 5/2‐209(c). Under
the Illinois Constitution, personal jurisdiction is proper
“only when it is fair, just, and reasonable to require a
nonresident defendant to defend an action in Illinois,
considering the quality and nature of the defendant’s acts
which occur in Illinois or which affect interests located in
Illinois.” RAR, Inc. v. Turner Diesel, Ltd., 107 F.3d 1272, 1276
(7th Cir. 1997) (quoting Rollins v. Ellwood, 565 N.E.2d 1302,
1316 (Ill. 1990)). The U.S. Constitution requires that GTT
have “certain minimum contacts with [the forum] such that
the maintenance of the suit does not offend traditional
notions of fair play and substantial justice.” Int’l Shoe, 326
U.S. at 316 (internal quotation marks omitted). These tests
are not necessarily co‐extensive, but to the extent they
diverge, the Illinois constitutional standard is likely more
restrictive than its federal counterpart. See Rollins, 565
N.E.2d at 1316 (“The Illinois Constitution contains its own
guarantee of due process to all persons (Ill. Const. 1970, art.
I, § 2), a guarantee which stands separate and independent
from the Federal guarantee of due process … . [T]he final
conclusions on how the due process guarantee of the Illinois
Constitution should be construed are for [the Illinois
Supreme Court] to draw.”). If GTT may not be subjected to
personal jurisdiction in the Southern District of Illinois
under federal constitutional standards, then we need not
worry whether jurisdiction is also proper under the Illinois
Constitution.
Turning to federal due process requirements, personal
jurisdiction may be either general or specific. See, e.g.,
Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct.
2846, 2853‐54 (2011). Specific jurisdiction requires that the
plaintiff’s cause of action relate to the defendant’s contacts
No. 12‐3406 25
with the forum, id. at 2853, and it is plainly inapplicable
here. KME’s claims center on a patent infringement lawsuit
in Minnesota and alleged bid‐rigging in states other than
Illinois. They have nothing to do with GTT’s six sales in
southern Illinois, nor do they relate to the GTT technology
that has been installed within the district. Indeed, the
technology at the center of KME and GTT’s ongoing, multi‐
front legal battle—the dual optical‐GPS interrupter unit—is
not even present in the district.
General jurisdiction is similarly a nonstarter. It requires
“continuous and systematic general business contacts” with
the forum, Helicopteros Nacionales de Colom., S.A. v. Hall, 466
U.S. 408, 416 (1984), such that the defendant is “essentially at
home” there, Goodyear, 131 S. Ct. at 2851. See also Abelesz v.
OTP Bank, 692 F.3d 638, 654 (7th Cir. 2012) (pointing out that
this standard is difficult to meet). GTT’s minimal contacts
with the Southern District of Illinois, described above, fall
well short of the sort of systematic and continuous presence
that would suffice for general personal jurisdiction.
Accordingly, we conclude that there is no personal
jurisdiction over GTT in the Southern District of Illinois, and
thus venue is not proper under subsections (c)(2) and (d) of
Section 1391. (We note that KME has failed to show, in the
alternative, that venue is proper under Section 1391(b)(3).
This fallback provision applies only when venue is not
otherwise proper in any district, and KME does not suggest
that there is no other venue in which this suit may be
brought.)
As a last resort, KME argues that venue in the Southern
District is proper based on a theory of waiver. It contends
(correctly, though the district court did not acknowledge it)
26 No. 12‐3406
that GTT, LLC conceded that it was subject to personal juris‐
diction in the state of Illinois. In KME’s view, this concession
provides a basis for venue as to the LLC; it then argues that
GTT, Inc. is also subject to jurisdiction and venue in the dis‐
trict because of its parent‐subsidiary relationship with the
LLC.
There are two difficulties with this theory. First, while the
LLC conceded personal jurisdiction with respect to Illinois
as a whole, it actively contested venue in the Southern
District, arguing that while its contacts with the state
supported the exercise of jurisdiction, its contacts with the
district were too minimal to support venue under Section
1391(d). We see nothing inconsistent in this approach.
Section 1391(d) requires analysis of a defendant’s contacts
with the specific district; if these are insufficient, then venue
is not proper, regardless of the defendant’s contacts
elsewhere in the state. By conceding personal jurisdiction as
to the state, the LLC did not automatically waive its
objections to venue in the Southern District.
Second, even if we were to conclude that the LLC had
waived venue, we would not trace this waiver to GTT, Inc.
The activities of a subsidiary may suffice to assert
jurisdiction over the parent if there is some basis for piercing
the corporate veil, such as the parent’s unusual degree of
control over the subsidiary, but this does not apply in the
case of an ordinary parent‐subsidiary relationship that
observes corporate formalities. See Cent. States, Se. & Sw.
Areas Pension Fund v. Reimer Express World Corp., 230 F.3d
934, 943 (7th Cir. 2000); see also Tiger Trash, 560 F.2d at 823
(acknowledging that the parent’s control of its subsidiary
must be more extensive than the typical parent‐subsidiary
No. 12‐3406 27
relationship to support the exercise of venue over the parent
based on the activities of the subsidiary). Here, nothing
about the relationship between GTT, Inc. and GTT, LLC
suggests an abnormal level of involvement or control by the
parent that would allow us to exercise jurisdiction over the
parent solely on the basis of the activities of its subsidiary.
Venue is not proper under either Section 12 or Section
1391, and the district court therefore properly dismissed the
suit. Because we affirm on venue grounds, we need not
address GTT’s multiple alternative arguments supporting
the district court’s judgment.
VI
Before concluding, we must address GTT’s outstanding
motion to seal or return to the district court several
documents in the appellate record. Specifically, GTT asks us
to seal district court document 65, which is an unredacted
version of KME’s response to GTT’s motion to dismiss that
contains customer and pricing data. It also asks us to return
district court documents 75, 75‐6, and 75‐9 to the district
court. Document 75 is KME’s unredacted response to an
order to show cause why it should not be held in contempt
for violating the district court’s previous orders to keep
documents under seal, and it contains customer and pricing
information similar to that in document 65. Document 75‐6 is
an exact copy of another document that this court has
already ordered sealed, and document 75‐9 contains
additional pricing information. GTT asks that the documents
be sealed or returned to protect sensitive, confidential
pricing and customer information. GTT additionally points
out that document 75 and its exhibits relate exclusively to
28 No. 12‐3406
the pending contempt proceedings against KME and thus
are unnecessary to our resolution of this appeal.
This court does not look favorably on indiscriminate,
reflexive motions to seal the appellate record, but narrow,
specific requests will be granted when based on articulated,
reasonable concerns for confidentiality. See Baxter Int’l, Inc. v.
Abbott Labs., 297 F.3d 544, 546‐47 (7th Cir. 2002). Further,
returning documents to the district court is appropriate
when they are not among “the materials that formed the
basis of the parties’ dispute and the district court’s
resolution.” Id. at 547. GTT’s request is narrow, specific, and
justified, and we will therefore grant the motion in full.
In summary, we AFFIRM the district court’s dismissal for
improper venue, and we GRANT GTT’s motion to seal
document 65 and to return documents 75, 75‐6, and 75‐9 to
the district court.