Scott Gerber v. James Riordan

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

File Name: 11a0225p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

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SCOTT D. GERBER,

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Plaintiff-Appellant,

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No. 09-3790

v.

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JAMES C. RIORDAN and SEVEN LOCKS PRESS

Defendants-Appellees. -

CORP.,

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Appeal from the United States District Court

for the Northern District of Ohio at Toledo.

No. 06-01525—James G. Carr, District Judge.

Decided and Filed: August 18, 2011

Before: DAUGHTREY, MOORE, and CLAY, Circuit Judges.

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COUNSEL

ON BRIEF: Timothy G. Pepper, TAFT STETTINIUS & HOLLISTER LLP, Dayton,

Ohio, for Appellant.

CLAY, J., delivered the opinion of the court, in which DAUGHTREY, J., joined.

MOORE, J. (pp. 11-19), delivered a separate concurring opinion.

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OPINION

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CLAY, Circuit Judge. Plaintiff Scott Gerber filed this diversity of citizenship

action pursuant to 28 U.S.C. § § 1291 and 1332 against Defendants James Riordan and

Seven Locks Press Corp., alleging breach of contract and common law tort causes of

action. The court below dismissed the action for lack of personal jurisdiction over

Defendants. Plaintiff now appeals.

1

No. 09-3790 Gerber v. Riordan, et al. Page 2

For the reasons stated below, we REVERSE the decision of the court below, and

REMAND the case for further proceedings.

STATEMENT OF FACTS

I. Factual Background

This case arises out of a lawsuit filed by Plaintiff Scott Gerber (“Plaintiff”)

against Defendants James Riordan (“Riordan”) and Seven Locks Press Corp. (“Seven

Locks Press,” collectively “Defendants”), alleging breach of contract and common law

tort causes of action.

Plaintiff is a faculty member at Ohio Northern University’s Claude W. Pettit

College of Law, and an Ohio resident. However, in contracting with Defendants for

publication of his manuscript, Plaintiff listed his address as “4302 Chesapeake Avenue,

Hampton, Virginia, 23669.” (R. 6-1 at 1.) Defendant Seven Locks Press is a

corporation incorporated under Nevada law, doing business in California. Seven Locks

Press’ address is listed as “3100 W. Warner Avenue #8, Santa Ana, California 92704.”

(Id.)

In June 2005, Plaintiff and Defendant Seven Locks Press entered into a contract

(the “contract”) to publish Plaintiff’s manuscript. Defendant Riordan, publisher of

Seven Locks Press, acted as Seven Locks Press’ agent in negotiating and entering into

the contract with Plaintiff. The contract initially required publication of Plaintiff’s

manuscript within 120 days of the date of the contract, (id. at 3), which Plaintiff alleges

in his complaint was “on or about October 10, 2005.” (R. 6, Am. Compl. at 3.) The

contract also required Plaintiff to pay Seven Locks Press a publication subsidy of

$11,500.00. (Id.) Plaintiff alleges that he paid Seven Locks Press the agreed upon

subsidy in November 2005. (Id.)

In November 2005, the parties amended the contract, and delayed the publication

date to early February 2006. Plaintiff alleges that even after publication was delayed,

Defendants failed to publish Plaintiff’s manuscript in a timely fashion.

No. 09-3790 Gerber v. Riordan, et al. Page 3

II. Procedural History

Plaintiff filed the instant action against Defendants on June 20, 2006 in the

United States District Court for the Northern District of Ohio based on the parties’

diversity of citizenship, and an amount in controversy exceeding $75,000.00. See

28 U.S.C. §§ 1291 and 1332. In his amended complaint, Plaintiff seeks relief for

Defendants’ breach of contract; interference with a contract and prospective advantage;

defamation; intentional or reckless infliction of emotional distress; negligent infliction

of emotional distress; misrepresentation; and fraud. After filing his complaint, but prior

to receiving any responsive pleading from Defendants, Plaintiff filed an amended

complaint; a motion to stay litigation in favor of mediation in Toledo, Ohio; and an

application to the court for entry of default judgment against Defendants. Proceeding

pro se, Defendants filed a motion to dismiss the amended complaint for lack of personal

jurisdiction.

After directing Defendants to show cause why default judgment should not be

entered against them for failure to secure an attorney to represent corporate Defendant

Seven Locks Press as required by 28 U.S.C. § 1654, see also Bristol Petroleum Corp.

v. Harris, 901 F.2d 165, 166 n.1 (D.C. Cir. 1990) (“a corporation . . . [may] not appear

pro se”), the district court entered a default judgment against Defendants on October 16,

2006.

Subsequently, Defendants retained an attorney who entered a general appearance

with the district court on Defendants’ behalf. Through their attorney, Defendants made

motions to stay the litigation pending arbitration, and to vacate the default judgment

entered against them. The district court granted both of Defendants’ motions on

December 8, 2006. Defendants also filed an opposition to Plaintiff’s motion for

mediation in Toledo, Ohio.

The parties appeared at a case management conference with the district court on

June 19, 2007. On June 21, 2007, the district court ordered that discovery in the case be

completed by January 31, 2008; dispositive motions submitted by November 11, 2007;

opposition to dispositive motions submitted by November 30, 2007; and replies

No. 09-3790 Gerber v. Riordan, et al. Page 4

submitted by December 15, 2007. The parties also consented to the magistrate judge’s

jurisdiction for all purposes, including the entry of judgment. This case was

subsequently reassigned from the district judge to a magistrate judge. The court

scheduled a settlement conference for February 25, 2008, and a jury trial before the

magistrate judge for March 18, 2008, with voir dire set for March 17, 2008.

After the June 19, 2007 case management conference, Defendants made a motion

for an extension of time until July 9, 2007 to file its Rule 26 discovery responses.

Defendants subsequently withdrew this motion, and submitted their Rule 26 discovery

responses on June 9, 2007.

The district court held an additional pretrial conference on June 17, 2007, which

Defendants’ counsel attended in person, and which Defendant Riordan attended by

telephone. The district court also stayed litigation pending mediation as contemplated

by the parties’ contract.

After participating in the above-described proceedings, on April 1, 2009,

Defendants filed a motion to dismiss for lack of personal jurisdiction, arguing that their

contacts with Ohio were insufficient to support personal jurisdiction over them in that

forum. The magistrate judge granted Defendants’ motion on May 28, 2009, and

dismissed the action for lack of personal jurisdiction pursuant to Federal Rule of Civil

Procedure 12(b)(2).

Plaintiff timely appealed.

DISCUSSION

I. Standard of Review

“We review de novo a district court’s dismissal of a complaint for lack of

personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure.”

Bird v. Parsons, 289 F.3d 865, 971 (6th Cir. 2002); see also Calphalon Corp. v.

Roulette, 228 F.3d 718, 721 (6th Cir. 2000).

No. 09-3790 Gerber v. Riordan, et al. Page 5

II. Analysis

“Personal jurisdiction can be either general or specific, depending upon the

nature of the contacts that the defendant has with the forum state.” Id. at 873. This

Court has explained the difference between these two types of jurisdiction as follows:

“General jurisdiction is proper only where a defendant’s contacts with the forum state

are of such a continuous and systematic nature that the state may exercise personal

jurisdiction over the defendant even if the action is unrelated to the defendant’s contacts

with the state.” Id. Specific jurisdiction, however, is proper only “in a suit arising out

of or related to the defendant’s contacts with the forum.” Id. at 874.

In this case, Plaintiff concedes that Defendants’ contacts with Ohio are

insufficient to support general jurisdiction in that forum. Ordinarily, in the absence of

general jurisdiction, the only question before the Court is whether the district court had

personal jurisdiction over Defendants based on specific jurisdiction. An exception to

this rule occurs when a party fails to assert, or waives its general jurisdiction defense by,

for example, entering a general appearance with the district court. See Calphalon, 228

F.3d at 721. It is with this exception that we deal in this case.

In a diversity case, such as the instant action, this Court uses a two part test to

ascertain whether the district court has personal jurisdiction over a defendant. See, e.g.,

id. at 721; CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996). “The

exercise of personal jurisdiction is valid only if it meets both the state long-arm statute

and constitutional due process requirements.” Calphalon, 228 F.3d at 721.

Ohio’s long-arm statute states in relevant part:

A court may exercise personal jurisdiction over a person who acts

directly or by an agent, as to a cause of action arising from the person’s:

(1) Transacting any business in this state;

(2) Contracting to supply services or goods in this

state;

(3) Causing tortious injury by an act or omission in

this state;

...

No. 09-3790 Gerber v. Riordan, et al. Page 6

(6) Causing tortious injury in this state to any person

by an act outside this state committed with the

purpose of injuring persons, when he might

reasonably have expected that some person would

be injured thereby in this state.

Ohio Rev. Code § 2307.382(A). Although we “have recognized that Ohio’s long-arm

statute is not coterminous with federal constitutional limits,” Bird, 289 F.3d at 871, our

jurisprudence analyzing personal jurisdiction under Ohio law has nevertheless done so

with reference to the limits of federal constitutional due process. See id. Specifically,

this Court has “consistently focused on whether there are sufficient minimum contacts

between the nonresident defendant and the forum state so as not to offend traditional

notions of fair play and substantial justice.” Id. (quoting Int’l Shoe Co. v. Washington,

326 U.S. 310, 316 (1945)).

Under this Court’s due process jurisprudence, “[s]pecific jurisdiction over

[Defendants] is permissible only if their contacts with Ohio satisfy the three-part test that

this [C]ourt established in Southern Machine Co. v. Mohasco Industries, Inc., 401 F.2d

374, 381 (6th Cir. 1968).” Id. at 874. As this Circuit has previously stated,

First, the defendant must purposefully avail himself of the privilege of

acting in the forum state or causing a consequence in the forum state.

Second, the cause of action must arise from the defendant’s activities

there. Finally, the acts of the defendant or consequences caused by the

defendant must have a substantial enough connection with the forum

state to make the exercise of jurisdiction over the defendant reasonable.

Calphalon, 228 F.3d at 721 (quoting S. Mach. Co., 401 F.2d at 381).

However, setting forth the constitutional requirements for a court’s exercise of

personal jurisdiction over a defendant does not necessarily end our inquiry. Rather,

because “the requirement of personal jurisdiction flows from the Due Process Clause and

protects an individual liberty interest,” Days Inn Worldwide, Inc. v. Patel, 445 F.3d 899,

905 (6th Cir. 2006), “an individual may submit to the jurisdiction of the court by

appearance.” Ins. Corp. of Ireland, LTD v. Compagnie des Bauxite de Guinea, 456 U.S.

694, 703 (1982). In so doing, a defendant would waive his potential personal

No. 09-3790 Gerber v. Riordan, et al. Page 7

jurisdiction defense. As we have explained, “[t]he requirement that a court have

personal jurisdiction is a due process right that may be waived either explicitly or

implicitly. The actions of the defendant may amount to a legal submission to the

jurisdiction of the court.” Days Inn, 445 F.3d at 905; see also Fed. R. Civ. P 12(h)(1)

(stating that “[a] party waives any defense listed in Rule 12(b)(2)-(5),” including the

defense of lack of personal jurisdiction, by “failing to either: (i) make it by motion under

this rule; or (ii) include it in a responsive pleading.”).

In this case, Defendants initially responded to Plaintiff’s complaint by filing a

pro se motion to dismiss for lack of personal jurisdiction, which the district court

rejected for reasons unrelated to the motion’s merits. However, prior to renewing their

motion to dismiss for lack of personal jurisdiction on April 1, 2009, Defendants

participated in the litigation of this case as follows: (1) Defendants secured the services

of an attorney who entered an appearance with the district court on behalf of Defendants

on October 16, 2006; (2) Defendants filed a motion to stay litigation pending arbitration

on October 31, 2006; (3) Defendants filed a motion to vacate the default judgment

entered against Defendants on November 1, 2006; (4) Defendants filed an opposition to

Plaintiff’s motion for mediation in Toledo, Ohio on December 21, 2006; (5) Defendants

participated in a case management conference with the district court on June 19, 2007;

(6) Defendants filed a motion for an extension of time until July 9, 2007 to file their Rule

26 discovery responses on July 3, 2007, a motion which Defendants subsequently

withdrew on July 6, 2007; (7) Defendants made a motion to enforce a settlement

agreement on July 6, 2007, which Defendants subsequently withdrew on March 3, 2009;

(8) Defendants made their Rule 26 discovery responses on July 9, 2007; and

(9) Defendants participated in a pretrial conference held by the district court on June 17,

2007.

In deciding whether Defendants waived their personal jurisdiction defense, we

must determine whether any of Defendants’ appearances and filings in the district court

constituted “legal submission to the jurisdiction of the court.” Days Inn, 445 F.3d at

905. As an initial matter, we note that while “the voluntary use of certain [district] court

No. 09-3790 Gerber v. Riordan, et al. Page 8

procedures” serve as “constructive consent to the personal jurisdiction of the [district]

court,” Compagnie des Bauxite de Guinea, 456 U.S. at 704, not all do. See Mobile

Anesthesiologists Chicago, LLC v. Anesthesia Associates of Houston Metroplex, P.A.,

623 F.3d 440, 443 (7th Cir. 2010). Only those submissions, appearances and filings that

give “[P]laintiff a reasonable expectation that [Defendants] will defend the suit on the

merits or must cause the court to go to some effort that would be wasted if personal

jurisdiction is later found lacking,” id. at 443, result in waiver of a personal jurisdiction

defense.

There is a dearth of caselaw both in this Circuit, and in our sister circuits,

defining precisely what types of appearances and filings qualify as “a [defendant’s]

legal submission to the jurisdiction of the court,” Days Inn, 445 F.3d at 905, and give a

“plaintiff a reasonable expectation that it will defend the suit on the merits.” Mobile

Anesthesiologists, 623 F.3d at 443. Thus, we take this opportunity to discuss some of

the contours of this area of the law.

Although at the end of the day we find that Defendants did waive their personal

jurisdiction defense when their attorney entered a general appearance with the district

court, not all of Defendants’ actions participating in the instant litigation were sufficient

to signal Defendants’ voluntary submission to the district court’s jurisdiction. Thus, not

all of Defendants’ filings could themselves constitute a waiver of Defendants’ personal

jurisdiction defense.

Defendants did not accede to the district court’s jurisdiction in moving to stay

the litigation pending arbitration. As we discussed above, “[t]o waive or forfeit a

personal jurisdiction defense, a defendant must give a plaintiff a reasonable expectation

that it will defend the suit on the merits or must cause the court to go to some effort that

would be wasted if personal jurisdiction is later found lacking.” Id. A motion to stay

litigation signals only that a defendant wishes to postpone the court’s disposition of a

case. Far from indicating that a defendant intends to defend a suit on the merits, a

motion to stay can serve to indicate the opposite – that a defendant intends to seek

alternate means of resolving a dispute, and avoid litigation in that jurisdiction.

No. 09-3790 Gerber v. Riordan, et al. Page 9

Therefore, Defendants’ motion for a stay “does not come close to what is required for

waiver or forfeiture” of a personal jurisdiction defense. Id.; see also Lane v. XYZ

Venture Partners, L.L.C., 332 F. App’x 675, 678 (11th Cir. 2009) (holding that

defendants “did not waive their defense of lack of personal jurisdiction by moving to

stay the proceedings”).

Similarly, Defendants’ motion to vacate the default judgment, without more,

would not have resulted in a waiver of their personal jurisdiction defense. We have held

that a personal jurisdiction defense is not waived when a party makes a special

appearance solely to contest personal jurisdiction’s existence. See Calphalon, 228 F.3d

at 721 (citing Fed. R. Civ. P. 12(b)(2)). This is so because by appearing solely to contest

jurisdiction, a defendant clearly indicates that he is not willing to submit to the district

court’s jurisdiction. By the same token, we have held that “defects in personal

jurisdiction are not waived by default when a party fails to appear or to respond . . . until

after the default judgment was entered.” Reynolds v. Int’l Amateur Athletic Fed’n,

23 F.3d 1110, 1121 (6th Cir. 1994) (holding that a defendant did not waive his personal

jurisdiction defense by moving to vacate a default judgment). Therefore, because

moving to vacate a default judgment is not an indication that a defendant is submitting

to the jurisdiction of the district court for disposition of a suit’s merits, Defendants did

not waive their personal jurisdiction defense by moving to vacate the district court’s

entry of a default judgment.

Nevertheless, it is clear that Defendants’ filing of a general appearance with the

district court constituted a voluntary acceptance of the district court’s jurisdiction, and

therefore, a waiver of Defendants’ personal jurisdiction defense. We have held that

“Under [Federal Rule of Civil Procedure] 12(h), a party waives the right to contest

personal jurisdiction by failing to raise the issue when making a responsive pleading or

a general appearance.” Id. at 1120; accord Baragona v. Kuwait Gulf Link Transp. Co.,

594 F.3d 852, 854 (11th Cir. 2010) (“A defendant normally . . . waives a personal

jurisdiction defense if he or she has entered an appearance.”); Ladder Man, Inc. v. Mfr.’s

Distrib. Serv., Inc., No. 99-4217, 2000 U.S. App. LEXIS 27982, at *7 (6th Cir. Oct. 31,

No. 09-3790 Gerber v. Riordan, et al. Page 10

2000) (table). Therefore, Defendants’ attorney’s entry of a general appearance with the

district court on behalf of Defendants on October 16, 2006 constituted a waiver of

Defendants’ personal jurisdiction defense.

CONCLUSION

Defendants waived their lack of personal jurisdiction defense, and voluntarily

submitted to the district court’s jurisdiction, when their attorney entered a general

appearance with the district court on their behalf. Accordingly, we REVERSE the

decision of the court below, and REMAND the case for further proceedings consistent

with this opinion.

No. 09-3790 Gerber v. Riordan, et al. Page 11

___________________

CONCURRENCE

___________________

KAREN NELSON MOORE, Circuit Judge, concurring. I agree with the

majority that the defendants have waived any challenge to personal jurisdiction through

their participation in the proceedings below. I also agree that the key question in this

case is when the defendants gave an indication that they intended to defend this suit on

the merits. See Mobile Anesthesiologists Chicago, LLC v. Anesthesia Assocs. of Houston

Metroplex, P.A., 623 F.3d 440, 443 (7th Cir. 2010). I disagree, however, with the

majority’s conclusion that the critical point here was the defendants’ counsel’s filing of

an Entry of Appearance—a one-sentence announcement of the identity of the

defendants’ attorney of record. In my view, the defendants consented to the personal

jurisdiction of the district court when they filed a motion to enforce a settlement

agreement that the defendants believed was valid at that time. Perhaps more

importantly, however, I believe that the holding of the majority is unwise; in light of the

facts of this case, a formalistic, one-sentence notice of appearance as counsel simply

cannot amount to a waiver of the right to file a motion to dismiss for lack of personal

jurisdiction under Federal Rule of Civil Procedure 12(b)(2). I therefore concur in the

judgment only.

I. THE MAJORITY ADOPTS A NEW TEST FOR WAIVER

OF PERSONAL-JURISDICTION DEFENSES,

BUT THEN APPLIES THE OLD ONE.

Before the Federal Rules of Civil Procedure were adopted in 1938, a defendant

seeking to challenge the district court’s exercise of personal jurisdiction would make a

limited, or “special,” appearance before the court to lodge the objection. See, e.g.,

Harkness v. Hyde, 98 U.S. (8 Otto) 476, 478–79 (1878); see generally 5B CHARLES

ALAN WRIGHT, ARTHUR R. MILLER, MARY KAY KANE & RICHARD L. MARCUS,

FEDERAL PRACTICE AND PROCEDURE § 1344 (3d ed. 2011). This special appearance was

conceptually different from a “general” appearance, which was viewed as a sign that the

No. 09-3790 Gerber v. Riordan, et al. Page 12

defendant acknowledged the existence of personal jurisdiction and intended to defend

the action on the merits. See Goldey v. Morning News, 156 U.S. 518, 521 (1895) (stating

that personal jurisdiction can be acquired over the defendant “by his waiver, by general

appearance or otherwise”). “The term ‘general appearance’ historically applied to the

defendant’s submission of pleadings or motions, not limited to jurisdictional questions,

regardless of whether the defendant or the defendant’s attorney is physically present in

court.” 16-108 JAMES WM. MOORE ET AL., MOORE’S FEDERAL PRACTICE, § 108.53[2]

(3d ed. 2011).

Rule 12 changed the practices surrounding challenges to personal jurisdiction,

notably by ending reliance on the appearance doctrine. “Rule 12 . . . abolished for the

federal courts the age-old distinction between general and special appearances.” Orange

Theatre Corp. v. Rayherstz Amusement Corp., 139 F.2d 871, 874 (3d Cir. 1944) (en

banc). Acknowledging this, we have held that, “In order to object to a court’s exercise

of personal jurisdiction, it is no longer necessary to enter a ‘special appearance.’” Cty.

Sec. Agency v. Ohio Dep’t of Commerce, 296 F.3d 477, 483 (6th Cir. 2002); see also

Haile v. Henderson Nat’l Bank, 657 F.2d 816, 820 n.4 (6th Cir. 1981) (stating, with

respect to challenges to service of process, that “a ‘special appearance’ to challenge

[personal] jurisdiction is no longer necessary under the Federal Rules. A defendant must

attack the validity of service of process pursuant to Rule 12(b).”). On the other hand,

the term “general appearance” still appears in some cases in the context of personal-

jurisdiction challenges, although a precise definition of exactly what qualifies as a

general appearance is not provided. See Reynolds v. Int’l Amateur Athletic Fed’n, 23

F.3d 1110, 1120 (6th Cir. 1994) (“Under F.R.C.P. 12(h), a party waives the right to

contest personal jurisdiction by failing to raise the issue when making a responsive

pleading or a general appearance.”); Rauch v. Day & Night Mfg. Corp., 576 F.2d 697,

700 (6th Cir. 1978) (quoting Goldey, 156 U.S. at 521); see also 16-108 MOORE’S

FEDERAL PRACTICE § 108.53[2] (“The term [“general appearance”] is still widely used

to describe acts by the defendant sufficient to support jurisdiction, even in discussions

of jurisdiction in courts that have adopted the Federal Rules of Civil Procedure, which

No. 09-3790 Gerber v. Riordan, et al. Page 13

provide a waiver procedure instead of the appearance doctrine.”) (internal citation

omitted).

Rule 12(h)(1) now sets out the circumstances in which a challenge to personal

jurisdiction can be waived. According to the rule:

A party waives any defense listed in Rule 12(b)(2)-(5) by:

(B) failing to either:

(i) make it by motion under this rule; or

(ii) include it in a responsive pleading or in an

amendment allowed by Rule 15(a)(1) as a matter of

course.

FED. R. CIV. P. 12(h)(1)(B). Such an inquiry is easy in most cases. One can look at the

defendant’s answer or pre-answer motion; either personal jurisdiction is raised or it isn’t.

Yet cases like the present one, in which numerous other issues are raised from the outset

of the case, can present a more difficult situation. Notwithstanding the absence of an

answer or pre-answer motion, a defendant can still waive a personal-jurisdiction

challenge by certain participation in the litigation. See Ins. Corp. of Ireland, Ltd. v.

Compagnie des Bauxite de Guinee, 456 U.S. 694, 703 (1982); Days Inn Worldwide, Inc.

v. Patel, 445 F.3d 899, 905 (6th Cir. 2006).1

To assess whether such a waiver through participation in the litigation has been

made, several other circuits take a common-sense approach to determining whether a

party has waived a personal-jurisdiction challenge. All of these attempt to ensure

compliance with the spirit of Rule 12—“which is to expedite and simplify proceedings

1

“Waiver is different from forfeiture. Whereas forfeiture is the failure to make the timely

assertion of a right, waiver is the intentional relinquishment or abandonment of a known right.” United

States v. Olano, 507 U.S. 725, 733 (1993). We have held that participation in litigation that results in the

loss of the right to challenge personal jurisdiction constitutes waiver, see Patel, 445 F.3d at 905 n.6, but

the Second Circuit has opted to describe this as forfeiture. In the Second Circuit’s view, “Where a

litigant’s action or inaction is deemed to incur the consequence of loss of a right, or, as here, a defense,

the term ‘forfeiture’ is more appropriate.” Hamilton v. Atlas Turner, Inc., 197 F.3d 58, 61 (2d Cir. 1999).

Along with the Second Circuit, I believe that the term “forfeiture” is a more accurate description of a

defendant’s loss of the right to challenge personal jurisdiction, but I will use the term “waiver” in the

remainder of this opinion, consistent with our circuit’s established practice.

No. 09-3790 Gerber v. Riordan, et al. Page 14

in the Federal Courts,” Yeldell v. Tutt, 913 F.2d 533, 539 (8th Cir. 1990) (internal

quotation marks omitted)—when the letter of Rule 12 itself does not provide clear

guidance.2

Perhaps the best description of this approach comes from a Seventh Circuit case

cited by the majority, Mobile Anesthesiologists: “To waive or forfeit a personal

jurisdiction defense, a defendant must give a plaintiff a reasonable expectation that it

will defend the suit on the merits or must cause the court to go to some effort that would

be wasted if personal jurisdiction is later found lacking.” 623 F.3d at 443. The Seventh

Circuit has also asked whether the defendants’ actions “manifest[] an intent to submit

to the court’s jurisdiction” and whether they comply with “the spirit of” Rule 12(h) even

where they already comply with the letter of the rule. Continental Bank, N.A. v. Meyer,

10 F.3d 1293, 1297 (7th Cir. 1993). This straightforward description of the inquiry to

be undertaken has the advantage of ensuring that cases with atypical preliminary

pleading histories, such that the letter of Rule 12 is difficult to apply, are decided in a

manner that comports with the policy behind Rule 12(h). It also parallels the inquiry

undertaken in a related situation: determining whether a defendant’s purposeful

availment of a forum state—separate and apart from participation in the litigation at

issue—results in the existence of specific jurisdiction.3 As the Supreme Court recently

observed with respect to specific jurisdiction, “The principal inquiry in cases of this sort

is whether the defendant’s activities manifest an intention to submit to the power of a

2

For example, the Federal Circuit has advanced the notion that a personal-jurisdiction challenge

must be made “‘at the time the first significant defensive move is made[.]’” Rates Tech., Inc. v. Nortel

Networks Corp., 399 F.3d 1302, 1307 (Fed. Cir. 2005) (quoting 5C CHARLES ALAN WRIGHT & ARTHUR

R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1391 (3d ed. 2004)). The Second Circuit has held that

forfeiture of personal jurisdiction may occur through both conduct and missed opportunities to litigate the

issue. Hamilton, 197 F.3d at 61. In Hamilton, the court faulted the defendants for failing to litigate

personal jurisdiction despite “four distinct opportunities to move to dismiss during [a] four-year interval.”

Id. Lastly, the D.C. Circuit has noted that even where Rule 12(h) cannot be applied literally, courts should

apply the rule’s “rationale—that defendants should raise such preliminary matters before the court’s and

parties’ time is consumed in struggle over the substance of the suit—where a defendant has engaged in

extensive post-default litigation without suggesting an infirmity in personal jurisdiction.” Democratic

Republic of Congo v. FG Hemisphere Assocs., LLC, 508 F.3d 1062, 1064 (D.C. Cir. 2007).

3

Personal jurisdiction can exist in two forms: specific jurisdiction and general jurisdiction. “In

contrast to general, all-purpose jurisdiction, specific jurisdiction is confined to adjudication of issues

deriving from, or connected with, the very controversy that establishes jurisdiction.” Goodyear Dunlop

Tires Operations, S.A. v. Brown, – U.S. ----, 131 S. Ct. 2846, 2851 (2011) (internal quotation marks

omitted). We deal here only with specific jurisdiction.

No. 09-3790 Gerber v. Riordan, et al. Page 15

sovereign.” J. McIntyre Mach., Ltd. v. Nicastro, – U.S. —, 131 S. Ct. 2780, 2788 (June

27, 2011).

Unfortunately, although the majority states at the outset that it approves of this

type of inquiry, it does not go further and undertake it. Instead, it engages in a two-step

line of analysis that makes no mention of whether the defendants gave the plaintiffs “a

reasonable expectation that [they] will defend the suit on the merits” or whether the

defendants had “cause[d] the court to go to some effort that would be wasted if personal

jurisdiction is later found lacking.” First, the majority relies on a case mentioning (but

not explaining) the old (and abandoned) distinction between special and general

appearances. See Reynolds, 23 F.3d at 1120 (“Under F.R.C.P. 12(h), a party waives the

right to contest personal jurisdiction by failing to raise the issue when making a

responsive pleading or a general appearance.”). Then the majority states, without further

explanation, that the defendants filed a document that constitutes a general appearance,

thereby waiving any objections to personal jurisdiction. As explained below, this makes

no sense.

II. A ONE-SENTENCE NOTICE OF APPEARANCE OF

COUNSEL, FILED IN RESPONSE TO A COURT

ORDER, IS NOT RELEVANT TO RULE 12.

The defendants in this case filed numerous documents in the district court before

the April 1, 2009 motion to dismiss for lack of personal jurisdiction. These filings

included the following:

• October 16, 2006: Entry of appearance as counsel. (R. 22)

• October 30, 2006: Motion to stay pending arbitration. (R. 23)

• November 1, 2006: Motion to vacate the notice of default. (R. 24)

• July 3, 2007: Motion for an extension of time to file Rule 26

disclosures. (R. 40)

• July 6, 2007: Motion to enforce a settlement agreement. (R. 42)

• July 9, 2007: Initial disclosures. (R. 44)

No. 09-3790 Gerber v. Riordan, et al. Page 16

• March 27, 2009: Motion to withdraw the July 6, 2007 motion to

enforce a settlement agreement. (R. 65)

The majority picks the first of these filings: the Entry of Appearance filed by the

defendants’ attorney on October 16, 2006. Even insofar as the term “general

appearance” may be useful in this context as a short-hand way of referring to pleadings

or motions that “give a plaintiff a reasonable expectation that [the defendants] will

defend the suit on the merits or [that] cause the court to go to some effort that would be

wasted if personal jurisdiction is later found lacking,” Mobile Anesthesiologists, 623

F.3d at 443, I do not believe that the Entry of Appearance filed in this case falls within

this concept. This Entry of Appearance document is a one-page—indeed, one-

sentence—pro forma notice of appearance of counsel. In its entirety, it reads: “Now

comes Richard M. Kerger and enters his appearances [sic] as counsel for defendants,

James C. Riordan and Seven Locks Press Corp. in this matter.” R. 22 (Entry of

Appearance). This document does nothing more than give notice of the identity of the

defendants’ counsel of record. As the Supreme Court of Florida noted when it rejected

the notion that the filing of a notice of appearance will waive a personal-jurisdiction

challenge under Florida law, such a document “indicates no acknowledgment of the

court’s authority, contains no request for the assistance of its process, and, most

important, reflects no submission to its jurisdiction . . . . Such a conclusion [of waiver]

represents . . . no less than the apotheosis of a meaningless technicality.” Public Gas Co.

v. Weatherhead Co., 409 So.2d 1026, 1027 (Fla. 1982) (internal quotation marks

omitted). The Entry of Appearance filed in this case therefore was not, in my view, the

sort of participation in litigation that constitutes a submission to the personal jurisdiction

of the district court.

Moreover, the context in which this particular document was filed demonstrates

clearly that it did not constitute a general appearance and that it did not give the

plaintiffs an indication that the defendants would defend the suit on the merits. On

August 7, 2006, at the very beginning of the suit, the defendants filed a pro se motion

to dismiss for lack of personal jurisdiction. R. 9 (Motion to Dismiss). Because

corporate defendants are not permitted to proceed pro se, the district court ordered

No. 09-3790 Gerber v. Riordan, et al. Page 17

defendant Seven Locks Press to “cause an appearance to be filed on its behalf by counsel

or otherwise show why its default should not be entered and further proceedings

scheduled accordingly.” R. 14 (Order). The October 16, 2006, Entry of Appearance was

therefore filed directly in response to this order—not because the defendant’s attorney

was intending to defend the suit on the merits. How, then, could this perfunctory

document be construed as or deemed to be a submission to the personal jurisdiction of

the district court when it was filed in response to a court order?

Furthermore, at the time that the defendants filed the Entry of Appearance, the

pro se motion to dismiss for lack of personal jurisdiction was still pending. Additionally,

about two months later, the district court issued an order that “deemed” the pro se

motion to dismiss for lack of personal jurisdiction “withdrawn, without prejudice to

defendants’ right to renew said motion.” R. 28 at 2 (Order) (emphasis added). It was

clear to everyone, then, that as of the date of that order, December 8, 2006, the

defendants still retained the right to assert their personal-jurisdiction defense. As a

result, it makes no sense to find now that the Entry of Appearance, filed in response to

an order by the district court to identify corporate counsel, was also a full-fledged

consent to the district court’s exercise of personal jurisdiction over the defendants.

By the same token, the majority’s holding appears to be at odds with Rule 12

itself. Rule 12(h) gives a defendant the right to raise the defense of lack of personal

jurisdiction, along with the defenses of improper venue, improper process, and improper

service of process, in a pre-answer motion or in the answer, whichever is filed first. Rule

12(h) says nothing about the effect of notice-giving documents or documents entered in

response to a court order. Yet according to the majority, an attorney must now be wary,

lest the attorney’s client later be deemed to have unknowingly waived its right to contest

personal jurisdiction. In other words, as a result of the majority’s opinion, rather than

file a notice of appearance, an attorney is “required at the door of the federal courthouse

to intone that ancient abracadabra of the law, de bene esse, in order by its magic power

to enable himself to remain outside even while he steps within.” Orange Theatre Corp.,

No. 09-3790 Gerber v. Riordan, et al. Page 18

139 F.2d at 874. This is the procedure that Rule 12 was designed to change, not to

reinforce.

III. THE MOTION TO ENFORCE A SETTLEMENT AGREEMENT

CONSTITUTES WAIVER.

Several of the other filings of the defendants before their second motion to

dismiss for lack of personal jurisdiction present a close call as potential waivers. There

is one filing, however, that in my view clearly stands out as showing the obvious intent

of the defendants to submit to the personal jurisdiction of the court. I believe that the

defendants’ July 6, 2007 filing of a motion to enforce a settlement agreement allegedly

entered between the parties constituted the pivotal moment at which they undeniably

waived their personal-jurisdiction defense. R. 42 (Motion to Enforce Settlement). This

motion to enforce a settlement is clearly inconsistent with the idea that the district court

lacked personal jurisdiction over the defendants; indeed, the motion to enforce a

settlement directly seeks to have the district court use its power over the parties

(including the defendants) to bind them to a settlement agreement. See Mobile

Anesthesiologists, 623 F.3d at 443. This was also the defendants’ “first significant

defensive move,” Rates Technology, 399 F.3d at 1307, and it “manifest[ed] an intent to

submit to the court’s jurisdiction,” Continental Bank, 10 F.3d at 1297. The defendants’

act of waiting another twenty months to litigate personal jurisdiction also did not

conform to the spirit of Rule 12(h), which calls for an early invocation of a

personal-jurisdiction defense. Id.

I believe, moreover, that the defendants themselves likely recognized that the

motion to enforce the settlement agreement posed problems for their

personal-jurisdiction defense, because they moved to withdraw that motion immediately

before filing their second motion to dismiss for lack of personal jurisdiction. Compare

R. 65 (Motion to Withdraw Motion to Enforce Settlement, filed March 27, 2009); with

R. 67 (Order granting the defendants’ Motion to Withdraw, filed March 30, 2009); and

R. 68 (Motion to Dismiss, filed April 1, 2009). The withdrawal of the motion to enforce

the settlement agreement appears to have been gamesmanship: after unsuccessfully

seeking to have the district court bind the parties to a settlement agreement, the

No. 09-3790 Gerber v. Riordan, et al. Page 19

defendants then sought to remove this motion from the record to clear the way for a

personal-jurisdiction defense. I believe that we should reject this attempt.

***

Because I believe that the filing of a one-sentence notice of appearance as

counsel does not constitute a submission to the personal jurisdiction of the court, I

cannot agree with the reasoning of the majority opinion in this case. Yet because I

would hold that the defendants’ act of filing a motion to enforce a settlement agreement

clearly gave the plaintiffs “a reasonable expectation that [the defendants] w[ould] defend

the suit on the merits,” Mobile Anesthesiologists, 623 F.3d at 443, I concur in the

judgment.