# Petition for Writ of Certiorari — Humphreys (Cayman) Ltd. v. Wilson

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_1625%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1991
- **Citation:** 499 U.S. 947

## Text

In The
Supreme Court of the United States
October Term, 1990

Humphreys (Cayman) Limited,
Petitioner,
v.

Dorothy A. Wilson And Louie P. Wilson,
Respondents.

Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Seventh Circuit

Brian J. Martin
(Counsel Of Record)

James A. McDermott

Jan M. Carroll

BARNES & THORNBURG
1313 Merchants Bank Building
11 South Meridian Street
Indianapolis, In 46204

(317) 638-1313

Attomeys For Petitioner

“Sais iain Cie

QUESTION PRESENTED

Whether a foreign corporation that operates a hotel in
another country may, consistently with due process, be forced
to defend in the state of Indiana an action arising from injuries
suffered in the foreign hotel.

ee

PARTIES

The appellants in the court of appeals were Humphreys
(Cayman) Limited and Holiday Inns, Inc. The appellees were
Dorothy A. Wilson and Louie P. Wilson. Humphreys
(Cayman) Limited’s parent corporation is Humphreys Overseas
Development Company, Ltd. Humphreys (Cayman) Limited
has no nonwholly owned subsidiaries.

‘Ua.

RLS EL es

2S ee

—

arr
_. le aed S:

me

iii

TABLE OF CONTENTS

EEE
a
Constitutional provisions involved ...........
ES kk ke ee
Reasons for granting the petition ............
Se a
Appendix:
A. Opinion of the United States Court of Appeals

for the Seventh Circuit (October 24, 1990)

B. Opinion of the United States District Court for
the Southem District of Indiana (March 25,
ES REE Sa ee

C. Denial of Petition for Rehearing (November 21,
ES ee arr

iv

TABLE OF AUTHORITIES
Page

Case:

Shute v. Carnival Cruise Lines, 897 F.2d 377

(9th Cir. 1990), cert granted, No. 89-1647

ee ae eee at a Kw 3,4,5
Constitution, statute, and rule:

Due Process Clause, Amend. XIV .......... y

Ee Ce ss ee 6 a Oe ee 2

Taras. hs os ak we ee oe ae 3

No.

| In The
Supreme Court of the United States
October Term, 1990

Humphreys (Cayman) Limited,
Petitioner,
v.

Dorothy A. Wilson And Louie P. Wilson,
Respondents.

PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SEVENTH CIRCUIT

OPINIONS BELOW
The opinion of the court of appeals (App., infra, 1a-19a) is
reported at 916 F.2d 1239 (1990). The memorandum opinion
of the district court (App., infra, 20a-42a) is not reported.

JURISDICTION

The judgment of the court of appeals was entered on
October 24, 1990, and a petition for rehearing was denied on
November 21, 1990. App., infra, 43a. The jurisdiction of this
Court is invoked under 28 U.S.C. § 1254(1).

CONS: TTUTIONAL PROVISION INVOLVED

The Due Process Clause of the Fourteenth Amendment
provides: “No State shall . . . deprive any person of life, liberty,
or property, without due process of law.”

STATEMENT

1. Petitioner is incorporated under the laws of the Cayman
Islands. Petitioner operates a hotel in the Cayman Islands under
a license from Holiday Inns, Inc. At times relevant to this
action, petitioner had reservation offices in Miami, Florida, and
Memphis, Tennessee. Petitioner, however, had no other place
of business in the United States. App., infra, 2a.

In 1981, petitioner entered into a contract with American
Trans Air (American) to provide accommodations for tours run
by American to the Cayman Islands. Under that contract, the
rooms in petitioner’s Cayman Islands hotel were guaranteed at
a reduced rate for American’s tours. American, however, did
not act as an agent for petitioner; American had no authority to
bind jetitioner and it did not purport to do so. App., infra,
2a-3a, 14a-1Sa.

2. In 1986, respondents Dorothy and Louie Wilson com-
menced this action against petitioner and Holiday Inns, Inc. in
the United States District Court for the Southern District of
Indiana. That court’s jurisdiction was based on diversity of
citizenship and amount in controversy, see 28 U.S.C. § 1332.

Respondents are citizens of the state of Illinois. App., infra,
13a. Respendents allege in their complaint that they par-
ticipated in a tour organized by American that left Indianapolis,
Indiana on October 28, 1984. App., infra, 3a. Respondents
stayed at petitioner’s hotel in the Cayman Islands. Respondents
allege that, on October 30, 1984, Dorothy Wilson was assaulted

by an intruder in her hotel room. Respondents contend that
Dorothy Wilson suffered serious injuries as a result of that
attack. /d. at 3a. Respondents’ complaint then sets forth 13
counts against petitioner and Holiday Inns, Inc. Those counts
are based on theories of negligence, breach of contract, and
negligent infliction of emotional distress. Jd. at 3a.

3. The district court denied petitioner’s motion to dismiss
for lack of personal jurisdiction. App., infra, 41a. The court
noted that Indiana’s long-arm statute, Ind. Trial Rule 4.4,
reaches to the limits of the Due Process Clause. /d. at 30a. The
court then held that Indiana could constitutionally exercise
jurisdiction over petitioner because it had a business relation-
ship with an Indiana travel club and it advertised in national
periodicals Jd. at 36a. The district court certified its order for
immediate review by the court of appeals.

4. A divided panel of the courtofappeats affirmed. App.,
infra, 13a. The court ruled that petitioner had sufficient con-
tacts with Indiana so that “the district court correctly deter-
mined that [petitioner] is subject to persona! jurisdiction in
Indiana.” Jd. at 9a. The court of appeals stated that those
“contacts” were: (1) petitioner advertised in Indiana, (2)
petitioner entered into a contract with an Indiana tour company,
and (3) petitioner sent representatives to Indiana to negotiate
that contract. In support of its holding, the court cited the Ninth
Circuit’s opinion in Shute v. Carnival Cruise Lines, 897 F.2d
377 (9th Cir. 1990), cert granted, No. 89-1647 (Oct. 2, 1990).

Judge Will dissented. He observed that petitioner “had no
purposeful contacts with the plaintiffs or with Indiana related
to this suit, which arises from acts and events that took place
entirely in the Cayman Islands.” App., infra, !4a. He noted
that petitioner “did not sell products in Indiana, and [petitioner]
had no contacts whatsoever with the [respondents] in Indiana

or anywhere else in the United States.” /d. at 15a. Judge Will
contended that the majority’s “forcing [petitioner] to defend
this case in an Indiana courtroom is far from fair or substantially
just.” Id. at 14a.

Judge Will then discussed the implications of the majority’s
holding. He stated that, under the majority’s reasoning, the
Indiana courts may exercise jurisdiction over “any foreign
hotel, restaurant, museum or other facility or service provider,
which confirms reservations for U.S. travel agents and tour
operators and compensates those travel agents and tour
operators for arranging reservations (a frequent and typical
practice).” App., infra, 16a. That is true even though “all the
acts and events alleged” in the complaint may have “occurred
in Timbuktu, Bali, Japan, Australia, Majorca, Tahiti or where-
have-you.” Jd. Judge Will concluded that “[tJhe kind of global
long-arm jurisdiction which the majority endorses ... both fails
the minimum contacts test and is at odds with the func. mental
due process requirement that jurisdiction comport with ‘fair
play and substantial justice.”” Jd.

The panel denied a petition for rehearing. App., infra, 43a.

REASONS FOR GRANTING THF PETITION

On October 2, 1990, this Court granted certiorari in Car-
nival Cruise Lines, Inc. v. Shute, No. 89-1647 (argued Jan. 15,
1991). In that case, the plaintiff, a citizen of the forum state of
Washington, seeks damages for injuries sustained in a fall on a
cruise ship. The defendant is the Panamanian corporation that
owns and operates the ship. The Panamanian corporation
advertises in the state of Washington, has contractual relation-
ships with Washington travel agents, and holds seminars for
travel agents in Washington. 897 F.2d 377, 379 (9th Cir. 1990).
Under those facts, the Ninth Circuit ruled that the state of

Washington could, consistently with due process, exercise
jurisdiction over the Panamanian corporation. /d. at 380-87.
This Court granted certiorari to review that ruling.

This Court’s decision in Carnival Cruise Lines will likely
govern the outcome of the jurisdictional issue in this case.
Indeed, the Panamanian corporation’s contacts with
Washington are more substantial than petitioner’s contacts with
Indiana. See 897 F.2d at 379. Accordingly, if this Court
reverses the judgment in Carnival Cruise Lines, it will follow
a fortiori that the judgment in this case must be reversed.
Hence, this petition should be held and disposed of in light of
the Court’s decision in Carnival Cruise Lines.

The petition for a writ of certiorari in Carnival Cruise Lines
raises an issue in addition to the due-process question. The
second question is whether a contractual provision requiring suit
to be brought in Florida is enforceable. The Ninth Circuit held
that it was not. 897 F.2d at 389. Thus, this Court could logically
reverse the Ninth Circuit’s judgment without reaching the due-
process question. If that occurs, then the Court should grant
plenary review in this case. The important jurisdictional issue
regarding foreign corporations is necessarily presented by this
petition. And for the reasons given in the petition in Carnival
Cruise Lines, that issue deserves resolution by this Court.

CONCLUSION

The petition for a writ of certiorari shouid be held and
disposed of in light of this Court’s decision in Carnival Cruise
Lines, Inc. vy. Shute, No. 89-1647.

Respectfully submitted,

Brian J. Martin
(Counsel of record)

James A. McDermott

Jan M. Carroll

BARNES & THORNBURG
1313 Merchants Bank Bldg.
11 South Meridian Street
Indianapolis, IN 46204
(317) 638-1313

Attorneys for Petitioner
Humphreys (Cayman) Limited

la

| In the
United States Court of Appeals

Hor the Seventh Circuit

Nos. 88-2495 & 88-2496
DOROTHY A. WILSON and LOUIS P. WILSON,
Plaintiffs-Appellees,
v.
HUMPHREYS (CAYMAN) LIMITED, a corporation, and
HOLIDAY INNS, INC., a corporation,

a

Defendants-Appellants.

On Appeal from the United States Distnct Court
for the Southem District of Indiana, Indianapolis Division.
No. 86-C-197 - Larry J. McKinney, Judge.

ARGUED OCTOBER 31, 1989 - DECIDED OCTOBER 24, 1990

Before BAUER, Chief Judge and RIPPLE, Circuit Judge, and
WILL, Senior District Judge.*

RIPPLE, Circuit Judge. Dorothy and Louis Wilson initiated
this diversity action in 1986. The Wilsons asserted that the two
defendants involved in this appeal, together with a third defen-
dant, were liable to them for damages in connection with a
serious injury suffered by Mrs. Wilson while staying as a guest

” The Honorable Hubert L. Will of the United States District Court
for the Northern District of Illinois, Eastern Division, is sitting by
designation.

in appellant Humphreys’ Hotel. ! Humphreys and Holiday Inns
moved to dismiss the complaint due to lack of subject matter
and personal jurisdiction, and asserted that the forum selected
by the plaintiffs violated the doctrine of forum non conveniens.
The district court denied these motions. Upon application by
the appellants, the district court certified the questions of juris-
diction and forum non conveniens to this court on May 25, 1988
(for Humphreys), and July 7, 1988 (for Holiday Inns). This
court accepted the appeal on July 13, 1988. We now affirm the
judgment of the district court in part and remand for further
consideration.

I
BACKGROUND

Humphreys (Cayman) Limited is incorporated under the laws
of the Cayman Islands. Humphreys is a licensee of appellant
Holiday Inns, Inc. and operates a hotel in the Cayman Islands
under authority of that license. Humphreys maintains a cor-
porate office in Memphis, Tennessee and has operated a reser-
vations office in Miami, Florida. Holiday Inns, Inc. is a
Tennessee corporation and is registered to do business in In-
diana. The record does not reveal the nature or extent of its
activities within the state.

Since 1976, Humphreys has participated in a continuing
commercial relationship with American Trans Air (American)
to provide accommodations for tours run by American to the
Cayman Islands. As pait of this relationship, Humphreys sent
officers to Indianapolis on at least one occasion to meet with
representatives of American. During a trip to Indiana in the
sunwner of 1981, Humphreys’ representatives negotiated a
long-term contract with American by which a certain number

' One of the original defendants, American Trans Air, Inc., moved
for summary judgment, which was granted by the district court on
Apnil 6, 1988. The district court entered final judgment pursuant to
Rule 54(b) of the Federal Rules of Civil Procedure and that por ion of
the case was appealed immediately. This court affirmed the district
court's CONF — the air carrier in Wi/son v. American Trans
Air, Inc., 874 F.2d 386 (7th Cir. 1989).

3a

of rooms at Humphreys’ hotel would be guaranteed at a reduced
rate for American-run tours, with American tour leaders receiv-
ing free accommodations. American frequently has listed trips
to the Cayman Islands in its regular advertising brochures and
has included specific references to Humphreys’ hotel. In addi-
tion, Humphreys advertises extensively in national magazines
directed both at travel agents and potential travellers.
Humphreys printed rate cards and brochures that it sent for
further distribution to American in Indiana and to various travel
agents around the country.

Dorothy and Louis Wilson participated in a tour organized by
American that left Indianapolis International Airport on Oc-
tober 28, 1984. The group stayed at Humphreys’ hotel in the
Cayman Islands. According to Mrs. Wilson’s affidavit, arran-
gements for the trip were made as a result of advertisements for
the tour that appeared in American’s travel bulletin. Arrange-
ments were made with American’s tour subsidiary, Ambas-
sadair, and payment was made to Ambassadair in Indianapolis,
Indiana.

On October 30, 1984, Mrs. Wilson was assaulted by an
intruder in her hotel room. The intruder attempted to rob and
rape Mrs. Wilson, and she suffered serious injuries. She spent
a week in a hospital on the Cayman Islands and then returned
to Indianapolis to be treated at Methodist Hospital.

The complaint contains thirteen counts against the two appel-
lants in this case. The counts charge the appellants with
negligence, breach of express and implied warranties, breach of
contract, and negligent infliction of emotional distress. The
appellants moved to dismiss the complaint on the grounds of
lack of subject matter or personal jurisdiction, and forum non
conveniens. The district court denied these motions, but sub-
sequently certified them for interlocutory appeal pursuant to 28
U.S.C. § 1292(b). We accepted the appeal and now consider
each issue in tum.

4a

Il
ANALYSIS
A. Subject Matter Jurisdiction

Diversity jurisdiction ia this suit is based on 28 U.S.C.
§ 1332(a)(3), which provides for jurisdiction when the suit 1s
between “citizens of different States and in which citizens or
subjects of a foreign state are additional parties.” Humphreys
argues that the district court cannot exercise subject matter
jurisdiction over it because it is a company incorporated | in the
Cayman Islands, and the Cayman Islands is not a “foreign state.”
Humphreys reaches this conclusion by noting that the Cayman
Islands is a dependency of Great Britain and that the United
States does not regard the Cayman Islands as an independent
sovereign. See The World Factbook 1989 at 56.

The power to exercise jurisdiction over a foreign citizen under
28 U.S.C. § 1332 has been referred to as “alienage jurisdiction.”
Sadat v. Mertes, 615 F.2d 1176, 1182 (7th Cir. 1980). This type
of jurisdiction “was intended to provide the federal courts with a
fonn of protective jurisdiction over matters implicating intemna-
tional relations where the national interest was paramount.” /d.

“The dominant considerations which prompted the
provision for such jurisdiction appear to have been:

(1) Failure on the part of individual states to give protec-
tion to foreigners under treaties; . . . [and]

(2) Apprehension of entanglements with other sovereigns
that might ensue from failure to treat the legal controversies
of aliens on a national level.”

Id. (quoting Blair Holdings Corp. v. Rubinstein, 133 F. Supp.
496, 500 (S.D.N.Y. 1955).

Our inquiry therefore must be whether the policies supporting
alienage jurisdiction permit a United States District Caprt to
assume jurisdiction over a citizen of the Cayman Islands.” The

A

~ Corporations are considered citizens of the country in which they
are incorporated. National Steamship Co. v. Tugman, 106 U.S. (16
Otto) 118, 120-21 (1882), Panalpina Welttransport GMBH v.
Geosource, Inc., 764 F.2d 352, 354 (Sth Cir. 1985).

Cayman Islands is a British Dependent Territory.” A citizen
of a British Dependent Territory is a “citizen of the
United Kingdom and Colonies.” British Nationality Act
1981 § SI(3)(ayi). According to an affidavit of a Cayman
Islands attorney submitted by Humphreys, the court system in
the Cayman Islands is patterned after that of Great Britain. In
addition, “[t]he Common Law of England .. . is recognised and
applied by the Courts in all cases where there has not been a
specific local enactment.” Humphreys’ App. at 66. The
Cayman Islands is administered by a governor who Is appointed
by the British monarch. The United Kingdom represents
Caymanian diplomatic interests and is responsible for its
military defense. The World Factbook 1989 at 56.

Several federal courts have determined, although generally
without discussion, that subject matter jurisdiction existed in
suits between citizens of the United States and Cayman Island
corporations. See Bally Export Corp. v. Balicar, Ltd., 804 F.2d
398, 399-400 (7th Cir. 1986); Philan Ins. Ltd. v. Frank B. Hall
& Co.,Inc., 712 F. Supp. 339, 345(S.D.N.Y. 1989), Rolls Royce
(Canada) Ltd. v. Cayman Airways, Ltd, 617 F. Supp. 17, 18
(S.D. Fla. 1985). In addition,‘the Second Circuit concluded that
alienage jurisdiction existed over‘a company incorporated in
Bermuda, also a British Dependent Territory. Netherlands
Shipmortgage Corp. v. Madias, 717 F.2d 731, 735 (2d Cir.
1983); see also British Nationality Act 1981, 31 Halsbury’s
Statutes 172 (4th ed. 1987) (Bermuda identified as a British
Dependent Territory ).

Humphreys relies on one unpublished district court decision
for support of its assertion that alienage jurisdiction does not
apply to this case. St. Germain v. West Bay Leasing, Léd.,
CV-81-3945, order (E.D.N.Y. 1982). That court in fact did
conclude that subject matter jurisdiction was lacking when one
of the parties was a Cayman Islands corporation. The court
relied in part on an earlier decision denying diversity jurisdic-
tion over a business incorporated in Hong Kong, a British

* British Nationality Act 1981, 31 Halsbury’s Statutes 172 (4th ed.
1987).

6a

colony. Windert Watch Co. v. Remex Elecs. Ltd., 468 F. Supp.
1242 (S.D.N.Y. 1979). However, the force of the Windert
decision has been eroded by a more recent case from the same
court. In Tetra Finance (HK) Ltd. v. Shaheen, 584 F. Supp. 847
(S.D.N.Y. 1984), the court noted that corporations should not
be denied access to American courts sumply because of the
status of the country in which they are incorporated. “It would
seem hypertechnical to preclude Hong Kong corporations from
asserting claims in our courts simply because Hong Kong has
not been formally recognized by the United States as a foreign
sovereign in its own right.”” /d. at 848.

We agree with the district court that subject matter jurisdiction
under section 1332 is present. We see no reason to depart from
the weight of authority. Certainly, the exercise of American
judicial authority over the citizens of a British Dependent
Territory implicates this country’s relationship with the United
Kingdom-precisely the raison d’etre for applying alienage juris-
diction. Not applying alienage jurisdiction in this case would
allow “form rather than substance” to govern. Murarka \;
Bachrack Bros., 215 F.2d 547, 552 (2d Cir. 1954) (Harlan, J.).

B. Personal Jurisdiction

In a diversity case, a federal district court has personal juris-
diction over anonresident defendant “only if a court of the state
in which it sits would have such jurisdiction.” Turnock v. Cope,
816 F.2d 332, 334 (7th Cir. 1987). Therefore, review of

* Windert also was a by Judge Kocoras in Creative Dis-
tributors, Ltd. v. Sari Niketan, Inc., Mem. op., 1989 U.S. Dist. LEXIS
10436 at *4 (N.D. Ill. 1989) (finding the reasoning of Tetra Finance
rsuasive), and Judge paonge in Timco Eng'g,Inc.v. Rex & Co., 603

. Supp. 925, 930 n.8 (E.D. Pa. 1985) (same).

In Murarka v. Bachrack Bros., Inc., 215 F.2d 547 (2d Cir. 1954),
the plainuff was a citizen of India who filed his suit while India was
sull a British colony. The defendant claimed that, because India was
not a sovereign nation when the complaint was filed, the court did not
have ee ee ae Then-Judge Harlan determined that the
district court did have jurisdiction, because the United States had
granted de facto recognition of India by accepting an ambassador from
that country. /d. at 552.

5

7a

decisions regarding jurisdiction of a federal court in a diversity
suit requires a two-part inquiry: (1) whether the state statute
allows jurisdiction, and (2) whether the assertion of jurisdiction
complies with constitutional due process standards. See
Heritage House Restaurants, Inc. v. Continental Funding
Group, Inc., 906 F.2d 276, 279 (7th Cir. 1990); John Walker &
Sons, Ltd. v. DeMert & Dougherty, Inc., 821 F.2d 399, 401-02
(7th. Cir. 1987) (Illinois long-arm statute); 4 C. Wright & A.
Miller, Federal Practice and Procedure § 1069 at 347 (1987). In
this case, these twin inquiries collapse into one, because, as this
court has noted, Indiana’s long-arm statute extends personal
jurisdiction to the limit allowed under the due process clause of
the fourteenth amendment. Wallace v. Herron, 778 F.2d 391,
393 (7th Cir. 1985) (and cases cited therein), cert. denied, 475
U.S. 1122 (1986). Accordingly, we shall focus on whether
assertion of jurisdiction in this case violates due process.

Due process requires that the defendant have “minimum
contacts with [the forum] such that the maintenance of the suit
does not offend ‘traditional notions of fair play and substantial
justice.’” International Shoe Co. v. Washington, 326 U.S. 310,
316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463
(1940)); FMC Corp. v. Varonos, 892 F.2d 1308, 1313 (7th Cir.
1990). The minimum contacts must be established by the
purposeful acts of the defendant. Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 475 (1985). Examples of acts that,
depending on the circumstances, might support a determination
of jurisdiction include “designing the product for the market in
the forum State, advertising in the forum State, establishing
channels for providing regular advice to customers in the forum
State, or marketing the product through a distributor who has
agreed to serve as the sales agent in the forum State.” Asahi
Metal Indus. Co. v. Superior Court, 480 U.S. 102, 112 (1987).

There are two types of jurisdiction that can be exercised over
an out-of-state defendant-specific and general. When the
defendant’s activities in the state with respect to the transaction
underlying the litigation serve as the basis for jurisdiction, the
assertion of jurisdiction is said to be “specific.” See Helicop-
teros Nacionales de Columbia v. Hall, 466 U.S. 408, 414 n.8

8a

(1984); Giotis v. Apollo of the Ozarks, Inc., 800 F.2d 660, 666
n.3 (7th Cir. 1986) (discussing difference between general and
specific jurisdiction), cert. denied, 479 U.S. 1092 (1987);
Wallace, 778 F.2d at 393 (same). By contrast, when the
defendant’s overall activity in the state, not simply its actions
with respect to the underlying transaction, are the basis, the
jurisdiction is said to be “general.” See Helicopteros
Nacionales de Colombia, 446 U.S. at 414 n.9.

1. specific jurisdiction over Humphreys

Considering Humphreys first, we shall examine whether the
contacts it had with the state satisfy the assertion of specific
jurisdiction. Jurisdiction based on such contacts comports
with due process only if Humphreys reasonably should have
anticipated being haled into court in Indiana. See Burger King
Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985); World-Wide
Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980); FMC
Corp. v. Varonos, 892 F.2d 1308, 1313 (7th Cir. 1990);
Wallace, 778 F.2d at 393-94. Humphreys must purposefully
have availed itself of the “’privilege of conducting activities’”
in Indiana. Burger King, 471 U.S. at 475 (quoting Hanson v.
Denckla, 357 U.S. 235, 253 (1958)); see also Giotis, 800 F.2d
at 666; Wallace, 778 F.2d at 395.

“Specific jurisdiction turns on a particularized assessment of
the ‘relationship among the defendant, the forum, and the
litigation."” Saylor v. Dyniewski, 836 F.2d 341, 344 (7th Cir.
1988) (quoting Shaffer v. Heitner, 433 U.S. 186, 204 (1977)).
The conduct engaged in by Humphreys in Indiana is certainly
sufficient to satisfy specific jurisdiction. Humphreys advertised
in the state of Indiana, entered into a long-term arrangement
with an Indiana corporation to provide a guaranteed number of
rooms to be used in connection with tour packages that departed
from Indiana, and sent representatives to Indiana to negotiate
the contract. In short, Humphreys established a continuing

® Itis not argued that Humphreys’ business in indiana constitutes “the
kind of continuous and systematic general business contacts,”
Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 416
(1984), necessary for general jurisdiction.

9a

commercial relationship with an Indiana tour company with the
expectation that its service (providing accommodation) would
be purchased by residents of Indiana (and other states). These
contacts convince us that the district court correctly determined
that Humphreys is subject to personal jurisdiction in Indiana.
Humphreys, by its own business conduct, had purposefully
availed itself “of the privilege of conducting activities within
the forum State, thus invoking the benefits and protections of
its laws.” Hanson vy. Denckla, 357 U.S. 235, 253 (1958). It
should have “reasonably anticipate[d] being haled into court
there.” World-Wide Voll.swagen v. Woodson, 444 U.S. at 297;
see Shute v. Carnival Cruise Lines, 897 F.2d 377, 380, 386 (9th
Cir. 1990) (in plaintiff’s personal injury suit, specific jurisdic-
tion over corporation was found where corporation advertised
in forum, sent brochures to forum, solicited business in forum,
and sold tickets on a commission basis through travel agents in
forum) (as amended and refiled); Rainbow Travel Serv., lac. y.
Hilton Hotels Corp., 896 F.2d 1233, 1238 (10th Cir. 1990)
(contacts sufficient to meet due process requirements when
hotel solicited business in forum state, carried out negotiations
there, and sent contracts there for execution); Neiman v. Rudolf
Wolff & Co., 619 F.2d 1189, 1193 (7th Cir.) (personal jurisdic-
tion established where employee of defendant [an English com-
pany] came to forum for a lunch meeting, and meeting
constituted bulk of negotiations that led to formation of contract;
“A defendant’s participation in the state in substantial prelimi-
nary negotiations leading to the contract in issue has been held
a sufficient basis for long-arm jurisdiction.”), cert. denied, 449
U.S. 920 (1980). ’

’ The Neiman court also noted that convenience for the parties is a
factor that is often considered as part of a due process minimum
contacts analysis. In that case, the fact that the defendant was an
English company and that litigation in Illinois might have been incon-
venient was not dispositive, for “it would also be inconvenient for
plaintiff" to sue overseas.” 619 F.2d at 1195 n.8. Because of the
‘purposeful acts” in the forum, the inconvenience did not amount to
denial of due process. /d.

10a

2. general jurisdiction over Holiday Inns

On this record, personal jurisdiction over Holiday Inns must
be based, if at all, on general jurisdiction, because the only
connection Holiday Inns had with the injury was its franchise
arrangement with Humphreys. Jurisdiction based on a party’s
generally affiliating nexus with the state, as previously noted,
does not offend due process when there are “continuous and
systematic general business contacts” of the defendant in the
state. Helicopteros Nacionales de Columbia, 466 U.S. at 416.
“This is a fairly high standard in practice.” Fields v. Sedgwick
Associated Risks Ltd., 796 F.2d 299, 301 (9th Cir. 1986); see
Shute, 897 F.2d at 380-81 (collecting cases). The Wilsons argue
that the Indiana registration act, Indiana Code 23-1-11-6,° is
sufficient to support general jurisdiction. Registering to do
business is a necessary precursor to engaging in business ac-
tivities in the forum state. However, it can not satisfy .. .
standing alone . . . the demands of due process. Such an
interpretation of the Indiana registration statute would render it
constitutionally suspect and, accordingly, we decline to give it
such a reading. Cf. NLRB vy. Catholic Bishops of Chicago, 440
U.S. 490, 500 (1979).

On this record, we cannot determine whether Holiday Inns
had a sufficient level of conduct and activity in Indiana to justify
the characterization “continuous and systematic.” Helicopteros
Nacionales de Colombia, 466 U.S. at 416. Accordingly, we
remand this aspect of the case to the district court for a more
plenary inquiry into the contacts and conduct of Holiday Inns
in Indiana.

C. Forum Non Conveniens

We review under an abuse of discretion standard the district
court’s decision to deny a motion to dismiss for forum non
conveniens. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 257
(1981); FMC Corp. v. Varonos, 892 F.2d 1308, 1314 (7th Cir.
1990). As the Supreme Court has instructed,

® This section was —_ in 1986 and superceded by the —
corporations chapter of the Indiana Code, sections 23-1-49-1 to -10.

lla

[|W Jhere the court has considered all relevant public and
private interest factors, and where its balancing of these
factors is reasonable, its decision deserves substantial
deference.

Piper Aircraft Co., 454 U.S. at 257. Furthermore, the district
court is granted “substantial flexibility” in deciding a forum non
conveniens argument. Van Cauwenberghe v. Biard, 486 U.S.
517, 529 (1988).

“There is ordinarily a strong presumption in favor of the
plaintiff’s choice of forum, which may be overcome only when
the private and public interest factors clearly point towards trial
in the alternative forum.” Macedo v. Boeing Co., 693 F.2d 683,
688 (7th Cir. 1982); see Piper Aircraft Co., 454 U.S. at 255;
Koster v. (American) Lumbermens Mutual Casualty, 330 U.S.
518, 524 (1947); Gulf Oil v. Gilbert, 330 U.S. 501, 508 (1947).
“Courts routinely give less weight to a foreign plaintiff’s choice
of forum. Citizens or residents deserve somewhat more
deference than foreign plaintiffs.” Macedo, 693 F.2d at 688:
see Piper Aircraft, 454 U.S. at 256. Nevertheless, the district
court must be able to police misuse, such as actions brought in
a particular forum to harass a party. There is no rigid test upon
which a district court must focus when analyzing a forum non
conveniens argument, instead, as articulated by the Supreme
Court in Gulf Oil Corp. v. Gilbert, there are seygral public and
private interest factors that may be considered.” Private inter-
ests include

the relative ease of access to sources of proof; availability
of compulsory process for attendance of unwilling, and the
cost of obtaining attendance of willing, witnesses; pos-
sibility of view of premises, if view would be appropriate
tothe action; and all other practical problems that make trial
of a case easy, expeditious and inexpensive. There may also

” The Supreme Court never has ruled whether the criteria governing
the forum non conveniens decision are governed by federal or state
law under the rule of Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938).
See Piper Aircraft Co. v. Reyno, 454 U.S. 235, 248 n.13 (1981).
Because the parties appear to agree that federal and Indiana criteria
are the same, we need not decide the matter. Humphreys’ Br. at 24.

12a

be questions as to the enforceability of a judgment if one is
obtained. The court will weigh relative advantages and
obstacies to fair trial.

330 U.S. at 508. Public interests include judicial administra-
tion, trying cases in a forum that has a relation to the litigation,
and having matters of state law decided by a court sitting in that

state. Jd. at 508-09.

In this case, the district court relied exclusively on the reason-
ing found in Lehman v. Humphrey Cayman, Ltd., 713 F.2d 339
(8th Cir. 1983), cert. denied, 464 U.S. 1042 (1984). We recog-
nize, as did the district court, the substantial similarity between
the forum-related factors present in this suit and those present
in the Lehman suit. As is apparent from the case name, Lehman
involves the same Cayman Islands hotel as is involved here.
Similarly, the injury occurred on the Cayman Islands to a United
States resident who responded to a Humphreys’ advertisement
in the United States. The Eighth Circuit evaluated many of the
Gilbert factors. The court first determined that the location of
witnesses in the Cayman Islands did not militate strongly for
applying forum non conveniens, because many of the witnesses
were Holiday Inns employees (thus enabling Humphreys to
obtain their cooperation in travelling to testify), and other modes
of obtaining the evidence-such as admissions and depositicns-
could be used. Lehman, 713 F.2d at 343. The court also
concluded that Iowa and the United States had an interest in the
suit because the injured party was an Iowa resident and had
made the travel arrangements in lowa. /d. at 344. The Eighth
Circuit placed sorne weight on the fact that the procedures for
litigating in the Cayman Islands would disadvantage the plain-
tiff. Attorneys there do not accept work for contingent fee
arrangements; it is likely that the plaintiff could not receive a
jury trial for her injury action; and she would have been requirea
to post a $1,000 bond with the court because she was a foreigner.
Id. at 345-46. Accordingly, the Eighth Circuit determined that
the district court abused its discretion in dismissing the action
on the ground of forum non conveniens. Id. at 347.

We cannot say that the district court abused its discretion in
declining to dismiss the suit. Great weight must be given the

13a

Wilsons’ choice of forum. The inconvenience for Humphreys
of litigating the case in Indiana must be balanced against the
disadvantagequs procedures available in the Cayman Islands for
the Wilsons, ~ the interest of Indiana in providing a remedy for
an injury stemming from a tour booked in Indiana for a group
that left from Indiana, and the hardships that the Wilsons would
encounter in litigating a case at such a great distance from their
home. For these reasons, we conclude that the district court did
not abuse its discretion in denying the forum non conveniens
motion.

Conclusion

For the foregoing reasons, we affirm the orders of the district
court regarding Humphreys, but remand to the district court for
further consideration on whether Holiday Inns has subjected
itself to general jurisdiction in Indiana.

AFFIRMED IN PART AND REMANDED

WILL, Senior District Judge, concurring in part and dissenting
in part. I concur in the remand as to Holiday Inns. I dissent,
however, from the assertion of “specific” jurisdiction over
Humphreys and from the majority's affirmance that Indiana is
a proper forum.

The Wilsons are residents of Illinois. Their trip to the
Caymans was a gift from their son. He planned it and paid for
it. Neither the son nor the Wilsons had any contacts with
Humphreys, in Indiana or anywhere else in the United States.
He booked the trip through American, and there is no evidence
that he waéirfluenced in any way by anything Humphreys said
or did, that he selected Humphreys or even knew that it was to
be the hotel. In fact, the record is clear, as the majority recog-
nizes, that “arrangements for the trip were made as a result of

10 We recognize that, to the extent these disadvantages are grounded
in differences in the substantive law of the Cayman Islands, they may
be given some, but not substantial or conclusive, weight. See Piper
Aircraft Co. v. Reyno, 454 U.S. 235, 247 (1981); Macedo y. Boeing
Co., 693 F.2d 683, 688 (7th Cir. 1982).

l4a

advertisements for the tour that appeared in American’s travel
bulletin. Arrangements were made with American’s tour sub-
sidiary, Ambassadair, and payment was made to Ambassadair
.... Majority op. at 3.

I. Personal Jurisdiction

Jurisdiction over an unwilling, non-resident defendant con-
forms to the requirements of due process only if the
“defendant’s conduct and connection with the forum State are
such that he should reasonably anticipate being haled into court
there.” World-Wide Volkswagen Corp. v. Woodson, 444 US.
286, 297 (1980). A defendant who has “purposefully estab-
lished ‘minimum contacts’ in the forum State” has unpliedly
submitted to jurisdiction in the forum. Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 474 (1985). But merely “‘random,’
‘fortuitous,’ or ‘attenuated’” contacts with a forum are not
enough. /d. at 475. Further, any “assertion of personal juris-
diction [must] comport with ‘fair play and substantial justice.*”
Id. at 476, quoting /nternational Shoe Co. v. Washington, 326
U.S. 310 (1945). And, finally, in the special case of “specific”
jurisdiction, a defendant’s contacts with the forum serve as a
basis for personal jurisdiction only for suits “arising out of or
related to” those contacts. Helicopteros Nacionales de Colom-
bia v. Hall, 466 U.S. 408, 414 n.8 (1984).

Humphreys here had no purposeful contacts with the plain-
tiffs or with Indiana related to this suit, which arises from
acts and events that took place entirely in the Cayman Is-
lands. Humphreys could not reasonably have anticipated
being haled into court in Indiana, and forcing Humphreys to
defend this ca%e in an Indiana courtroom is far from fair or
substantially just.

Any and all contacts with the Wilsons’ son in Indiana
related to this lawsuit were American’s, not Humphreys’,
and American admittedly did not act as Humphreys’ agent.
American had no authority to confirm reservations and bind

15a

Humphreys and it did not purport to do so. American,had to
suomit all reservations to Humphreys for confirmation.

I can understand how Humphreys could reasonably have
expected to be haled into an Indiana court, state or federal, to
resolve a dispute arising from its contract with American Trans
Air, which contract was negotiated in Indiana, or if it had sold
products in Indiana. But this case arises from a dispute between
Humphreys and the Wilsons, not Humphreys and American.
Humphreys did not sell products in Indiana, and Humphreys
had no contacts whatsoever with the Wilsons in Indiana or
any where else in the United States.

The majority's suggestion that Indiana courts have jurisdic-
tion here because “Humphreys established a continuing com-
mercial relationship with an Indiana tour company with the
expectations inat its services would be purchased by residents
of Indiana (and other states),” majority op. at 9, and
“Humphreys reasonably should have anticipated being haled
into court in Indiana,” id. at 8, strikes me as wholly inconsistent
with the facts as well as the requirements of due process.

Humphreys undoubtedly serves hundreds or even thousands
of U.S. tourist guests each year as the result of reservations made
by American and other U.S. tour operators and travel agencies.
Every U.S. tour organizer or travel agency has innumerable
foreign hotels, bus lines, guide services, etc., with which it
maintains continuing commercial arrangements. It would be
surprising, however, if Humphreys or any other foreign service

' See Fordyce v. Round Hill Developments, Ltd., 585 F.2d 30 (2¢ Cir.
1978) (Jamaican hotel did not subject itself to jurisdiction of New York
courts by contracting with a travel agent, where the travel agent was
an independent contractor which leased rooms from the hotel at its
own risk); Kopolowitz v. Deepdene Hotel & Tennis Club, 464 F. Supp.
677 (S.D.N.Y. 1979) (Bermuda hotel did not submit to jurisdiction of
New York courts by engaging a sales representative to promote the
hotel and handle inquiries and requests for reservations, in New York
and elsewhere in the United States, where the sales representative did
not have the power to confirm reservations). Compare Gelfand v.
Tanner Motors Tours, Ltd., 385 F.2d 116 (2d Cir. 1967) (involving a
nonforum defendant whose agent in New York had power to confirm
reservations).

l6a

provider anticipated that, merely as a result of its contacts with
U.S. travel agents and without more, it might wind up defending
lawsuits brought by its U.S. guests in U.S. courts.

To hold, as the majority does today, that Indiana courts may
properly exercise in personam jurisdiction over Humphreys is
to hold that any foreign hotel, restaurant, museum or other
facility or service provider, which confirms reservations for
U.S. travel agents and tour operators and compensates those
travel agents and tour operators for arranging reservations (a
frequent and typical practice), is subject to the jurisdiction of
U.S. courts and should‘expect to be haled into them to
defend ‘tort suits or any other claims brought by U.S. guests.
This, notwithstanding that the hotel or other service provider
has had no dealings with the guest in any U.S. forum, that there
was no principal/agent relationship between it and the travel
agent or tour operator with whom the guest solely dealt, and
even though all the acts and events alleged in the guest’s
complaint occurred in Timbuktu, Bali, Japan, Australia, Major-
ca, Tahiti or where-have-you, where, in addition, all the wit-
nesses and relevant records are located.

The kind of global long-arm jurisdiction which the majority
endorses, in my opinion, both fails the minimum contacts test
and is at odds with the fundamental due process requirement
that jurisdiction comport with “fair play and substantial justice.”
I believe that compelling Humphreys to litigate in Indiana is
unanticipated, unfair and beyond the bounds of due process. Cf.
Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 114
(1987) (“The unique burdens placed upon one who must defend
oneself in a foreign legal system should have significant weight
in assessing the reasonableness of stretching the long arm of
personal jurisdiction over national borders.”).

II. Forum Non Conveniens

In addition to holding that Indiana’s long-arm statute reaches
Humphreys, the majority also finds, as did the Eighth Circuit,
in Lehman v. Humphrey Cayman, Ltd., 713 F.2d 339 (8th Cir.
1983), that the fact that the hotel and all the witnesses are located
in the Cayman Island, where all the events giving rise to this

17a

case took place, is outweighed by other considerations Such as
_ the allegedly limited availability of contingent fee arrangements
and jury trials in the Cayman Islands, the necessity of a bond,
the plaintiffs prerogative to choose their forum, and the hardship
for the plaintiffs of litigating in the Cayman Islands (where their
alleged cause of action arose). I respectfully disagree.

There are a number of serious problems with trying this case
in Indiana. First, the site of the alleged tort, the defendant, all
the witnesses other than the plaintiffs and all the records are in
the Cayman Islands. The inconvenience to Humphreys far
outweighs any inconvenience to the Wilsons to try the case
where it arose.

Second, Indiana citizens undoubtedly have an interest in a
convenient home forum. And, if due process perniits, Indiana
may have an interest in providing such a forum for its citizens
who choose to litigate there. But it is difficult to conceive of
what real interest either Indiana or its citizens have in this case.
The Wilsons are citizens of ///inois. In Lehman, by contrast, the
plaintiffs were, at least, citizens of the forum state.

Third, while it would undoubtedly be to the Wilsons’ ad-
vantage to try this case under Indiana law (and before an Indiana
jury )-which is, presumably, why they chose to file it there-the
differences the parties have identified between Indiana law and
the law of the Cayman Islands are not in themselves a justifica-
tion either for Indiana courts to assert due process long-arm
jurisdiction or for finding that the balance ot inconvenience in
this case favors an Indiana trial. Both the majority and the
district court have given too much weight to these differences.
“The possibility of a change in substantive law should ordinarily
not be given conclusive or even substantial weight in the forum
non conveniens inquiry.” Piper Aircraft Co. v. Reyno, 454 U.S.
235, 247 (1981) (availability of strict liability in Pennsylvania
but not in Scotland did not, by itself, bar dismissal for forum
non conveniens). See also id. at 252 n.19.

I would note, in addition, that although the Wilsons have
apparently been assuming that in Indiana, local law would
apply, that may or may not be true. Although the majority does
not discuss the issue, it is an important conflict of laws question,

18a

and possibly a difficult one, whether Cayman Islands or Indiana
law should govem at trial. See Piper Aircraft, 454 U.S. at 251
(“The doctrine of forum non conveniens . . . is designed in part
to help courts avoid conducting complex exercises in compara-
tive law.”). The answer to that question, which depends on
Indiana’s choice-of-law rules, may determine not only the ap-
plicable law of liability and the right to a jury but also Mr.
Wilson’s right to sue. If the majority is holding, as it seems to
suggest by referring to trial by jury, not only that Indiana courts
have jurisdiction but also that Indiana substantive law applies,
then I believe the opinion ought not to assume it, but should say
so and explain why.

A fourth problem with allowing this case to proceed in Indiana
is that it is likewise unclear and troubling to me how an Indiana
judgment against Humphreys, should that be the outcome,
would be enforced-an issue which, again, the majority ’s opinion
overlooks. I would certainly hope that Humphreys, desiring to
continue to attract U.S. tourists, would recognize and respond
to any judgment that might be entered against it. But asserting
jurisdiction over and entering judgments against foreign en-
tities, many of whom have no assets in the United States, is at
best a speculative practice.

lil. Conclusion

It is worth noting the probable consequences of the majority’s
decision. Many Americans are frequent foreign travelers. If
U.S. courts have jurisdiction every time an American tourist has
a dispute with a foreign service provider which has an ongoing
contact with an American tour organizer or travel agent, we are
going to see a lot more lawsuits such as this one, and foreign
service providers will likely protect themselves from their in-
creased exposure by charging higher rates and/or insisting on
exculpatory provisions in their contracts with Americans.

I recognize that finding no U.S. jurisdiction in cases like this
might require American travelers like Mrs. Wilson to return to
places where they have had traumatic experiences in order to

19a

pursue remedies for aileged wrongs. Those are not considera-
tions, however, that are relevant to jurisdiction, which can only
be stretched so far as due process allows and has, I believe, been
stretched far too far in this case.

It is undisputed that U.S. tourists traveling voluntarily in
foreign countries are subject to the laws and jurisdiction of the
courts of those countries. Consistent with that principle, the
long-arm jurisdiction of the fifty states cannot be applied global-
ly so as to give U.S. courts specific jurisdiction over foreign
defendants in tort cases arising from events that took place
entirely on foreign soil and are unrelated to the defendants’
contacts with any U.S. forum.

Believing that the bounds of due process have been far ex-
ceeded in this case, I would reverse the finding of jurisdiction
as to Humphreys. I believe, in addition, that denying
Humphreys’ motion for a dismissal for forum non conveniens
constituted an abuse of discretion and would also reverse on that
basis, even if Humphreys’ contacts vith Indiana satisfied due
process. I concur, however, with the majority's conclusions as
to Holiday Inns.

A true Copy:
Teste:

Clerk of the United States Court of
Appeals for the Seventh Circuit

20a

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION

DOROTHY A. WILSON and
LOUIE P. WILSON,

Plaintiffs,

v. CAUSE NO. IP 86-197-C

HOLIDAY INNS, INC.,
HUMPHREYS (CAYMAN), LTD.
and AMERICAN TRANS AIR, INC.,

Defendants.

ENTRY

This case now pends before the Court on dispositive motions
filed by the defendants. Humphreys (Cayman) Ltd. and Holiday
Inns, Inc. have filed motions to dismiss the complaint on grounds
of lack of personal jurisdiction and on grounds of forum non
conveniens. Defendant American Trans Air, Inc. has filed a
motion for summary judgment addressed to those aspects of
plaintiffs’ complaint alleging that it has breached a duty to the
plaintiffs.

Plaintiffs in their motion in opposition to the motions of
Humphreys (Cayman) Ltd. and Holidays Inns, Inc. have set out the
facts upon which they rely in their opposition to the defendants’
motions.

The Court for purposes of all pending motions will adopt the
plaintiffs’ statement of the facts as true.

2la

STATEMENT OF FACTS

Humphreys (Cayman) Ltd. is incorporated under the laws of
the Cayman Islands, having its principal place of business in
Georgetown, Grand Cayman, Cayman Islands, British West Indies.
Humphreys maintain a corporate office and U.S. reservations
office in Memphis, Tennessee, where many of its business records
concerning the hotel are maintained, and has maintained a
reservations office in Miami, Florida. Humphreys is a licensee of
Holiday Inns, Inc. under a license agreement dated November 23,
1970, and the motel operated by Humphreys in the Cayman Islands
is operated as a Holiday Inn under that license agreement.
(Verified statement of D. Glynne Owen, filed May 9, 1986;
Holiday Inns’ answers to interrogatories 1 and 2.) Holiday Inns,
Inc. is a Tennessee corporation registered to do business in Indiana.
(Par. 3, Holiday Inns’ answer to Complaint.) Since at least 1976,
Humphreys has entered into arrangements with American Trans
Air (American) to provide accommodations for tours offered by
American. (American’s answer to interrogatory 1.) American is
incorporated under the laws of the State of Indiana, and has its
principle place of business in the State of Indiana. (Par. 5,
American's answer to Complaint.)

Ambassadair Travel Club, Inc., a subsidiary of American (See
Ambassadair Newsletter, September, 1984, General Information)
publishes a monthly newsletter which is distributed to each
member of Ambassadair. The tour by Ambassadair scheduled for
the Cayman Islands at which accommodations were offered at
Humphreys and in which plaintiffs participated was advertised in
the newsletters.

Reservations with Humphreys are made by both telephone and
correspondence between American or Ambassadair in
Indianapolis, Indiana and Humphreys in Memphis, Tennessee.

Payments fer accommodations are sometimes mailed from
Indianapolis to Humphreys’ office in Memphis and sometimes paid
to Humphreys at the hotel. (Richards deposition, pp. 43-48.)

22a

Officers of Humphreys have come to Indianapolis to meet with
representatives of American on several occasions for the purpose
of transacting general business between the parties. Contracts
between American and Humphreys are negotiated periodically,
usually a year in advance. The negotiated contracts, which appear
to be at least partially oral, include negotiated rates, guaranteed
room availability, minimum numbers of guests for Humphreys,
commission rates payable to American or net rates for rooms to be
charged to American, and free accommodations available to
American’s personnel accompanying the tour. (American’s
answer to interrogatory 3; Richards deposition pp. 31-33, 37-40;
Humphreys’ answer to interrogatory 7.) Copies of the monthly
newsletters produced by American in response to plaintiffs’ request
for documents show that since 1978, advertisements for 131 tours
specifically offering accommodations at Humphreys’ Holiday Inn
have been published, and tours to the Cayman Islands are now
offered by American as frequently as two or three times a month
(Richards deposition, p. 40). In addition to including specific
advertisements of Humphreys’ Holiday Inn in the tour listing,
additional advertisements are published in the bulletins for the
Cayman Islands tours which include solicitation of
accommodations at Humphreys’ hotel.

American obtains information for the advertisements of the
Holiday Inn operated by Humphreys from brochures furnished by
Humphreys. While Humphreys has not specifically requested
these advertisements, they are done with Humphreys’ knowledge
and encouragement. (Richards deposition, pp. 41, 55-6;
Humphreys’ answers to interrogatory 4 and 3(b)(il).)

Humphreys advertises and publicizes its hotel through
advertisements in national magazines, such as Travel Agent and
Travel Weekly, Bride’s Magazine and Skin Diver, as well as in
various directories such as the Holiday Inn directory, the Holiday
Travel Index and similar directories. In addition, Humphreys mails
brochures, rate cards and other promotional materials to travel

23a

agents generally, and has mailed such material to American and
Ambassadair, knowing that they would be circulated to
Ambassadair’s membership. Humphreys’ concedes that “‘it is
probable that some or all of these advertisements, listings and
related materials were sent or made available to persons or entities
in Indiana”. (Humphreys’ answer to interrogatory 4.)

Humphreys also advertises in newspapers, some of which,
such as the Chicago Tribune, Humphreys concedes “were probably
seen in Indiana by Indiana subscribers to those newspapers”.
(Humphreys’ answer to interrogatory 4.) Humphreys also
maintains nationwide toll free numbers to be used by residents of
Indiana and other states for the purpose of making reservations.
All of these promotional activities are done purposefully by
Humphreys to obtain business for its hotel. “Through its
advertising and promotionai activities, Humphreys obviously
encourages the intermediaries to place reservations on their own
behalf or un behalf of their clients with Humphreys’ hotel.”
(Humphreys’ answer to interrogatory 3(b)(1i).)

Humphreys’ promotional activities directed to the Indiana
market have certainly been successful. Records produced by
Humphreys include checks issued by Ambassadair between
December 21, 1982 and March 25, 1986, totalling $239,810.76.

The plaintiffs were participants in the American tour to the
Cayman Islands from October 28 through November 4, 1984. The
tour was advertised in the September, 1984 Newsletter. Both the
tour listing and the advertisement for the Cayman Island trip
included references to accommodations at the Holiday Inn.

Plaintiffs’ reservations at Humphreys were made through
American at Indianapolis, plaintiffs paid Ambassadair at
Indianapolis for the accommodations at Humphreys and plaintiffs
embarked on their tour at Indianapolis International Airport.
Dorothy Wilson was attacked in her room at the hotel operated by
Humphreys on the second day after her arrival. After spending a
week in the hospital on the Cayman Islands she returned to

24a

Indianapolis and received additional medical treatment at
Methodist Hospital.

In addition to those facts plaintiffs’ affidavit of October 9,
1986 will be taken as true for the purposes of the pending motions.
That affidavit alleges that the plaintiffs were residents of Hlinois. It
avers further that plaintiffs received an advertisement for a
Cayman Islands tour in the September, 1984, Ambassadair travel
club bulletin. The Wilsons then made arrangements through
Ambassadair to stay at the Holiday Inn in the Cayman Islands
operated under license by Humphreys (Cayman) Ltd. Plaintiffs
urge that American Trans Air, Inc. is a tour operator and as such
owed a duty to its patrons to investigate proposed accommodations
for safety and to warn the plaintiffs of any dangerous conditions
discovered from such an investigation. This duty, according to
plaintiffs, sounds both in tort and contract. The tort duty requires
American to reasonably inspect facilities and warn of any
dangerous conditions that might affect guests. The contract duty
arising under the contract between the tour operator and the patron
gives the defendant airline duties of an innkeeper to the plaintiffs.

There are several cases from across the United States that deal
with the issue of a travel agent's liability for injury to its patrons
while on a tour it sold or arranged. See Annotation, Liabili ity of
Travel Agents for Injuries on Tour, 53 A.L.R. 3d 1310 (1973 and
supplement 1987). These cases generally illustrate a trend refusing
to impose liability on travel agents for injuries to patrons regardless
of the theories advanced by the plaintiffs, the injured patrons.
Plaintiffs rely on exceptions to this general trend.

Plaintiffs cite both Stevenson v. Four Winds Travel, Inc., 462

F.2d 899 (Sth Cir. 1972) and Taylor v, Costa Lines, Inc,, 441
F.Supp. 783 (E.D.Pa. 1977) for the proposition that tour organizers

have a duty to warn tour participants of dangerous conditions they
might encounter during the tour. The Stevenson case recognizes
that under the law of the state of Florida the duty of a travel agency
to warn tour guests of conditions during the tour might arise by

25a

reason of a contractual relationship between the travel agency and
the patron. The terms of that contractual relationship would be
found in representations and statements made to the tour guest in
the brochure prepared by the travel agency. Jn the Stevenson case,
the Four Winds Travel, Inc. brochure contained phrases from
which reasonable individuals could conclude that Four Winds was
accepting responsibility for accidents to its patrons. Four Winds
put in its brochure statements regarding its tour escorts and
directors having been carefully selected and trained, that these
escorts were experienced and indicating the many services these
tour escorts or directors would render to members of their tours.
Reasonable individuals might conclude that the plaintiff in
Stevenson had the right to expect that the defendant would warn
her of any danger involved in a tour.

The Taylor v, Costa Lines, Inc,, supra, case involved the
relationship of an off-ship tour guide to the owners of a cruise ship.
Any liability for defendant cruise ship was contractual and arose
from oral statements and written representations of the cruise ship
einployees. Plaintiffs alleged that defendant made statements
regarding the quality of the tour guides. Reasonable individuals
might conclude on the basis of these representations that plaintiff
should have been warned of dangers.

Plaintiffs direct our attention to the contractual language in the
instant case upon which they rely in arguing that the Airlines owed
them a duty to warn of safety problems at the hotel. The brochure
in the case at hand contains the representations made to the
plaintiffs by the defendant Airline regarding its responsibility. The
pertinent paragraph reads as follows:

“This tour program is planned and operated by American
Trans Air, Inc., 214i South Highschool Road,
Indianapolis, Indiana, 46251, as principle and tour
operator. Ambassadair Travel Club is wholly owned by
Ambassadair Travel Club, Inc., an Indiana corporation
which is a subsidiary of American Trans Aur, Ine.
American Trans Air is responsible for making all

26a

arrangements for transportation, provided that in the
absence of negligence on the part of American Trans Air,

to any assumption of
liability for any personal injury or property damage arising
out of or caused by any negligent act on the part of any

hotel, other air carrier or anyone rendering any of the

services or accommodations being offered in connection

with this public charter.” [Our emphasis. |
There are no other statements or representations in the brochure or
anywhere else allegedly received by the plaintiffs in this case. This
paragraph is the only language relied upon by plaintiffs to estabiish
a duty. This paragraph in the view of this Court rather than
establishing a duty is a clear disclaimer by American of any duty to
plaintiffs in this case once plaintiffs have deplaned. Therefore,
unless this paragraph is ineffective for some public policy reason
the lack of duty of American Trans Air to plaintiffs for the accident
in question is apparent.

Plaintiffs point out that the entire relationship between the
plaintiffs and American Trans Air, Inc. arose out of the contract
between them by which the plaintiffs became members of the tour.
Plaintiffs cite the above quoted portion of the brochure in support
of their own view that American Trans Air, Inc. was a principal

and tour operator. Plaintiffs further cite Requirements Applicable
to Public Charter Operators, 14 C.F.R. 380.32(x)(1987), which

provides in part:

“Contracts between charter operators and charter

participants shall state:...(x) that the charter operator is the

principal and is responsible to participants for all services

and accommodations offered in connection with the

charter...”
Plaintiffs urge that this quotation coupled with the above cited
paragraph from the brochure indicate defendant's affirmative duty
to the plaintiffs.

Defendant, however, points out the remaining portion of the
C.F.R. citation as follows:

27a

“However, the contract may expressly provide that the

charter operator, unless he is negligent, is not responsible

for personal injury or property damage caused by any

direct air carrier, hotel or other supplier of services in

connection with the charter.” Id.

Certainly, the paragraph quoted from the brochure indicates
American Trans Air's recognition of this permissible language and
implements that permissible language in its notice to the patron that
American Trans Air is not responsible for any personal injury or
property damage arising out of or caused by any negligent act on
the part of any hotel.

The case of Connolly v. Samuelson, 671 F.Supp. 1312 (D.Kan.
1987) dealt with many of the same issues as those presently before
the Court. The court therein, after reviewing current trends and
citing cases from across the country, concluded that the majority of
cases refused to impose liability on travel agents for injuries
suffered by tourists while on the tours sold to them by the travel
agencies. The Connolly case additionally dealt with an
exculpatory clause from the defendant Samuelson’s brochure.

That clause, similar to the one contained in the brochure in the
instant case, indicated that the travel agency would “assume no
liability for injury, damage, loss, accident, delay or irregularity...
for any reason whatsoever”. The Connolly court therefore found
against the plaintiff and in favor of the travel agent for two reasons:
1) the travel agent had no duty, and, 2) even if a duty could be
found the exculpatory clause in the brochure would have relieved
the travel agent of discharging that duty. No distinction was made
in the Connolly case between a travel agent and travel agencies.
There seems to be no reason to treat agents and agencies
differently in terms of duty. Applicability of the Connolly case to
the case at bar seems factually compelling.

The case of Lavine v. General Mills, Inc., 519 F.Supp. 332

(N.D. Ga. 1981) also dealt with this same issue. The travel agency
in that case had a similar clause in its brochure showing that they

28a

undertook no warranty or contractual guarantee of plaintiff's safety
on the cruise. The Lavine case cites the case of Raskin v. Ulysses
Lines, Lid., No. Civ. 4275 (HFW)(S.D.N.Y. Sept. 10, 1980) as
support for its finding. In the Raskin case the plaintiff sought to
recover for injuries she suffered while a ship passenger. It appears
that the plaintiff fell and was injured aboard a ship while it was
docked in Rumania. That plaintiff sued the ship’s owner and
operator and also the travel agent who sold her the cruise. The
Raskin court granted summary judgment in favor of the travel
agent, holding that:

“plaintiff's claims of negligence and unseaworthiness
against the travel agent must fail since it did not own,
operate or manage the vessel. With respect to plaintiff's
third cause of action that [the defendant] was negligent in
investigating the ship’s safety, the court stated that [the
defendant] as a travel agency ‘did not stand in a
relationship vis-a-vis plaintiff such as to owe a duty to her
to investigate the safety of the vessel. Defendant agreed to
arrange a tour and supply a ticket to plaintiff. It did not
insure her safety aboard the vessel.’ The [Raskin] court
also disposed of plaintiff's contentions that Sovereign’s
brochure expressly warranted the vessel’s safety and
seaworthiness by ruling that statements that the vessel
meets certain safety standards ‘falls woefully short of
imposing liability upon [the defendant] for a of
express warranty...’ See also rv

Airways Corp., 60 A.B.2d 427, 401 N.Y.S.2d 91 (2d Dept.
1978).” Lavine, 519 F.Supp. at 337.

These latter cases are strikingly similar to the one at hand.
Plainly American Trans Air does not own, operate or manage the
Holiday Inn. American Trans Air does not stand in a relationship
vis-a-vis plaintiff such as to owe her a duty to investigate the safety
of the hotel. Defendant American Trans Air at no time expressly
or contractually warranted plaintiffs’ safety. The tour brochure
expressly provides to the contrary. Defendant American Trans Air,
Inc.’s motion for summary judgment is GRANTED.

29a

For the purposes of the remaining motions to dismiss, the
Court will again treat as true the statement of the facts set out
earlier in this opinion. Holiday Inns, Inc. and Humphreys
(Cayman) Ltd. have both filed motions to dismiss based on lack of
personal jurisdiction on the grounds of forum non conveniens.
Humphreys further has filed a motion to dismiss for lack of subject
matter jurisdiction, which motion the Court will next undertake.

The defendant Humphreys asserts that jurisdiction of the
subject matter is lacking in this case. Humphreys as a corporation
incorporated under the laws of the Cayman Islands, having its
principal place of business in Georgetown, Grand Cayman,
Cayman Islands, British West Indies, is not a foreign state for
purposes of federal diversity jurisdiction says the defendant.
Defendant cites the case of St. Germain v. West Bay Leasing, Lid.,
No.CV-81-3945 (E.D.N.Y. Sept. 28, 1982) for that proposition.
That case does indeed hold that the Cayman Islands is not a
“foreign state” for purposes of diversity. Plaintiffs however cite
the cases of Bally Export Corporation v, Balicar, Ltd., 804 F.2d
398 (7th Cir. 1986); David H, Elliott, Inc. v iliti
Co,, Lid,, 513 F.2d 1176 (6th Cir. 1975); Rolls Royce (Canada),
Lid. v. Cayman Airways, Lid,, 617 F.Supp. 17 (N.D. Fla. 1985);
and Lehman v. Humphrey Cayman, Ltd., F.2d 339 (8th Cir. 1983),
all in opposition to the defendant’s position.

The Bally Export Corporation case indicates that the federal
court’s jurisdiction was based on diversity of citizenship under 28
U.S.C. § 1332. 804 F.2d at 399. The defendant Balicar, Ltd. was a
corporation organized under the laws of Cayman, a part of the
British West Indies, with its principal place of business in
Georgetown, Grand Cayman, British West Indies, just as the
defendant in the instant action. Default judgment had been entered
against defendant Balicar, Lid. and an issue on appeal was the
question of jurisdiction. The case involved personal jurisdiction
rather than subject matter jurisdiction, and does not in fact discuss
subject matter jurisdiction aithough subject matter jurisdiction

30a

under the rules is certainly an issue that can be brought up at any
time. If the Seventh Circuit had felt that it were an issue it
certainly would have raised it.

The Elliott v, Caribbean Utilities Company, Ltd. case from the
Sixth Circuit also dealt with personal jurisdiction rather than
subject matter jurisdiction regarding a Cayman Islands corporation.
Certainly the opportunity there was present to deal with subject
matter jurisdiction and the Court instead accepted subject matter
jurisdiction and exercised personal jurisdiction. The Rolls Royce
v. Cayman Airways case from the Southern District of Florida
specifically held that subject matter jurisdiction was available even
though under the facts of that case a motion to dismiss for forum
non conveniens was granted.

The Lehman v. Humphrey Cayman Ltd. case is strikingly
similar to the case at hand. Therein, the Eighth Circuit found that
the Federal Court of the Northern District of lowa could exercise
personal jurisdiction over Humphrey Cayman, Ltd. in a matter
involving an alleged tort on an Iowa guest at the Grand Caymanian
Holiday Inn. It appears that the only precedent for the defendant's
subject matter jurisdiction position is the St. Germain case
previously cited. The Court finds the cases cited by the plaintiffs
to be more persuasive and follows those precedents rather than the
St. Germain precedent. The Court therefore OVERRULES
defendant Humphreys’ motion to dismiss for lack of subject matter
jurisdiction.

There remains the defendants’ motion to dismiss for lack of
personal jurisdiction. Both defendants Holiday Inns, Inc. and
Humphreys (Cayman) Ltd. assert that the incident in question and
the events surrounding the incident do not confer jurisdiction on
the Southern District of Indiana. It is by now no mystery that the
Indiana long-arm statute, codified as Indiana Trial Rule 4.4 (West
1985) extends personal jurisdiction of the Court sitting in Indiana
including federal courts to the limits permitted under the due
process clause of the Fourteenth Amendment. First National Bank

3la

of Louisville v, Bezema, 569 F.Supp. 818, 819 (S.D. Ind. 1983);
Oddi v. Mariner-Denver, Inc., 461 F.Supp 306, 308 (S.D. Ind.
1978); Wallace vy, Herron, 778 F.2d 391 (7th Cir. 1985). Thus, the
inquiry into the matter is whether the district court could consistent
with due process assert personal jurisdiction over Humphreys and
Holiday Inns.

It is often cited that International Shoe Company v.
Washington, 326 U.S. 310, 316 (1945) holds that due process
requires that the defendant have “certain minimal contacts with
[the forum] such that the maintenance of the suit does not offend
traditional notions of fair play and substantial justice’”. The
Supreme Court has further defined those “minimal contacts” to be
“continuous and systematic... activities” in the forum. Perkins v.
Benguet Consolidated Mining Co., 342 U.S. 437, 444 (1952).
More contemporaneously the Supreme Court stated in Burger King
Corp. v. Rudzewicz, 471 U.S. 462 (1985): ‘The constitutional
touchstone remains whether the defendant purposefully established
"minimum contacts in the forum state’”. Id. at 474. In Worldwide
Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980) the Court
held that the defendant’s conduct and connection with the forum
state should be such that the defendant would reasonably anticipate
being subjected to the jurisdiction of the forum court. Id. at 297.

In the case of Asahi Metal Industry Company, Lid, v. Superior
Court of California, 107 S.Ct. 1026 (1987) we find the following
quotation:

“The placement of a product into the stream of commerce
without more is not an act of the defendant purposefully
directed toward the forum State. Additional conduct of the
defendant may indicate an intent or purpose to serve the
market in the forum State, for example, designing the
product for the market in the forum State, advertising in
the forum State, establishing channels for providing
regular advice to customers in the forum State, or
marketing the product through a distributor who has agreed
to serve as a sales agent in the forum State.” Id. at 1033.

32a

We find also in the Asahi case a focus on the contacts of the
defendant with the forum State. ‘The ‘substantial connection’...
between the defendant and the forum state necessary for a finding
of minimum contacts must come about by an action of the
p.” 107

S.Ct. at 1 1033. (Emphasis! in prone i citations omitted. )
The Court is mindful that the plaintiff in this case is not a
resident of the state of Indiana. Plaintiffs’ contacts with the State

are through the defendant America Trans Air, Inc. and its
relationship to the other two defendants. In Keeton v. Hustler
Magazine, Inc., 465 U.S. 770, 779-80 (1984), the Supreme Court
said:

“But we have not to date required a plaintiff to have
‘minimum contacts’ with the forum State before permitiing
that State to assert personal jurisdiction over a non-resident
defendant. On the contrary, we have upheld the assertion
of jurisdiction where such contacts were entirely lacking.

In Perkins v, Benguet Mining Co., 342 U.S. 437 (1952)
none of the parties was a resident of the forum State;
indeed, neither the plaintiff nor the subject matter of his
action had any relation to that State. Jurisdiction was
based solely on the fact that the defendant corporation b- 1
been carrying on in the forum ’a continuous and systematic
but limited part of its general business’. In the instant case
respondent’s activities in the forum State may not be so
substantial as to support jurisdiction or a cause of action
unrelated to those activities. But respondent is carrying on
“part of its general business“ in New Hampshire, and that
is sufficient to support jurisdiction when the cause of
action arises out of the very activity being conducted, in
part, in New Hampshire.” Id. at 438.

Also, the Keeton court stated:

“plaintiff's residence in the forum State is not a separate
requirement and the lack of residence will not defeat
jurisdiction established on the basis of defendant's
contacts”. Id. at 780.

33a

As we deal in this case with both Holiday Inns, Inc. and
Humphreys, Rush v. Savchuk, 444 U.S. 320, 332 (1980), reminds
us that: “The requirements of International Shoe... must be met as
to each defendant over whom a siate court exercises jurisdiction”.
And, finally, in Burger King, the Supreme Court cautions us that:
“Minimum requirements inherent in the concept of ’fair play and
substantial justice’ may defeat the reasonableness of jurisdiction
even if the defendant has purposefully engaged in forum
activities”. 471 U.S. at 477-78.

As we begin our analysis of the particular facts in the instant
case it is then extremely important that we focus on whether the
defendants have been carrying on in the forum a continuous and
systematic part of their general business, intending to serve the
market in the forum state so that the defendant should reasonably
anticipate being hailed into court in Indiana. Both sides cite
authority for their respective positions on jurisdiction. The Court
will turn first to those citations of the defendants.

Defendants cite the case of Oddi v. Mariner-Denver, Inc,, 461
F.Supp. 306 (S.D. Ind. 1978) which involved a suit filed in the
Southern District of Indiana by an Indiana resident alleging she had
_ been injured in a Colorado Holiday Inn. Judge Steckler in that case
examined carefully the facts of the case. The plaintiff alleged that
she was a guest at the Holiday Inn in Denver operated by
Mariner-Denver under a license or franchise agreement with
Holiday Inn of America, Inc. The Court looked closely at the
contacts that the plaintiff had with the defendant while she was in
Indiana. The Court was concerned that the plaintiff claimed that
she chose to stay in this particular Holiday Inn because of
advertising; however, there was no allegation as to where that
advertising took place. The Court took as true the information
contained in the affidavit of the Secretary-Treasurer of defendant
that the corporation did not regularly do or solicit business or
engage in any other persistent course of conduct or derive

34a

substantial revenue or benefit from goods, materials or services
used or rendered in Indiana.

The Oddi court cited a case froia the Middle District of North
Carolina, Bryson v, Northlake Hilton, 407 F.Supp. 73, (M.D.N.C.
1976) which found no personal jurisdiction when a North Carolina
resident had been injured in a Georgia Hilton. The Bryson court
found the Georgia Hilton did benefit from the reputation of Hilton
franchises in North Carolina and was a part of a general network of
motels that solicited business in North Carolina, and made use of
and was part of the reservation service available at Hilton Inn in
North Carolina, and that brochures advertising the Georgia Hilton
were found at the North Carolina Hilton Inn. In any case, the
Bryson court found that that degree of solicitation could hardly be
considered “substantial” as that term is used in long-arm
jurisdiction litigation. Fundamentally, the Oddi case involved no
allegations that the defendant itself did business in Indiana and the
only contact with the State of Indiana was that the defendant rented
a room to an Indiana citizen.

Defendant also cites the case of Eric Carlsen v. Humphreys
(Cayman) Lid, and Holiday Inns, Inc,, a memorandum order of the
United States District Court for the District of Minnesota, Cause

No. 3-87 CIV 45. That case involved a plaintiff in the Cayman
Islands on a college program staying at an inn other than the
Holiday Inn wherein the allegedly tortious incident occurred
evidently on the Holiday Inns’ property. That court specifically
noted that the plaintiff did not contend that he had made any
arrangements with or contacted any representatives of these
defendants in Minnesota while he was a resident of Minnesota in
regard to his trip to the Cayman Islands prior to his departure. The
plaintiff in that case instead relied for minimal contacts on the
defendants’ general advertisements and solicitations within the
State of Minnesota. While those advertisements and solicitations
did not come to his personal attention he said that he had a general
awareness of the defendants’ hospitality and that he gravitated

or |

35a

toward the defendants’ property in the Cayman Islands as a result
of his awareness. He was in fact not actually aware of the Holiday
Inns’ presence on the Cayman Islands until he arrived there. The
Minnesota court denied jurisdiction, not surprisingly.

Defendants further cite the case of Szakacs v. Anheuser-Busch
Companies, Inc,, 644 F.Supp. 1121 (N.D. Ind. 1986). That case
involved an Indiana resident who tripped and fell on an alleged
dangerous and defective sidewalk at Busch Gardens in Tampa,
Florida. The court in that case was concerned that defendant
Anheuser-Busch conducted an advertising campaign in Indiana as
well as other states promoting Busch Gardens generally and that
the plaintiffs were aware of Busch Gardens due to that general
advertisement on the part of the defendant, but “‘no reservations or
contacts were made with Busch Gardens prior to the vacation trip”.
Id. at 1122. The Court therein cited the Supreme Court case of
Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408
(1984) for the proposition that: “Even when the cause of action
does not arise out of or relate to the foreign corporation’s activities
in the forum State, due process is not offended by a State’s
subjecting the corporation to its in personam jurisdiction where
there are sufficient contacts between the State and the foreign
corporation”. 466 U.S. at 414. In addition, the Northern District

cited Helicopteros Nacionales for having:

“distinguished ‘specific jurisdiction’ where the defendant's
conduct creates the cause of action and confers jurisdiction
on the forum State from ‘general jurisdiction’ where
personal jurisdiction is conferred upon the forum State due
to the defendant's general coniacts with the State rather
than the conduct which created the cause of action”.
Szakacs, 644 F.Supp. at 1125.

The Northern District pointed out that the conduct within the State
upon which the plaintiff was relying for minimal contacts was an
advertising campaign. The court further observed that the
plaintiff's cause of action didn’t arise out of the advertising

36a

campaign. The court concluded that in order to find the requisite
general jurisdiction over the defendants, the defendants would had
to have knowingly solicited the business of the plaintiffs with more
than just a general advertising campaign. It was noted that the
plaintiffs did not allege any forum State contractual agreement with
the defendants. For those reasons the court found no jurisdiction in
the Northern District of Indiana.

It is fair to conclude from a review of all the cases cited by
both parties thai in an instance in which a forum plaintiff is injured
on a non-forum premises by the alleged negligence of a non-forum
defendant, minimum contacts means more than a general
advertising campaign on the part of the non-forum defendant in the
forum state. What more contacts with Indiana did the defendants
in this cause have than general advertising? Humphreys had, as
recited in the facts, an ongoing beneficial relationship with a forum
travel club. Its representatives came tc Indiana on occasion to
negotiate business with the Indiana travel club. Reservations were
made in Indiana. Extensive advertisement of more than just the
national magazine and high circulation newspaper variety is
present. Specifically, forum directed advertisement in a forum
based newsletter is present.

While general advertising alone has never been held by itself
to establish the minimal contacts requirement for personal
jurisdiction, there are several cases reported that examine
advertising as it might reflect the concern of the Supreme Court in
Asahi, supra, that courts look for an “intent or purpose to serve the
market in the forum State”. Asahi, at 1033. Hutter Northern Trust
vy. Door County Chamber of Commerce, 403 F.2d 481, 485 (7th
Cir. 1968) is a pre-Asahi case wherein it was recognized that the
transaction of business through active and regionally pointed
solicitation by the non-forum defendant in the forum State
provided the requisite minimal contacts. Therein a Wisconsin
County Chamber of Commerce was found to have devoted a
“substantial share of its energy” to forum solicitation. The court

37a

found that 90% of the defendant’s business was derived from the
forum tourists. The court found that “the Chamber has
purposefully availed itself the privilege of conducting activities
within [the forum] and thereby invoked the benefit of its laws”.

Gavigan v, Walt Disney World, Inc,, 646 F.Supp. 786 (E.D.
Pa. 1986) examines the minimal contact vis-a-vis advertising
circumstance. The court retained jurisdiction over Disney World
examining closely the nature of the adveriising used by Disney
World directed to citizens of Pennsylvania, the forum State. The
court found extensive in-forum solicitation from “Walt Disney
World Days at Jon Wanamaker” to a “Disney Salutes
Philadelphia” to giving the mayor of Philade!phia an honorary
Disney World citizenship. These specifically forum aimed
promotional marketing advertising activities were found sufficient
to give a Pennsylvania court jurisdiction over a controversy
between a forum plaintiff and a non-forum defendant involving a
non-forum tort. The Gavigan Court distinguished local precedents
on precisely these grounds. See Gavigan, 656 F.Supp. 786,
distinguishing Gehling v. St. George’s School of Medicine, Ltd.,
773 F.2d 539 (3d Cir. 1985); Slota v. The Moorings, 343 Pa.
Super. 96 at 108, 494 A.2d 1 at 6 (1985) and Whalen v. Walt
Disney World, Inc., 274 Pa. Super. 246, 418 A.2d 389 (1980).

A similar case voicing similar concerns is Makopoulos v, Walt

Disney World, Inc., et. al,, 221 NJ. Super. 513, 535 A.2d 26
(1987). Therein, the New Jersey plaintiff tried to assert in

personam jurisdiction over the non-forum defendant in the matter
of an alleged non-forum tort. The court concerned itself with the
nature of defendant’s advertisements as minimal contacts. That
court opined: “It is difficult to perceive a distinction between the
drummer of earlier days whose presence at the front door created
jurisdiction and ithe modern television campaign which seeks the
same end and comes into the home to do it”. Id. at 27. Further the
court said: “Thus it may well be that advertising, and particularly
television advertising, can create sufficient contacts to justify in

38a

personam jurisdiction”. Id. at 28. The court sent the case back to
the lower court to develop the facts with this thought: “Sufficient
facts are suggested which if properly developed might permit a
conclusion that defendant purposely directed his solicitation to
residents of this forum, see Burger King Corp. v, Rudzewicz,
supra, 471 U.S. at 472-73, 105 S.Ct. at 2182-83, and could
reasonably expect to be "haled into court’ here. See World-Wide
Volkswagen Corp. v. Woodson, supra, 444 U.S. at 297, 100 S.Ct.
at 567.” Makopoulos, 535 A.2d at 28-29.

The instant case involves more than general advertising. It
involves some presence in Indiana of Caymanian representatives to
negotiate with the airlines. In Wisconsin Electric Manufacturing
Co., Inc. v, Pennant Products, 619 F.2d 676 (1980) the court found
the presence in the forum State of the non-forum representatives on
two occasions dealing with significant matters out of which the
controversy arose to supply the requisite minimal contacts. As
characterized by Madison Consulting Group v, State of South
Carolina “the mere existence of ’a footfall on the State’s soil’” is
not sufficient in and of itself to establish minimal contacts. 752
F.2d 1193, 1200 (7th Cir. 1985)(quoting Erlanger Mills, Inc, v.
Cohoes Fibre Mills, Inc., 239 F.2d 502, 509 (4th Cir. 1956). Yet in
an area of the law wherein the courts are left in the words of Judge
Learmed Hand to “step from tuft to tuft across the morass” 1/, a
footfail on the forum tuft might support the judicial leap of faith
across the morass.

Plaintiffs cite the case of Lehman v. Humphrey Cayman Lid,
713 F.2d 339, and lay stress on the finding of the Eighth Circuit
Court of Appeals in that case. Quoting directly from the case
regarding the facts:

“Lehman’s action stems from the presumed death of her

husband Robert Wayne Lehman while he was a guest at

1/As quoted by Judge Steckler in Oddi v, Mariner-Denver, Inc.,
supra.

39a

the Grand Caymanian Holiday Inn in the Cayman Islands.
Victoria Lehman is a citizen of the State of lowa, as was
Robert Lehman before his death. Humphrey Cayman Ltd.
is a corporation organized under the laws of the Cayman
Islands and maintains corporate offices in Tennessee.
Humphrey Cayman, Ltd. owns and operates the Grand
Caymanian Holiday Inn and is a franchisee of Holiday
Inns. Holiday Inns is a Tennessee corporation and
maintains a registered agent in lowa. Robert Lehman and
his son were guests of the Grand Caymanian Holiday Inn
for several days in November of 1980. On November 21st
Robert Lehman rented a 16 foot "Hobie-Cat’ sailboat from
a sailboat rental shop, Bob Serto’s Diving Ltd., located on
the hotel premises. Robert and two other persons set sail
on the Caribbean Sea. Several hours later observers
informed the manager of the sailboat rental shop that
Robert Lehman's sailboat was not visible from the shore,
an air search was launched, searchers eventually
discovered only the wreckage of the sailboat; Lehman and
his two companions are presumed dead.” 713 F.2d at 340.

The District Court in that case had held that it had exercised
personal jurisdiction over the defendants, but it granted the
defendant's motion to dismiss for forum non conveniens. The
Circuit Court made specific findings in this case that deal with a
personal jurisdiction issue in any case:

“In this case, Robert Lehman was not doing business
abroad on a daily basis but instead was pursuing a personal
vacation of a few days’ duration in a vacation spot located
just outside the United States. In arranging his vacation
he dealt with an American corporation and relied on the
defendants’ representations received by him in Iowa. The
defendants, on the other hand, actively solicited business in
the United States, were incorporated or at least maintained
corporate offices here, and fairly could be expected to
anticipate and take into account the cost of defending a
lawsuit brought in a United Stateg forum.” Id. at 347.

The Circuit Court focused on several factors:

“Robert Lehman was a resident of Iowa, the defendants
engaged in a systematic advertising effort to generate

40a

business in Iowa, the representations regarding the hotel

and its facilities were directed at Robert Lehman and his

son in Iowa, and the hotel reservations were made through

a travel agency in Iowa.” Id. at 344.

The court in a footnote also recognized that the District Court had
determined in deciding to exercise personal jurisdiction that “it is
quite likely that Lehman and his son would never have chosen the
Grand Caymanian if Cayman had not engaged in a systematic
effort to generate business in Iowa”. Id., n.3.

In the cases cited by the defendant in this case no such contacts
have been present in the forum Siate. In Szakacs the only contact
was a general advertisement campaign. In Oddi the only contact
was the plaintiff herself. in Bryson the only contacts were general
advertising and a brochure left in each Hilton advertising other
Hiltons. In Carlsen only general advertisement was alleged. The
instant case is certainly far closer to the Lehman case. Here the
advertisement was fairly specific to members of the Ambassadair
Club, an Indiana based group. The nature of the advertising was
extensive and forum specific for the use of an Indiana based travel
club and to its members, one of whom, of course, was the plaintiff.
Certainly plaintiffs in this case would not have been at the Grand
Caymanian Hotel had it not been for the Grand Caymanian’s
associations with an Indiana travel club. In addition, plaintiffs
having made reservations in Indiana, defendants having been in
Indiana on several occasions negotiating rates with the tour club,
and a substantial benefit being derived from the forum by the —
defendant are all important considerations in finding minimal
contacts. It seems to the Court that these taken together indicate an
intent to serve the Indiana market. It seems reasonable for
Humphreys (Cayman) Ltd. to be “haled” into Indiana.

It is this Court’s opinion that Lehman v, Humphreys Cayman,
Lid, 713 F.2d 339, is controlling in the case at bar, re Holiday
Inns. The facts are extremely similar, the defendants are the same,
the contacts with the forum are similar, the only difference being

4la

that the plaintiffs in the instant case are not residents of the forum.
However, after the analysis of the Supreme Court in Keeton v.
Hustler Magazine it is clear that the plaintiffs’ residence is not the
focus. And not only is the Lehman case dispositive of the motion
regarding personal jurisdiction, re Holiday Inns, but it seems to the
Court is also dispositive on the issue of forum non conveniens.
The interests discussed by the Lehman court are the same.

Therefore, the motions of the defendants Humphreys
(Cayman) Ltd. and Holiday Inns, Inc. to dismiss are
OVERRULED pursuant to Lehman v. Humphrey Cayman, Ltd.
and Holiday Inns, Inc,, 713 F.2d 339 (8th Cir. 1983) cert. denied
464 U.S. 1042, 104 S.Ct. 708, 79 L.Ed.2d 172 (1984).

DATED this 25th day of March, 1988.

LARRY J. McKINNEY, JUDGE
United States District Court
Southern District of Indiana

42a

Distribution io:

Alfred H. Kreckman, Jr.

MASSEY ANDERSON & GIBSON
908 North Main Street

P.O. Box 1030

Paris, Illinois 61944

Phillip A. Terry

McHALE COOK & WELCH

_1100 Chamber of Commerce Building
Indianapolis, Indiana 46204

Steven E. Springer
KIGHTLINGER & GRAY
660 Market Square Center
Indianapolis, Indiana 46204

James A. McDermott
BARNES & THORNBURG
1313 Merchants Bank Building
Indianapolis, Indiana 46204

Theodore J. Nowacki

BOSE McKINNEY & EVANS
1100 First Indiana Building
Indianapolis, Indiana 46204

43a

United States Court of Appeals

For the Seventh Circuit
Chicago, Illinois 60604

November 21 ,/990.

Before
Hon. WILLIAM J. BAUER, Chief Judge
Hon. KENNETH F. RIPPLE, Circuit Judge
Hon. HUBERT L. WILL, Senior District Judge*

DOROTHY A. WILSON and
LOUIS P. WILSON,
Plaintiffs-Appellees,

Appeal from the United
States District Court,
Southern District of
Indiana, Indianapolis

Nos. 88-2495 and 88-2496 v.) Division.
HUMPHREYS (CAYMAN) LTD.,
a corporation, and No. 86C 197. |
HOLIDAY INNS, INC., a corporation. Larry J. McKinney,

A

Defendants-Appellants. Judge.

ORDER

On consideration of the petition for rehearing filed by
defendant-appellant Humphreys (Cayman) Ltd. on November 6,
1990, a majority of the judges on the original panel have voted to deny
the petition. Accordingly,

IT IS ORDERED that the petition for rehearing be, and the same
is hereby, DENIED.

* Judge Will, Senior District Judge, Northern District of Illinois,
sitting by designation.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_1625%3A1. Public record. Not legal advice.