# Opposition Brief — Miles, Inc. v. Sondergard

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1993
- **Citation:** 510 U.S. 814

## Text

No. 92-1817

In The

Supreme Court of the United States
October Term, 1992

MILES INC.,

Petitioner,

DONALD BRUCE SONDERGARD,

Respondent.

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

BRIEF IN OPPOSITION

Paut D. RHEINGOLD
RHEINGOLD & McGowan
113 East 37th Street
New York, NY 10016
(212) 684-1880

GLEN H. JOHNSON
(Counsel of Record)
JOHNSON HUFFMAN
3202 West Main Street
Rapid City, SD 57702
(605) 348-7300

Wayne F. GILBERT

Jay A. ALDERMAN
JOHNSON HUFFMAN
Rapid City, SD 57702
(605) 348-7300

Counsel for Respondent

COCKLE LAW BRIEF PRINTING CO,, (800) 225-6964
OR CALL COLLECT (402) 342-2831

I.

II.

QUESTIONS PRESENTED

IS THE REGISTRATION TO DO BUSINESS AND
APPOINTMENT OF A REGISTERED AGENT FOR
SERVICE OF PROCESS SUFFICIENT “CONSENT”
TO IN PERSONAM JURISDICTION BY A FOREIGN
CORPORATION WHERE THE CAUSE OF ACTION
AROSE OUTSIDE THE FORUM STATE?

IF A FOREIGN CORPORATION REGISTERS TO DO
BUSINESS, APPOINTS AN AGENT FOR SERVICE
OF PROCESS, AND OFFERS ITS PRODUCT FOR
SALE THROUGHOUT THE FORUM STATE, HAS
THAT CORPORATION ESTABLISHED SUFFICIENT
CONTACTS WITH THE FORUM STATE TO
UPHOLD THE EXERCISE OF GENERAL JURISDIC-
TION?

ii

TABLE OF CONTENTS

Page
CURSE TIPO C NUEEE OOD 6b evn cewnde das eaeenanens i
peo ey reer ne iii
PEE MONEOEE GOP TOU GADD ais sisnccneevaceeereees 1
REASONS FOR DENYING THE PETITION......... 3

I. The Eighth Circuit’s Ruling that Personal Juris-
diction May Constitutionally be Based Solely
on the Appointment of a Registered Agent is
Not in Conflict with the Decisions of Other
DOCU i vito heres Seda s tncedwee eee es Vaaneeys 5

II. The Eighth Circuit’s Alternative Ruling that
Miles’ Business Activities in South Dakota were
Sufficient to Support in Personam Jurisdiction is
Consistent with the Decisions of Other Circuits
eae Ee te on PRET EET PEPE 12

SE 346 civ news cess ebeeeses eRe 17

TABLE OF AUTHORITIES

Page
Cases
Anderson v. U.S., 220 FSupp. 769 (E.D.Penn. 1963) ..... 8
Arney v. Central Electric & Gas Co., 66 F.Supp. 401
ee ahh gps na.0 so S00 e¥ Awad ceeee es 8
Bane v. Netlink, Inc., 925 F.2d 637 (3rd Cir. 1991) ..... 5
Bearry v. Beech Aircraft Corp., 818 F.2d 370 (Sth Cir.
ee eng beak dso) vs 6 04 ON kes va saens 14, 15
Bendix Autolite Corp. v. Midwesco Enterprises, 486
Oe eee 8, 11, 12
Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985)
ICC ECE he beae essere hase veeawevevseesees 8, 11
Burnham v. Superior Court, 495 U.S. 604 (1990)....... 10
Deines v. Vermeer Mfg. Co., 752 F.Supp. 989 (D.Kan.
Er ee ee 8

In Re Des Cases, 789 F.Supp. 552 (E.D.N.Y. 1992)..... 10

General Contracting and Trading v. Interpole, Inc.,
940 F.2d 20 (ist Cir. 1991) .............- ee eee eee 8

Glater v. Eli Lilly & Co., 744 F.2d 213 (1st Cir. 1984)....14
Hanson v. Denckla, 355 U.S. 220 (1957)..........----. 16
Hoffman v. Blaski, 363 U.S. 335 (1960).........-..-.--: 8

Holloway v. Wright & Morrissey, Inc., 739 F.2d 695
cd ea ea uc abs ness ans sna snsys- 7, 8

Insurance Corp. of Ireland v. Compagnie des Bauxites
de Guinee, 456 U.S. 694 (1982)............--.----5-- 8

iv

TABLE OF AUTHORITIES - Continued

Page
International Shoe v. Washington, 326 U.S. 310

Be SEE ORE eee ree eee ree TTT Tee ee passim
Knowlton v. Allied Van Lines, Inc., 900 F.2d 1196

Gee Ss SEES ba ve Conecuseteeanclesvishs ia es 3, 5, 8
Marshall v. Mole Constructors, 193 F.Supp. 617

ke | Pree rrr et Tre eer Tere er er 8
Neirbo Co. v. Bethlehem Shipbuilding Corp., 308 U.S.

Ree Tre re Ce hee ree ry hae 7%
Pennsylvania Fire Ins. Co. v. Gold Issue Mining &

Milling Co., 243 U.S. 93 (1917) ............. ee
Perkins v. Benguet Consol. Mining Co., 342 U.S. 437

FOU ca Vi weniiae cUhekeanna cee rake esas 8, 10, 11
Ratliff v. Cooper Laboratories, Inc., 444 F.2d 745 (4th

Cir.), cert. denied, 404 U.S. 948 (1971) .......... 6, 13
Sandstrom v. Chemlawn Corp., 904 F.2d 83 (1st Cir.

io OE ee LE RE RD oe SE et Ln ae ea 6
Seymour v. Parke, Davis & Co., 423 F.2d 584 (1st Cir.

SES ese KeGa we ie iwh ceed elet aches’ cis 8 C408 14
Shaffer v. Heitmer, 433 US. 106 (1977).............5..- 9
Siemer v. Learjet Acquisition Corp., 966 F.2d 179 (5th

RM WEEE cab Gu Sd dace dud deere cre teuE irks A ee
Sondergard v. Miles, Inc., 985 F.2d 1389 (8th Cir.

ae AE Pee ery er heap gr a om TF
World-Wide Volkswagen Corp. v. Woodson, 444 U.S.

EET ee OTE EP ey Tene eee 16
Ytuarte v. Gruner, 935 F.2d 971 (8th Cir. 1991)........ 8
MIscELLANEOUS
Restatement (Second) of Conflicts of Laws § 44

EME PULA Rech eed LES iene cea bee hews era hardens kek os 7

No. 92-1817
¢

In The

Supreme Court of the United States

October Term, 1992
a

MILES INC.,

Petitioner,

DONALD BRUCE SONDERGARD,
Respondent.

¢

Petition For Writ Of Certiorari
To The United States Court Of Appeals
For The Eighth Circuit
+

BRIEF IN OPPOSITION
*

STATEMENT OF THE CASE

Petitioner Miles Inc. (“Miles”) manufactures Aika-
Seltzer Plus Cold Medicine, which it distributes through-
out the United States including South Dakota. Miles had
applied to the South Dakota Secretary of State for a
Certificate of Authority to transact business in South
Dakota and was granted such authority in August 1991.
At the same time, Miles appointed CT Corporation Sys-
tem as its registered agent in the State of South Dakota.

In October 1989 while residing in Utah, Respondent
Donald Sondergard suffered a stroke after consuming
Alka-Seltzer Plus Cold Medicine. The stroke was caused

by a chemical interaction of Alka-Seltzer Plus with a
prescription anti-depressant he was taking. Sondergard
thereafter moved to South Dakota where this lawsuit was
commenced in October 1991, two months after Miles had
registered to do business and appointed CT Corporation
as its agent for process in South Dakota.

Upon Miles removal of the case to the United States
District Court for the District of South Dakota, Western
Division, the district court immediately granted Miles’
Motion to Stay Discovery’, and thereafter, Miles’ Motion
to Dismiss on personal jurisdiction grounds. The District
Court reasoned that, while the concept of general juris-
diction would be adopted by the South Dakota Supreme
Court, and further that by registering to do business and
appointing a resident agent for service of process, Miles
had consented to the jurisdiction of South Dakota Courts,
nonetheless, the exercise of personal jurisdiction over
Miles could only take place for torts committed by Miles
within the state of South Dakota after it had registered to
do business. See District Court Oral Decision (Petition
Appendix A35, 36).

1 The District Court granted Miles’ Motion to Stay Discov-
ery by Order of December 12, 1991. Contrary to Miles’ assertion,
Mr. Sondergard’s counsel did not waive an evidentiary hearing
on the nature and extent of Miles’ contacts with South Dakota.
is. fact, on January 15, 1992, Mr. Sondergard filed a Motion to
reconsider or Alternatively Stay the Court’s Decision on Miles’
Motion to Dismiss Pending Limited Discovery. The Court
denied this Motion and entered a Judgment dismissing the case
without prejudice.

The Court of Appeals for the Eighth Circuit reversed,
holding that when a foreign corporation expressly con-
sents to jurisdiction in the forum state by registering to
do business and appointing an agent for process, the
minimum contacts/due process analysis of International
Shoe Co. v. Washington, 326 U.S. 310 (1945) becomes
unnecessary. Sondergard v. Miles, Inc., 985 F.2d 1389, 1396
(8th Cir. 1993). See also, Knowlton v. Allied Van Lines, Inc.,
900 F.2d 1196 (8th Cir. 1990).

Moreover, the Eighth Circuit found that Miles’ con-
tacts with the State of South Dakota were, nonetheless,
sufficient to satisfy the requirements of International Shoe
and its progeny. Miles had admitted that it distributed
Alka-Seltzer Plus for sale throughout South Dakota at the
time Mr. Sondergard ingested it. The Eighth Circuit rea-
soned that Miles had purposely availed itself of the bene-
fits and privileges of South Dakota’s laws from its efforts
to market its product in South Dakota, and that South
Dakota’s exercise of personal jurisdiction over Miles
would not violate traditional notions of fair play and
substantiz! justice.

REASONS FOR DENYING THE PETITION

Petitioner Miles claims that International Shoe Co. v.
Washington, 326 U.S. 310 (1945) makes a foreign corpora-
tion’s express consent to personal jurisdiction dependent
nevertheless upon a minimum contacts analysis to satisfy
due process and that Miles’ contacts with the State of
South Dakota are insufficient to support the exercise of
personal “long-arm” jurisdiction. Miles therefore asserts

ences

that the Eighth Circuit’s opinion in this case is wholly
inconsistent with other federal precedent, and that appar-
ent conflict and confusion necessitates review by the
Supreme Court.

The genesis of any confusion is Miles’ interpretation
of the authority it cites, and not any fundamental conflict
or disagreement among the various decisions of other
circuits or this Court. While addressing the issue of gen-
eral jurisdiction, Miles artfully mixes the significantly
different factual and legal concepts of implied and
express consent to jurisdiction and in so doing creates a
conflict that otherwise does not exist.

In consequence, and contrary to the manner in which
Miles incorrectly characterizes the status of the law, the
Supreme Court recognizes that by appointing an agent
for service of process, a foreign corporation expressly
consents to the jurisdiction of the forum state. And in any
event, given Miles’ substantial business contacts with the
State of South Dakota, the due process analysis of Interna-
tional Shoe is undoubtedly satisfied. Because of these
facts, the instant case is nothing more than a typical
general jurisdiction case in which a foreign corporation
has registered to do business, appointed an agent for
service of process, and purposefully directed its activities
toward the forum state. Because it is fact specific and the
Eighth Circuit’s decision is based on long standing
authority, this case does not present the novel oppor-
tunity to clear up the perceived conflict that Miles claims
exists.

I. THE EIGHTH CIRCUIT’S RULING THAT PER-
SONAL JURISDICTION MAY CONSTITU-
TIONALLY BE BASED SOLELY ON THE
APPOINTMENT OF A REGISTERED AGENT IS
NOT IN CONFLICT WITH THE DECISIONS OF
OTHER CIRCUITS.

In considering the issue of express consent to per-
sonal jurisdiction, the Eighth Circuit observed:

“that appointment of an agent for service of
process .. . gives consent to the jurisdiction of
Minnesota courts for any cause of action,
whether or not arising out of activities within
the state. Such consent is a valid basis of per-
sonal jurisdiction, and resort to minimum-con-
tacts or due-process analysis to justify the
jurisdiction is unnecessary.”

Sondergard v. Miles, Inc., 985 F.2d at 1396 (quoting Knowl-
ton v. Allied Van Lines, Inc., 900 F.2d at 1200).2 After
addressing the differences between specific and general
jurisdiction, the Eighth Circuit did not find that a conflict
existed over the recognition of implied and express con-
sent, nor that it was necessary to choose one rule over the
other. Rather, the Eighth Circuit recognized the existence
of express consent to jurisdiction, and cited both circuit
court and Supreme Court authority as support. Son-
dergard, 985 F.2d at 1392, 1395-97. See also, Knowlton, 900
F.2d at 1199-1200.

Miles principally relies on three circuit court cases
for the proposition that the appointment of an agent for

2 See also, Bane v. Netlink, Inc., 925 F.2d 637, 640 (3rd Cir.
1991).

service of process, without more, is not sufficient to con-
fer personal jurisdiction. Siemer v. Learjet Acquisition
Corp., 966 F.2d 179 (Sth Cir. 1992); Sandstrom v. Chemlawn
Corp., 904 F.2d 83 (1st Cir. 1990); Ratliff v. Cooper Laborato-
ries, Inc., 444 F.2d 745 (4th Cir.), cert. denied, 404 U.S. 948
(1971). On close examination, however, it is clear that the
cases above were decided in the context of the forum
state’s long-arm statute - applying the principles of
implied consent. Moreover, the same cases contain signif-
icantly different factual circumstances than are present
here.

In this case, the Eighth Circuit was specifically asked
to decide whether the act of appointing an agent for
service of process automatically confers jurisdiction over
a corporation on any cause of action (i.e., jurisdiction
based on express consent). In contrast, the cases cited by
Miles do not specifically address the issue of express
consent, but rather, proceed directly to the issue of
whether personal jurisdiction exists, if at all, under the
“minimum contacts” analysis (i.e., implied consent) of
International Shoe and its progeny. In other words, the
cases cited by Miles essentially treat the act of appointing
an agent for service of process as only one more “contact”
with the forum state, and not as an independent source of
jurisdiction.

Only one of the above cases cited by Miles appears to
address the question of express consent. See, Siemer v.
Learjet, 966 F.2d at 183. However, the court in Siemer
pointed out that “[n]o Texas state court decision has held
that [the Texas Business Corporation Act] acts as a con-
sent to jurisdiction over a corporation in a case such as
ours — that is where plaintiffs are non-residents and the

defendant is not conducting substantial activity within
the state.” Id. Unlike the Eighth Circuit’s analysis of
South Dakota law, the Siemer court was unable to locate
Texas authority recognizing express consent to general
jurisdiction. The Siemer court simply proceeded to decide
the case on the implied consent (minimum contact) prin-
ciples of International Shoe. Moreover, in this case, Donald
Sondergard was and is a resident of the state of South
Dakota, and Miles did and continues to do substantial
business in the state.

Contrary to Miles’ claims, the First Circuit does rec-
ognize express consent as a valid basis for obtaining
personal jurisdiction over a foreign corporation. In Hollo-
way v. Wright & Morrissey, Inc., 739 F.2d 695 (1st Cir.
1984), the plaintiff asserted jurisdiction based upon per-
sonal service of the defendant’s registered agent. The
defendant claimed that service of process would be
“required or permitted by law” only if the corporation
could be served pursuant to New Hampshire’s long-arm
statute. The Court rejected defendant’s view. Id. at 697.

The First Circuit in Holloway observed that, “[i]t is
well-settled that a corporation that authorizes an agent to
receive service of process in compliance with the require-
ments of a state statute, consents to the exercise of per-
sonal jurisdiction in any action that is within the scope of
the agent’s authority.” Id. (citing Neirbo Co. v. Bethlehem
Shipbuilding Corp., 308 U.S. 165, 170-71 (1939); Pennsylva-
nia Fire Insurance Co., 243 U.S. 93, 95 (1917); Restatement
(Second) of Conflicts of Laws § 44 (1971)). Though the
Holloway Court found some causal connection between
the defendant's activities in the forum state and plain-
tiff’s injury, the clear import of the case is that by

appointing an agent for service of process, a foreign
corporation voluntarily consents to the jurisdiction of
that state’s courts.?

The Eighth Circuit’s decision is likewise consistent
with the rule in Neirbo, and Pennsylvania Fire, and with
other Supreme Court precedent decided after Interna-
tional Shoe. See e.g., Bendix Autolite Corp. v. Midwesco
Enterprises, 486 U.S. 888 (1988); Burger King Corp. v.
Rudzewicz, 471 U.S. 462 (1985); Perkins v. Benguet Mining
Co., 342 U.S. 437 (1952).4

Although parties may not waive subject matter juris-
diction, they may waive personal jurisdiction. Insurance
Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456
U.S. 694 (1982).5 Therefore, consent has been recognized
as a basis for the exercise of general personal jurisdiction.

Express consent has been found to be a basis for
jurisdiction when a foreign corporation appoints an agent
for service of process. See, Neirbo, 308 U.S. at 170-71 and

3 See also, General Contracting and Trading v. Interpole, Inc.,
940 F.2d 20, 22 (ist Cir. 1991) (citing Holloway, Knowlton and
Pennsylvania Fire); Ytuarte v. Gruner, 935 F.2d 971 (8th Cir. 1991);
Deines v. Vermeer Mfg. Co., 752 F.Supp. 989 (D.Kan. 1990); Ander-
son v. U.S., 220 F.Supp. 769 (E.D.Penn. 1963); Marshall v. Mole
Constructors, 193 F.Supp. 617 (W.D. Penn. 1961); Arney v. Central
Electric & Gas Co., 66 F.Supp. 401 (D.Minn. 1946).

4 See, Sternberg v. O'Neil, 550 A.2d 1105 (Del.Supr. 1988) for
a comprehensive examination of express statutory consent to
jurisdiction by means of appointing a registered agent for ser-
vice of process.

5 See also, Hoffman v. Blaski, 363 U.S. 335 (1960).

Pennsylvania Fire, 243 U.S. at 95. Justice Holmes in Penn-
sylvania Fire, concisely summarized the applicable princi-
ple as follows:

The Defendant had executed the power of attor-
ney that made service upon the superintendent
the equivalent of personal service. If by a corpo-
rate vote it had accepted service in this specific
case, there would be no doubt of the jurisdiction
of the state court over a transitory action of
contract. If it had appointed an agent authorized
in terms to receive service in such cases there
would be equally little doubt. It did appoint an
agent in language that rationally might be held
to go to that length. The language has been held
to go to that length, and the construction could
not deprive the defendant of due process of law
even if it took the defendant by surprise, which
we have no warrant to assert.

243 U.S. at 95. The unanimous opinion, written by Justice
Holmes, held that Missouri could constitutionally exer-
cise general jurisdiction over the defendant foreign cor-
poration, and “not deprive the defendant of due
process,” even though its only apparent contact with
Missouri was its designation of the Missouri Superinten-
dent of Insurance as its registered agent. Id.

Petitioner Miles claims that the Supreme Court’s rec-
ognition of express consent to jurisdiction came to an end
with the decision in International Shoe. Arguing that due
process depends upon the quality and nature of the activ-
ity of the defendant in the forum state, Miles maintains
that “all assertions of state court jurisdiction must be
evaluated according to the standards set forth in /nterna-
tional Shoe.” See, Shaffer v. Heitner, 433 U.S. 186, 212 (1977).

10

When read in their proper context, however, the holdings
in International Shoe, and other Supreme Court cases
decided thereafter, are entirely consistent with the contin-
ued viability of the earlier holding in Pennsylvania Fire.®

Perkins v. Benguet Mining Co., 342 U.S. 437 (1952),
upheld the constitutional validity of an exercise of in
personam general jurisdiction with respect to a claim unre-
iated to the foreign corporation defendant’s forum activ-
ity. The context of the case involved the application of the
forum state’s long-arm statute, and a search for minimum
contacts. It was necessary for the Perkins Court to conduct
a minimum contact analysis because the foreign corpora-
tion was not registered to do business in the forum state,
and had not appointed an agent for service of process.
Nevertheless, Perkins reaffirmed the principle that there
would have been no need to search for minimum contacts
if express consent had been given:

Today if an authorized representative of a for-
eign corporation be physically present in the
state of the forum and be there engaged in activ-
ities appropriate to accepting service and receiv-
ing notice on its behalf, we recognize that there
is no unfairness in subjecting that corporation to
the jurisdiction of the courts of that state

6 See In Re Des Cases, 789 F.Supp. 552, 591 (E.D.N.Y. 1992)
(“Although the Supreme Court has not directly pronounced on
the subject since 1945, the constitutionality of the traditional
practice of asserting general jurisdiction solely on the basis of a
corporation’s being licensed to do business in the forum seems
to have survived International Shoe. See Burnham v. Superior
Court, 495 U.S. 604 (1990) (plurality opinion) (International Shoe
did not supplant long - and widely - accepted methods of
asserting jurisdiction” )).

11

through such service of process upon that repre-
sentative. 342 U.S. at 444.

Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985),
continued the rationale that due process considerations
are different when jurisdiction is based on implied con-
sent rather than on express consent. When jurisdiction is
based on implied consent, “[t]he Due Process Clause
protects an individual's liberty interest in not being sub-
ject to the binding judgments of a forum with which he
has established no meaningful ‘contacts, ties, or rela-
tions.’ ” Id. at 471-72 (citing International Shoe, 326 U.S. at
319). However, immediately after stating this general
proposition, the Burger King Court reiterated the position
that personal jurisdiction is waivable:

[w]here a forum seeks to assert specific jurisdic-
tion over an out-of-state defendant who has not
consented to suit there, due process is satisfied if
the defendant has minimum contacts with the
forum.

Burger King, 471 U.S. at 472. (emphasis added). Burger
King and Perkins thus reaffirm that due process is satis-
fied by express consent, since express consent constitutes
a waiver of all other personal jurisdiction requirements.

Bendix Autolite Corp. v. Midwesco Enterprises, 486 U.S.
888 (1988) also appears to accept the express consent
rationale. The issue in Bendix, as in Perkins, involved a
forum state attempting to assert jurisdiction over an
unregistered foreign corporation. The Court stated:

[D]esignation of an agent subjects the foreign
corporation to the general jurisdiction of the
Ohio courts in matters to which Ohio’s tenuous
relation would not otherwise extend. Cf. World-

12

Wide Volkswagen Corp. v. Woodson, 444 U.S. 286
(1980). The Ohio statutory scheme thus forces a
corporation to choose between exposure to the
general jurisdiction of Ohio courts or forfeiture
of the limitations defense, remaining subject to
suit in Ohio and perpetuity. Requiring a foreign
corporation to appoint an agent for service in all
cases and to defend itself with reference to all
transactions, including those in which it did not
have the minimum contacts necessary for sup-
porting personal jurisdiction, is a significant
burden.

486 U.S. at 891. Based on the above decisions, and the
Eighth Circuit’s analysis of both federal and South
Dakota state law, it is clear that express consent remains a
valid means of obtaining personal jurisdiction over a
foreign corporation. The Eighth Circuit’s decision hardly
presents a pathbreaking approach to the exercise of gen-
eral jurisdiction. It is consistent with the holdings of the
Supreme Court and should not be reversed.

II. THE EIGHTH CIRCUIT’S ALTERNATIVE RULING
THAT MILES’ BUSINESS ACTIVITIES IN SOUTH
DAKOTA WERE SUFFICIENT TO SUPPORT IN
PERSONAM JURISDICTION IS CONSISTENT
WITH THE DECISIONS OF OTHER CIRCUITS
AND THE SUPREME COURT.

Notwithstanding the Eighth Circuit’s holding that
Miles had expressly consented to the jurisdiction of South
Dakota courts by appointing an agent for service of pro-
cess, the Court alternatively proceeded to assess the qual-
ity and quantity of Miles’ contacts with South Dakota and

hiccemeaeereneeneneetiasiettaeaataiaimaiamiiiaiieaiiiaaiuaiiiaes

13

found that Miles’ forum contacts were sufficient to sup-
port the exercise of general jurisdiction. However, Miles
contends that even under the application of general juris-
diction, Miles is not amenable to suit in South Dakota.

Miles cites Siemer and Ratliff for the proposition that
the mere sale of a defendant’s products in the forum state
is not sufficient to obtain jurisdiction consistent with the
Due Process Clause. That is an over generalization, how-
ever. A close examination of the facts in both cases
reveals that the quality and quantity of defendant’s con-
tact with the forum state were minimal compared to
Miles’ presence and sales in South Dakota.

Ratliff involved a consolidated appeal by two drug
companies who were sued for injuries caused by the use
of their products. The forum activity of one company was
limited to “solicitation by mail to dealers and whole-
salers, and the mailing of promotional literature to
approximately 650 doctors on its mailing lists.” 444 F.2d
at 746. The other company had actually registered to do
business in the state, and had appointed an agent for
service of process. Id. That same company also main-
tained five detail men in the state who promoted the
companies’ products through personal contacts with doc-
tors and drugstores throughout the state. Id. However,
“their primary responsibility is the promotion of drugs,
not the actual sale of them.” Id.

As the Court in Ratliff aptly pointed out, “[a]pplying
for the privilege of doing business is one thing, but the
actual exercise of that privilege is quite another.” Id. at
748. Neither drug company did substantial business in
the forum state. In contrast, Miles admits that Alka-

14

Seltzer Plus probably does appear on the shelves of groc-
ery and drug stores in every state.

Likewise, in Siemer, defendant Learjet had registered
to do business and appointed an agent for service of
process in the forum state of Texas. However, only
slightly over one percent of Learjet’s sales occurred in
Texas — not amounting to substantial activity according to
the Court. 966 F.2d at 183.

Miles also cites other circuit court opinions for the
same proposition. See e.g., Glater v. Eli Lilly & Co., 744 F2d
213 (1st Cir. 1984) and Bearry v. Beech Aircraft Corp., 818
F.2d 370 (5th Cir. 1987). In Glater, defendant Eli Lilly
employed sales representatives in the forum state, mar-
keted its products nationwide, and advertised its prod-
ucts in journals circulated in the forum state. However,
neither the sales representatives nor Eli Lilly directly sold
products in the forum state, nor had Eli Lilly appointed
an agent to receive service of process.

The First Circuit in Glater found that Eli Lilly’s con-
tacts with the forum state were “indistinguishable” from
a similarly situated defendant drug company in Seymour
v. Parke, Davis & Co., 423 F.2d 584 (1st Cir. 1970). Glater,
744 F.2d at 217. In Seymour, the First Circuit held that
where “defendant’s only activities consist of advertising
and employing salesmen to solicit orders, we think that
fairness will not permit a state to assume jurisdiction.”
Seymour, 423 F.2d at 586-87. Once again, Miles’ contacts
with the State of South Dakota are more continuous,
systematic and pervasive then defendant’s contacts in
Glater or Seymour.

15

In Bearry, defendant Beech Aircraft sold $250,000,000
worth of products in the forum state of Texas. However,
the Fifth Circuit found that these individual sales did not
amount to the type of continuous and systematic contacts
sufficient to support general jurisdiction. Beech Aircraft
made an effort to limit its exposure to general jurisdic-
tion. The Fifth Circuit held:

Beech exercised its right to structure its affairs
in a manner calculated to shield it from the
general jurisdiction of the courts of other states
such as Texas, carefully requiring the negotia-
tion, completion, and performance of all con-
tracts in Kansas. Beech has not afforded itself
the benefits and protection of the laws of Texas,
but instead has calculatedly avoided them.

818 F.2d at 375-76. Significantly, Beech Aircraft had never
qualified to do business nor maintained an agent for
service of process in Texas. Id. at 372.

By comparison Miles, unlike the defendant’s men-
tioned above, purposefully sought out the South Dakota
market for the sale of its product, registered to do busi-
ness and appointed an agent for service of process. The
totality of Miles’ contacts warrant the exercise of general
personal jurisdiction, and in so holding, the Eighth Cir-
cuit was not inconsistent with the authority referenced
above.

Nor is the Eighth Circuit’s decision inconsistent with
the precedent of this Court. Little improvement could be
made on how the Eighth Circuit succinctly characterized
the facts and law in this case:

In any case, we could not conclude that Miles is
unconstitutionally burdened by having to

16

defend this suit in South Dakota. Even without
the appointment of the process agent, Miles
should have foreseen similar suits in South
Dakota at the time Sondergard consumed Alka-
Seltzer Plus. Miles admits that it distributed
Alka-Seltzer Plus for sale throughout South
Dakota at the time Sondergard took it. Its sales
in South Dakota are “not simply an isolated
occurrence, but arise [] from the efforts . . . to
serve, directly or indirectly, the market for its
product in (South Dakota].” World-Wide Volks-
wagen Corp. v. Woodson, 444 U.S. 286, 297 (1980).
Thus, Miles had purposely availed itself of the
benefits and privileges of South Dakota’s laws
and economy. See, e.g., Hanson v. Denckla, 355
U.S. 220, 253-54 (1957). Its own activities created
a connection with South Dakota through which
it could reasonably foresee being haled into
court in South Dakota. See, e.g., World-Wide
Volkswagen, 444 U.S. at 296. Had Sondergard
consumed the Alka-Seltzer Plus in South
Dakota, there would be no question about the
constitutionality of South Dakota’s personal
jurisdiction.

Thus, Miles is left to argue that they could not
foresee being sued in South Dakota on this par-
ticular cause of action. This argument rings hol-
low, however, when one realizes that Miles does
not engage in face-to-face transactions with the
buyers of its products, and does not attempt to
structure its sales of Alka-Seltzer Plus with
regard to whether or not it might be sued in
South Dakota. Instead, it sells Alka-Seltzer in
every state. Because Miles does not limit who
may buy its product or where they may buy it,
we cannot conclude that Miles is unconstitu-
tionally burdened by having to defend this suit

17

in South Dakota simply because the plaintiff did
not consume its product there. We believe that
South Dakota’s exercise of personal jurisdiction
over Miles would not violate “traditional
notions of fair play and substantial justice.” See,
e.g., International Shoe v. Washington, 326 U.S.
310, 318 (1945).

Sondergard v. Miles, Inc., 985 F.2d at 1397.

¢

CONCLUSION

In summary, the questions presented by Miles in the
instant case do not warrant review by this Court. Con-
trary to Miles’ claim, the Eighth Circuit Court of Appeal’s
decision is analytically consistent with other relevant fed-
eral authority addressing the issue of express and implied
consent to jurisdiction. Notwithstanding the existence of
express consent, Miles’ contacts with the State of South
Dakota warrant the exercise of general in personam juris-
diction.

In any event, the facts in this case do not present the
kind of pure “express consent” issue Miles claims it does.
It is submitted that if this court wishes to review the
exercise of express consent to jurisdiction, the instant

case, given Miles’ obvious and substantial direct contacts
with the forum, does not provide the appropriate vehicle

for such consideration.

Pau. D. RHEINGOLD
RHEINGOLD & McGowan
113 East 37th Street
New York, NY 10016
(212) 684-1880

Respectfully submitted,

GLEN H. JOHNSON
(Counsel of Record)
JOHNSON HUFFMAN
3202 West Main Street
Rapid City, SD 57702
(605) 348-7300

Wayne F. GI_Bert

Jay A. ALDERMAN
JOHNSON HUFFMAN
Rapid City, SD 57702
(605) 348-7300

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386019_0852%3A2. Public record. Not legal advice.