Fifth Circuit Doubles Down on International Shoe

SK/SZS SAS Ireland Airbus 320 EI-SIB by Riik@mctr (CC BY-SA 2.0)

A recent Fifth Circuit decision stoutly reaffirmed that court’s en banc position that the personal jurisdiction analysis is the same under the Fifth and the Fourteenth Amendments. Indeed, reading Hardy v. Scandinavian Airlines System, one would have no idea that a vocal minority of federal appellate judges have been calling for a veritable revolution in personal jurisdiction doctrine, at least as it pertains to the Fifth Amendment. As a worried observer of that debate, I find Judge Jerry Smith’s opinion on behalf of the unanimous panel refreshingly straightforward—though I can’t help but read between the lines to find some implied rebukes of those colleagues who might have taken a different tack.

A U.S. Resident Flies to Oslo

Susan Hardy took a United Airlines flight from her home in Louisiana to Newark, New Jersey. From there—on a separate ticket—she flew to Oslo, Norway, on a Scandinavian Airlines System (“SAS”) flight. As she disembarked in Oslo, she fell and broke her leg. After a hospital stay in Norway, she returned home for further treatment. There, she sued SAS in the Eastern District of Louisiana, alleging strict liability under the Montreal Convention of 1999 (“Montreal Convention”).

The Montreal Convention governs airline liability for passenger deaths and injuries, as well as damage or loss of baggage and cargo. It has 137 contracting parties, including the United States, and it covers flights between member states (including domestic portions of multi-leg international itineraries).

SAS ultimately waived service under Federal Rule of Civil Procedure 4(d) but moved to dismiss Hardy’s complaint for lack of personal jurisdiction. The district court granted the motion to dismiss, but the Fifth Circuit reversed. It agreed with the district court’s conclusion (but not its rationale) that the Montreal Convention does not itself create personal jurisdiction over the airline—a question which merits a separate post. But independently of its analysis of the Montreal Convention, the Fifth Circuit held that specific jurisdiction could be exercised over SAS pursuant to Rule 4(k)(2). And that seems right.

“As Every First-Year Law Student Learns…”

Rule 4(k)(2) provides:

(2) Federal Claim Outside State-Court Jurisdiction. For a claim that arises under federal law, serving a summons or filing a waiver of service establishes personal jurisdiction over a defendant if:

(A) the defendant is not subject to jurisdiction in any state’s courts of general jurisdiction; and

(B) exercising jurisdiction is consistent with the United States Constitution and laws.

As the court explained, Hardy’s claim arises under federal law and the defendant airline waived service. Further, the Fifth Circuit has adopted the eminently reasonable presumption that it is up to the defendant to identify a U.S. state that could exercise personal jurisdiction over it in relation to the dispute. Because SAS had not conceded that it was subject to personal jurisdiction in any U.S. state, the court concluded that the requirement of Rule 4(k)(2)(A) had also been met.

That left Rule 4(k)(2)(B). Here Judge Smith invoked the Fifth Circuit’s en banc decision in Douglass v. Nippon Yusen Kabushiki Kaisha (2022), which held that the exercise of personal jurisdiction under Rule 4(k)(2)(B) must comport with the due process clause of the Fifth Amendment, which in turn calls for an analysis that mirrors the analysis used in the context of the Fourteenth Amendment. And “[a]s every first-year law student knows,” the Fourteenth Amendment test is the one derived from International Shoe Co. v. Washington (1945). The only (albeit significant) difference is that a Fifth Amendment analysis looks beyond the defendant’s contacts with the forum state to consider the defendant’s contacts with the United States as a whole.

Applying the International Shoe framework, the court held that SAS had purposefully availed itself of the United States: it operates flights from seven U.S. metro areas, advertises and sells tickets to U.S. consumers, owns and operates a U.S. subsidiary, and participates in the Star Alliance with United Airlines. Further, the court explained, those U.S. contacts “combined to create an unbroken causal chain that end[ed] with Hardy’s injury” as she disembarked the SAS plane in Oslo.

The court even engaged in a full-fledged analysis of the five “reasonableness” factors for specific jurisdiction—factors that have gone missing in recent Supreme Court personal jurisdiction cases.  First, it acknowledged that the case would pose a significant burden on SAS as a foreign corporation defending against liability for an injury that occurred outside the United States. On the other hand, it noted, SAS regularly litigates in the United States (including having declared bankruptcy here), and it is a business particularly well-equipped to engage in cross-border litigation. Further, the United States has a significant interest in disputes regarding the injury of U.S. citizens and residents (and regarding flights departing from the United States), and the plaintiff has a particularly weighty interest in litigating close to home, especially because of her injury.

While the court acknowledged the “opacity” of the fourth and fifth factors (“the interest of the interstate judicial system in the efficient administration of justice” and “the shared interest of the several states in furthering fundamental social policies”), it reserved for another day the question of whether those factors even apply in the context of Rule 4(k)(2) and the assertion of federal personal jurisdiction. I agree that those last two factors are not particularly helpful and could benefit from being updated, clarified, or even jettisoned.

Loud Silence?

All of this analysis strikes me as straightforward and correct. What is surprising—though perhaps it shouldn’t be—is that the panel did not even acknowledge the minority view that the due process analysis under the Fifth Amendment should differ from that under the Fourteenth. It shouldn’t be surprising precisely because that minority view has remained just that—a minority, albeit a vocal one. The en banc Fifth Circuit has definitively established the law of the circuit on this point, which the panel duly applied. And as the panel pointedly noted in a footnote, other circuits have reached the same conclusion (including the Second, Sixth, Seventh, Ninth, Eleventh, Federal, and D.C. Circuits). There has been even less support across the lower courts for discarding the International Shoe framework altogether, despite the apparent interest of some Supreme Court Justices in doing so.

Given what the court did say in support of its analysis, including its string cite to other circuits, its lack of acknowledgment of the minority view feels purposeful. I wonder if the Hardy court has the right idea: giving the minority position continued airtime—even to reject it—only adds oxygen to the room, feeding what flames that argument has left. Perhaps it is better to just ignore the outlier view that most federal judges have (properly, in my view) rejected.

At least, that is, until the Supreme Court decides to consider it.