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In my last column, I discussed whether a district court must decide a motion to dismiss on subject-matter jurisdiction grounds before any other motion. Similarly, if a case involves a motion to dismiss on personal-jurisdiction grounds as well as a venue motion, must the district court decide the jurisdictional issue first? [ NLJ, Feb. 26.] Some years ago, the 5th U.S. Circuit Court of Appeals decided that subject-matter jurisdiction needed to be established before the district court could decide whether it had personal jurisdiction. In Ruhrgas A.G. v. Marathon Oil Co., 526 U.S. 574 (1999), the Supreme Court disagreed in a unanimous opinion written by Justice Ruth Bader Ginsburg, holding that the personal-jurisdiction inquiry could precede subject-matter jurisdiction inquiry. Similar to the 5th Circuit’s opinion in Ruhrgas, in last month’s column, I wrote about the 3d Circuit’s opinion in which it held that a district court must decide whether it has jurisdiction before turning to a motion to dismiss on forum non conveniens grounds. Malaysia Intern. Shipping Corp. v. Sinochem Intern. Co., 436 F.3d 349 (3d Cir.), reversed and remanded, Sinochem Int’l Co. v. Malay. Int’l Shipping Corp., 127 S. Ct. 1184 (2007). Once again, the Supreme Court reversed. Forum non conveniens not a decision on merits The Supreme Court noted that the forum non conveniens doctrine allows federal district courts to dismiss actions when a foreign court is the more appropriate and convenient forum for adjudicating the controversy. The court’s forum non conveniens decisions, most notably Piper Aircraft Co. v. Reyno, 454 U.S. 235; 102 S. Ct. 252 (1981), allow a dismissal of the federal action when an alternative forum has jurisdiction to hear the case, and when various factors, such as that the trial in the plaintiff’s chosen forum would be unduly oppressive or vexatious to a defendant, or when the federal forum is inappropriate because of considerations affecting the administration of the law in the federal court. When dismissing on forum non conveniens grounds, a court assesses a range of considerations, most including a balance of the convenience to the parties and the practical difficulties that can attend the adjudication of a dispute in a certain locality. Agreeing with the 3d Circuit, the Supreme Court stated that a forum non conveniens dismissal is a determination that the merits of the controversy should be adjudicated in a foreign jurisdiction, and therefore, is a nonmerits ground for dismissal. Accordingly, the Supreme Court stated, “[a] district court therefore may dispose of an action by a forum non conveniens dismissal, bypassing questions of subject-matter and personal jurisdiction, when considerations of convenience, fairness, and judicial economy so warrant.” As it stated in Ruhrgas, the court stated that if a district court can readily determine that it lacks jurisdiction over the case or the defendant, the proper procedure would be for the district court to determine whether there is jurisdiction first, and then dismiss if jurisdiction is lacking. The court seemed to stress that in most cases, jurisdiction does not involve a difficult inquiry and both judicial economy and the consideration ordinarily accorded the plaintiff’s choice of forum should impel the federal court to dispose of jurisdictional issues first. But when subject-matter or personal jurisdiction is difficult to determine, and forum non conveniens considerations weigh heavily in favor of dismissal, the district court may properly take the less burdensome course. It is noteworthy that both Sinochem, and the case it largely relied on, Ruhrgas, were unanimous opinions. More importantly, the court appears to be squarely behind notions of judicial efficiency and district court discretion when looking at purely procedural issues that arise in the context of civil litigation. This is in contrast to the fractured opinions the court issues in civil cases involving due process issues. For example, in the court’s class action cases, there often is a battle between Ginsburg, the author of the Sinochem case and Amchem Prods. v. Windsor, 521 U.S. 591 (1997), and Justice Stephen G. Breyer. In Amchem, Ginsburg took a relatively formalistic view of due process in contrast to Breyer’s plea for efficiency and district court discretion in his dissent from the reversal of class certification in the asbestos litigation. More recently, just this term, the court similarly split, 5-4, in its punitive damages case, Phillip Morris USA v. Williams, 127 S. Ct. 1057 (2007), with Breyer writing the majority opinion, and Ginsburg writing a dissent in which justices Clarence Thomas and Antonin Scalia joined. The due process cases thus produce strange bedfellows, while the purely procedural cases generally produce consensus. Looking specifically at the court’s opinion in Sinochem, especially because of its reliance on Ruhrgas, it is important to look at how the court’s opinion likely will be interpreted by the lower federal courts. In Ruhrgas, the court, as it did in Sinochem, made a point of saying that, ordinarily, jurisdictional issues should be resolved before moving on to other nonmerits, threshold issues. Efficiency would be served when the lower court was seeking to avoid deciding a difficult jurisdictional issue by deciding such other threshold issues. However, courts have interpreted the Ruhrgas case liberally. For example, in Alpine View Co. v. Atlas Copco A.B., 205 F.3d 208, 213-14 (5th Cir. 2000), the court had to chose whether to resolve the subject-matter jurisdiction argument before looking at the personal-jurisdiction issue. The 5th Circuit decided that when judicial economy weighed in favor of resolving a personal-jurisdiction issue first, the district court did not abuse its discretion in deciding such matter first, whether or not the subject-matter jurisdiction issues could be considered particularly difficult. It is also noteworthy how easy the Sinochem case was in terms of the forum non conveniens issue. There was related pending litigation in a Chinese court. The plaintiff’s federal lawsuit was a reactive lawsuit, and, as such, disfavored. The court made it plain how easy a case it was. It is also true that Ruhrgas involved the question of whether one type of jurisdiction should be established before the other, as opposed to a jurisdictional issue versus another type of nonmerits threshold issue. Nonetheless, it is likely that lower courts will follow the approach of the 5th Circuit in Alpine View, and leave it to the lower courts’ discretion to find the right balance in terms of deciding the jurisdictional issue or the other nonmerits threshold issue. Speaking of nonmerits, the court noted that forum non conveniens issues frequently overlap with issues on the merits. A court may need to identify the claims presented and the evidence relevant to those issues to rule on a forum non conveniens motion. This overlap does not convert a forum non conveniens determination to a merits determination. The crucial distinction is that dismissal based on forum non conveniens does not entail any assumption by the court of substantive “law-declaring power.” The 3d Circuit issues ‘Sinochem’ with regrets The court left open a further issue: whether a court, without first establishing its jurisdiction, could condition a forum non conveniens dismissal on the defendant’s waiver of any statute of limitations defense or objection to the foreign forum’s jurisdiction. The 3d Circuit had expressed a concern that, without first determining its jurisdiction, a court could not shield the plaintiff against a foreign tribunal’s refusal to entertain the suit. This was not an issue here, however, as the plaintiff faced no genuine risk that the more convenient forum would not take up the case. Proceedings to resolve the dispute had already been brought in China by the defendant, and the jurisdiction of the Chinese court had been clearly established. Therefore, there was no need to decide this issue. The 3d Circuit majority in Sinochem had noted that it reached its holding with regrets, “as we would like to leave district courts with another arrow in their dismissal quivers.” It also recognized the inefficiency in its approach, but believed that it would reduce itself to a mere pundit if it were to permit the hypothetical jurisdiction prohibited by Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 101-02. So, it invited the Supreme Court to resolve the issue. Now we know that the court will forego the formal Steel Co. route, and take the practical Ruhrgas route when looking at purely procedural issues pertaining to forum selection. Georgene M. Vairo is a professor of law and William M. Rains Fellow at Loyola of Los Angeles Law School. She is on the Board of Editors of Moore’s Federal Practice, and writes the Moore’s chapters on removal and venue problems. Professor Vairo can be reached at [email protected].

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