Walker v. Savell
| Decision Date | 11 August 1964 |
| Docket Number | No. 20682.,20682. |
| Citation | 335 F.2d 536 |
| Parties | Edwin A. WALKER, Appellant, v. Van H. SAVELL and the Associated Press, Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Joe W. Matthews, Dallas, Tex., John W. Capers, Jackson, Miss., Murray L. Williams, Water Valley, Miss., Clyde J. Watts, Looney, Watts, Looney, Nichols & Johnson, Oklahoma City, Okl., for appellant.
Earl T. Thomas, Jack W. Brand, Jackson, Miss., Fred B. Smith, Ripley, Miss., Robert G. Gillespie, Jr., Jackson, Miss., for the Associated Press, appellee, Wells, Thomas & Wells, Jackson, Miss., of counsel.
Before TUTTLE, Chief Judge, and POPE* and BROWN, Circuit Judges.
General Walker appeals from an order of the District Court for the Northern District of Mississippi quashing the service of process and dismissing a complaint alleging libel on the ground that The Associated Press was not amenable to service under the provisions of Section 1437, Mississippi Code Annotated, 1942.1
The suit was originally filed by appellant Walker in the Circuit Court of Lafayette County, Mississippi, on October 22, 1962, against the appellee The Associated Press, and Van H. Savell, resident of Mississippi, who is alleged to have written the libelous article. Asserting that a separable controversy was alleged against Savell, arising under the laws of the United States, and in view of the non-resident status of Associated Press, the suit was removed to the United States District Court by petition filed on November 9, 1962. Thereafter, on November 14, The Associated Press filed its motion in the district court for the dismissal of the case as to it, or in lieu thereof, for the quashing of the process attempted to be served on it on the ground that it was not doing business in Mississippi so as to be subject to process therein. Thereafter, on November 19, appellant filed a motion to remand the action to the state court. The district court notified counsel that both of said motions would be heard on affidavits, counter-affidavits and briefs of counsel. On January 14, 1963, the court notified counsel that it would rule on the motion to dismiss before considering appellant's motion to remand. Three days thereafter, appellant served on The Associated Press and Savell long interrogatories designed to determine whether appellee was "doing business" in Mississippi. At appellant's request the district court deferred ruling on appellees' motion to dismiss until the interrogatories had been answered.
After the interrogatories had been answered, appellant moved the court, on March 20, 1963, to rule on the motion to remand prior to ruling on appellees' motion to dismiss. The court overruled this motion by order dated March 22, stating that no compelling reason existed for a reversal of the court's prior decision. The district court entered its order on May 10, 1963, quashing the process and dismissing the suit as to appellee.
The appellant here complains that the trial court erred in deciding appellees' motion to dismiss prior to passing on appellant's motion to remand the case to the state court. The appellant also complains that the court erred in not delaying the decision on the motion to dismiss pending further discovery procedures by the appellant. Appellant further complains that on the merits of the motion to quash the court erred in finding that The Associated Press was not "doing business" in Mississippi and dismissing the action as to it. Finally, appellant complains at length that the case was not removable to the district court in the first place, and that if the court had passed on the motion to remand first, it would have been compelled to remand the case to the state court. We deal with these points in the order in which they are set forth.
Where, as here, the attack on jurisdiction is as to the amenability of defendant to process rather than an attack on jurisdiction over the subject matter, we conclude that the federal court had a right to consider the motion to quash service and determine the jurisdictional question before remanding the case to the state court. If the appellee was not amenable to service of process this could properly be decided before the court took any further action on the motion of the appellant in the nature of a motion for remand. Block v. Block, 7 Cir., 196 F.2d 930. See also 1-A, Moore's Federal Practice, Sec. 0.169(1), pp. 1431-1434. There is nothing in our case of Weeks v. Fidelity & Casualty Co., 5 Cir., 218 F.2d 503, inconsistent with what we here hold. There the question was whether the court had jurisdiction over the subject matter rather than jurisdiction over the person of the defendant. We think the language of the Court of Appeals for the First Circuit in Garden Homes v. Mason, 1 Cir., 238 F.2d 651, is apposite here. There, being faced with a motion for remand to the state court and a motion by the defendant to dismiss for failure to effect proper service of process, the Court said:
We think here the trial court had the power to dispose of the motion to quash before first passing on the motion for remand. See also Phillips v. Manufacturers Trust Co., 9 Cir., 101 F.2d 723, a case decided under the former removal statute.
Since this case was, under the terms of the removal statute, unquestionably in the district court even though later subject to a proper motion for remand, if a suit could properly be pending anywhere, once it became apparent by the filing of the motion to quash service of process that there was a question raised by the defendant below whether it could properly be brought into court in Mississippi under any circumstances, it was proper for the trial court to examine into this question immediately and not subject the defendant, so protesting, to a further hearing on the motion to remand and possibly to a further hearing in a state court where it would then have to raise once again the question of personal jurisdiction. Once appellee lodged in the district court its challenge to the jurisdiction in personam, it was entirely appropriate for that court to inquire into, and resolve, that issue.
Dealing with the next alleged error, we conclude that the trial court did not abuse its discretion in refusing to delay decision on the motion to dismiss by the appellant. There was ample time after the filing by the appellee of the original affidavit protesting jurisdiction and after the response by appellee to the interrogatories for appellant to have proceeded to obtain further discovery, but nothing in this direction was done for two months after the answers to the interrogatories had been served. The motion filed by the appellant for the taking of depositions to contradict the claimed absence of jurisdiction over the appellees, did not purport to make any showing as to why the facts it sought to produce were unavailable to it by affidavit. We conclude that the trial court did not err in denying the motion.
We now come to the question on the merits whether the trial court erred in determining that The Associated Press was not "doing business" in the state of Mississippi within the contemplation of the statute authorizing service on foreign corporations not qualified within the state of Mississippi. This is a fact question. The following facts, as existing at the time of the attempted service, are undisputed:
The Associated Press is a mutual cooperative and non-profit association, formed to gather, collect and interchange with its members news and intelligence which, under the terms of its charter, it can neither sell nor traffic in such news items, but distributes them only to its members. The cost of these services are apportioned among the members in the form of assessments. In the state of Mississippi it had, at the critical point of time, five employees; four were newsmen whose duties were to gather news items and forward them to New Orleans, Louisiana, where they were approved or circulated. Some of the news items were re-transmitted to Mississippi members of The Associated Press and were used within the state of Mississippi. The other employee is a maintenance man, whose duty was to repair equipment used by The Associated Press in disseminating its services in Mississippi and other states. It did not own or lease any office space in Mississippi; it did not have any bank account there; it did not advertise its service in Mississippi; it kept no corporate books or records in that state; it did not execute any contract in Mississippi, or have any officer or director resident there. It did not make available to its members or others in Mississippi any news items procured there until said items had been transmitted to offices outside the state of Mississippi for approval. It made no purchases of supplies in the state of Mississippi to be used in the gathering of news or otherwise within the state of Mississippi. Based on these facts the trial court found, by comparison with the Memphis Publishing Company case, as follows:
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