Benally on behalf of Benally v. Amon Carter Museum of Western Art, 85-2838

• Decision Date: 03 October 1988
• Docket Number: No. 85-2838,85-2838
• Citation: 858 F.2d 618
• Parties: Lillie BENALLY and Grant Benally on Behalf of Norman BENALLY, an adult, Plaintiffs-Appellants, v. AMON CARTER MUSEUM OF WESTERN ART, Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 618

858 F.2d 618

Lillie BENALLY and Grant Benally on Behalf of Norman BENALLY, an adult, Plaintiffs-Appellants, v. AMON CARTER MUSEUM OF WESTERN ART, Defendant-Appellee.

No. 85-2838.

United States Court of Appeals Tenth Circuit.

Oct. 3, 1988.

Stephen T. LeCuyer, Mettler & LeCuyer, Shiprock, N.M., for plaintiffs-appellants.

Stephen L. Tatum of Cantey, Hanger, Gooch, Munn & Collins, Fort Worth, Tex. (Arthur O. Beach and Margaret E. Davidson of Keleher & McLeod, Albuquerque, N.M., with him on the brief), for defendant-appellee.

Before LOGAN, ANDERSON, and TACHA, Circuit Judges.

LOGAN, Circuit Judge.

Plaintiffs Lillie Benally and Grant Benally, on behalf of Norman Benally, appeal the district court's dismissal, for lack of personal jurisdiction, of their invasion of privacy claims against defendant Amon Carter Museum of Western Art (the Museum). The district court's decision is reported as Benally v. Hundred Arrows Press, Inc., 614 F.Supp. 969 (D.N.M.1985). The issues on appeal are (1) whether the New Mexico long-arm statute, N.M.Stat.Ann. Sec. 38-1-16, permits the exercise of diversity jurisdiction over the Museum, and if so, (2) whether the exercise of jurisdiction in New Mexico over the Museum would offend the "traditional notions of fair play and substantial justice" embodied in the Due Process Clause of the Fourteenth Amendment of the United States Constitution.

Plaintiffs are Navajo Indians and domiciliaries of New Mexico. In 1932, artist Laura Gilpin photographed Lillie Benally in native dress in her home holding her baby, Norman, in a cradleboard. Lillie Benally granted Gilpin permission to take the photograph, but allegedly neither she nor anyone else in her family ever authorized its publication or public exhibition. The photograph, entitled "Navaho Madonna," became part of Gilpin's collection. Gilpin became famous, and before her death on November 30, 1979, the print had been published on a postcard and in three books and two magazines, and exhibited at least thirty-five times throughout the United States.

The defendant Museum is a nonprofit corporation organized under Texas law and has its principal place of business in Fort Worth, Texas. In April 1978, Mitchell Wilder the Museum director, reported to the Museum's board of directors that Gilpin would bequeath her photographic collection, including the Benally photograph, to the Museum; the gift was to be announced in May 1978 in conjunction with an exhibition of Gilpin's works by the Museum. Over the next eighteen months, the Museum negotiated with Gilpin over the specific plans for the collection after her death. In June 1978, Wilder reported that he had spent almost a week in Santa Fe, New Mexico, working with Gilpin on plans for the collection. He returned from New Mexico with some of Gilpin's original nitrate negatives to work on methods of preserving them. In July 1978, the Museum hired Rosamund Kolberg to transfer the negatives to acid-free envelopes; she worked several months in Santa Fe, transferring and cataloging the negatives for use in the Museum. An internal memorandum dated July 27, 1978, proposed, and the Museum director agreed, that the Museum pay "all expenses incurred in the wooing and acquiring [of] Miss Gilpin's photographic collection" out of the Museum's account for acquiring photographs and treat these expenses on the Museum's books as part of the cost of the collection. I R., Exh. 4 at 5.

In August 1979, Ron Tyler, the Museum's acting director, and Martha Ann Sandweiss, the curator of photographs, met with Gilpin and her attorney in Santa Fe. The Museum also produced, in collaboration with a Texas film maker, a documentary film about Gilpin and her work. By September 30, 1979, fifteen days of filming in Santa Fe had been completed. In October 1979, the Museum corresponded with Gilpin's attorney in Santa Fe about an agreement obligating the Museum to preserve the collection and dictating the conditions under which the Museum could exhibit, duplicate, and sell prints from the collection. Gilpin's attorney sent a draft of this agreement to Tyler on October 1. On October 10, 1979, Tyler wrote Gilpin's attorney in New Mexico proposing a change in the agreement to allow the Museum to make the Gilpin Collection available to the public according to the Museum's normal restrictions. Tyler, the next day, and Sandweiss, on October 23, telephoned Gilpin's attorney to discuss the agreement. An amended Gilpin-Museum agreement was signed by Gilpin in October 1979 and by Tyler in November 1979. The Museum's board of directors ratified it on November 15, 1979.

Gilpin died on November 30, 1979, bequeathing, with certain exceptions, her entire photographic library to the Museum. The bequest included the negative and nine prints of the Benally photograph. Her will was executed and probated in New Mexico. Sandweiss traveled to New Mexico to supervise the packing and shipment of the photographs in Gilpin's possession at the time of her death.

The Gilpin-Museum agreement requires the Museum to report annually on the use, maintenance, and activities of the Gilpin Collection to a three-person committee, which includes Richard Rudisill of Santa Fe, New Mexico. Pursuant to this agreement, Sandweiss submitted annual reports to Rudisill in Santa Fe in October 1980, September 1981, October 1982, and October 1983. In the 1983 report Sandweiss advised that the Henry Luce Foundation had given a grant of $125,000 to the Museum to support further work on the Gilpin Collection, including a biography of Gilpin. Sandweiss stated that she planned to go to Santa Fe for three months in 1984 to work on the biography.

In February 1980, the Museum provided copies of several photographs from the Gilpin Collection, including "Navaho Madonna," to Four Winds magazine in Austin, Texas, for use with a story by Sandweiss entitled "Laura Gilpin's Indians--An Enduring Image." The Museum charged $5.00 for each print it sent to the magazine. Four Winds ran the story in its Autumn 1980 issue and displayed the Benally photograph on its cover. Pursuant to the Museum's regulations for reproducing photographs, the magazine provided a credit line under the photograph reading "Courtesy Laura Gilpin Collection, Amon Carter Museum, Fort Worth, Texas." I R. 54, Exh. 11 at 1.

In August 1981, Lillie Benally's daughter-in-law, Sophie Benally, learned of and informed plaintiffs about the publication of the photograph; at that time plaintiffs were not aware that the photograph had been exhibited and published previously. Plaintiffs objected to the photograph's reproduction because of the traditional Navajo belief that the publication of photographs can have bad effects on the people in the photographs.

The photograph was published twice in Texas-based magazines in 1981. Southwest Art published it with a story about Gilpin written by Michael Duty, who was then the Museum's public relations and development officer. The magazine gave a credit line to the Museum with the story. The Museum also provided the print for use with a story in Texas Monthly about the Museum's twentieth anniversary. It was the only photograph from the Gilpin Collection to appear with the story.

In March 1984, plaintiffs sued the Museum, the publishers of Four Winds, Southwest Art and Texas Monthly, and Communications Specialists, Inc. (CSI) ¹ in the federal district court in New Mexico for unlawful public disclosure of private facts and misappropriation of likeness. The Museum entered a special appearance seeking to dismiss the claims against it for lack of personal jurisdiction, and the district court granted the Museum's motion. The magazine publishers, who are all Texas residents, did not contest jurisdiction but moved to dismiss the claims pursuant to Fed.R.Civ.P. 12(b)(6). The court treated their motions as motions for summary judgment and granted them. Benally, 614 F.Supp. at 976, 980-83. Plaintiffs do not appeal the entry of summary judgment; they challenge only the district court's decision that it lacked personal jurisdiction over the Museum.

I

Federal courts sitting in diversity have personal jurisdiction over nonresident defendants to the extent permitted by the law of the forum. See Fidelity & Casualty Co. of N.Y. v. Philadelphia Resins Corp., 766 F.2d 440, 442 (10th Cir.1985), cert. denied, 474 U.S. 1082, 106 S.Ct. 853, 88 L.Ed.2d 893 (1986). New Mexico's long-arm statute provides in pertinent part as follows:

"Any person, whether or not a citizen or resident of this state, who in person or through an agent does any of the acts enumerated in this subsection thereby submits himself or his personal representative to the jurisdiction of the courts of this state as to any cause of action arising from:

(1) the transaction of any business within this state;

....

(3) the commission of a tortious act within this state;...."

N.M.Stat.Ann. Sec. 38-1-16(A). New Mexico courts apply a three-step test to determine whether they have personal jurisdiction over nonresident defendants: "(1) the act must be enumerated in the long-arm statute, [N.M.Stat.Ann. Sec. 38-1-16(A) ]; (2) plaintiff's cause of action must arise from the act, [id. Sec. 38-1-16(C) ]; and (3) the act(s) of defendant must establish the minimum contacts necessary to satisfy due process." Salas v. Homestake Enterprises, Inc., 106 N.M. 344, 742 P.2d 1049, 1050 (1987).

A

The first step of this test requires us to determine whether the Museum committed an act enumerated in the long-arm statute. Plaintiffs assert that the Museum comes within the long-arm statute because it has "transacted business" within New Mexico.

The Museum's first line of defense against this argument is that, as a nonprofit organization, whatever it did in New Mexico cannot be characterized as "transacting business." The only New Mexico case we found explicitly involving a nonprofit corporation is Valley Wide Health Services, Inc. v. Graham, 106 N.M. 71, 738...