911 F.2d 1357 (9th Cir. 1990), 88-6370, Sher v. Johnson

Docket Nº:88-6370.
Citation:911 F.2d 1357
Party Name:Seymour SHER; Jessica Faith Sher, Plaintiffs-Appellants, v. Paul B. JOHNSON, dba Johnson, Paniello & Hayes; Joseph M. Paniello, dba Johnson, Paniello & Hayes; J. Michael Hayes, dba Johnson, Paniello & Hayes; Robert E. Johnson, dba Johnson, Paniello & Hayes; Johnson, Paniello & Hayes, Defendants-Appellees.
Case Date:August 17, 1990
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

Page 1357

911 F.2d 1357 (9th Cir. 1990)

Seymour SHER; Jessica Faith Sher, Plaintiffs-Appellants,


Paul B. JOHNSON, dba Johnson, Paniello & Hayes; Joseph M.

Paniello, dba Johnson, Paniello & Hayes; J. Michael Hayes,

dba Johnson, Paniello & Hayes; Robert E. Johnson, dba

Johnson, Paniello & Hayes; Johnson, Paniello & Hayes,


No. 88-6370.

United States Court of Appeals, Ninth Circuit

August 17, 1990

Argued and Submitted Feb. 2, 1990.

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[Copyrighted Material Omitted]

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William J. Genego, University of Southern California Law Center, Los Angeles, Cal., and Vicki I. Podberesky, Nasatir & Hirsch, Santa Monica, Cal., for plaintiffs-appellants.

Thomas N. Charchut, Haight, Brown & Bonesteel, Santa Monica, Cal., for defendants-appellees Paul B. Johnson, J. Michael Hayes and Johnson, Paniello & Hayes.

John R. Bush and Douglas S. Gregory, Bush, Ross, Gardner, Warren & Rudy, Tampa, Fla., for defendant-appellee Joseph M. Paniello.

Appeal from the United States District Court for the Central District of California.

Before NELSON, BRUNETTI and KOZINSKI, Circuit Judges.

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KOZINSKI, Circuit Judge:

The issue here is personal jurisdiction over a partnership and its individual partners. Alexandre Dumas notwithstanding, we conclude that all for one does not necessarily mean one for all.


In March 1984, federal officials arrested Seymour Sher in Los Angeles, California in connection with criminal charges brought against him in Tampa, Florida. Sher and his wife, Jessica Faith Sher, retained Thomas J. Nolan, a California attorney, to assist in Sher's defense and to help Sher locate suitable Florida counsel to try the case. Sher and Nolan flew to Tampa and interviewed numerous attorneys in April 1984. They settled on the law partnership of Johnson, Paniello & Hayes (the partnership).

Paul B. Johnson was head counsel for Sher's defense; J. Michael Hayes assisted. The third partner, Joseph M. Paniello, was not personally involved in Sher's case. Although a member of the partnership when it was hired, Paniello was not associated with the firm at the time of Sher's criminal trial or at the initiation of the present action. 1 The law firm is a Florida partnership, and all the individual defendants are Florida residents, licensed to practice law only in Florida.

At an April 27, 1984, meeting at the Tampa Airport, Sher gave Johnson a retainer check for $50,000. A few days later, Johnson sent a letter to Sher in California detailing the retainer agreement. Sher signed the letter and mailed it back to Johnson in Florida.

During the course of the representation, the partnership sent bills to the Shers at their home in California. Mrs. Sher sent checks to the partnership, drawn on a California bank, in payment for legal services. To secure these payments, and pursuant to the retainer agreement, the Shers executed a deed of trust and promissory note in favor of the partnership, encumbering the Shers' residence in Los Angeles in the amount of $75,000. Nolan held the deed, but the deed was not recorded.

Johnson travelled to California to meet with the Shers or Nolan on three occasions. He was the only partner to travel to California in connection with Sher's defense. Johnson and Hayes made several phone calls to the Shers in California, and sent them various communications by mail.

In 1985, a federal jury in Tampa convicted Sher of extortion and several RICO violations. At the time of Sher's trial, the United States Attorney's office that prosecuted Sher was also investigating Johnson for violations of the Hobbs Act. Johnson did not disclose this fact to Sher, and Sher did not discover the investigation until after his conviction. The Eleventh Circuit reversed Sher's conviction on several grounds, including that Johnson's conflict of interest between defending Sher and defending himself violated Sher's right to competent counsel. United States v. McLain, 823 F.2d 1457, 1463-64 (11th Cir 1987).

The Shers filed the present suit in the Central District of California, alleging legal malpractice against the partnership and each of the individual partners. The district court dismissed the action for lack of personal jurisdiction over any of the defendants. The Shers appeal. We review questions of personal jurisdiction de novo when the underlying facts are not in dispute. Haisten v. Grass Valley Medical Reimbursement Fund, 784 F.2d 1392, 1396 (9th Cir 1986).


There are two limitations on a court's power to exercise personal jurisdiction over a nonresident defendant: the applicable state personal jurisdiction rule and constitutional principles of due process. Data Disc, Inc. v. Systems Tech. Assoc., 557 F.2d 1280, 1286 (9th Cir 1977). California's personal jurisdiction rule reads: "A

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court of this state may exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United States." Cal Civ.Proc.Code Sec. 410.10 (1989). This statutory limitation is "coextensive with the outer limits of due process under the state and federal constitutions, as those limits have been defined by the United States Supreme Court." Data Disc, 557 F.2d at 1286 (internal quotations omitted). Jurisdiction in this case is thus constrained only by constitutional principles.

Due process precludes a court from asserting jurisdiction over a defendant unless the defendant has certain minimum contacts with the forum state. The overriding constitutional principle is that maintenance of an action in the forum must not offend "traditional conception[s] of fair play and substantial justice." International Shoe Co. v. Washington, 326 U.S. 310, 320, 66 S.Ct. 154, 160, 90 L.Ed. 95 (1945). The defendant's "conduct and connection with the forum State" must be such that the defendant "should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980).

A court may exercise either general or specific jurisdiction over a nonresident defendant. Helicopteros Nacionales de Colombia S.A. v. Hall, 466 U.S. 408, 414 nn. 8-9, 104 S.Ct. 1868, 1872 nn. 8-9, 80 L.Ed.2d 404 (1984). General jurisdiction applies where a defendant's activities in the state are "substantial" or "continuous and systematic," even if the cause of action is unrelated to those activities. Data Disc., 557 F.2d at 1287 (internal quotations omitted). Where general jurisdiction is inappropriate, a court may still exercise specific jurisdiction if the defendant has sufficient contacts with the forum state in relation to the cause of action. Id.

The Shers do not claim that there is general jurisdiction over any of the defendants here; they argue only for specific jurisdiction. We use a three-part test to evaluate the nature and quality of defendants' contacts for purposes of specific jurisdiction:

(A) some action must be taken whereby defendant purposefully avails himself or herself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of the forum's laws;

(B) the claim must arise out of or result from defendant's forum-related activities; and

(C) exercise of jurisdiction must be reasonable.

Cubbage v. Merchent, 744 F.2d 665, 668 (9th Cir 1984).

The burden of proof is on the plaintiff to show that jurisdiction is appropriate, but in the absence of an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts. Data Disc, 557 F.2d at 1285 ("[I]f a plaintiff's proof is limited to written materials, it is necessary only for these materials to demonstrate facts [that] support a finding of jurisdiction in order to avoid a motion to dismiss."). Issues of credibility or disputed issues of fact may require an evidentiary hearing. Id. Here, the district court considered only the pleadings and other documents. Thus, we need only determine if the Shers have made a prima facie showing of personal jurisdiction, treating their allegations as true. If, however, the undisputed facts reveal sufficient contacts to support jurisdiction, the Shers will have met their ultimate burden on this issue.

The Shers allege that the following contacts are sufficient to support personal jurisdiction over the defendants in California: the execution of a retainer agreement between the Shers and the defendants in California; the collection of payments via checks drawn in California; mail and telephone communication into California; Johnson's visits to California related to the representation; the execution of a deed of trust on real estate located in California; and the appointment of Nolan as an agent of the partnership in holding the deed in California. We analyze jurisdiction over each of the defendants in turn.

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I. Jurisdiction Over the Partnership

  1. Purposeful Availment

    In both Florida and California, a partner is an agent of the partnership when carrying on the business of the partnership in the usual way. Fla.Stat. Sec. 620.60(1) (1989); Cal.Corp.Code Sec. 15009(1) (Supp.1990). For purposes of personal jurisdiction, the actions of an agent are attributable to the principal. See Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 406, 419 (9th Cir.1977). Each of the contacts that plaintiffs claim support jurisdiction are therefore contacts of the partnership, as all are within the scope of the ordinary business of the partnership.

    To be subject to specific jurisdiction, a defendant must have "purposefully avail[ed] itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174,...

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