Curtis Publishing Company v. Golino, 23385.
| Decision Date | 27 September 1967 |
| Docket Number | No. 23385.,23385. |
| Citation | 383 F.2d 586 |
| Parties | The CURTIS PUBLISHING COMPANY, Appellant, v. Felice GOLINO, Appellee. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Philip H. Strubing, Philadelphia, Pa., R. Emmett Kerrigan, New Orleans, La., for appellant.
Russell T. Tritico, Morgan City, La., for appellee.
Before THORNBERRY and COLEMAN, Circuit Judges, and YOUNG, District Judge.
Rehearing En Banc Denied September 27, 1967.
This appeal presents the question whether, in the factual context of this case, assertion of jurisdiction over Curtis Publishing Company, a non-resident publisher, by means of the Louisiana long-arm statute is constitutionally permissible. The district court, in denying appellant's motion to dismiss, held that jurisdiction was properly acquired and did not violate constitutional requirements. We affirm.
Appellee Golino brought this action for libel against Curtis Publishing Company in the United States District Court for the Eastern District of Louisiana to recover damages allegedly resulting from an article in the February 29, 1964, issue of the Saturday Evening Post entitled: "New Orleans: Cosa Nostra's Wall Street — Crime in America: VI." In response, Curtis submitted a Motion to Dismiss, claiming that service upon it under Louisiana's "long arm" statute1 violated the due process clause, the commerce clause, and the first amendment. By affidavit in support of this motion, Curtis stated that:
it is a Pennsylvania corporation which is not licensed to do business in Louisiana, has no office, place of business, officers, agents, employees, solicitors, reporters, correspondents or photographers in that state, has no agent for service of process in that state, is not listed in any telephone directory in that state, and has no bank account or other assets or property in that state.
The affidavit also declared that:
(1) The article in question was written by an independent writer under contract with Curtis and was actually written in Connecticut, although the writer visited New Orleans to gather information and background material.
(2) There are no employees of Curtis in Louisiana soliciting subscriptions from residents. Subscriptions result from applications sent to Curtis' offices in New York or Pennsylvania.
(3) An independent national distributor, not Curtis itself, sells all newsstand copies of the Saturday Evening Post in Louisiana.
(4) Curtis has no reporters or correspondents regularly assigned to Louisiana. Occasionally such persons will be sent to the state upon special assignments.
(5) Curtis has no advertising solicitors regularly assigned to Louisiana, although occasionally a solicitor will visit the state.
(6) For the three years 1962-64, the average percentages of Curtis' business (Saturday Evening Post only) emanating from Louisiana was:
Subscription circulation .99%
Subscription revenue .91%
Newsstand circulation .87%
Newsstand revenue .86%
Advertising pages .09%
Newsstand circulation 5,000-6,000
copies
Subscription circulation 54,000-55,000
copies
The record does not include any statistics concerning the circulation in Louisiana of defendant's other publications, Ladies Home Journal, Holiday, Jack and Jill, and the American Home.
On May 21, 1964, a hearing was held on defendant's motion to dismiss. The district court denied the motion, Golino v. Curtis Publishing Co., E.D.La.1965, 248 F.Supp. 576, but by its judgment certified an interlocutory appeal pursuant to Rule 54(b), Fed.R.Civ.P.
A determination of when a non-resident publisher may properly be brought into the courts of a state involves, as do all due process examinations, the resolution of a broad question of policy. What "minimum contacts" with a state will render such a publisher amenable to service of process is dependent to a large degree upon the equities of the situation. The ultimate goal is that justice prevail, and the courts' concept of what constitutes minimum contacts will be molded to meet the needs of justice.2 A clear enunciation of this policy has been adopted by the Supreme Court as the "standard" by which assertions of jurisdiction over non-resident corporations must be measured:
Due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice."
International Shoe Co. v. State of Washington, 1945, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95, 101.3 When this broad policy is applied to specific facts, decisions are rendered which guide future tribunals in deciding similar questions as they arise. In applying these precedents, however, the judge and the attorney must always keep in mind the basis of the prior decisions — a desire to effectuate the underlying constitutional policy. It is always this underlying policy which must control the application of precedent, just as it must guide the creation of future precedent. Approaching our present case in this spirit, we are convinced that "notions of fair play and substantial justice" require rather than foreclose the decision reached by the district court.4 The decisions of this Court cited by appellant as requiring a contrary result clearly do not do so when interpreted and applied in light of the underlying constitutional policy which they were written to effectuate.
Appellant places primary reliance upon Buckley v. New York Times Co., 5th Cir. 1964, 338 F.2d 470, and New York Times Co. v. Connor, 5th Cir. 1966, 365 F.2d 567. Both cases involved libel actions against The New York Times — one by Buckley, a Louisiana citizen, and the other by Connor, a citizen of Alabama.5 The contacts of The Times with Louisiana were enumerated by the Court in Buckley as follows:
The New York Times Company sic is edited and published in New York and is sent directly to subscribers and independent distributors from New York. The Times Company has no office or resident agents or employees in Louisiana of any kind. The only connections of the Times Company with Louisiana are: the sending of less than a thousandth of one per cent, in the aggregate, of its newspapers from New York to subscribers and to independent distributors in Louisiana; the occasional solicitation of advertising (an amount less than one thousandth of one per cent, in the aggregate) by traveling representatives; two trips were made in 1960, three in 1961 and four in 1962; and the occasional sending of staff reporters to Louisiana on special assignment (there are no regular Times reporters in Louisiana); this occurred eight times in 1960, twice in 1961 and eleven times in 1962.
338 F.2d at 473-474. As the Connor court pointed out, the contacts in the case before it were "virtually identical" with those listed in Buckley.6 New York Times v. Connor, supra, 365 F.2d at 570. Both courts held that, on the facts before them, the respective state long-arm statutes could not constitutionally be applied to the Times. The Buckley court, in reaching this conclusion, stated:
The law is well settled that the mere circulation of a periodical through the mails to subscribers and independent distributors constitutes neither doing business nor engaging in a business activity.
338 F.2d at 474. This language was cited, and Buckley held controlling, by the Court in Connor, 365 F.2d at 570. It is upon this language that appellant most strongly relies. We are convinced, however, that such reliance is misplaced, as valid factual distinctions in the instant case require a different legal result. These distinctions are predicated upon basic differences between the business activities, purposes, and motivations of a publisher of a newspaper, albeit one of world-wide influence, and a publisher of national magazines.
The existence of a newspaper, no matter how popular, depends primarily upon circulation in the vicinity of its publication. Circulation in other areas may well be welcomed, but it is not critical to the newspaper's continued existence. Circulation beyond the vicinity of publication can be characterized as "passive" in that it is a product of the publication's excellence rather than of a business effort of active solicitation in all areas of the nation.7 Such is not the case with a publisher of a national magazine. The primary function of such a business is to sell as many magazines as possible in every state of the union, and to that end the corporation actively directs its business.8 The publication itself, unlike a newspaper, is not prepared primarily for local consumption, but rather for a nationwide audience. Curtis would certainly not argue that the Saturday Evening Post is published for the consumption of readers in Pennsylvania, its place of publication, more than for those in Oregon, Illinois, or Louisiana.
Any resolution of the issue before us must take into account these basic differences between the businesses of publishing a newspaper and a national magazine; and precedent dealing with one type of business should not control cases involving the other unless it can be shown that such an application supports the underlying constitutional policy. Thus, the language of Buckley relied upon by appellants must be viewed in its factual context and applied with the above admonitions in mind. Ignoring these considerations, appellant argues that the statement of the Buckley court quoted above stands for the proposition that circulation alone may never give rise to contacts sufficient to satisfy the due process requirement. The logical defect in this interpretation can, however, be readily demonstrated. Under appellant's reading of Buckley,...
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