Pickthall v. Anaconda Copper Min. Co.
| Decision Date | 03 October 1947 |
| Citation | 73 F. Supp. 694 |
| Parties | PICKTHALL v. ANACONDA COPPER MIN. CO. et al. |
| Court | U.S. District Court — Southern District of New York |
Gerald F. Finley and Arnold B. Elkind, both of New York City, for plaintiff.
Chadbourne, Wallace, Parke & Whiteside, of New York City (Horace G. Hitchcock, of New York City, of counsel), for defendant Butte, A. & P. Ry. Co.
Defendant Butte, Anaconda and Pacific Railway Company by its attorneys appearing specially and solely for the purpose of the motion, moves to set aside the service of process and to dismiss the complaint. As the action arises under the Employers' Liability Act of the United States, 45 U.S.C.A. § 51 et seq., the motion is framed in the familiar double aspect. It attacks the jurisdiction of the court over the person of the defendant and, at the same time, claims improper venue. The questions, while not identical, are similar and may be treated together. 45 U.S.C.A. § 56 requires that an action brought under the Federal Employers' Liability Act be brought in the district of the residence of the defendant or in which the cause of action arose or "in which the defendant shall be doing business at the time of commencing such action." Jurisdiction, however, in the constitutional sense of due process must find a basis in something which the courts will recognize as sufficient to bring the foreign corporation defendant physically within the territorial limits of the district. As a matter of convenience the courts have examined into the facts of each case to ascertain, as the phrase goes, "whether the foreign corporation defendant is doing business within the state." 1 Moore's Federal Practice, pp. 315 et seq.
The complaint alleges that plaintiff's decedent was killed on November 25, 1946, while employed by defendant Butte, Anaconda and Pacific Railway Company, in interstate commerce, as a switchman in the yards of said defendant at Ramsey, Montana. It is alleged that plaintiff is a citizen of Montana residing in Butte and that the decedent was a resident of Butte, Montana, at the time of his death; also that said defendant is a corporation, incorporated under the laws of the State of Montana.
It is not disputed that the Railway Company operates a railroad located entirely in the State of Montana; it has not qualified to do business in the State of New York; it solicits no freight or passenger business in New York. The Railway Company operates about one hundred seventeen miles of track and its entire three hundred sixty-four employees, exclusive of officers and directors, are located in Montana.
As the defendant Anaconda Copper Mining Company owns all the capital stock of the Railway Company, with the exception of qualifying shares, and as the officers and certain of the directors of the Railway Company are also officers of defendant Anaconda Copper Mining Company, which maintains offices at 25 Broadway, New York City, and most of these individuals reside in the vicinity of New York City, the affairs of the Railway Company have been managed for many years in a manner which would serve the convenience of all concerned. The by-laws of the Railway Company and the testimony of Charles E. Moran, the Secretary of the Railway Company, taken pursuant to stipulation and submitted "as a primary record of the business activities of the defendant Butte, Anaconda and Pacific Railway Company in the Southern District of New York" constitute the evidence from which it is to be found that the Railway Company at the time of the service of process herein was or was not doing business in the Southern District of New York.
Cornelius F. Kelley, who resides at Manhasset, New York, is the Chairman of the Board of Anaconda and at the same time President of the Railway Company. He receives a salary of $2500 a year as President of the Railway Company which is substantially less than his compensation as Chairman of the Board of Anaconda. James R. Hobbins, who resides in New York City, is President of Anaconda and Vice-President of the Railway Company. He receives no salary in the latter capacity. James E. Woodard who also resides in New York City, is Treasurer of Anaconda and also Treasurer of the Railway Company. He receives a salary of $2500 a year as Treasurer of the Railway Company. Mr. Moran is Secretary of both Companies and receives a salary of $1000 a year as Secretary of the Railway Company. He resides in Plainfield, New Jersey.
The directors of the Railway Company are Mr. Kelley and Mr. Hobbins, above referred to, and also Robert E. Dwyer, W. H. Hoover and R. E. Brooks. Mr. Dwyer resides either in New York City or the metropolitan area and Mr. Hoover also maintains a residence there except that he "also maintains a residence in Montana and considers himself a Montana resident." Most, if not all, of the officers and directors just specified have their headquarters in the Anaconda offices at 25 Broadway, New York City. Mr. Brooks, the General Manager, is located most of the time and resides in Montana. He receives $12,000 a year for the duties which he performs pursuant to his contract with the Railway Company.
The by-laws of the Railway Company provide in Article 1, Section 3 thereof:
"All the affairs of the Company shall be managed by the Board of Directors, who shall approve & ratify all tariffs of the Company."
Article 2 provides that the annual meeting of stockholders called for the election of directors shall be held at the general office of the Company in Anaconda, Montana. Section 3 of the said Article provides with respect to regular meetings of the Board of Directors:
"Regular meetings shall be held at the general office of the Company, in the City of New York, at 11:15 o'clock A.M., on the fourth Monday of March, June, September and December of each year."
Article 3, Section 2 provides:
Articles 4 and 5 prescribe the customary duties for the Secretary and the Treasurer; and it appears that the corporate seal is commonly located in New York City in the custody of the Secretary.
The space used by the officers of the Railway Company is their regular office space as officers of Anaconda. No space in the offices of Anaconda is assigned for the special use of the Railway Company; nor does the Railway Company, so far as appears, own or lease any real estate in New York. The name of the Railway Company does not appear on the door of any office of Anaconda in New York, nor on the building directory at 25 Broadway, New York City, nor does it have a telephone listing.
The operations of the Railway in Montana are carried on in Montana from the offices of the Railway in Anaconda, Montana, by a General Manager and Superintendent, and a Chief Engineer. There is also an Assistant Secretary and Assistant Treasurer and Auditor at Anaconda, Montana, who conducts all the regular correspondence of the Railway Company in Anaconda, keeps all the books of accounts and prepares all financial statements. The payroll is kept in Montana and paid by drawing on a bank in Montana. The salaries of the officers in New York City are paid by checks drawn in Montana; and all purchases of equipment and supplies are made by the General Manager or the Assistant Treasurer in Montana.
There are no outstanding bonds which require any trustee or fiscal agent in New York, and all contracts entered into in the normal course of operations of the Railway Company are entered into in Montana.
The Railway Company maintains a bank account in New York for the purpose of paying eastern railways their portion of freight collected for them for freight transported over the line of the Railway Company in Montana on through operations, under joint tariff arrangements. Checks were drawn upon or deposits made in this bank account in connection with the payment of dividends in the years 1942, 1943, 1944 and 1945, when the account was utilized in order to clear dividend payments, declared in late December of those years,...
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