Schiavone v. Fortune

Decision Date18 June 1986
Docket NumberNo. 84-1839,84-1839
Citation91 L.Ed.2d 18,477 U.S. 21,106 S.Ct. 2379
PartiesRonald A. SCHIAVONE, Genaro Liguori and Joseph A. DiCarolis, Petitioners v. FORTUNE, aka Time, Incorporated
CourtU.S. Supreme Court
Syllabus

Petitioners instituted diversity libel actions on May 9, 1983, by filing their respective complaints in the Federal District Court for the District of New Jersey. Each complaint alleged that the plaintiff was libeled in a story that appeared in the May 31, 1982, issue of Fortune magazine, and described Fortune as "a foreign corporation having its principal offices at Time and Life Building" in New York City. On May 20, the complaints were mailed to Time's registered agent in New Jersey, who received them on May 23 but refused service because Time was not named as a defendant. On July 19, 1983, each petitioner amended his complaint to name as the captioned defendant, and to refer in the body of the complaint to, "Fortune, also known as Time, Incorporated." The amended complaints were served on Time by certified mail on July 21. The District Court dismissed the complaints under the New Jersey statute of limitations, which requires a libel action to be commenced within one year of the publication of the alleged libel. The court held that, although the amended complaints adequately named Time as a defendant, the amendments did not relate back, under Federal Rule of Civil Procedure 15(c), to the filing of the original complaints because it had not been shown that Time received notice of the institution of the actions within the period provided by New Jersey law. On consolidated appeals, the Court of Appeals affirmed.

Held: The actions were properly dismissed. Pp. 27-32.

(a) Even if this Court adopted the "identity-of-interest" exception under which an amendment that substitutes a related party in a complaint after the limitations period has expired will relate back to the date the original complaint was filed, the facts of this case do not fall within that exception. Neither Fortune nor Time received notice of the filing until after the limitations period had run, and thus there was not proper notice to Fortune that could be imputed to Time. Pp. 27-29.

(b) The July 1983 amendments to the complaints did not relate back to the May 9 filing. Under Rule 15(c) relation back is dependent upon four factors, all of which must be satisfied. Notice to Time and the necessary knowledge did not come into being "within the period provided by law for commencing an action against" Time as required by Rule 15(c). That occurred only after expiration of the applicable 1-year period. Pp. 29-32.

750 F.2d 15 (CA3 1984), affirmed.

BLACKMUN, J., delivered the opinion of the Court, in which BRENNAN, MARSHALL, POWELL, REHNQUIST, and O'CONNOR, JJ., joined. STEVENS, J., filed a dissenting opinion, in which BURGER, C.J., and WHITE, J., joined, post, p. 32.

Morris M. Schnitzer, Roseland, N.J., for petitioners.

Peter G. Banta, Hackensack, N.J., for respondent.

Justice BLACKMUN delivered the opinion of the Court.

This case primarily concerns Rule 15(c) of the Federal Rules of Civil Procedure and its application to a less-than-precise denomination of a defendant in complaints filed in federal court near the expiration of the period of limitations. Because of an apparent conflict among the Courts of Appeals,1 we granted certiorari. 474 U.S. 814, 106 S.Ct. 56, 88 L.Ed.2d 45 (1985).

I

The three petitioners instituted this diversity litigation on May 9, 1983, by filing their respective complaints in the United States District Court for the District of New Jersey. Each complaint alleged that the plaintiff was libeled in a cover story entitled "The Charges Against Reagan's Labor Secretary," which appeared in the May 31, 1982, issue of Fortune magazine. The caption of each complaint named "Fortune," without embellishment, as the defendant. See App. 8a. In its paragraph 2, each complaint described Fortune as "a foreign corporation having its principal offices at Time and Life Building, Sixth Avenue and 50th Street, New York, New York 10020." Id., at 9a. "Fortune," however, is only a trademark and the name of an internal division of Time, Incorporated (Time), a New York corporation.2

On May 20, petitioners' counsel mailed the complaints to Time's registered agent in New Jersey. They were received on May 23. The agent refused service because Time was not named as a defendant.

On July 18, 1983, each petitioner amended his complaint to name as the captioned defendant "Fortune, also known as Time, Incorporated," and, in the body of the complaint, to refer to "Fortune, also known as Time, Incorporated," as a New York corporation with a specified registered New Jersey agent. See id., at 25a, 26a. The amended complaints were served on Time by certified mail on July 21.

Time moved to dismiss the amended complaints. The District Court granted those motions. Id., at 96a, 98a, 100a. It ruled that the complaints, as amended, adequately named Time as a defendant, and therefore were not to be dismissed "for failure of capacity of defendant to be sued." Supp.App. to Pet. for Cert. 18a. Under New Jersey law, however, see N.J.Stat.Ann. 2A:14-3 (West 1952), a libel action must be commenced within one year of the publication of the alleged libel.3 Supp.App. to Pet. for Cert. 18a. State law also provides that the " 'date upon which a substantial distribution occurs triggers the statute of limitations for any and all actions arising out of that publication,' " id., at 19a, quoting MacDonald v. Time, Inc., Civil No. 81-479 (DNJ Aug. 25 1981). Supp.App. to Pet. for Cert. 19a.4 The court found it unnecessary, for purposes of the motion, to determine the precise date the statute of limitations had begun to run.

Although Time acknowledged that the original filings were within the limitations period, it took the position that it could not be named as a party after the period had expired. Time contended that a party must be substituted within the limitations period in order for the amendment to relate back to the original filing date pursuant to Rule 15(c).5

The District Court concluded that the amendments to the complaints did not relate back to the filing of the original complaints because it had not been shown that Time received notice of the institution of the suits within the period provided by law for commencing an action against it. Supp.App. to Pet. for Cert. 23a. It therefore "with great reluctance" granted the motion to dismiss, noting that any dismissal of a claim based upon the statute of limitations "by its very nature is arbitrary." Id., at 24a. The court also ruled that the "equities of this situation" did not demand that relief be afforded to petitioners. Ibid. The identity of the publisher of Fortune was readily ascertainable from the magazine itself. It rejected petitioners' contention that Time deliberately misled them to believe that Fortune was a separate corporation. It observed that petitioners created the risk by filing their suits close to the end of the limitations period. Id., at 25a.

Petitioners moved for reconsideration. By letter opinion filed January 12, 1984, the court adhered to its prior ruling. App. to Brief in Opposition 1a.

On appeal to the United States Court of Appeals for the Third Circuit, the three actions were consolidated. That court affirmed the orders of the District Court. 750 F.2d 15 (1984). It ruled that the New Jersey statute of limitations ran "on May 19, 1983, at the latest," for a "substantial distribution" of the issue of May 31, 1982, had "occurred on May 19, 1982, at the latest." Id., at 16. It regarded the language of Rule 15(c) as "clear and unequivocal." 750 F.2d, at 18. It also said: "While we are sympathetic to plaintiffs' arguments, we agree with the defendant that it is not this court's role to amend procedural rules in accordance with our own policy preferences." Ibid. It further held that the period within which the defendant to be brought in must receive notice under Rule 15(c) does not include the time available for service of process.

II

It is clear, from what has been noted above, that the three complaints as originally drawn were filed within the limitations period; that service was attempted only after that period had expired; and that the amendment of the complaints, and the service of the complaints as so amended, also necessarily took place after the expiration of the limitations period. The District Court and the Court of Appeals so found, and we have no reason to disagree. The parties themselves do not dispute these facts. Instead, their dispute centers on whether Time was sufficiently named as the defendant in the original complaints so that the service that was attempted after the 1-year period but within the time allowed for service was effective, and on whether, in any event, the amendment of the complaints related back to the original filing and accomplished the same result.

Petitioners argue that Rule 15(c)'s present form came into being by amendment in 1966 for the express purpose of allowing relation back of a change in the name or identity of a defendant when, although the limitations period for filing had run, the period allowed by Rule 4 for timely service had not yet expired. Brief for Petitioners 5. The Rule was effected, it is said, to ameliorate literal and rigid application of limitations periods to both claim and party amendments. It is urged that the Rules of Civil Procedure should be applied and construed to yield just determinations, that is, determinations on the merits, and that a procedural "double standard" that bars relation back for late notice to a new defendant when a like notice to the original defendant would be timely is unacceptable. Petitioners further argue that the original party named here and the party sought to be substituted had such commonality of interest that notice to one was in fact notice to the other. Therefore, it is said,...

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