Seymour v. Parke, Davis & Company

• Decision Date: 22 January 1969
• Docket Number: Civ. A. No. 2881.
• Citation: 294 F. Supp. 1257
• Parties: Helen L. SEYMOUR, Executrix and Ancillary Executrix of the Will of Maurice R. Seymour v. PARKE, DAVIS & COMPANY.
• Court: U.S. District Court — District of New Hampshire

294 F. Supp. 1257

Helen L. SEYMOUR, Executrix and Ancillary Executrix of the Will of Maurice R. Seymour v. PARKE, DAVIS & COMPANY.

Civ. A. No. 2881.

United States District Court D. New Hampshire.

January 22, 1969.

E. Paul Kelly and John J. Sheehan, Sheehan, Phinney, Bass & Green, Manchester, N. H., for plaintiff.

Martin L. Gross, Sulloway, Hollis, Godfrey & Coden, Concord, N. H., for defendant.

MEMORANDUM AND ORDER

BOWNES, District Judge.

This is an action for personal injury and wrongful death allegedly caused by ingestion of a certain drug manufactured by the defendant. The plaintiff is a resident and citizen of the Commonwealth of Massachusetts, acting as ancillary executrix and on behalf of her decedent who was also a Massachusetts resident and citizen at all times pertinent to this action up to and at the time of his death. The defendant is a Michigan corporation which markets its products throughout the country, including the State of New Hampshire. The drug taken by the decedent was prescribed by a Massachusetts physician, purchased in a Massachusetts retail drug store, and used by the decedent in Massachusetts. In brief, except for the initiation of this action, all of the facts on which the action is based are firmly anchored in the Bay State.

Service was made upon the defendant under the provisions of the New Hampshire "long-arm" statute, pursuant to Federal Rule 4(d) (7). The "long-arm" statute provides, in substance, that service of process may be made upon the Secretary of State as the constructive agent of a foreign corporation which transacts business within the state but has not appointed its own registered agent for service of process. N.H.Rev. Stat.Ann., ch. 300:11 and 300:12.¹ It is clear that the sole purpose for bringing this action in the District Court for the District of New Hampshire is to circumvent the Massachusetts statutes of limitations relative to wrongful death and personal injury, with the hope that the longer New Hampshire limitation period would, under some theory of conflict of laws, be applied by this Court.²

The defendant has moved to dismiss on several grounds, primarily for reason of failure of jurisdiction, alleging that the New Hampshire "long-arm" statute violates due process as utilized in this instance because "there is no rational nexus between material elements of the case and the State of New Hampshire * * *." This Court is thus faced with a unique problem of jurisdiction brought about solely because of the difference between the statutes of limitations of the neighboring states of Massachusetts and New Hampshire. We are asked to define the due process limitations upon a state's exercise of in personam jurisdiction over foreign corporations where both litigants are non-residents of the forum state and have no particular contacts or ties with it.

The amenability of a foreign corporation to suit in a federal court in a diversity action, under Federal Rule 4(d) (7), is determined in accordance with the law of the forum state. Federal law becomes controlling only if the local statute purports to assert jurisdiction beyond the due process boundaries set by the fourteenth amendment. See Arrowsmith v. United Press International, 320 F.2d 219, 6 A.L.R.3d 1072 (2nd Cir. 1963); Sanders Associates, Inc. v. Galion Iron Works & Mfg. Co., 304 F.2d 915 (1st Cir. 1962); Pulson v. American Rolling Mill Co., 170 F.2d 193 (1st Cir. 1948).

The New Hampshire "long-arm" statute has been the subject of several recent decisions, both state and federal,³ and by explicit language of the New Hampshire Supreme Court, that statute was construed to extend to the outer periphery of due process limits. Roy v. North American Newspaper Alliance, Inc., 106 N.H. 92, 205 A.2d 844 (1964). However, the New Hampshire court has never been called upon to consider the effect or limits of that statute under the circumstances that are now before this court, i. e., where the plaintiff and defendant are both non-residents;⁴ but the New Hampshire Supreme Court made it clear in the Roy case that the New Hampshire "long-arm" statute would reach as far as due process would allow to protect the interests of its own citizens. 106 N.H. 92 at 97, 205 A.2d 844.⁵ Such is not the use of the statute that is contested in this case. Even though the New Hampshire statute is intended to reach as far as allowed by due process, I rule that under the facts of this case the lack of any New Hampshire interest in this litigation renders service under N.H.Rev.Stat.Ann. 300:11 and 300:12 defective for due process reasons, and compels dismissal for lack of jurisdiction of this court. In so ruling I wish to make it explicitly clear that if either this plaintiff were, or her decedent had been a bona fide resident of New Hampshire, there would be no such due process barrier.

It would indeed be less than candid to fail to acknowledge that this ruling may be one of first impression. Diligent search by the Court for recent cases considering the precise question now before us has been unavailing.⁶ Nevertheless, I feel that this ruling is compelled by reason and logic, justified under federal law, uncontradicted by the opinions of the First Circuit and the Supreme Court, and supported, at least in part, by recent decisions of the Fifth, Sixth, Eighth and Ninth Circuits.⁷

Historically, the primary function of diversity jurisdiction was to provide a "neutral" forum for the out-of-state litigant who feared that the state court might be unduly, if unconsciously and articulately, solicitous of its own citizens' interests. Caso v. Lafayette Radio Electronics Corp., 370 F.2d 707 (1st Cir. 1966). And in this light, so that substantive rights would not be substituted or violated, the progeny of the Erie doctrine developed and refined the rules as to the law to be applied in the federal court, continually retreating from "conclusionary labels or mechanical solutions * * * and increasingly emphasizing consideration and accommodation of the basic state and federal policy goals involved." Allstate Insurance Co. v. Charneski, 286 F.2d 238, 243 (7th Cir. 1960). Fairness was the desired objective—"forum shopping" was condemned; and thus the local forum's conflict of laws rules were included within the ambit of "substantive" or non-federal law.⁸ To allow a non-resident plaintiff to proceed against a non-resident defendant, where neither party has any particular contacts with the forum state, merely to circumvent an unfavorable statute of limitations would inevitably lead to a thorough and complete perversion of fundamental principles of diversity jurisdiction, comity, and fairness—a result as illogical as it is unreasonable, and totally lacking in fairness.

The Constitution which was ordained "to form a more perfect union," contemplates that the boundaries between the states shall have continued significance for some purposes though not for all. If one State may, without violation of the due process clause, extend the authority of its courts beyond its boundaries over persons and situations not sufficiently related to that State, the separate identity of the States will be reduced to a mere fiction. Individual states could undertake at the expense of other States to enlarge the sphere of their authority to nationwide dimensions. It requires no flight of fancy to foresee the resulting maze of lawsuits adjudicating the interests of persons having only the faintest and most remote links with the State exercising authority. If the due process clause is not effective to restrain such extensions of local power, then the federal system is likely to be transformed into something very different from anything we have known. Curtis Publishing Co. v. Birdsong, 360 F.2d 344, 347-348 (5th Cir. 1966), quoting Judge Sobeloff in Erlanger Mills, Inc. v. Cohoes Fibre Mills, 239 F.2d 502, 509 (4th Cir. 1956).

Moreover, to allow jurisdiction under these circumstances would extend an open invitation to Massachusetts residents to bring personal injury actions in the District Court of New Hampshire whenever the Massachusetts two-year statute of limitations has barred action in the courts of the Commonwealth. The continuing and mainly successful assault on the requirement of privity in warranty actions and the increasing acceptance of the doctrine of strict liability in cases against manufacturers of products sold and advertised on a nation-wide basis makes this a very real consideration for this Court.

The Court has been unable to find, and counsel have failed to cite, any cases where a federal district court has taken jurisdiction under these, or similar, facts. It should be noted that the plaintiff has (or had until the statute of limitations barred her) the choice of three forums in which to proceed: (1) the State Courts of the Commonwealth of Massachusetts; (2) the Federal District Court for the District of Massachusetts; and, (3) the Federal District Court for the District of Michigan in which the defendant is incorporated.

The federal law which controls this Court's decision derives primarily from the line of cases supporting the expanded reach of permissive state court jurisdiction, beginning with International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), and culminating in McGee v. International Life Ins. Co., 355 U.S. 220, 78 S. Ct. 199, 2 L.Ed.2d 223 (1957). Those cases unquestionably established that a state might well, consistent with due process, exercise in personam jurisdiction over a foreign corporation by the use of a "long-arm" statute, though the corporation's contacts within the forum state are minimal, provided, that the defendant corporation's activities show sufficient "contact" with the state so that it is reasonable to require the corporation to answer suit there. See Caso v. Lafayette Radio Electronics Corp., 370 F.2d 707 (1st Cir. 1966). But:

While the trend expanding the reach of permissive state court

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