United States Court of Appeals

FOR THE EIGHTH CIRCUIT

97-3707EMSL

In re: Federal Fountain, Inc., *

*

Debtor. *

* Appeal from the United States

----------------------------------------------- * District Court for the

* Eastern District of Missouri

David A. Warfield, Trustee of the Estate *

of Federal Fountain, Inc., *

*

Appellant, *

*

v. *

*

KR Entertainment, Inc., *

*

Appellee. *

ORDER

On the Court's own motion, the opinion and judgment dated May 5, 1998 are vacated. The attached

opinion is being filed in its stead.

May 11, 1998

Order Entered at the Direction of the Court:

Clerk, U.S. Court of Appeals, Eighth Circuit
United States Court of Appeals

FOR THE EIGHTH CIRCUIT

No. 97-3707EMSL

In re: Federal Fountain, Inc., *

*

Debtor. *

* Appeal from the United States

------------------------------ * District Court for the

* Eastern District of Missouri

David A. Warfield, Trustee of *

the Estate of Federal Fountain, *

Inc., *

*

Appellant, *

*

v. *

*

KR Entertainment, Inc., *

*

Appellee. *

 ORDER

On the Court's own motion, the opinion and judgment dated

May 5, 1998 are vacated. The attached opinion is being filed in

its stead.

May 11, 1998

Order Entered at the Direction of the Court:

Clerk, U.S. Court of Appeals, Eighth Circuit
United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 97-3707

___________

In re Federal Fountain, Inc., *

*

Debtor. *

___________________________ *

*

David A. Warfield, Trustee of the *

Estate of Federal Fountain, Inc., *

* Appeal from the United States

Appellant, * District Court for the Eastern

* District of Missouri.

v. *

*

KR Entertainment, Inc., *

*

Appellee. *

___________

Submitted: April 16, 1998

Filed: May 11, 1998

___________

Before WOLLMAN, BEAM, and MORRIS SHEPPARD ARNOLD, Circuit Judges.

___________

MORRIS SHEPPARD ARNOLD, Circuit Judge.

Federal Fountain, Inc. (represented by its trustee in bankruptcy, David A.

Warfield), and KR Entertainment, Inc., entered into a contract under which Federal

Fountain agreed to design and install certain equipment necessary for the operation of
The Honorable Catherine D. Perry, United States District Judge for the Eastern 1

District of Missouri.

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KR's water entertainment show in the Riviera Hotel in Las Vegas, Nevada. While

involved in bankruptcy proceedings, see 11 U.S.C. §§ 701-766, Federal Fountain filed

suit to collect the balance due on the contract. KR moved to dismiss for lack of

personal jurisdiction and the district court granted the motion. Federal Fountain 1

appealed. We affirm.

Fed. R. Bankr. P. 7004(d) provides that "[t]he summons and complaint and all

other process except a subpoena may be served anywhere in the United States." 

Several appellate courts have held that this provision, and similar ones that provide for

national service of process, will not offend the Constitution in a particular case if there

are certain minimum contacts between the defendant and the United States of

America. See, e.g., Busch v. Buchman, Buchman & O'Brien, 11 F.3d 1255, 1258 (5th

Cir. 1994); Diamond Mortgage Corp. v. Sugar, 913 F.2d 1233, 1244 (7 Cir. 1990), th

cert. denied, 498 U.S. 1089 (1991); and Mariash v. Morrill, 496 F.2d 1138, 1143,

1143 n.7 (2 Cir. 1974). nd

We have, however, adopted a different view. We have held instead that

International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945), requires " 'in every

case' " that there be minimum contacts between the defendant and the state in which

the defendant is expected to answer. South Dakota v. Kansas City Southern

Industries, Inc., 880 F.2d 40, 44 n.10 (8 Cir. 1989), cert. denied, 493 U.S. 1023 th

(1990), quoting Reynolds Metals Co. v. Columbia Gas System, Inc., 694 F. Supp.

1248, 1250 (E.D. Va. 1988) (emphasis in Reynolds). After stating this principle, we

proceeded to consider the defendant's contacts with the state of South Dakota to

determine whether personal jurisdiction over the defendant was properly acquired. 

Kansas City Southern, 880 F.2d at 44 n.10. We have thus squarely held that service

of process outside the forum state under a national service of process statute confers

personal jurisdiction over
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a defendant only if that defendant has the requisite minimum contacts with the forum

state. 

Federal Fountain asks us to interpret Kansas City Southern differently. It

contends first that in that case we were simply interpreting the Clayton Act and that

the phrase "in every case" refers to every case that arises under that act. Federal

Fountain also seems to argue that our analysis of the defendant's contacts with the

forum state in Kansas City Southern had to do with the issue of venue, that is, with

the question of whether the defendant there was "transact[ing] business" in the forum

state, and not with the issue of personal jurisdiction. See 15 U.S.C. § 22. We reject

both of these contentions.

The principle applied in Kansas City Southern, 880 F.2d at 44 n.10, as the

court plainly stated, was that personal jurisdiction may not be established over a

defendant unless that defendant has certain minimum contacts with the state in which

the federal court is sitting. It is true that in determining that jurisdiction was proper,

we relied on facts that the district court found in deciding that there was proper venue. 

Id. But there is no indication there that we were inquiring into the venue issue for its

own sake. Indeed, it is clear that we were not. 

Nor have we ever approved the approach taken by the Fourth and Eleventh

Circuits, under which a court that applies a statute permitting national service of

process first inquires whether the proposed forum puts the defendant at a " 'severe

disadvantage' " in defending the action. See, e.g., Republic of Panama v. BCCI

Holdings, 119 F.3d 935, 948 (11 Cir. 1997), quoting McGee v. International Life th

Insurance Co., 355 U.S. 220, 223 (1957); see also ESAB Group, Inc. v. Centricut,

Inc., 126 F.3d 617, 627 (4 Cir. 1997), cert. denied, 118 S. Ct. 1364 (1998). If so, th

the court then performs a "balancing" test, weighing the inconvenience to the

defendant against something called the "federal interests" in litigating the matter in the

particular forum. Republic of Panama, 119 F.3d at 946; see also ESAB Group, Inc.,

126 F.3d
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at 627. Kansas City Southern, in any case, forecloses our resort to this way of

deciding the matter, even if we were inclined to do so.

Because Federal Fountain "adduced no evidence indicating what contacts, if

any, [KR] has with the State of Missouri," In re Federal Fountain, Inc., 212 B.R.

960, 962 (E.D. Mo. 1997), the district court properly dismissed the case for lack of

personal jurisdiction. We therefore affirm the judgment of the district court.

BEAM, Circuit Judge, concurring specially, with whom MORRIS SHEPPARD

ARNOLD, Circuit Judge, joins, concurring.

I concur in the opinion of the court because South Dakota v. Kansas City

Southern Industries requires the result we reach. However, in my view, Kansas City

Southern was wrongly decided for reasons advanced by the Second, Fifth and Seventh

Circuits and, to a lesser extent, the Fourth and Eleventh Circuits as well.

A true copy.

Attest:

 CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.