Source: http://www.chanrobles.com/usa/us_supremecourt/319/448/case.php
Timestamp: 2017-12-18 03:21:24
Document Index: 141940295

Matched Legal Cases: ['§ 28', '§ 71', '§ 4', '§ 15', '§ 4', '§ 4', '§ 4', '§ 4', '§ 38', '§ 81', '§ 112', '§ 11', '§ 4', '§ 15', '§ 43', '§ 104', '§ 35', '§ 35', '§ 25', '§ 164', '§ 4']

Petitioner is a resident of Ohio; respondent is a Massachusetts corporation. Respondent brought an action at law against petitioner in the Superior Court of Massachusetts for breach of a contract. Petitioner was personally served when he happened to be in Boston. chanroblesvirtualawlibrary
Petitioner appeared specially and caused the action to be removed to the federal District Court in Massachusetts, petitioner being a nonresident of Massachusetts and there being diversity of citizenship and the requisite jurisdictional amount. Judicial Code § 28, 28 U.S.C. § 71. Petitioner thereupon entered a general appearance [Footnote 1] -- he answered, interposing several defenses, including res judicata; he also filed a counterclaim. He then moved for a summary judgment. Shortly before that motion came on to be heard, respondent moved to amend its declaration by adding a complaint for treble damages under § 4 of the Clayton Act. [Footnote 2] 38 Stat. 731, 15 U.S.C. § 15. The District Court granted petitioner's motion for summary judgment. 41 F.Supp. 461. But it denied respondent's motion to amend, being of the view that it had no jurisdiction to allow the amendment. 42 F.Supp. 938. In reaching that result, the District Court expressed doubts that the venue requirements of § 4 of the Clayton Act were satisfied. But it expressly declined to rest on that basis, and placed its decision solely on the Lambert Co. line of cases. On appeal, the Circuit Court of Appeals sustained the ruling of the District Court on the motion for summary judgment, but disagreed with its view on the motion to amend. 131 F.2d 190. The case is here on a petition for a writ of certiorari which we granted because of the importance of the problem and chanroblesvirtualawlibrary
The Lambert Co. case and those which preceded [Footnote 4] and followed it merely held that defects in the jurisdiction of the state court either as respects the subject matter or the parties [Footnote 5] were not cured by removal, but could thereafter be challenged in the federal court. We see no reason in precedent or policy for extending that rule so as to bar amendments to the complaint, otherwise proper, merely because they could not have been made if the action had remained in the state court. [Footnote 6] If the federal court has jurisdiction of the removed cause, and if the amendment to the complaint could have been made had the suit originated in the federal court, the fact that the federal court acquired jurisdiction by removal does not deprive it of power to allow the amendment. Though this suit, as instituted, involved only questions of local law, it could have been brought in the federal court by reason of diversity of citizenship. [Footnote 7] The rule of 304 U. S. 320. The forms and modes of proceeding are governed by federal law. Thompson v. Railroad Companies, 6 Wall. 134; Hurt v. Hollingsworth, 100 U. S. 100; West v. Smith, 101 U. S. 263; King v. Worthington, 104 U. S. 44; Ex parte Fisk, 113 U. S. 713; Northern Pacific R. v. Paine, 119 U. S. 561; Twist v. Prairie Oil & Gas Co., 274 U. S. 684; Rorick v. Devon Syndicate, Ltd.,@ 307 U. S. 299. Congress has indeed provided that in a suit which has been removed the District Court shall
It is said, however, that the amendment in question may not be made, since the cause of action authorized by § 4 of the Clayton Act may be brought only in a District chanroblesvirtualawlibrary
But we need not rest on that narrow ground. Petitioner was personally served in the state court action. After the removal of the cause, he entered a general appearance and defended on the merits. He also filed a counterclaim in the action. He thus invoked the jurisdiction of the federal court, and submitted to it. Merchants' Heat & L. Co. v. Clow & Sons, 204 U. S. 286. He was accordingly "found" in the district, so as to give the District Court power to allow the complaint in that suit to be amended by adding a cause of action under § 4 of the Clayton Act. This venue provision was designed, as stated by Judge chanroblesvirtualawlibrary
Learned Hand in Thorburn v. Gates, 225 F.6d 3, 615,
But "found" in the venue sense does not necessarily mean physical presence. We noted in Neirbo Co. v. Bethlehem Shipbuilding Corp., supra, pp. 308 U. S. 170-171, that a corporation may be "found" in a particular district for venue purposes merely because it had consented to be sued there. The fact that it was present "only in a metaphorical sense" (308 U.S. p. 308 U. S. 170) was not deemed significant. In the present case, it is not important that, at the time of this amendment, petitioner had returned to Ohio and was not physically present in Massachusetts. He was conducting litigation in Massachusetts. He was there for all purposes of that litigation. Having invoked the jurisdiction of the federal court and submitted to it, he may not claim that he was present only for the limited objectives of his answer and counterclaim. He was present, so to speak, for all phases of the suit. That presence satisfies the venue provision of § 4 of the Clayton Act for the purpose of this amendment. The Rules of Civil Procedure are applicable to removed cases, and "govern all procedure after removal." Rule 81(c). They permit joinder of claims (Rule 18), and contain the procedure for amendment of pleadings. Rule 15. And, as we have noted, Congress has directed the District Court, after a case has been removed, to "proceed therein as if the suit had been originally commenced in said district court." Judicial Code § 38, 28 U.S.C. § 81. There can be no doubt but that the court had the power under that statute and under the Rules to permit the joinder of the cause of action under the Clayton Act. If petitioner was subject to the jurisdiction of the court for purposes of the law suit, including an amendment chanroblesvirtualawlibrary
See Noma Electric Corp. v. Polaroid Corp., 2 F.R.D. 454; Carroll v. Warner Bros. Pictures, Inc., 20 F.Supp. 405; Howe v. Atwood, 47 F.Supp. 979, 984. Cf. Newberry v. Central of Georgia Ry. Co., 276 F.3d 7, 338.
Congress has power, of course, to authorize a suit arising under federal law to be brought in any of the federal district courts. Robertson v. Labor Board, 268 U. S. 619, 268 U. S. 622. But, from the beginning of the federal judicial system, Congress has provided that civil suits can be brought only in the district where the defendant is an inhabitant, except that, where federal jurisdiction is based solely upon diversity of the parties' citizenship, suit may be brought in the district of the residence of either the plaintiff or the defendant. Section 51 of the Judicial Code, 28 U.S.C. § 112, derived from § 11 of the Judiciary Act of 1789, 1 Stat. 73, 79. Only in a very few classes of cases has Congress given a strictly limited right to sue elsewhere. Robertson v. Labor Board, supra. In § 4 of the Clayton Act of October 15, 1914, 38 Stat. 731, 15 U.S.C. § 15, the legislation immediately before us, suits are authorized to be brought "in any district court of the United States in the district in which the defendant resides or is found or has an agent. . . ." Similar provisions, permitting suit where the defendant is "found," appear in the Act of March 3, 1911, § 43, 36 Stat. 1087, 1100, 28 U.S.C. § 104 (suits for penalties and forfeitures), the Act of March 4, 1909, § 35, 35 Stat. 1075, 1084, 17 U.S.C. § 35 (suits for copyright infringement), the Act of February 5, 1917, § 25, 39 Stat. 874, 893, 8 U.S.C. § 164 (suits under the chanroblesvirtualawlibrary
The Court relies upon Rules 15 and 18 of the Federal Rules of Civil Procedure, which establish liberal rules for the joinder of causes of action. But these Rules do not dispense with the requirements of venue. Rule 82 explicitly provides that "[t]hese rules shall not be construed to extend or limit the jurisdiction of the district courts of the United States or the venue of actions therein." Because causes of action could be joined, if properly brought, does not prove that they are properly brought. A liberal rule regarding joinder of actions does not eliminate the problems of suability created by the various venue provisions. The removal statute itself does not chanroblesvirtualawlibrary
Joinder is permissible only if the causes of action are properly in court -- that is, if the requirements of venue as well as jurisdiction are satisfied. If these requirements are not met, an order of court directing joinder cannot dispense with them. The respondent here sought to add a cause of action for treble damages under § 4 of the Clayton Act -- a cause of action over which the district court in Massachusetts could have venue only if the petitioner resided in Massachusetts, or was found there either in person or through an accredited agent. But, at the time of the proposed amendment to the complaint seeking chanroblesvirtualawlibrary
The case therefore reduces itself to this: if the petitioner had not removed the action for breach of contract to the federal court, he could not possibly be compelled to defend a suit under the antitrust laws brought against him in Massachusetts. His mere exercise of the right of removal given him by Congress has resulted in his being chanroblesvirtualawlibrary