Opinion ID: 1394891
Heading Depth: 2
Heading Rank: 1

Heading: Conflicting Authority: Mayo Clinic and Wisland

Text: In the present case, we deal with the question of which state's choice-of-law rules to apply when the plaintiff initially chose an improper forum for his case. As noted by the Nebraska district court, we have published two conflicting opinions on this issue. In Mayo Clinic, the plaintiff (a citizen of Illinois) sued Mayo Clinic and two of its doctors (citizens of Minnesota) in Illinois federal court for damages arising from alleged medical malpractice that occurred in Minnesota. Mayo Clinic, 383 F.2d at 653. The defendants moved to quash the service of process and to dismiss the case for lack of personal jurisdiction; the plaintiff moved to transfer the case to federal court in Minnesota pursuant to 28 U.S.C. § 1406(a). Id. The district court granted both the motion to transfer and the motion to quash the service of process. Id. Because the district court had quashed service, the plaintiff's case could not satisfy the Minnesota statute of limitations because an action is not commenced under Minnesota law until effective service is made upon the defendants, Minn. R. Civ. P. 3.01; in effect, the grant of the motion to quash barred the plaintiff's case under Minnesota law. Id. at 654, 656. Under Illinois law, actions are commenced upon the filing of a complaint, and therefore the plaintiff had satisfied the Illinois statute of limitations. Id. at 656. We resolved the choice-of-law issue in favor of the plaintiff: We have reached the conclusion that under the facts here the law of the transferor forum should govern and that the question of commencement of the action is, therefore, governed by the law of Illinois. Id. In doing so, we noted that the plaintiff had commenced his case pursuant to Illinois law within the time limitations under either Illinois or Minnesota law (even if he had not met the precise procedural requirements for commencing a case under Minnesota law within that state's statute of limitations). Id. The plaintiff had also diligently sought to comply with Minnesota procedural requirements for commencing an action upon transfer to Minnesota. Id. In Wisland, the plaintiff (a citizen of Wisconsin) sued the defendants (citizens of South Dakota) in Wisconsin federal court for damages arising from a motorcycle accident in South Dakota. Wisland, 119 F.3d at 734. The plaintiff commenced the action properly under Wisconsin law by filing a summons and complaint with the court, and she did so within Wisconsin's three-year statute of limitations. Id. at 735. The defendants moved to dismiss the case for lack of personal jurisdiction; by stipulation of the parties, the Wisconsin federal court transferred the case to federal court in South Dakota. Id. at 734-35. After the transfer, the defendants moved for summary judgment, arguing that the plaintiff's claim was time-barred under the South Dakota statute of limitations. Id. at 735. In South Dakota, a plaintiff's action does not commence until the defendants or the local process-serving officials actually receive the respective summonses; because those parties did not receive the summonses from the plaintiff until after the expiration of South Dakota's three-year statute of limitations, her claim would be barred under South Dakota law. Id. In that case, we ruled in favor of the defendants: A § 1406(a) transfer calls for application of the law of the transferee court . . . which in this case is the law of South Dakota. Id. at 736. We noted the rationale for this general rule  the avoidance of forum shopping by a plaintiff seeking the benefit of advantageous law in a forum where personal jurisdiction is lacking or venue is improper  and we rejected Wisland's argument that the Wisconsin federal court was, in fact, a proper venue for her case. Id. We did not cite or attempt to distinguish Mayo Clinic. We see no principled way to reconcile the respective holdings in Mayo Clinic and Wisland. The relevant facts are almost indistinguishable. In each case, the plaintiff followed the procedures to commence an action in a court that lacked personal jurisdiction over the defendants and/or was an improper venue for the case. In each case, the plaintiff filed the action within the time allowed by the statute of limitations of both the transferee forum and the transferor forum. In each case, however, a difference in the respective requirements of state civil procedure between the transferee forum and the transferor forum meant that the plaintiff's case  which was properly commenced within the applicable statute of limitations in the transferor forum  was not properly commenced within the applicable statute of limitations in the transferee forum. In short, there are no factual or legal distinctions sufficient to allow us to harmonize these cases. [2] With regard to the question of which forum's statute of limitations to apply in a case transferred under § 1406(a), they stand in conflict. While we may not resolve this conflict by overruling a decision of another panel of this court, we may choose which precedent to follow. Kostelec v. State Farm Fire & Cas. Co., 64 F.3d 1220, 1228 n. 8 (8th Cir.1995). The rule expressed in Wisland represents the prevailing law in our sister circuits, and we believe we should consider Wisland as the controlling law on this appeal. In the forty years since we decided Mayo Clinic, no circuit has followed its call to apply the law of the transferor forum to rescue a case with jurisdictional defects in the original court from a statute of limitations bar in the transferee forumincluding our own. See, e.g., Doering ex rel. Barrett v. Copper Mountain, Inc., 259 F.3d 1202, 1209 (10th Cir.2001) (When the transferor court lacks personal jurisdiction . . . the choice of law rules of the transferee court apply.); Wisland, 119 F.3d at 736 (A § 1406(a) transfer calls for application of the law of the transferee court. . . .); Schaeffer v. Village of Ossining, 58 F.3d 48, 50 (2d Cir.1995) (Following a section 1406(a) transfer, . . . the transferee court should apply whatever law it would have applied had the action been properly commenced there.) (quotation omitted); Myelle v. Am. Cyanamid Co., 57 F.3d 411, 413 (4th Cir.1995) ([I]t is well settled in this circuit that a district court receiving a case under . . . § 1406(a) must apply the law of the state in which it is held rather than the law of the transferor district court.) (quotation omitted); Tel-Phonic Servs., Inc. v. TBS Int'l, Inc., 975 F.2d 1134, 1141 (5th Cir.1992) (Following a section 1406(a) transfer, regardless of which party requested the transfer or the purpose behind the transfer, the transferee court must apply the choice of law rules of the state in which it sits.) (quotation and alteration omitted); Manley v. Engram, 755 F.2d 1463, 1467 (11th Cir.1985) (When a transfer . . . is granted pursuant to § 1406(a), . . . the transferee court must apply the choice of law rules of the state in which it sits.) (quotation omitted); Nelson v. Int'l Paint Co., 716 F.2d 640, 643-44 (9th Cir.1983) (We decline to follow Mayo Clinic; it is a minority view. . . .); Martin v. Stokes, 623 F.2d 469, 472 (6th Cir.1980) ([F]ollowing a transfer under § 1406(a), the transferee district court should apply its own state law rather than the state law of the transferor district court.) Our sister circuits' apparently universal agreement on this general rule is grounded in well-established choice-of-law principles. The plaintiff has the choice of the initial forum. If he chooses an improper venue or one that lacks personal jurisdiction over the defendants, then application of the law of the original, legally defective forum upon transfer to a legally appropriate forum carries dual risks. First, it may create unfairness to defendants. A defendant in such a situation does not expressly or impliedly consent to suit in the defective forum, yet she would be made to suffer the choice-of-law consequences of a plaintiff's mistake in choosing such a forum to file his lawsuit. [3] Second, a rule calling for application of the law of the defective forum may encourage procedural gamesmanship among plaintiffs generally. Such a rule creates an incentive for plaintiffs to engage in undue forum shopping; that is, it opens the possibility for a plaintiff to intentionally file a case in a forum with advantageous law (but without venue and/or personal jurisdiction), with the knowledge that he will receive the benefits of the law so long as he can convince the original district court to transfer the case rather than dismiss it outright. See Wisland, 119 F.3d at 736. Therefore, we agree with our sister circuits that the general rule expressed in Wisland, and not the rule expressed in Mayo Clinic, is the more logical and well-reasoned approach to choice-of-law determinations following a § 1406(a) transfer.