Document: 456 U.S. 694 102 S.Ct. 2099 72 L.Ed.2d 492 INSURANCE CORP. OF IRELAND, LTD. et al., Petitioners,v.COMPAGNIE des BAUXITES de GUINEE. No. 81-440. Argued March 23, 1982. Decided June 1, Syllabus Federal Rule of Civil Procedure 37(b)(2)(A) provides that a district court, as sanction for failure to comply with discovery orders, may enter "[a]n order the matters regarding which [discovery] was made or any other designated facts shall be taken established purposes action in accordance claim party obtaining order." Asserting diversity jurisdiction, respondent, Delaware corporation its principal place business Republic Guinea, filed suit against various insurance companies United States District Court Western Pennsylvania recover on interruption policy. When certain defendants (a group foreign companies, including petitioners) raised defense lack personal respondent attempted use establish jurisdictional facts. After petitioners repeatedly failed court's orders production requested information, court warned them unless they complied by specified date, it would assume, pursuant 37(b)(2)(A), had jurisdiction. again comply, imposed sanction, and Appeals affirmed, concluding imposition fell within trial discretion under did not violate petitioners' due process rights. Held: 1. applied support finding jurisdiction without violating process. Unlike subject-matter is an Art. III well statutory requirement, requirement have flows from Due Process Clause protects individual liberty interest. Because interest, intentionally waived, reasons defendant estopped raising issue. violated rule establishing legal consequences produce evidence only if defendant's behavior will presumption "the refusal material administration but admission want merit asserted defense." Hammond Packing Co. v. Arkansas, 212 322, 351, 29 370, 380, 53 L.Ed. 530. A proper application will, matter law, such presumption. Pp. 701-707. 2. The abuse applying this case. record establishes here satisfied Rule's requirements both "just" specifically related particular "claim" at issue order. 707-709. 651 F.2d 877, affirmed. Edmund K. Trent, Pittsburgh, Pa., petitioners. Cloyd R. Mellott, respondent. Justice WHITE delivered opinion Court. 1 37(b), Rules Procedure, impose sanctions orders. Included among available is: 2 "An 37(b)(2)(A). 3 question presented case whether applicable form basis over defendant. May directed facts, proceed recalcitrant has been established? Petitioners urge process: If does party, then create judicial fiat.1 They contend also until need court; therefore, cannot provide ground sanction. In our view, are attempting logical conundrum out fairly straightforward matter. 4 * Respondent Compagnie Bauxites Guinee (CBG) corporation, 49% owned Guinea 51% Halco (Mining) Inc. CBG's where operates bauxite mines processing facilities. Halco, Pennsylvania, contracted perform administrative services CBG. These include procurement insurance. 5 1973, instructed broker, Marsh & McLennan, obtain $20 million worth cover operations Guinea. first half coverage provided Insurance Company North America (INA). second half, what referred "excess" insurance, 21 companies,2 14 (the excess insurers).3 6 McLennan Bland Payne London market. Pursuant normal practice 7 "[i]n late January February, 1974, insurer [petitioners] placing slip amount $10,000,000, $10,000,000. [Petitioners] initialed said slip, effective February 12, indicating part $10,000,000 each willing insure."4 Finding 27 Court, App. 347a. 8 Once offering fully subscribed, issued note specifying percentage agreed insure. No separate policy issued; insurers adopted INA "as far applicable." 9 Sometime after CBG allegedly experienced mechanical problems operation, resulting loss $10 million. Contending covered policies, brought when refused indemnify loss. Whatever CBG, were perhaps minor compared difficulties encountered courts. 10 December 1975, two-count asserting based citizenship. count INA; insurers. challenge answer insurers, however, number defenses, personam Subsequently, alleged became motion summary judgment insurers.5 requires account respondent's attempt demonstrate 11 Respondent's request—asking "[c]opies all policies Defendant during period 1972 31, 1975"—was served August 1976. 1977, objected, grounds burdensomeness, producing policies. Several months later, compel documents. 1978, orally overruled objections. This followed request narrowed files seeking "were in. . risk located Pennsylvania." now objected these documents their custody control; rather, kept brokers London. ordered information brokers, limiting covering 1971 date. That July 1978; given 90 days information. On November 8, additional 30 complete discovery. 24, affidavit make records, some files, offices inspection countered previously 21, noting no conscientious effort yet objection entered July, gave 60 more Judge following warning: 12 "[I]f you don't get him days, I am going saying because give requested, subsection 2(A), there jurisdiction." 115a. 13 few moments later he restated warning follows: "I assume statistics regard indicate otherwise." Id., 116a. April 19, 1979, produced, threatened "for purpose litigation Excess Insurers subject contacts 201a. Independently found two holding First, established, sufficient fall long-arm statute. Second, adopting terms contract CBG—a contract—the implicitly submit court.6 15 Except respect three Third Circuit affirmed holding, relying entirely upon validity sanction.7 America, 877 (1981). constitute limits 37(b): 16 "The scope directly 37 tailored admitted those that, insurers' unable adduce through discovery." F.2d, 885. 17 Furthermore, held rights, broader than "reasonably necessary" circumstances. 18 decision below conflicts Fifth Familia Boom Arosa Mercantil, S.A., 629 1134 (1980), we granted certiorari.8 454 963, 502, 70 377 II 19 McDonald Mabee, 243 90, 343, 61 608 (1917), another involving Holmes wrote "great caution should used let fiction deny fair play can secured pretty close adhesion fact." 91, S.Ct., 343-344. Petitioners' basic submission apply 37(b)(2) allow better fact impermissible power, where, fact, exist. represents fundamental misunderstanding nature 20 federal depends having parties. Stoll Gottlieb, 305 165, 171-172, 59 134, 137-138, 83 104 (1938); Thompson Whitman, Wall. 457, 465, 897 (1874). concepts serve different purposes, affect character requirements. fail recognize distinction between concepts—speaking instead general "jurisdiction"—although argument's strength comes conceiving courts limited controversies authority extend delineated III, § 2, cl. Jurisdiction lower further subjects encompassed grant Again, reflects constitutional source power: Apart power exists "in inferior Courts Congress time ordain establish." 22 Subject-matter then, requirement; functions restriction contributes characterization sovereign. Certain follow this. For example, parties confer court. Thus, consent irrelevant, California LaRue, 409 109, 93 390, 34 342 (1972), principles estoppel do apply, American Fire Casualty Finn, 341 6, 17-18, 71 534, 541-542, 95 702 (1951), waive failing early proceedings. Similarly, appellate raise own motion. "[T]he rule, springing inflexible exception, motion, and, exercise States, cases affirmatively appear record." Mansfield, C. L. M. Swan, 111 379, 382, 510, 511, 28 462 (1884).9 23 None true Clause. recognizes It sovereignty, liberty.10 test maintenance offend 'traditional notions substantial justice.' " International Shoe Washington, 326 310, 316, 66 154, 158, (1945), quoting Milliken Meyer, 311 463, 339, 342, 85 278 (1940). 24 right, can, like waived. supra, indicated regardless State process, appearance. variety arrangements represent express implied National Equipment Rental, Ltd. Szukhent, 375 311, 84 411, 414, 354 (1964), stated "parties agree advance court," Petrowski Hawkeye-Security Co., 350 495, 76 490, 100 639 (1956), upheld stipulation into addition, implicit agreements arbitrate. See Victory Transport Comisaria General Abastecimientos y Transportes, 336 (CA2 1964); J. Moore Lucas, Moore's Practice ¶ 4.02[3], n. (1982) listed there. state procedures find constructive voluntary procedures. Adam Saenger, 303 59, 67-68, 58 454, 458, 82 649 (1938) ("There nothing Fourteenth Amendment prevent procedure rendered cross-action plaintiff price exact condition opening plaintiff"); Chicago Life Ins. Cherry, 244 25, 29-30, 492, 493, 966 (1917) ("[W]hat acts deemed [a court's] differ"). Finally, unlike even review sua sponte, 12(h), "[a] person waived" timely responsive pleading. 25 sum, characteristics portray is—a right protecting individual. plaintiff's demonstration historical clear law—i.e., factual showings consequences—but way arise. actions not. 26 expression rights often procedural rules: rules result curtailment constitutes, 12(h)(1), waiver objection. consisting precisely same effect. As proposition, creates problem waiver. Although "a conclude persons interested mere assertion power," 29, party's "mere assertions" power. itself embodies standard 530 (1909), rules.11 There strike render default who pretrial Such permissible undoubted lawmaking bad faith untruth begotten suppression proof [T]he preservation 350-351, 380. situation distinguished Hovey Elliott, 167 409, 841, 42 215 (1897), take similar "punishment" obey pay registry sum money. Societe Internationale Rogers, 357 197, 209-213, 78 1087, 1094-1096, 1255 (1958). (see Part III), invocation presumption, thing, argue differs instances imposed, Packing, party. obligation order, comply. Until moreover, violates argument assumes something unique about prevents being waived always free ignore proceedings, judgment, collateral proceeding. Baldwin Traveling Men's Assn., 283 522, 525, 51 517, 75 1244 (1931). By submitting challenging agrees abide determination jurisdiction: res judicata 524, 517; Surety Baldwin, 287 156, 166, 98, 101, 77 234 (1932). demonstrated above, manner determines presumptions, factfinding. 31 Even remains properly circumstances Court's invoke accompanied detailed explanation Appeals, detain us long. What Hockey League Metropolitan Club, Inc., 427 639, 642, 96 2778, 2780, 49 747 (1976), here: question, course, original [applied sanction]; abused so doing" (citations omitted). follow, hold 32 contains standards—one one specific—that limit discretion. must "just"; second, While latter former restrictions 33 "just," rely following. initial 1977. Despite repeated material, able "haven't up point." 112a. possible Confronted continued delay obvious disregard invoking powers clearly appropriate. periods. instance, agreements. Third, allegation frivolous claim, substantiate not, misuse substantiality found, alternative State's Supra, 699. Fourth, ample lead proposed compliance "produce information" absence effect, simply placed burden jurisdiction.12 order; meet proof. course behavior, coupled warnings, demonstrates "justice" Neither doubt satisfies requirement. respond contention Having put option blocking reasonable surely once full extent critical proving supply supports U.S., took facts—contacts Pennsylvania—that consequence—personal defendants—follows this, appropriateness IV 35 37(b)(2), affirm Appeals. 36 So ordered. POWELL, concurring judgment. 38 rests today's "subject matter" personam" Under distinction, defines limitation contrast, characterizes solely waivable "fair play." done so, questions arise concerning 39 my view broadly theoretical misapprehends issues actually decision. Their less definition. limitations identified, becomes apparent theory could require sweeping largely unexplicated revision doctrine. encompass "sovereign" identified World-Wide Volkswagen Corp. Woodson, 444 286, 291-293, 559, 564-565, 62 490 (1980). Fair resolution broad holding. Accordingly, although concur join opinion. 40 lawsuit began petitioner Pennsylvania. Alleging averred petitioners, corporations, statute 880-881 (CA3 1981). Petitioners, denied Viewing resolve dispute. 41 Meantime, while unsuccessfully sought requests, parallel England's High Justice, Queens Bench Division. juncture current arose. Seeking enjoin English injunction protested thus lay beyond injunctive powers. But disagreed. prerequisite entry injunction, petitioners.1 characterized partly noncompliance 37(b).2 37(b) provision. recognized governing 881. fails implications central fact: relied law 43 possess warrant own. Decision Act, U.S.C. 1652, "except Constitution treaties Acts otherwise provide. ." generally Erie Tompkins, 304 64, 817, 1188 (1938). determined forum State. See, e.g., Intermeat, Poultry 575 1017 1978); Wilkerson Fortuna Corp., 554 745 (CA5), cert. denied, 434 939, 98 430, 54 299 (1977); Poyner Erma Werke Gmbh, 618 1186, 1187 (CA6 1980); Lakeside Bridge Steel Mountain Constr. 597 596 (CA7 1979), 445 907, 63 325 (1980); Lakota Girl Scout Council, Havey Fundraising Management, 519 634 (CA8 1975); Arrowsmith Press International, 320 219, 226 1963); Forsythe Overmyer, 576 779, 782 (CA9), 439 864, 99 188, 174 (1978); Quarles Fuqua Industries, 504 1358 (CA10 1974).3 44 dependence jurisdiction—a mandated 1652—its normally 782; Washington Norton Mfg., 588 441, (CA5 1979); Fisons 458 1241, 1250 1972).4 arises how restricting States. 45 Before today decisions "minimum contacts" represented unconsenting Wood son, 564-565; Hanson Denckla, 235, 251, 1228, 1238, 1283 (1958); (1945). showing minimum contacts, defendant, therefore transgress limitations. reconciled simple reliance statute—the provision Decisions Act—the relevant Amendment, Fourteenth. 46 apparently understood ways. Both involve theories justify doctrine A. 47 traditional principles, exist exercising Shaffer Heitner, 433 186, 216, 97 2569, 2586, 683 1238. establishment 37, longer defendant.5 Whenever fairness offended, upheld. 48 today, linked jointly defining assertions defendants. 292-293, see appears abandon rationale footnote. ante, 702-703, 10. address action. eschewing concept States—for, again, invoked Court—the effects potentially change law. reference abstract play. And, astonishingly me, neither argued nor briefed B Alternatively, read opinion, affecting congressionally approved vests Yet cast terms. And interpretation, either language history Rules. 50 support, embracing construction Procedure.6 suggest intended Indeed, seems construed grant: "These venue therein." Moreover, assuming remain predicate permit "fishing expedition" entitled essentially speculative allegations necessary Nor enforce case.7 me least, serious court—in case—to absent alone—unaided theories—more amply possessed adjudicate decide narrow basis. 52 adduced assertions. evidence, prima facie contacts." 881-882, 886, 9. sustain independently Pet. Cert. 51a, 53a.8 Where little difficulty adequate exist, "presumption" "waiver." ground, petition deal cross-petition response certiorari 81-290, Ireland, We cross-petition, refer cross-petitioners "petitioners" cross-respondent "respondent." described "Of Insurers, five representing domestic interests insuring risks throughout world, particularly Seven non parents, affiliates. Japan Israel nationalities Insurer Defendants. Switzerland Ireland remaining Belgium parent." 196a. Four contest 105a. dismissal complaint others. 886 challenges 81-290. One L'Union Atlantique S.A. d'Assurances, Brussels, sent slip. 20, it, conveniens. 1979. 22, instituted England, attacking contract. decision, commencement England [was] oppressive, unfair, act circumstances." 203a. It, enjoined continuation suit. aspect reversed seeks supra ). enjoining England. Gibbons dissented propriety arguing He expressed ever 892, 4. Boom, valid Personal must, held, Fourth Eighth Circuits, hand, Lekkas Liberian M/V Caledonia, 443 10, (CA4 1971); 21st Phoenix 590 723 1979). opportunity litigate reopen attack adverse long determinations—both personal. Chicot County Drainage Dist. Baxter Bank, 308 371, 317, 329 (1940); courts, element federalism sovereignty vis-a-vis 291-292, 564, stated: "[A] nonresident 'minimum contacts' turn, seen related, distinguishable, functions. burdens litigating distant inconvenient forum. ensure reach status coequal sovereigns system." (Citation omitted.) Contrary suggestion post, 713-714, alter Rather, deals needed show court-ordered sovereign ultimately function interest preserved makes mention concerns. operated independent requirement: Individual himself protected. Advisory Committee Notes provisions [Hammond 322 [29 530] (1909) ]." Final Report (1937). 209, 1094, Counsel oral argument. Tr. Oral Arg. 47-48. before actions. Zenith Radio Hazeltine Research, 395 100, 111-112, 89 1562, 1570, 129 (1969). undertaken activity bring 53a. Friendly explained leading 226: "State statutes determining corporations sued, what, whom, whimsy; most legislation balancing considerations affording wrongs connected conveniencing resident plaintiffs, avoiding discouragement corporations. Congressional mandate, unexpressed itself, balance struck states." contended refers factor entering 37(b). 708. Generally views "established rights." Ante, 706. dealt 4, methods service obtained. expressly underlying prerequisites, obtained D. Currie, 858 (2d ed. 1975). reason frequently 374 869 (1963) (statement Black Douglas, JJ., dissenting adoption amendments Procedure); 858; Foster, Long-Arm Courts, 1969 Wis.L.Rev. 9, 11. here, relies Fed.Rules Civ.Proc. 4(d)(7) (e). Compare view. 707. unnecessary

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