Court Opinion

ID: 9486246
Source: CourtListenerOpinion
Date Created: 2023-08-05 11:41:40.542435+00
Date Added: 2024-06-11T17:51:35.674237
License: Public Domain

WALLACE, Chief Judge,
dissenting:
The facts we must assess in this appeal, as alleged in Core-Vent’s complaint, demonstrate that Drs. Albrektsson, Lekholm, Sen-nerby, and Branemark (collectively, the Swedish doctors) engaged in tortious conduct purposefully directed at Core-Vent, a resident of the forum state, and intended to cause harm in the forum state. After weighing the relevant factors, I conclude that the Swedish doctors have not presented a compelling argument that the district court’s exercise of personal jurisdiction over them would be unreasonable. Therefore, I dissent.
In its first amended complaint, Core-Vent alleges that Drs. Albrektsson and Lekholm are paid consultants of Nobelpharma. Together they, co-authored an article published in the October 1989 edition of Dental Clinics of North America “that contained false and misleading comparisons of Core-Vent and Nobelpharma implants.” Dr. Sennerby is a Nobelpharma-financed dentist, who in 1990, with Dr. Malmquist, a United States citizen, co-authored an article in the International Journal of Oral and Maxillofacial Implants, which falsely represented the success rate of Core-Vent’s implants to be only 9.3%. In 1990, Drs. Albrektsson and Sennerby co-authored an article in the International Journal of Prothodontics, which misrepresented the relative success rates of Nobelpharma and Core-Vent implants, falsely stated that Core-Vent’s implants did not-meet the criteria for success, and falsely stated that Core-Vent’s claims to the contrary were “unprofessional.” Nobelpharma had the right to review these articles before they were submitted for publication.
Core-Vent does not allege that Dr. Brane-mark wrote any defamatory articles. Rather, it alleges he is a Nobelpharma director and that he, “by distributing funds otherwise not available from other sources, controlled the studies to exaggerate the success of [No-belpharma’s] implants and the alleged danger in purchasing from anyone else.” It is further alleged that Dr. Branemark used the Nobelpharma funds at his disposal to '“flood[ ] the profession with biased and misleading marketing publications which, while giving the appearance of scientific objectivity, are, in fact, biased articles written to promote the products of ... Nobelpharma, and denigrate, through false comparative advertising, the products of competitors.” Core-Vent further alleges that these publications “were circulated in this district to the damage of [Core-Vent].”
Dr. Nizick, the President and Chief Executive Officer of Core-Vent, has confirmed that the above allegations are “true and correct” to the best of his “knowledge and belief.” The Swedish doctors assert in their declarations and in their brief that they are independent scholars, but they do not directly controvert any of Core-Vent’s factual allegations, including the allegation that they hired *1492others to or were paid to write allegedly defamatory articles.
For purposes of this appeal, Core-Vent’s allegations must be accepted as true. Fields v. Sedgwick Associated Risks, 796 F.2d 299, 301 (9th Cir.1986) (Fields). The issue, then, is whether a federal district court may exercise jurisdiction over foreign defendants, who intentionally publish defamatory articles about a forum resident in the forum. Core-Vent bears the burden of establishing that jurisdiction over the Swedish doctors would be proper. Data Disc, Inc. v. Systems Technology Assocs., 557 F.2d 1280, 1285 (9th Cir.1977). However, because the district court relied only upon the parties’ written submissions, Core-Vent need only make a prima facie showing of jurisdiction. Id. We review the holding of the district court on this issue de novo. Fields, 796 F.2d at 301.
Judge O’Scannlain’s analysis leads him to conclude that jurisdiction is absent and would affirm the district court. Judge Fernandez writes separately, agreeing with me that there was purposeful availment, but voting that there is a lack of jurisdiction and, in effect, joining in the result of Judge O’Scann-lain’s opinion on reasonableness, stating his own reasons for his position. I take a third position, and write to demonstrate the failure of the Swedish doctors to meet their burden of proof to overcome Core-Vent’s prima facie showing of jurisdiction.
As Judge O’Scannlain states, we use' the following test to determine whether specific jurisdiction over a nonresident defendant is proper:
(1) the nonresident defendant must purposefully direct his activities or consummate some transaction with the forum or residents thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or relates to the defendant’s forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.
Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir.1987). Although Judge O’Scannlain has correctly stated the jurisdictional test, I disagree with his application. I therefore turn to my analysis of the three factors described in Lake.
I
The leading case dealing with purposeful direction is Colder v. Jones, 465 U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984) (Colder). There, the Supreme Court determined that California courts could exercise jurisdiction over an editor and a reporter who caused a defamatory article to be published in Florida and circulated in California because the tor-tious conduct was “expressly aimed” at the forum state. As we have previously recognized, Colder stands for the proposition that purposeful availment is satisfied even by a defendant “whose only ‘contact’ with the forum state is the ‘purposeful direction’ of a foreign act having effect in the forum state.” Haisten v. Grass Valley Medical Reimbursement Fund, 784 F.2d 1392, 1397 (9th Cir.1986) (Haisten). Nevertheless, Judge O’Scannlain reads Colder narrowly. His opinion seems to argue that but for the fact that “defendants knew that the. brunt of the harm would be suffered in California,” op. at 1486, jurisdiction would not have been found. In Colder, the fact that the author and editor knew the brunt of the harm from their article would be suffered in California was a factor that weighed in favor of purposeful direction, but it was not a prerequisite. See Colder, 465 U.S. at 788-89, 104 S.Ct. at 1486-87. To the contrary, the Court held that jurisdiction was proper because “petitioners [were] primary participants in an alleged wrongdoing intentionally directed at a California resident.” Id. at 790, 104 S.Ct. at 1487.
In addition, Judge O’Scannlain’s argument ignores one very important fact: the Supreme Court has already rejected the proposition that the brunt of the harm must be suffered in the forum. Keeton v. Hustler Magazine, 465 U.S. 770, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984) (Keeton) (decided the same day as Colder). In Keeton, the Court held that limited jurisdiction was proper even though it was “undoubtedly true that the bulk of the harm done to petitioner occurred outside [the forum].” Id. at 780, 104 S.Ct. at *14931481. In fact, Keeton expressly recognized that a plaintiff may sue in any forum with which the defendant has minimum contacts and seek recovery for damages suffered in other forums. Id. Reading Calder and Kee-ton together, it is clear that Judge O’Scann-lain’s new test, which requires that a defendant “caus[e] harm, the brunt of which is suffered — and which the defendant knows is likely to be suffered — in the forum state,” op. at 1486, is an erroneous statement of the law. No such requirement exists. Indeed, it is inconsistent with the teachings of the Supreme Court.
In an attempt to justify his interpretation of Calder, Judge O’Scannlain suggests that we have always read Calder narrowly. Op. at 1486. The opinion asserts that Calder does not mean that the “effects of libel are felt and jurisdiction exists wherever a corporate plaintiff resides.” Id., citing Casualty Assurance Risk Ins. Brokerage Co. v. Dillon, 976 F.2d 596, 601 (9th Cir.1992). Even if this were true, it is not relevant because in this case the defamatory articles were actually published in the forum. As Dillon itself recognizes, the effects of libel are felt and jurisdiction is proper in any forum in which the article is actually published. Id.; see also Keeton, 465 U.S. at 776-78, 104 S.Ct. at 1479-80; Sinatra v. National Enquirer, 854 F.2d 1191, 1195 (9th Cir.1988) (Sinatra).
Judge O’Scannlain also finds a relevant distinction in the fact that Core-Vent is a corporation and the petitioner in Calder was an individual. Op. at 1486. This exposes a ■fundamental misperception of Judge O’Scannlain’s analysis. His opinion focuses on the nature of Core-Vent, its contacts with the forum, and how it is affected by the harm. But the jurisdictional inquiry should focus on the Swedish doctors, their contacts with the forum, and their intent to cause harm. See Keeton, 465 U.S. at 780-81, 104 S.Ct. at 1481.
Judge O’Scannlain next asserts that “we [have] refused to apply the Calder effects test when the underlying action involved a contract dispute, not a tort.” Op. at 1486, citing McGlinchy v. Shell Chem. Co., 845 F.2d 802, 817 (9th Cir.1988). This dicta is irrelevant because the underlying action in this case is libel — a tort — the same underlying action found in Keeton and Calder. It is also an incorrect statement of historical fact. See Haisten, 784 F.2d at 1399 (applying Calder analysis to insurance contracts).
Finally, Judge O’Scannlain suggests that analogy to Calder does not support a finding that the articles were expressly directed at California because the events underlying the articles did not occur in California and the articles were not researched through California sources. Op. at 1486. This ignores the fact that in Calder, the Court did not rely on the research methods employed in writing the story. Calder, 465 U.S. at 787 n. 6, 104 S.Ct. at 1485. Jurisdiction was found because the libelous story was published within the forum to the detriment of a forum resident. Id. at 789-90, 104 S.Ct. at 1487. As in Calder, the Swedish doctors were “primary participants in an alleged wrongdoing intentionally directed at a California resident, and jurisdiction over them is proper on that basis.” Id. at 790, 104 S.Ct. at 1487.
Ironically, Judge O’Scannlain then disavows his analysis of Calder and ultimately “assumes that the purposeful availment prong has been satisfied.” Op. at 1487. I would go one step further based on Keeton and Calder and hold expressly that Core-Vent’s uncontroverted allegations are sufficient to establish a prima facie case that the Swedish doctors have purposefully directed their tortious conduct at the forum. On this issue, Judge Fernandez has joined my analysis. Thus, for purposes of this case, a majority of the panel agree that purposeful availment has been established.
II
The second part of the Lake test for jurisdiction requires that the claim arise out of or relate to the Swedish doctors’ forum-related activities. As to this issue, the Swedish doctors raise no defense and I conclude that this part of the test was met.
*1494m
I now turn my attention to the third part of the Lake test: reasonableness. Because Judge Fernandez and I agree that Core-Vent has met its burden of showing that the Swedish doctors purposefully directed their conduct at the forum, jurisdiction is presumed to be reasonable. Brainerd, v. Governors of the Univ. of Alberta, 873 F.2d 1257, 1260 (9th Cir.1989) (Brainerd); Haisten, 784 F.2d at 1397. The burden of proof is now on the doctors to “present a compelling case that the presence of some other considerations would render jurisdiction unreasonable.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477, 105 S.Ct. 2174, 2185, 85 L.Ed.2d 528 (1985) (Burger King); Brainerd, 873 F.2d at 1260; Haisten, 784 F.2d at 1397, 1400.
We have in the past, as Judge O’Scannlain does now, referred to seven questions that may be raised in determining whether jurisdiction is reasonable. However, Judge O’Scannlain’s analysis of several of these is erroneous.
The first pertains to the extent of the Swedish doctors’ contacts with the forum. Judge O’Scannlain concludes that the contacts are “attenuated.” But how does this help? By definition, foreign acts with forum effects will be “attenuated” to some extent because the acts which give rise to the effects occur outside the forum. The Swedish doctors argue only that Core-Vent has not proven that their acts were expressly aimed at California or that the brunt of the harm was suffered in California. These arguments are the same as those analyzed in part I and must fail for the same reasons.
On the other hand, Core-Vent has alleged that the Swedish doctors wrote the articles at the behest of and with the financial backing of Nobelpharma, with the purpose of causing Core-Vent harm. Core-Vent also alleges that the articles were circulated in California, causing it to lose business in California. In other words, Core-Vent has alleged that the doctors were “primary participants in an alleged wrongdoing intentionally directed at a California resident.” Calder, 465 U.S. at 790, 104 S.Ct. at 1487. Because these uncontro-verted allegations must be accepted as true for purposes of this appeal, Fields, 796 F.2d at 301, the resolution of this first inquiry weighs strongly in Core-Vent’s favor.
The second inquiry relates to the burden on the Swedish doctors of defending a lawsuit in California. Although I agree with Judge O’Seannlain that this factor weighs in the doctors’ favor, it does so lightly. The Swedish doctors argue that “the requisite travel, involving a distance of 5454 miles across nine time zones, is an onerous burden.” The convenience of modern transportation and telecommunications facilities, however, has eased this burden to the point that well-educated, well-financed professionals would not be unduly burdened by the travel requirements. See Sinatra, 854 F.2d at 1199.
Judge Fernandez appears to put his primary reason for concurring in the result of Judge O’Scannlain’s reasonableness analysis on this single factor. But we are required to balance all factors. Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 840 (9th Cir.1986), citing Olsen by Sheldon v. Government of Mexico, 729 F.2d 641, 649 (9th Cir.) (Olsen) (“To determine reasonableness, we consider the relative significance of each factor and balance them all.”), cert. denied, 469 U.S. 917, 105 S.Ct. 295, 83 L.Ed.2d 230 (1984). In doing so, this single factor cannot, in my judgment, rule the result.
The Swedish doctors’ next argument is that defending in a foreign legal system would be extremely burdensome. Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 114, 107 S.Ct. 1026, 1033, 94 L.Ed.2d 92 (1987). This oft-repeated argument is true, generally; but the jurisdictional inquiry is made on a case-by-case basis. The Swedish doctors do not provide any evidence that defending in a foreign legal system would be burdensome to them. They do not suggest that it would be difficult to transport evidence, witnesses, or attorneys from Sweden to California. See Olsen, 729 F.2d at 649. In fact, Core-Vent has alleged that Nobelp-*1495harma’s attorneys are conducting the Swedish doctors’ defense. This would decrease any burden on the Swedish doctors significantly. I do not suggest that defending in California would place no burden at all on the Swedish doctors. ' Certainly they would be inconvenienced. But “‘[u]nless such inconvenience is so great as to constitute a deprivation of due process, it will not overcome clear justifications for the exercise of jurisdiction.’ ” Roth v. Garcia Marquez, 942 F.2d 617, 628 (9th Cir.1991), quoting Hirsch v. Blue Cross, Blue Shield, 800 F.2d 1474, 1481 (9th Cir.1986).
The third question relates to conflict with the sovereignty of Sweden. Ordinarily, as Judge O’Scannlain suggests, this factor would weigh heavily in the Swedish doctors’ favor. But the Swedish doctors have not presented arguments that implicate a significant interference with Sweden’s sovereignty in this case. They argue that this case would interfere with the “right of Swedish courts to resolve disputes involving Swedish citizens.” But this case also involves an American corporation, and the application of California law. The Swedish doctors argue that they have direct professional ties with governmental institutions. But these ties are not alleged to be implicated in this case. Finally, the doctors argue that Core-Vent has not demonstrated that jurisdiction would not impinge upon Sweden’s sovereignty. This is true, but it misperceives the location of the burden of proof. The burden is on the Swedish doctors to make a compelling case that jurisdiction would be unreasonable, Burger King, 471 U.S. at 477, 106 S.Ct. at 2184-85, not the other way around.
The fourth inquiry relates to the forum state’s interest in adjudicating the suit. “False statements of fact harm both the subject of the falsehood and the readers of the statement.” Keeton, 465 U.S. at 776, 104 S.Ct. at 1479. California has a strong interest in providing a forum in which its residents can seek redress from those who knowingly cause them injury there. See Calder, 465 U.S. at 790, 104 S.Ct. at 1487. In addition, California has an interest in “employ[ing] its libel laws to discourage the deception of its citizens.” Keeton, 465 U.S. at 776, 104 S.Ct. at 1479. These interests require that this factor be weighed heavily in Core-Vent’s favor.
I agree with Judge O’Scannlain’s weighing of the final three factors, but I also conclude that they are not important or determinative.
IV
In this case, the Swedish doctors’ purposeful direction of tortious activity into California and the state’s strong concomitant interest in providing a forum in which its residents may seek redress of their grievances must be weighed against the burden on the Swedish doctors in having to litigate in a foreign legal system and any possible interference with Sweden’s sovereignty. I conclude that the Swedish doctors have failed to meet their burden requiring them to present a compelling case that jurisdiction would be unreasonable. The Swedish doctors purposefully directed their tortious conduct into the forum for the purpose of harming Core-Vent. They should not now be heard to complain that it would be unfair to require them to defend themselves in a forum in which they intended their tortious conduct to have its effect. See Brainerd, 873 F.2d at 1260; Haisten, 784 F.2d at 1402. Traditional notions of fair play and substantial justice require no less.
I respectfully dissent.