Court Opinion

ID: 9863573
Source: CourtListenerOpinion
Date Created: 2023-09-25 05:46:22.054473+00
Date Added: 2024-06-11T11:49:31.955068
License: Public Domain

*7ZLAKET, Chief Justice,
dissenting.
¶ 20 I believe the court of appeals’ opinion is correct and would not disturb it.
I.
¶ 21 The majority’s analysis too narrowly relies on causal nexus as the linchpin of specific jurisdiction. Such a strict approach invites absurd and unjust results. Consider this hypothetical: Suppose another Arizona resident was intentionally or negligently overserved with alcohol by the defendant’s casino on the day of the accident. After crossing the border to go home, this person was also involved in a collision and sustained serious injuries. Unlike the plaintiffs, however, he claims to have been drawn to the casino by an advertisement in the Cerbat Gem,. Under the majority’s approach as I understand it, our hypothetical motorist could likely sue Lakeview in Arizona, even though the plaintiffs cannot. This would be so despite the fact that Lakeview’s activities were exactly the same in each case.1 Due process, in my judgment, cannot rest on such a weak distinction.2
¶ 22 The focus of any due process analysis must be on the defendant’s conduct. The majority, turns this principle on its head by concentrating instead on the reasons for the plaintiffs’ behavior. But it is fairness to the defendant that lies at the heart of the inquiry. See Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 427,104 S.Ct. 1868, 1879, 80 L.Ed.2d 404 (1984) (Brennan, J., dissenting) (“At least since International Shoe ... the principal focus ... has been on fairness and reasonableness to the defendant.”) (citation omitted). I submit that there would be no difference in fairness if we were to require the casino to appear and defend in Arizona against either our hypothetical citizen or these very real plaintiffs.
¶ 23 “When a controversy is related to or ‘arises out of a defendant’s contacts with the forum, the [Supreme] Court has said that a ‘relationship among the defendant, the forum, and the litigation’ is the essential foundation of in personam jurisdiction.” Helicopteros, 466 U.S. at 414, 104 S.Ct. at 1872 (quoting Shaffer v. Heitner, 433 U.S. 186, 204, 97 S.Ct. 2569, 2579, 53 L.Ed.2d 683 (1977)). The test to be applied is whether the claim “is related to or ‘arises out of” contacts with this state. Id. (emphasis added). The Supreme Court’s use of the disjunctive “or” between “arises out of’ and “related to” suggests that these two phrases refer to “substantial[lly] different] ... standards for asserting specific jurisdiction.” Id. at 425, 104 S.Ct. at 1878 (Brennan, J., dissenting). The majority in Helicópteros declined to pursue this distinction because the case was framed only in terms of “continuous and systematic” contacts required for a finding of general jurisdiction.3 Id. at 415-16,104 S.Ct. at 1872-73. Nevertheless, other courts have recognized the difference. See, e.g., Ticketmaster-New York, Inc. v. Alioto, 26 F.3d 201, 206 (1st Cir.1994) (“For our part, we think it significant that the constitutional catchphrase is disjunctive in nature____”); Third Nat. Bank in Nashville v. WEDGE Group Inc., 882 F.2d 1087, 1091 (6th Cir. 1989) (stating that specific jurisdiction “does not require that the cause of action formally ‘arise from’ defendant’s contacts with the forum; rather, this criterion requires only ‘that the cause of action, of whatever type, have a substantial connection with the defendant’s in-state activities.’ ”); Thomason v. Chemical Bank, 234 Conn. 281, 661 A.2d 595, 600 n. 4 (1995) (opining that the “arising out of’ language refers to a causal relationship, whereas “relates to” does not).
*8¶ 24 In Lawson v. Darrington, 416 N.W.2d 841 (Minn.Ct.App.1987), the court held that specific jurisdiction could be exercised over an Iowa liquor vendor despite the fact that the defendant’s Minnesota advertisements did not cause the plaintiffs to visit its bar. The facts are strikingly similar to those here. Darrington drove himself and Lawson from their home in Minnesota to a bar in Iowa, twelve miles south of the state line. While there, the bar served drinks to Darrington, who was a minor at the time. After the men crossed the border on their way home, the car crashed and both of them were injured. Lawson sued the bar in a Minnesota state court.
¶ 25 The defendant argued that the court lacked personal jurisdiction without a judicial finding that its advertising activities in Minnesota “directly caused” Lawson and Darrington to travel to Iowa. Id. at 844. The court responded:
We disagree with this narrow interpretation. Due process is satisfied by a showing that the Minnesota activities of the nonresident liquor vendor relate to the operation of the bar and solicitation of Minnesota residents____
... [The bar] actively solicited customers in Minnesota to come to Iowa to drink.... [The bar] could reasonably anticipate being hailed into Minnesota courts for injuries incurred by Minnesota residents on a return trip from [its] Iowa establishment.
Id. at 844-45.4
¶ 26 In Shoppers Food Warehouse v. Moreno, 746 A.2d 320 (D.C.Cir.2000)(en banc), a Maryland-based grocery chain regularly advertised in District of Columbia newspapers. Ms. Moreno was a D.C. resident who visited one of Shoppers’ stores and was injured. She had never seen any of the ads. Nevertheless, the court held that District of Columbia courts could exercise specific jurisdiction over the defendant because the plaintiffs claim was related to the company’s activities in the District. Because Shoppers regularly solicited D.C. residents, the court concluded that it “could be sued in the District on a claim similar to that filed by Ms. Moreno.” Id. at 336. The plaintiff was among a class of persons targeted by the ads — i.e., District of Columbia customers. Thus, the defendant could reasonably expect to be haled into court in that jurisdiction.
¶27 Today’s majority fears that allowing an Arizona action “in the absence of any nexus” will obliterate the difference between general and specific jurisdiction. Supra at ¶ 13. But that implies the existence of two completely separate and distinct, isolated and dissimilar, classes of jurisdiction, a concept with which I respectfully disagree. In my view, we should analyze the present issue as one involving varying degrees of relationship. General and specific jurisdiction he on the same broad spectrum, ranging from specific contacts which directly cause a claim, to general, systematic, and continuous contacts that may be totally unrelated to the claim.. Causes of action that “relate to,” but do not necessarily “arise out of’ a defendant’s contacts with the forum fall along this spectrum. They do not automatically fail for lack of a specific causal connection, as the majority’s view would dictate, but instead must be examined for other factors that enter into the due process equation.
¶28 Due process requires “fair warning” to a nonresident defendant that a particular activity will subject it to suit in a foreign jurisdiction. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472, 105 S.Ct. 2174, 2182, 85 L.Ed.2d 528 (1985). Lakeview targeted Arizona residents by advertising in Arizona newspapers. The casino ran full-page ads in every issue of the Cerbat Gem, trumpeting “WE LOVE OUR ARIZONA NEIGHBORS.” In addition, the defendant solicited tour bus companies in this state to bring more Arizonans to its hotel and casino. *9As an incentive, it paid commissions to these operators based on the amount of time their buses spent at the casino.
¶ 29 As a result of these contacts, Defendant’s business has made significant money from Arizona residents. At the time of the accident, nearly 25% of the Gold Strike Inn’s guests, and about 17% of its preferred customers, were from this state. As the Supreme Court said in Burger King, once a defendant purposely derives benefit from his contacts with another state, it cannot then use the Due Process Clause as a “territorial shield” to avoid the obligations that flow from those contacts. 471 U.S. at 473-74,105 S.Ct. at 2183; see also Nowak v. Tak How Invs., Ltd., 94 F.3d 708, 715 (1st Cir.1996) (upholding jurisdiction over a foreign defendant that “directly targets residents in an ongoing effort to further a business relationship, and achieves its purpose”).
¶ 30 Lakeview advertised in Arizona with the clear intent of enticing people to cross the state line and frequent the casino. Like all advertisers, it hoped these efforts would increase public awareness. That, in turn, would result in new customers who had either seen the ads themselves, or heard about the casino from others who may have observed or been told about them. The majority’s analysis simply fails to consider such self-evident, “word-of-mouth” effects of prolonged advertising in a targeted area.
¶31 It is clear that the plaintiffs were within the class of persons Lakeview intended to draw, even though they had not personally seen the ads. They went to the casino to gamble, as did many other Arizonans. The injuries forming the basis of this cause of action occurred in Arizona and, we assume for purposes of our review, resulted from the defendant’s overservice of alcohol in Nevada.5
¶ 32 Lakeview cannot seriously claim ignorance that its activities might have subjected it to suit in Arizona. Moreover, as noted by the court of appeals, see Williams v. Lakeview Co., 195 Ariz. 468, 474, 990 P.2d 669, 675 (Ariz.Ct.App.1999), the defendant has not asserted that the exercise of jurisdiction over it would be unreasonably burdensome. Thus, I see no constitutional impediment to Arizona jurisdiction.
II.
¶ 33 The majority all but ignores section 37 of the Restatement (Second) of Conflict of Laws, which reads as follows:
§ 37. CAUSING EFFECTS IN STATE BY ACT DONE ELSEWHERE
A state has power to exercise judicial jurisdiction over an individual who causes effects in the state by an act done elsewhere with respect to any claim arising from these effects unless the nature of the effects and of the individual’s relationship to the state make the exercise of such jurisdiction unreasonable.
(emphasis added). We have considered this section in past discussions of personal jurisdiction. See Chavez v. State of Indiana, 122 Ariz. 560, 562, 596 P.2d 698, 700 (1979)(quot-ing at length § 37 and its comment). The court of appeals has also paid it some attention. See Powder Horn Nursery, Inc. v. Soil & Plant Laboratory, Inc., 20 Ariz.App. 517, 523, 514 P.2d 270, 276 (1973)(referring to Comment a of § 37 in support of the proposition that foreseeability would have prime importance to a minimum contacts analysis).6 *10Courts in other states have relied on it as well. See, e.g., Braband v. Beech Aircraft, 51 Ill.App.3d 296, 9 Ill.Dec. 684, 367 N.E.2d 118, 123 (1977)(citing § 37 in support of its exercise of jurisdiction over an airplane manufacturer. that had no contacts with Illinois other than post-sale use of the plane in the state); Wendt v. County of Osceola, Iowa, 289 N.W.2d 67, 69-70 (Minn.l979)(considering § 37 in allowing a Minnesota suit against an Iowa county for failure to post adequate road signs).
¶ 34 Assuming the veracity of the complaint, as we must, there can be no question that Lakeview caused “effects” to occur in Arizona by its conduct in Nevada. Therefore, the only remaining issue under the Restatement is whether the nature of these effects and the relationship between Lake-view and Arizona are such that our exercise of jurisdiction over the defendant would be unreasonable.
¶ 35 Comment c to § 37 sets forth criteria for making such a determination. They include “the extent of the relationship of the state to the defendant and to the plaintiff, the nature and quality of the effects resulting from the act, the degree of inconvenience ... to the defendant ... and, conversely, the degree of inconvenience that the plaintiff would suffer.” In addition, comment e discusses at length the foreseeability of the injury. Conspicuously absent is a strict requirement of causal nexus between the defendant’s activities within the state and the injury. Rather, the inquiry focuses almost exclusively on reasonableness in light of the factors listed above.
¶ 36 This multi-faceted approach is perfectly in keeping with the long line of Supreme Court decisions forming the backbone of specific jurisdiction law. “[Cjourts in appropriate case[s] may evaluate the burden on the defendant, the forum State’s interest in adjudicating the dispute, the plaintiffs interest in obtaining convenient and effective relief, the interstate judicial system’s interest in obtaining the most efficient resolution of controversies.” Burger King, 471 U.S. at 477, 105 S.Ct. at 2184 (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 564, 62 L.Ed.2d 490 (1980)) (internal quotation marks omitted).
¶ 37 In my judgment, the majority cuts too fine a line when it limits today’s analysis to a lack of direct causation. I see no reason why Lakeview should not be made to answer in Arizona for the effects of its Nevada conduct occurring here. The defendant has clearly established a relationship with the State of Arizona through its advertising, solicitation of tour buses, employment of citizens, and garnering of business.7 It has made no claim that litigation in Arizona will be unreasonably inconvenient. The plaintiffs are citizens of this state, giving Arizona a legitimate interest in protecting their well being and access to justice.8 The state also has a strong interest in making sure that its highways are free from drunk drivers. Finally, this occurrence was foreseeable, considering Lake-view’s service of alcohol, proximity to the border, and success in attracting Arizona residents to its casino. The combination of these factors meets the reasonableness requirement of § 37 of the Restatement.
¶38 I would affirm the judgment of the court of appeals.
CONCURRING: STANLEY G. FELDMAN, Justice.

. The example becomes even more compelling if we make the hypothetical plaintiff a passenger in the same car with Michelyn and Kelly Williams. Can it be that he can sue in Arizona, but they cannot?

. The causal nexus requirement, as explained by the majority, is so insubstantial that it easily lends itself to fabrication. After today's decision, I rather suspect that any similarly situated but unscrupulous plaintiff would claim to have seen at least one of the out-of-state defendant’s advertisements here in Arizona.

. Thus, it was unnecessary for the Court to determine "whether the terms ‘arising out of and 'related to' described different connections between a cause of action and a defendant's contacts with a forum.” Helicopteros, 466 U.S. at 415 n. 10, 104 S.Ct. at 1872 n. 10.

. Other courts, too, have found specific jurisdiction on similar facts. See, e.g., BLC Ins. Co. v. Westin, Inc., 359 N.W.2d 752 (Minn.Ct.App. 1985); Wimmer v. Koenigseder, 128 Ill.App.3d 157, 83 Ill.Dec. 368, 470 N.E.2d 326 (1984), rev’d on other grounds, 108 Ill.2d 435, 92 Ill.Dec. 233, 484 N.E.2d 1088 (1985); Young v. Gilbert, 121 N.J.Super. 78, 296 A.2d 87 (Law Div.1972). For an overview of this subject, see James B. Lewis, Sale of Alcohol to Interstate Travelers: Personal Jurisdiction and Choice of Law Analyses, 39 Drake L.Rev. 349 (1990).

. Because Lakeview moved to dismiss for lack of personal jurisdiction, we must treat the factual assertions in the plaintiffs’ complaint as being accurate. See G.T. Helicopters, Inc. v. Helicopters, Ltd., 135 Ariz. 380, 382, 661 P.2d 230, 232 (Ariz.Ct.App.1983) ("In reviewing a motion to dismiss, this court accepts all material facts as alleged by the non-movant as true.”).

. The majority questions the applicability of Chavez and Powder Horn, and their reliance on § 37, because they pre-date the Supreme Court's decisions in World-Wide Volkswagen (1980), Helicopteros Nacionales de Colombia (1984), and Burger King (1985). Supra at ¶ 16. It is significant, however, that three years after Burger King, the American Law Institute undertook a revision of the Restatement and did not make any substantive changes to § 37. Had the ALI believed that recent Supreme Court decisions called into question the validity of § 37, it presumably would have taken steps to address the matter. Instead, it simply removed a caveat regarding the First and Fourteenth Amendments, and cited to World-Wide Volkswagen in support of its acknowledgment that foreseeability alone is not enough to confer jurisdiction. See Reporter’s Note to § 37 (Supp.1989). Today, fifteen years *10after Burger King, § 37 still refers to the exercise of "judicial jurisdiction.” Neither its text, nor the comments supporting it, have been limited to "choice of law principles.” See supra at ¶ 16.

. These facts clearly distinguish the present case from Batton v. Tennessee Farmers Mut. Ins. Co., 153 Ariz. 268, 736 P.2d 2 (1987), cited by the majority. In Batton, the defendant did not purposefully do anything to establish contact with Arizona. See id. at 274, 736 P.2d at 8. Interestingly, two members of this court later called for a reexamination of the conclusions reached in Batton. See Hoskinson v. State of California, 168 Ariz. 177, 178, 812 P.2d 995, 996 (1991).

. It is suggested in the record that Nevada law, unlike Arizona law, would afford the plaintiffs little or no relief for this type of claim. It also is unclear whether Nevada courts would apply Arizona law, despite the fact that the accident occurred here. See, e.g., Motenko v. MGM Dist., Inc., 112 Nev. 1038, 921 P.2d 933 (1996).