Quail Cruises Ship Management Ltd. v. Agencia De Viagens CVC Tur Limitada
645 F.3d 1307
11th Cir.2011Background
- Quail alleges a conspiracy to induce it to purchase Templeton stock by fraudulent misrepresentations about the Love Boat vessel.
- Quail asserts securities fraud under §10(b) and Rule 10b-5, maritime torts, and related common-law claims.
- The district court dismissed for lack of subject-matter jurisdiction after Morrison held §10(b) and Rule 10b-5 are not extraterritorial.
- Quail’s closing of Templeton stock occurred in the United States, allegedly making the transaction domestic under Morrison.
- The district court found no federal question jurisdiction but declined supplemental jurisdiction over related maritime and common-law claims.
- The Eleventh Circuit vacates and remands, holding the district court erred in dismissing for lack of jurisdiction and retains supplemental jurisdiction over non-securities claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §10(b) applies domestically under Morrison | Quail argues the closing occurred in the United States. | Defendants contend Morrison forecloses extraterritorial application. | District court erred; transaction domestically occurred; jurisdiction exists. |
| Whether supplemental jurisdiction covers maritime and related claims | Maritime and common-law claims are part of the same case or controversy. | These claims fall outside federal question but within supplemental jurisdiction. | Yes; §1367(a) permits supplemental jurisdiction over these claims. |
| Whether district court should address personal jurisdiction/venue on remand | Mootness objections were premised on jurisdictional error. | Reservations on personal jurisdiction/venue can be reconsidered separately. | Remanded with vacatur of moot denials; those issues may be revisited if necessary. |
Key Cases Cited
- Morrison v. Nat. Australia Bank Ltd., 130 S. Ct. 2869 (Supreme Court 2010) (extraterritoriality of §10(b); transactional domestic focus)
- Murphy v. Fla. Keys Elec. Co-op. Ass’n, Inc., 329 F.3d 1311 (11th Cir. 2003) (maritime-tort claims may invoke supplemental jurisdiction)
- Fin. Sec. Assurance, Inc. v. Stephens, Inc., 500 F.3d 1276 (11th Cir. 2007) (consideration of documents attached to motion to dismiss when integral to claims)
- Sinaltrainal v. Coca-Cola Co., 578 F.3d 1252 (11th Cir. 2009) (standard for reviewing dismissal for lack of subject-matter jurisdiction)