Richard Morris v. Francois Harley
16-16064
| 9th Cir. | Dec 6, 2017Background
- Richard and Claudine Morris signed a 99-year lease (Aug. 29, 2012) for lot “Mango 12” in Cambium, a subdivision wholly in the Dominican Republic.
- On May 31, 2013, while Francois Harley was in Las Vegas, the parties amended the lease to substitute lot “Cana 17” for Mango 12; other lease terms remained unchanged.
- Morrises sued in 2015 alleging violations of the Interstate Land Sales Full Disclosure Act (ILSA) and related state tort and contract claims against Harley and his company Cambium E.I.R.L.
- Defendants moved to dismiss for lack of personal jurisdiction; the district court granted dismissal for lack of jurisdiction in Nevada and under the federal long-arm rule for the United States as a whole.
- Morrises appealed, arguing waiver of jurisdictional defenses, that defendants are subject to jurisdiction in Nevada and under the federal long-arm statute, and that ILSA automatically confers jurisdiction.
- The Ninth Circuit affirmed, holding defendants were not subject to general or specific jurisdiction in Nevada or the United States and that ILSA does not eliminate constitutional due-process limits on jurisdiction.
Issues
| Issue | Morris's Argument | Harley/Cambium's Argument | Held |
|---|---|---|---|
| Waiver of personal-jurisdiction defense | Defendants waived by not raising earlier | Defs raised jurisdiction in first responsive pleading | No waiver; Rule 12(h) allows defense (Defendants did not waive) |
| General jurisdiction in Nevada | Harley’s Las Vegas promotion made them essentially at home | Defs not at home in Nevada; Cambium based in DR | No general jurisdiction in Nevada |
| Specific jurisdiction in Nevada | Amendment executed in Las Vegas links claim to Nevada contacts | Lease formed in DR; amendment only changed lot; claim not caused by Nevada acts | No specific jurisdiction in Nevada (contacts not but-for cause; reasonableness factors weigh against) |
| Jurisdiction under federal long-arm (4(k)(2)) | Nationwide contacts (US promotion, brochures) justify adjudication in US | Discrete US acts insufficient; Cambium centered in DR; forum nonconveniens factors favor DR arbitration | No general or specific jurisdiction under 4(k)(2); ILSA does not automatically permit jurisdiction |
Key Cases Cited
- Walden v. Fiore, 134 S. Ct. 1115 (2014) (personal-jurisdiction due-process standard requires defendant’s purposeful contacts with the forum)
- CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066 (9th Cir. 2011) (limits on general jurisdiction; discrete acts insufficient to render a defendant "essentially at home")
- Menken v. Emm, 503 F.3d 1050 (9th Cir. 2007) (specific-jurisdiction analysis requires a but-for causal link between forum contacts and the claim)
- Pebble Beach Co. v. Caddy, 453 F.3d 1151 (9th Cir. 2006) (application of Federal Rule 4(k)(2) and due-process analysis for nationwide jurisdiction)
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (1945) (foundational due-process limits on state exercise of personal jurisdiction)