General Electric Co. v. Bucyrus-Erie Co.General Electric Co. v. Bucyrus-Erie Co.
MEMORANDUM DECISION
Plaintiffs are corporations organized under the laws of the United Kingdom and are minority shareholders of defendant Ruston-Bucyrus, likewise a British corporation. They bring this action both individually and derivatively for alleged wrongs which they contend violate both the antitrust laws of the United States and also certain fiduciary duties owed them by defendant BucyrusErie, the majority shareholder in Ruston-Bucyrus. Bucyrus-Erie is a United States corporation. Before us is a motion by Ruston-Bucyrus (“Ruston”) to dismiss for lack of personal jurisdiction, improper venue, and improper service.
In Personam Jurisdiction Over Ruston
The personal jurisdiction issues raised by defendant Ruston reduce to a two part question of statutory interpretation: does the general venue statute found at
Section 12 states in its entirety:
Any suit, action, or proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found.
The long sentence of which section 12 consists has two clauses, separated by a semicolon. One relates to venue, the other to service and, as noted, personal jurisdiction. Ruston argues that personal jurisdiction via the extraterritorial service clause of section 12 is available only when the special venue requirements found in the first clause of section 12 are met. The plaintiffs assert in essence that the extraterritorial service provision of section 12 is independent of section 12’s venue clause and is always available in antitrust cases, that personal jurisdiction in such cases requires only that the parameters of the due process clause not be exceeded, and that venue may be satisfied by reference to either section 12 of the Clayton Act, or 28
*
We find that the availability of Section 12 service and personal jurisdiction do not depend upon the venue requirements of section 12 being met and that satisfaction of venue under
Although the Supreme Court has not spoken directly on the issue of whether
The second factor relevant in finding exclusivity in
Fourco
was evidence of an original congressional intent behind the enactment of the special venue provision that venue in patent infringement cases be restrictive. At the time the
Fourco
venue provision was passed a more liberal interpretation of venue law in patent cases prevailed and the new law was enacted specifically to limit this interpretation.
Id.
at 207,
*1040
As was true in
Pure Oil,
these exclusivity factors are not implicated here. Not only was there no concurrent action taken on section 12 when
Nor is exclusivity bolstered by the second factor identified in
Pure Oil,
an original congressional desire to restrict venue by passing the special venue statute. As was true with the special venue provision in
Pure Oil,
section 12 of the Clayton Act was passed not to restrict venue, but rather to expand it. Its “plain remedial purpose . . . was ... to enlarge the jurisdiction given by section 7 of the Sherman Act over corporations.”
United States v. Scophony Corp.,
In short, as was the case in
Pure Oil,
“there is nothing to show a congressional purpose negativing the more natural reading of the two venue sections together.”
Pure Oil v. Suarez,
Strengthening this conclusion, and most persuasive of all, is the more recent Supreme Court decision in
Brunette Machine Works, Ltd. v. Kockum Industries, Inc.,
For the foregoing reasons, we read
*1041
Establishing that the plaintiffs may rely on
In arguing for this construction of section 12, Ruston places much reliance on
Goldlawr, Inc. v. Heiman,
Significantly, however, the
Goldlawr
court did not discuss the applicability of
As a consequence, we do not find conclusive the
Goldlawr
language suggesting that there must be reliance on section 12 venue before section 12 extraterritorial service and personal jurisdiction may be deemed available.
6
This does not mean,
*1042
however, that we may accept plaintiffs’ construction. Plaintiffs argue that the words “in such cases” introducing the service of process clause in section 12 refer not to cases in which section 12 venue has been satisfied but rather to the words, “Any suit, action, or proceeding under the antitrust laws against a corporation ...,” which begin section 12. At least one other court has agreed with this construction,
Scriptomatic, Inc. v. Agfa-Gevaert, Inc.,
[1973]
This resolution is not free from doubt, but it would simply be anomalous if, as
Pure Oil
and the preponderance of subsequent lower court decisions dictate,
8
Also persuasive, as the court found in
Scriptomatic, Inc. v. Agfa-Gevaert, Inc.,
[1973]
The problem is that if
The decision in
Leasco
is significant in this regard. In
Leasco
the court construed the venue and service section of the Securities Exchange Act of 1934,
Finally,
Leasco
is supportive of our view in that it construes a statute nearly identical to section 12 and does not even hint that the process clause is contingent upon the venue clause being met. Indeed, the
Leasco
court suggests that the service clause is wholly independent of the venue clause by stating, “The second sentence and the first portion of the third deal with venue; the last portion of the third speaks expressly
only
to service of process.”
Leasco makes clear that when Congress grants to the federal courts the type of maximal in personam jurisdiction involved here, the forum with which the defendant must have the minimum contacts required by due process is the United States, not, as Rusten urges, the district, or for that matter the state. See Leasco at 1341. 11 In their opposition memorandum, plaintiffs assert that Rusten fulfills this due process requirement because it is both doing business in the United States, and because it engaged in an act, restraint of competition, which had an effect here. Defendants, apparently in the hope this court would hold venue under section 12 necessary to the action, have made no attempt to rebut this assertion. Further, on the basis *1044 of the uncontroverted facts there seems to be little difficulty in finding the requisite contacts. Plaintiffs establish, at least prima facie, that:
Ruston has regularly exported machines which it manufactures, spare parts for those machines, and parts for BucyrusErie machinery to the United States over the last several years.
The value of these exports is well into the millions of dollars.
Ruston executes contracts within the United States and has seen fit to adopt a United States corporate seal for this purpose.
Ruston holds patent rights under the laws of the United States and Great Britain and has licensed United States corporations to use both types of patent rights. Ruston regularly buys electrical equipment from Bucyrus-Erie and other United States corporations, and buys diesel engines from American manufacturers “through Bucyrus-Erie’s purchasing department” to get better prices and avoid having to send its own purchasing agents from England.
These contacts would seem to unmistakably evince a desire by Ruston to avail itself of the “privileges and benefits” of United States law such that “it has clear notice that it is subject to suit there.”
World-Wide Volkswagen Corp. v. Woodson,
Accordingly, we deny the motion to dismiss for lack of personal jurisdiction, venue, and improper service.
SO ORDERED.
Notes
. It should be noted that the
Fourco
and Pure
Oil
decisions confronted a slightly different problem than is presented here. In both of those cases the Court considered whether the general venue provision “supplemented” the specific provision so as to actually modify the latter’s meaning. Here, we are concerned not with whether the general provision changes the meaning of the specific, but whether the general provision provides a means of satisfying venue in addition to that allowed by the specific provision. We think it clear, however, that if the criteria outlined in
Fourco
and Pure
Oil
for finding that one provision modifies the other are met, then, a
fortiori,
we can conclude that
. In
Scophony
the Court gave a liberal reading to section 12 venue in a case which, like this one, involved an alien corporation. It might reasonably be inquired, then, why the Court needed to consider how broad section 12 venue was when
. See,
e.g., Ballard v. Blue Shield of Southern West Virginia, Inc.,
. See cases cited in n. 6, infra.
.
. The court is unpersuaded for similar reasons by the “legion” of other cases which the defendant argues support its proposed statutory construction. While these cases do, like
Goldlawr,
suggest that section 12 venue is a predicate to the availability of section 12 jurisdiction, a thorough look reveals that most involved domestic corporations, and so, as with
Goldlawr,
had little incentive to consider the applicability of the general venue statutes.
E. g., Academy of Ambulatory Foot Surgery v. American Podiatry Ass’n.,
. The word “such” means “the aforementioned,” Webster’s Third International Dictionary (unabr. ed.1963). Thus, when “such” precedes a noun it is assumed to refer to a particular antecedent noun and any dependent adjecfive or adjectival clauses modifying that noun, but not to any other part of the preceding clause or sentence. Applying this rule to section 12, “in such cases” would refer to “any suit, action, or proceeding under the antitrust laws against a corporation,” and not to anything else in section 12’s first clause.
This construction may also agree best with the language in
Leasco Data Processing Equipment Corp. v. Maxwell,
. See n. 3, supra.
.
Chrysler Corp. v. Fedders Corp.,
. That section provides in relevant part:
Any suit or action to enforce any liability or duty created by this chapter or rules and regulations thereunder, or to enjoin any violation of such chapter or rules and regulations, may be brought in any such district or in the district wherein the defendant is found or is an inhabitant or transacts business, and process in such cases may be served in any other district of which the defendant is an inhabitant or wherever the defendant may be found.
. The
Leasco
court determined whether due process was satisfied by analyzing defendants’ contacts with the United States.
See also Texas Trading v. Federal Republic of Nigeria,