This week, the Ninth Circuit clarifies personal jurisdiction doctrine in the context of a defamation suit between a nonresident plaintiff and out-of-state defendants.
The Court vacates the district court's dismissal for lack of personal jurisdiction and holds that a forum state may exercise jurisdiction over non-resident defendants even if the defendants never set foot in the state.
Panel: Judges Berzon, Bea, and Nguyen, with Judge Berzon writing the opinion.
Key Highlight: "Where a defendant directs communications that are defamatory toward a forum state and seeks to interfere with a forum state contract, the defendant has purposefully directed conduct at the forum state, and the defendant knows or should know that such conduct is likely to cause harm in the forum state."
Background: Plaintiff Dean Burri is a Florida attorney whose law firm specializes in employment issues related to the Catholic Church. In 2015, the Phoenix Eparchy hired Burri to investigate its ERISA health care plan. Burri uncovered myriad issues with the Plan and eventually filed suit on behalf of the Phoenix Eparchy. In response, Plan administrators began to defame Burri in communications to the Phoenix Eparchy. Ultimately, the Phoenix Eparchy dismissed its ERISA action, following the principle that church officials cannot sue each other without papal authorization. The Phoenix Eparchy refused to pay Burri for his legal services and later filed a malpractice suit against him.
In July 2020, Burri filed suit in state court against the ERISA Plan administrators—Skurla, Burnett, and Lach, as well as their respective dioceses. He alleged four claims: two for tortious interference, unjust enrichment, and defamation. The Defendants removed the case to the District of Arizona and filed motions to dismiss for lack of personal jurisdiction. The district court denied Burri's request for jurisdictional discovery and granted the motions to dismiss. Burri appealed.
Result: The Ninth Circuit reversed. The panel began with a basic overview of personal jurisdiction. In short, due process requires that non-resident defendants have sufficient "minimum contacts" with the forum state. For tort cases, a defendant has minimum contacts if the defendant (1) purposefully directed activities toward the forum state; (2) the plaintiff's claim arises out of those activities; and (3) an exercise of jurisdiction would be reasonable. As the panel explained, a defendant can purposefully direct conduct at the forum state "even if the defendant never set foot in the forum state, if the defendant's contacts with the forum state are out-of-state acts that had an effect in the forum."
The Ninth Circuit then assessed whether each defendant had purposefully directed activities toward the forum state. The court first held that "Skurla directed communications toward Arizona that were defamatory and were designed to interfere with an Arizona lawsuit and an Arizona contract." Skurla argued that his activities were not targeted at the forum, but the panel disagreed; rather, the court determined that that Skurla's communications "were sent to Arizona, circulated within Arizona, and had an Arizona 'focus[.]'" The court then reasoned that similar analysis applied to the other defendants. Accordingly, the Ninth Circuit vacated the district court's dismissal of Burri's claims and the denial of Burri's motion for jurisdictional discovery, and remanded for the lower court to re-assess Burri's complaint using the proper framework for personal jurisdiction.
Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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