Dee-K Enterprises, Inc.
v.
Heveafil Sdn. Bhd.

982 F.Supp. 1138 (E.D. Va. 1997)

What's Going On?

Motion by Defendants (foreign corporations) to dismiss an antitrust action brought against them by Plaintiffs (American corporations) for lack of personal jurisdiction.

Who's Who?

Plaintiffs     :

Dee-K Enterprises, Inc. – Virginia corporation and purchaser of rubber thread from Defendants;
Asheboro [Elastics Corporation] – North Carolina corporation and purchaser of rubber thread from Defendants.

Defendants :

Heveafil Sdn. Bhd., et al – Malaysian, Indonesian, and Thai corporations engaged in the production of extruded rubber thread, and American distributors.

Facts:

Plaintiffs, Virginia and North Carolina corporations, purchased rubber thread from Defendants to make products such as bungee cords. Plaintiffs sued Defendants, Malaysian, Indonesian, and Thai corporations engaged in the production of extruded rubber thread, alleging a broad conspiracy among Defendants to fix prices and restrain competition in rubber thread. Plaintiffs brought suit in the Eastern District of Virginia. Defendants challenged jurisdiction and venue.

Issue:

Does 28 U.S.C. § 1391(d) allow an alien defendant to be sued in any district, despite the fact that the defendant was not “found” there as required by § 12 of the Clayton Act, 15 U.S.C. § 22?

Decision:

Yes. To obtain personal jurisdiction, a plaintiff must first point to a statute or rule that authorizes service of process over the defendant. Second, the service of process must comport with due process. In this case, the first prerequisite is met by § 12 of the Clayton Act, 15 U.S.C. § 22 (which provides for worldwide service of process against corporate defendants in antitrust actions) and by FRCP 4(k)(2) (under which a defendant who is not subject to any state court's jurisdiction is subject to personal jurisdiction in the federal courts if the assertion of jurisdiction is consistent with federal law, and does not offend the Constitution). The second prerequisite is met because Defendants' appointment of exclusive U.S. Sales representatives and the customization of its products for the U.S. Market supply the minimum contacts required by due process. § 12 of the Clayton Act establishes venue in any district where the defendant is found or where it transacts business. Although it appears that the foreign defendants in this case cannot be found in any U.S. Judicial district, 28 U.S.C. § 1391(d), which provides that aliens may be sued in any district, overrides any special venue statute, including § 12 of the Clayton Act. Venue is therefore proper for the foreign defendants. Plaintiffs have not shown that venue in the Eastern District of Virginia is proper for the American defendants because the alleged Virginia-related contacts of the American defendants are insufficient and the defendants have not been found to be located in the Eastern District.

Basic Rule:

28 U.S.C. § 1391(d), which provides that aliens may be sued in any district, overrides any special venue statute, including § 12 of the Clayton Act.

Terms:

Venue :

The possible or proper location or locations for the trial of a suit.

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