Helicopteros Nacionales de Colombia, S. A. v. Hall

PETITIONER:Helicopteros Nacionales de Colombia, S. A.
RESPONDENT:Hall
LOCATION:Board of Immigration Appeals

DOCKET NO.: 82-1127
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: Supreme Court of Texas

CITATION: 466 US 408 (1984)
ARGUED: Nov 08, 1983
DECIDED: Apr 24, 1984

ADVOCATES:
George E. Pletcher – on behalf of the Respondent
Thomas J. Whalen – on behalf of the Petitioner

Facts of the case

Question

Audio Transcription for Oral Argument – November 08, 1983 in Helicopteros Nacionales de Colombia, S. A. v. Hall

Warren E. Burger:

We’ll hear arguments next in Helicopteros Nacionales against Hall.

Mr. Whalen.

Thomas J. Whalen:

Mr. Chief Justice, and may it please the Court:

As in the cases we heard this morning this case involves in personam jurisdiction over my client Helicol.

Helicol is a foreign corporation in the true sense.

It is a company organized existing in the country of Colombia, and its sole business is the transportation of persons principally in South America.

The jurisdictional issue in this case arises in the context of a wrongful death action which was brought in the State Court of Texas by the family of Dean Hall and several other families who were killed in an accident that occurred in Peru.

Helicol had entered into a contract with American construction companies known as Williams-Sedco-Horn, and this contract was executed in Peru and it was designed to be performed in Peru.

In the course of this helicopter operation it was necessary for the operation of the contract that Williams-Sedco-Horn had with the government of Peru, and they were building a pipeline from the jungles of Peru to the Pacific Ocean.

They needed Helicol to transport workers from construction sites to base terminals in Peru.

On the course of one of these trips an accident occurred in which the Respondents’ decedents were killed along with two other passengers who are not involved in this law suit or this case.

The case was brought in the state court of Texas.

The only contacts that Helicol had with the State of Texas was established in the course of the hearing on a preliminary motion on jurisdiction was the fact that Helicol had a single contract discussion with the personnel of Williams-Sedco-Horn in Houston, Texas, and also in the course of five or six years prior to that contract they purchased equipment from an American manufacturer, Bell Helicopter Company.

Sandra Day O’Connor:

Mr. Whalen, why were Bell Helicopter Company and Williams-Sedco-Horn granted instructed verdicts?

Thomas J. Whalen:

The Plaintiff failed to establish any proof of negligence against either of those defendants, and the court dismissed the case against both of those defendants.

William J. Brennan, Jr.:

Mr. Whalen, was the underlying cause of action based on pilot error?

Thomas J. Whalen:

Yes, Your Honor, against my client.

William J. Brennan, Jr.:

Was the pilot of the helicopter involved trained in Texas?

Thomas J. Whalen:

Yes, Your Honor.

I believe he was.

He was one of the pilots who went to Texas in the course of the agreement between Bell and Helicol for training in connection with the equipment.

William J. Brennan, Jr.:

Was the helicopter itself purchased in Texas?

Thomas J. Whalen:

The helicopter was purchased in Texas, yes, Your Honor.

William J. Brennan, Jr.:

Do you not regard both of those as contacts with Texas on the part of your client?

Thomas J. Whalen:

Yes, Your Honor.

They certainly are contacts, but the idea of purchases being a basis for general jurisdiction, that is, this is a case in which the cause of action did not arise out of the purchase of that helicopter.

Even looking at it from the point of view of the purchase itself without looking at it from the point of view of the verdict of the jury which found that Bell was not at all negligent in the manufacture of the helicopter, the cause of action in this case as the jury found solely was based upon the negligence of our pilot in Peru.

There were no contacts of the Defendant Helicol in Texas which in any way was connected or arose out or created the cause of action in Peru.

William J. Brennan, Jr.:

Unless we regard the training in Texas and the purchase of the helicopter there as bearing on that.

Thomas J. Whalen:

Well, Your Honor, I would suggest that there was no connection and would also suggest that the Supreme Court of Texas among other things ruled that there was no connection between the cause of action and the contacts in Texas, and this is the position which I do not believe my adversary contests.

Thomas J. Whalen:

What we are dealing here if Your Honor please is not a case of contacts in a jurisdiction which gave rise to a cause of action.

What we are dealing with here is a case of what is known as general jurisdiction.

Is Helicol there in Texas?

Do we have an office which we do not.

Do we have employees located there which we do not.

We have no general contacts or base in Texas which under the Perkins case I believe would give a basis for jurisdiction against Helicol with respect to any cause of action.

That is the basis upon which the Supreme Court decided this case.

William H. Rehnquist:

Mr. Whalen, I suppose if the facts were exactly the way they were except that the accident had taken place while they were flying over Texas there would be no question they had jurisdiction to sue Helicol for that particular accident.

Thomas J. Whalen:

There is no question that Helicol under the ruling of this Court, International Shoe, would be subject to the jurisdiction of the court because the pilot error and negligence as well as the resulting injury occurred in Texas and that there were other minimum contacts as well, the contract discussion, for example, and perhaps in those cases in those instances the purchases of equipment could be a basis of additional minimal contacts to support–

Thurgood Marshall:

Would there be any difference if there were an adequate showing that the training itself caused the accident?

I mean, if he was poorly trained and that was proved.

Thomas J. Whalen:

–No, Your Honor, I would suggest not.

Thurgood Marshall:

Would that make a difference?

Thomas J. Whalen:

It would make no difference because the cause of action arose in Peru.

It would not have arisen in Texas.

Thurgood Marshall:

Suppose he was trained if he turns to the left he should boot it to the right, and that is what wrecked the plane and everybody in the world agrees that that was wrong.

Thomas J. Whalen:

Well, his–

Thurgood Marshall:

And he was taught that in Texas.

Thomas J. Whalen:

–Well, if he was–

Thurgood Marshall:

It is your position that that has nothing to do with it.

Thomas J. Whalen:

–If he was improperly taught by Bell Helicopter then, of course, Bell helicopter stands to be liable.

If he violated his teaching, what he was taught, in Texas in Peru then that negligence and the conduct or the result of that negligence would all have occurred in Peru.

There is no connection I think under Your Honor’s example if you please that there is no connection under your example between the faulty training and the accident in Peru.

Sandra Day O’Connor:

Mr. Whalen, if the suit had been brought in Peru could Bell Helicopter and Williams-Sedco-Horn have been sued in Peru–

Thomas J. Whalen:

Yes, Your Honor.

Sandra Day O’Connor:

–It had jurisdiction in your view?

Thomas J. Whalen:

Yes, Your Honor.

As a matter of fact we raise this question… We introduced our special appearance which procedurally is the way in Texas we raised a jurisdictional objection.

We raised it approximately eight months after the accident so if there was a jurisdictional problem then, of course, a protective suit would be filed in Colombia or in Peru in the event jurisdiction as we believe should not be found in Texas on this course of action.

After the jury returned its verdict we had to continue after the jury returned its verdict and we appealed solely on the jurisdictional issue.

Thomas J. Whalen:

The case went to the intermediate Court of Appeals where it reversed the decision of the trial court that the court had in personam jurisdiction over Helicol.

The other side then appealed to the Supreme Court of Texas and the Supreme Court of Texas initially affirmed the decision of its intermediate Court of Appeals, but my adversary then filed a petition for rehearing and the Supreme Court of Texas reversed.

It is our position that the contacts or the issue in this case is one of solely general jurisdiction that the contacts that Helicol had in Texas were insufficient to form a basis for general jurisdiction.

As the United States government–

Sandra Day O’Connor:

Mr. Whalen, do you rely at all on the contract provision that provides for jurisdiction of disputes in Peru?

Thomas J. Whalen:

–No, Your Honor, I do not.

I would interpret that provision as determining the rights of the parties to that contract which in that case would be Williams-Sedco-Horn and Helicol.

I do not rely on that decision but it does indicate the intention of the parties particularly Helicol to remove any basis for jurisdiction by any United States court.

Their operation–

Sandra Day O’Connor:

Well, if the contract provision means what it says and if you were to rely on it I suppose the contract was entered into in a sense in Texas and that might give Texas jurisdiction.

Thomas J. Whalen:

–If I may, Your Honor, the contract was not entered into in Texas.

There were contract discussions and the cause of action, the negligence cause of action, to the Respondents who are before the Court did not arise out of that contract.

It arose simply out of the negligence on the part of the pilot of Helicol.

So again I suggest to the Court that there is no basis for finding that the cause of action in this case arose out of that contract.

Sandra Day O’Connor:

So you would like to forget all about the contract provision at least for purposes of this argument in this case?

Thomas J. Whalen:

Yes, Your Honor, for the purposes of the jurisdiction of these Plaintiffs against this Defendant on the Plaintiffs’ cause of action.

If the position that the Supreme Court of Texas is to be upheld that the purchases of $4 million worth of equipment from an American vendor which is the principle contact which the Supreme Court of Texas relied on for general jurisdiction then it would appear that any time a foreign company purchased American products from an American vendor no matter what its extent that if there is a cause of action which is unrelated to those purchases that foreign purchaser could be dragged into American litigation and all the expenses involved in it solely because of the purchase of American products.

As the United States government in this case succinctly but pointedly established this would as a policy matter be against the export policy of the United States.

In the decisions of this Court certain policy matters have entered into the decisions as to whether there should be or should not be jurisdiction.

One of the policy matters in some of the cases has been the residence of the Plaintiff.

I should point out in this case that none of the Respondents were residents of Texas.

So we have in this case Plaintiffs who are nonresidents of Texas suing a company which is not based in Texas on a cause of action which occurred in Peru, and as the Supreme Court and the Respondents acknowledge there is no connection between the contacts of Helicol in Texas and the ultimate cause of action which was brought against Helicol in the State of Texas.

The decisions of this Court from International Shoe through Volkswagen have emphasized that there must be a relationship between the parties, the litigation and the forum if jurisdiction is to be established over a nonresident who is not based in the forum state.

In this case I suggest to Your Honors that Helicol in no way was based in Texas, and lacking that finding which the Supreme Court of Texas acknowledged there can be no basis for in personam jurisdiction over Helicol on an unrelated cause of action.

I think this Court respectfully is bound by the findings of the Supreme Court and of the Court of Civil Appeals that the cause of action in this case did not arise out of the contacts of Helicol in Texas.

Sandra Day O’Connor:

Mr. Whalen, are there any circumstances in which a purchaser or a buyer of goods in the forum state would be sufficient simply because of the quantity purchased, let’s say, or the frequency of that occasion to provide general jurisdiction over that buyer?

Thomas J. Whalen:

Yes, Your Honor.

If the business of the company was the buying and selling of helicopter equipment and that the company went into Texas to buy equipment for the purpose of reselling it then in that case I would suggest that that company by buying that equipment would be doing some business under those circumstances.

But whereas Helicol was buying capital goods for the use of its business in South America its business is not buying and selling equipment.

Its business is transporting people in South America.

Thomas J. Whalen:

So the purchase of capital goods I suggest to the Court cannot be the basis for a finding of doing business, and I believe that this was the gist of Justice Brandeis’ decision in the Rosenberg case which I’ve cited in my brief in which he points out that purchases are not doing business.

That was a case arising in New York.

Sandra Day O’Connor:

I am not sure that that distinction alters the relationship of Texas with the buyer though.

Thomas J. Whalen:

I am sorry, Your Honor.

I do not understand the question.

Sandra Day O’Connor:

Well, if the purpose of the inquiry is to determine the extent of contacts with the State of Texas in this case the forum state for the purpose of inquiring what interest the state of Texas would have and the degree to which Texas, for instance, might want to consider the interests of the buyer I would think it would not make such difference why the buyer planned to buy the goods.

Thomas J. Whalen:

But the cause of action, Your Honor, was based upon that purchase, and I would agree with you that that would be a contact on which jurisdiction would be based against Helicol, that is, if Helicol failed to pay for its equipment and Bell wanted to sue Helicol for its failure then I believe that Helicol plus other contacts… Those purchases plus other contacts would form a basis for jurisdiction because the cause of action arose out of those contacts.

I hope I have answered your question, Your Honor.

I am not certain I have.

Byron R. White:

Well, suppose Helicol was doing business and it qualified to do business in Texas, the kind of business it does.

It furnishes helicopter transportation I guess, does it not?

Thomas J. Whalen:

Yes, Your Honor.

Byron R. White:

Suppose it was qualified to do business in Texas on that basis but suppose that it was also in business in Peru and on the side it was in the real estate business and it borrowed some money to buy some real estate and did not pay the note.

Could it be sued in Texas on that note?

Thomas J. Whalen:

On your facts, Your Honor, yes it could because I think the first point that–

Byron R. White:

That would not have arisen out of any of the business they did in Texas.

Thomas J. Whalen:

–Excuse me, Your Honor.

I thought you said that Helicol was authorized to do business in Texas–

Byron R. White:

It was, but not a real estate… The only business it ever did in Texas was the transportation business.

Thomas J. Whalen:

–I would interpret–

Byron R. White:

You think that is general jurisdiction.

That is the presence.

It is present.

Thomas J. Whalen:

–I think if it consents if it files with the state and says I want to do business in this state I in effect consent to the general jurisdiction and I recognize that the case that the amicus brief, not the United States, the other brief, has contested this point, but my view is that if a company files with a state asking for authority to do business I believe under one of the older Supreme Court decisions that he has consented to jurisdiction, and I would consider that a consent to be sued on any cause of action.

Byron R. White:

But just a purchaser of a helicopter who does business in Peru… He buys a helicopter in Texas.

He does helicopter business in Peru.

He could not be sued on the note that he signed to buy some real estate in Peru.

Thomas J. Whalen:

That is right.

He could not, Your Honor, under no circumstances.

Byron R. White:

Which you say is like this case.

Thomas J. Whalen:

Yes, Your Honor.

If there are no questions, I would like to save some time for rebuttal.

Warren E. Burger:

Mr. Pletcher.

George E. Pletcher:

Mr. Chief Justice, and may it please the Court:

My clients it is true were not residents of the State of Texas.

Their relationship with the State of Texas was purely with Williams-Sedco-Horn which was domiciled in the State of Texas in Houston.

These four men were employed in Texas by Williams-Sedco-horn to work over in Peru.

My clients had absolutely nothing to do with any of the Helicol contacts with the State of Texas.

They came into the State of Texas based upon the record in this case, and the discovery was limited to that area of time from 1970 when the helicopter which crashed in Peru was purchased in Texas up until the time of the special appearance motion being heard.

Helicol came into the State of Texas for far greater reasons than simply to buy some helicopters and some helicopter parts.

In addition to purchasing the helicopter which crashed this company purchased approximately 80 percent of its fleet, and it purchased virtually all of the parts that were necessary to keep that fleet going.

They also had pilots who were trained in the State of Texas, and they also had their maintenance personnel who were trained in Texas.

They did not stay in Colombia and order helicopters and parts from the State of Texas and then wait for them to be delivered.

They sent their people to Texas and they sent their people from the head man in that company, Mr. Restrepo, the executive vice president, the head of the maintenance department of that company as well as their pilots and their maintenance personnel.

The records in this case will indicate that there were some 33 different business trips taken to the State of Texas by various officials and employees of this company.

Now when this incident occurred in Peru the Plaintiffs were immediately faced with one fundamental problem and that was where could their rights be determined.

Knowing that this Court has for the last 38 years affirmed and reaffirmed the standard of minimum contacts established in International Shoe, the cornerstone of a jurisdiction in personam case must be that there be certain minimum contacts.

William H. Rehnquist:

Mr. Pletcher, were any of the Plaintiffs domiciled in Texas?

George E. Pletcher:

No, Your Honor, not one of them, none of the decedents nor any of their families.

The families were from Illinois, two families from Oklahoma and one family from Arizona.

Helicol had absolutely nothing to do with Illinois.

They had nothing to do with Arizona and had nothing to do with the State of Oklahoma except for one brief overnight stay there on the way to Texas to discuss the contract which has already been mentioned in the opening argument by my adversary.

The states of whom my people were resident could not hear their case because under this Court’s ruling of no contacts, no jurisdiction then those three states could not possibly have passed upon my clients’ rights.

William H. Rehnquist:

Even though one of their domiciliaries had been killed as a result of the claimed negligence?

George E. Pletcher:

I think that this Court’s decisions have repeatedly reaffirmed, Your Honor, that unless there be minimum contacts then nothing else matters, that it simply–

William H. Rehnquist:

I suppose in Volkswagen the Plaintiff was clearly resident of Oklahoma, but that was really all that was going–

George E. Pletcher:

–Yes, sir, that is all there was in Volkswagen.

But without those minimum contacts this Court has held repeatedly there can be no jurisdiction.

Byron R. White:

–Well, your position I take it is that it does not make any difference what kind of a cause of action that is being pressed against the helicopter company as long as it has these minimum contacts in Texas.

George E. Pletcher:

No, Your Honor.

George E. Pletcher:

My position is that having once established minimum contacts which has been done, and I think there is no dispute that there is at least minimum contacts in this case, that then the focus of attention shifts from merely what did the defendant do in the forum state to examining the case from its four corners and particularly in this Court’s opinion written by Your Honor in the Volkswagen case and that is where else can the Plaintiffs go to have their cause of action heard.

Byron R. White:

Well, would you say that… Suppose some United States company sold the helicopter company some gasoline to be delivered in Peru and the helicopter company did not pay its bills.

Could it be sued in Texas on that bill just because it has these minimum contacts?

I would think you would say yes.

George E. Pletcher:

Yes, sir.

I think that is the single act contact cases that are in both federal and state courts in quite a state of disarray.

Byron R. White:

Yes, but the United States company selling the gasoline had absolutely nothing to do with Texas.

George E. Pletcher:

I am sorry.

I misunderstood the Court’s–

Byron R. White:

It shipped the… It is from California.

It ships it out of California, but it sues in Texas just because that is where it wants to sue.

George E. Pletcher:

–No, sir.

No, sir.

I do not believe then that jurisdiction would be permitted, and I think that it would not be permitted–

Byron R. White:

So you think the focal point is whether they can sue any place else?

George E. Pletcher:

–Well, if they could sue any place else, that is, the situation in my case here is that there is no place else in the United States–

Byron R. White:

Except Peru.

George E. Pletcher:

–Except Peru or Colombia.

William J. Brennan, Jr.:

Mr. Pletcher, you said that there is no issue here of minimum contacts that they conceded?

George E. Pletcher:

I think, Your Honor, that they conceded except insofar as the quality and the quantity and the importance of those contacts, but that the contacts exist I think is–

William J. Brennan, Jr.:

Would you summarize them, Mr Pletcher?

George E. Pletcher:

–Yes, sir.

There was in addition to those that I have already mentioned, Justice Prennan, there was the purchase of the helicopters.

There was the repeated purchases to the tune of about $50,000 per month of parts.

There was the training of the pilots.

There was the training of the maintenance personnel–

William J. Brennan, Jr.:

Including the pilot of this plane?

George E. Pletcher:

–Yes, sir.

There was the plant familiarization.

The record will indicate and my adversary points out in a reply brief that although it never came to fruition Helicol was trying to get to become a designated repair facility for Bell Helicopter over in Colombia.

George E. Pletcher:

They had on three occasions their head man and their maintenance department come to Fort Worth three different years for plant familiarization.

In addition to that if it please the Court the general manager of this Colombian corporation came to Houston, Texas.

He came there to discuss and negotiate the very contract that counsel spoke of.

Now it is true.

We have never claimed that that contract was executed in Texas because it was not.

It was executed in Peru because it had to be executed in Peru.

But it was negotiated right in Houston, Texas.

Williams-Sedco-Horn was a group of three companies that was formed purely and simply to do this work over in Peru.

John Paul Stevens:

Mr. Pletcher, is that negotiation of the contract which was the source of the business they did in Peru really any different from the purchase of the helicopters themselves?

They got the raw material and the contractual rights and all with which to carry on their business in Peru.

They got those in Texas.

But aren’t those all just a more dramatic example of the case that your opponent says is controlling here, the case that holds the purchases are not enough?

George E. Pletcher:

Well, Your Honor–

John Paul Stevens:

Are you asking us to overrule that case I guess is the bottom line of my question?

George E. Pletcher:

–Am I asking you to–

John Paul Stevens:

Overrule the Rosenberg case.

George E. Pletcher:

–No, sir.

I am not asking you to overrule that case at all.

What I am suggesting though is that that case since it was decided 23 year before the minimum contact standard was ever established and dealt purely with the question of whether or not purchases alone equated with corporate presence which was the fiction which was then being used and which was later abandoned by this Court.

That is no longer controlling in a case involving commercial contacts which is now the minimum contact standard.

I do not think that the Rosenberg decision needs to be overruled.

I just think that it is–

John Paul Stevens:

Well, would you think you had enough if there was nothing in the case except the purchase of the helicopters?

George E. Pletcher:

–I certainly would not have enough in the case if counsel persuades this Court to ignore purchases as he requests.

John Paul Stevens:

My problem is you have got purchases plus training plus the negotiation of the contract that enable you to do business.

George E. Pletcher:

Yes.

John Paul Stevens:

I am not sure any one of those is different from the other two analytically.

That is my problem.

George E. Pletcher:

Well, they are different only to the extent that one is frank purchase of goods and the other is a negotiation of a contract to perform services.

Thurgood Marshall:

Do you put great weight on the fact that they purchased 80 percent of their flying equipment in Houston?

George E. Pletcher:

Yes, sir.

Thurgood Marshall:

How many planes was that?

George E. Pletcher:

I believe they bought five helicopters in Fort Worth.

Thurgood Marshall:

You said 80 percent you think it is a number don’t you?

Why didn’t you say five instead of 80 percent?

George E. Pletcher:

Well, because the percentage was the word that was given by Helicol.

That is where we got our information about what percentage of their fleet was purchased in Texas.

Byron R. White:

Do you think your opponent concedes that… I should have asked him.

Maybe I still will… concedes that if they had not paid for the helicopters they could be sued in Texas for the purchase price?

George E. Pletcher:

I do not know if he would concede it, but he should concede it, Your Honor.

Are you talking about if Bell–

Byron R. White:

Well, I know you think he should concede your case.

George E. Pletcher:

–Bell certainly would be entitled to sue for the failure of Helicol to pay for their helicopters.

Byron R. White:

Based on minimum contacts.

George E. Pletcher:

Yes, sir, based on minimum contacts and arising out of the transaction.

Byron R. White:

You think it is a prevailing law that if you purchased goods in a state if that is the only thing you do in a state purchasing from abroad you can be sued in that state for the purchase price.

Is that a general rule you think?

George E. Pletcher:

No, sir.

I think that–

Byron R. White:

The cases are split.

George E. Pletcher:

–Yes.

I think that is where the division of authority is.

I think that is where that disarray is that–

Byron R. White:

A fortiori there would be a big split on this one?

George E. Pletcher:

–Yes, sir.

Byron R. White:

Do you have some cases that support you?

George E. Pletcher:

Well, Your Honor, I have basically the Perkins case.

The Perkins case is not unlike this case except in one way and that is that there the Philippine company president because the Japanese had taken over the Philippine Islands flew back to his home state of Ohio and was actually physically present there.

But the basic factual situation in that case is the same as it is here.

William J. Brennan, Jr.:

Is Perkins relied on below?

George E. Pletcher:

Oh, yes, sir.

Because there in the Perkins case a nonresident plaintiff sued a nonresident defendant on a cause of action which was entirely unrelated to contacts within the state, and there this Court held that Ohio did not have to open its courts but it was not constitutionally prohibited from doing so.

That is basically our argument and has been from the outset in this case is that the contacts with this nonresident defendant were so pervasive and over such a long period of time and of such substance that it is then what we ask the Court to do and what this Court has said is a proper thing to do is to look at the other factors in this case as to whether or not it is reasonable and fair to ask a nonresident defendant to appear in the forum state to defend a cause of action.

It is our belief and we urge upon this Court that once you look at this case on those other relevant matters they all come down favoring the Plaintiffs.

Byron R. White:

So you… Just any cause of action that might exist against the helicopter company could be brought in Texas?

George E. Pletcher:

Only if it is fair and reasonable to do so, Your Honor.

That is the second protection that a nonresident–

Byron R. White:

Well, a resident of Ohio buys some stock in the helicopter company and the company is not doing very well and they think the directors are guilty of fraud or something so they want to bring a derivative suit.

Can they bring a derivative suit or can they sue the directors of the helicopter company in Texas, sue the helicopter company itself?

George E. Pletcher:

–Yes, sir.

I believe they could if it is shown that the helicopter company is doing business on a consistent basis in Texas.

Byron R. White:

You mean on these very facts of yours you think that suit would lie?

George E. Pletcher:

Yes, sir.

They have a general presence in the State of Texas under those circumstances.

It is for that reason that it is fair and reasonable to expect them to come in and defend that case.

But, Your Honor, the fairness doctrine which is the second peg of the minimum contacts standard set forth in International Shoe protects defendants against those kind of cases that in a given case may render it unfair and unjust and not in keeping with the traditional notions of fair play.

There is another matter that I would like to discuss particularly with reference to a question by Justice O’Connor, and that is whether or not in the country of Peru the plaintiffs could have sued Bell Helicopter Company.

Your Honor, from this record I think that it is not possible even if we assume that the country of Peru has the same jurisdictional standards that we have in this Court.

I think that there is absolutely no showing that Bell helicopter had any contacts with the country of Peru topside or bottom.

That is one of our problems and was from the beginning of this case.

In Colombia the record would reflect Bell helicopter has a representative but Williams-Sedco-Horn has nothing to do with that country.

The only place in the United States that my clients could have their rights established was in Texas, and the only place on earth that the Plaintiffs and the three Defendants could all be joined together in one cause of action to efficiently dispose of this case was in the State of Texas.

A question was also asked about why was an instructed verdict granted as to Williams-Sedco-Horn and Bell Helicopter, and it is true that the Plaintiffs, my clients, failed to raise a fact issue as to negligence or product defect as to either of those Defendants.

It is also true that the helicopter company’s claim of defective helicopter was also not such as to raise a fact issue.

A case such as this is almost a certainty.

When a helicopter flies into a tree in a fog and all hands are killed either there was pilot error, there was a problem with the contractor pressuring the flying company to fly in that weather, or there was something wrong with the helicopter.

Those were all issues in this case from the outset by one party against the other parties.

When this case was finally tried and when all of the evidence was in those claims and those cross claims were all thrown out of court as far as Williams-Sedco-Horn and Bell helicopter leaving only Helicol and the Plaintiffs in the case submitted to the jury and the jury found as counsel has indicated.

John Paul Stevens:

May I ask… I take it the pilot was not a defendant.

George E. Pletcher:

I beg your pardon?

John Paul Stevens:

The pilot was not a defendant?

George E. Pletcher:

The pilot was not.

The pilot was killed as well and his estate was–

John Paul Stevens:

His estate was not named?

George E. Pletcher:

–No.

Only the company was named as a defendant.

Unless there are further questions, that is all the time I need to take.

Thank you very much, Mr. Chief Justice.

Warren E. Burger:

Very well.

Do you have anything further, Mr. Whalen?

Thomas J. Whalen:

Yes, Your Honor.

My adversary in this case apparently is prepared to have the case decided on the Perkins case.

He says that this case is identical to the Perkins case.

The facts in the Perkins case are that it was a company that was principally doing business in the Philippines and because of the war in effect had to leave the Philippines and set up operations in Ohio.

The president was there.

They actually operated business, all kinds of business, from Ohio.

They had employees, payroll, bank account, offices, employees located there.

They had set up shop, and the position I think of this Court in the Perkins case was as a commentator says it is never a violation of due process for a defendant to be sued in his own backyard.

In that case the defendant had in effect set up an office.

He was equivalent to a domiciliary and under those circumstances a defendant should be subject to suit on any cause of action, and that is essentially what this Court held in that case.

Perkins came after International Shoe and Perkins was in a sense signaled by International Shoe because the language in International Shoe suggested that there would be circumstances in which the contacts were so great they were substantial, continuous, systematic doing business that the cause of action would not necessarily have to arise out of those facts in order as a matter of due process jurisdiction could be had.

I would like to point out to the Court this Court in International Shoe cited the Rosenberg case, cited it indicating that it still had strength even after International Shoe.

I would point out in Rosenberg and to this extent Rosenberg may very well have been changed to some extent by International Shoe.

In that case the cause of action arose out of the conduct in New York although it is not clear from the facts as to whether it arose out of the purchases.

Notwithstanding the fact in Rosenberg that the cause of action arose out of conduct in the State of New York, the Court in that case said that purchases… the purchase of a significant amount of capital as well as inventory is not sufficient to form basis for jurisdiction over that defendant.

I think my adversary’s position in this case is simply that he represents United States citizens and that his court, the Texas court, should provide a forum somewhere in this country–

William H. Rehnquist:

Mr. Whalen, if there were kind of a world-wide due process clause administered perhaps by the World Court of the Hague and that court had decided a world International Shoe case talking about minimum contacts for a country certainly somewhere in the United States should qualify as minimum contacts to adjudicate this dispute don’t you think?

Thomas J. Whalen:

–No, Your Honor.

There are no minimum contacts as I understand the doctrine of minimum contacts from International Shoe that the cause of action simply did not arise out of those contacts.

William H. Rehnquist:

Well, it did not arise but all the plaintiffs reside in the United States.

William H. Rehnquist:

Certainly the defendant had some contacts with the United States.

I grant you so far as Texas when you try to pick one out of several of the United States no one of them seems very strong, but I have a rather strong conviction that somewhere in the United States there ought to be jurisdiction to try this.

Thomas J. Whalen:

Your Honor,–

William H. Rehnquist:

One does not decide on those feelings.

I realize that.

Thomas J. Whalen:

–The constitutional due process which is the argument I am proposing to this Court is the due process which should be accorded to this Defendant.

I would suggest to Your Honor that if this Defendant constitutionally cannot be subject to suit this Court should not find jurisdiction where he can be sued simply because the Plaintiffs are United States citizens.

I do not believe as a matter of the United States Constitution that a U.S. citizen is guaranteed a forum for any causes of action on any basis in this country.

I believe that that is the fundamental basis of the argument of my adversary.

This Court because they are the United States says it must find a forum.

I think that in this case under the present rulings of this Court there is no basis because of the contacts of Helicol with the jurisdiction in Texas… There is no basis for holding Helicol subject to the jurisdiction of Texas on this cause of action.

My adversary has not disputed the fact that… What he is relying on are solely the purchases of capital equipment in Texas and a single contract discussion which lasted only about two hours in the City of Houston, and that is the basis upon which he is claiming that my client is subject to suit on a cause of action which happened in South America.

I suggest to the Court–

John Paul Stevens:

Mr. Whalen, let me ask the question I think you have not answered.

Supposing the suit was not arising out of an airplane action in Peru but rather supposing your client had not paid for the helicopters and the manufacturer wanted to sue them.

Could they sue your client in Texas?

Thomas J. Whalen:

–Your Honor, on those facts alone I would state they could not sue.

John Paul Stevens:

Even though the cause of action arose out of the activity in Texas which would be unlike this?

Thomas J. Whalen:

I understand Mr. Justice White’s dissent to a denial of certiorari in the Lakeside case.

There was a discussion of whether those facts alone were sufficient to form a basis of jurisdiction over a defendant simply on a telephone call or–

John Paul Stevens:

Let me change it.

Say they did not pay for the training school for their pilots.

They bought the helicopters and they had them trained in Texas and then they did not pay for the instruction on how to fly the helicopters.

I suppose that is pretty close to the same.

Thomas J. Whalen:

–That is pretty close to the same.

I would say that there would be… I do not think I would be prepared to say that that satisfies even the minimum contacts doctrine of International Shoe.

It has got to be more than that.

That would be my position, Your Honor, although admittedly it is a close case.

In Volkswagen, of course, the cause of action did arise in Oklahoma and this Court nevertheless with respect to two regional distributors found that there was not jurisdiction over those defendants.

Following the rationale I believe of the Court’s opinion in that case I do not think that simply the fact that a cause of action arose would be sufficient–

John Paul Stevens:

No, but it arose out of a commercial relationship in my hypothetical which is an unsatisfied debt and so forth.

Well, anyway I understand your position.

Thomas J. Whalen:

–I think it is a close question, Your Honor.

I would not… It is a close–

John Paul Stevens:

Anyway that is a different case.

Thomas J. Whalen:

–It is a different case, Your Honor.

In this case the contacts of Helicol in Texas did not in any way give rise to the cause of action on which the Plaintiff has brought his claim, and I submit that that is the critical distinction and this Court should follow Perkins and dismiss the case.

If there are no further questions I will submit.

Warren E. Burger:

Thank you, gentlemen.

The case is submitted.