Q. In the class you mentioned that Murphy filed the suit under two existing statutes:

1)a federal drug statute that creates no private cause of action

2)a federal civil rights statute that was created to allow private persons to sue public officials (Zarc being not a public official)

As we discussed, Murphy had no right to action under both of these statutes. How is it then, the complaint was allowed to be filed and moved forward to discovery? The text within the case mentions that the defendants' council notified this to the plaintiff's counsel, but never moved for dismissal? Why would the court allow this, what possible reason would the defendant want to continue the suit once it is made clear that plaintiff has no "legal viability" under these statutes?

A. This is an excellent question. I am unsure why there was no motion to dismiss the drug statute action for failure to state a claim. The defendants really should have. As for the civil rights action, it is POSSIBLE for a private citizen (or company) to be sued under 42 USC § 1983 as a state actor, although the level of connection between the private actor and the state government must be so high that the former really amounts to an arm of the latter. I don't think that is satisfied even assuming Murphy's allegations to be true, but I guess there was sufficient uncertainty for Zarc to not try a motion to dismiss.

Finally, Murphy's allegations, if true, would certainly add up to valid state law causes of action (e.g. battery?) against Zarc. So there would still be causes of action that could not be dismissed for failure to state a claim. That may be the main reason why the case continued. (We will discuss later the question of federal subject matter jurisdiction for these associated state law claims, assuming that diversity was not satisfied.)

Good question.

4. R. 11 and the Rules Enabling Act

Q.  I had a question about Rule 11, if it would be more appropriate to wait until the next review session, office hours, or class, I will happily wait and talk to you at the next opportunity, if however you don't mind email questions, (I'm fairly sure you said it was fine), here goes:

The Rules Enabling Act, which allowed the Supreme Court to create the Federal Rules of Civil Procedure says that the rules "shall not <>abridge, enlarge or modify any substantive right" and Roberts in Sibbach says that substantive rights are confined to rights conferred by law to be protected and enforced in accordance with the adjective law of judicial procedure.

Rule 11, which nominally is about signing the pleadings, motions and what not, is really "to deter dilatory and abusive tactics in litigation, and to streamline the litigation process by lessening frivolous claims or defenses" at least in part, according to McAvoy in the Murphy v. Cuomo case.

It seems to me that while the goal of Rule 11 certainly makes sense, is it truly good policy to allow procedural law to not simply dismiss a claim, but to punish those who brought it?   Deterring frivolous and abusive litigation, and saving money, are both noble goals, but it seems more the role of substantive law than procedural law.

I suppose the heart of the question is, should procedural law be able to punish beyond the scope of the proceedings (like a monetary fine past costs), and still be called procedural law?

A. So the argument is that R 11 is substantive because it sets up a penalty rather than simply dismissing the action? I don't see why that follows. First of all, dismissal of an action (if it is with prejudice) is one of the most draconian penalties imaginable.  Second, as you will see later, much procedural law is backed up by penalties similar to those in R 11.

But the most important problem with your argument is that you have drifted away from the Sibbach definition of substantive rights. As you correctly put the Sibbach definition, "substantive rights are confined to rights conferred by law to be protected and enforced in accordance with the adjective law of judicial procedure." So imagine I bring a frivolous intentional infliction of emotional distress action against you and am sanctioned under R 11. The substantive right at issue is the right not to be submitted to intentional infliction of emotional distress. How is that substantive right abridged enlarged or modified by my being sanctioned?

It is true that R 11 protects your right not to be submitted to frivolous actions. But you have not explained why this right isn't, in this context, procedural rather than substantive.

Followup Q. I suppose my thinking was that procedural rules should carry only procedural penalties (like dismissing the claim in an extreme case) to remain procedural in nature.  For example, if the penalty for a frivolous claim was jail time, it would seem to violate a substantive right (the eight amendment) for the violation of a procedural rule. It's a matter of degree I realize, but drawing a line between punishments within the scope of procedure and punishments that go outside that scope, like jail time or fines in excess of court costs, seems intuitive for a procedural rule violation.

Followup A.
I see what you are thinking. It seems that your problem with R 11 is not really that it abridges enlarges or modifies a "substantive right" (as that term is used in the Rules Enabling Act). It is that it is punitive, insofar as it seeks to deter conduct by sanctioning it. But I don't see why the punitive nature of R 11 is a problem.

To be sure there might be problems with *excessive* punishment for R 11 violations. The 8th A might be violated. But even then it is not clear why in that context the constitutional right that is violated would be substantive. Remember, substantive is not the same thing as important. In any event, R 11(c)(4) limits sanctions "to what suffices to deter repetition of the conduct or comparable conduct by others similarly situated." And, of course, jail time is not an option under R 11.

Furthermore, in other circumstances a court can jail someone for either civil or criminal contempt. R 37 envisions contempt sanctions as a possible for failure to comply with a discovery order (except for failure to comply with an order to submit to a medical exam). Do you have a problem with R 37 too?

Further followup Q: It is not specifically that R 11 can be punitive, but that it's sanctions can exceed what I would consider procedural sanctions. Contempt, such as is possible for a R 37 violation, has the same issue.

It's not that I don't understand why these sanctions exist, clearly there is a benefit in deterring frivolous action and a benefit to enforcing the law of the court,

To have these sanctions go beyond an effect on the litigation, to go out of the inner workings of the judicial system and effect the life and liberty of people sanctioned in ways not directly related to the process of procedure, seems to require a law stemming from an authority higher than that of judicially created procedure, like the state or federal legislature.

It is true that Congress in the creation of the FRCP delegated some of its power to create law to the Supreme Court, but it also imposed a limitation on that power.  Obviously the court has not interpreted that limitation in the way I'm suggesting, but the reason why seems more practical than principled.

Further followup A:
I think it is implausible that Congress intended the "abridge enlarge or modify any substantive rights" language to limit FRCPs to those that did not impose contempt sanctions of the sort that one finds in R 11 or R 37.  (Do you have any evidence that Congress had this intent?) The power of courts to punish disobedience through both civil and criminal contempt was recognized under English law. It was a power that colonial courts had before the ratification of the Constitution. Indeed it is hard to imagine a court without at least some contempt power. If the relief granted to a plaintiff is an injunction upon the defendant (for example to refrain from polluting the plaintiff's property), how could that injunction be enforced if the court could not punish disobedience? Given the long history and the great importance of the contempt power, it would be bizarre that Congress would limit FRCPs only to those that did not employ this power (leaving the matter of contempt for statutory regulation). After all, as the court put it in Sibbach, the FRCPs are supposed to govern the whole field of federal district court procedure and that could not be true if contempt issues were excluded.

5. Leaving summons and complaint with someone less than 18.

In the class yesterday, you have mentioned that there are arguments that can be made to rule that a person of less than 18 years of age can receive a complaint and summons. Specifically, the rule regarding who may serve, which restricts the age to 18 and over does not appear to apply to rule 4(e), which states who may receive the documentation.

However, the rule 4(e)states that a person other than a minor may be served. Is there a federal age guideline for who can be considered to be a minor? Isn't 18 a generally expected age of adulthood? if that's the case, it must be argued that "a person of suitable age" and not a minor is a person who is at least 18 years old.

Please clarify.

A. Some preliminaries first. The person "served" is the person being sued (usually a defendant). R. 4(e)(2)(B) allows an individual to be served by "leaving a copy of [the summons and complaint] at the individual’s dwelling or usual place of abode with someone of suitable age and discretion who resides there." In such a case, the person of suitable age and discretion who gets the summons and complaint is not being served. She, after all, is not being sued. Instead leaving the summons and complaint with this person of suitable age and discretion is the means by which the defendant is served.  Now it seems entirely possible that someone less than 18 could be this person of suitable age and discretion. (Indeed, service through delivery to a defendant's 16 year old daughter has been upheld. See De George v. Mandata Poultry Company, 196 F. Supp. 192 (E.D. Pa. 1961).)

As I mentioned in class, the language in R. 4(c)(2), which says that "[a]ny person who is at least 18 years old and not a party may serve a summons and complaint," is not relevant here, since that language is about who may serve, not about who is a person of suitable age and discretion to receive the summons and complaint for the defendant.

Now let us turn to the passage that you identify at the beginning of R. 4(e). This says, "Unless federal law provides otherwise, an individual — other than a minor, an incompetent person, or a person whose waiver has been filed — may be served in a judicial district of the United States by..." This language is also irrelevant to who is a person of suitable age and discretion to receive a summons and complaint for the defendant. It refers to the type of defendant who may be served under R 4(e), not to the type of person to whom the summons and complaint may be given in order to serve a defendant.

There is a different rule, R 4(g), that discusses how to serve a minor if it is a minor who is being sued. (In general this is done by delivering the summons and complaint to the minor's guardian.) I did not discuss R 4(g), because, as I mentioned at the start of my discussion of service, you are responsible only for the service rules 4(e) and 4(h), not for the rules for serving minors and incompetents, the United States, individuals in foreign countries, state officials, etc.

In short, the language about minors is irrelevant to who is a person of suitable age and discretion to receive the summons and complaint under 4(e)(2)(B). It merely says that R 4(e) does not govern cases in which the defendant is a minor. R. 4(g) does that.

6. Question about scope of Art. III diversity and scope of diversity under 28 USC § 1332.

Q. P. 90-91 in Glannon talk about how Congress restricted Art III s. 2 of the Constitution with 28 USC 1332.  It mentions the Strawbridge case as requiring complete diversity (no opposing parties from the same state).  But then it says that State Farm Fire & Casualty v. Tashire changed that rule to require only “some” opposing parties to be diverse.  I read the opinion in that case, and the Court addresses the Strawbridge test, saying  “But Chief Justice Marshall there purported to construe only "The words of the act of congress," not the Constitution itself. 6 And in a variety of contexts this Court and the lower courts have concluded that Article III poses no obstacle to the legislative extension of federal jurisdiction, founded on diversity, so long as any two adverse parties are not co-citizens. 7 Accordingly, we conclude that the present case is properly in the federal courts.”
 
However, in the questions, examples 1d and 5 say that no diversity exists because it fails the Strawbridge test.  Is Glannon wrong here, or is the Strawbridge holding still the law to determine diversity jurisdiction, Tashire notwithstanding?

A. Glannon is not wrong. It is crucial to understand that one cannot talk about "diversity" here without identifying which of the following two things is at issue: 1) the scope of diversity jurisdiction in Art. III of the U.S. Constitution or 2) the scope of diversity jurisdiction in 28 USC § 1332 (the diversity statute). The scope of Art. III diversity concerns the furthest scope of the federal judicial power under the Constitution. It helps delimit the furthest that the federal courts CAN go. But the question of how far Congress has chosen that they WILL go is determined by statute, in particular, 28 USC § 1332. Congress cannot pass a statute that goes beyond the Art. III limits of diversity. But they can choose by statute to give federal courts less jurisdictional power than could constitutionally be exercised.

Now Strawbridge is about the scope of 1332, not the Constitution. As it was put in State Farm Fire & Casualty v. Tashire: In Strawbridge, "Chief Justice Marshall ... purported to construe only 'The words of the act of congress, [1332]' not the Constitution [Art. III] itself." The questions in Glannon you mention are about the scope of diversity under 1332. So Strawbridge applies.

In contrast, State Farm Fire & Casualty v. Tashire is ultimately about the constitutional scope of diversity under Art. III. The suit in that case was under a different statute (28 USC § 1335) that gave federal jurisdiction to certain cases if only minimal diversity (in which some opposing partioes are diverse) exists. The question was whether 1335 was constitutional . The answer? Yes, because Art. III requires only minimal diversity, even though 1332 requires complete diversity.

7. Question about jurisdiction-stripping statutes,

Q. If Congress were to actually limit SCOTUS's jurisdiction regarding abortion like we talked about in class, couldn't the Court still accept an abortion case and declare the congressional statute limiting abortion jurisdiction unconstitutional?  In class, you suggested that passing such a statute would be a usurpation of judicial power (and I definitely agree), but can't the Court still assert itself, even if doing so is "illegal" under the statute?

A. Yes - the SCt could take an abortion case for the purpose of assessing the constitutionality of the jurisdiction-stripping statute and declare the statute unconstitutional if it thought it was. But under its reading of the exceptions clause it might conclude that it was constitutional and then dismiss the abortion case for lack of jurisdiction.

8. Question about domicile of members of military.

Q. How does diversity jurisdiction apply when considering the domicile of military members stationed throughout the country?  For example, I am (obviously) physically present in Virginia, I own property on which I pay taxes in VA, and my car and dog are both registered in VA.  However, my home of record (residence at the time I joined the military) is in New Hampshire.  I vote in NH, I have a NH driver’s license, and for income tax purposes I am a resident of NH.  My military records also indicate that I am a NH resident.  I am in Virginia for a definite period of time, after which I will move elsewhere, although I do not have a definite intention to return to NH at any specific time (beyond a “floating intention” of maybe moving back there in 15 years or so, similar to the case of Baker v. Keck.).  For purposes of establishing diversity jurisdiction, am I a citizen of NH or of VA? 

A.
Ah yes, each year I get this question. First of all, the general rule is that presence under physical or legal compulsion cannot generate a domicile. This applies to prisoners, members of the military, those who are committed etc. Here is part of section 17 of the Second Restatement on Conflicts on the matter:


A person does not acquire a domicil of choice by his presence in a place under physical or legal compulsion.
a. Rationale. Acquisition of a domicil of choice requires some free exercise of the will on the part of the person involved. An act done by him under physical compulsion or because of criminal or comparable sanctions will be legally ineffective for this purpose... d. Soldiers and sailors. A soldier or sailor, if he is ordered to a station to which he must go and live in quarters assigned to him, will probably not acquire a domicil there though he lives in the assigned quarters with his family. He must obey orders and cannot choose to go elsewhere. On the other hand, if he is allowed to live with his family where he pleases provided it is near enough to his post to enable him to perform his duties, he retains some power of choice over the place of his abode and may acquire a domicil. To do so, however, he must regard the place where he lives as his home. Such an attitude on his part may be difficult to establish in view of the nomadic character of military life and particularly if he intends, upon the termination of his service, to move to some other place.

In short, it is difficult to establish a domicile in Va if you are compelled to be here. Furthermore, the fact that you don't intend to return to NH doesn't mean it isn't your domicile. You retain a NH domicile until you establish a new one. So if you haven't established a Va domicile, you still have a NH one.

On the other hand, it sounds as if your presence here might not be due to physical compulsion. You are not, I assume stationed in Va, but are going to school here. If so, the issue of your domicile would be similar to that of other students. I'll discuss that in class.

9. Question about diversity and Alien Tort Claims Act.

Q. I came to the study session today and hearing you discuss diversity examples reminded me of a few questions I had meant to ask when you initially addressed the topic.

When we discuss the "statutory scope" of diversity jurisdiction, does that term only refer to the scope of § 1332?  Does, for example, the Alien Tort Claims Act modify the statutory scope of diversity jurisdiction?  If so, how is that reconciled with the Constitutional scope of diversity jurisdiction? Are there other statutes that do not fall within the Rules of Civil Procedure but nevertheless provide guidance as to diversity jurisdiction?

These questions may well fall into the realm of information we don't need to consider, or simply information that has been misconstrued and doesn't apply to diversity jurisdiction to begin with.

A. This is one sophisticated question. First of all, the Alien Tort Claims Act provides subject matter jurisdiction in district court for actions “by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” (It was very rarely used in the past, but has recently been rediscovered by plaintiffs.) It is true that this statute lets certain cases into federal court that do not fall under 1332. But I wouldn't describe this as an example of diversity jurisdiction in 1332 being modified by the Act. The Act is not generally used for suits between aliens and citizens of states. Most of the time the Act is used for an alien to sue an alien. For this reason the Act's contitutionality cannot depend upon diversity/alienage jurisdiction in Article III, since alien v. alien suits do not fall under Art III diversity/alienage jurisdiction.

The constitutionality of the Act has been held to depend upon "arising under" jurisdiction in Article III. This is clearly true of a plaintiff who sues under a treaty of the US. But what about the law of nations? One court took the law of nations to be part of federal common law as incorporated into the Constitution at the time of its adoption. See Filartiga v. Pena-Irala, 630 F.2d 876, 885–886 (2d Cir. 1980). So such suits too would fall under arising under jurisdiction in Art III.

By the way, you say "Are there other statutes that do not fall within the Rules of Civil Procedure but nevertheless provide guidance as to diversity jurisdiction?" This is misstated. No statute (not even 1332) falls under the Fed R Civ P. The federal rules are not concerned with subject matter jurisdiction. Your real question is whether there are other statutes besides 1332 that provide guidance as to diversity jurisdiction, that is, statutes (besides 1332), the constitutionality of which depends upon diversity/alienage jurisdiction in Article III. The answer is yes. One example is 28 USC 1335 (statutory interpleader) which I discussed in class. But the Alien Tort Claims Act is not an example.

10. Diversity involving alien corps.

Q. Say there is a foreign corporation which has citizenship in a U.S. state that sues a U.S. corporation (say in california) with principal place of business overseas, how does diversity work? Would I look at the foreign corporation's principle place of business (which is in a U.S. state say California as well)?  If the foreign corporation's principle place of business is in California and the US corporation's principal place of business is overseas (in say France) would the foreign corporation with citizenship in a U.S. state (CA) have diversity under 1332?  

2nd part of the question-would this be unconstitutional under article 3 since technically its a foreign corporation against a foreign corporation, which is not allowed?

A. I touched upon this question briefly in class. Keep in mind that under 1332(c) "a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business..."

Prior to 1332(c)'s enactment corps were treated only as having the citizenship of their state of incorporation. One interpretation of 1332(c) is that it applies only to corporations incorporated in a US state. The argument here is that a 1332(c), by referring to a State (with a capital S) was referring only to corps incorporated in a US state. Only these corps have the citizenship of their US state of incorporation and their PPB. Foreign corps are treated only as citizens of their country of incorporation. So UK corp with its PPB in NY would be only a UK corp. This was the approach taken in Eisenberg v. Commercial Union Assur. Company, 189 F. Supp. 500 (S.D.N.Y. 1960) and some other courts have followed it.

Furthermore, even with respect to corps incorporated in a US state, one looks to their PPB for citizenship only if the PPB is in a US state (since the language about PPB in 1332(c) uses State with a capital S). So a NY corp with PPB in the UK would be only a NY corp.  

So understood, a NY corp with a UK PPB could sue a UK corp with a NY PPB in fed ct, because that would be a case of a NY citizen suing a UK citizen (and so fall under 1332(a)(2)). There is an argument, I suppose, that this is unconstitutional, because this is either an alien v. alien suit or a NYer v. NYer suit (or both) neither of which is allowed under the constitution. But since minimal alienage is allowed under Article III, I would think it is OK. All you need for minimal alienage is a citizen of a state on one side and an alien on the other and we have that here.

Another interpretation would treat 1332(c) as applying to corps incorporated abroad and gives them the citizenship not merely of their country of incorporation but also their PPB, whether that is a country or a US state. (Likewise corps incorporated in a US state are also aliens if they have their PPB abroad.) This approach was taken in Southeast Guaranty Trust Company v. Rodman & Renshaw, Inc., 358 F. Supp. 1001 (N.D. Ill. 1973), and some other courts have followed it too. So understood, a NY corp with a UK PPB could not sue a UK corp with a NY PPB in fed ct, because that would be a case of a NYer and a UK citizen suing a NYer and a UK citizen. That could not fall under any category in 1332(a).

11. Question about limited and special apperanaces.

Q. I have a question about appearance. My question is what is the difference between Limited Appearance and Special Appearance.

To my understanding, the special appearance means D may appear and challenge PJ without submitting himself to PJ by his very presence.

Well, by reading the F&K Page 497-499, I am confused by whether the limited appearance has a similar meaning with the special appearance?

A. Under a special appearance, the defendant may appear for the purpose of challenging the court's PJ over him. His appearance will not itself be taken as consent to PJ (although the court may take any defense on the merits, such as failure to state a claim, to be consent to PJ). In a limited appearance, which occurs in a quasi-in-rem action, the defendant does not appear to challenge PJ. He accepts that the court has PJ, up to the value of the property that is the source of PJ. Instead the defendant appears to argue the case on the merits. But the appearance is limited because the court will not take this appearance itself as consent to in personam PJ (which is not limited by the value of the property).

12. The 100-mile bulge.

Q. I just want to make sure I understand this "bulge state" concept properly.  If a third-party corporation is tagged anywhere within the bulge itself and has sufficient contacts with any state over which that bulge overlaps, there can be PJ under 4(k)(1)(b), at least according to some courts?  I understand the concept of treating the bulge like its own state - if there are sufficient contacts with the bulge itself (and the corp. is tagged within the bulge), there is PJ within the bulge. I can probably illustrate my confusion regarding the bulge state concept through an example.

Let's use the slide from class, showing the 100-mile bulge from the S.D.N.Y.  It slightly overlaps Pennsylvania.  So, let's imagine that the corp.  has extensive contacts with Pittsburgh, well beyond the bounds of the bulge.  Let's say the corp. is tagged in New Hope, PA, which is within the bulge.  It seems there would be PJ over the corp. because it was tagged within the bulge and it has sufficient contacts with the bulge state (in this case, Pennsylvania).  However, if the corp. has extensive contacts with, say, a town in the Southwestern corner of Massachusetts, there would not be PJ, because the bulge does not overlap Mass. at all, even though that town would actually be closer to the S.D.N.Y. than Pittsburgh (let's say that this town is 125 miles away from SDNY, and Pittsburgh is 300 miles away)?

Also, does the corp. have to be tagged in the state in which it has the contacts?  In my example above, the corp. was tagged in New Hope, PA (within the bulge) and had contacts with Pittsburgh, PA.  What if it was tagged in Trenton, NJ, or Greenwich, CT?  Would the contacts in PA still be relevant because the bulge overlaps PA, or does the "bulge state" concept only come into play when the corp. is tagged in that state?

I hope these questions make sense.

A.
Your questions do indeed make sense. For those courts that say the contacts can be with the bulge state, not just the bulge, there would be PJ over the corp as a result of the activities in Pittsburgh and the service in New Hope, as odd as that seems. Other courts require minimum contacts with the bulge itself. As for your second example, in which the service is not in New Hope, but in another state (say NJ) within the bulge, the Pittsburgh, PA contacts would clearly not work, even for those who think that the contacts can be within the bulge state rather than the bulge. Here is a third question: Can the minimum contacts be with a part of the bulge in a state other than the state where the third-party defendant was served? For example, can the contacts be in Newark, NJ (within the bulge), while the service is in Greenwich, Conn. (also within the bulge)? I don't see why not, but after around 45 minutes of searching I was not able to find a case that explicitly states that this is OK.

13.  Domicile of insurance company.

Q. 28 USC 1332 has a clause that states, for purposes of establishing diversity jurisdiction, insurance companies are residents of the same state as the insured.  For your in-class examples 1-6, why isnt the X insurance company considered a domiciliary of NY, and therefore personal jurisdiction established, without having to go through the 100 mile rule, checking minimum contacts with Connecticut, etc.? 

A. First of all, this is what the provision in 1332(c) says: "in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business." A "direct action" is an action where the plaintiff, rather than suing the defendant, simply sues the defendant's insurer, to get the proceeds that the defendant will get from his insurer if the defendant is liable to the plaintiff. Some state law allows direct actions (I know Wisconsin does), other states don't. So the provision simply says that when a plaintiff is suing the insurance co., rather than the insured, in a direct action, one should include as the citizenship of the insurance co. the citizenship of the insured. That makes sense, since the insured is still sort of a defendant in the action, even though the suit is technically against the insurance co. This provision would be irrelevant when the defendant himself brings in his insurer in a third-party complaint. That's not a direct action.

Furthermore, even the provision were applicable, that would only be true for diversity SMJ. That wouldn't make the insurer domiciled in the insured's state for PJ.

14. Challenging state-law venue upon removal.

Q. If an action is brought in state court and venue is improper under that state's laws, can the defendant remove to federal court and still raise the issue of improper venue under state law in that federal court?

A. The general rule is that a defendant does not waive defenses like lack of PJ and improper service by removing (for cases, see 14C Wright & Miller, Federal Practice and Procedure § 3738, footnote 17). But the cases I can find all mention PJ and service. I could not find one mentioning state-law venue. And I don't think it would work. After all, the defendant is now in federal court, where different venue rules apply (and furthermore, as you know, there is always federal venue for the removed action). But I'm not 100% sure of this.

15. Question about venue fallback provision 1391(a)(3).

Q.
A.  This, as it turned out, was a very nice question indeed. I have found one court accepting your argument: U.S. Fidelity and Guar. Co. v. Mayberry, 789 F.Supp. 901 (E.D.Tenn.,1992). To be sure, I have also found a case in which 1391(a)(3) was used when the only source of PJ over a defendant was tagging (which, as you note, technically occurs after commencement). Anchor Glass Container Corp. v. Buschmeier, 426 F.3d 872 (7th Cir. 2005). But the court did not consider your argument.

I also found a court buying your argument in a different context, namely to determine whether a corporation resides in the district for the purposes of 1391(a)(1). The case was Rich Products Corp. v. Floveyor Intern., Ltd., 1995 WL 591134 (W.D.N.Y.). Remember, under 1391(c) a corp resides in a district if it would be subject to PJ in that district at the time the action commenced. The court in Rich Products said the following (in footnote 7): "Thus, assuming that this Court had obtained personal jurisdiction over [the corporate defendant] merely by way of process being served on [its managing director], such did not occur until nearly one month after the action had been commenced. There is no other basis for asserting personal jurisdiction over [the corporate defendant]; thus personal jurisdiction did not exist over it when the action was commenced. [So it does not reside in the district for venue purposes.]” But the very idea that service on the director could establish PJ over the corp is utterly wrong anyway, so it's hard to see how much should be made of this passage.

In the end I think the argument for your reading is strong, for the following two reasons:

1) Venue is supposed to be about convenience, and it is hard to see how a district is convenient simply because a defendant was tagged there. It seems to be better if at least one defendant is subject to PJ in the district for a reason besides tagging (such as domicile).

2) Your interpretation would explain away the following puzzle about 1391(a)(3): Given that, in the end, there must by PJ over all the defendants, what good is 1391(a)(3)? To be sure, if 1391(a)(3) is satisfied, we know that there is venue in the district, but if there is no PJ over all the defendants the action will not be able to proceed anyway. Some of the defendants will have to be dropped. And if they are dropped, it may be the case that 1391(a)(3) isn’t needed anymore, since there will be a district that has venue under 1391(a)(1).

Now it is true that there could be PJ over all the defendants in a state even if there is not PJ over all the defendants in the district of that state where the action is brought. If so, the action would be able to proceed. PJ in the state is what matters for FRCP 4(k)(1)(A) and one defendant being subject to PJ in the district would be enough for venue. But this is a really narrow situation. Your reading makes 1391(a)(3) more useful. There may be PJ over all the defendants through tagging, but the venue requirement of 1391(a)(3) is more stringent. With respect to one defendant there must be PJ at commencement (that is, not through tagging).

A great question.

16. Aliens and venue.

Q. An alien may be sued in any district (for venue). What about illegal aliens? like for example an illegal alien domiciled in California for 12 years, or a German admitted for permanent residency in NY, or a Chinesewoman with pending green card in Wisconsin?

A. Aliens for the purposes of venue includes aliens residing in US (legally or illegally). (Notice the difference with diversity, where an alien admitted for residency and domiciled in a state is considered a citizen of that state.) Also concerning alien corporations, an alien corporation is an alien for venue purposes. And that includes a foreign corp with its principal place of business in the US.  Mizrahi v. Great-West Life Assur. Co., No. Civ. A. 99-819, 1999 WL 398714 at *1 (E.D. Pa. June 17, 1999). I could not find anything about whether a US corp with its principal place of business abroad is also an alien for venue purposes...

17. Question about service.

Q. P files a complaint and serves D immediately but service is improper. D makes a motion to dismiss for improper service. Even though it's still within the 120 days P has to effectuate proper service, why is the motion granted and the action dismissed? I understand that from D's perspective, he would just want the action dismissed. But shouldn't the Court give P another chance to properly serve D since the time to serve had not yet expired? I would have thought that P can "fix" service problems at any time up until the 120 days expires.

A. It is true that the defendant would want the plaintiff's action to be dismissed. Indeed it makes no sense for him to want to have P serve again in accordance with R 4. Since the defendant can waive service as a defense anyway, and must have gotten notice (or he would not know to object to the service), what good would having the plaintiff serve again properly do?