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GREEN v. WILLIAM MASON & CO.

March 5, 1998

John G. Green, et al., Plaintiffs,
v.
William Mason & Co., et al., Defendants.



The opinion of the court was delivered by: WALLS

 Walls, District Judge

 This matter comes before the Court upon defendant Imperial Bank's motion to dismiss the complaint for lack of personal jurisdiction pursuant to Fed. R. Civ. P. 12(b)(2) and for failure to state a claim for which relief can be granted under Fed. R. Civ. P. 12(b)(6). Pursuant to Rule 78 of the Federal Rules of Civil Procedure, the Court decides this motion without oral argument. For the reasons that follow, defendant's motion is granted.

 Background

 Plaintiffs in this action are the Trustees of Elevator Constructors Union Local No. 1 Annuity and 401(k) Fund and the Fund itself. The complaint alleges that the investment advisor defendants William Mason & Co ("WMC"), William F. Mason ("Mason"), et al., invested assets of the fund in speculative derivative securities in violation of, inter alia, those defendants' fiduciary duties under §§ 404(a)(1) and 405(a)(1) of the Employee Retirement Income Security Act, ("ERISA"), 29 U.S.C. §§ 1104(a)(1)(B), (C), (D), §§ 1105(a)(1), (2), (3). Defendant Imperial Bank ("Imperial") is included in this action because, according to plaintiff, "at all times through April, 1993, Imperial employed Mason, owned and operated WMC, had the authority through its employment of Mason to control WMC's general operations, and is thus liable for the actions of Mason and WMC." Compl. at P 14. On the basis of this relationship, the complaint asserts that "Imperial was, through April 1993, a fiduciary with respect to the Fund within the meaning of § 3(21) of ERISA, 29 U.S.C. 1002(21)."

 Imperial first moves to dismiss the complaint on the ground that the Court lacks personal jurisdiction over it. Imperial is a California banking corporation with its principal place of business in Inglewood, California. It asserts that it has no contacts whatsoever with the State of New Jersey and that it would therefore be a violation of due process for the Court to assert personal jurisdiction over it in this case. Imperial also asserts that the complaint fails to state a claim upon which relief can be granted because (1) the allegations regarding Imperial's fiduciary status are insufficient as a matter of law to support any ERISA claim; (2) the allegations are similarly defective with regard to the state law claims; and (3) the state law claims are all preempted by ERISA.

 Discussion

 I. Personal Jurisdiction

 Rule 4(e) of the Federal Rules of Civil Procedure provides that service of process upon a defendant is made "pursuant to the law of the state in which the district court is located [ . . . ] unless otherwise provided by federal law." Fed.R.Civ.P. 4(e)(1). ERISA contains such jurisdictional provisions and, in the context of a breach of fiduciary duty claim, provides that an action:

 
may be brought in the district where the plan is administered, where the breach took place, or where a defendant resides or may be found, and process may be served in any other district court where a defendant resides or may be found.

 29 U.S.C. § 1132(e)(2) (emphasis added).

 Because this section explicitly provides for nationwide service of process, the Court's exercise of personal jurisdiction in an ERISA matter is not constrained by the familiar "minimum contacts" analysis established by International Shoe Co. v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945). Instead, the prevailing view in this and other circuits is that an assessment of personal jurisdiction under such a statutory provision necessitates an inquiry into the defendant's contacts with the national forum. See e.g., AlliedSignal v. Blue Cross of California, 924 F. Supp. 34, 36 (D.N.J. 1996) (citing cases). As the Third Circuit has explained, "the hallmark of [a national contacts] theory is that it is not the territory in which a court sits that determines the extent of its jurisdiction, but rather the geographical limits of the unit of government of which the court is a part." Max Daetwyler Corp. v. Meyer, 762 F.2d 290, 293-94 (3d Cir. 1985).

 While the Supreme Court has never addressed the constitutionality of an exercise of personal jurisdiction based on national contacts, "all the courts of appeals that have addressed the question have applied a national contacts standard when process is served under an applicable federal service provision." 4 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1067.1 at 311 (2d ed. 1987). Imperial protests that a national contacts inquiry, without more, is insufficient to satisfy the due process requirements of the fifth amendment. It argues that its contacts with New Jersey must be considered, "if not as the sole test [of due process] than at least as one of several factors." Pl. Br. at 12. The Court does not agree.

 At least one of the purposes of the International Shoe minimum contacts analysis is to constrain the state courts from reaching beyond the "limits imposed on them by their status as coequal sovereigns in a federal system." World Wide Volkswagen v. Woodson, 444 U.S. 286, 291-92, 62 L. Ed. 2d 490, 100 S. Ct. 559. Thus, it is indisputable that "those strictures of fourteenth amendment due process analysis which attempt to prevent encroachment by one state upon the sovereignty of another do not apply with equal force to the adjudication of a federal claim in federal court." Max Daetwyler, 762 F.2d at 294. As the Third Circuit has instructed, the only limitation on Congress' power to empower a plaintiff to sue in his home district is "whatever fairness to the defendant is required by fifth amendment due process." Horne v. Adolph Coors Co, 684 F.2d 255 (3d Cir. 1982). The ...


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