439 U.S. 1034 (1978)

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U.S. Supreme Court

LEE HY PAVING CORP. v. O'CONNOR , 439 U.S. 1034 (1978)

439 U.S. 1034

LEE-HY PAVING CORP. and Davis E. Clem
Marguerite T. O'CONNOR, etc
No. 78- 410

Supreme Court of the United States

December 4, 1978

Leave to File Petition for Rehearing Denied April 16, 1979.

See 441 U.S. 918.

On petition for writ of certiorari to the United States Court of Appeals for the Second Circuit.

The petition for a writ of certiorari is denied.

Mr. Justice POWELL, with whom Mr. Justice BLACKMUN joins, dissenting.

This case presents the question whether the Due Process Clause permits a tort plaintiff to obtain jurisdiction in New York over a defendant whose sole contact with the State arises from the defendant's contract for indemnity with a company that does business in New York. [Footnote 1] The case presents an issue of considerable importance, with troublesome ramifications in the spacious arena of personal injury litigation. Moreover, it seems to me that the rationale of our recent decision in Shaffer v. Heitner, 433 U.S. 186 (1977), is at odds with the decision of the Court of Appeals here. I therefore would grant certiorari and set the case for argument.

Page 439 U.S. 1034 , 1035

The petitioners are residents of Virginia. While working for petitioner Lee-Hy Paving Corp. (Lee-Hy) in Virginia, the respondent's decedent (a New York resident) was killed when Lee-Hy's grader, operated by petitioner Clem, struck him near Richmond, Va. The respondent instituted this suit in the District Court for the Eastern District of New York as executrix for her husband's estate, claiming damages for the wrongful death of her husband. In order to obtain jurisdiction over the petitioners, who are conceded to have no other connection with New York, the respondent sought and obtained under New York law an order attaching the contractual obligations of two insurance companies doing business in New York to defend and indemnify Lee-Hy. The District Court denied petitioners' motion to vacate the attachment and dismiss the suit. Acknowledging that there was a "substantial ground for difference of opinion" on the question of law, and that the issue was an important one, the District Court certified an appeal to the Court of Appeals under 28 U. S.C. 1292(b).

The Second Circuit affirmed. 579 F.2d 194 (1978). The court based its ruling on the theory of quasi in rem jurisdiction adopted by the New York Court of Appeals in Seider v. Roth, 17 N.Y.2d 111, 269 N.Y.S.2d 99, 216 N.E.2d 312 (1966). In Seider, personal jurisdiction was predicated on the fiction that the insurance company's obligation to indemnify the policyholder was a "debt" that the plaintiff in a negligence suit could attach as a "res." In Minichiello v. Rosenberg, 410 F.2d 106 (1968), the Second Circuit affirmed the constitutionality of Seider jurisdiction, reasoning that the New York Court of Appeals had created judicially a direct-action law similar to the Louisiana statute held constitutional in Watson v. Employers Liability Assurance Corp., 348 U.S. 66 (1954). The Minichiello court recognized that the Seider doctrine differed in one important respect from the Louisiana direct- action statute of Watson. Under Seider, there was no requirement that the tort for [439 U.S. 1034 , 1036]

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