PAGEMETAPR10 qx b 4 L d | ( 0 < D M Y0 aH i` qx @ v m D 22fdt UNITED STATES DISTRICT COURT t WESTERN DISTRICT OF TEXASd x tSEPI9 ~ 20P~I 91 dt AUSTIN DIVISION m F $$ 1 ; d x tx tt_ yx t. i C - dtSTEVE JACKSON GAMES INCORPORATEDx t)x tx t?~E~wIwlTY m lSTEVE JACKSON, ELIZABETH m D 22ftMcCOY, WALTER MILLIKEN, and tSTEFFAN O'SULLIVAN, m > $$t Plaintiffs,x t) Docket No. A 91 CA 346 m pd v. m pdUNITED STATES SECRET SERVICE, UNITED STATES OF AMERICA, WILLIAM J. COOK, TIMOTHY M. FOLEY, BARBARA GOLDEN, and HENRY M. KLUEPFEL, m pDefendants. lPLAINTIFFS' RESPONSE AND MEMORANDUM IN OPPOSITION TO uINDIVIDUAL uDEFENDANTS' uMOTION uTO uDISMISS bINTRODUCTION Plaintiffs?wl submit this response and memorandum of law in 4 opposition to the individual defendants'd ?w2 dmotion to dismiss the claims against them for lack of personal jurisdiction. The plaintiffs allege that the individual defendants, acting as federal officials under color of m p?w1 Plaintiffs are Steve Jackson Games (SJG), an award- winning publisher of books, magazines and games in Austin, Texas; its owner and Austin resident Steve Jackson; and three user~ of an electronic bulletin board system operated in Austin by SJG. m pd 2 dThe individual defendants, all of whom acted as federal officers under color of federal law, are William J. Cook, an Assistant United States Attorney; Secret Service Agents Timothy M. Foley and Barbara Golden; and Henry M. Kluepfel. z ;ys; ~ 011 | >11 | X !v m pdfederal law, planned and executed a search of Steve Jackson Games in Austin, Texas, and the seizure of property, publications, and private communications therefrom, in violation of plaintiffs' rights under the First and Fourth Amendments and the Electronic Communication Privacy Act, 18 U.S.C. 2510 et seq & 2701 et seq.3 Defendants cannot seriously dispute that their contacts with this forum giving rise to this lawsuit -- which include investigating Austin residents, preparing and filing a search warrant application uwith uthis uCourt, and planning and executing the search and seizure at SJG in Austin -- were substantial and deliberate. Rather, they claim that personal jurisdiction over them is lacking because they acted within the scope of their employment. Defendants' arguments, which they base on the fiduciary shield doctrine and the Supremacy Clause, are incorrect and should be denied. m pI. DEFENDANTS' ~UBSTANTIAL AND DELIBERATE CONTACTS WITH THIS FORVM JU L !STIFY THE EXERCIBE OF PERBONAL JURI~DICTION OVER THEM. m pJurisdiction over nonresident defendants is permissible lin a federal question case if defendants are amenable to service under Federal Rule of Civil Procedure 4(e) and if the m pexercise of jurisdiction over them comports with Due Process. m pd 3 dPlaintiffs have also asserted claims against the government, including a claim that defendants' conduct violated the Privacy Protection Act of 1980, 42 U.S.C. 2000aa uet useq. z 8 0 0 p v m ld-3 - Omni Capital Intern. v. Rudolf Wolff & Co. Ltd., 484 U.S. 97 (1987). Since Rule 4(e) incorporates the long arm statute of the forum state, and since the Texas blong arm statute, which has been interpreted to reach the limits of Due Process, jurisdiction over the defendants is appropriate if it is constitutionally permissible. uStuart uv. uSpademan, 722 F.2d 1185, 1189 (5th Cir. 1985) (uciting uHall uv. uHelicopteros uNacionales ude uColombia, 638 S.W. 2d 870, 872 (Tex.1982), m purev'd uon uother ugrounds, 466 U.S. 408 (1984)). m pThe Due Process clause permits the exercise of specific ljurisdiction over out-of-state defendants if they have "'purposefully directed' [their] activities at residents of the forum, ... and the litigation results from the alleged m pinjuries that 'arise out of or relate to' those activities." luBuraer uKing uCorp. uv d . uRudzewic, 471 U.S. 462, 472 (1985) (uquoting uHanson uv. uDenckla, 357 U.S. 235, 253 (1958)).4 Defendants who engage in "intentional, and allegedly tortious, actions .. . expressly aimed at" the forum thereby subject themselves to its jurisdiction. uCalder uv. uJones, 465 m p~ In contrast to "general jurisdiction," which requires continuous and systematic contacts with the forum state, specific jurisdiction "may arise without the nonresident defendant's ever stepping foot upon the forum state's soil or may arise incident to the commission of a single act directed at the forum". uBullion uv. uGillespie, 895 F.2d 213, 216 (5th Cir. 1990). "Specific jurisdiction is proper even if a defendant has only minimal contact with the forum State, provided a nexus exists between the defendant's contacts, the forum, and the litigation." uStuart uv. uSpademan, 772 F.2d 1185, 1189-90 (4th Cir. 1985). z Qv m ld-4 - U.S. 783, 789-790 (1984); uAsahi uMetal uInd. uv. uSuperior uCourt uof uCalifornia, 480 U.S. 102, 112 (1987). The exercise of specific jurisdiction is proper if "the defendant~s'] conduct and connection with the forum State are such that [they~ m pshould reasonably anticipate being haled into court there." luWorld-Wide uVolkswagen uCorp. uv. uWoodson, 444 U.S. 286, 297 m p( 19 8 0 ) . m pDefendants' claim that their contacts with this forum lare insufficient to invoke the jurisdiction of this Court is without merit.?wS Defendants invoked the jurisdiction of this Court when they submitted a warrant application to uthis uCourt seekinq authorization to conduct a series of three searches and seizures, including the search and seizure at SJG, in Austin.d 6 m pd5 To defeat defendants' motion to dismiss, plaintiffs need only demonstrate a upri $ | Qma ufacie case of personal jurisdiction. Moreover, all uncontroverted allegations in the complaint must be taken as true, and any conflicts between the parties' affidavits must be resolved in plaintiffs' favor. uBullion uv. uGillespie, 895 F.2d 213, 217 (5th Cir. 1990). m pd 6 dThe warrant application and supporting affidavit seeking this Court's authorization to search the Austin office of SJG and the Austin residences of Loyd Blankenship and Chris Goggans is attached to the Complaint as Exhibit A. The warrant affidavit, which was drafted by defendants Cook and Foley, and was submitted to this Court by defendant Foley, asserts that it is based on Foley's own investigation, as well as on information and investigation provided by Defendants Golden and Kluepfel. Declarations of Timothy M. Foley and William Cook, Attached as Exhibits A~B to United States Motion to Dismiss or in the Alternative for Summary Judgment. Defendants' inventory of items seized was submitted to thi Qs Court by defendant Golden and is attached to the Complaint as Exhibit B. z 0 `0xx x , v m ld-5- m pDefendants were the "primary participants" in the m punlawful search and seizure at SJG in Austin. uCalder uv. luJones, 465 U.S. at 789-90. All of the defendants participated in this Austin-focussed investigation,' and all have admitted having substantial contact with this forum for the purpose of executing the search of SJG and the seizure and retention of materials therefrom. Defendants Foley, Golden, and Kluepfel have even admitted that they were physically present during the execution of the search warrant at SJG.~ Their contacts with this forum in the course of planning and executing the search and seizure were purposefully directed at residents of this forum, where the impact of their activities would obviously be felt. Id.; m pd 7 dThe warrant affidavit drafted by Cook and Foley states that it is based on Foley's investigation, on "information" provided by defendant Golden, and on "technical information and i ( nvestigative assistance" from defendant Kluepfel. Warrant Affidavit at paras. 2 ~ 3. The warrant affidavit reveals that, as part of his investigation of Austin residents, defendant Kluepfel accessed at least two electronic bulletin board services connected to Austin telephone numbers run from computers systems in Austin, including the electronic bulletin board run by SJG. Warrant Affidavit at paras. 24, 35. m p~ Declarations of Timothy M. Foley, Henry M. Kluepfel, and Barbara Golden, Attached as Exhibits A, C, and D to Motion to Dismiss of Individual Defendants. Defendant Foley further admits to meeting with Steve Jackson in the Austin Field Office of the Secret Service the day after the search and seizure, at which time the Secret Service refused to return any of the seized equipment and most of the seized data to Jackson. Declaration of Timothy M. Foley, Attached as Exhibit B to United States Motion to Dismiss or in the Alternative for Summary Judgment; Complaint at paras. 53-55. z 4 v m lduAsahi uMetal uInd. uv. uSuperior uCourt uof uCalifornia, 480 U.S. at 112; uBurger uKing uCorp. uv. uRudzewic, 471 U.S. 462, 472 ( 19 8 5 ) . d 9 dMoreover, in planning and executing the search and seizure at SJG, the defendants utilized the resources of this Court, of the University of Texas, and of local law enforcement officers, thereby availing themselves of the m pprivileges and protections of this Texas forum.?wl uHanson uv. m pd 9 dDefendant Cook's assertion that he was not present in Texas during the events giving rise to this lawsuit does not undermine this Court's jurisdiction over him. Cook oversaw the investigation, drafted the warrant affidavit, negotiated the return of the property by telephone with Mr. Jackson, who was in Texas, and caused a subpoena to be served on the University of Texas. Complaint at paras. 20, 56; Warrant Affidavit at para.37; Declaration o 8 0 f William J. Cook, Attached as Exhibit A in support of the United States Motion to Dismiss or in the Alternative for Summary Judgment. m x pWhere as here, a defendant's conduct giving rise to a lawsuit was "'purposefully directed' towards residents of another State," the Supreme Court has "consistently rejected the notion that an absence of physical contacts can defeat personal jurisdiction there." uBurger uKing, 471 U.S. at 476 (citing cases); uCalder uv. uJones, 465 U.S. at 789 (affirming jurisdiction over Florida-based defendants in California "based on the 'effects' of their Florida conduct in California"); uPrejean uv. uSonatrach, uInc. 652 F.2d 1260 (5th Cir. 1981). Indeed, in this age of electronic communications, it is easier than ever to direct events in a jurisdiction without ever setting foot within its geographic boundaries. m p?w1w0 The warrant affidavit states that defendant Foley obtained investigative assistance from Larry 4 Coutourie, "an inspector with campus security at the University of Texas in Austin, Texas," who allegedly provided Foley with Texas drivers license information concerning the Austin residents Loyd Blankenship and Chris Goggans from his review of "locator information at the University of Texas." Warrant Affidavit at paras. 33 & 36. Pursuant to a grand jury subpoena which defendant Cook caused to be issued on the University of Texas, defendant Foley received additional z ߿?8 y?y ߿~ x 77 ͬ$ـ<͘3 N&# $ǀ < O # |! | M# !, ~7 ;7 @ v m ld-7 - m puDenckla, 357 U.S. 235, 253 (1958); uGrowden uv. uEd uBowlin uand Associates. Inc., 733 F.2d 1149, 1151 (Sth Cir. 1984). m x pThere is no question that the defendants expected to return to this Court in connection with their Austin investigation. uWorld-Wide uVolkswagen uCorp. uv. uWoodson, 444 U.S. 286, 297 (1980). The fact that they undoubtedly intended to prosecute the targets of their investigation, rather than defend their unlawful search and seizure in this lawsuit, does not deprive this Court of jurisdiction over them. lII. PERSONAL JURISDICTION OVER THE INDIVIDUAL DEFENDANTS m x pIS NOT PROHIBITED BY THE "FIDUCIARY ~HIELD DOCTRINE." m pDefendants' argument that they are shielded from suit in lthis ~urisdiction based on contacts undertaken in the scope m pof their employment fails for two reasons. m pFirst, the argument was expressly rejected b < y the United m pStates Supreme Court in uCalder uv. uJones, 465 U.S. 783 (1984). lIn uCalder, actress Shirley Jones filed suit for damages in California against the Florida-based writer and editor of an allegedly libelous article about her that was published in the uNational uEnquirer. The writer and editor moved to dismiss for lack of personal ~urisdiction, arguing that they m pinformation about Austin resident and University of Texas student Chris Goggans from Margaret Knox, Assistant Director of the Computation Center at the University of Texas. uId at para. 37. Moreover, defendants enlisted the assistance of local law enforcement officers in executing the searches and seizures in Austin. Complaint at para. 42. z ߳ ?v~ow; x f&3 I v m pdacted within the scope of their employment and had no direct economic stake in their employer's sales in a distant State. 465 at 789. The Supreme Court rejected their argument, reasoning that defendants' "status as employees does not somehow insulate them from jurisdiction." 465 U.S. at 790. The Court held that jurisdiction was proper because defendants were "primary participants in an alleged wrongdoing intentionally directed at a California resident." 465 U.S. at 790. The Court emphasized that defendants "expressly aimed" their Florida conduct at California and knew that the "impact" of their actions would be felt in California. 465 U.S. at 789-790. m x pHere, as in uCalder, defendants' conduct giving rise to this lawsuit was deliberately aimed at residents of this forum. Defendants knew that the impact of the search and seizure they planned and executed would be felt here. The basis for personal jurisdiction in this case is even stronger than in uCalder because, whi D le the activity giving rise to the lawsuit in uCalder did not occur in the forum of the lawsuit, defendants in this case had substantial contact with this forum in planning and executing the search and seizure and delibera~ely invoked the jurisdiction of this Court. m x pDefendant's reliance on uStuart uv. uSpademan, 772 F.2d at 1189, is misplaced, for in that case the Fifth Circuit similarly based its personal jurisdiction ruling on the defendant's contacts with the forum undertaken in the scope z Q ?v m ldof his employment. 772 F.2d at 1192-1194. The Court interpreted the fiduciary shield doctrine narrowly to hold only that personal ~urisdiction over the defendant cannot be based on contacts established by uother employees of the m pcorporation. 772 F.2d at 1197 & n.ll. luSaktides uv. uCooper, 742 F. Supp. 382 (W.D. Tex. 1990), on which defendants also rely, is clearly distinguishable by its facts. In contrast to the defendants in this case -- federal officials whose conduct giving rise to this lawsuit was deliberately directed at this forum -- the defendant in uSaktides had no contact with Texas in relation to the litigation other than handling the funds of a Texas corporation. Therefore, the court correctly ruled that the Due Process Clause prohibited the exercise of personal jurisdiction over him. The court's discussion of the fiduciary shield doctrine was unnecessary udicta which should not be extended to this ?case.wlw U$ M ?l m p?wlwl Application of the udicta in the uSaktides opinion to the facts of uthis case would conflict with the Supreme Court's decision in uCalder uv. uJones, 465 U.S. 783 (1984). This udicta also conflicts with decisions of Courts of Appeals holding that the fiduciary shield doctrine is "not a constitutional principle, but is rather a doctrine based on judicial inference as to the intended scope of the long arm statute," and is therefore inapplicable where, as in Texas, the forum state's long-arm statute is co-extensive with the full reach of the Due Process clause. uPittsburg uTerminal Corp v. Mid Allegheny Corp., 831 F.2d 522, 525 (4th Cir. 1987); uColumbia uBriargate uCo. uv. uFirst uNational uBank, 713 F.2d 1052 (4th Cir. 1983) ucert. udenied usub unom, uPearson uv. uColumbia uBriargate uCo., 465 U.S. 1007 (1984); uMarine uMidland uBank. uN.A. Q ?uv. uMiller, 664 F.2d 899, 903 (2d Cir. 1981). zx i` V ]< v m ld -10- m pdSecond, the fiduciary shield doctrine, as interpreted by ldefendants, does not apply to federal officials who are sued for their activities under color of federal law.d 12 dThe Supreme Court has made clear that the conduct of federal officials committing constitutional torts under color of federal authority is attributed to them in their upersonal capacities. uBivens uv. uSix uUnknown uNamed uAgents uof uthe m puFederal uBureau uof uNarcotics, 403 U.S. 388 (1971). lDefendants' argument, if it were accepted, would eliminate specific jurisdiction over out-of-state federal officials for constitutional torts committed against residents of the forum, thereby thwarting "plaintiff[s'] interest in obtaining relief," the States' interest in protecting their citizens from unconstitutional exercises of federal power, "the interstate judicial systems's interest in obtaining effi Y0 cient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social m pd 12 dThe complaint alleges, and its uncontroverted facts demonstrate, that all of the defendants, including defendant Kluepfel, acted as federal officials under color of federal law. Complaint at paras 20, 22-23, 84, 92, 99, 109, 199. Kluepfel's status as a federal official is amply demonstrated not only by his investigative activities giving rise to this lawsuit as recounted in the Warrant Affidavit at paras. 3b, 24-28, 31-32, and 35, but also by the fact that he is represented before this Court by the Justice Department. uSee, ue.g., uSchowengerdt uv. uGeneral uDynamics uCorp, 823, F.2d 1328 (9th Cir. 1987) (security investigator for private company who participated with federal defendants in search was federal actor acting under color of federal law for purposes of uBivens liability). z b&m v c eT v m pdpolicies." uWorld uWide uVolkswagen uCorp. uv. uWoodson, 444 U.S. 286, 292 (1980). It is therefore not surprising that defendants have not cited a single case to support their assertion that federal courts lack jurisdiction over federal officials for constitutional torts committed under color of federal law within their districts. Defendants' Memorandum at 4 n.2. lIII. PERSONAL JURISDICTION OVER THE INDIVIDUAL DEFENDANTS I8 NOT PROHIBITED BY THE ~UPREMACY CLAUSE m pDefendants' claim that this ufederal Court's exercise of ljurisdiction over them would be an unconstitutional exercise of ustate power d i8 dfrivolous. No supremacy issue is raised where, as here, federal officials acting under color of federal law are sued under federal causes of action in federal court. The defendants' claim that the State of Texas has unconstitutionally conditioned their activities within its borders on being subject to suit in Texas m aH isses the mark, because in a federal question case, personal jurisdiction over the defendant is determined by federal, not state, law.d 13 m p13 dIn a federal question case where there is no statutory provision for service of process, the state long arm provision is incorporated by Federal Rule of Civil Procedure 4(e). uOmni uCapital uIntern. uv. uRudolf uWolff u~ uCo. Ltd., 484 U.S. 97 (1987). Defendants' argument is particularly odd in light of their recognition that the Texas long arm statute has been interpreted to be co-extensive with the federal Due Process standard. z ml }v m ld-12- m pThe Supremacy Clause cases cited by the defendants are linapposite because they all involve attempts to sue or prosecute federal officials or agencies in state court under state law.d 14 dThe remaining cases cited by defendant are all cases interpreting the long arm statutes of jurisdictions other than Texas and do not support defendants' claim that a federal court lacks personal jurisdiction over out-of-state government officials engaged in unlawful searches and seizures within its ?district.wlws m pd 14 d uM'Culloch uv. uMaryland, 17 U.S. (4 Wheat.) 316, 432 (1819) (Bank of the United States immune from state taxation); uIn ure u~eagle, 135 U.S. 1 (1890) (federal official immune from state prosecution); uMartin uMalhoyt, 830 F.2d 237 (D.C. Cir. 1987) (federal officers immune from state law tort actions); uCalifornia uv. uWalters, 751 F.2d 977 (9th Cir. 1984) (sovereign immun i` }ity bars state prosecution of Veterans' Administration and its Administrator). m p?w1w5 uGlaros uv. uPerse, 628 F.2d 679, 681-82 (lst Cir. 1980) (jurisdiction was lacking over out-of-state defendants because plaintiff had failed to allege that defendants engaged in conduct covered by the state's long arm statute); uGreen uv. uMcCall, 710 F.2d 29, 32-34 (2d Cir. 1983) (personal jurisdiction over defendant could not be based on a state long arm provision conferring jurisdiction over an out-of- state defendant who commits a tortious act within the forum state through an agent because the agent was an agent of the government rather than of the defendant); uGrove uPress. uInc. uv. uAngleton, 649 F.2d 121 (2d Cir. 1981) (same); uMarsh uv. uKitchen, 480 F.2d 1270, 1272-73 (2d Cir. 1973) (same). z bv m ld-13- CONCLUSION m x pFor the reasons stated above, the individual defendants' motion to dismiss for lack of personal jurisdiction should be denied. m pRespectfully submitted by their attorneys, ld J?wh~v~ ~c~ dSharon L. Beckman (BBO #552077) Andrew Good (BBO #201240) Harvey Silverglate (BBO #462640) Silverglate & Good 89 Broad St., 14th Floor Boston, MA 02110 (617) 542-6663 m p6( ~ ric M. Lieberman Nicholas E. Poser Rabinowitz, Boudin, Standard, Krinsky & Lieberman, P.C. 740 Broadway, at Astor Place New York, NY 10003-9518 (212) 254-1111 ld ~?wb1 ?wb1 ~ dR. James George, Jr. (~07800011) Peter D. Kennedy (#112~650) Graves, Dougherty, ~earon & Moody 2300 NCNB Tower 515 Congress Avenue Austin, TX 78701 (512) 480-5600 DATED: September 18, 1991 z 0 `0 ` 0 >8 0
