Case of the Day: SiOnyx v. Hamamatsu Photonics

The case of the day is SiOnyx LLC v. Hamamatsu Photonics K.K. (D. Mass. 2016). SiOnyx and the President and Fellows of Harvard College brought an action against Hamamatsu Photonics, a Japanese corporation, and its American subsidiary, Hamamatsu Corp., and others. The plaintiffs effected service on Hamamatsu Corp., but they conceded that they had not directly effected service on Hamamatsu Photonics. Instead, they asserted that service on the subsidiary was effective as service on the parent, because the subsidiary was the parent’s “managing or general agent,” and thus the service was effective under Mass. R. Civ. P. 4(d)(2). It’s unclear to me, by the way, why the parties focused on Mass. R. Civ. P. 4 instead of Fed. R. Civ. P. 4(h)(1)(B), which also has a managing or general agent provision. The Massachusetts rule is incorporated by reference into the federal only if the service is to be made in the United States; but if the service is to be made in the United States, why not rely instead, or in addition, in the federal rule for domestic service? Perhaps there is some difference in how the federal cases and the Massachusetts cases define a managing or general agent, but if so, I don’t know offhand what it is. In any event, the plaintiffs also sought a preliminary injunction against the Japanese defendant.

Judge Saylor held that the service was ineffective on the Japanese firm, because the US subsidiary was not its managing or general agent. The court, correctly I think, held that a parent/subsidiary relationship, without more, is not enough. The issue is fact-specific. Nor would the court appoint the subsidiary as an involuntary agent for service of process.

The main point of interest is the Court’s decision that in light of the failure to serve process, it lacked personal jurisdiction over the Japanese firm and thus lacked the power to issue and injunction, even preliminarily. I’ve addressed this issue several times before, perhaps most recently in a 2014 post; you can follow the links in that post back to prior coverage.

My basic view is that as long as the defendant to be enjoined has received constitutionally sufficient notice and an opportunity to be heard, an insufficiency in service of process should not stand in the way of a preliminary injunction. It seems to me that this follows from the law governing temporary restraining orders. Everyone agrees that in appropriate cases courts have the power to issue TROs without notice, and a fortiori before service of process. So there seems to me to be no issue about a court’s power to grant preliminary relief before service of process.

If I can say something a little broader about cases like this, I think that the black-letter rule that service of process is necessary for personal jurisdiction doesn’t serve a good purpose today if it ever did, and I speculate that it’s based on some potted legal history.

Today, service of process serves the function of notice. Personal jurisdiction serves two purposes: first, making sure that courts do not overstep the territorial sovereignty of the state (and by the same token, making sure that courts have the power to adjudicate cases against everyone within their territorial jurisdiction—the so-called “tag service” that is still orthodox in the United States at least); and second, making sure that that it’s basically fair to hale the defendant into court in a particular forum. Why would someone think that service of process should be linked with the question of the court’s power to hear a case? I suspect it’s because someone once learned that in the olden days the common law courts would not proceed until a defendant had appeared in court but would instead keep issuing increasingly painful writs—attachment, distraint, arrest, etc.—until the defendant “voluntarily” appeared, and after the early period, “process” often meant arrest even in routine civil cases. (If you’re interested in this and don’t want to read Pollock & Maitland or other heavy-duty historical accounts, check out Nathan Levy, Mesne Process In Personal Actions At Common Law And The Power Doctrine, 78 Yale L.J. 52 (1968), and Albert Ehrenzweig, The Transient Rule of Personal Jurisdiction: The “Power” Myth and Forum Conveniens, 65 Yale L.J. 289 (1956)).

But once we note that process no longer relies on a court’s physical power, as anyone who reads the many cases on service abroad knows, I think it’s just anachronistic to say that the delivery of a piece of paper to the defendant by a particular method is necessary to the court’s power over that person, as long as the substantive requirements of our personal jursidiction doctrines are satisfied. Now, I’m not advocating a change or relaxation in our rules of service—indeed, I think that sometimes our rules are too relaxed insofar as they permit methods of service (e.g., service at a last and usual place of abode, or service by email, or whatever) that don’t really provide much certainty that the defendant has received notice. But in cases where a plainitff claims a risk of imminent and irreparable harm, I think decisions like SiOnyx get it wrong.

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2d ed. 2016), a nuts-and-bolts guide to international judicial assistance issues, and of the chapter on service of process in the ABA's forthcoming treatise on International Aspects of US Litigation, and he is the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012, 2014, and 2015.

Leave a Reply

Your email address will not be published. Required fields are marked *