SCT Resolves Split Re Whether a District Court Must First Establish Its Own Jurisdiction Before Dismissing a Suit on Forum Non Conveniens Grouds

Per Sinochem Intern. Co. Ltd. v. Malaysia Intern. Shipping Corp., 127 S. Ct. 1185 (March 5, 2007) (Ginsburg, J., for a unanimous Court):

The underlying controversy concerns alleged misrepresentations by a Chinese corporation to a Chinese admiralty court resulting in the arrest of a Malaysian vessel in China. . . .

. . .

The District Court [Eastern District of Pennsylvania] first determined that it had subject-matter jurisdiction under 28 U.S.C. § 1333(1) (admiralty or maritime jurisdiction). The court next concluded that it lacked personal jurisdiction over Sinochem under Pennsylvania's long-arm statute, 42 Pa. Cons.Stat. § 5301 et seq. (2002). Nevertheless, the court conjectured, limited discovery might reveal that Sinochem's national contacts sufficed to establish personal jurisdiction under Federal Rule of Civil Procedure 4(k)(2). The court did not permit such discovery, however, because it determined that the case could be adjudicated adequately and more conveniently in the Chinese courts. No significant interests of the United States were involved, the court observed, and while the cargo had been loaded in Philadelphia, the nub of the controversy was entirely foreign: The dispute centered on the arrest of a foreign ship in foreign waters pursuant to the order of a foreign court. Given the proceedings ongoing in China, and the absence of cause “to second-guess the authority of Chinese law or the competence of [Chinese] courts,” the District Court granted the motion to dismiss under the doctrine of forum non conveniens.

A panel of the Court of Appeals for the Third Circuit agreed there was subject-matter jurisdiction under § 1333(1), and that the question of personal jurisdiction could not be resolved sans discovery. Although the court determined that forum non conveniens is a nonmerits ground for dismissal, the majority nevertheless held that the District Court could not dismiss the case under the forum non conveniens doctrine unless and until it determined definitively that it had both subject-matter jurisdiction over the cause and personal jurisdiction over the defendant. 436 F.3d 349 (C.A.3 2006).

. . .

We granted certiorari, 548 U.S. ----, 127 S.Ct. 36 (2006), to resolve a conflict among the Circuits on whether forum non conveniens can be decided prior to matters of jurisdiction. Compare 436 F.3d, at 361-364 (case below); Dominguez- Cota v. Cooper Tire & Rubber Co., 396 F.3d 650, 652-654 (C.A.5 2005) (per curiam) (jurisdictional issues must be resolved in advance of a forum non conveniens ruling), with Intec USA, LLC v. Engle, 467 F.3d 1038, 1041 (C.A.7 2006); In re Arbitration Between Monegasque De Reassurances S.A.M. (Monde Re) v. Nak Naftogaz of Ukraine, 311 F.3d 488, 497-498 (C.A.2 2002); In re Papandreou, 139 F.3d, at 255-256 ( forum non conveniens may be resolved ahead of jurisdictional issues). Satisfied that forum non conveniens may justify dismissal of an action though jurisdictional issues remain unresolved, we reverse the Third Circuit's judgment.

. . .

This is a textbook case for immediate forum non conveniens dismissal. The District Court's subject-matter jurisdiction presented an issue of first impression in the Third Circuit, see 436 F.3d, at 355, and was considered at some length by the courts below. Discovery concerning personal jurisdiction would have burdened Sinochem with expense and delay. And all to scant purpose: The District Court inevitably would dismiss the case without reaching the merits, given its well-considered forum non conveniens appraisal. Judicial economy is disserved by continuing litigation in the Eastern District of Pennsylvania given the proceedings long launched in China. And the gravamen of Malaysia International's complaint-misrepresentations to the Guangzhou Admiralty Court in the course of securing arrest of the vessel in China-is an issue best left for determination by the Chinese courts.

If, however, a court can readily determine that it lacks jurisdiction over the cause or the defendant, the proper course would be to dismiss on that ground. In the mine run of cases, jurisdiction “will involve no arduous inquiry” and both judicial economy and the consideration ordinarily accorded the plaintiff's choice of forum “should impel the federal court to dispose of [those] issue[s] first.” Ruhrgas, 526 U.S., at 587-588, 119 S.Ct. 1563. But where subject-matter or personal jurisdiction is difficult to determine, and forum non conveniens considerations weigh heavily in favor of dismissal, the court properly takes the less burdensome course.