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Aetna was recently hit with a $25.6M bad faith verdict for denial of an insured's cancer treatment in Oklahoma. When Orrana Cunningham was diagnosed with stage IV nasopharyngeal cancer in November, 2014, Aetna fought tooth and nail against her claims and those of her husband. The Cunnighams paid for appropriate treatment on their own and, after Orrana's untimely death, Ron pursued their claims against Aetna. The bottom line is that Aetna lost a $25.6 million bad faith jury verdict.
JONES ACT - TABLE OF CONTENTS
The Jones Act
VII. PRACTICE AND PROCEDURE C. Venue 2. Bases of Venue
Where plaintiff commenced action in district where he lived, by virtue of diversity jurisdiction, basing his claim both on unseaworthiness and 46 USCS Appx § 688, complaint must be dismissed unless plaintiff abandons his cause of action under 46 USCS Appx § 688, where defendant neither resided nor had principal office in district where plaintiff sued. Branic v Wheeling Steel Corp. (1945, CA3 Pa) 152 F2d 887, cert den 327 US 801, 90 L Ed 1026, 66 S Ct 902.
46 USCS Appx § 688 action must be brought in district in which defendant employer resides or in which his principal office is located. Peters v Detroit v Cleveland Nav. Co. (1927, DC NY) 24 F2d 454; Bannon v Seaboard A. L. R. Co. (1930, DC Ga) 52 F2d 886, 1931 AMC 1263; Davenport v Sinclair Nav. Co. (1939, DC Pa) 30 F Supp 191; Smith v Nicholson Universal S. S. Co. (1941, DC NY) 42 F Supp 1001, 1942 AMC 466; Macomber v De Bardeleben Coal Co. (1941, La App, Orleans) 4 So 2d 483, 1942 AMC 41, revd on other grounds 200 La 633, 8 So 2d 624, cert den 317 US 661, 87 L Ed 532, 63 S Ct 61.
539. Partnerships and unincorporated associations
Alternative "principal office" venue provision of 46 USCS Appx § 688, although superfluous as regards corporate employers, continues to serve its original purpose when defendant employer is not corporation. Pure Oil Co. v Suarez (1966) 384 US 202, 16 L Ed 2d 474, 86 S Ct 1394.
Under venue provision of 46 USCS Appx § 688, action against partnership may be brought either in district where principal office of partnership is located, or in district where any partner resides. McCullough v Jannson (1923, CA9 Or) 292 F 377, error dismd 267 US 608, 69 L Ed 812, 45 S Ct 350.
For venue purposes there is no recognizable difference between unincorporated partnership and unincorporated association; multistate unincorporated business organization has residence for venue purposes in district in which it is doing business even though not location of its principal office or place where its owner-partners live. Penrod Drilling Co. v Johnson (1969, CA5 Tex) 414 F2d 1217, cert den 396 US 1003, 24 L Ed 2d 495, 90 S Ct 552.
Action under 46 USCS Appx § 688 against partnership employer brought in district where it had its principal place of business must be dismissed for want of proper venue, where such employer's "principal office" was shown to be in another district. Harmon v Boland (1950, DC NY) 90 F Supp 559.
540. Corporate defendants
Record showed that steamship company incorporated under laws of New York had office in New York, and therefore, court would assume, in absence of objection, that its principal office was located in New York. Carroll v United States (1943, CA2 NY) 133 F2d 690, 1943 AMC 339.
Federal court in New York was without jurisdiction of action under 46 USCS Appx § 688 by Louisiana citizen against New Jersey corporation with place of business in Massachusetts. Summerall v United Fruit Co. (1935, DC NY) 11 F Supp 963, 1935 AMC 1202, affd (CA2 NY) 80 F2d 1020, 1936 AMC 199, cert den 298 US 658, 80 L Ed 1384, 56 S Ct 680.
Federal District Court for northern district of California did not have jurisdiction of action brought against corporation located and doing business in southern district of that state. Spence v Lawrence-Phillips S. S. Co. (1935, DC Cal) 1935 AMC 215.
Complaint alleging that defendant was incorporated in state other than Pennsylvania and had its principal office in Texas was dismissed by district court in Pennsylvania for improper venue under 46 USCS Appx § 688. Hartley v Sioux City & New Orleans Barge Lines, Inc. (1965, WD Pa) 247 F Supp 1015, 1966 AMC 649, affd (CA3 Pa) 379 F2d 354, 10 FR Serv 2d 33, 1968 AMC 474.
541. --Applicability of 28 USCS § 1391
Definition of residence in general venue statute, 28 USCS § 1391(c), providing that corporation may be sued in any judicial district in which it is doing business, is applicable to seaman's action under 46 USCS Appx § 688 against corporation, notwithstanding venue provision thereof conferrin 5 L Ed 2d 494, 98 S Ct 1449.
Venue is proper under 28 USCS § 1391(c), and consequently 46 USCS Appx § 688 in every district of state in which corporate defendant is incorporated. Davis v Hill Engineering, Inc. (1977, CA5 Tex) 549 F2d 314, reh den (CA5 Tex) 554 F2d 1065 and (ovrld on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).
Defendant corporation in proceeding under 46 USCS Appx § 688 may be sued in any district where it is incorporated or is doing business, pursuant to provisions of 28 USCS § § 1391 et seq., and 1651 et seq. Leffellad v Detroit & Cleveland Nav. Co. (1926, DC NY) 16 F2d 1011; Bagner v Blidberg Rothchild Co. (1949, DC Pa) 84 F Supp 973; Mincy v Detroit & Cleveland Navigation Co. (1950, DC NY) 94 F Supp 456, 1950 AMC 1843; Phillips v Pope & Talbot, Inc. (1952, DC NY) 102 F Supp 51.
Provision of 28 USCS § 1391(c) expanding definition of residence of corporation to include districts in which it is doing business, is applicable to cases under 46 USCS Appx § 688 and authorizes bringing of action in court of district other than one in which corporate employer has its principal place of business. Garland v Alaska S. S. Co. (1961, DC Alaska) 194 F Supp 792, 1963 AMC 2616.
Since United States Supreme Court has held that definition of "residence" in 28 USCS § 1391(c) applies to venue provision in 46 USCS Appx § 688 permitting suit in "district in which the defendant employer resides" and since defendant was incorporated or licensed to do business in Texas, venue in Eastern District of Texas was proper as corporation incorporated or licensed to do business in state may be sued in each district of that state; defendant's contention that venue was proper only in Southern District of Texas, residence of defendant's agent for service of process, was mistaken. Bailiff v Storm Drilling Corp. (1972, ED Tex) 356 F Supp 309.
542. --"Principal office" defined
Maintenance of office merely for solicitation of business by officers or agents, orders to be executed at home office, did not amount to having principal office or regular and established place of business within district. Stein v Standard Oil Co. (1929, DC NY) 36 F2d 258, 1929 AMC 1524.
Principal office as applied to corporations means head office, place where principal officers generally transact business, and place to which reports are made and from which orders emanate. Ebanks v Grace Line, Inc. (1947, DC NY) 73 F Supp 749.
543. --Point in time at which corporation is doing business in district
Summons and complaint served on state official and copy mailed to defendant foreign corporation in compliance with state statute was valid service, and federal District Court had jurisdiction over foreign corporation in diversity action for damages under 46 USCS Appx § 688 even though corporation which had been doing business in state at time of injury was not doing business in state at time of commencement of action or at the time of such service of process. Bloomfield v Paramount Pictures Corp. (West Coast Studios) (1964, DC Hawaii) 228 F Supp 715, 1966 AMC 827.
Venue of action under 46 USCS Appx § 688 was properly laid under 46 USCS Appx § 688 and 45 USCS § 56 in district in which defendant was doing business at commencement of action. Blanco v Gulf Coast Transp. Inc. (1964, WD La) 235 F Supp 197, 1965 AMC 2406.
Jones Act (46 USCS Appx § 688) claim brought by father of drowned seaman will not be dismissed for improper venue, where it is unclear from fishing vessel lease extent to which defendants maintained control over or responsibility for leased vessel and its Texas operations, because it is impossible at this stage to determine whether defendants were "doing business" in coastal waters of Texas during 1998 red snapper season. Ghio v Jambon (1998, SD Tex) 23 F Supp 2d 724.
544. --Agents for corporation
Summons was served on manager of company, subagents for corporation, at its office in Providence; defendant moved to vacate and quash attempted service of summons and to dismiss case for want of jurisdiction because defendant was Washington corporation and not doing business in Rhode Island; motion was granted on testimony of manager, upon whom service was made, that he had no instructions with regard to vessel from corporation and that his company was acting as agent for vessel under appointment from another steamship line which was acting as agent of corporation. Andrade v American Mail Lines, Ltd. (1947, DC RI) 71 F Supp 201.
545. --Alien corporations
Jurisdictional provision of 46 USCS Appx § 688 must be liberally construed; consequently alien corporation with branch office at United States port may be sued there or any other place where it does business and service may be had on its authorized agent. Arthur v Compagnie Generale Transatlantique (1934, CA5 Canal Zone) 72 F2d 662, 1934 AMC 1199.
46 USCS Appx § 688 permits suit against corporation of another country at place where such corporation has its principal office in United States. Stewart v Pacific Steam Navigation Co. (1924, DC NY) 3 F2d 329, 1924 AMC 1272.
546. --Dissolved corporations
Venue provisions of 46 USCS Appx § 688 apply to dissolved corporation or one in process of dissolution. Antonana v Ore S.S. Corp. (1956, DC NY) 144 F Supp 486; Maitland v C.D. Mallory and Co. (1941, DC NY) 1941 AMC 885.
JONES ACT - TABLE OF CONTENTS