New York Times v. Sullivan
144 So. 2d 25 (1962)
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Rule of Law:
A foreign corporation is subject to in personam jurisdiction in a state if it has certain minimum contacts with that state, such as systematic news gathering, product circulation, and advertising solicitation, such that requiring it to defend a suit there does not offend traditional notions of fair play and substantial justice.
Facts:
- The New York Times, a New York corporation, published a full-page advertisement on March 29, 1960, titled 'Heed Their Rising Voices.'
- L. B. Sullivan was the elected Commissioner of Public Affairs for Montgomery, Alabama, with supervisory responsibility for the Police Department.
- The advertisement described actions by Montgomery police against civil rights demonstrators, containing several factual inaccuracies.
- The advertisement did not mention L. B. Sullivan by name.
- The New York Times circulated approximately 390 daily and 2,500 Sunday editions of its newspaper in Alabama.
- Between 1956 and 1960, staff correspondents for The Times spent 153 days in Alabama gathering news, and the paper also employed resident 'stringer' correspondents.
- The Times, through its wholly-owned subsidiary, regularly sent representatives into Alabama to solicit advertising, generating tens of thousands of dollars in revenue.
Procedural Posture:
- L. B. Sullivan sued The New York Times Company and four individuals for libel in the Circuit Court of Montgomery County, Alabama, the state's trial court.
- The New York Times filed a motion to quash service of process, arguing the Alabama court lacked personal jurisdiction over it as a New York corporation.
- The trial court denied The Times' motion to quash.
- The case proceeded to trial, and a jury returned a verdict for Sullivan, awarding $500,000 in damages.
- The trial court entered judgment on the verdict and subsequently denied The Times' motion for a new trial.
- The New York Times, as appellant, appealed the judgment to the Supreme Court of Alabama.
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Issue:
Does a foreign newspaper corporation have sufficient 'minimum contacts' with Alabama to be subject to personal jurisdiction in an Alabama court for a libel action when its activities include news gathering by staff and 'stringer' correspondents, circulating newspapers, and soliciting advertising within the state?
Opinions:
Majority - Harwood, Justice
Yes. A foreign corporation is subject to personal jurisdiction in Alabama when its activities in the state are sufficient to meet the 'minimum contacts' standard established by International Shoe Co. v. Washington. The New York Times's activities in Alabama were not casual or isolated, but were systematic and continuous. The court found that news gathering, circulation, and advertising solicitation are all essential functions of a newspaper's business. The Times purposefully availed itself of the benefits of Alabama by circulating its papers for sale, gathering news for its publication, and soliciting substantial advertising revenue. These contacts are more than sufficient to make it reasonable and fair to require The Times to defend a libel suit in Alabama that arose from the distribution of its newspaper within the state. As an alternative basis for jurisdiction, the court held that The Times made a general appearance and waived any objection to personal jurisdiction by moving to dismiss the action for lack of subject-matter jurisdiction in addition to its personal jurisdiction challenge.
Analysis:
This decision represents an expansive application of the 'minimum contacts' doctrine for establishing personal jurisdiction over national media corporations. By aggregating news gathering, circulation, and advertising solicitation, the court found a 'systematic and continuous' presence sufficient for jurisdiction over a cause of action arising from the publication's content. This ruling lowered the jurisdictional bar for plaintiffs wishing to sue out-of-state publishers in their local forums, significantly increasing the litigation risk for newspapers and magazines with a national reach. The alternative holding regarding a general appearance also highlights a critical procedural rule where challenging both personal and subject-matter jurisdiction simultaneously can result in waiving the former.
