Hunter and the Reservation Trap

Hunter and the Reservation Trap

A federal defendant may move to dismiss for lack of personal jurisdiction under Rule 12(b)(2) before it answers.¹ It may not file a different pre-answer motion first and hold the jurisdictional objection back for later. Rules 12(g)(2) and 12(h)(1) require every Rule 12(b)(2) through (5) defense to be consolidated in one pre-answer motion. Hunter v. Serv-Tech, Inc. asked whether a defendant could escape that requirement by announcing that it "reserved" the defense.²

The procedural history is easiest to follow in date order:

1. On November 19, 2007, Brian Hunter sued Offshore Contractors and other defendants. Offshore was a Dutch company that had negotiated in Angola and the United Kingdom to charter the vessel on which Hunter was injured in the waters off Angola.³
2. On June 19, 2008, Offshore moved to dismiss for insufficient service of process. The second paragraph of that motion declared that the movants did not submit to the court's jurisdiction and that the defendants "expressly reserve all rights to challenge the subject matter and/or personal jurisdiction of this Court over Defendant Movants and/or raise other defenses to this claim."⁴
3. On July 10, 2008, Hunter filed an amended complaint by leave of court, and on July 22 he filed his response to the service motion.⁵
4. On September 11, 2008, Offshore answered and listed lack of personal jurisdiction as its third affirmative defense.⁶
5. The service motion was later granted in part and denied as moot as to Offshore, because Offshore concluded that Hunter had perfected service.⁷
6. On July 27, 2009, Offshore moved to dismiss for lack of personal jurisdiction, arguing that it lacked minimum contacts with the Eastern District of Louisiana.⁸

Hunter and a codefendant, Dynamic Industries, argued that Offshore had waived the defense by filing a pre-answer motion that left personal jurisdiction out. Offshore answered that its reservation language had put Hunter and the other parties on notice that it challenged jurisdiction.⁹ The timeline shows what the first motion actually did. It asked for dismissal on one ground, insufficient service, and it mentioned personal jurisdiction only as something Offshore might raise later. Because Offshore had made a pre-answer motion, Rule 12(g)(2) required it to consolidate its Rule 12 defenses, and under Rule 12(h)(1) the omission of a Rule 12(b)(2) through (5) defense from that motion waived it.¹⁰

The court decided the case on the wording of the two rules, which speak of a party that "makes a motion" and of a defense a party must "make it by motion." That wording suggests that a party who wants to preserve its Rule 12(b)(2) through (5) defenses before answering cannot simply "assert" or "reserve" the defense. It must argue the defense in a motion that asks the court to enter a ruling or order.¹¹ A motion is an application made to a court, and the action Offshore sought in its first motion was dismissal for insufficient service. To reserve an issue, by contrast, is to retain it for future use, and a reservation makes no present demand for action by the court.¹² Telling the court that a personal jurisdiction defense is reserved for a later motion therefore does not prevent waiver of the omitted defense. The defense must actually be raised by a motion that asks the court to dismiss on personal jurisdiction grounds, together with any other Rule 12(b)(2) through (5) defenses.¹³ Offshore's statement that it did not "submit" to jurisdiction asked for nothing either, and the court held that its "reservation" language was not enough to preclude waiver.¹⁴

The policy behind consolidation explains this reading. Required consolidation is meant to avoid piecemeal consideration of a case. Commentators likewise stress that the rule aims to eliminate unnecessary delay at the pleading stage by encouraging one omnibus pre-answer motion that advances every available Rule 12 defense.¹⁵ A reservation delivers none of that. It leaves the court with nothing to decide, and a defendant who could preserve a defense that way could move on one ground, keep the jurisdictional objection in reserve, and raise it whenever the case made that useful. That is the serial practice the rule exists to stop. The court therefore described the policy as one of promoting judicial efficiency, not merely of giving other litigants notice, and added that letting a litigant "reserve" a defense for later argument without making and arguing the motion would undercut the plain language and policy of the Rules.¹⁶ Hunter itself shows the cost of delay. When Offshore filed its second motion in July 2009, the case was more than a year and a half old, and extensive preliminary motion practice had kept the court from entering a scheduling order.¹⁷

Offshore's answer could not rescue the defense. Rule 12(b) allows these defenses to be asserted by motion and requires such a motion before pleading if a responsive pleading is allowed. Rules 12(g)(2) and 12(h)(1) govern the situation in which the defense is made by motion before the answer, and there every Rule 12(b)(2) through (5) defense must be consolidated and made in one motion or it is waived.¹⁸ Omitting a defense from the pre-answer motion bars the party from raising it again by another pre-answer motion and also from raising it by any other means.¹⁹ Offshore's third affirmative defense therefore came too late, because the answer followed a first motion that had already spent the chance to make the defense. Two variations show where the line falls. Had the June 2008 service motion also argued lack of minimum contacts, the defense would have been made by motion, and the court would have reached its merits. Had Offshore filed no pre-answer motion at all and pleaded the objection in its answer, the answer would have been its first response, and the earlier sections of this chapter explain that the defense would then have been preserved. In all three settings Offshore's objection is the same, and the only variable is whether its first filing asked the court to rule on that objection.

Authority on the point was thin. The court found only two federal decisions addressing whether a reservation in a pre-answer motion or pleading prevents waiver, and it used both to mark the edges of its holding.²⁰ In General Design Sign Co. v. American General Design, Inc. (N.D. Tex. 2003), the defendant waived personal jurisdiction by failing to argue it in a motion to dismiss for lack of venue, even though under the statute at issue an objection to venue implied lack of personal jurisdiction.²¹ Related grounds do not save each other, so Offshore's service motion no more made the jurisdictional objection than the venue motion did there. Transaero, Inc. v. La Fuerza Aerea Boliviana (2d Cir. 1998) is the closest a defendant who reserved has come to success. The defendant there added a footnote to its first responsive pleading, filed after a default judgment, purporting to preserve challenges to improper service and lack of personal jurisdiction. The Second Circuit held the footnote sufficient because a prior District of Columbia decision, entitled to res judicata effect until reversed on appeal, had precluded the defendant from arguing those defenses.²² The Hunter court confined Transaero to its facts, which involved procedural twists absent from the case before it.²³ The distinguishing fact is freedom to move. The Transaero defendant could not have made the defenses by motion, and the footnote did the only work available to it. Offshore could have put its jurisdictional argument in the first motion and chose to mention it only as a future possibility.

The court acknowledged that the result may be harsh, because absent waiver Offshore's motion might well have been granted.²⁴ It nevertheless felt duty-bound to apply the Rules as written, and as written they require all Rule 12(b)(2) through (5) defenses to be made by motion, once, before the answer is filed.²⁵ It held that Offshore's second motion was barred by Rules 12(h)(1) and 12(g)(2) and that Offshore had waived the defense.²⁶ Waiver ended the inquiry before the merits began, so the court did not decide whether Offshore had minimum contacts with the forum, and a defendant with a possibly sound objection lost it for want of a motion.

An exam stem in which a defendant "reserves," "does not concede," or "does not submit to" jurisdiction in a first motion points at this trap. The question is whether that paper asked the court to dismiss on that ground.

The ground of the first motion makes no difference, whether it was insufficient service as in Hunter or failure to state a claim as here. Any pre-answer Rule 12 motion triggers the consolidation duty, and only an argument actually made in that motion satisfies it.