Have you ever heard of the local action doctrine? The distinction between local and transitory actions? If you’re a lawyer, you might have heard something about this in law school. But perhaps not since then. The Supreme Court has not addressed it since 1912. But the Ninth Circuit held last week that the local action doctrine required dismissal of a putative class action for lack of jurisdiction. Eldee-K Rental Properties, LLC v. DIRECTV, Inc., No. 11-17994, 2014 U.S. App. LEXIS 6510 (9th Cir. Apr. 9, 2014). If the Ninth Circuit is correct that this doctrine remains valid and is a jurisdictional requirement, could it potentially apply to property insurance cases in some jurisdictions? Determining the answer to that, based on the Ninth Circuit’s method of analysis, could require extensive research of state law in the applicable jurisdiction, delving back many years. However, the doctrine, to the extent applicable, would only apply where a property insurance lawsuit is brought outside of the federal district where the property is located.

In Eldee-K Rental Properties, the plaintiff, which owns an apartment building in Hartford, Connecticut, brought a putative nationwide class action lawsuit against DIRECTV. The suit sought to challenge a practice whereby DIRECTV will install a satellite dish on an apartment building if the tenant signs a form stating that the landlord verbally approved the installation, or that approval is not required under the rental agreement. I’m guessing that the plaintiff’s theory was that many tenants either do not bother to read the form, or sign the form without actually having permission from their landlord. One might argue that the landlord benefits from having satellite TV available. But apparently this landlord did not want the dish. A bunch of these dishes on one apartment building can sometimes be an eyesore. But that was not what the Ninth Circuit was dealing with. The issue was whether this lawsuit could properly be brought all the way across the country in the Northern District of California, given that the plaintiff’s apartment building was in Connecticut. (Plaintiff sought to apply California law to a nationwide putative class.) DIRECTV argued that, under the local action doctrine, because the claims in essence involved trespass on real property, there was no federal jurisdiction in California. And the Ninth Circuit agreed.

The Ninth Circuit’s opinion traces the origins of the local action doctrine to pre-15th century England. At that time, jurors relied on their personal knowledge to decide disputes, with no witness testimony, and thus suits had to be brought locally where people would have heard of whatever the dispute was. Deciding cases based on local rumors and hearsay was eventually, and wisely, eliminated. But a remaining vestige of this ancient practice was that at least some cases involving real estate had to be brought only where the real estate was located. An early decision by Chief Justice John Marshall, sitting as a circuit judge, adopted this local action rule as a matter of federal common law. The Supreme Court confirmed its continued existence in the late 19th century, and the Ninth Circuit concluded last week that the Supreme Court’s 19th century precedent was still binding today (even though it is not embodied in any of the federal jurisdictional statutes).

According to the Ninth Circuit opinion, state law governs the issue of whether an action is local or transitory in nature. The opinion held that, under California law, claims for violation of the California Unfair Competition Law and for negligence were “local” in nature because they arose from injury to real property, i.e., an unauthorized installation of a satellite dish. The suit therefore could only be brought where the property was located. (Ironically, the “local” satellite dish downloads television programming from around the world via a massive device that orbits the Earth, and that neither a 15th century juror nor Chief Justice Marshall could ever have imagined.)

So what does all of this have to do with property insurance? Well, here are some questions this decision raises in my mind: Is there any state in which a “local” action (based on the old distinction between “local” and “transitory” actions) would encompass a property insurance dispute, in which the issues focus on damage to real property? Or is a contract dispute universally considered a transitory suit even if it involves real property? What if the suit is brought against both a tortfeasor who caused property damage as well as a property insurer (if both can properly be sued in the same lawsuit)? Perhaps these are just ruminations most appropriate for a law school final exam question. But maybe not.

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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career at Skadden.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and I was fortunate to have the opportunity to work on some prominent class actions arising from the 2004 hurricanes in Florida and later Hurricane Katrina, including cases involving the applicability of the flood exclusion, statutes known as valued policy laws, and various other issues.  My interest and experience in class actions gradually led me to focus on that area.

In Connecticut courts I’ve defended various kinds of class actions that go beyond insurance, including cases involving products liability, securities, financial services and consumer contracts.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at my desk or flying around the country trying to save insurance companies from the plaintiffs’ bar, or attending a conference on class actions or insurance litigation (for more on those, see the Seminars/Programs page of this blog), I often can be found playing or reading with my young daughter, helping my wife with her real estate and mortgage businesses, reading a book about history or politics, or watching the Boston Red Sox (I managed to find bleacher seats for Game 2 of the 2004 World Series when Curt Schilling pitched with the bloody sock).  When the weather is good I also love to take the ferry to Block Island, Rhode Island and ride a bike or walk the trails there. If you go, I highly recommend the Clay Head Trail.