The Massachusetts Supreme Judicial Court has ruled that a party can waive its challenge to personal jurisdiction by actively engaging in litigation after it timely asserts the defense in a responsive pleading. Am. Int’l Ins. Co. v. Robert Seuffer GmbH & Co. KG, No. 11418 (Mass., decided May 14, 2014). The issue arose in the context ofclaims that the German defendant’s picture hangers failed and caused damage to a valuable painting.
The company raised the personal jurisdiction defense in its answer to the complaint, but then pursued litigation on the merits for more than 18 months before it filed a motion for summary judgment, based largely on the jurisdictional defense. The applicable rules of procedure set forth the grounds for waiver of the defense, but do not include this circumstance. The court agreed with the plaintiff that “failure to raise the defense in a motion or responsive pleading would ensure its forfeiture, but inclusion of the defense in such a pleading might not ensure its preservation.”
Declaring the matter fact-sensitive, the court explained that the parties’ conduct throughout the litigation could forfeit the defense. Among the factors courts must consider are the amount of time that has elapsed, any changed procedural posture of the case, the period between a party’s initial and subsequent assertion of the defense, the extent to which the party engaged in discovery on the merits, and whether the party engaged in substantive pretrial motion practice. During the 18 months following its response to the complaint, the defendant here conducted discovery on the merits, took depositions and even filed an emergency motion to compel inspection of the residence in which the picture hangers were used.
The court also determined that applying its interpretation of the rule retroactively would not impose any undue hardship on the litigants because its holding affirmed, rather than contradicted, extant case law and the German company’s active participation in the litigation caused both the plaintiff and court “to have a reasonable expectation that it would defend the suit on the merits.” While personal jurisdiction over the defendant was admittedly lacking, the court affirmed the lower court’s denial of the company’s motion for summary judgment.