Summary of a Recent
Judicial Development in
Migrant Labor

District Court Rules that New York Farmer
Subject to Personal Jurisdiction in Texas

Harrison M. Pittman
Staff Attorney

In an action brought under the Migrant and Seasonal Agricultural Worker Protection Act ("AWPA"), 29 U.S.C. §§ 1801-1872 (1999), and under certain provisions of Texas law, the United States District Court for the Western District of Texas has ruled that a New York farmer who recruited workers through a Texas farm labor contractor was subject to personal jurisdiction in Texas. Gonsalez Moreno v. Milk Train, Inc., 182 F.Supp.2d 590 (W.D. Tex. 2002). The court also ruled that the Western District was the proper venue for the lawsuit and that the forum selection clause in the parties' contract was voided by the AWPA. Id.

The plaintiffs were migrant farm workers who resided in El Paso, Texas. Id. at 592. Milk Train, Inc. ("Milk Train"), was a dairy business located in New York. Id. Armando Alvarez was a Texas-based farm labor contractor doing business as AG-Labor Services, Inc. ("AG-Labor"). Id. In 1999 and 2000, Milk Train used AG-Labor to recruit and hire the plaintiffs for work on Milk Train's New York dairy farm. Id. The plaintiffs filed a suit against both AG-Labor and Milk Train, alleging that in the course of their employment, the defendants violated five provisions of the AWPA and several provisions of Texas state law. Id.

Milk Train moved to dismiss for lack of personal jurisdiction and improper venue. Id. Milk Train also filed an alternative motion to transfer venue to New York. Id. The court rejected each of these motions. The court did not discuss or rule upon any other merits of the case.

To determine whether Milk Train was subject to personal jurisdiction, the district court examined whether the Texas long-arm statute allowed personal jurisdiction to be asserted over Milk Train and whether the assertion of personal jurisdiction comported with due process requirements. Id. at 593 (citing Ham v. La Cienega Music Co., 4 F.3d 413, 415 (5th Cir. 1993)). Due process requires that a defendant have "minimum contacts" with the forum state, and that the exercise of personal jurisdiction not offend "‘traditional notions of fair play and substantial justice.'" Id. (quoting Ham, 4 F.3d at 415) (citing Asahi Metal Indus. v. Superior Court, 480 U.S. 102 (1987) and Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985)). A defendant establishes "minimum contacts" when it "‘purposefully avails [itself] of the benefits and protections of the forum state . . . . '" Id. (quoting Marathon Oil Co. v. A.G. Ruhrgas, 182 F.3d 291, 294-95 (5th Cir. 1999)).

Minimum contacts can be categorized as general or specific. Id. General jurisdiction relates to contacts which "‘are continuous, systematic, and substantial.'" Id. (quoting Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 415 (1984)). To establish general jurisdiction a defendant's contacts need not be related to the underlying cause of action. Id. (citing Helicopteros, 466 U.S. at 415)). For specific jurisdiction, a plaintiff must show that a defendant "‘purposefully directed' its activities at the residents of the forum.'" Id. at 593-94 (quoting Burger King, 471 U.S. at 472)). It is also necessary to demonstrate that the suit is a result of alleged injuries that "‘arise out of or relate to'" a defendant's activities directed at the forum. Id. (quoting Burger King, 471 U.S. at 472) (citing Helicopteros, 466 U.S. at 414)). Id. at 594. After making these determinations, a court must examine the relationship between the defendant, the forum, and the litigation to decide whether maintaining the suit offends "‘traditional conceptions of fair play and substantial justice.'" Id. (quoting Helicopteros, 471 U.S. at 464). The plaintiffs contended that Milk Train's contacts were sufficient to establish specific jurisdiction.

The district court ruled that the Texas long-arm statute allowed it to exercise personal jurisdiction over Milk Train, that Milk Train was subject to specific personal jurisdiction, and that Milk Train's activities satisfied the minimum contacts standard. These rulings were based on the facts that Milk Train contacted AG-Labor to recruit Texas residents for work on its New York farm, that it paid a fee to AG-Labor for each recruited worker, that it hired the plaintiffs as a result of its agency relationship with AG-Labor, that the plaintiffs signed their employment contracts in Texas, and that Milk Train provided AG-Labor with the terms and conditions for the plaintiffs' employment. Id.

The court ruled that it could exercise personal jurisdiction under the Texas long-arm statute because "a nonresident does business in Texas if the nonresident ‘recruits Texas residents, directly or through an intermediary located in this state, for employment inside or outside this state'" Id. (quoting Tex. Civ. Prac. & Rem. Code Ann. § 17.042(3)). The court also determined that because Milk Train's activities gave rise to a cause of action based on an intentional tort, Milk Train had purposefully availed itself (establishing minimum contacts) to Texas. Id. at 594-95 (citing Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208 (5th Cir. 1999) (finding that "[w]hen the actual content of communications with a forum gives rise to intentional tort causes of action, this alone constitutes purposeful availment").

Having made these determinations, the district court examined whether the exercise of personal jurisdiction over Milk Train comported with "‘traditional notions of fair play and substantial justice.'" Id. at 595 (quoting Burger King, 471 U.S. at 476). This determination required consideration of five factors: (1) the defendant's burden in litigating in the forum state; (2) the forum state's interests in litigating the matter; (3) the interests of the plaintiff in convenient and effective relief; (4) the interests of the judicial system in efficient resolution of controversies; and (5) the shared interests of the several states in furthering fundamental substantive social policies. Id. (citing Asahi, 480 U.S. at 113 and World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292 (1980)).

The first factor weighed in favor of the plaintiffs because Milk Train would not bear a substantial burden by defending the suit in Texas. Id. The court noted that the plaintiffs would be burdened if they were required to litigate the action in New York. Id. The second factor also favored the plaintiffs because Texas had a significant interests in protecting its citizens from exploitation by out-of-state employers, in providing its citizens with a forum for redress, and in enforcing its long-arm statute. Id. at 595-96. The third factor favored the plaintiffs because Texas was clearly a more convenient forum for the plaintiffs. Id. at 596. The court found that the fourth and fifth factors were neutral, in that they were not determinative for either Milk Train or the plaintiffs. Id.

The court stated that "in light of the fact that three of the factors articulated in Asahi weigh in favor of this Court's exercise of personal jurisdiction over Milk Train, and the remaining factors are neutral, the Court is of the opinion that the exercise of jurisdiction does not offend "traditional notions of fair play and substantial justice." Id.

The court rejected Milk Train's assertions that the forum selection clause contained in the parties' contract divested the Texas court of jurisdiction, and that the clause not only required the dispute to be brought in New York, but that it precluded the suit from being brought in Texas. Id. The forum selection clause at issue stated that any litigation between the parties was to occur in New York. Id. The court noted that under the AWPA, "‘agreements by employees purporting to waive or modify their rights under this chapter shall be void as contrary to public policy.'" Id. at 596-97. (quoting 29 U.S.C. § 1856). The court added, the AWPA "guarantees that employees shall have the right to file suit in ‘any district in the United States having jurisdiction of the parties . . . . '" Id. at 597 (quoting 29 U.S.C. § 1854(a)). The court concluded that these provisions of AWPA rendered the forum selection clause unenforceable "‘because plaintiffs may not contractually waive their statutory right to file suit in ‘any district court of the United States having jurisdiction of the parties . . . . '" Id. (quoting § 1854(a)).

The court also ruled that because it could assert personal jurisdiction over Milk Train Texas was the proper venue. Id. (citing Stewart v. Woods, 730 F.Supp. 1096, 1097 (M.D. Fla. 1990) (observing that in a suit under AWPA, if a court has jurisdiction, then venue is proper).

Finally, the court denied Milk Train's alternative motion to transfer venue for convenience of the parties. Id. The venue transfer statute provides that "‘for the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district of division where it might have been brought.'" Id. (quoting 28 U.S.C. § 1404(a) (West 1993)). The court examined five factors to determine whether venue should be transferred pursuant to § 1404(a): "(1) the availability and convenience of witnesses and parties; (2) the place of the alleged wrong; (3) the location of the books and records; (4) the possibility of delay or prejudice if transfer is granted; (5) the location of counsel; and (6) the plaintiff's choice of forum." Id. at 598 (citing Hall v. Environmental Chem. Corp., 64 F.Supp.2d at 644 (S.D. Tex. 1993)).

The first factor weighed against Milk Train because all but two of the witnesses were located in El Paso, Texas. Id. The second factor neither favored or disfavored Milk Train because the alleged wrongdoing occurred both in Texas and New York. Id. The third factor disfavored Milk Train because Milk Train had not carried its burden in demonstrating which documents were relevant or "so voluminous that transporting them would be impractical." Id. (citing Gardipee v. Petroleum Helicopters, Inc., 49 F.Supp.2d 925, 931 (E.D. Tex. 1999) (observing that when considering a motion to transfer venue, the location of books and other records is usually given little weight, unless the documents ‘are so voluminous that their transport is a major undertaking'") (quoting Met-L-Wood Corp. v. SWS Indus., Inc., 594 F.Supp. 706, 710 (N.D. Ill. 1984)).

The court stated that the fourth factor neither favored or disfavored Milk Train because the trial would not likely be delayed whether the venue was in Texas or New York. Id. Because both the plaintiffs' and Milk Train's attorneys were located in the Western District of Texas, the fifth factor "most certainly weigh[ed] against transferring venue." Id. With respect to the sixth factor the court noted that "a plaintiff's choice of forum is given considerable weight and will not be disturbed unless the other factors weigh substantially in favor of transfer." Id. at 598-599 (citing Robertson v. Kiamichi R.R. Co., 42 F.Supp.2d 651, 656 (E.D. Tex. 1999)). Because the plaintiffs chose to bring this action in the Western District of Texas and few other factors weighed in favor of transferring venue to New York, the sixth factor disfavored Milk Train as well. Id. at 599.

In sum, the district court ruled that it could properly exercise personal jurisdiction over Milk Train, that the Western District of Texas was the proper venue, that the forum selection clause was voided by provisions of the AWPA, and that there was no compelling reasons to transfer venue from Texas to New York.