Carl Thomas Rauch, III v. Day and Night Manufacturing Corporation et al.

Summary

The Sixth Circuit held that a district court may not sua sponte dismiss a diversity action for lack of personal jurisdiction when the defendants waived that objection through their litigation conduct. The court distinguished personal jurisdiction, which may be waived, from subject-matter jurisdiction, which may be raised sua sponte. It reversed and remanded after concluding that the defendants had waived any personal-jurisdiction objection under Federal Rule of Civil Procedure 12.

Holdings

1. A district court may not sua sponte dismiss an action for lack of personal jurisdiction over defendants who have waived or are precluded under Rule 12 from asserting that defense.
2. A defendant waives an objection to personal jurisdiction by failing to include it in its first Rule 12 motion or responsive pleading, and conduct such as filing an appearance, moving on another defense, stipulating to proceedings, and conducting discovery may establish waiver.

Questions Presented

1. Whether a district court may sua sponte dismiss a diversity action for lack of personal jurisdiction when the defendants have waived or are otherwise precluded from asserting that objection.
2. Whether Day and Night waived any objection to personal jurisdiction by failing to raise it in its first defensive motion or responsive pleading and by acting inconsistently with the defense.
3. Whether the district court was required to inquire sua sponte into subject-matter jurisdiction on remand.

Disposition

reversed_and_remanded