Harold Noel Arrowsmith, Jr. v. United Press International

320 F.2d 219, 6 A.L.R. 3d 1072, 7 Fed. R. Serv. 2d 38, 1963 U.S. App. LEXIS 5021

• Court: Court of Appeals for the Second Circuit
• Decided: June 11, 1963
• Docket: 73, Docket 27641
• Status: Published

Opinions

FRIENDLY, Circuit Judge.

On October 13, 1961, plaintiff, a resident of Maryland, brought this action for libel against United Press International (hereafter UPI), a New_York corporation, in the District Court for Vermont. He alleged that a news dis-patchTiransmitted by defendant on October 17, 19.58, under an Atlanta, Georgia, dateline, which reported the dynamiting of an Atlanta synagogue, contained a defamatory reference to him as a “ ‘fat cat’ financier” of anti-Semitic terrorist activity.¹ The complaint did not allege that the dispatch was printed or broadcast in Vermont, although we do read it as alleging the transmission ,o£ the dispatch to UPI’s subscribers ..there. Neither did the complaint allege that Arrowsmith was known to anyone in Vermont, that he had any “reputation” in that state, or that such “publication” as occurred in Vermont resulted in any injury to him in any state where he did have a reputation. The complaint sought “general damages” of $56,280,000, a sum calculated at $JLQ,000 for each_of_UEL’fi_Sffii!8 subscribers in the United States and foreign countries. Although the record does not reveal why the action was brought in Vermont, a quite sufficient, explanation can be perceived by taking appropriate account of the dates recited in the first two sentences of this opinion, of Vermont’s three-year statute of limitations for libel, 12 V.S.A. § 512(3), and of the much shorter ones of other states.^{2 3}

UPI moved under F.R.Civ.Proc._12(b)___ to dismiss on various grounds, including lack of personal jurisdiction, improper venue, and failure of the complaint (primarily because_it~alleged no special damages)..^ state a claim upon which relief could be granted? Judge Gibson .sustained the last mentioned, ground; he did not pass on the first two. 205 F.Supp. 56 (D.Vt.1962). Plaintiff.appeals from the judgment of dismissal.

We all agree it was error for the district court to proceed as it did. Not only does logic compel initial consideration of the issue of jurisdiction over the defendant — a .court without such jurisdiction lacks power_ to_ dismiss a complaint for failure to state a claim— 'but the functional difference that flows from the ground selected for dismissal likewise compels considering jurisdiction^ and venue questions first. A dismissal for lack of jurisdiction or improper venue does not preclude a subsequent action in an appropriate forum, whereas a dismissal for failure to state a claim upon which relief can be granted is with prejudice. We shall therefore vacate the judgment dismissing the complaint for failure to state a claim on which relief can be granted and remand the case for consideration of the issue of jurisdiction over the person of the defendant and, in the event that this be found, the issue of venue, prior to consideration of the merits.³ In so remanding it is incumbent on us to decide what standard should govern the judge’s determination as to tile)jurisdiction of the District Court for Vermont over the person of the foreign corporation — .defendant—in ' particular, whether a “state” or a “federal” standard should here be applied. A summary will provide the needed background.

The affidavits submitted by UPI. on the motion to dismiss showed the following facts relevant to the issues of jurisdiction and venue: UPI has eleven subscribers in Vermont (two newspapers, eight radio stations, and one radio-television station) to which it transmits news and news pictures over circuits leased from the Bell System, which owns all the equipment save for teletypewriters in the subscribers’ premises, these being owned by UPI. UPI has one employee “ in Vermont, Isabelle McCaig, who is the “manager” of its Montpelier “news bureau” and upon whom service of process was made. UPI has no office in Vermont; Miss McCaig occupies desk space in a general news room in the State House in Montpelier. There she “punches out” Vermont news stories on a wire leading to UPI’s Boston office, where her transmittals are rewritten, as well as to the nine broadcast subscribers in Vermont and fourteen in New Hampshire. With the exception of the dispatches received over this wire, all of UPI’s transmissions to its Vermont subscribers originate outside the state, as was true of the allegedly libelous dispatch here. UPI’s gross billings to its Vermont subscribers in 1960 represented less than 0.14% of its total gross billings to subscribers in the United States and foreign countries. Plaintiff’s affidavit added nothing significant to his complaint; he indicated that he expected to be able to prove the transmission of the offending dispatch to some of UPI’s Vermont subscribers, but said nothing as to its use by them or as to any injury suffered by him in Vermont or elsewhere as a result of the “publication” there.

I.

The issue of the standard to be in determining whether a federal court has jurisdiction over the person of a foreign corporation in a suit where federal jurisdiction is founded solely on diversity of citizenship, 28 U.S.C. § 1332, has arisen frequently since the late Judge Goodrich’s penetrating opinion, written for the First Circuit and concurred in by Judges Magruder and Woodbury, in Pulson v. American Rolling Mill Co., 1 Cir., 170 F.2d 193 (1948). He analyzed the problem as follows:

“There are two parts to the question whether a foreign corporation can be held subject to suit within a state. The first is a question of "“state law: has the state provided for bringing the foreign corporation into its courts under the circumstances of the case presented ? There is nothing to compel a state to exercise jurisdiction over a foreign corporation unless it chooses to do so, and the extent to which it so chooses is a matter for the law of the state as made by its legislature. If the state has purported to exercise jurisdiction over the foreign cor- ,/ poration, then the question may arise whether such attempt violates the due process clause or the interstate commerce clause of the federal ^constitution. Const, art. 1, § 8, cl. 3; Amend. 14. This is a federal question and, of course, the state authorities are not controlling. But . it is a question which is not reached’?? for decision until it is found-that the^ State statute is broad enough to assert jurisdiction over the defendant in a particular situation.”

Finding that the Massachusetts statute as interpreted by the Supreme Judicial Court did not purport to subject the defendant to suit in Massachusetts, the court affirmed Judge Wyzanski’s dismissal of the suit, saying “we have no occasion to discuss how far recent decisions might allow a state to go in extending its jurisdiction in this field.”

This conclusion, that a federal district court will not assert jurisdiction.over a corPora^on in an ordinary diversity case unless that would be done by the state court under constitutionally valid state legislation in the state where the court sits, has been reached in almost every circuit that has considered the issue:

First: Pulson v. American Rolling Mill Co., supra; Waltham Precision Instr. Co. v. McDonnell Aircraft Corp., 310 F.2d 20 (1 Cir. 1962);

Third: Partin v. Michaels Art Bronze Co., 202 F.2d 541, 542 (3 Cir. 1953) (“So the first question which comes up in a case like the one at issue is whether the State, here Pennsylvania, has, through legis-^/ lation plus the judicial application thereof, asserted jurisdiction over the defendant”);

Fourth: Easterling v. Cooper Motors, Inc., 26 F.R.D. 1, 2 (M.D.N.C.1960) (“There are two relevant North Carolina statutes dealing with jurisdiction over foreign corporations. * * * If service of process is to be sustained in this case, it must be under one of these statutes”) ;

Fifth: Stanga v. McCormick Shipping Corp., 268 F.2d 544, 548 (5 Cir. 1959) (“The first part is to ascertain whether the state law means to encompass the challenged service. This question — at least as to diversity cases [of] which this is one — is wholly a matter of state law”); New York Times Co. v. Conner, 291 F.2d 492 (5 Cir. 1961), judgment vacated on the basis of a changed view of state law, 310 F.2d 133 (5 Cir. 1962);

Seventh: Canvas Fabricators, Inc. v. William E. Hooper & Sons Co., 199 F.2d 485, 486 (7 Cir. 1952) (“The primary contested issue is whether defendant was ‘doing business’ in the State of Illinois so as to be amenable to local process * * *. This' being a diversity case, it can hardly be doubted but that the main question for decision is controlled by local law”); Rensing v. Turner Aviation Corp., 166 F.Supp. 790, 796 (N.D.Ill.1958); National Gas Appliance Corp. v. AB Electrolux, 270 F.2d 472, 475 (7 Cir. 1959), cert. denied, 361 U.S. 959, 80 S.Ct. 584, 4 L.Ed.2d 542 (1960); Green v. Robertshaw-Fulton Controls Co., 204 F.Supp. 117, 127-128 and n. 9 (S.D.Ind.1962);

Eighth: Charles Keeshin, Inc. v. Gordon Johnson Co., 109 F.Supp. 939 (W.D.Ark.1952); Hilmes v. Marlin Firearms Co., 136 F.Supp. 307-308 (D.Minn.1955) (“where jurisdiction in a ease is based solely upon diversity of citizenship, the power of the federal district court to entertain the case is dependent upon whether the case could have been brought in the state court of the state in which the federal district court is located”) ; see Electrical Equipment Co. v. Daniel Hamm Drayage Co., 217 F.2d 656, 661 (8 Cir. 1954);

Ninth: Kenny v. Alaska Airlines, Inc., 132 F.Supp. 838, 842-849 (S.D.Cal.1955) (“Our first reference then in determining the ‘doing business’ question, must be to the law as declared by the legislature and courts of the state of California”) ; Kesler v. Schetky Equipment Corp., 200 F.Supp. 678 (N.D.Cal.1961), citing L. D. Reeder Contractors of Arizona v. Higgins Industries, Inc., 265 F.2d 768, 776-79 (9 Cir. 1959) ;

Tenth: Steinway v. Majestic Amusement Co., 179 F.2d 681, 684 (10 Cir. 1949), cert. denied, 339 U.S. 947, 70 S.Ct. 802, 94 L.Ed. 1362 (1950) (“we know that the Oklahoma courts have not gone so far [as the 14th Amendment permits], and we cannot now forecast that they will”).

There thus exists an overwhelming consensus that the. amenability _ of_ a foreign .corporation to suit-.in a federal court in„a..diversity. action-is ■ de- - Yermined in accordance_witb.theilaw--of ( the state where the court sits, with “fed- f eral'law” entering the picture -only — for \ the purpose of decidin^whetbar-a.^tate’s S assertion of jurisdiction contravenes a. constitutional guarantee.⁴ In all probability the elaborate attempt, made in the appendix to the dissenting opinion, to whittle this comprehensive body of authority down to the Third and Seventh Circuits is sufficiently answered by the language we have quoted from various ^opinions. However, it may not be amiss . i to add that the premise of the argument, \! |namely, that all cases arising under F.R. ' Civ.Proe. 4(d) (7) must be disregarded, is quite unsound. F.R.Civ.Proc. 4(d) ! (3) and (7) both relate to the manner of ¡service and leave open the question ^whether the foreign corporation was sub-l.ject to service in any manner. Thus, although the Pulson case, for example, arose under Rule 4(d) (7), the issue was not as to the person served but as to the liability of the defendant to sérvice. v It was that issue which Judge Goodrich, writing for the First Circuit, held to be one of state law, subject only to federal constitutional limitations. Judge Goodrich cited and relied on Pulson and expressly disagreed with the contrary view,. stated in an earlier edition of Professor Moore’s treatise and advanced in the instant dissent, when he wrote for Judge Hastie and himself in Partin, supra, 202 F.2d at 542-543, in his own circuit, a case which our brother Clark recognizes to be directly in point against the position advocated by him.

The only contrary voice by a court of appeals is our decision, by a divided panel, in J^ftex — jCorpniatiaQ^ v. Randolph Mills, Inc., 282 F.2d 508 (2 Cir. 1960). In that case all three judges agreed that a judgment in the Southern District of New York dismissing a complaint against a North Carolina corporation should be reversed because New York would have asserted jurisdiction under a constitutionally valid statute. But a majority went on to elaborate in -an opinion by Judge Clark, as an alternative ground for coming to the same conclusion, “that the question whether a foreign corporation is present in a district to permit of service of process upon it is one of federal law governing the, procedure - of the United States courts and is to be determined accordingly.’’ 282 F.2d at 516. T)he service there was evidently thought to be good under this “federal standard”, although the opinion does not say just what that standard is or where it can be found. In banc reconsideration of Jaftex was not sought. In the instant case a majority of the panel (Friendly and Marshall, JJ., Clark, J., dissenting), believing that the alternative ground of decision in Jaftex was unwarranted, was causing confusion by its failure to identify or define the “federal standard”, and was leading to unfortunate results in the district courts,⁵ and that we should bring ourselves in line with other circuits, requested that .the case be considered in banc on the briefs already before us. This request for in banc consideration was granted, Judge Clark alone dissenting. We have concluded that the alternative ground of decision in Jaftex, asserting a “federal-standard” for jurisdiction over foreign! corporations in ordinary diversity cases, should be overruled.

No federal statute or Rule of Civil Procedure speaks to the issue either expressly -axJay_fair implication. 28 U.S.C. § 1391(c), providing that “[a] corporation mfty be sued in any judicial district in which it is incorporated or licensed to do Jiusiness or is * doing business,” relates to venue and not to jurisdiction, as is made clear by considerations polnted out in the concurring opinion in Jaftex, 282 F.2d at 518, and there recognized by the majority, 282 F.2d at 512. Neither is anv instruction to be found by combining the provlsinn ip F.R.Civ.Proc. 4(d) (3) that, service may be made “upon a domestic or foreign corporation or upon a partnership or other unincorporated association which is subject to suit under a common name, by delivering a. copy of the summons and of the complaint to an officer. a managing or general agejijt, or to anv other agent authorized by appointment or by law to receive service of process(and7jf the agent is one authorized by statute to receive service and the statute so requires, by also mailing a copy to the defendant,” witR-the provision of Rule 4(d) (7) that m 'the" case of “a defendant of any class refeTred to in paragraph (1) or (3) of this subdiviYsion of this ruTe, it is”also'’sufficient if the summons and complaint' are served in the manner prescribed by any statute of the United States or in the manner prescribed by the law of the state in which the service is made for the service of summons or other like process upon any such defendant in an action brought in the courts of general jurisdiction of that state.” To do so would put far .more strain on the words “or foreign” in Rule 4(d) (3) and “also” in Rule 4(d) (7) than they will bear, bjo one reading the Rul^would be lik^JcrgeETEeTinpfession ÜjaJ]Kll«4(i)-4^)w?asA¿haxto ¡ to the federal courts to make their own ■J law as to when a foreign corporation is subject to suit and that the effect of-Rule 4(d) (7) is to make state standards of j urisdiction T(MentatwePy ^applicable, The Advisory Committee’s Notes.reveal no such intention; leather they emphasize^ the much more limited one, whichvthe language of the Rule indicates, of regulating the 'gwmner of service, saying that paragraph (3) “enumerates the oflieers and agents of a corporation or of a partnership or other unincorporated-*association upon whom service of process may be made * * Eminent authority thus seems entirely justified in concluding that “Rule 4(d) (3Lof the Rules of ■s Civil Procedure tells (hoa) service .of ^process is to he^ made upon a cornora- {/ tion which(iis subject)to service; but it ^ does not tell wíiéñ the corporation is* so subject.” Hart & Wechsler, The Federal Cofirts and the Federal System, 959 (1953).

Despite contrary intimations as to our position in the dissent, we fully concede that the constitutional? doctrine announced in Erie R. R. v. Tompkins, 304 U.S. 64, 78-80, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), would, not prevent Congress ..or its rule=making delegate from authorizing a district court to assume jurisdiction over, a foreign corporation in an ' ordinary diversity case although the state court would not; and w¿ reaffirm decisions of this Court that have sustained the application of certain Federal Rules of Civil Procedure differing from the rules applied by the state where the court sits. Iovino v. Waterson, 274 F.2d 41 (2 Cir. 1960), cert. denied, 362 U.S. 949, 80 S.Ct. 860, 4 L.Ed.2d 867 (1961) [Rule 25(a) (1) relating to substitution]; Hope v. Hearst Consol. Publications, Inc., 294 F.2d 681 (2 Cir. 1961), cert. denied, 368 U.S. 956, 82 S.Ct. 399, 7 L.Ed.2d 388 (1962) [Rule 43(a) relating to qaidencel. the latter decision relying heavily on Monarch Ins. Co. v. Spach, 281 F.2d 401 (5 Cir. 1960), quoted in the instant dissent. But we find no federal nojicv that should lead federal courts in diversity cases to override valid state laws as to the subjection of foreign corporations to suit, in the absence of direction by fed'eral statute or rule. State statutes determining what foreign corporations"may be sued, for what, and by whom, are not mere whimsy; like most legislation they represent a balancing^of-variogs. corisid” erations — for example, affording a forum fdFwrongs connected with the state and conveniencing resident plaintiffs, while avoiding the discouragement of activity within the state by foreign corporations. We see nothing in the concept of diversity-jurisdiction that should lead us to read into the governing statutes a Congressional mandate, unexpressed by Congress itself, to disregard the balance thus struck by the states.⁶ The famed ji dicial statement'oF the reason for diversity jurisdiction, “However true the fact may be, that the tribunals of the states will administer justice as impartially as those of the nation, to parties of every description, it is not less true that the constitution itself either entertains apprehensions on this subject, or views with such indulgence the possible fears and apprehensions of suitors, that it has established national tribunals for the decision of controversies between aliens and a citizen, or between citizens of different states,” Marshall, C. J., in Bank of the United States v. Deveaux, 5 Cranch. (9 U.S.) 61, 87, 3 L.Ed. 38 (1809), does not suggest that the founders were con-\ cerned with rendering diversity defend-\ ants, who might be either in-staters or out-of-staters, more readily suable in they federal court than they would be in the state court. Thus, the present dissent-points out no federal policy that makea. it important to provide this Maryland! plaintiff with a federal"" forum ini Vermoñt, if Vermoiit~lfselT^OTlS,,',Hb'll entertain such an‘*ay1il5Ii7"f6r“'wKat~“in every prpcf.icaL^Hae~is~gr another ^M-of-state predomirññmy^nrTtót wholly, state. If the suit was by an in-stater, j-1 the case for a “federal standard” broad-’ er than the state’s would be still weaker there is /no federal concern.-ior..enabling< 1 such a plaintiff to sue a foreign cornoration in bis own, state when that very state, though hayjagjthejower to do so, has declined to make its own courts ava.il able.^ And in the classic case of diversity jurisdiction, the suit bv an out-of-stater against a true in-stater (in the present context, a foreign corporation really identified with the state), such a “federal standard” would be quite superfluous, for the “state standard” will almost inevitably ensure jurisdiction. Supreme Court decisions enforcing state “door-closing” statutes in the federal courts, and the reasons there expressed. Angel v. Bullington, 330 U.S. 183, 191-192. 67 S.Ct. 657, 91 L.Ed. 832 (1947);⁷ Woods v. Interstate Realty Co., 337 U.S. 535, 69 S.Ct. 1235, 93 L.Ed. 1524 (1949),⁸ appear to point in precisely the opposite direction from the dissent here; it seems immaterial that in such cases the state policy is expressed as a closing of the door against a particular kind of suit or plaintiff rather than as a refusal to pull a particular kind of defendant through the door. State policy is involved in one case as much as in the other, and in the absence of an overriding federal interest intimated by Congress or its delegate, should be equally respected.

Our belief that neither the federal legislature nor the~TederaT rtfle- \ makers have nad’myiñféiffibñ^tó 'dfsplace ;■ state"^atüí'es“ás"Tó_fFé"faking of “juris- - diction óyérfforéi^yórpórations in órcti- r nary' TlfveTslfy “cases' Ts”s"trengthened by instaTHygs~wheW,'Yffc¥rtmn~typlesbgf''federal question litigation, Congress has provided for-servic^off nrbcess outside ‘ the district. A fairly early example is 22, § 12 of the Clayton Act, 15 U.S.C which directs that in any action under aflti-trust laws against a corporation, v-6nue may be laid in any district “whereof it is an inhabitant” or “wherein it may be found or transacts business”, and that process may be served “in the district of which it is an inhabitant, or wherever it may be found.” This seems to show that Congress neither" "'thought'. there,.existed nor wished to create a 7ifed> 1 eral standard” broad enough" to warrant service of process in antitruitlitightio: in any district where a _ corporation “transacts business’!: it directed íhat transaction of business was to suffice for venue but that process was then to* be served elsewhere. See Eastman Kodak Co. v. Southern Photo Materials Co., 273 U.S. 359, 47 S.Ct. 400, 71 L.Ed. 684 (1927) (venue in action against Eastman laid in Northern District of Georgia but process served at head office in Rochester, N. Y.); United States v. Scophony Corp., 333 U.S. 795, 68 S.Ct. 855, 92 L.Ed. 1091 (1948). A similar scheme was used in § 22 of the Securities Act of 1933, 15 U.S.C. § 77v, in § 27 of the Securities Exchange Act of 1934, 15 U.S.C. § 78aa, in § 25 of the Public Utility Holding Company Act of 1935, 15 U.S.C. § 79y, and in § 44 of the Investment Company Act of 1940, 15 U.S.C. § 80a-43a — all of which, of course, apply to individuals as Wjell as to corporations. See also the legislation as to national banks dealt with in Mercantile Nat. Bank v. Langdeau, 371 U.S. 555, 83 S.Ct. 520, 9 L.Ed.2d 523 (1963), and Michigan National Bank v. Robertson, 372 U.S. 591, 83 S.Ct. 914, 9 L.Ed.2d 961 (1963).⁹

We are told, however, that the existence of a “federal standard” of jurisdiction over foreign corporations in diversity cases has been established by binding authority which the many courts of appeals and district courts that have decided otherwisehave failed to perceive or understands.¹⁰ Consideration of this contention requires analysis of the history of the taking of jurisdiction over , foreign corporations.

As has often been pointed out, the courts have had difficulty in evolving a satisfying justification for this. At the start, they had to overcome the notion that a corporate entity could have no legal existence outside the state of its creation. See Bank of Augusta v. Earle, 13 Pet. (38 U.S.) 519, 588, 10 L.Ed. 274 (1839). For many years, beginning with LaFay-ette Ins. Co. v. French, 18 How. (59 U.S.) 404, 408, 15 L.Ed. 451 (1856), the received theory, which can be found in Supreme Court decisions as late as Mr. Justice Stone’s in Louisville & Nashville R. R. v. Chatters, 279 U.S. 320, 325-326, 49 S.Ct. 329, 73 L.Ed. 711 (1929), was of “‘implied consent” by the foreign corporation to state statutes conditioning the right to do business on amenability to suit. Most of the Supreme Court cases as to challenges to the assertion of jurisdiction over foreign corporations during this period came from state courts. There the state had., authoritatively construed its statute and the Supreme .Court decided only the issue of constitutionality. But even when the case came from a lower federal court, the question whether the corporation’s “consent” embraced the particular suit was necessarily one of state law, for the “consent” was to what the state statute constitutionally demanded, and the construction of state statutes, even in the heyday of Swift v. Tyson, 16 Pet. (41 U.S.) 1, 10 L.Ed. 865 (1842), was for state judges, although the question whether the state might permissibly exact such a consent was a constitutional one. Hence we find it_impqssible to regard the four opinions by Mr. Justice Brandéis,¹¹ the future author of Erie, which are cited in Professor Moore’s treatise, 2 Federal Practice (2d ed. 1962), at 969, although not for this precise point,.as establishing a “federal-standard” as to jurisdiction over foreign corporations.¹² The writer"of"the opinion in Barrow S.S. Co. v. Kane, 170 U.S. 100, 18 S.Ct. 526, 42 L.Ed. 964 (1898), on which Professor Moore does rely, id. at 970, appears to have been unconscious that he was giving birth to a “federal standard” of jurisdiction over foreign corporations; the thrust of the opinion was rather that the corporation was doing enough in New York to be suable there on any standard, and that the state’s “door-closing” statute with respect to causes of action arising outside the state would not be honored in the federal courts — a view inconsistent with the later decisions in Angel v. Bullington, supra, and Woods v. Interstate Realty Co., supra.

The consent doctrine was later succeeded, or supplemented, by a theory of “presence” ; judges developed wondrous capacity to determine that a foreign corporation was “present” in the state in certain instances, but “absent” from it in others although something had somehow gotten done there. These spooks were banished, and fresh air let in, by Judge Learned Hand’s observation in Hutchinson v. Chase & Gilbert, Inc., 45 F.2d 139, 141 (2 Cir. 1930), that “It is difficult, to us it seems impossible, to impute the idea of-locality to a corporation, except by virtue of those acts which realize its purposes. * * * If we are to attribute locality to it at all, it must be equally present wherever any part of its work goes on, as much in the little as in the great”; the basis for determining whether or not to take jurisdiction, he suggested, was., to be found not in metaphysical subletiesjj but ’ in a standard of reasonableness; Since Hutchinson was a removed case,' Judge Hand could hardly have been thinking in terms of “federal law,” see Bomze v. Nardis Sportswear, Inc., 165 F.2d 33, 35 (2 Cir. 1948), save for the limiting principles of the due process clause of the Fourteenth Amendment (and in sopie instances other constitutional provisions). Then came International Shoe Co. v. Washington, 326 U.S. 310, 317, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945), a case from a state court, in which the Supreme Court recognized that concepts such as consent and presence are mere rationalizations and that, in the words of Chief Justice Stone, the true question is the existence “by such_c.ontacts of the corporation with "the.state of "the forum as make it reasonable, in the context of our federal system of government, to require thj^corporatio.n to. dpfejid the particular suitjwhich is brought there.”

The-decision..of„what_conta&ts,-within the constitutionally permitted sphere, shall suffice to make a' foreign corporation subject to suit is, one for the state to make in tha-first instance: once the state'has made this, there is no reason for a federal court to go further — or less far — when it is acting under a head of jurisdiction supposedly designed to protect certain suitors from possible prejudice by state courts. We do not deny that the diversity clause of the Constitution also Has^~potentiaI~utility in’perffrftting a federal court, with the possibility ófñation-wide service of process, to give a remedy'unavairable''elsewhCTa"Butto "do that Jn limited classes of" cases ."'under <Tsfatutes specially designed for the purpose, e. g., interpleader, 28 U.S.C. § 2361, or proposals currently underUÍIscussion by the American Law Institute,¹³ is quite a different matter from permitting every "plaStiflT entitled~forfnvoEe" 'fiiveriinty" Jurisdiction to escape state policy “with'respect to the amenability to suit oT"foréign corporations. alwavsTsuaEle in the' state of their domicile, by bringing ~fiis~ actionjji_a federal ratlief~than _a_ state • 'coürtT.

I We see little relevancy in the citation of Byrd v. Blue Ridge Rural Elec. Co-op., 356 U.S. 525, 537-540; 78 S.Ct. 893, 2 L.Ed.2d 953 (1958), and Simler v. Conner, 372 U.S. 221, 83 S.Ct. 609, 9 L.Ed.2d 691 (1963), holding that whether an isisue is of the sort triable.to a jury must 1 be decided as a matter_ of federal law ¡regardless of the law of the state where I the court sits,(am) surely no warrant for 6 saying that the latter decision has reinforced the alternative ground of Jaftex. These cases proceed on the basig^iat “the federal policy favoring j ury decisions of disputed fact questions^, a policy framed “under the influence — if. not the command of the Seventh Amendment”, 356 U.S. at 537-538, 78 S.Ct at 900, 901, and “of historic and continuing strength,” 372 U.S. at 222, 83 S.Ct. at 610 was such that federal courts should not yield to a contrary “state rule in the interest of furthering the objective that the litigation should not come out one way in the federal court and another way in the state court,” 356 U.S. at 538, 78 S.Ct. at 901. We are aware of no federalh policy of similar strength or constitution-I al basis that would justify disregard of ¡ state laws as to when a foreign corpora- | tion may be held to answer in a suit ljke ' the present. How warily the Supreme Court proceeds in disregarding state law even in the area of jury trial is shown by its refusal to decide whether federal courts in diversity actions may develop ftheir own standards as to the quantum ‘■of evidence necessary for submission to a jury. Dick v. New York Life Ins. Co., 359 U.S. 437, 444-445, 79 S.Ct. 921, 3 L.Ed.2d 935 (1959); and see the recent denial of certiorari, two Justices dissenting, 371 U.S. 935, 83 S.Ct. 307, 9 L.Ed.2d 271 (1962), to review Merritt-Chapman & Scott Corp. v. Gunderson Bros. Eng. Corp., 305 F.2d 659 (9 Cir.).¹⁴

Neither do we find force in the statement in Jaftex, 282 F.2d at 513, that “[t]he federal and state rules are certainly not so mutually at odds that the federal decision will seriously damage state polity.” When, as in the New York situation there sub índice, the state standard and the supposed “federal standard” are identical or nearly so, it is hard to see what useful purpose the concept of a separate “federal standard” serves; when the “federal standard” is alleged to be significantly different from that which the state has chosen, it is equally hard to see what justification there is for it. One may agree with the premise of the dissent that the quest for uniformity between: state and federal courts 7'cant-b'e-"pushed too far, particularly when the issue may reasonably be denoted as one of procedure, without accepting the apparent conclusion that deliberately creating a difference in result between state and federal courts on an issue such as jurisdiction over foreign corporations in a diversity case is so demonstrable a good as to warrant federal judges in substituting their views for state legislators’. This is especially true when the inevitable result is to ^create still another difference — between^ di- | versify cases coming to the federal courts \ initially and those coming on removal. \where we do not understand how it can be asserted that the federal court has] jurisdiction over a foreign corporation if ‘ the state court did not.¹⁵ Viewed in the light of International Shoe and the subsequent cases, assertion of a state’s judicial jurisdiction over foreign corporations was simply an earlier instance of the same principle that underlies the assertion of such jurisdiction over non-resident individuals having, or having had, sufficient “contacts” with the state. See Chief Justice Stone’s reference to Hess v. Pawloski, 274 U.S. 352, 47 S.Ct. 632, 71 L.Ed. 1091 (1927), in International Shoe, 326 U.S. at 316, 318, 66 S.Ct. at 158, 159.¹⁶ Absent a direction in statute , or rule, there is no more reason, in an fordinary diversity case, for a federal court to make up its own law in the former situation than in the latter.¹⁷

II.

Having concluded that jurisdiction over the person of the defendant is to be determined here on the basis of conjstitutionally valid Vermont law, we fSaah, the quesMoirwiiethér'we should -rfiake the] determination on our own account or remand for initial consideration by the district judge. '

Vermont's provisions with respect to personal jurisdiction over foreign corporations are contained in Subchapter 6 of Title 12 of the Vermont Statutes. Section 851 provides that “[w]hen a foreign corporation has appointed the secretary of state as its process agent, pursuant to the statutes relating to such corporations, service of process, made upon such secretary by delivering to him duplicate copies thereof, shall be sufficient.” Whether Vermont would thmk UPI had been “doing business” in the state to an extent requiring it so to ap-noint the secretary of state, 11 V.S.A. §§ 652(a), 691(a), 692(3), is not clear. See Kinnear & Gager Mfg. Co. v. Miner, 89 Vt. 572, 96 A. 333 (1916); cf. Star-Chronicle Pub. Co. v. United Press Ass’ns, 204 F. 217 (8 Cir. 1913). In any event, UPI hadnot so appointed him, and Vermont, unlike many states, see, e. g., Conn.Gen.Stats. § 33-411(b), has no statute providing generally that a foreign corporation which does business in the state without obtaining a required certificate of authority and appointing an agent to receive process shall be subject to suit as jf it liar! ^Tip.wliif it nuirM to have done. Vermont does have two statutes that assert jurisdiction over unregistered foreign corporations in certain circumstances, but neither seems applicable here. One, which authorizes service on ■“an agent, messenger or operator of such company” — broadened in 1959, Public Act No. 261, § 11, to include other persons on whom process against a domestic corporation could be served — is limited to “a foreign insurance, express, shipping car, telephone, or telegraph company or other foreign company doing like business” in the state, 12 V.S.A. §§ 853, 854, all of these being companies which serve the public generally and are subject to state regulation, as UPI does not and is not, even if we should assume Vermont would think it was “doing business” in the state at all.¹⁸ The other statute, 12 V.S.A. § 855, provides that:

“If a foreign corporation makes a contract with a resident of Vermont to be performed in whole or in part by either party in Vermont, if such foreign corporation comA mits a tort in whole or in part in \ Vermont against, a^esident of Ver-Jmont, such acts shall be deemed to be doing business in Vermont by such foreign corporation and shall be deemed equivalent to the appointment by such foreign corporation of the secretary of the state of Vermont and his successors to be its true and lawful attorney upon whom may be ¡ served all lawful process in any ac- ! tions or proceedings against such ; foreign corporation arising from or / growing out of such contract or tort.”

Since plaintiff is not a resident of Vermont as § 855 requires,¹⁹ it is unneces-eary to determine whether Vermont would consider that the mere transmission from outside the state to defendant’s Vermont subscribers of a dispatch alleged to libel a person not claimed to have any reputation in Vermont, or to have been injured in his reputation elsewhere by the transmission to Vermont, constituted the commission of a tort “in whole or in part in Vermont.” Cf. Ting-ley v. Times-Mirror Co., 144 Cal. 205, 206, 77 P. 918, 919 (1904).

Although the case thus does not appear to come within either of these statutes, the questions remain whether Vermont would nevertheless fill the gap beA, tween them and assert jurisdiction over \ this defendant on the basis, stated a-A half century ago in the attachment case of Somerville Lumber Co. v. Mackres, 86 Vt. 466, 85 A. 977-978 (1913), that “there being no statute specifically relating to the service of process on foreign corporations doing business in this state other than the one requiring them to appoint a process agent, they must be taken, if they omit that, to assent to be served with process the same as other non-resident defendants are served”, and whether the Fourteenth Amendment would permit Vermont to do that on the facts here. See Hanson v. Denckla v. 357 U.S. 235, 251, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); Blount v. Peerless Chemicals, Inc., 316 F.2d 695 (2 Cir. 1963). While it would be valuable to have the-benefit of Judge Gibson’s consideration* of the first question, and, indeed, of tfe other matters of Vermont law that we have mentioned, there would be no point in imposing a further burden upon him and upon the parties if assertion of jurisdiction by Vermont over the person of UPI in this action would violate the Fourteenth Amendment. On the rather meagre record before us, this might well be so. UPI’s Vermont activities, while perhaps greater than those of the defendants in Blount v. Peerless Chemicals, Inc., supra, or in New York Times Co. v. Sullivan, 273 Ala. 656, 144 So.2d 25 (1962), cert. granted, 371 U.S. 946, 83 S.Ct. 510, 9 L.Ed.2d 496 (1963), were rather small and did not arise from a privilege that Vermont could have withheld. Hanson v. Denckla, supra, 357 U.S. at 252, 78 S.Ct. at 1239. The Supreme Court’s most advanced decisions in this area have stressed that the obligation in suit arose out of the corporation’s activity in the state, International Shoe Co. v. Washington, supra, 326 U.S. at 319, 66 S.Ct. at 159; McGee v. International Life Ins. Co., 355 U.S. 220, 223, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957); ²⁰ that it was owing either to the state itself as in International Shoe, see also Travelers Health Ass’n v. Virginia, 339 U.S. 643, 70 S.Ct. 927, 94 L.Ed. 1154 (1950), or to a resident as in McGee; and that the McGee case related to “an activity [insurance] that the State treats as exceptional and subjects to special regulation.” Hanson v. Denckla, supra, 357 U.S. at 252, 78 S.Ct. at 1239. Here the plaintiff has not averred, either in the complaint or in his affidavit in opposition to the motion to dismiss, that he had any reputation in Vermont or was known to a single person there, or that his reputation anywhere else was injured by such “publication” as occurred in Vermont. The alleged injury was thus, so far as appears, suffered wholly outside Vermont and was not a result of anything done there. Mattox v. News Syndicate Co., 176 F.2d 897, 900 (2 Cir.) (L. Hand, J.), cert. denied, 338 U.S. 858, 70 S.Ct. 100, 94 L.Ed. 525 (1949); compare Christopher v. American News Co., 171 F.2d 275, 280-281 (7 Cir. 1948); see Tingley v. Times-Mirror Co., 144 Cal. 205, 206, 77 P. 918, 919 (1904); Caldwell v. Crowell-Collier Pub. Co., 161 F.2d 333, 335 (5 Cir.), cert. denied, 332 U.S. 766, 68 S.Ct. 74, 92 L.Ed. 351 (1947).²¹ And the only “publication” alleged to have occurred in Vermont, the receipt of the dispatch by UPI’s subscribers, not only is not alleged to have caused injury there or elsewhere but did not arise out of the activity in the state which is asserted to make defendant subject to suit, namely, the collecting and transmission of Vermont news by Isabelle McCaig.

On the other hand, the papers before us are meagre; a hearing, along with an amendment of the complaint which the judge might allow, may present a picture .different from what we now have. We therefore remand for consideration of the issues relating to jurisdiction, and, if the District Court should find these favorably to plaintiff, the issue of venue, before any further consideration of the merits. Since the court may not reach the venue issue, we shall not discuss it except to say that the court should not regard us as necessarily committed to the view, generally followed in the Southern District of New York but never passed on by us, whereby “the criteria which are applied in determining corporate presence for the jurisdictional purpose of effecting valid service of process” are “equally applicable to the venue provisions of § 1391(c).” Champion Spark Plug Co. v. Karchmar, 180 F.Supp. 727, 731 (S.D.N.Y.1960). Accord, Satterfield v. Lehigh Valley R.R., 128 F.Supp. 669 (S.D.N.Y.1955); Ostow & Jacobs, Inc. v. Morgan-Jones, Inc., 178 F.Supp. 150, 154 (S.D.N.Y.1959); First Congregational Church v. Evangelical & Reformed Church, 160 F.Supp. 651, 662-663 (S.D.N.Y.1958). But see Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 73 S.Ct. 900, 97 L.Ed. 1331 (1953); Remington Rand, Inc. v. Knapp-Monarch Co., 139 F.Supp. 613, 617-619 (E.D.Pa.1956); Rensing v. Turner Aviation Corp., 166 F.Supp. 790, 798 (N.D.Ill.1958); Carter v. American Bus Lines, Inc., 169 F.Supp. 460, 469-470 (D.Neb.1959).

The judgment dismissing the complaint is vacated and the cause remanded for further proceedings consistent with this opinion.

1 . The dispatch read as follows:

“Atlanta — (UPI)—Five persons were indicted today in connection with the dynamiting of the Jewish Temple here.

“The grand jury handed down indictments against the quintet that could possibly send them to the electric chair on charges of dynamiting of the house of worship on famed Peachtree Street last Sunday.

“An Atlanta detective working on the case disclosed meanwhile that the identity is known of a so-called ‘fat-cat’ financier of such terrorist activity as the temple bombing.

“Most investigators believe the bombing was part of an interstate, or possibly international, conspiracy.

“Detective Oapt. R. E. Little, Jr., said he ‘definitely’ knows the identity of person referred to in a confiscated letter as the ‘fat cat’ financier who, the writer said, ‘is putting his $ $ $ where his mouth is, God bless him.’ The Arlington, Ya., Sun said he is a resident of Baltimore.

“Police released the text of a letter that spoke of the ‘fat cat’ financier.

“The Associated Press said an Arlington printer (George Lincoln Rockwell) who turns out anti-Jewish literature acknowledged today he wrote a letter which-has figured in the bombing of a Jewish Temple in Atlanta.

“Rockwell said the letter was written-last July to Wallace H. Allen in Atlanta.

“FBI agents interviewed Rockwell but the FBI declined to disclose the outcome.

“It was learned in Washington that the FBI Thursday questioned Rockwell and Harold Noel Arrowsmith, Jr., described as a member of a wealthy Baltimore family.

“Authorities today sought a mystery figuro thought to be the mastermind of dynamitings in the South.

“Further evidence of the ‘fat cat’s’ role was reported by police in a letter containing this line: ‘The big blast is all set for either next Sunday or Saturday * * * we will know tomorrow and will keep you informed.” ’

2 . Thus, New Tork, where defendant is incorporated and whence the libel was allegedly transmitted to Vermont, Georgia, where the libel originated, and Maryland, where plaintiff resides, all have one-year statutes of limitations for defamation. N.T.Civil Practice Act § 51-3; Book 2, Tit. 3 Ga.Code Ann. § 1004; 57 Md.Code Ann. § 1. Defendant asserted at the argument that the only states with periods of limitation as long as three years were Vermont and Arkansas. A suit brought by plaintiff against de- ■ fendant in federal court in Arkansas, where defendant’s activities are considerably more extensive than in Vermont, was dismissed for want of jurisdiction by tlie District Court for the Eastern District of Arkansas, No. LIb-61-C-160, and we are told that plaintiff’s appeal from this order was dismissed on April 30, 1962. It appears that two other states, Hawaii and New Mexico, even more remote from the locus of the present claim, have limitation periods of three years or longer for libel actions. Hawaii Rev. Laws § 241-1 (e); N.M.Stats.Ann. § 23-1-8.

3 . If the district court should find it necessary again to consider the sufficiency of the complaint, it ought consider not simply Vermont internal law but the law or laws that a Vermont court would apply under applicable choice of law rules. See Hartmann v. Time, Inc., 166 F.2d 127, 133 (3 Cir. 1947), cert. denied, 334 U.S. 838, 68 S.Ct. 1495, 92 L.Ed. 1763 (1948); Brewster v. Boston Herald Traveler Con)., 188 F.Supp. 565, 560, 577 (D. Mass.1960), 74 Harv.L.Rev. 1457 (1961) ; Prosser, Interstate Publication, 51 Mich.L.Rev. 959, 971-78 (1953).

4 . A district judge in the Sixth Circuit seems to have construed Scliolnik v. National Airlines, 219 F.2d 115 (6 Cir. 1955) as establishing a “federal standard” although disagreeing with the view he thought it announced, Shuler v. Wood, 198 F.Supp. 801 (E.D.Tenn.1961), and a “federal standard” was approved by another district judge in First Flight Co. v. National Carloading Corp., 209 F.Supp. 730 (E.D.Tenn.1962). However, the issue was not determined in Scholnik. Although the Scholnik opinion discussed federal constitutional decisions rather than Ohio law, this must be read against the Sixth Circuit’s earlier statement that the Ohio courts had declared that the state’s “doing business” statute “should be liberally construed to facilitate the obtaining of jurisdiction over a foreign corporation doing business in Ohio, where a citizen of that state seeks redress upon a transaction with such foreign corporation,” Bach v. Friden Calculating Mach. Co., 167 F.2d 679, 680 (6 Cir. 1948), and thus as going to the limits which the Federal Constitution permitted. The per ouriam opinion in Lasky v. Norfolk & W. Ry. Co., 157 F.2d 674 (6 Cir. 1946), is similarly explicable. The Sixth Circuit later held, WSAZ, Inc. v. Lyons, 254 F.2d 242, 244 (6 Cir. 1958), that in a rejnoved action against a foreign corporation, jurisdiction of the federal court depended on whether the state court had acquired it — obviously a matter of state statute and decisional law subject to federal constitutional requirements. The writer of the WSAZ, Inc. opinion and a judge who joined in it had also participated in Scholnik; one would suppose that if the Sixth Circuit thought it had adopted a rule leading to different treatment of foreign corporations in original and removed suits, it would have made that clear to the profession. The issue was likewise not determined by the district judges in Shuler v. Wood, supra, where the court found the defendant was within valid Tennessee “doing business” statutes, or in the First Flight case, supra, where the court ended up by deciding on the basis that federal jurisdiction was founded on the presence of a federal question. Another district judge in the Sixth Circuit has properly not regarded Scholnik as a pronouncement for a “federal standard”; he held rather, citing Bach and other cases, as well as Judge Goodrich’s opinions in Pulson and Partin, that “state law governs whether a for'eign corporation is subject to service in a diversity action.” Singleton v. Atlantic Coast Line R. R., 20 F.R.D. 15, 18 (E.D.Mich.1956).

5 . A striking instance is Southern New England Distrib. Corp. v. Berkeley Finance Corp., 30 F.R.D. 43 (D.Conn. 1962). The. district judge, on the basis of a scholarly review of Connecticut statute and decisional law, found (1) that “Connecticut, as a matter of state policy, has recognized the advantage of not imposing qualifications on the right of foreign corporations to conduct some kinds of commercial and financial transactions, since it has enumerated certain business activities of foreign corporations which do not constitute ‘transacting business’;” (2) that the defendant’s activities came within these exclusions, as found in Conn. Gen.Stats. § 33-397(b); and (3) that the complaint did not allege tortious conduct in Connecticut under another statute, § 33-All (c) (4), authorizing service on a foreign corporation in such a ease “whether or not such corporation is transacting business in this state.” 30 F.R.D. at 45-48. Yet, in deference to Jaftex, these modern and comprehensive statutes, representing Connecticut’s assessment of the relative interest of plaintiffs, defendants, and the state itself, were set at naught, in an ordinary diversity suit, in favor of a supposed “federal standard.” ...

In fact, the Southern New England result may not have followed so inevitably from Jaftex as the judge thought. For the case came into the federal court on removal, and thus Connecticut law would still govern the- validity of the service (subject, of course, to constitutional limitations), unless Jaftex overruled sub silentio not only Judge L. Hand’s decision in Bomze v. Nardis Sportswear, Inc., 165 F.2d 33, 35 (2 Cir. 1948), but also Lambert Run Coal Co. v. Baltimore & O. R.R., 258 U.S. 377-382, 42 S.Ct. 349, , 66 L.Ed. 671 (1922)—no mean feat for 1 two judges of a court of appeals. But , this probable error serves to highlight another unhappy effect of Jaftex, discussed below, the undesirability of having two different rules for jurisdiction over foreign corporations in diversity actions depending on whether the case is originally brought in the federal court or is removed there. And the unfortunate result which the judge thought that Jaftex obliged him to reach would/have been required in a suit brought orig-‘ inally in federal court.

6 . The diversity clause of Article III was not one of the provisions of the Constitution about which the founders felt very deeply. " Madison thought it was not “a matter of much importance. Perhaps it might be left to the state courts.” 2 Elliot, Debates on the Federal Constitution (1828), at 391. Marshall conceded in the Virginia convention, “Were I to contend, that this was necessary in all cases, and that the government without it would be defective, I should not use my own judgment.” Id. at 406.

7 . “The essence of diversity jurisdiction is that a federal court enfacfiea^SJtata-law and State policy. If North Carolina has authoritatively announced that deficiency cannot ¡)é secured within its borders, it contradicts the presuppositions of diversity jurisdiction for a federal court in that State to give such a deficiency judgment. North Carolina would hardly allow defeat of a State-wide policy through occasional suits in a federal court.” 330 U.S. at 191-192, 67 S.Ct. at 661, 662.

8 . A state ^tzitute barring suit by foreign corporations which had not qualified is CaDie m a.federal court: “ * * * : which apptj ajpghlfr which ' ..________ it does not supt^ with a. remedy is.,no right at all for purposes of enforcement in a federal copr(-. ip" a diversify ^a.” 337 U.S. at 538, 69 S.Ct. at 1237.

9 . We express no opinion whether a “federal standard” may govern jurisdiction over foreign corporations in federal question litigation not covered either hy such special statutes or by contrary ones assimilating the situation to diversity litigation, e. g., § 23 of the Bankruptcy Act. Suffice it to say that the considerations favoring the overriding of state policy would be far more persuasive than in an ordinary diversity suit. We likewise express no opinion as to whUt~sfandard~is tg govern when -process is sérvé^jmj^dg the state und'eWthe fOO-mile provision for certain types of litigation, added to , F.B.Ciy.Proc.~SIfy,~^ective July 1. 1963.

10 . -vAs to the argument based on ■§ 11..of the First Judiciary, Act (now embodied in 28 U.S.C. § 1391). it is-enough, to say that this has always been a venue provision and nothing more. The dissent is right in stating that we have given no weight to 28 U.S.C. § 1693, also stemming from § 11, which says, “Except as otherwise provided by Act of Congress, no -person shall he arrested in one district for trial in another in any civil action m a district court.” The allegedly important bearmg of this provision still escapes us.

11 . Philadelphia & Reading Ry. Co. v. McKibbin, 243 U.S. 264, 37 S.Ct. 280, 61 L.Ed. 710 (1917); Rosenberg Bros. & Co. v. Curtis Brown Co., 260 U.S. 516, 43 S.Ct. 170, 67 L.Ed. 372 (1923) Bank of America v. Whitney Central National Bank, 261 U.S. 171, 43 S.Ct. 311, 67 L.Ed. 594 (1923); James Dickinson Farm Mortgage Co. v. Harry, 273 U.S. 119, 47 S.Ct. 308, 71 L.Ed. 569 (1927).

12 . An additional reason is that the Rosenberg Bros, and James Dickinson cases came into the federal court bv rgmoval, where a federal court hasfo^^ggcli. ju-risdictionas_fte_state-coujJJjad, Mr. Justice Brandéis had written only a year before Rosenberg Bros.: “Tf tho .■¿int-» court lacks jurisdiction of the sub.i ect-matter or of the partial p|Q feiWal courl_acquires none * * Lambert Run Coal Co. v. Baltimore & O. R. R., 258 U.S. 377, 382, 42 S.Ct. 849, 351, 66 L.Ed. 671 (1922). Yet nothing in the four opinions suggests that the Court had a different “standard” in mind for the two original-jurisdiction cases.

13 . See American Law Institute, Study of the Division of Jurisdiction between State and Federal Courts, Tentative Draft No. 1, pp. 21-32, 70-108. In view of the dissent’s emphasis on academic support for Jaftex, based on a few law review comments, it is of interest that the proposal by the Council of the American Law Institute is that Congress enact a con- , trary rule for ordinary diversity cases. Id. § 1303, pp. 11, 54-56. The Institute’s Reporters are Professor Richard I-I. Field of Harvard and Professor Paul T. Mishkin of Pennsylvania; their advisers include Professor Henry M. Hart, Jr., of Harvard and Professor Herbert Wechsler of Columbia, now Director of the Institute. At the meeting of the Institute in May, 1963, the Reporters agreed to consider whether the proposed provision should not take the form of a Rule rather than a statute.

14 . The dissent’s disapproval of some of our decisions relating to this subject thus seems at least premature.

15 . The dissent seems to concede this but does not explain why Congress should have wished the bizarre results that the concession entails. Thus, under the “federal standard” view, a foreign corporation which could have a suit by an in-stater dismissed in the state court or on removal if the “state standard” was narrower than the federal one, would gain nothing thereby since it would be subject to suit by the in-stater in the federal court.

16 . See also the reference to Hess v. Pawloski and to Henry L. Doherty & Co. v. Goodman, 294 U.S. 623, 55 S.Ct. 553, 79 L.Ed. 1097 (1935), in McGee v. International Life Ins. Co., 355 U.S. 220, 223, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957), and the statement in American Law Institute, Restatement of Judgments, § 28, comment a.

17 . We have taken the references in Jaftex, see 282 F.2d at 510, to leading Supreme Court opinions on constitutionality to mean that the “federal standard” wad\ coterminous with the outermost limit per- \ mitted to a state under the due process/ clause of the Fourteenth Amendment. It would seem curious that a “federal standard” should be framed in terms of an Amendment applicable to state rather than federal action, and the dissent repudiates this view. We are told that the “federal standard” is quite well known and reasonably precise, but are given little further information about it save for phrases like “doing business” and “presence,” which have meant many different things to different courts and, as Judge Learned Hand held in Hutchinson v. Case & Gilbert, supra, boil down to notions of what is fair and reasonable, with much depending on the nature of the plaintiff’s claim. It is far from apparent why principles of fairness and reasonableness concerning the locus of suit should be thought to subject this defendant, which was available for service at its home office in New York and presumably in many other places where it had substantial establishments, but was doing very little in Vermont, to process in Vermont in a suit by a nonresident on a claim which, so far as now appears, is wholly unrelated to anything done in that state. Paraphrasing Judge Hand, 45 F.2d at 142, it would seem fairer that Arrowsmith should have come to New York, or have stayed in Baltimore, than that UPI should go to Vermont.

18 . 12 V.S.A. § 853, imposing a penalty-on the specified types of companies doing business in Vermont for failing to designate the secretary of state as process agent as required, and 12 V.S.A. § 854, providing that when a stipulation so appointing the secretary is not filed, “process may be served by delivering a true and attested copy thereof, with the officers’ return thereon to an agent, messenger or operator of such company residing in this state or to any person enum-ei’ated in section 813 of this title,” have been coupled ever since the Vermont legislature adopted “An Act Providing for Service of Process on Foreign Insurance, Express, Telegraph and Telephone Companies,” Laws of 1884, No. 46, in which these provisions were §§ 3 and 4, and codifiers of Vermont law have uniformly linked the two sections thereafter. See V.S.1894, §§ 4168-69; V.P.L.1906, §§ 4747 — 48; V.G.L.1917, §§ 1741-42; V.P.L. 1933, §§ 1524-25; V.S.1947, §§ 1560-61; 12 V.S.A.1958, §§ 853-54. The 1959 amendment of § 854, Public Act No. 261, § 11, broadened the category of persons upon whom the summons could be served to include the same persons as a current revision of § 813 provided in the case of domestic corporations; but nothing in the text suggests an intention to expand § 854 to include all foreign corporations rather than the limited category to which' it had been restricted since its original enactment in 1884.

19 . Question might be raised whether Vermont’s limiting the benefits of this corporate “long-arm” statute to plaintiffs who are Vermont residents is consistent with the equal protection clause of the Fourteenth Amendment and the privileges and immunities clause, Art. IV, § 2. A sufficient answer may lie in McGee v. International Life Ins. Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957), where the California statute in issue was confined to suits on insurance contracts with California residents and was sustained in part on that very ground; moreover, the Court cited with approval, 355 U.S. at 223, 78 S.Ct. at 201 n. 2, Smyth v. Twin State Improvement Co., 116 Vt. 569, 80 A.2d 664, 25 A.L.R.2d 1193 (1951), sustaining the constitutionality of 12 V.S.A. § 855. If the validity under the due process clause of the Fourteenth Amendment of subjecting a foreign corporation to suit within a state on the basis of isolated activities within it depends upon a balancing of the interests of the plaintiff and the defendant, see 73 Harv.L.Rev. 909, 923-28 (1960), the fact that the plaintiff resides within the state is surely a relevant consideration, as the McGee decision indicates. The state has an interest in not making it too burdensome for foreign corporations to engage in activity within its borders. Even as regards contracts made or torts committed in the state, it would seem not unreasonable for it to limit a long-arm statute against foreign corporations to suits by its own residents, whose rights and welfare it desires to protect by affording them a readily accessible forum, without having to do this also for non-residents, who may be able to sue with equal convenience in another state and who can always obtain jurisdiction in the state of incorporation. If a statutory classification is thus appropriate in the administration of the due process clause, it can hardly be outlawed by the equal protection clause of the same Amendment. Invocation of the privileges and immunities clause against 12 V.S.A. § 855 would encounter the further obstacle that the statute speaks in terms of residents rather than citizens. See Douglas v. New York, N. H. & H. R. R., 279 U.S. 377, 49 S.Ct. 355, 73 L.Ed. 747 (1929). But see Toomer v. Witselb 334 U.S. 385, 396-397, 68 S.Ct. 1156, 92 L.Ed. 1460 (1948); Currie and Schreter, Unconstitutional Discrimination in the Conflict of Laws: Privileges and Immunities, 69 Yale L.J. 1323, 1347—49 (1960).

As to what the consequences would be if the limitation to residents were deemed invalid, see Mr. Justice Holmes concurring in Chambers v. Baltimore & O. R. R., 207 U.S. 142, 151, 28 S.Ct. 34, 53 L.Ed. 143 (1907) ; Currie and Schreter, Unconstitutional Discrimination in the Conflict of Laws: Equal Protection, 28 U.Chi.L.Rev. 1, 14 n. 70 (1960).

20 . In Perkins v. Benguet Consolidated Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952), where the obligation did not so arise, the quantum of corporate activity was exceptionally large, the state having become the corporation’s wartime headquarters.

21 . In this respect Arrowsmith’s case is weaker than the plaintiff’s in New York Times Co. v. Sullivan, supra, where Sullivan, a resident and public official of Alabama, alleged that the libel had been circulated in that state and had injured his reputation there.