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COHEN v. COMMODITY CREDIT CORPORATION

May 7, 1959

BERNARD S. COHEN, PLAINTIFF,
v.
COMMODITY CREDIT CORPORATION, A CORPORATION, DEFENDANT.



The opinion of the court was delivered by: John E. Miller, Chief Judge.

There is before the court defendant's original motion to dismiss and amendment thereto for lack of jurisdiction on the ground that service of process herein was insufficient to comply with Rule 4(d)(3), (d)(5) and (f), F.R.Civ.P., 28 U.S.C.A. The amendment to the motion was filed before the court had ruled upon the original motion to dismiss, and in the amendment to the motion it was alleged that the court lacked jurisdiction upon the further ground that the plaintiff was not on the day of filing the complaint a resident of the Western District of Arkansas and not then engaged in business in that District.

The plaintiff filed his complaint herein on October 12, 1958, against the defendant, Commodity Credit Corporation. He alleged, in general, that he had submitted a bid to the defendant for the purchase of certain cotton and that on March 27, 1957, his bid was accepted, thus creating a valid and binding contract between the parties; but that thereafter, when the time for performance arrived, the defendant refused to deliver the cotton or honor the contract. He alleged that by reason of the breach he was damaged in the sum of $5,136,200 and prayed judgment in that amount. The detailed allegations are not germane to the issues now before the court.

Upon filing the complaint process was issued against and thereafter served upon the United States Attorney for the Western District of Arkansas, the Attorney General, and the Deputy General Counsel for the United States Department of Agriculture at Washington, D.C.

On April 8, 1959, the plaintiff obtained proper service of process upon Mr. Clyde P. Lieblong in Little Rock, Arkansas. Mr. Lieblong is the designated agent for service of process in Arkansas in actions against the Commodity Credit Corporation.

No question has been raised by the defendant as to the present sufficiency of the service of process. The only question now before the court is whether the venue is properly laid or whether jurisdictional requirements based upon the plaintiff's residence are met.

Title 15 U.S.C.A. § 714b(c), provides in part:

    "Any suit against the Corporation shall be brought
  in the District of Columbia, or in the district
  wherein the plaintiff resides or is engaged in
  business."

The defendant raises the factual question of whether or not the plaintiff at the time of filing the complaint resided or was doing business in the Western District of Arkansas. Before that question is reached, however, a preliminary question is raised by the parties on the issue of whether the statutory provision is jurisdictional or relates merely to venue. The defendant asserts that it is jurisdictional and that the failure of the plaintiff to plead jurisdictional facts, i.e., that he resided in the district, renders his complaint subject to dismissal. The plaintiff asserts that the statute relates to venue only and that, accordingly, as he is not obligated to plead venue, his complaint is good. He further argues that since the statute is one of venue only, the defendant has the burden of showing that venue is improper.

The parties treat the issue as significant and for that reason, although it is not necessarily dispositive, it is dealt with here.

The defendant, relying upon the governmental immunity which cloaks Commodity, asserts, properly, that statutory restrictions placed upon suits against the government or any agency thereof are jurisdictional, since the government may be sued only to the extent to which it so consents. This issue appears to be settled. In United States v. Sherwood, 1941, 312 U.S. 584, at page 586, 61 S.Ct. 767, at page 769, 85 L.Ed. 1058, the court said:

    "The United States, as sovereign, is immune from
  suit, save as it consents to be sued [citing cases],
  and the terms of its consent to be sued in any court
  define that Court's jurisdiction to entertain the
  suit."

Furthermore, "limitations and conditions upon which the Government consents to be sued must be strictly observed and exceptions thereto are not to be implied." Soriano v. United States, 1957, 352 U.S. 270, 276, 77 S.Ct. 269, 273, 1 L.Ed.2d 306.

Confronted with such a rule the court would have to hold the statute jurisdictional where it prescribes conditions to suit without specifying whether such conditions were of a jurisdictional nature or were merely provisions for venue. That result would be compelled here except for a clear statement of Congressional intent found in the Report of the Subcommittee of the Committee on Agriculture and Forestry analyzing the provision in question. The Committee said:

    "The venue of suits against the Corporation is
  established in the District of Columbia, or in the
  district in which the plaintiff resides or is ...

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