Vanishing Venue: Poof! And You Lose by Stephen Brown

I.  Disparate Results for Similarly Situated Plaintiffs

Imagine two plaintiffs in Georgia, Alice and Belinda, with very similar claims.  Alice was injured by a product that was manufactured and sold in Fulton County, Georgia.  Belinda was injured by a similar product, which was manufactured in Fulton County, but which was sold in nearby de Kalb County.  Both plaintiffs live in Fulton County and were injured in Fulton County.  Alice sues both the seller and the manufacturer as joint tortfeasors in Fulton County, as that is the only county where she may sue.[1] Belinda, who may sue in either Fulton County or de Kalb County,[2] decides to sue both defendants in Fulton County, since that is where she lives.

Although it was not immediately apparent at the time that their suits began, it becomes clear during the course of their respective trials that the defect in these products arose in the hands of the sellers, not the manufacturer.  Thus, the Fulton County Court relieves the manufacturers of all liability in both Alice’s and Belinda’s cases.  That presents no problem for Alice, as long as the seller is solvent—the Fulton County Court can still enter judgment against the seller for Alice’s injuries, since her seller is located in Fulton County.  Belinda, however, is not so lucky: because of a peculiar oddity of Georgia jurisdictional law known as “vanishing venue,”[3] the Fulton County Court is unable to enter judgment against the seller, who is from de Kalb County, because the only defendant from Fulton County has been released from liability.[4] If Belinda is to recover, she will have to start over with a new trial in de Kalb County, despite having already litigated her claim on the merits.

These two plaintiffs are similarly situated; the disparity in their treatment results solely from their defendants’ status as either residing in the same county or multiple counties.  Further, plaintiffs with defendants from multiple counties must wait until the end of their trial to determine whether the court that conducted their trial will be able to enter a valid judgment.  For these reasons, this blog entry suggests that courts should seriously question the constitutionality of the doctrine giving rise to these unfair results.

II.  Vanishing Venue Runs Afoul of Equal Protection

Under the rule of vanishing venue, which has origins as early as 1903,[5] if a plaintiff sues multiple defendants who reside in multiple counties, and all of the defendants who reside in the forum county are discharged from liability, then venue automatically becomes improper against all the remaining defendants,[6] and therefore any judgment against them becomes invalid.[7] Thus, a plaintiff can take his case against several defendants to trial, win against all the nonresident defendants, but lose against all the resident defendants, and therefore see the result “vanish” as to the nonresident defendants.[8]

This rule unfairly treats two classes of similarly situated plaintiffs differently without any obvious justification.  As such, it may run afoul of the Equal Protection Clause of the Fourteenth Amendment to the U.S. Constitution, which forbids any state from “deny[ing] to any person within its jurisdiction the equal protection of the laws.”[9] The central purposes of the Equal Protection Clause are to ensure that “all persons similarly situated should be treated alike[,]”[10] and that the state “not draw distinctions between individuals based solely on differences that are irrelevant to a legitimate governmental objective[.]”[11] Thus, to establish a claim under this Amendment, a Plaintiff generally must allege (1) that he is a member of an identifiable group and the State treated him differently from similarly situated persons based on such membership, and (2) the statute or regulation classifying him is not rationally related to a legitimate government purpose.[12] It is noteworthy, however, that under Corbitt v. New Jersey,[13] “equal protection does not free those who made a bad assessment of risks or a bad choice from the consequences of their decision.”[14]

The vanishing venue doctrine, as codified at O.C.G.A. § 9-10-31(d), creates two identifiable class of plaintiffs, and treats them differently from other similarly situated plaintiffs.  Where a plaintiff has colorable claims against multiple defendants who cannot reasonably be sued separately (in this blog entry I’ll call that a “CMCS plaintiff”), this statute offers different treatment to CMCS plaintiffs based solely on the residence of the entities against whom these plaintiffs have colorable claims.

Where a CMCS plaintiff’s colorable claims are against defendants who all reside in the same county, O.C.G.A. § 9-10-31(d) creates no problem for venue—venue will almost surely be proper in the county in which the all the defendants reside.  This will allow the plaintiff to sue in that county with confidence that if the court returns a verdict against any of those defendants, jurisdiction will be proper and that court may simply enter judgment.

On the other hand, where a CMCS plaintiff’s colorable claims are against defendants residing in multiple counties, then O.C.G.A. § 9-10-31(d) would cause the plaintiff to risk invalidation of his entire suit in whatever county he sues in, depending on which defendant(s) he wins or loses against.  In a situation where the defendants reside in multiple counties and the plaintiff cannot reasonably sue them separately, a CMCS plaintiff is in a catch 22.  No matter which county he sues the multiple defendants in, a verdict he wins against some defendants will be invalid under the new-trial interpretation if the plaintiff loses against all the resident defendants.  Such a risk is totally absent in the case where a CMCS plaintiff sues defendants who all reside in the same county.

There is no obvious “legitimate legislative purpose” that this is “rationally related to.”  The closest such purpose that comes to mind is that the state may be trying to save defendants from having to defend in inconvenient venues, but that purpose is not served at all here: by the time venue is declared invalid, the defendant has already defended in that inconvenient venue.

III.  Vanishing Venue Does Not Fit into the Corbitt Exception to Equal Protection Cases

The U.S. Supreme Court in Corbitt v. New Jersey held that “equal protection does not free those who made a bad assessment of risks or a bad choice from the consequences of their decision.”[15] In Corbitt, the Supreme Court found no equal protection violation where a New Jersey sentencing scheme allowed more severe sentencing where criminal defendant elects to exercise his right to a jury trial rather than pleading guilty.[16] The court reasoned that the defendant knew that each defense strategy carried a multitude of possible outcomes and the defendant freely chose from among them.[17] Thus, the Supreme Court, in determining whether an Equal Protection Clause violation exists, seems to consider relevant whether the Plaintiff freely chose from among several litigation strategies, knowing that each strategy carried attendant risks. This holding has only been interpreted in criminal or quasi-criminal contexts.[18] Nonetheless, the general notion that one who makes an informed choice regarding litigation strategy should not be able to claim an Equal Protection violation in the case of an unfavorable result, seems to fit civil cases.  Courts have not interpreted the holding in Corbitt frequently enough, however, to provide specific guidelines for determining whether a litigant’s choice of strategy was the reason for his unfavorable result.

The definition of a CMCS plaintiff takes the Corbitt limitation into account, however.  If a plaintiff really has sufficiently colorable claims against multiple defendants who cannot reasonably be sued separately, then he cannot be said to have a reasonable choice among litigation strategies.  If the plaintiff simply joins a party for the purpose of obtaining favorable venue, yet is aware he is unlikely to prevail against that party, or could have litigated multiple trials against the several defendants in their respective counties, then an unfavorable vanishing venue could reasonably be said to result from the plaintiff’s litigation strategy.  However, in a case where the defendants or the court moved for joinder of third party defendants because justice could not be served without their presence, or where a plaintiff sues a broad class of defendants who reside in many counties, or other like scenarios, it would be inappropriate to say that the plaintiff exercised a choice among different litigation strategies.  The precise bounds of the factual inquiry as to whether a plaintiff’s unfavorable result is due to a poor litigation strategy do not detailed in existing case law.