Gerling Global Reinsurance Corp. of America v. Gallagher

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT FILED
U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
OCTOBER 02, 2001
THOMAS K. KAHN
No. 00-16542 CLERK
________________________

D. C. Docket No. 99-00444-CV-4-RH

GERLING GLOBAL REINSURANCE
CORPORATION OF AMERICA, d.b.a.
GERLING GLOBAL REINSURANCE
CORPORATION-U.S. BRANCH, , GERLING
GLOBAL LIFE REINSURANCE COMPANY, etc., et al.,

Plaintiffs-Appellees,

versus

TOM GALLAGHER,

Defendant-Appellant.

________________________

Appeal from the United States District Court
for the Northern District of Florida
_________________________
(October 2, 2001)

Before CARNES and MARCUS, Circuit Judges, and PROPST*, District Judge.

*
Honorable Robert B. Propst, U.S. District Judge for the Northern District of Alabama,
sitting by designation.
MARCUS, Circuit Judge:

Defendant Tom Gallagher (the “Commissioner”), in his capacity as the

Insurance Commissioner of the State of Florida, appeals the district court’s entry of

summary judgment against him on the Plaintiffs’ challenge to the constitutionality

of Florida’s Holocaust Victims Insurance Act, Fla. Stat. § 626.9543 (the “Act”).

Plaintiffs -- several insurers operating in Florida with corporate affiliations to

German insurers who may have issued policies to Holocaust victims prior to 1945 -

- brought this suit alleging that the Act violates the Due Process Clause and other

provisions of the U.S. Constitution. The district court agreed that the Act violates

Due Process because it effectively regulates a subject and transactions that have an

insufficient connection with Florida. The court therefore granted summary

judgment in Plaintiffs’ favor, denied the Commissioner’s cross-motion for

summary judgment, and entered a narrow injunction relieving the Plaintiffs of any

consequences stemming from their refusal to comply with certain disclosure

obligations created by the Act and imposed via subpoenas. The Commissioner

now appeals, disputing the district court’s legal analysis. Because we agree that

this Act, as applied to these Plaintiffs on these facts, violates Due Process, we

affirm the district court, and uphold the limited remedy provided by that court. We

do not address the Plaintiffs’ other objections to the Act, and do not decide whether

2
other provisions of the Florida Insurance Code may in some circumstances

authorize this kind of inquiry into the affairs of an insurer’s affiliate.

I.

This action concerns Florida’s Holocaust Victims Insurance Act, which took

effect in 1998. The sole explicit purpose of the Act is to ensure that “potential and

actual insurance claims of Holocaust victims and their heirs and beneficiaries be

expeditiously identified and properly paid and that Holocaust victims and their

families receive appropriate assistance in the filing and payment of their rightful

claims.” Fla. Stat. § 626.9543(2). To that end, the Act includes a number of

provisions affecting the rights of German insurers and their German insureds under

policies issued in Germany between 1920 and 1945.1

The Act contains two key sets of provisions. The first set (the “reporting

provisions”) imposes a reporting requirement upon insurers doing business in

Florida (“Florida insurers”). Specifically,

[a]ny insurer doing business in this state shall have an
affirmative duty to ascertain to the extent possible and report to the
department within 90 days after the effective date of this section and
annually thereafter all efforts made and results of such efforts to
ascertain:

1
The Act does not limit its scope to German insurers or policies. It applies to any
insurers that issued policies to Holocaust victims. For ease of reference, insurance policies
issued between 1920 and 1945 to Holocaust victims shall be identified as “Holocaust-era
policies.”

3
 (a) Any legal relationship with an international insurer that
issued an insurance policy to a Holocaust victim between 1920 and
1945, inclusive.

(b) The number and total value of such policies.

(c) Any claim filed by a Holocaust victim, his or her
beneficiary, heir, or descendant that has been paid, denied payment, or
is pending.

(d) Attempts made by the insurer to locate the beneficiaries of
any such policies for which no claim of benefits has been made.

(e) An explanation of any denial or pending payment of a claim
to a Holocaust victim, his or her beneficiary, heir, or descendant.

Id. § 626.9543(7). As the text explains, a Florida insurer has a duty to report not

only regarding its own Holocaust-era policies, but also regarding the policies of

companies with which it has or had any “legal relationship.” The statute defines

“legal relationship” as “any parent, subsidiary, or affiliated company with an

insurer doing business in this state.” Id. § 626.9543(3).2 Violation of the reporting

requirement, or any other requirement imposed by the Act, subjects an insurer to

“an administrative penalty of $1,000 per day for each day such violation

continues.” Id. § 626.9543(9).

2
This definition is concededly not limited to the Florida insurer’s corporate “alter egos.”
Cf. The Moorings at Aberdeen Homeowners Ass’n v. UDC Homes, Inc., 673 So. 2d 981, 982
(Fla. Dist. Ct. App. 1996) (alter ego relationship alleged where one corporation “exerted its
control over” a related “sham” corporation and “caused the separate corporate identity of [the
sham corporation] to be ignored”).

4
 The second set of provisions (the “claims recovery provisions”), as

interpreted by the Commissioner in an administrative rule, requires Florida insurers

to pay all valid Holocaust-era policy claims asserted against them as well as all

valid claims asserted against any of their parents, subsidiaries, or corporate

affiliates. Fla. Stat. § 626.9543(5); Fla. Admin. Code 4-137.010(6). The Act

requires payment of all claims established under “a reasonable, not unduly

restrictive, standard of proof.” Fla. Stat. § 626.9543(5)(b). The Act also declares

inapplicable to Holocaust-era policy claims any foreign statute of limitations, and

creates a new ten-year statute of limitations for the presentation of these claims.

Id. § 626.9543(6).

In addition, the Act creates a private cause of action for individuals harmed

by a violation of the Act, and authorizes the recovery of treble damages, costs, and

attorney’s fees. Id. § 626.9543(10). This provision establishes a remedy for any

person alleging non-payment on a Holocaust-era policy by any insurer doing

business in Florida or by any parent, subsidiary, or corporate affiliate of such an

insurer. Accordingly, a Florida insurer could be liable for treble damages,

attorney’s fees, and costs based upon the non-payment of a Holocaust-era policy

by a separate foreign company that it does not control, but with which it happens to

be affiliated.

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 II.

Plaintiffs are six related insurers licensed to do business in Florida: Gerling

Global Reinsurance Corp. of America f/k/a Constitution Reinsurance, a New York

company; Gerling Global Reinsurance -- U.S. Branch, a German company; Gerling

Global Life Reinsurance, a California company; Gerling Global Life Insurance, a

Canadian company; Gerling America Insurance, a New York company; and

Constitution Insurance f/k/a Gerling Global, a New York company. There is no

suggestion that any Plaintiff issued any policies to Holocaust victims prior to 1945;

only one of the Plaintiffs was in existence, and that insurer did not become

affiliated with the Gerling group until much later.

Although not corporate alter egos and apparently not direct parents or

subsidiaries, the six Plaintiffs are affiliates of two German insurers,

Gerling-Konzern Lebensversicherungs-AG (“GKL”) and Gerling-Konzern

Allgemeine Versicherungs-AG (“GKA”), who issued Holocaust-era policies in

Germany. GKL and GKA are German companies based in Cologne; they are not

registered to do business in Florida, they have no offices or employees in the state,

and there is no evidence that these German insurers have any independent contacts

with Florida other than to the extent that some current Holocaust-era policyholders

or their beneficiaries may currently reside in the state. There is no record evidence

6
that the Plaintiffs have possession, custody, or “control” -- in the legal or practical

sense -- over the records or activities of GKL or GKA.

The trigger for this lawsuit was a set of subpoenas sent, under authority of

the Act and the implementing Rule, to five of the Plaintiffs by the Florida

Insurance Commissioner. The subpoenas are expansive, calling upon the Plaintiffs

to produce an array of records regarding any Holocaust-era policies issued not only

by the Plaintiffs themselves, but also by their German affiliates. The Plaintiffs had

previously advised the Florida Department of Insurance that none of them had

issued any policy that was in force in Europe between 1920 and 1945, and that they

could not provide information regarding GKL and GKA because they had no direct

knowledge of the activities of their German affiliates. The Plaintiffs did attach

copies of reports voluntarily supplied by GKL and GKA addressing some of the

matters covered by the Act’s reporting requirement; both GKL and GKA reported

that, to the extent relevant records remain, there is no indication of any unpaid

claims relating to the Holocaust era.

The Commissioner thought those responses inadequate. In the subpoenas,

therefore, he sought a wide range of documents, including copies of policies,

reinsurance contracts, checks, and financial statements, covering essentially all of

the German affiliates’ European transactions during a twenty-five year span early

7
last century. The subpoenas also defined the subpoenaed companies as including

as well “any and all other entities that . . . now have or have in the past had any

organizational, managerial, or operational connection with [them], including but

not limited to as a parent company or as a subsidiary.” The Commissioner then

issued a press release asserting that the subpoenas were issued because the

Plaintiffs had not fully complied with the Act.

Rather than contest the subpoenas, the Plaintiffs filed this lawsuit for

declaratory and injunctive relief. The complaint seeks relief under 42 U.S.C. §

1983 based on the Act’s alleged unconstitutionality. The Plaintiffs eventually

moved for summary judgment in their favor; the Commissioner cross-moved for

summary judgment in his favor.3

3
The parties disagree about whether the Plaintiffs raised an as-applied challenge in their
summary judgment motion. Although there is no question that the Plaintiffs were pursuing an
as-applied challenge in the lawsuit along with a facial challenge, it appears that the Plaintiffs’
summary judgment motion referred only to their facial challenge. Nevertheless, for a variety of
reasons, we will consider the Plaintiffs’ as-applied arguments in resolving this appeal. First, it is
well settled that “[w]hen reviewing a grant of summary judgment, the court of appeals may
affirm if there exists any adequate ground for doing so, regardless of whether it is the one on
which the district court relied.” Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1117 (11th Cir.
1993). Second, the Commissioner himself, by seeking summary judgment in his own right on all
issues raised by the complaint, effectively injected the as-applied issue into the summary
judgment mix. Third, the Plaintiffs’ entitlement to relief on the limited as-applied argument they
have advanced before us is sufficiently clear that no purpose would be served by a remand at this
stage. Finally, the Commissioner cannot persuasively claim any prejudice from considering
Plaintiffs’ as-applied argument now. The Commissioner had every opportunity to request further
discovery before the district court ruled on the summary judgment motions, yet he chose not to
do so. The Commissioner also chose not to contest Plaintiffs’ evidence asserting a lack of
control over the documents sought in the subpoenas. We therefore shall address the Plaintiffs’
as-applied challenge to the Act. Notably, although the district court’s order did not specify

8
 In an order dated November 11, 2000, the district court granted the

Plaintiffs’ motion and denied the Commissioner’s cross-motion. 123 F. Supp. 2d

1298 (N.D. Fla. 2000). The court did so on the basis of one of Plaintiffs’ asserted

objections: denial of Due Process. Relying on our opinion in American Charities

for Reasonable Fundraising Regulation, Inc. v. Pinellas County, 221 F.3d 1211

(11th Cir. 2000), the court initially explained that the Act “is subject to review

under the jurisdictional principles of the Due Process Clause and may be enforced

only to the extent consistent with those principles.” 123 F. Supp. 2d at 1302. The

district court then found that the Act reached too far by effectively attempting to

regulate the activities of insurers with no contact with Florida. According to the

court, “[t]he insurance contracts at issue were entered in Germany between German

parties under German law. They addressed German events. Any breach of the

contracts occurred in Germany. The parties to the contracts had no connection

with Florida. The events governed by the contracts had no connection with

Florida. The grounds for exercising jurisdiction over these parties or these events

in Florida are exactly none.” Id.

whether it was considering an as-applied challenge, the limited relief that it fashioned was
consistent with such a challenge.

9
 The district court made two other important observations in its opinion.

First, it assumed for purposes of its ruling that the Plaintiffs were subsidiaries of

GKL and GKA; it explained, however, that under well-settled law “the German

parents -- and their German transactions -- are not subject to the jurisdiction of the

State of Florida merely because the subsidiaries do business here.” Id. at 1303

(citing Consolidated Dev. Corp. v. Sherritt, Inc., 216 F.3d 128, 129 (11th Cir.

2000)). The court emphasized that even though the subpoenas were directed

toward the Florida insurers, “it is not plaintiffs’ transactions that the Commissioner

is investigating. The transactions at issue were instead entered solely by German

corporations of which plaintiffs are subsidiaries.” 123 F. Supp. 2d at 1303.

Second, the district court observed that there was no effort by the

Commissioner to justify the Act as necessary to facilitate the Department’s

regulation of the Florida insurers. According to the court:

It is true that in the course of regulating Florida insurers, the
Commissioner can and does properly consider events occurring
elsewhere. Thus, for example, if an insurer that does business in
Florida commits fraud in another state or country, the Commissioner
may properly consider whether that renders the insurer unfit to engage
in the business of insurance in Florida. There has been no assertion,
however, that any plaintiff had anything to do with any Holocaust-era
policies or with any failure to pay claims under any such policies.
Commendably, the Commissioner has made no effort to justify the
Holocaust Victims Insurance Act or his actions thereunder simply as a
means of determining whether plaintiffs themselves or their officers
are fit to engage in the business of insurance in Florida. Rather, the

10
 Commissioner has acknowledged, as the Act’s statement of purpose
makes clear, that the ultimate goal is to bring about payment of
amounts due to Holocaust victims and their families. See Transcript
of Summary Judgment Hearing [] (asserting that core of Act is
facilitating access of Florida Holocaust victims to information that
would allow them to perfect claims). And the Commissioner has said
he seeks information regarding amounts due to Florida residents only,
not regarding amounts owed to victims still in Germany or elsewhere,
see id. [], thus making clear that the goal is not simply to address the
current fitness of corporate officers (who presumably would be
equally unfit whether they failed to pay valid claims in Germany,
Florida or elsewhere) but, as the statute expressly states, to facilitate
the payment of claims.

Id. at 1303 n.9.

As relief, the district court directed entry of a judgment in Plaintiffs’ favor

and also issued an injunction. The court’s remedy did not sweep broadly,

providing no express declaratory relief and enjoining the Commissioner only from

taking any action against the Plaintiffs “as a result of their failure to provide

information or evidence to defendant relating to Holocaust-era policies issued by

insurers other than plaintiffs (whether or not such insurers were or are affiliates of

plaintiffs) outside of the State of Florida to insureds who were, at the time of

issuance of the policies, not Florida citizens or residents.” Id. at 1304. In other

words, the district court did not declare the entire Act unconstitutional, and

basically treated Plaintiffs’ argument as simply a narrow as-applied attack on the

reporting provisions to the extent those provisions exceed constitutional limits on

11
Florida’s legislative jurisdiction. The Commissioner has appealed the district

court’s order; the Plaintiffs have not cross-appealed.

III.

There is no dispute about the proper standard of review of the district court’s

order granting Plaintiffs’ motion for summary judgment and denying the

Commissioner’s cross-motion. We review a district court’s grant of summary

judgment de novo, applying the same legal standards used by the district court.

See, e.g., Hilburn v. Murata Elecs. N. Am., Inc., 181 F.3d 1220, 1225 (11th Cir.

1999). Summary judgment is appropriate where “there is no genuine issue as to

any material fact and the moving party is entitled to a judgment as a matter of law.”

Fed. R. Civ. P. 56(c). We “view the evidence and all factual inferences therefrom

in the light most favorable to the party opposing the motion” and “‘all reasonable

doubts about the facts [are] resolved in favor of the non-movant.’” See Burton v.

City of Belle Glade, 178 F.3d 1175, 1187 (11th Cir. 1999) (quoting Clemons v.

Dougherty County, 684 F.2d 1365, 1368-69 (11th Cir. 1982)).

IV.

Plaintiffs contend that the Act is unconstitutional on its face and as applied.

They assert primarily that the Act violates the Due Process Clause of the

Fourteenth Amendment because (1) the Florida Legislature lacked “legislative

12
jurisdiction” to regulate, in effect, the affairs of the Plaintiffs’ German affiliates;

(2) the Act compels the Plaintiffs or their affiliates to violate German law; and (3)

the act is arbitrary and irrational as applied. Plaintiffs also contend that the Act

violates the dormant Commerce Clause by impermissibly regulating out-of-state

commerce; violates Congress’s power to control international commerce and the

national government’s foreign affairs power under Zschernig v. Miller, 389 U.S.

429, 88 S. Ct. 664 (1968); would authorize an unreasonable search and seizure in

violation of the Fourth Amendment; and constitutes a bill of attainder.4 The

Commissioner disputes all of these contentions. In addition, the Commissioner

contends that the validity of the Act’s claims recovery provisions cannot be

addressed in this proceeding because there is no “case or controversy” regarding

the applicability of these provisions to the Plaintiffs and because these provisions

are severable from the Act’s reporting provisions.

The relief ordered by the district court was limited to the Act’s reporting

provisions to the extent they affect these six Plaintiffs. The Plaintiffs have not

4
The United States has intervened on behalf of the Plaintiffs, arguing that the district
court’s ruling should be affirmed because the Act violates the dormant Commerce Clause as well
as the foreign affairs power. The Government particularly emphasizes the disruptive effect that
the Act (in its view) will have on the operation of carefully-crafted international initiatives to
provide insurance benefits to Holocaust victims and their survivors. The Government has not
taken a position on Plaintiffs’ Due Process objections. We do not imply any view on the merits
of the Government’s arguments, because it is unnecessary to consider them.

13
cross-appealed from that limited relief. Accordingly, because the relief ordered by

the district court concerned only the reporting requirements, and in light of our

holding in this opinion, we have no occasion to consider the Act’s claims recovery

provisions, and therefore do not offer any view on the constitutionality of those

provisions, whether there currently exists a case or controversy regarding those

provisions, or whether those provisions are severable from the reporting

provisions. The only issue before us, and the only issue which we resolve today, is

extremely narrow, and concerns solely the validity of the Act’s reporting

provisions in connection with the subpoenas served on these Plaintiffs by the

Commissioner.

Turning to that issue, the district court’s conclusion that the reporting

provisions are unconstitutional was based entirely on the concept of legislative Due

Process. The court found, as Plaintiffs contend, that there is an insufficient

connection between the State of Florida and the subject matter of the Act insofar as

the Act calls upon Florida insurers such as the Plaintiffs to produce and compile

information regarding transactions between non-Florida residents that occurred

entirely outside Florida. Plaintiffs argue that the reporting provisions, to the extent

they concern the Plaintiffs’ German affiliates and European transactions, exceed

the constitutionally permissible regulatory authority of the Florida Legislature.

14
The Plaintiffs also contend that the provisions are invalid as applied because,

regardless of whether the Plaintiffs have a “legal relationship” with their German

affiliates, they do not have possession, custody or control over the sought-after

materials, and where such control is lacking they cannot constitutionally be

compelled to produce the materials.

The concept of substantive Due Process limits on a state legislature’s

jurisdiction was recently considered by this Court in American Charities for

Reasonable Fundraising Regulation, Inc. v. Pinellas County, 221 F.3d 1211 (11th

Cir. 2000). That case involved a county ordinance regulating persons, wherever

located, who solicited or assisted with soliciting charitable contributions within the

county. The plaintiffs -- who assisted charities in sending national mailings

addressed to the general public -- brought suit challenging the ordinance on several

constitutional grounds, including denial of Due Process. Plaintiffs argued that they

could not constitutionally be subject to the ordinance because they had insufficient

contacts with the county and did not purposefully avail themselves of any benefits

in the county. The district court granted summary judgment against the plaintiffs.

On appeal, we affirmed the district court with respect to the plaintiffs’ facial

challenge, but reversed and remanded on plaintiffs’ as-applied Due Process

challenge. We held that the county’s application of the ordinance to the plaintiffs

15
“may violate the Due Process Clause of the Fourteenth Amendment.” Id. at 1214;

see also id. at 1217. In the course of our opinion, we framed the Due Process issue

in these terms:

A state’s legislative jurisdiction is circumscribed by the Due
Process Clause: There must be at least some minimal contact between
a State and the regulated subject before it can, consistently with the
requirements of due process, exercise legislative jurisdiction. The
inquiry into whether sufficient legislative jurisdiction exists is similar
to that explored in determining sufficient minimum contacts for the
purposes of assessing whether a court can exercise personal
jurisdiction consistent with due process, or whether a court can apply
a state’s own law under choice-of-law analysis to a case consistent
with due process.

To determine legislative jurisdiction, that is, to confirm that the
application of the County’s regulations to Plaintiffs does not offend
due process, we look to choice-of-law and personal jurisdiction
analyses. When choice-of-law issues arise in court, to apply a state’s
substantive law in accordance with due process, that State must have a
significant contact or significant aggregation of contacts, creating
state interests, such that choice of its law is neither arbitrary nor
fundamentally unfair. And, when a court is considering its personal
jurisdiction, the exercise of jurisdiction does not offend due process if
the pertinent party has certain minimum contacts with the jurisdiction
such that the maintenance of the action does not offend traditional
notions of fair play and substantial justice. Applying these standards
to the question before us now, we ask whether sufficient contacts exist
between the Plaintiffs and the County, creating state interests such that
it would not be fundamentally unfair to subject the Plaintiffs to the
County’s registration requirements. Therefore, a minimum contacts
inquiry is necessary for determining whether the County’s exercise of
legislative jurisdiction, in this case, offends due process. The
regulated party must have performed some act by which it
purposefully avails itself of the privilege of conducting activities
within the County.

16
Id. at 1216 (citations, internal quotation marks, and brackets omitted).

In Adventure Communications v. Kentucky Registry of Election Finance,

191 F.3d 429 (4th Cir. 1999), a decision cited by American Charities, the Fourth

Circuit elaborated on the limits on legislative jurisdiction:

[T]here is a difference between jurisdiction to adjudicate or judicial
jurisdiction on the one hand, and legislative jurisdiction on the other.
The former concerns the power of a state to resolve a particular
dispute through its court system, while the latter involves “the
authority of a state to make its law applicable to persons or activities.”
Legislative jurisdiction is a core concept “to determining the
extraterritorial reach of a statute.” To put it succinctly: Legislative
jurisdiction refers to both “the lawmaking power of a state” and “the
power of a state to apply its laws to any given set of facts,” whereas
adjudicative jurisdiction “is the power of a state to try a particular
action in its courts.”

Nevertheless, the concepts are closely related [and there] is
substantial overlap in the analysis employed in determining the
presence of each kind of jurisdiction. . . . In exploring the due process
limits on the legislative power of a state, the Supreme Court has
employed language similar to that used in personal jurisdiction
matters, explaining that “[t]here must be at least some minimal contact
between a State and the regulated subject before it can, consistently
with the requirements of due process, exercise legislative
jurisdiction.” . . . In sum, although not identical, judicial and
legislative jurisdiction are determined pursuant to like guidelines.

Id. at 435-36 (citations omitted).

The Plaintiffs argue that Florida’s Holocaust Victim’s Insurance Act violates

legislative Due Process constraints to the extent it calls for information about, and

thereby effectively seeks to regulate, European insurance transactions. Plaintiffs

17
contend that (1) the Holocaust-era policies were issued outside of Florida, (2) to

persons not then residing in Florida, (3) regarding persons or property outside of

Florida, and (4) are governed by German law. The Commissioner responds that

the Act does not apply to every insurer whether or not that insurer has contacts

with Florida; rather, technically speaking, the reporting obligation applies only to

insurers, such as these Plaintiffs, who do business in Florida. The Commissioner

contends that Florida insurers obviously have sufficient contacts with the State of

Florida to permit the Florida Legislature to inquire into their affairs.

On this record, we agree with Plaintiffs’ narrow argument that the statute’s

reporting provisions, as applied, violate legislative Due Process constraints. The

relevant question is whether there exists “some minimal contact between a State

and the regulated subject.” American Charities, 221 F.3d at 1216 (emphasis

added). In other words, we inquire not only into the contacts between the regulated

party and the state, but also into the contacts between the regulated subject matter

and the state. Id.; see also Allstate Ins. Co. v. Hague, 449 U.S. 302, 310-11, 101 S.

Ct. 633, 639 (1981) (addressing whether Due Process limited a state court’s ability

to apply its state law to a disputed insurance transaction and stating “the

proposition that if a State has only an insignificant contact with the parties and the

18
occurrence or transaction, application of its law is unconstitutional”) (emphasis

added).

The concept of Due Process constraints on a state legislature’s ability to

regulate subject matters and transactions beyond the state’s boundaries, while

perhaps infrequently litigated in those terms, is not new. It has been invoked in

controversies regarding a state’s power to tax transactions occurring in whole or

part outside its borders. See Quill Corp. v. North Dakota, 504 U.S. 298, 306, 112

S. Ct. 1904, 1910 (1992) (explaining that “[t]he Due Process Clause ‘requires some

definite link, some minimum connection, between a state and the person, property

or transaction it seeks to tax’”) (citation omitted). It has also been invoked in

choice of law disputes, as it was in Hague, 449 U.S. at 302, 110 S. Ct. at 639, and

earlier decisions.

In Home Insurance Co. v. Dick, 281 U.S. 397, 50 S. Ct. 338 (1930), for

example, the Supreme Court held that a Texas statute could not be applied in

litigation arising out of a subject matter with no connection to Texas. That case

involved a disagreement over the terms of an insurance policy which had been

issued in Mexico, by a Mexican insurer, to a Mexican citizen, covering a Mexican

risk. The policy was subsequently assigned to the plaintiff, who was domiciled in

Mexico. The policy restricted coverage to losses occurring in certain Mexican

19
waters, and the loss triggering the litigation occurred in those waters. The plaintiff

nevertheless brought suit in Texas against a New York reinsurer. Neither the

Mexican insurer nor the New York reinsurer had any connection to Texas.

The Texas courts applied a Texas statute to void the insurance contract’s

limitation clause, but the Supreme Court reversed, holding that the statute as

applied violated Due Process. As the Court explained:

The Texas statute as here construed and applied deprives the
garnishees of property without due process of law. A state may, of
course, prohibit and declare invalid the making of certain contracts
within its borders. Ordinarily, it may prohibit performance within its
borders, even of contracts validly made elsewhere, if they are required
to be performed within the state and their performance would violate
its laws. But, in the case at bar, nothing in any way relating to the
policy sued on, or to the contracts of reinsurance, was ever done or
required to be done in Texas. All acts relating to the making of the
policy were done in Mexico. All in relation to the making of the
contracts of reinsurance were done there or in New York. . . . Texas
was therefore without power to affect the terms of contracts so made.
Its attempt to impose a greater obligation than that agreed upon and to
seize property in payment of the imposed obligation violates the
guaranty against deprivation of property without due process of law.

Id. at 407-08, 50 S. Ct. at 341.

Likewise in Watson v. Employers Liability Assurance Corp., 348 U.S. 66,

75 S. Ct. 166 (1954), the Court invoked legislative Due Process principles to

evaluate a Louisiana insurance statute that purported to invalidate certain

provisions in insurance contracts entered out-of-state. Although the Court

20
eventually concluded that there were sufficient contacts between Louisiana and the

regulated subject matter to justify application of the state law on the facts before it,

the Court emphasized again “the due process principle that a state is without power

to exercise ‘extra territorial jurisdiction,’ that is, to regulate and control activities

wholly beyond its boundaries.” Id. at 70, 75 S. Ct. at 169. Simply put, as these

cases show, there must be at least some minimal contact between a state and the

regulated subject matter or transaction before the state can, consistent with the

requirements of Due Process, exercise legislative jurisdiction.

The subject of the Florida Legislature’s concern in the Holocaust Victims

Insurance Act is Holocaust-era insurance policies and the payment of claims still

due under those policies. While there may be a connection between the State of

Florida and that subject to the extent it relates directly to the activities of Florida

insurers, there is virtually no connection between the State of Florida and that

subject to the extent it concerns insurance transactions involving Plaintiffs’

German affiliates that took place years ago in Germany, among German residents,

under German law, relating to persons, property, and events in Germany.

Significantly, the reporting provisions are not on their face limited to information

regarding policies that allegedly may be payable to current Florida residents.

21
 Nor is there any dispute that Plaintiffs’ German affiliates do not conduct

business in Florida and have not otherwise purposefully availed themselves of

benefits provided by Florida. See American Charities, 221 F.3d at 1216 (“The

regulated party must have performed some act by which it ‘purposefully avails

itself of the privilege of conducting activities within the [state.]’”) (citation

omitted). The reporting provisions pertain to, and as a practical matter

unquestionably seek to regulate, a subject matter -- the German affiliates’ payment

or non-payment of Holocaust-era policy claims -- with no jurisdictionally-

significant relationship to Florida. The reporting provisions violate Due Process to

that extent, regardless of whether there are minimum contacts between the State of

Florida and these particular Plaintiffs, the (nominally) regulated parties.5

The purpose of the Act underscores why we must look not only at whether

the parties regulated by the Act have contacts with Florida, but also and more

importantly here at whether the subject about which this Act seeks information has

a sufficient nexus to Florida. In the Act itself the Legislature states its purpose as

ensuring that “potential and actual insurance claims of Holocaust victims and their

5
The Commissioner cites United States v. Morton Salt Co., 338 U.S. 632, 70 S. Ct. 357
(1950) and other cases for the proposition that the jurisdiction of an administrative agency is
greater than that of a court. The cases cited by the Commissioner do not sweep so broadly or
alter the Due Process inquiry we must undertake; at best, they establish that an investigating
agency may in some instances have powers to gather information broader than those available to
courts.

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heirs and beneficiaries be expeditiously identified and properly paid and that

Holocaust victims and their families receive appropriate assistance in the filing and

payment of their rightful claims.” Fla. Stat. § 626.9543(2). The express purpose

of the Act, while important, clearly goes far beyond regulating the activities of

insurers with contacts to Florida.

The Commissioner attempts to avoid that fact by arguing that the purpose of

the reporting requirement is fundamentally to regulate Florida insurers, as opposed

to their European affiliates. The Commissioner asserts that the Legislature acted

pursuant to its legitimate interest in seeing that insurers doing business in Florida

“pay just claims.” But that rationale plainly does not justify imposing on Florida

insurers intrusive and burdensome demands for information about the payment of

Holocaust-related claims by insurers not doing business in Florida who concededly

lack any independent contacts with Florida.6

6
In a supplemental brief served on the eve of oral argument, the Commissioner argued
that legislative jurisdiction exists, under principles applied in the personal jurisdiction context,
because the unlawful failure of foreign insurers to pay Holocaust-era claims has caused direct
effects in Florida and because denials of benefits or claims information have been made to
current Florida residents. No record evidence supports those contentions with regard to these
Plaintiffs. Moreover, as Plaintiffs point out (in an argument the Commissioner does not
controvert), case law undermines the Commissioner’s implicit assumption that a post-transaction
change of residence by policy claimants or their beneficiaries may create a jurisdictionally-
significant contact. See, e.g., McCluney v. Jos. Schlitz Brewing Co., 649 F.2d 578, 583 (8th Cir.
1981) (citing Hague and John Hancock Mut. Life Ins. Co. v. Yates, 299 U.S. 178, 57 S. Ct. 129
(1936)); cf. Hanson v. Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 1239 (1958) (“The unilateral
activity of those who claim some relationship with a nonresident defendant cannot satisfy the
requirement of contact with the forum State.”); Rambo v. American Southern Ins. Co., 839 F.2d

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 The Commissioner also contends that production of information regarding

potential Holocaust-era claims against a Florida insurer’s affiliates is necessary to

confirm the claims payment practices, solvency, and “good character” of the

Florida insurer.7 The Commissioner makes this contention even though the

General Counsel of the Department of Insurance squarely articulated to the district

court at the summary judgment hearing the Commissioner’s view that “[t]he

purpose of the [Act] is to make sure that Florida citizens, who are potential

beneficiaries [under these policies], have the maximum ability to have the

documentation to receive the redress they are entitled to.” Transcript of Hrg., Mar.

3, 2000, at 43.

The Commissioner’s position in this appeal regarding the purpose of the Act

cannot be squared with the Legislature’s own unequivocal statement of its purpose.

1415, 1420 (10th Cir. 1988) (plaintiffs’ change of residence after disputed insurance policy was
issued and the claim arose insufficient to support personal jurisdiction in plaintiffs’ new state).
The Commissioner’s arguments, on this record, are unpersuasive.
7
Plaintiffs maintain that this justification was never offered below. The Commissioner
insists that he argued this justification in his summary judgment papers, but having reviewed the
record it is clear that such a justification was not advanced in a meaningful way. Notably, there
is no evidence in this record that the Plaintiffs would suffer adverse financial consequences
(sufficiently material to affect their ability to pay ordinary Florida claimants) as a result of any
remaining Holocaust-era liabilities on the part of foreign insurers with which they merely have
some indirect “legal relationship.” Nor is there any evidence of a connection between the
current claims-handling practices of these Plaintiffs in Florida and their affiliates’ payment or
non-payment of Holocaust-era claims. All of these considerations weigh against the
Commissioner’s position on appeal.

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The sole express purpose of the Holocaust Victims Insurance Act does not

demonstrate a concern with the good character, solvency, or present payment

practices of Florida insurers; indeed, the Legislature’s inclusion of the claims

recovery provisions in the same statute itself belies any suggestion that the

reporting provisions are really intended to protect ordinary policyholders by

monitoring the exposure and financial sufficiency of Florida insurers. Rather, as

quoted above, the Legislature described the purpose of the Act as ensuring that

“potential and actual insurance claims of Holocaust victims and their heirs and

beneficiaries be expeditiously identified and properly paid and that Holocaust

victims and their families receive appropriate assistance in the filing and payment

of their rightful claims.” Fla. Stat. § 626.9543(2).

We have often emphasized in other contexts that the focal point for

determining a legislature’s purpose in enacting a particular statute must be the

plain language of the statute itself. See, e.g., Church of Scientology Flag Serv.

Org., Inc. v. City of Clearwater, 2 F.3d 1514, 1527 (11th Cir. 1993) (“Inquiry into

legislative purpose begins with interpreting the law itself.”). The express purpose

of the Act reaches well beyond determining the fitness and potential financial

liabilities of Florida insurers; indeed, it has little or nothing to do with that subject.

We are unwilling to ignore the Florida Legislature’s clear statutory statement of

25
purpose in favor of the Commissioner’s litigating position (which the Legislature

did not endorse in § 626.9543), and the Commissioner offers us no case law or

persuasive authority upon which we might do so.

We do not mean to say that the Commissioner is necessarily without

authority to investigate and obtain records regarding the practices of affiliates of

Florida insurers. On the contrary, separate provisions of the Florida Insurance

Code may well give the Commissioner authority to conduct far-reaching inquiries

into the affairs of a Florida insurer’s affiliates in order to determine whether the

Florida insurer is fit to do business in the state. For example, Fla. Stat. § 624.316

directs the Commissioner to examine “the affairs, transactions, accounts, records,

and assets” of Florida insurers, and advises that as part of this process the

Commissioner may also examine “the affairs . . . and records relating directly or

indirectly to the insurer and of the assets of the insurer’s managing general agents

and controlling or controlled person.” Fla. Stat. § 624.316(1)(a). The statute

further provides that these examinations may be conducted whenever warranted

“for the protection of the policyholders and in the public interest,” and may

encompass past events “that affect[] the present financial condition of the insurer.”

Id.

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 We offer no view as to whether these provisions (which the Commissioner

does not even invoke) might have authorized the subpoenas served by the

Commissioner in this case; nor do we offer any view regarding the constitutionality

of invoking those provisions in this context. Certainly these provisions fit more

closely with the purpose now asserted by the Commissioner, and that fact may well

affect the Due Process analysis. But the critical point is that these subpoenas were

issued in furtherance of an investigation under the Holocaust Victims Insurance

Act, and that Act is not concerned with the financial stability or fitness of insurers

doing business in Florida; it plainly is designed to facilitate the payment of

Holocaust-era policy claims.

In short, the district court correctly reasoned that, to the extent the Act calls

for the production of information by these Plaintiffs regarding Holocaust-era

policies issued outside Florida by German entities having only some corporate

affiliation with them and no other contacts to Florida, it violates Due Process limits

on legislative jurisdiction. The Act’s reporting provisions violate Due Process as

applied to these Plaintiffs on these facts. We therefore uphold the district court’s

entry of summary judgment in Plaintiffs’ favor and leave in place the limited

injunction that it issued against the Commissioner. We do not, and need not,

address the Plaintiffs’ other arguments for declaring the Act unconstitutional, and

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do not, as explained above, consider the Act’s claims recovery provisions,

Plaintiffs’ entitlement to any relief beyond that ordered by the district court, or the

Commissioner’s ability to obtain this information pursuant to other provisions of

the Florida Insurance Code.

AFFIRMED.

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