UNITED STATES SUPREME COURT FURTHER LIMITS GENERAL PERSONAL JURISDICTION

In 3 recent opinions, the United States Supreme Court has undeniably confirmed that general jurisdiction is only appropriate in a forum where a defendant is either incorporated or headquartered (aka, “at home”).  These decisions come on the heels of the decisions that set the foundations for the new era of personal jurisdiction, Goodyear v. Brown and Daimler v. Bauman.

The first of these new cases, TC Heartland LLC v. Kraft Foods Grp. Brands LLC, required that patent infringement claims be filed where the defendant is incorporated.  The second case, BNSF Railway Co. v. Tyrell, required that FELA cases be filed where the defendant is “at home”.

Finally, on June 19th, the United Supreme Court reversed a California Supreme Court decision and held in Bristol-Myers Squibb v. Superior Court, that plaintiffs must file tort cases where a defendant is “at home”.  In Bristol-Myers Squibb, the California Supreme Court tortured the definition of specific jurisdiction in an effort to get around the law as set forth in Goodyear and Daimler.  The State court allowed an out of state plaintiff to sue the defendant in California although none of the activities giving rise to the plaintiff’s injury (such as sales or manufacturing) occurred there.  The only contact with California was the defendant’s nationwide marketing campaign.  The U.S. Supreme Court reversed the California Supreme Court and held, for the fifth time in six years, that a defendant is subject to general personal jurisdiction in the jurisdictions in which it is “at home,” otherwise articulated as where they are incorporated or headquartered.

Now that the dust has settled, it remains clear that specific jurisdiction, the jurisdiction where the tort was committed, is alive and well.  As such, a manufacturer may be sued in the forum where he sells the product and in which the plaintiff is injured by such product.  However, jurisdiction based on a defendant’s “continuous” presence in a State is no longer a sufficient basis for general jurisdiction.

The practical implication of this line of cases is that plaintiff’s may no longer file huge numbers of cases forums where potentially liable defendants have had continuous and systematic contacts.  They are left with two options:  1) they may go to each states where specific jurisdiction exists; or 2) they may file where a majority of the defendants are “at home”.  Where some states have been slow to recognize Daimler and have found excuses to circumvent it, that door is now firmly shut.  The days of forum shopping to friendly courts are simply over.

Friendly forums for plaintiffs in mass tort cases such as Madison County, Illinois, St. Louis, Missouri and the Southern District of New York may no longer be available because few defendants are “at home” there.  In her dissent, Justice Sotomayor actually observed that Delaware may be the only jurisdiction available to garner numerous defendants.

Read the full opinion here.

Chris Lee and Scott Reese

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