Monday, June 19, 2017

Another SCOTUS Decision on Personal Jurisdiction: Bristol-Myers Squibb v. Superior Court

Today the Supreme Court issued its decision in Bristol-Myers Squibb Co. v. Superior Court, covered earlier here and here. By an 8-1 vote, the Court reverses the California Supreme Court’s conclusion that asserting personal jurisdiction over Bristol-Myers Squibb (BMS) was constitutional. Justice Alito writes the majority opinion, joined by Chief Justice Roberts and Justices Kennedy, Thomas, Ginsburg, Breyer, Kagan and Gorsuch. Justice Sotomayor is the lone dissenter.

The case involves a “group of plaintiffs—consisting of 86 California residents and 592 residents from 33 other States”—who sued BMS in California state court alleging injuries arising from BMS’s drug Plavix. The issue was whether personal jurisdiction was proper over the claims by plaintiffs who were not residents of California. The California Supreme Court concluded that although BMS was not subject to general jurisdiction in California, the nonresidents’ claims were covered by specific jurisdiction.

Justice Alito’s majority opinion concludes that “the California courts cannot claim specific jurisdiction.” Addressing the basic requirements for specific jurisdiction, he writes:

In order for a state court to exercise specific jurisdiction, “the suit” must “aris[e] out of or relat[e] to the defendant’s contacts with the forum.” Id., at ___ (slip op., at 8) (internal quotation marks omitted; emphasis added); see Burger King Corp. v. Rudzewicz, 471 U. S. 462, 472–473 (1985); Helicopteros Nacionales de Colombia, S. A. v. Hall, 466 U. S. 408, 414 (1984). In other words, there must be “an affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State and is therefore subject to the State’s regulation.” Goodyear, 564 U. S., at 919 (internal quotation marks and brackets omitted). For this reason, “specific jurisdiction is confined to adjudication of issues deriving from, or connected with, the very controversy that establishes jurisdiction.” Ibid. (internal quotation marks omitted).

Justice Alito rejects the California Supreme Court’s “sliding scale” approach, under which (as he describes it) “the strength of the requisite connection between the forum and the specific claims at issue is relaxed if the defendant has extensive forum contacts that are unrelated to those claims.” He writes: “Our cases provide no support for this approach, which resembles a loose and spurious form of general jurisdiction.”

Regarding the fact that California residents were also plaintiffs in the Plavix litigation, Justice Alito writes:

The mere fact that other plaintiffs were prescribed, obtained, and ingested Plavix in California— and allegedly sustained the same injuries as did the nonresidents—does not allow the State to assert specific jurisdiction over the nonresidents’ claims. As we have explained, “a defendant’s relationship with a . . . third party, standing alone, is an insufficient basis for jurisdiction.” Walden, 571 U. S., at ___ (slip op., at 8). This remains true even when third parties (here, the plaintiffs who reside in California) can bring claims similar to those brought by the nonresidents. Nor is it sufficient—or even relevant—that BMS conducted research in California on matters unrelated to Plavix. What is needed—and what is missing here—is a connection between the forum and the specific claims at issue.

At the end of the opinion, Justice Alito briefly addresses the broader ramifications of the Court’s approach:

Our decision does not prevent the California and out-of-state plaintiffs from joining together in a consolidated action in the States that have general jurisdiction over BMS. BMS concedes that such suits could be brought in either New York or Delaware. See Brief for Petitioner 13. Alternatively, the plaintiffs who are residents of a particular State—for example, the 92 plaintiffs from Texas and the 71 from Ohio—could proba­bly sue together in their home States. In addition, since our decision concerns the due process limits on the exer­cise of specific jurisdiction by a State, we leave open the question whether the Fifth Amendment imposes the same restrictions on the exercise of personal jurisdiction by a federal court. See Omni Capital Int’l, Ltd. v. Rudolf Wolff & Co., 484 U. S. 97, 102, n. 5 (1987).

In dissent, Justice Sotomayor argues that specific jurisdiction was appropriate because even the nonresidents’ claims “‘relate to’ Bristol-Myers’ in-state conduct.” She explains:

A claim “relates to” a defendant’s forum conduct if it has a “connect[ion] with” that conduct. International Shoe, 326 U. S., at 319. So respondents could not, for instance, hale Bristol-Myers into court in California for negligently maintaining the sidewalk outside its New York headquarters—a claim that has no connection to acts Bristol-Myers took in California. But respondents’ claims against Bristol-Myers look nothing like such a claim. Respondents’ claims against Bristol-Myers concern conduct materially identical to acts the company took in California: its marketing and distribution of Plavix, which it undertook on a nationwide basis in all 50 States. That respondents were allegedly injured by this nationwide course of conduct in Indiana, Oklahoma, and Texas, and not California, does not mean that their claims do not “relate to” the advertising and distribution efforts that Bristol-Myers undertook in that State. All of the plaintiffs—residents and nonresidents alike—allege that they were injured by the same essential acts. Our cases require no connection more direct than that.

Justice Sotomayor observes that the majority does not go so far as to impose “a rigid requirement that a defendant’s in-state conduct must actually cause a plaintiff’s claim,” and it leaves open the extent to which its reasoning “would also apply to a class action in which a plaintiff injured in the forum State seeks to represent a nationwide class of plaintiffs, not all of whom were injured there.” She expresses concern, however, that the majority’s opinion “will make it profoundly difficult for plaintiffs who are injured in different States by a defendant’s nationwide course of conduct to sue that defendant in a single, consolidated action” and “may make it impossible to bring certain mass actions at all.”

Download Bristol Myers v. Superior Court 16-466

 

 

 

http://lawprofessors.typepad.com/civpro/2017/06/another-scotus-decision-on-personal-jurisdiction-bristol-myers-squibb-v-superior-court.html

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