In the wake of the Supreme Court’s decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), generic pharmaceutical defendants may argue that they are only subject to personal jurisdiction in their own backyards – i.e., where they are incorporated or have their principal places of business. But, Daimler is not so broad, and does not change the decade of cases that have found generic defendants subject to general personal jurisdiction in various forums around the country based on sales in those places. Indeed, Daimler itself explained that it was not enacting a sweeping change in the law, instead explaining that “the canonical opinion in this area remains International Shoe Co. v. Washington, 326 U.S. 310.” Daimler 134 S. Ct. at 754.
Instead, Daimler dealt only with the narrow issue of whether “consistent with the Due Process Clause of the Fourteenth Amendment, Daimler is amenable to suit in California courts for claims involving only foreign plaintiffs and conduct occurring entirely abroad.” Daimler, 134 S. Ct. at 751. Specifically, in Daimler, relatives of victims of alleged atrocities committed in the 1970s and 1980s in Argentina brought a cause of action against Daimler-Chrysler Aktiengesellschaft (“Daimler”) under the Alien Tort Statute alleging that Daimler’s Argentinian subsidiary, Mercedes-Benz Argentina, collaborated in kidnapping, torturing, and killing the plaintiff’s relatives. Id. at 751. The plaintiffs brought the cause of action in California, alleging that the contacts of Daimler’s U.S. subsidiary, Mercedes-Benz USA, in California subjected Daimler to general personal jurisdiction there. Id. at 752. The Supreme Court found that Daimler was not subject to general personal jurisdiction on an agency theory based on Mercedes-Benz USA’s contacts in California. Id. at 763.
The facts of Daimler are thus vastly different than the facts of any Hatch-Waxman litigation. And, where a generic pharmaceutical defendant sells millions of dollars of products into a state, taking advantage of the benefits of the forum’s laws, they should be subject to general personal jurisdiction there.
Moreover, branded pharmaceutical companies should consider arguing that a generic pharmaceutical company is subject to specific personal jurisdiction based on their anticipated future activities in the forum. Given that the Hatch-Waxman Act creates a cause of action wherein infringement is analyzed based on what the generic defendant is expected to sell, shouldn’t the analysis of specific personal jurisdiction also look at where the generic is expected to make those sales? Although no court has yet addressed that issue, it represents another potential avenue to combat the argument that a generic defendant in an ANDA case is only subject to jurisdiction in its home forum.