On June 19, the United States Supreme reaffirmed some basic principles of personal jurisdiction in Bristol-Meyers Squibb Co. v. Superior Court of California, 528 U.S. __ (2017). In a bloody-good 8-1 decision (with only Justice Sotomayor dissenting) the United States Supreme Court reversed a decision of the California Supreme Court that had affirmed California’s exercise of personal jurisdiction over BMS, a foreign corporation, in a series of lawsuits brought by individuals alleging personal injuries from the ingestion of Plavix, a prescription blood-thinning drug manufactured and sold by BMS.
The California Supreme Court affirmed the California Superior Court’s exercise of personal jurisdiction over BMS despite the facts that 592 of the plaintiffs were residents of states other than California, and alleged no connection between their injuries and any conduct taking place in California whatsoever. Because BMS is headquartered in New York (not California), incorporated in Delaware (again, not California), and maintains substantial operations in New York and New Jersey (still not California), the California courts agreed they lacked general jurisdiction over BMS. But the California Supreme Court found that California could consistent with due process exercise specific jurisdiction over BMS using a “sliding scale” under which “the more wide-ranging a defendant’s forum state contacts, the more readily is shown a connection between the forum contacts and the claim.” For those not enthralled by civil procedure, I’ll remind you that general jurisdiction is “all-purpose” jurisdiction for any claim, which a state may exercise over those domiciled within its borders for any purpose. Specific jurisdiction allows a state to exercise jurisdiction over claims relating to a defendant’s specific contacts with the forum state, regardless of whether the defendant is domiciled within its borders.
The United States Supreme Court found the California Supreme Court’s analysis too thin, and explained that the “sliding scale” employed by the California Supreme Courts basically confounds principles of general jurisdiction with specific jurisdiction. Rather than focusing on BMS’s wide-ranging contacts with California in general, the Court looked for some connection between BMS’s conduct that formed the basis of the claims of the nonresidents and the State of California, and found none:
As noted, the nonresidents were not prescribed Plavix in California, did not purchase Plavix in California, did not ingest Plavix in California, and were not injured by Plavix in California. The mere fact that other plaintiffs were prescribed, obtained, and ingested Plavix in California — and allegedly sustained the same injuries as did the non-residents, does not allow the State to assert specific jurisdiction over the non-residents’ claims. . . . 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.
Reversed and remanded.
This analysis coagulates nicely with the recent opinion of the Missouri Supreme Court issued in State ex rel. Norfolk Southern Railway Company v. Dolan. In that case, the Missouri Supreme Court rejected the exercise of general and specific jurisdiction over the defendant railroad for claims asserted by an Indiana resident for injuries arising in Indiana as a result of his work for the railroad in Indiana. Although the railroad, like BMS, did do business in the forum state, the Missouri Supreme Court determined that Missouri lacked general jurisdiction over the railroad under the United States Supreme Court’s analysis in Daimler, 134 S. Ct. 746, 754 (2014) because neither the railroad’s principle place of business nor place of incorporation lay in Missouri, and the railroad’s activities in Missouri were not so substantial so as to render Missouri its de facto home state:
Norfolk owns or operates some 400 miles of track, generates approximately $232 million in revenue, and employees some 590 people in Missouri. It has appointed a registered agent in Missouri. Yet this activity in Missouri represents a tiny portion of Norfolk’s entire business nationwide.
Like the Supreme Court in BMS, the Missouri Supreme Court also rejected the notion that Missouri’s general activities in the state could support the exercise of specific jurisdiction:
Only if the instant suit arises out of Norfolk’s contacts with Missouri does Missouri have specific jurisdiction. Parker pleaded no facts alleging that the injury arose from Norfolk’s Missouri activities.
The Missouri Supreme Court then tied off the argument that the defendant railroad had consented to personal jurisdiction by complying with Missouri’s foreign corporation registration substitute, 506.150(3). The Court noted that nothing in that statute mentions consent to personal jurisdiction (although other courts have held otherwise with respect to other states’ foreign corporation registration statutes, so be careful).