SCOTUS Overturns California's Extreme Expansion of Personal Jurisdiction for National Corporations

SCOTUS Overturns California's Extreme Expansion of Personal Jurisdiction for National Corporations

The United States Supreme Court has issued an important decision rejecting California's effort to assert personal jurisdiction over nonresident corporations and curtailing the plaintiff's bar's efforts at forum shopping.

On June 19, 2017, the Supreme Court in Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco Cty., 582 U.S. ___, 2017 WL 2621322 (2017), held that Bristol-Myers Squibb ("BMS"), a large multinational corporation, may not be subject to personal jurisdiction for claims brought in California by plaintiffs who were allegedly injured by BMS products consumed outside of California even though BMS marketed and sold those products nationally. The plaintiffs in BMS filed their claims that arose out of state along with those of other plaintiffs who allegedly were prescribed and used the same products and sustained the same injuries inside California. The California Supreme Court had found personal jurisdiction existed for both sets of plaintiffs. In evaluating whether the Due Process Clause of the Fourteenth Amendment permitted specific personal jurisdiction to be exercised, the Court stressed the need for a connection between the forum and the specific claims at issue, and criticized the California Supreme Court's "sliding scale approach" of relaxing the requisite connection where the defendant had extensive forum contacts unrelated to those claims.

Especially when coupled with the Supreme Court's recent decisions narrowing the scope of general personal jurisdiction, the BMS decision will have a significant impact upon claimants' ability to use specific personal jurisdiction to bring national manufacturers into whatever court the claimants find more favorable and potentially spells the end of "litigation tourism," a frequently abused method of forum shopping. It will also make it challenging for plaintiffs to bring nationwide mass actions against out of state defendants. Indeed, defendants have already obtained dismissals of claims with suspect personal jurisdiction even in the midst of trial.

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José A. Isasi II

Steven N. Geise
San Diego

Christian G. Vergonis

Brett A. Tarver

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