INTRODUCTION
For the last decade, the Supreme Court of the United States has issued decisions that narrow the circumstances under which courts can exercise personal jurisdiction against large companies.1 In 2017, the Court issued two more decisions that further limit a plaintiff’s ability to sue an out-of-state corporation in state court.2 In Bristol-Myers Squibb Co. v. Superior Court of California (BMS),3 the Court reversed the California Supreme Court and dismissed the claims of 592 non-California residents who sued the pharmaceutical company in the state’s courts over injuries they allegedly sustained from Plavix, a drug manufactured by Bristol-Myers.4 The Court held that, because those plaintiffs did not allege that their injuries occurred in California, or had anything to do with California, the Court could not exercise specific jurisdiction over these plaintiffs’ claims.5
Although the facts of BMS left the Court with no choice but to find that California courts lacked jurisdiction over the non-California resident plaintiffs,6 the opinion’s broad language is problematic for future plaintiffs looking to sue large corporations in states where the plaintiffs may not have suffered an injury, but where the states are linked to the harm in some other way. The BMS opinion’s reasoning will likely be overapplied and used to limit an individual’s ability to sue any corporation that has a large presence in multiple (or even all) states, but lacks the requisite connection to the state that BMS required.7 If overapplied, this decision will serve as an additional bar to plaintiffs seeking to challenge the actions of a large corporation that affect citizens of more than one state. Taken to its logical extreme, the Court’s opinion provides that, for any alleged injury caused by a corporation, the corporation can be sued in a maximum of three states: (1) the state in which the corporation is incorporated; (2) the state in which the corporation is headquartered; and (3) the state where the alleged injury occurred.8
This Note discusses the potential negative effects that BMS can have on future plaintiffs’ ability to sue large corporations in states where the corporations have a major presence but in which they are neither incorporated nor headquartered.9 Part I outlines the history of personal jurisdiction case law. Part II looks to the different approaches that the majority and dissenting opinions in BMS took in examining the question of jurisdiction. It also looks at the sliding scale test that the California Supreme Court used to allow the nonresident plaintiffs to sue within the state’s courts.10 Section II.B then considers the effect that BMS has had on lower courts thus far by looking at how various federal district and state courts have applied the decision, particularly in the context of claims involving false advertising and medical mass torts. It continues by examining cases where judges have distinguished BMS and the potential openings this can leave for future plaintiffs to eventually challenge BMS at the Supreme Court. Part III proposes an expansion of personal jurisdiction principles to allow courts to hear cases in which plaintiffs sue corporations in a state that has a proximate connection to the harm alleged and an analysis for when and how to analyze the proximate connection. This Part also discusses the complexities of third-party connections to a state and concerns about forum shopping, arguing that the former can be enough of a connection despite Walden v. Fiore,11 and that the latter is a persistent problem that no amount of limiting access to courts can seriously prevent.
I. BACKGROUND
Establishing that a court has jurisdiction over a defendant is an important step for litigants seeking review of their claims on the merits.12 Lack of personal jurisdiction is both a defense and ground for a court to dismiss an action in all jurisdictions in the United States, both state and federal.13 Because of its ability to end a proceeding before it even starts, it is an important threshold question in any litigation.14 Although statutes and local courts dictate rules for jurisdiction, the issue is often unclear and leaves more questions than answers.15 As a result, courts have grappled with identifying and articulating a workable and appropriate standard for personal jurisdiction.
A. Early Personal Jurisdiction Jurisprudence
Although the doctrine has been revised and rewritten since the Supreme Court’s earliest opinions, modern personal jurisdiction cases still look to early personal jurisdiction cases as the backbone of their analyses on the issue.16 For example, concern about limiting the coercive power of the state has remained a consistent theme throughout history.17
1. Actual Presence
Any discussion of personal jurisdiction necessarily begins with the infamous case of Pennoyer v. Neff.18 In Pennoyer, the Court held that, in order for a court to exercise in personam jurisdiction19 over a defendant, the defendant must be served in the state in which the court is located.20 The Pennoyer Court established the principle that, in order for a court to be able to exercise its jurisdiction over a defendant, there must be due process.21 To the Pennoyer Court, this required a defendant’s appearance or personal service on the defendant before they could be bound by any judgment.22 Pennoyer further stands for the proposition that a state’s sovereignty grants it exclusive jurisdiction over the inhabitants and property within its borders.23
2. Minimum Contacts
Nearly seventy years after Pennoyer, the Court again looked at due process in a personal jurisdiction analysis in International Shoe Co. v. Washington.24 In International Shoe, the Court found that Washington state could exercise jurisdiction over an out-of-state corporation because of the activities that the corporation conducted within the state’s borders.25 International Shoe held that a defendant must have certain “minimum contacts” with a state, such that maintaining a lawsuit against it does not offend “traditional notions of fair play and substantial justice.”26 The Court measured International Shoe’s presence by the activities of agents acting on the corporation’s behalf.27 It found that the company’s activities in the state were “neither irregular nor casual,” but rather “systematic and continuous.”28
The “minimum contacts” requirement is rooted in the Due Process Clause of the U.S. Constitution.29 When a corporation conducts activities within a state, it enjoys certain benefits and protections of that state’s laws, such as the ability to use its roads and make sales within the state.30 In exchange for the privileges and protections the state provides, the corporation takes on certain obligations, including being subject to suit in the state for activities conducted within its borders.31 International Shoe held that the inquiry into whether due process allows a state to exercise personal jurisdiction over a defendant requires analyzing the “quality and nature” of the defendant’s activities within the state in relation to the purpose of the Due Process Clause.32 The Court further clarified that a single, isolated, or casual connection to a state is not sufficient for its courts to have jurisdiction over a party for activities not arising out of those isolated actions.33
3. Purposeful Availment
After International Shoe, courts grappled with what exactly constituted a “minimum contact” sufficient to allow a court to exercise personal jurisdiction over a party. In McGee v. International Life Insurance,34 the Supreme Court found that an out-of-state defendant’s single contract with a state’s resident was enough to establish personal jurisdiction because the contract deeply related to the underlying cause of action.35 Due process supported exercising jurisdiction36 even though the defendant may experience some inconvenience in defending the lawsuit.37 The Court noted that (at the time) modern transportation and communication systems made it much less burdensome for a party to defend against lawsuits in a state where it conducts economic activity even if the party does not reside in that state.38 It also identified the state’s undeniable interest in providing similarly situated residents a means of redress for their harm.39
One year later, the Court added “purposeful availment” to the personal jurisdiction analysis.40 In Hanson v. Denckla,41 the Court rejected a forum’s exercise of personal jurisdiction over a defendant who did not benefit from its laws and protections and therefore was not subject to jurisdiction in the state.42 Although also involving a nonresident defendant’s single contract with a state resident, the Court distinguished Hanson from McGee because the defendant did not unilaterally solicit an agreement with a resident of the state where jurisdiction was sought.43
4. Stream of Commerce and Foreseeability
The “stream of commerce” theory applies when a corporation manufactures, sells, or markets a product in one state, the product ends up in another state, and the product injures someone in that other state.44 The question the courts must ask is whether the corporation has purposefully availed itself of jurisdiction within the state where one suffers an injury.45
In World-Wide Volkswagen Corp. v. Woodson,46 the Court again analyzed whether a business’s connections to a state subjected it to jurisdiction within the forum.47 It viewed the due process question in terms of foreseeability by asking whether defendants’ connection to a state could lead them to reasonably anticipate being haled before a court in that state.48 Because the defendants (a New York dealership and distributor) did not avail themselves of the privileges of conducting business in Oklahoma, they could not be subject to jurisdiction in Oklahoma’s courts.49 Although the product purchased—an automobile—is mobile by its very nature, this was not enough to lead the dealership to “foresee” that the car could end up in another forum.50 The car ended up in Oklahoma due to the unilateral activity of the party claiming the connection to the state (plaintiffs), which is not a sufficient connection to subject a defendant to jurisdiction after Hanson v. Denckla.51
B. Distinguishing Between General and Specific Jurisdiction
The Court clarified the distinction between specific and general jurisdiction in Helicopteros Nacionales de Colombia, S.A. v. Hall.52 A court has specific jurisdiction when a controversy “arises out of” a defendant’s contacts with the forum, creating a relationship between the defendant, the forum, and the litigation.53 In contrast, a state asserts general jurisdiction when a lawsuit’s controversy does not arise out of or relate to the defendant’s contacts or activities in the forum,54 but rather out of the defendant’s domicile, incorporation, or principal place of business in the forum.55
In Helicopteros, survivors and representatives of victims of a helicopter crash in Peru sued the Colombian company that owned the helicopter in Texas court.56 The Supreme Court held that the company’s connections to the state were not sufficient enough for the state to exercise personal jurisdiction over the foreign defendant,57 pointing to the connections that the corporation did not have with Texas.58 Furthermore, neither the representatives who brought the lawsuit nor their decedents were domiciled in Texas.59 As a result, Texas courts could not exercise “general jurisdiction” over the corporation.60
C. Fairness Factors in Personal Jurisdiction Analysis
In Burger King v. Rudzewicz,61 the Court found that Florida could assert its long-arm jurisdiction over a defendant on the basis of a single contract within the state, notwithstanding the fact that the defendant had never been to Florida.62 Justice Brennan’s majority opinion identified the following factors to look to when examining the fairness of a state’s assertion of jurisdiction over a party: (1) “the burden on the defendant”; (2) “the forum State’s interest in adjudicating the dispute”; (3) “the plaintiff’s interest in obtaining convenient and effective relief”; (4) “the interstate judicial system’s interest in obtaining the most efficient resolution of controversies”; and (5) “the ‘shared interest of the several States in furthering fundamental substantive social policies.’”63
The Supreme Court found that the Florida court’s assertion of personal jurisdiction over the nonresident defendant did not offend due process.64 When the defendant, a Michigan resident, entered into a franchise agreement with a Florida corporation, he began a voluntary relationship that envisioned “continuing and wide-reaching contacts” with Florida and was being haled into the state’s court on the basis of a dispute arising from that contract.65 Justice Brennan’s “fairness factors”66 provided a complicated yet comprehensive analysis that balanced the dual interests of territorial federalism and defendant-oriented liberty protections.67
D. Moving Toward Well-Defined Rules
Nearly 150 years after Pennoyer, the Supreme Court had a long list of personal jurisdiction cases, but few clear rules.68 Beginning in 2011, the Court began further narrowing the scope of personal jurisdiction with opinions that reshaped its jurisprudence in this area.69
1. McIntyre: More Than a Single Sale
In J. McIntyre Machinery, Ltd. v. Nicastro,70 a worker was seriously injured while using a machine manufactured by a British company, McIntyre.71 Justice Kennedy’s opinion held that, although McIntyre’s machine ended up in New Jersey’s stream of commerce, the Court lacked jurisdiction over the company because it did not intentionally target that particular state.72 Justice Kennedy reasoned that the legislature, as opposed to the Court, had greater power to establish jurisdiction over McIntyre.73 Justice Breyer’s more narrow opinion74 found that a single, isolated sale, without more, was insufficient to establish the minimum contacts with a forum state.75
Justice Ginsburg’s dissent argued that McIntyre purposefully availed itself of the jurisdiction by taking steps to deliberately target the United States as a single market.76 Therefore, it availed itself of the privilege of conducting business in all states where its products were sold by an exclusive distributor.77 Although arguably an extension of the Court’s earlier personal jurisdiction rulings, this opinion aptly identified issues the Court continues to face in the increasingly interconnected world.78
2. Goodyear: General Jurisdiction Where Corporations are “At Home”
In a lawsuit involving foreign entities and a bus accident in Europe, Justice Ginsburg reversed course from her McIntyre dissent and found a lack of personal jurisdiction against a foreign corporation in the United States in Goodyear Dunlop Tires Operations, S.A. v. Brown.79 Although the defendants’ subsidiaries had some minor connections to North Carolina,80 Justice Ginsburg found them limited and not an adequate basis to subject the companies to suit there.81 Citing Helicopteros, the Court ruled that the foreign subsidiaries are not “at home” in the state and, thus, are not subject to general jurisdiction before its courts.82 Although unanimous on these facts, the Court’s opinion did not identify contacts relevant to the personal jurisdiction analysis, leaving questions open for future consideration.83
3. Walden v. Fiore: Connection by More than the Plaintiff
A defendant’s connection to a forum must come from more than the mere fact that a plaintiff is located there.84 If a defendant has no connection to the state and the harm allegedly suffered occurred outside of the state’s boundaries, the state does not have jurisdiction to hear the lawsuit.85 The defendant’s connection to the forum “must arise out of contacts that the ‘defendant himself’ creates” with it, beyond the defendant’s connections to the plaintiff.86
4. Daimler: Limiting General Jurisdiction
In the last major personal jurisdiction case before the 2017 term, the Court issued what was viewed as the most restrictive general jurisdiction definition to date in Daimler AG v. Bauman.87 The Court rejected the plaintiff’s assertion that Daimler should be subject to jurisdiction in California because of its connection to a United States distributor, MBUSA.88 Even assuming that MBUSA was “at home” in California, this relationship is still not enough to subject Daimler to general jurisdiction in the state.89 The companies’ contacts in the state were not “continuous and systematic” enough to make them “essentially at home” there.90 The foreign corporation could not be sued in California for activities that occurred outside the state’s borders.91 Allowing California to render judgment over such a corporation would not comply with the “fair play and substantial justice” that due process demands.92
Daimler strengthened the notion that only a “limited set of affiliations” with a forum render a defendant amenable to “all-purpose jurisdiction” there.93 For example, a corporation may be sued on “any and all claims” in the state where it is incorporated and where it has its principal place of business.94
Justice Sotomayor, the only Justice who did not join the majority opinion, concurred in the judgment, but expressed concern that the holding should only apply to Daimler’s “unique circumstances.”95 Justice Sotomayor argued that the general jurisdiction inquiry involved two questions: (1) whether a defendant has sufficient contacts to a forum to support personal jurisdiction; and (2) whether the forum’s exercise of jurisdiction would be reasonable under the circumstances.96 Her analysis found that MBUSA’s considerable contacts with California97 demonstrate that it had taken advantage of the state’s laws and protections, thereby meeting the first prong.98 However, the plaintiffs failed to show that it would be more convenient to litigate the case in California rather than in Germany, so the plaintiffs failed on the reasonableness prong.99
Justice Sotomayor disagreed with the majority’s analysis and argued that it improperly looked at the corporation’s connections to the state in comparison to its connection to other states.100 Citing an article on which the Goodyear and Daimler majority opinions both relied, she reasoned that the defendants should not be considered less amenable to suit in one state merely because they have stronger business contacts to other states, as this other activity is “virtually irrelevant” to the general jurisdiction question.101
While the majority maintained that predictability concerns supported its holding and prevented companies from being subject to lawsuits in too many fora,102 Justice Sotomayor countered that a company’s substantial contacts with a state should allow it to predict that it could be subject to jurisdiction there.103 Sotomayor further asserted that allowing Daimler to be subject to general jurisdiction in every state in which MBUSA has sizeable sales is an “inevitable consequence” of seventy years of due process case law on the issue.104
Justice Sotomayor expressed concern that the majority’s rule will lead to “deep injustice” in four ways: (1) curtail a state’s sovereign authority to adjudicate disputes against corporate defendants with continuous and substantial business ties within its borders; (2) unfairly create greater immunity for large corporations with more extensive ties to a state than a small business running a much smaller operation; (3) expose a state’s one-time visitors to jurisdiction105 while freeing a large corporation from exposure to suit if it is not “at home” in the state per the majority’s definition; and (4) shift the risk of loss from multinational corporations to individuals harmed by their actions.106 Such unfair results, Sotomayor opined, deemed Daimler “too big for general jurisdiction.”107
II. ANALYSIS
A. Specific Jurisdiction in the 2017 Term
The 2017 Supreme Court term saw the Court issue two decisions that can have major implications for plaintiffs suing large corporations.108 Both BMS and BNSF Railway limit when courts can exercise specific jurisdiction over out-of-state defendants.109
1. Bristol-Myers Squibb Co. v. Superior Court of California
In BMS, over 600 plaintiffs110 filed a civil action in California state court, asserting state law claims against drug manufacturer Bristol-Myers Squibb for alleged injuries they suffered while taking the drug Plavix.111 Bristol-Myers is incorporated in Delaware and headquartered in New York; therefore, Daimler precluded California courts from exercising general jurisdiction over the company for actions not connected to the state.112
a. The California Supreme Court’s Sliding Scale Approach
A majority of the California Supreme Court adopted a sliding scale approach to specific jurisdiction, recognizing that the more wide-ranging a defendant’s contacts with a forum are, the greater the connection between the forum contacts and the claim alleged.113 The court ruled that, where minimum contacts with the forum are established, it could exercise jurisdiction over claims involving less direct connections between the defendant’s forum activities and claims alleged than might otherwise be required.114 The court cited Bristol-Myers’ sizeable revenues from the sale of Plavix and other products in California to support its finding that all of the plaintiffs’ claims arose from or were related to the company’s connections with the state.115 It found that there was “no question” that Bristol-Myers purposely availed itself of the privilege of conducting activities in California by marketing and advertising Plavix in the state, employing sales representatives in the state, contracting with a California-based distributor, operating research and laboratory facilities in the state, and having an office in the state capital for the purpose of lobbying politicians on the company’s behalf.116
The court concluded that it could exercise jurisdiction over the resident and nonresident plaintiffs’ claims.117 The majority reasoned that Bristol-Myers’ marketing, promotion, and distribution of Plavix created a “substantial nexus” between the non-California resident plaintiffs’ claims and Bristol-Myers’ activities in California related to Plavix.118 Three justices dissented, finding that the nonresident plaintiffs’ claims did not substantially relate to Bristol-Myers’ contacts with California.119 They reasoned that mere similarity of claims alleged by the nonresident plaintiffs to the resident plaintiffs’ claims was not a substantial enough nexus between the nonresidents’ claims and Bristol-Myers’ activities in the state.120
b. The Supreme Court Rejects the Sliding Scale Test
Six months after granting certiorari,121 the U.S. Supreme Court issued a decisive 8-1 opinion expressly rejecting the California Supreme Court’s sliding scale test for specific jurisdiction and likening it to a “loose and spurious form of general jurisdiction” not supported by the Court’s precedent.122 The Court reiterated that a corporation’s continuous activity in a state is not enough to make it amenable to lawsuits not arising from that state-connected activity.123 The Court held that California could not exercise specific jurisdiction against the company over the nonresidents’ claims because these plaintiffs were not prescribed Plavix in California, did not purchase it in California, did not ingest it in California, and did not suffer their alleged injuries from the drug in California.124
The majority incorrectly rejected both the California Supreme Court and plaintiffs’ argument that the fact that other plaintiffs were prescribed, purchased, or ingested the same drug and allegedly suffered the same injuries as the nonresident plaintiffs allowed the state to exercise jurisdiction over all of the claims.125 Citing Walden v. Fiore, the Court held that, standing alone, a defendant’s connection to a third party is not a sufficient basis for a state to exercise jurisdiction over a defendant.126 While the California Supreme Court held that the similarity of the claims supported the state’s exercise of jurisdiction over all of the plaintiffs’ claims in light of judicial economy principles,127 eight justices of the U.S. Supreme Court suggested that the nonresident plaintiffs could instead sue in their thirty-three separate home states or where the company is subject to general jurisdiction (New York or Delaware).128 Such a “solution” is far from the most efficient course of conduct in terms of time and risks courts finding thirty-three different assessments of the company’s liability for the same conduct and activity: producing, marketing, and selling a drug that caused the plaintiffs’ injuries.129
The majority also rejected Bristol-Myers’ third-party connection to McKesson, a California company it contracted with to distribute Plavix nationally, as being an insufficient basis for California courts to exercise jurisdiction over the claims against Bristol-Myers.130 The majority found no allegations that McKesson and Bristol-Myers together engaged in acts that lead to the nonresident plaintiffs’ injuries or that Bristol-Myers was subject to derivative liability for McKesson’s actions.131 Yet, contracting with a California corporation was another example of Bristol-Myers’ ties to the state.132
c. Justice Sotomayor’s Dissent
Echoing her Daimler concurrence,133 Justice Sotomayor’s BMS dissent maintained that the majority’s decision improperly reduced the availability of specific jurisdiction without considering fairness to the parties.134 Justice Sotomayor argued that in order for a court to validly exercise specific jurisdiction, (1) the defendant must purposefully avail itself of the privilege of conducting activities within the state, or purposefully direct its conduct at the forum state; (2) the plaintiff’s claim must arise out of or relate to the defendant’s forum conduct; and (3) exercising jurisdiction must be reasonable under the circumstances.135 Sotomayor found “no dispute” that Bristol-Myers purposefully availed itself of the privilege of conducting business in California.136 The second prong was satisfied because the nonresidents’ claims involved “materially identical” conduct to actions the company took in California.137 The alleged injuries arose from a nationwide course of conduct involving the same essential acts and affecting residents in multiple states.138 Lastly, the third prong was satisfied because litigating identical claims in a single forum is reasonable for both the state and defendant.139
Justice Sotomayor correctly disagreed with the majority’s contention that it followed precedent in coming to its decision, arguing that both precedent and common sense required a different result.140 The majority’s reliance on Walden was irrelevant because the nearly $1 billion that Bristol-Myers earned from selling Plavix in California during the relevant time period demonstrated that the company purposefully availed itself of the privilege of conducting business there.141
The dissent focused on the consequences of the majority’s decision, fearing that the majority’s holding would effectively eliminate mass actions in states other than where a corporation is subject to general jurisdiction, which might not be a convenient or easily accessible forum for plaintiffs with relatively few means and small claims.142 The majority’s decision could also make it impossible for plaintiffs to sue defendants headquartered or incorporated in different states or not “at home” in any state.143
The strong disagreement between the majority and dissent’s reasoning illustrates the difficulty in defining whether conduct “relates to” a forum and what conduct is being discussed.144 The majority defined the conduct alleged as Bristol-Myers’ marketing the drug in the state in which the nonresident plaintiffs obtained Plavix or suffered their injuries.145 In contrast, the dissent defined the conduct as a nationwide advertising campaign that targeted multiple states and injured parties there.146 One cannot deny that a corporation’s conduct in a state and substantial financial benefit obtained from access to its markets creates a connection to the state. If a corporation has the means to offer its products to a state in such large quantities, it has certainly purposefully availed itself of being subject to personal jurisdiction within the state’s borders.147
2. BNSF Railway Co. v. Tyrrell
In BNSF Railway Co. v. Tyrrell, the Supreme Court issued another almost unanimous opinion on personal jurisdiction, where two railroad employees brought actions against their employer, BNSF Railway, in Montana state court for injuries sustained while working for the company.148 Because BNSF Railway is incorporated in Delaware and has its principle place of business in Texas, the company was not subject to general jurisdiction in Montana.149 Finding that neither plaintiff was injured in or alleged harm in Montana, the majority ruled that the business BNSF Railway conducted in Montana did not subject it to specific jurisdiction for activities unrelated to its Montana activities.150 The Court relied mainly on Daimler and International Shoe.151
Justice Sotomayor dissented in part, calling the majority’s view of International Shoe “overly restrictive” and previewing her opinion in BMS.152 Her dissent criticized the Daimler majority’s comparative contacts analysis, where the Court compared a company’s connections to a state in relation to its connections to other states, as inappropriate under International Shoe.153 Justice Sotomayor argued that the relative percentage of a defendant’s contacts to a forum state is irrelevant, and that the personal jurisdiction inquiry under International Shoe should focus on the “quality and quantity” of the defendant’s contacts with the forum state.154 As with her BMS dissent, Justice Sotomayor criticized the majority for the “jurisdictional windfall” it granted to large or multinational corporations operating in many jurisdictions and for the difficulty the opinion created in subjecting them to personal jurisdiction.155
B. Bristol-Myers Squibb’s Effect on the Courts
Although seemingly logical on the facts of the case, BMS provides a blueprint for courts to exercise their jurisdiction in illogical ways.156 This Section analyzes some early case law following BMS and the harmful effects the case can have on access to courts. Consider the following hypothetical: A and B are next door neighbors in a suburb of Minnesota. Both A and B buy a car from a national dealership incorporated in and with its principal place of business in Michigan and with a substantial presence in Wisconsin and Minnesota.157 Assume that the car was manufactured in Canada.
While A is driving to visit a friend in Chicago, A gets into an accident on a highway in Wisconsin and suffers injuries and damage to the car. The cause of the accident is a structural defect in the car. B, owning a car of the same make and model, gets into the same type of accident a few blocks from where A and B live in Minnesota, and suffers the same injuries. According to BMS, only B can sue the dealership in Minnesota, because B’s injuries “arise” out of events that took place within the state’s borders.158 A would only be able to sue the dealership in Wisconsin (where the accident occurred) and Michigan (where the dealership is subject to general jurisdiction). Under BMS, A could not sue in Minnesota despite the fact that the dealership has a substantial presence in the state, sells the exact make and model car that caused A’s injuries to other Minnesota residents, and has been responsible for at least one accident and injuries in the state (B’s accident).159 In order to bring its action, A must travel across state lines to bring an action, at great time and expense to A, who is an individual plaintiff with fewer resources than a multi-state corporation. In contrast, it is not nearly as inconvenient, unfair, or unreasonable to subject the national dealership, which purposefully availed itself of the privilege of doing business in Minnesota, to a lawsuit in the state for injuries related to actions that took place in the state. And yet, BMS forbids such a result.160
Justice Sotomayor’s dissent in BMS cautioned that the majority’s decision would curtail, and potentially eliminate, plaintiffs’ ability to hold corporations accountable for their nationwide conduct.161 This Section examines the effect of the majority’s decision on lower courts analyzing the propriety of exercising personal jurisdiction over defendants.
1. Specific Jurisdiction After Bristol-Myers Squibb
In a decision issued less than two weeks after BMS, a district court in Missouri dismissed a case involving very similar facts, where eight Missouri residents and eighty-six non-Missouri residents sued for injuries allegedly caused by the anti-clotting drug Praxada.162 The court found that BMS clarified the specific jurisdiction inquiry, allowing it to decisively dismiss the nonresident plaintiffs’ claims.163 It analyzed the company’s connections to the state (as the BMS Court did) and found that because the non-Missouri resident plaintiffs were not prescribed Praxada in the state, did not purchase the drug in the state, and did not suffer any injury or receive any treatment in Missouri, their claims were not connected to and did not arise out of the defendants’ activities in Missouri.164
Echoing BMS, the Missouri court ruled this way despite the fact that the defendant drug company widely marketed and sold Praxada in Missouri.165 The court held that, under BMS, due process forbids the state from exercising personal jurisdiction over the nonresidents’ claims.166 However, Boehringer itself advertised its connection to Missouri on its corporate website.167 The presence of one of the company’s subsidiaries and operations within the state undermines its claim that it did not have a substantial connection to Missouri, and that litigating in the state would be inconvenient and unfair to the company.168
The same court held that BMS altered the state of affairs for out-of-state plaintiffs suing in mass tort169 and products liability actions.170 In Jordan v. Bayer Corp., the Missouri federal court found it could not exercise specific jurisdiction over nonresident plaintiffs’ claims against a nonresident corporation because the corporation did not develop, manufacture, package, or create the marketing strategy for the product complained of within the state.171 The court described Bayer’s general business activities as insufficient to subject it to personal jurisdiction in the state and cited Siegfried as a case that made the personal jurisdiction inquiry much more straightforward.172 Bayer’s corporate website lists only a New Jersey address as its U.S. location;173 however, the company advertised jobs located in Missouri.174 Even if its operations in the state are minor, Bayer has substantially benefitted from its presence in the United States with billions of dollars’ worth of sales.175 The plaintiffs suing Bayer do not have access to such resources and wealth, yet the courts appear to ignore this imbalance when analyzing the “burden” on a defendant in litigation.176
In a case where the defendant’s connections to the forum state were arguably weaker than Bristol-Myers’s connections to California,177 a New York state trial court cited BMS to support the proposition that a corporate defendant’s contacts with a state need to be connected to the claim before the court.178 The court found that defendant’s only connection to New York was the plaintiff’s residence, which is insufficient to support it exercising specific jurisdiction under BMS and Walden.179 The New York court described BMS’s central holding as having “universal application” that would allow a court to deny exercising jurisdiction even when a defendant has connections to a state.180 This strong language demonstrates the reality and risk of BMS being overapplied to cases where, for example, corporations are sued in states where they have a substantial presence but are not headquartered.181
In a puzzling opinion, the Ninth Circuit found that a corporation’s purposeful actions in a state, over which the plaintiff sued, did not give the forum state specific jurisdiction over the case.182 In Morrill v. Scott Financial Corp.,183 where defendants initiated an action to enforce a subpoena against plaintiffs in Arizona, the plaintiffs countersued and alleged abuse of process and wrongful institution of civil proceedings.184 Despite the defendants specifically targeting plaintiffs in the state and knowing the plaintiffs would feel harm there, the court held that the defendants’ alleged tortious acts had very little to do with Arizona and only took place in the state because it was where the plaintiffs resided.185
This analysis is odd when considering the conduct the plaintiffs alleged of the defendants, including commencing civil actions, filing an opposition to the plaintiffs’ motion to quash subpoenas, appearing pro hac vice in the Arizona proceedings, and opposing the plaintiffs’ appeals.186 Seemingly ignoring the defendants’ intentional acts, the court reasoned that the case was more similar to Walden v. Fiore than Calder v. Jones.187 However, the Supreme Court’s holding in Calder perfectly fits the facts of Morrill. Calder presents a test for whether a court can exercise jurisdiction over alleged intentional torts.188 The Calder “effects” test requires that a defendant: (1) committed an intentional act; (2) expressly aimed at the forum state; and (3) caused harm that the defendant knew would likely be suffered in the forum state.189 Under Calder, the Morill court should have exercised jurisdiction based on the defendants’ actions intentionally targeting Arizona.
While the Morill defendants’ connection to Arizona began with the plaintiffs, its purposeful and intentional actions targeting the state’s residents, and utilization of the state’s courts, gave rise to the lawsuit. Therefore, it does not violate due process to forbid these plaintiffs from pursuing a lawsuit over these actions that took place in Arizona in the state’s courts.190 The court’s reasoning followed the general trend of courts exercising personal jurisdiction in fewer cases, echoing the reasoning in BMS.191
A federal court in New York cited BMS to support dismissing a class action complaint against a defendant, Burkhart, even though BMS did not address whether its holding applied to class actions.192 The court described the company—a defendant in a lawsuit alleging price fixing and unfair competition—as a small, regional distributor that only holds about three percent of the national market.193 The court reasoned that Burkhart never registered to do business in New York, had any offices or employees in the state, owned or maintained assets there, or conducted direct advertising or marketing activities in New York; therefore, the company could not foresee that its products would end up in the state.194 Echoing BMS, the judge found that although Burkhart sold products in New York, those sales were not connected to the antitrust claim at issue.195
Although BMS did not involve a class action, this court extended its holding to prevent more litigants from finding remedies for their harms in a nearby court. It described BMS as “tightening the reins on this analysis” for specific jurisdiction, and itself shrunk the possible claims that could be brought in the forum.196 This court improperly considered the company’s ties to New York comparatively, as opposed to its ties to New York in general.197 An Illinois district court that dismissed claims of false advertising brought on behalf of non-Illinois residents took the same view, finding BMS instructive on the matter.198
As one of the only federal appeals courts to consider this issue,199 the Ninth Circuit ruled that California could not exercise specific jurisdiction over a foreign corporation for alleged copyright infringement stemming from an email received by residents of the state.200 The email was received by 343 people, fewer than ten of whom resided in California.201 The court held that the primary concern in the specific jurisdiction inquiry is the burden on the defendant, and cited BMS to support this proposition.202 The defendant’s single contact with California (one email received by a few of its residents) was too attenuated to permit the state to exercise specific jurisdiction.203 While the number and ratio of California residents who received the email were small, the court’s inquiry should not stop there; it should look to the quality and consistency of the defendant’s relationship to the state and not solely the numbers. Furthermore, the Supreme Court’s jurisprudence provides several factors to consider in the personal jurisdiction inquiry in addition to the burden on the defendant.204
2. Courts Distinguishing Bristol-Myers Squibb
On the same day that a Missouri court declined to exercise personal jurisdiction over non-Missouri residents in its courts,205 the Northern District of California distinguished BMS and exercised personal jurisdiction against Bristol-Myers and AstraZeneca Pharmaceuticals in actions for alleged injuries from Type-2 diabetes drug Saxagliptin.206 The court applied essentially the same three-part test Justice Sotomayor used when considering that the defendants conducted clinical trials, testing and studying, and inadequate reporting of the drug in California.207 Although the companies conducted clinical trials in other jurisdictions, the court identified the conduct that took place in California as a “but for” cause of the plaintiffs’ injuries.208 Assuming the plaintiffs’ allegations were true, if the drug had never been developed, tested, or approved, the plaintiffs would never have been injured.209 The defendants’ actions in California were part of the “unbroken chain of events” that led to the plaintiffs’ alleged injuries.210 In allowing the lawsuit to continue, the court maintained the plaintiffs’ access to justice without increasing the defendants’ burden of litigating in the state. Unlike the BMS court, it correctly found that the defendants’ extensive connections to California did not make it inconvenient for them to litigate in the state, and the actions that took place there were tied to the causes of action.211 Since the Astrazeneca Pharmaceuticals already has a big operation in California, they are well-equipped to defend the lawsuit in the forum.
A California federal court disagreed with the Dental Supplies Antitrust Litigation and McDonnell courts when it found that the BMS Court left open the question of whether its holding applied in a class action context.212 A few weeks later, the same court ruled that BMS applied only to mass actions and not class action cases alleging tortious causes of action.213
The court allowed the plaintiffs’ lawsuit, which alleged false and misleading advertising that Canada Dry Ginger Ale contained actual ginger in it, to continue against the non-California corporation.214 It held that BMS did not apply to non-California residents’ claims because all named plaintiffs in the class action were California residents.215 The court distinguished mass tort actions (where every plaintiff must be named) from class actions (where the citizenship of unnamed plaintiffs is not considered in the diversity of citizenship analysis).216 This court, too, did not look merely at numbers when considering the fairness of jurisdiction, as the defendant’s sales and presence in California belies any claim that it is inconvenient for it to defend a lawsuit in the state.217 If the company arranged to sell and profit from its products being sold in California, it can defend a lawsuit there.
A Wisconsin federal court took the most drastic departure from the BMS holding in an action involving a Pennsylvania car accident that left one plaintiff a quadriplegic.218 The court found that Ford Motor’s extensive connections to Wisconsin related to the plaintiffs’ claims even though the car involved was not purchased or manufactured in Wisconsin.219 The company’s link to Wisconsin was not based on any “random, fortuitous, or attenuated” contacts and did not arise solely from its connection to the plaintiffs.220 The court focused on Ford’s willingness to serve and sell its products to Wisconsin customers, its “pervasive” marketing in the state, and the actual benefit it derived from selling its vehicles to Wisconsin customers to support its conclusion that Ford could reasonably anticipate being haled before a Wisconsin court.221 Ford also had 122 dealerships in Wisconsin.222 The court’s foreseeability analysis properly focused on the defendant’s connection to the state, not a comparison of the strength of its connections to other states.223 This foreseeability meant that subjecting Ford to lawsuits in Wisconsin from a car that it sold in the Wisconsin market did not violate the Due Process Clause.224
III. PROPOSAL
As the decisions discussed in Part II of this Note demonstrate, trial and appellate courts now cite BMS to deny exercising personal jurisdiction over non-citizen defendants with a potentially large presence in the forum.225 The decision’s strong language about its clear and obvious result gives lower courts confidence and credibility to apply the holding in a wide range of situations, including those that warrant ruling the other way and exercising jurisdiction over a foreign or out-of-state defendant.226 After reviewing the effects of BMS on lower courts throughout the country, this Note proposes a solution that espouses familiar principles of personal jurisdiction case law and takes into account the modern, interconnected nature of business activities in multiple states.227
If a nonresident company takes a substantial step to target a forum, such as manufacturing, advertising, or selling its products within a state’s borders,228 and a plaintiff sues for injuries resulting from the product, courts should hold that exercising specific jurisdiction over the company does not violate due process, even when considering the claims of nonresident plaintiffs who do not allege injuries in the state. In such a situation, although the injury itself may not have occurred within the borders of the forum state, the company’s in-state actions should be analyzed as part of the but-for chain of events that lead to the injuries in several fora.229 Accordingly, the forum in which the company took a significant step that led to a plaintiff’s injury elsewhere is an adequate forum for the plaintiff’s claims to be heard. Such a result does not violate the Due Process Clause because it looks to the defendant’s own conduct to evaluate the adequacy of exercising personal jurisdiction over them.230
Similarly, the California Supreme Court suggested a plausible outline for when to exercise specific jurisdiction in mass tort cases involving pharmaceuticals: a state where drugs are manufactured, from which drugs are distributed both within and outside of the state’s borders, could exercise specific jurisdiction over all claims related to that drug because such claims “arise from” the defective manufacturing that occurred in the state.231 In the products liability and false advertising context, a company should be subject to suit in the states where it developed and approved a product or advertising campaign that went to market and caused harm, regardless of where the harm occurred. If the product was never developed, approved, or marketed (or a certain advertising decision was never made), the alleged harms would never have occurred. If a company chooses to take a major action in a particular state, it should be subject to suit for harms arising directly from that action. Such a proposal is not inconsistent with the Court’s personal jurisdiction case law,232 but may appear to clash with its recent preference for bright-line rules.233
The traditional personal jurisdiction inquiry and the Calder effects test are consistent with this Note’s proposal. In order to exercise specific jurisdiction, a court must find that (1) the defendant purposefully availed itself of the privilege of conducting activities in the forum state or purposefully directed its conduct at the state; (2) the plaintiff’s claim arises out of or relates to the defendant’s conduct in the forum; and (3) exercising jurisdiction is reasonable under the circumstances.234 The Calder effects test requires that the defendant (1) committed an intentional act; (2) expressly aimed at the forum state; and (3) caused harm that the defendant knew would likely be suffered in the forum state.235 A company’s choice to advertise and sell its products in a state is an intentional act aimed at the forum, from which the company hopes to derive some sort of advantage or profit.236 Just as a company expects to receive benefits from doing business in a state, it should anticipate that if something goes wrong with its product, the effects will be felt wherever that product is sold. Put differently, the potential harms will be felt wherever the company acted to have its product placed. Thus, the third Calder prong is met because the company knowingly took steps to put its product on the market in various jurisdictions.237 Accordingly, under this Note’s proposal, a corporation can reasonably anticipate being haled before courts in the states where jurisdiction is proper.238
Corporate defendants may strongly disavow and exaggerate the potential breadth of this proposal as subjecting them to jurisdiction everywhere they conduct business or make even an isolated sale. However, this Note does not look to upend well-settled principles of personal jurisdiction,239 including the longstanding notion that a single, isolated sale is insufficient to subject a company to suit before a state’s courts unless the lawsuit arises from that specific sale.240 Injecting a product into the stream of commerce is a willful act,241 although companies would argue that they do not always have control over where their products end up. The fairness factors identified in Justice Brennan’s Burger King opinion ensure that personal jurisdiction is not exercised too broadly in circumstances where defendants do not avail themselves of lawsuits in distant courts.242
While the BMS decision and courts that agree with its holding would disagree with this proposal because the harm that a particular plaintiff suffered may not have happened in or relate to the lawsuit’s forum, they fail to take into account several of the fairness factors identified in Burger King, specifically: (1) the forum state’s interest in adjudicating the dispute; (2) the interstate judicial system’s interest in obtaining the most efficient resolution of disputes; and (3) the shared interest of the states in furthering substantive social policies.243
In the context of mass torts, state courts see a large number of plaintiffs complaining of similar harms allegedly committed by a single or small group of defendants. If a number of the state’s residents complain of that harm, the state has an interest in preventing the harm from spreading to more residents.244 The court must already hear its residents’ claims and, since the company purposefully availed itself of the privilege of doing business in the forum by intentionally targeting it, allowing the forum’s court to hear the nonresidents’ claims related to conduct that the company also committed in the state (e.g., false advertising, manufacturing a harmful drug, or some other alleged intentional misconduct) does not violate due process principles.245 It is much more efficient for a single state to hear a group of nearly identical cases than to risk inconsistent outcomes from litigation in all fifty states, with potentially different interpretations of a company’s liability in each.246 This consolidation of the claims is also much more efficient for a defendant, who would not have to defend against lawsuits in multiple jurisdictions.247
A. Third-Party Connections to a Forum State
BMS upholds Walden v. Fiore’s principle that a defendant’s connection to a forum state must arise from the defendant’s own activities, not the activities of the plaintiff or a third party.248 However, this Note acknowledges the reality of modern commerce, where a product can potentially go through dozens of corporate entities before causing a consumer harm and potentially leave the final injured consumer without adequate redress.249 In the DePuy ASR Hip System Cases,250 a California state trial court ruled in accordance with this Note’s proposal in what was considered a move away from the Supreme Court’s trend of limiting jurisdiction.251 The state court exercised personal jurisdiction over a non-California defendant on the basis of design and consulting work performed by California-based residents and companies.252 It found that private and public interests weighed in favor of litigating the Connecticut residents’ claims in California and identified the presence of potential witnesses in California as a justification for keeping the claims in California.253 The court distinguished BMS by describing the design of the hip implant at issue as “significantly” tied to California.254 Though it goes against the Supreme Court’s recent preference to limit the availability of this type of suit, the California court’s decision is consistent with traditional notions of fair play and substantial justice.255 The reasonableness factors of personal jurisdiction can be applied to quell fears of a court’s potential overreach.256
B. Forum Shopping Concerns
Forum shopping concerns explain the reason for the strong majority in BMS257Levick, supra note 8 (“It is significant that Justice Sotomayor was not joined in her dissent by the other liberal justices on the Court. It suggests that concern among such judges over forum-shopping abuses now outweighs their socio-political affinities.”). and other cases involving nonresident plaintiffs.258 Although this proposal to expand when states can exercise specific jurisdiction would appear to raise concerns about forum shopping, the practice is simply a reality of litigation, and not a problem that can ever be completely solved.259 Corporations often take great care to incorporate their businesses and maintain their headquarters in states considered friendlier to business and less friendly to consumers in order to avoid being subject to general jurisdiction in states they feel could rule against them.260 The notion of subjecting a corporation to personal jurisdiction connected with express acts it took within a forum would merely align the law to ordinary expectations. It is not unreasonable to think that if a company takes substantial steps in a forum to bring products to other markets, it has purposefully targeted the forum and should expect to be sued there if a party experiences a harm related to the company’s decisions arising from actions that took place in the forum.261 Such an exercise of jurisdiction also complies with traditional notions of fair play and substantial justice.262
CONCLUSION
The United States Supreme Court has dramatically narrowed the situations in which a company can be sued in both federal and state court.263 While traditional fairness and due process principles remain, the Court’s more recent personal jurisdiction jurisprudence seems to prefer rigid, bright-line rules over more realistic, flexible standards.264 These inflexible rules risk violating the very principles on which personal jurisdiction is based265 and create inconsistency.266 Following BMS, future plaintiffs suing large multinational corporations stand to have their access to courts restricted because of an overly broad reading of the decision. The Court’s strong language, taken together with its general trend and practice of limiting courts’ exercise of personal jurisdiction, moves to further limit plaintiffs’ access to courts to prosecute real harms that can affect large groups of people. When a company’s connections and conduct in a state are so persistent and render it benefits to the tune of millions of dollars in profit, subjecting it to personal jurisdiction in the forum with those contacts does not violate due process standards. Courts should apply BMS cautiously and take care to analyze a defendant’s connection to a state individually—not in relation to its connection to other states.