The U.S. Supreme Court’s recent decision involving Ford Motor Co.—affirming that the automaker could be sued in the home states of plaintiffs injured in car accidents that occurred there—was quickly characterized by commentators as a victory for plaintiffs, and a flat-out defeat for corporate defendants.
No doubt, defendants would have preferred a different outcome. But this misses the full picture. In Ford, the court also went out of its way to forcefully reject plaintiff-friendly ‘forum shopping,’—a pervasive issue for corporations.
Ford involved allegedly-defective used cars that had been purchased outside the forum states, sold to forum-state residents, then involved in accidents in the forum states that injured forum-state residents. Though conceding that it sold other cars of the same model in those states, Ford argued that it was not subject to jurisdiction, because the particular cars involved were not designed, manufactured, or sold in the forum states.
Unanimously disagreeing, the court held that exercising jurisdiction over Ford was consistent with precedent: particularly, World-Wide Volkswagen Corp. v. Woodson.
Relevant jurisprudence in this area goes back to 1945 in International Shoe v. Washington, where the Supreme Court articulated the concepts of “general” and “specific” jurisdiction. Since then, a line of cases have basically held that a non-forum defendant is subject to suit wherever it “purposely avails” itself of the laws of that forum, and its challenged conduct “arises from or relates to” its forum contacts.
These holdings are particularly relevant in mass tort and product liability cases, where plaintiffs often seek to amass cases in particular state courts, regardless of where the individual plaintiffs actually live or were injured. Plaintiffs say this promotes efficiency. Defendants call it “forum shopping,” as such cases only appear in fora perceived to be “plaintiff-friendly.”
Over time, the court has issued several decisions clarifying that jurisdiction is only proper when the specific claim has a connection to the forum at issue, such as World Wide Volkswagen, Helicopteros Nacionales v. Hall, and Asahi Metal Industry Co. v. Superior Court.
Significantly, the court held in Bristol-Myers Squibb Co. v. Superior Court that non-resident plaintiffs who did not purchase or use an allegedly-defective medicine in California could not sue the maker of that medicine there, even though the defendant had a corporate presence in California and sold the same medicine there. The court observed what is “needed—and what is missing here—is a connection between the forum and the specific claims at issue.”
Bristol-Myers, decided 8-1 with Justice Sonia Sotomayor dissenting, was seen as a boon for defendants, making it harder to file consolidated tort cases in a single state court. Nevertheless, Bristol-Myers left open questions about whether specific claims “arise from or relate to” the defendants’ alleged forum contacts.
Some court-watchers were surprised when certiorari was granted in Ford because of Ford’s position. Essentially, Bristol-Myers meant a defendant could only be subject to specific jurisdiction where it sold, designed, or manufactured the specific product at issue. This was a narrow view of Bristol-Myers, particularly in cases where plaintiffs were forum residents suing in their home states for injuries occurring there.
Despite speculation that a new, more conservative court might bite on Ford’s proposed rule, it did not. Although defendants did not get everything they may have wanted, Ford does have a silver lining.
First, the court’s analysis is tailored to the facts presented. The court focused on Ford’s nationwide sales and marketing activities related to cars—inherently portable and long-lasting products that are designed to travel—to reach its conclusion that even if the specific cars involved were sold in different states, Ford could reasonably expect them to eventually end up injuring people in other states, where Ford could be sued. The court’s detailed factual analysis will likely be distinguishable in future cases involving—for example—single-use products, or products only marketed in particular places. And the court goes out of its way to say what it’s not deciding: jurisdictional issues related to internet sales are left an open question.
More significantly, the court took strides to distinguish and reaffirm Bristol-Myers, with Sotomayor now in the majority. It was critically different in Bristol-Myers, the court noted, that the plaintiffs in that case were not residents of the state where they had chosen to bring their claims, nor had they purchased or used the defendant’s allegedly defective product there, rendering jurisdiction over their claims unconstitutional. And the court was direct: “In short, the [Bristol-Myers] plaintiffs were engaged in forum-shopping—suing in California because it was thought plaintiff-friendly, even though they had no tie to the State.” (Slip Op. at 16).
Expressly calling out “plaintiff-friendly forum shopping” for what it is goes beyond what the court said in Bristol-Myers itself, and is not something the court has previously done in the mass tort context. Not only does it confirm—even strengthen—Bristol-Myers, it sends a clear signal to lower courts to be suspicious whenever an out-of-state plaintiff shows up in a state court seeking to sue an out-of-state defendant.
The Supreme Court’s endorsement of this “forum shopping” language is a powerful rhetorical tool for the defense bar, and may well be the most lasting impact of Ford.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.