Heavyweight Jurisdiction Fight Set to Be Argued at Supreme Court

Ford Motor Co. is expected to argue for tight limits on where companies can be sued outside their “home” states when the U.S. Supreme Court, missing one of its leading voices on jurisdiction issues, hears a pair of crash cases Wednesday.

Courts in Montana and Minnesota allowed product liability suits against Ford, involving a death and injury in those states, to proceed. But the cars at the center of the suits were sold in other states. And Ford argues the connections between its activities in those states and the plaintiffs’ claims aren’t close enough to satisfy due process.

The two state courts’ views “would subject large nationwide manufacturers to suit anywhere they advertise or do business or sell other products,” Washington Legal Foundation attorney Cory Andrews said. WLF is a public interest law firm and think tank that advocates in favor of business and a free market.

But Professor Alan Morrison of GW Law at George Washington University said that if the court adopts Ford’s proposed test for specific personal jurisdiction—that the defendant’s activities in the state caused the harm—it will be very difficult for injured plaintiffs to sue product makers. Morrison joined three other law professors in an amicus brief supporting the plaintiffs.

Personal jurisdiction, often a feature of disputes involving allegedly defective products, also comes up in other types of cases. Supreme Court cases also have dealt with suits that involved defamation, contracts, and civil rights.

Good arguments exist on both sides, according to Andrews and a jurisdiction scholar, Professor Lea Brilmayer of Yale Law School. “A decision either way could be defensible,” Brilmayer said.

The late Justice Ruth Bader Ginsburg authored two of the court’s most significant precedents on jurisdiction in recent years and has been in the majority on most others.

“Her absence will hurt the rationalization of personal jurisdiction,” said a plaintiff-side appellate attorney, John Vail, who’s based in Washington. “I don’t think the court has a coherent jurisprudence at this point.”

Ginsburg “was absolutely brilliant on jurisdictional issues.” Brilmayer told Bloomberg Law. The justice “always got jurisdiction correct” and wasn’t biased for one side or the other, she said.

And this case, which drew numerous friend of the court briefs, could be quite significant, Brilmayer said. “This is not a nickel-and-dime case.” It may be more important than Bristol-Myers Squibb Co. v. Super. Ct., she said, referring to a 2017 Supreme Court jurisdiction case with wide impact.

Bristol-Myers disallowed nonresident plaintiffs from suing drugmaker Bristol-Myers in California, which they sought to do on the basis of its extensive activities there, and set the stage for Ford’s arguments in these cases and around the country.

The justices in Bristol-Myers could have resolved additional issues but set them aside, Brilmayer said. “They’re all going to come up and have to be decided now.”

‘Arise Out of or Relate To’

The specific jurisdiction analysis derived from Supreme Court precedent is usually understood to have three parts, grounded in the due process clause of the Constitution.

The first has to do with the defendant’s purposeful contacts with the state, by which it invokes “the benefits and protections of its laws.” The second, at issue in the Ford litigation, is that the suit “must arise out of or relate to the defendant’s contacts with the forum.” The third is that jurisdiction must be reasonable.

This case doesn’t concern the first part, James C. Martin of Reed Smith LLP in Pittsburgh and Los Angeles told Bloomberg Law. “There’s no debate Ford has that kind of presence in both states that are implicated.”

Rather, “this is a more discrete question whether or not the defendant has to have contacts in the forum that are specifically related to the causes of action brought by the plaintiffs,” said Martin, who co-wrote an amicus brief for DRI—The Voice of the Defense Bar in support of Ford.

In these cases, “the actual language that the court uses is now going to be defined more particularly,” he said.

To Brilmayer, what’s interesting about these cases is that they revolve around “other cars and trucks that were sold” in the two states.

“The question is, is that sort of activity related to the cause of action or does the cause of action arise out of that forum activity?” she said. “And that’s the issue that the Supreme Court has been gently pushing aside.”

“This is something that’s been left to stew in the lower courts for about 40 years,” she said.

Ford Wants ‘Cause’ Requirement

Plaintiffs in both cases fault defects in the vehicles for the accidents. A divided Minnesota Supreme Court said Adam Bandemer’s injury claims arose out of or were related to Ford’s contacts with Minnesota, citing the automaker’s sales and marketing efforts in the state.

And the Montana Supreme Court allowed a suit against Ford concerning an SUV it sold in Washington state that allegedly caused the death of driver Markkaya Jean Gullett in Montana. The Montana court said her use of the vehicle is tied to Ford’s activities there, including “selling, maintaining, and repairing vehicles.”

Ford argues Supreme Court precedent doesn’t create a separate “related to” prong. “Specific jurisdiction requires a causal link between a defendant’s forum contacts and a plaintiff’s claims,” it told the court in a brief.

The U.S. Solicitor General’s office, a group of states, and numerous other amici also have chimed in, many proposing different tests.

Andrews, who co-authored an amicus brief for the Washington Legal Foundation, said that “the main test that matters” for the Supreme Court argument is Ford’s, which is “a kind of proximate cause test.”

“That’s where the court’s attention is going to be, and I‘m not sure how the court will come down on that question,” he said.

To Morrison, “What they’re trying to do is engage in their own forum shopping, to be in a place that has nothing to do with the accident in question.”

“They want to be sued in Michigan or Delaware,” Morrison said. That’s where Ford is headquartered and incorporated, respectively. Michigan law in particular is considered favorable to automakers.

Also, plaintiffs who sue outside the state where the accident occurred can’t join other potential defendants, he said.

Defendants are “happy to be able to point to the empty chair and say, not us—it’s the guy who’s not here in this courtroom. It’s terribly inefficient for the judicial system. And it’s unfair for the plaintiffs,” he said.

Why Go to Michigan?

Andrews said the plaintiffs in the Ford cases weren’t forum-shoppers and have a good argument: “Why should a resident of Montana or Minnesota have to go to Michigan to sue the manufacturer of his car?”

“I’m sure that there will be some justices concerned about ensuring that people who are injured will have remedies available and access to courts,” he said.

“But some justices will be concerned about the broader implications for the economy and the unintended consequences of loosening up that rule too much,” Andrews said.

To Martin, due process and high court precedent both provide constraints on the exercise of jurisdiction. Those constraints “are going to be at work in how the justices analyze this jurisdictional question,” he said.

But Vail said it’s “not intellectually consistent” to deny jurisdiction over Ford “when it markets everything nationally, does everything nationally.”

The only way to do it is to return to a centuries-old, territory-based doctrine “that dealt with your ability to control the things physically within your power,” he said.

“To me, there are two big threads about where the court might go,” said Vail. “The intellectual divide is, is personal jurisdiction about territory, or is it about fairness?”

The case is Ford Motor Co. v. Mont. Eighth Judicial Dist. Ct., U.S., No. 19-368, oral argument 10/7/20.