Justices’ Ford Jurisdiction Opinion ‘A Step Back From The Brink’

March 29, 2021, 10:01 AM

The U.S. Supreme Court’s decision March 25 not to further limit where injured plaintiffs can sue big corporations reflects common sense and avoids a rule that would have been perceived as “too draconian,” attorneys and law professors say.

But it also poses questions for future application, they say.

Ford Motor Co. must face a pair of defect suits in the states where the accidents occurred because it served markets there, including “advertising, selling, and servicing the model of vehicle the suit claims is defective,” Justice Elena Kagan said for the 8-0 court. Ford had argued the connections between its activities in those states and the plaintiffs’ claims weren’t close enough to satisfy due process.

Robert Peck, who wrote an amicus brief for the American Association for Justice, said this case bucked a clear trend in high court opinions since 2011 that made it harder to obtain personal jurisdiction outside of a maker’s home state.

‘Common-Sense Approach’

This decision “returns to a common-sense approach,” said Peck, who’s with the Center for Constitutional Litigation in Washington. The AAJ advocates for plaintiffs’ lawyers.

An opinion from Justice Ruth Bader Ginsburg narrowed general, or all-purpose, jurisdiction in 2014’s Daimler AG v. Bauman “with the expectation that specific jurisdiction would be more widely available,” he said. Last week’s decision, involving jurisdiction linked to specific cases, is “a step back from the brink,” he said.

Julie Siegel, an attorney for a plaintiff whose case against Ford was dismissed in 2019, said that several cases had “made huge changes to minimum contacts” needed for specific jurisdiction. “This certainly helps bring it back.”

In that case, a daughter alleged her father crashed his Ford Fusion into a pole and died after the car’s steering wheel came off. But the court tossed the case because the car was sold in another state.

“I don’t think my case could or would have been dismissed,” had the court’s new opinion been in place then, Siegel said. She practices in Clayton, Mo.

Professor Lea Brilmayer of Yale Law School, whose formulation that general jurisdiction exists over corporations where they are “at home” was adopted in Daimler, said that “after the sharp restrictions in the last 10 years, another sharp restriction would have been too draconian.”

Clarity, Application

But the court didn’t provide more clarity, Brilmayer said. It finds specific jurisdiction is “a meaningful limitation,” allowing jurisdiction in some cases but not others, she said. But it doesn’t say what the test is, she said.

The justices rejected Ford’s proposed test for specific jurisdiction, in which a court outside a company’s home state could hear a case against it only if the company’s actions there caused the harm. Even an ally of Ford’s that submitted a brief, the Product Liability Advisory Council, didn’t go quite so far.

M.C. Sungaila of Buchalter APC in Irvine, Calif., an appellate attorney for businesses and others, said the court’s language recognizing jurisdiction where the claim is “related to” the in-state contacts “gives rise to some uncertainty about how broadly the jurisdictional hook will be applied—and how it might be applied to smaller companies or solo entrepreneurs.”

“The concurrences both highlight this new approach (Alito), and observe that the jurisdictional test may soon need to be adjusted to account for the internet age (Gorsuch),” she told Bloomberg Law in an email, referring to Justices Samuel A. Alito Jr. and Neil M. Gorsuch, the latter of whom questioned the use of a nearly 80-year-old jurisdictional case that has had long-standing precedential value.

For Peck, the court’s approach means that “the relationship Ford has with its cars,” and customers, “doesn’t end with the sale.” That “continuing relationship” will have significance in other cases, he said.

To contact the reporter on this story: Martina Barash in Washington at mbarash@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Steven Patrick at spatrick@bloomberglaw.com

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