Chapter 1 Recent Supreme Court Personal Jurisdiction Decisions Clarify Where Companies Can Be Sued and on What Bases
| Jurisdiction | United States |
GEORGE P. (TREY) SIBLEY, III is a Partner with Hunton Andrews Kurth in Richmond, VA. Trey's practice focuses on environmental permitting and litigation. Trey has served as lead litigation counsel in a diverse array of trials and appeals, including petitions for review of large infrastructure projects, major CERCLA cost-recovery actions, defense of environmental citizen suits and civil enforcement cases, consumer class actions and federal civil rights. Trey combines courtroom experience in complex trials and appeals with the substantive knowledge specific to environmental disputes arising under the federal Clean Air Act, Clean Water Act, National Environmental Policy Act and Endangered Species Act. Trey was law clerk to the Hon. Karen J. Williams of the US Court of Appeals for the Fourth Circuit from 2003-2004. He also clerked for the Hon. Robert E. Payne of the US District Court, Eastern District of Virginia, from 2002-2003. Before attending law school, Trey served as a Surface Warfare Officer in the United States Navy.
SARAH J. SORENSON is Senior Corporate Environmental Counsel at The Mosaic Company. She advises Mosaic on a wide range of federal and state environmental, health, safety, and security matters, including the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the Resource Conservation and Recovery Act (RCRA), the Clean Water Act, the Clean Air Act, the Occupational Safety and Health Act, and the Federal Mine Safety and Health Act. She provides counsel on permitting, compliance, litigation, site remediation, land use, transactional, and due diligence matters. Sarah is a graduate of Stanford Law School. Prior to joining Mosaic, Sarah worked in the Minneapolis office of Dorsey & Whitney LLP and clerked for the Honorable Diana E. Murphy on the United States Court of Appeals for the Eighth Circuit.
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Personal jurisdiction is one of the first topics law professors cover in 1L civil procedure. And in every civil action, one of the very first question courts ask is whether they actually have jurisdiction over the defendant. Given this primacy, one might expect it to be relatively simple for a company to discern where it might fairly be haled into court.
Not so much. In the ever-evolving and growing world of interstate and international commerce, businesses reach well beyond their borders. And some forums are better for plaintiffs than others, which creates a powerful incentive to test novel jurisdictional theories. This formula regularly produces fact patterns and arguments that are not squarely covered by Supreme Court precedent.
In recent years, the Supreme Court has re-engaged on personal jurisdiction and has clarified its precedent in mostly helpful ways. These decisions, which have been unanimous or nearly so, provide some clear and helpful guideposts that help businesses better understand where they can be sued. This paper will discuss some of these recent decisions, address relevant developments at the State level, and then close with some planning and practice pointers.
I. The Basics—Fair Notice and Federalism.
Before 1945, the rules governing personal jurisdiction were clear but highly restrictive. A state court's jurisdictional reach was defined by the State's borders.2 A plaintiff could sue a defendant in the courts of the defendant's home state or not at all. And that conception of due process worked well for a time.
But the transformation of interstate commerce after the industrial revolution challenged that understanding of the limits of due process. So in International Shoe, the Supreme Court adopted a more flexible and adaptable standard—the familiar "minimum contacts" test.3 A court can exercise personal jurisdiction over a defendant if the defendant has "minimum contacts" with the state where the court sits, so that "the maintenance of suit" is "reasonable" and "does not offend traditional notions of fair play and substantial justice. "4
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This test harmonizes two sets of values.5 First, it recognizes that defendants should have fair warning over where they might be sued. They should, that is, be able to "structure [their] primary contacts to lessen or avoid exposure to a given State's courts."6 Second, one State should not be allowed to encroach upon matters that rightly should be resolved by a sister State. A state with little legitimate interest in a dispute should not encroach on States more affected by the controversy.7
In the decades following International Shoe, the Supreme Court developed two categories of personal jurisdiction: "general" jurisdiction, where a defendant's contacts with a State are so pervasive that it can be sued there on any claim; and "specific" jurisdiction, under which a defendant can be sued only on a claim arising out of or related to its contacts with the forum.
A. General "All Purpose" Jurisdiction
A state court can exercise general jurisdiction (sometimes called, "all-purpose" or "dispute-blind" jurisdiction) when a defendant is "essentially at home" in the State.8 Such all-purpose jurisdiction extends to "any and all claims" that might be brought against the defendant, whether or not they arise out of the defendant's actions in the State.9 Such sweeping jurisdiction is appropriate, because the Defendant's pervasive forum contacts give it fair warning of suit, and the State has an interest in adjudicating claims against its residents and those whose contacts with the State are so continuous and systematic that they can call the State home.
The exercise of general jurisdiction is largely coterminous with the exercise of in personem jurisdiction before International Shoe—a plaintiff can sue a defendant in the defendant's home state on any cause of action. But because general jurisdiction is defined in terms of minimum contacts and not territorial boundaries, it allows for the possibility that all-purpose jurisdiction may be appropriate—in the rare case—outside the defendant's home jurisdiction. But under what circumstances?
B. Specific "Case-Linked" Jurisdiction
Specific jurisdiction allows for the exercise of personal jurisdiction where an out-of-State defendant's in-State contacts give rise to the cause of action. This category captures those situations International Shoe's more relaxed standard was meant to address. And nearly all of the Supreme Court's personal jurisdiction decisions post-International Shoe have
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elaborated on the circumstances where the exercise of this type of case-linked jurisdiction is appropriate.
Supreme Court precedent establishes several useful guideposts for the exercise of specific jurisdiction. The cause of action must "arise out of" or "relate to" the defendant's contacts with the forum.10 And the contacts in question must be purposeful—that is, the case must arise out of the defendant's purposefully availing itself of market and laws of the forum state. "[R]andom, isolated, or attenuated" contacts are not enough.11
But just how tight must be the nexus between the defendant's contacts and the cause of action?
II. Supreme Court Decisions 2011-2021: Doctrinal Clarity Disfavoring the Forum Shopper
A. General Jurisdiction=Home-State Jurisdiction
A defendant is plainly subject to this all-purpose jurisdiction in its home state. And for a corporation...
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