Stepping Back to Move Forward: Expanding Personal Jurisdiction by Reviving Old Practices

Publication year2018

Stepping Back to Move Forward: Expanding Personal Jurisdiction by Reviving Old Practices

Matthew P. Demartini

STEPPING BACK TO MOVE FORWARD: EXPANDING PERSONAL JURISDICTION BY REVIVING OLD PRACTICES


Abstract

This Comment analyzes personal jurisdiction through the lens of Bristol-Myers Squibb v. Superior Court. Courts have, for years, been split on the degree of relatedness required between the claim and the defendant's contacts with a forum when analyzing specific jurisdiction. While the Supreme Court recently intervened in an attempt to clarify the issue and articulate a single test for relatedness, this Comment argues that the Court's entire personal jurisdiction framework is flawed. The main problem is an overemphasis on the defendant's contact with the forum. The result of this emphasis is that courts rarely, if ever, consider fairness as a dispositive factor in the analysis. And when courts try to expand the scope of jurisdiction under this contact-focused approach, the resulting opinions can be confusing or otherwise flawed.

This Comment argues that the best way to expand the scope of state personal jurisdiction is to return to a melange approach, under which each factor weighing on the overall fairness of exercising personal jurisdiction is considered alongside the others. This approach has several advantages over the Court's current framework. Expanding personal jurisdiction through the melange would reduce the resources currently being spent on pre-discovery litigation, and would allow more cases to move forward past the pleading stage and closer to being resolved on their merits. Reducing litigation costs would in turn encourage access to courts. Furthermore, because the melange considers the forum state's interest in adjudicating a case as a coequal factor, it encourages courts to consider the role of states as separate sovereigns. Finally, the melange would promote a fairness-based view of due process by making fairness the central question to be asked and answered in every personal jurisdiction case.

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Introduction........................................................................................811

I. Background: The Rise and Fall of the Melange......................814
A. The Rise of the Melange ............................................................ 814
B. The Melange Takes a Back Seat: Hanson Through Burger King............................................................................................ 818
C. Specific Jurisdiction Today: Disorder "Arising out of or Relating to" a Muddled Theory................................................. 822
II. Bristol-Myers Squibb Co. v. Superior Court: Making Sense of the Opinions................................................................................826
A. The California Supreme Court's Opinion ................................. 827
1. A "Sliding-Scale" Test for Relatedness............................... 828
2. The Fundamental Fairness of Litigating in California ....... 831
B. Analysis: Reasonable Result, Unreasonable Opinion ............... 832
1. A Reasonable Result............................................................ 833
2. An unreasonable opinion ................................................... 834
C. Supreme Court Intervention: More of the Same........................ 837
III. Returning to the Melange: Stepping Back to Move Forward...........................................................................................839
A. The Melange: A Reasonable Way to Expand Personal Jurisdiction ................................................................................ 839
1. Streamlining Litigation and Resolving Disputes on Their Merits .................................................................................. 840
2. Respecting State Sovereignty ............................................... 843
3. Focusing on Fairness .......................................................... 844
B. Bristol-Myers Squibb Under the Melange ................................ 846
1. BMS' Contacts with California ........................................... 846
2. California's interest in the Litigation .................................. 847
3. The Nonresidents' Interest in Litigating in California........ 848
4. The Overall Convenience of Litigating All Claims in California ............................................................................ 849

Conclusion............................................................................................851

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Introduction

In March 2012, eight complaints were filed in a San Francisco Superior Court, each alleging the same thirteen causes of action against the same defendant.1 The plaintiffs were 678 individuals, each of whom had been prescribed and had taken the drug Plavix.2 Their complaints alleged injuries resulting from having taken the drug.3 The defendant was Bristol-Myers Squibb Company (BMS), the manufacturer of Plavix.4 BMS is not a small company; it employs a workforce of over 12,000, maintains research facilities in California, and in California alone sold $918 million worth of Plavix over a six-year period.5 BMS moved to quash service of process on the grounds that California lacked personal jurisdiction with respect to the nonresident plaintiffs' claims.6 The Superior Court denied the motion, and BMS appealed.7

The issue was whether the nonresident plaintiffs' claims arose from BMS's contacts with California.8 Only eighty-six of the plaintiffs reside in California; the rest were spread across thirty-three other states.9 The 592 plaintiffs who did not reside in California (the nonresident plaintiffs) were all injured by drugs they took outside California.10 Furthermore, BMS did not manufacture those drugs in California, and the drugs did not even pass through California while being distributed to the nonresident plaintiffs.11 For these 592 plaintiffs, the connection between their claims and BMS's activities in California would appear nonexistent. The California Supreme Court disagreed, and in August 2016 held that jurisdiction was proper in California.12

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Why was Bristol-Myers Squibb notable? Because it was one of the first cases to address specific jurisdiction since Daimler AG v. Bauman.13 There, the Court confirmed a shift in general jurisdiction jurisprudence that it had begun in 2011.14 Prior to 2011, courts analyzed general jurisdiction as a question of whether a defendant had "continuous and systematic" contacts with a forum state.15 In 2011, the Court qualified this test to establish the current standard; now the defendant's contacts must be "so 'continuous and systematic' as to render [it] essentially at home in the forum."16 Daimler clarified this standard. Generally a corporation will be "at home" only in the states where the corporation is incorporated and where it has its principal place of business.17

While Daimler severely limited general jurisdiction, it also hinted at an expanding role for specific jurisdiction.18 Commenters and attorneys noticed this hint, and now seek ways to expand specific jurisdiction.19 Because the nonresident plaintiffs could not directly trace their injuries to BMS's California activities,20 Bristol-Myers Squibb presented an opportunity to try such an expansion. Unfortunately, this opportunity would be short-lived.21

Why focus on expanding the scope of specific jurisdiction when courts are already swarming with litigants?22 Because litigating jurisdiction wastes both judicial and party resources at the pleading stage, before a dispute can be

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resolved on its merits.23 Making jurisdiction easier to establish would streamline litigation by avoiding lengthy disputes at the pleading stage.24 It would also expand access to the courts and ensure that the injured have an opportunity to be made whole,25 respect state sovereignty,26 and promote the fundamental goals of due process fairness.27 These are significant values in the field of civil procedure beyond just personal jurisdiction; they underpin much of the Federal Rules of Civil Procedure,28 as well as our American democracy.29

This Comment proceeds in three parts. Part I traces the development of the Court's approach to personal jurisdiction since 1945, explaining how over time it moved from an approach that focused on the reasonableness of jurisdiction to an approach that focused primarily on whether the defendant has any contact with the forum.30 Part II then discusses how the California Supreme Court articulated a broad view of the scope of specific jurisdiction and arrived at a fair result in Bristol-Myers Squibb31 However, the California Supreme Court's reasoning was convoluted, and the Supreme Court eventually reversed it in an opinion that doubled down on a contacts-centric approach.32 Finally, Part III concludes that the best way to expand the scope of specific jurisdiction while avoiding the confusion apparent in the Bristol-Myers Squibb decision is to return to "the melange"—an approach to personal jurisdiction that the Supreme Court last utilized in 1957.33

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I. Background : The Rise and Fall of the Melange

The modern distinction between specific and general personal jurisdiction can be traced back to the Court's decision in International Shoe Co. v. Washington .34 In that case, the Court departed from nearly seventy years of personal jurisdiction jurisprudence—which had focused on the territorial boundaries of the states as the guideposts for constitutional exercises of jurisdiction35 —in favor of a more liberal interpretation.36 After International Shoe, the constitutionality of personal jurisdiction no longer depended on the defendant's consent to jurisdiction or presence in the forum. Personal jurisdiction in a forum would satisfy due process so long as the defendant had "certain minimum contacts . . . such that the maintenance of the suit does not offend 'traditional notions of fair play and...

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