The Class Action Struggle: Should Bristol-myer's Limit on Personal Jurisdiction Apply to Class Actions?

• Publication year: 2021

The Class Action Struggle: Should Bristol-Myer's Limit on Personal Jurisdiction Apply to Class Actions?

John Mikuta

THE CLASS ACTION STRUGGLE: SHOULD BRISTOL-MYERS'S LIMIT ON PERSONAL JURISDICTION APPLY TO CLASS ACTIONS?

Abstract

In Bristol-Myers Squibb Co. v. Superior Court of California, the Supreme Court held that, in a coordinated mass action, a court may not exercise specific personal jurisdiction over claims from non-resident plaintiffs who did not suffer their injuries in the forum state. The Court, however, did not explicitly state whether and how its holding would apply to class actions. In March 2020, federal appellate courts began to be confronted with the issue. While the D.C. Circuit in Molock v. Whole Foods Group, Inc. side-stepped the personal jurisdiction question, Judge Silberman's dissenting opinion argued that the logic of Bristol-Myers should apply to class actions as it does to mass actions. In Mussat v. IQVIA, the Seventh Circuit disagreed, concluding that the differences between class actions and mass actions are sufficient to distinguish the holding of Bristol-Myers as applied to the class action context.

This Comment will argue that Bristol-Myers should not be extended to class actions. Doing so would cause a momentous shift in class action law that is not supported by the Bristol-Myers opinion. In addition, as Mussat recognizes, mass actions are significantly different from class actions, as class action members are not true parties to a class action as mass action plaintiffs are to a mass action. Moreover, Federal Rule of Civil Procedure 23, which sets forth standards for appropriate certification of class actions, provides a sufficient procedural basis for protecting defendants' due process rights. Finally, applying Bristol-Myers to class actions would defeat the policy purposes of the class action device and harm the overall efficiency of the litigation system.

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Introduction.............................................................................................327

I. The Development of the Modern Class Action.......................329

A. The Beginnings of the Class Action .......................................... 330
B. Policy Purposes of Class Actions ............................................. 332

1. Judicial Efficiency .............................................................. 333
2. Compensation of Victims.................................................... 334
3. Deterrence .......................................................................... 334

II. The Supreme Court's Personal Jurisdiction Jurisprudence . 335

A. Establishing the Modern Personal Jurisdiction Framework .... 336
B. The Gradual Narrowing of Personal Jurisdiction.................... 337
C. The Bristol-Myers Decision ...................................................... 341

III. The Difference of Opinion Forms ...............................................345

A. Molock v. Whole Foods Group, Inc......................................... 346
B. Mussat v. IQVIA ...................................................................... 349
C. Summary ................................................................................... 350

IV. Nonnamed Class Members Should Not Be Required to Show Personal Jurisdiction over the Defendant with Respect to Their Claims...............................................................351

A. The General Consensus Before Bristol-Myers ......................... 351
B. Class Members Are Not Full Parties to a Class Action ........... 356

1. Inherent Differences Between Class Members and Mass Action Plaintiffs .................................................................. 356
2. Class Members Are Not "Parties" for Personal Jurisdiction Purposes ......................................................... 358

C. Rule 23 Provides Sufficient Procedural Protections to Defendants by Ensuring that Each Class Member Is Similarly Situated and Is Bringing Essentially the Same Claim .............. 361
D. Applying Bristol-Myers to Class Actions Would Inhibit Both the Policy Goals of Class Actions and Impair the Overall Efficiency of the Judicial System .............................................. 363

V. Concerns and Implications .........................................................366

Conclusion.................................................................................................368

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Introduction

Class action lawsuits occupy a distinctive and important sphere in the American litigation landscape. An exception to the original concept of litigation as "strictly a two-party affair—one plaintiff against one defendant"—class actions allow groups of similarly situated plaintiffs to bring common claims through named representatives.¹ Some of the most famous cases in U.S. history, including Brown v. Board of Education² and Roe v. Wade,³ have been class actions. In addition, class actions have accounted for some of the largest settlements ever recorded, often numbering in the billions of dollars.⁴

Although the class action has effectively cemented its place as a tool for group litigation, it now faces a grave challenge to its effectiveness.⁵ In 2017, the U.S. Supreme Court decided Bristol-Myers Squibb Co. v. Superior Court of California, which held that California could not exercise specific personal jurisdiction over the claims of nonresident plaintiffs because "all the conduct giving rise to the nonresidents' claims occurred" outside of California.⁶ Bristol-Myers, however, was not certified as a class action under California law, but instead was a coordinated mass action in which over 600 plaintiffs sued together under traditional joinder principles.⁷ As a result, Bristol-Myers did not expressly answer whether and how its holding would apply to class actions.⁸ Nevertheless, commentators did not hesitate in speculating that Bristol-Myers could require that a court have personal jurisdiction over the claims of every member of a class action.⁹

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On March 10, 2020, the D.C. Circuit decided Molock v. Whole Foods Market Group, Inc.,¹⁰ which was the first federal court of appeals case raising the issue of whether the Bristol-Myers rule applies to class actions. While the majority opinion resolved the case on other grounds, Judge Silberman's dissenting opinion reached the Bristol-Myers issue and concluded that Bristol-Myers should apply to class actions.¹¹ The very next day, the Seventh Circuit reached the opposite conclusion in Mussat v. IQVIA, Inc.¹² It is likely that this issue will continue to be addressed in federal courts of appeals and may eventually reach the U.S. Supreme Court.¹³

This Comment argues that the holding of Bristol-Myers should not extend to the class action context. The class action is a unique form of litigation with built-in protections to ensure that the due process rights of all parties are protected.¹⁴ There are significant, compelling differences between class action members and mass action plaintiffs that justify different standards for personal jurisdiction over their claims.¹⁵ Furthermore, application of Bristol-Myers to class actions would contravene the very policy purposes that the class action device serves and could render class actions ineffective.¹⁶ Without an effective class action tool available, litigants may be forced to inefficiently litigate the same issues in multiple jurisdictions and may obtain inconsistent judgments resolving those issues.¹⁷

Part I of this Comment examines the history and background of the class action device and traces its development to its modern form. It then discusses the three main policy purposes of class actions: (1) to promote judicial efficiency, (2) to ensure victims can be adequately compensated, and (3) to provide a means for deterring wrongdoing.

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Part II explores the Supreme Court's personal jurisdiction jurisprudence. First, it discusses the modern framework for personal jurisdiction established by International Shoe Co. v. Washington.¹⁸ Then, it provides an overview of the evolution of personal jurisdiction from 1945 to the present. Finally, this Part describes the Bristol-Myers opinion in detail.

Part III thoroughly examines Judge Silberman's dissent in Molock and the Seventh Circuit's opinion in Mussat, analyzing the arguments made in each opinion.

Part IV proceeds in four sections. Section A argues that applying Bristol-Myers to class actions would contradict the widespread consensus on this issue pre-Bristol-Myers, resulting in a groundbreaking shift in the law not justified by the text of Bristol-Myers. Section B highlights the differences between class actions and mass actions of the type at issue in Bristol-Myers and argues that these differences between class members and mass action plaintiffs are sufficient to distinguish the two for personal jurisdiction purposes. Section C argues that Federal Rule of Civil Procedure 23, which governs class action procedure, provides sufficient due process protections to defendants in class actions, ensuring that defendants are not unfairly harmed by not applying Bristol-Myers to class actions. Lastly, section D discusses the policy implications of extending Bristol-Myers to class actions and argues that the goals of the class action device would be impaired if Bristol-Myers were applied to class actions.

Finally, Part V addresses the broad implications that extending the holding of Bristol-Myers to class actions would have on the litigation system as a whole. This Part concludes that, in conjunction with the Court's continued narrowing of personal jurisdiction, these implications could result in aggregate litigation becoming unduly difficult, thus depriving society of the benefits that aggregate litigation models such as class actions provide.

I. The Development of the Modern Class Action

To understand fully the complexities of how Bristol-Myers's conception of personal jurisdiction could apply to...