The recent Supreme Court ruling in two consolidated cases involving products liability actions against Ford Motors may be the end of jurisdictional jurisprudence as we know it. See generally Ford Motor Co. v. Mont. Eighth Judicial Dist. Ct., No. 19-368 (U.S. Mar. 25, 2021). Throughout the last decade, the late Justice Ginsburg, writing for the majority, led the Court in applying sound legal judgment and policy interpretation to narrow the scope of personal jurisdiction to fit the modern state of our country. See Daimler AG v. Bauman, 571 U.S. 117 (2014); Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011). But now, the Court has shifted, creating a precedent that could widen that scope and open up endless forum choices for plaintiffs bringing actions against companies that conduct business nationwide.
Every litigator has heard the jurisdictional standard laid out in International Shoe and most could probably recite it: “[I]n order to subject a defendant to a judgment in personam . . . he [must] have certain minimum contacts with [the forum] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’” See Int’l Shoe Co. v. Washington, 326 U.S. 310 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). But this landmark decision left open a back door, making corporations subject to jurisdiction in any forum where they have conducted business if a court finds their contacts to be “systematic and continuous.” Id. at 317. See also Eugene F. Scoles et al., Conflicts of Law 348–52 (3d ed. 2000).
In an attempt to rein in such overarching jurisdiction, the Court observed in Goodyear and Daimler that general jurisdiction should not be used as a tool for plaintiffs to bring suit against large corporations in essentially any forum across the United States. See Daimler AG, 571 U.S. at 122; Goodyear, 564 U.S. at 919. To protect against this, Justice Ginsburg established the “at home” doctrine, limiting general in personam jurisdiction to a corporation’s principal place of business (determined by the “nerve center test”—and most commonly indicating where a company’s headquarters is located) and the state or states of incorporation. Id.; see also Hertz v. Friend, 559 U.S. 77 (2010) (ruling on the application of the nerve center test in determining a corporation’s principal place of business—where the company’s main officers direct activity). While some legal debate has ensued concerning whether “at home” could also include contacts with a forum that are so substantial that a corporation could be subject to general jurisdiction outside the two specified forums, the doctrine has yet to be applied to a case in that way. See generally D.E. Wagner, “Hertz So Good: Amazon, General Jurisdiction’s Principal Place of Business, and Contacts Plus as the Future of the Exceptional Case,” 104 Cornell L. Rev. 1085 (2019); Tanya J. Monestier, “Where Is Home Depot “At Home”?: Daimler v. Bauman and the End of Doing Business Jurisdiction,” 66 Hastings L.J. 233 (2014); Carol Andrews, “Another Look at General Personal Jurisdiction,” 47 Wake Forest L. Rev. 999 (2012).
Justice Ginsburg’s “at home” doctrine closed the door on extensive general jurisdiction, forcing plaintiffs to try to mold specific jurisdiction to their favor instead. Typically, contacts with the forum state have only given rise to specific jurisdiction when those contacts are directly related to the cause of action alleged. See International Shoe, 326 U.S. at 321; World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 298 (1980). Such a relational test maintains the integrity of state sovereignty within territorial limitations. See Hanson v. Denckla, 357 U.S. 235, 251 (1958). “But the ‘primary concern’ is ‘the burden on the defendant.’” Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773, 1780 (2017) (quoting World-Wide Volkswagen Corp., 444 U.S. at 292).
In two recent cases, the plaintiffs in both asserted varying product liability claims against the defendant, Ford Motors. See Ford Motor Co. v. Mont. Eighth Judicial Dist. Ct., 443 P.3d 407 (Mont. 2019); Bandemer v. Ford Motor Co., 913 N.W.2d 710 (Minn. Ct. App. 2018). In moving to dismiss for lack of personal jurisdiction in both cases, Ford claimed it was not subject to suit in the forum because the vehicles in contention were not manufactured, designed, assembled, serviced, or sold there. Montana Eighth Judicial District Court, 443 P.3d at 411; Bandemer, 913 N.W.2d at 714. The lower courts in both cases denied Ford’s motion and ruled in favor of exercising specific jurisdiction over Ford; both cases were affirmed on appeal. Montana Eighth Judicial District Court, 443 P.3d at 418; Bandemer, 913 N.W.2d at 716.
In determining specific jurisdiction, courts must first analyze whether a state’s long-arm statute would empower it to extend jurisdiction and then analyze the constitutionality of such an extension. Montana Eighth Judicial District Court, 443 P.3d at 412. In the two states relevant to the Ford cases, Montana and Minnesota, long-arm statutes had been enacted giving the states broad jurisdiction. In Montana, where a defendant’s actions, no matter where those actions take place, lead to injury constituting a tort within the state of Montana, a court is authorized to exercise jurisdiction over the defendant. Id. at 412 (citing Mont. R. Civ. P. 4(b)(1)). And Minnesota allows courts to exercise jurisdiction over any defendant as long as that jurisdiction is constitutional. Bandemer, 913 N.W.2d at 714. Thus, in both cases, the contacts with the forum had to be tested under a constitutional standard. See Montana Eighth Judicial District Court, 443 P.3d at 413; Bandemer, 913 N.W.2d at 714.
In the Montana case, the court focused on Ford’s purposeful availment of the forum. Montana Eighth Judicial District Court, 443 P.3d at 413. In Worldwide Volkswagen, the Supreme Court ruled that where a defendant “delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum State[,]” they must be subject to personal jurisdiction. World-Wide Volkswagen Corp., 444 U.S. at 298. Subsequently, in a plurality opinion, Justice O’Connor suggested that merely supplying the product in the stream of commerce was not enough—that the defendant would have to have acted in some way that demonstrated its “intent or purpose to serve the market in the forum State[.]” Asahi Metal Indus. Co. v. Super. Ct. of Cal., Solano Cty., 480 U.S. 102, 112 (1987). In the Montana Eighth Judicial District Court case, the Supreme Court of Montana adopted Justice O’Connor’s approach to the stream of commerce test but found that Ford met both requirements nonetheless. 443 P.3d at 414. First, Ford placed motor vehicles and their parts into the stream of commerce with an adequate foreseeability that those products would be sold in Montana. Id. And, second, Ford displayed its intent to avail itself of Montana’s jurisdiction because (i) it advertised its products and services in the forum state, (ii) it was registered to do business in the forum state, (iii) it owned dozens of dealerships within the forum state, and (iv) it conducted repairs and replacements in the forum state. Id. The court then turned to whether the plaintiff’s claims arose out of Ford’s interactions with the forum. Id. at 415. The court there found that as a car manufacturer, Ford was aware that its products would cross state lines, and therefore, because it otherwise purposely availed itself of the forum, jurisdiction must stand out of “fairness and reasonableness[.]” Id. at 416. The court failed, however, to make any connection between the plaintiff’s cause of action and Ford’s explicit contacts with the Montana forum—a glaring discrepancy between the court’s ruling and the policy it cited to support it.
Meanwhile, in Minnesota, the court broke down the constitutionality of exercising jurisdiction into a five-factor test: (i) the amount of contacts the defendant has with the forum state, (ii) what those contacts are, (iii) the connection between those contacts and the plaintiff’s cause of action, (iv) the forum state’s interest in resolving the dispute, and (v) the convenience of both parties. Bandemer, 913 N.W.2d at 714. Ford contested only the third factor, confident that without any real and stable connection between its contacts with the forum and the plaintiff’s claims, exercising personal jurisdiction would be unconstitutional. Id. The court denied Ford’s argument and ruled that its mere advertising in the forum—specifically email solicitation, a Google AdWords campaign, and a regional marketing approach—was enough to constitute a connection. Id. Ford argued that the advertising was too attenuated to connect to the plaintiff’s cause of action. And Ford’s argument was strong—its Minnesota advertisements did not even promote the product for which the plaintiff’s claims arose. Id. at 715. Citing the Supreme Court’s decision in Bristol-Myers Squibb, Ford Motors argued that the Minnesota forum could not employ specific jurisdiction over it because none of the relevant activities to the alleged harm occurred within its borders. Id. (citing Bristol-Myers Squibb, 137 S. Ct. at 1783 (holding that relevant activities occurring out of state could not support specific jurisdiction within the state)). But once more, the court shot down Ford’s arguments, claiming that its affirmation of specific jurisdiction could be reconciled with the holding in Bristol-Meyers Squibb, going to great lengths to strain the contacts doctrine.
Stretching the Bristol-Myers Squibb holding far past its limits, the Minnesota Court of Appeals contended that a two-part rationale justified sufficient contacts with the forum: (i) the plaintiff was a Minnesota resident, injured in Minnesota, in a vehicle registered in Minnesota; and (ii) Ford has substantial marketing in Minnesota (irrespective of what product was being marketed). Id. at 716. Notably, the court could not—and did not attempt to—connect the plaintiff’s contacts in the first factor to Ford’s marketing activity, yet it still ruled, against existing jurisprudence, that specific jurisdiction was justified. Id. The Supreme Court of Minnesota affirmed the judgment under substantially similar reasoning. Bandemer v. Ford Motor Co., 931 N.W.2d 744 (Minn. 2019). Ford subsequently petitioned the Supreme Court for a writ of certiorari.
On January 17, 2020, the Supreme Court consolidated the Ford cases and granted certiorari on the question of specific jurisdiction where the defendant’s contacts are not directly related to the plaintiff’s cause of action. See Ford Motor Co. v. Bandemer, 140 S. Ct. 916 (2020). During oral argument, Ford’s counsel emphasized that the rulings in the petitioned cases “r[an] afoul of [the Supreme Court’s] cardinal rule that the Due Process Clause protects defendants, not plaintiffs and not forum states.” Transcript of Oral Argument at 6, Ford Motor Co. v. Mont. Eighth Judicial Dist. Ct., No. 19-368 (Oct. 7, 2020). Despite jurisprudence in favor of the defendants, the Supreme Court found that, indeed, a court can exercise jurisdiction over a company that advertises in the forum, regardless of whether a claimant can make a showing that he or she relied on such advertisement or make any other connection between the claims alleged and the defendant’s in-state conduct. See Ford Motor Co. v. Mont. Eighth Judicial Dist. Ct., No. 19-368, slip op. (Mar. 25, 2021).
The Supreme Court’s affirmance of the lower courts’ judgments in both cases threatens to give claimants a master key to the back door of any court—drastically expanding jurisdictional authority of courts and undercutting Justice Ginsburg’s legacy of jurisdiction. Whether it is through general or specific jurisdiction, allowing courts to exercise authority over parties absent a real basis for a connection between the defendant’s contacts and the plaintiff’s claim subjects corporations to possible suit in virtually any forum where they conduct business or advertise. This finding could give resident plaintiffs a powerful tool in any litigation, all but explicitly allowing them to waltz in the door of whatever is thought to be the most favorable forum in the nation.
Writing for the majority, Justice Kagan notes that “[w]hen a company like Ford serves a market for a product in a State and that product causes injury in the State to one of its residents, the State’s courts may entertain the resulting suit,” even despite the consumer transacting for the product in a different state. Ford Motor Co., slip op. at 1–2. The Court goes on to emphasize that Ford maintains 36 dealerships in the state of Montana and advertises its cars in that jurisdiction, meeting a sufficient contacts test to exercise personal jurisdiction. Id. at 3–4. Addressing the Bandemer case, the Court states that Ford’s advertisements “influence state residents” to buy Ford’s product and highlights that 2,000 of the very same car were purchased in Minnesota—the proposed forum state. Id. at 4. Still, the Court fails to make any connection between these 2,000 cars and the car that gave rise to the resident plaintiff’s cause of action. By this logic, any nationally recognized company can be haled into any forum across the country, regardless of where that company’s products were manufactured, designed, or sold, as long as the plaintiff was injured in the jurisdiction, essentially returning to the general jurisdiction standard that existed prior to the Court’s narrowing it in the landmark cases of Goodyear and Daimler. Justice Gorsuch, in his concurring opinion, points out that the majority is simply trying to open back up old doors to jurisdictional authority:
Even today, this Court usually considers corporations “at home” and thus subject to general jurisdiction in only one or two States. All in a world where global conglomerates boast of their many “headquarter[s].” . . . Maybe that’s the intuition lying behind the majority’s introduction of its new “affiliation” rule. . . . I cannot help but wonder if we are destined to return where we began. . . . The real struggle here isn’t with settling on the right outcome in these cases, but with making sense of our personal jurisdiction jurisprudence and International Shoe’s increasingly doubtful dichotomy.
Id. at 8, 9–10 (Gorsuch, J., concurring).
Allowing state courts to find jurisdiction over defendants on something as minor as internet advertisement—a posting that reaches around the globe—far exceeds the jurisdictional jurisprudence that this nation has become familiar with over the last decade. Rather, the Supreme Court’s decision here is a stark warning to companies nationwide: The back door may have just been unlocked, and specific jurisdiction could exist anywhere your business conducts sufficient activity, as long as the plaintiff can claim injury in the jurisdiction, and sufficiency may be a lower standard than you think.
Cassie Love is an associate at Weil, Gotshal & Manges LLP in New York, New York. Cohl Love is the Bernard S. Baron Scholar at Brooklyn Law School, the Balfour Scholar in the Phi Delta Phi International Legal Honor Society, and currently sits on the Board of the New York State Bar Association’s Young Lawyers Section as a Diversity Cochair.
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