A path to the Golden State will likely be closed in the coming months for class action plaintiffs. On January 19, 2017, the U.S. Supreme Court granted a petition for writ of certiorari in Bristol-Myers Squibb Co. v. Superior Court, 377 P. 3d 874 (Cal. 2016), an August 2016 decision by the California Supreme Court. The question presented is whether out of state plaintiffs’ claims arise out of or relate to a defendant’s forum activities – sufficient to establish specific jurisdiction – when there is no causal link between those forum contacts and the claims. The case is expected to be set for argument and decided this term.
The jurisdictional landscape saw a seismic shift in 2014 as a result of the U.S. Supreme Court’s decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014), which strictly limited the extent to which courts can exercise general jurisdiction in nationwide class actions over non-resident corporate defendants. At virtually the same time, the Supreme Court also re-affirmed that an assessment of specific jurisdiction must focus on a defendant’s “suit-related conduct” and not on plaintiffs’ relationship with the subject forum. Walden v. Fiore, 134 S. Ct. 1115, 1121 (2014). As explained and discussed in our recent post, Allen Garrett, Personal Jurisdiction Over Non-Resident Class Members: An overlooked defense in nationwide class actions? Jan. 3, 2017, in tandem these decisions should be applied to reduce the size and exposure of class claims by challenging and in many instances eliminating non-resident class members from a putative class action against a non-resident defendant.
The Walden court did not define what is meant by “suit-related conduct.” Nor is there prior Supreme Court precedent controlling that determination. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 415 n. 10 (1984) (declining to decide “what sort of tie between a cause of action and a defendant’s contacts with the forum is necessary to a determination that either connection exists.”). As a result, a split emerged among the courts, both federal and state. The vast majority (nine circuits along with the highest courts of Arizona, Massachusetts, Oregon, and Washington) have ruled that a plaintiff’s case does not “relate to or arise out of” a defendant’s forum contacts unless those contacts caused the injury alleged in some manner. Some of these courts express the relatedness requirement in “but for” terms, while others reference “proximate cause” or...
