Personal Jurisdiction in Class Actions After Bristol-Myers Squibb: How Ford May Foreshadow the Supreme Court’s Answer
Federal circuit courts have recently split over applying Bristol-Myers Squibb Company v. Superior Court (BMS) to class actions. The Supreme Court’s watershed personal jurisdiction opinion in 2017 held that courts can only exercise specific personal jurisdiction over plaintiffs’ claims that arise out of or relate to defendants’ conduct in the forum state. But BMS did not resolve whether federal courts must find specific personal jurisdiction over absent class members in addition to named class representatives. Nor did the Court’s more recent personal jurisdiction decision in Ford Motor Company v. Montana Eighth Judicial District Court. Yet Ford, by declining to limit the exercise of specific personal jurisdiction to cases in which there is a direct causal link between plaintiffs’ injuries and defendants’ in-state conduct, may have hinted at the Court’s eventual answer.
A court’s power to resolve disputes requires both personal jurisdiction—over the parties—and subject matter jurisdiction—over the type of claim. For the exercise of personal jurisdiction to satisfy the Fourteenth Amendment’s due process clause, defendants must have “minimum contacts” with the forum state. Personal jurisdiction can be general or specific. Courts have general jurisdiction over defendants whose in-state activities render them “at home” in the forum. Assuming subject matter jurisdiction is also proper, general jurisdiction allows a court to hear all claims against a defendant—notwithstanding the location of the defendant’s conduct and the connection of the plaintiffs’ injuries thereto. If general jurisdiction is lacking, a court may still exercise specific jurisdiction if the defendant “purposefully avails” itself of the benefits of doing business in the forum state, and the plaintiffs’ injuries “arise out of or relate to” the defendant’s in-state conduct. Unlike general jurisdiction, courts must limit their exercise of specific jurisdiction to claims with a connection to activities in the forum state.
BMS was a mass tort action in California state court involving Bristol-Myers Squibb (BMS), a large pharmaceutical company incorporated in Delaware, with headquarters in New York and substantial activity in New Jersey. Over 600 consumers of a BMS-manufactured drug called Plavix sued BMS in California, alleging various claims under California law. The state’s highest court ruled that specific jurisdiction was constitutionally permissible, even though BMS’s activity in California was insufficient to establish general jurisdiction. This meant that the court could hear claims arising out of BMS’s conduct within California. But the Supreme Court reversed: The California court could not exercise specific personal jurisdiction over claims of injured plaintiffs who were not residents of California and who did not purchase Plavix through BMS’s California distributor. The Court focused on BMS’s link to California, and the small amount of business it did in that state compared to its overall operations—holding that BMS’s Fourteenth Amendment due process right required that each plaintiff’s claim “arise out of or relate to” BMS’s conduct within the forum state.
More recently, Ford refused to read BMS as a bar to two state courts’ exercise of specific personal jurisdiction. The Ford plaintiffs, similar to those in BMS, alleged injuries from products—cars rather than pills—which Ford sold outside of the forum states. Yet, over Ford’s argument that BMS required a tight connection between the defendant’s conduct, the forum state, and the plaintiff’s injury, the Court reframed BMS as a case about forum shopping—a term that describes (and often denounces) strategic forum selection. The BMS plaintiffs, the Ford Court explained, “su[ed] in California because it was thought plaintiff-friendly, even though their cases had no tie to the State.” Conversely, the Ford plaintiffs resided in the forum states, drove the allegedly defective cars in the forum states, and suffered injuries in the forum states. The Court’s reframing allowed for a broader conception of specific jurisdiction. Clinging to the latter half of the phrase, “arise out of or relate to,” the Court reasoned that the missing link in BMS need not be causal in all cases.
The ongoing viability of nationwide class actions could hinge on whether and how BMS, as refined by Ford, applies to class actions. In theory, class actions promote efficiency—reducing litigation costs and deterring unlawful behavior by providing a day in court for plaintiffs with claims too small to justify bringing individual suits. But since Rule 23 of the Federal Rules of Civil Procedure allows representative class members to allege claims on behalf of large absent classes without their affirmative consent, nationwide class actions can put defendants’ financial well-being on the line without compensating absent class members. Crucially, the ability of plaintiffs’ lawyers to collect the claims of injured plaintiffs from different states for class resolution in a single forum depends on courts’ capacity to exercise personal jurisdiction over those claims. So as several lawyers and law professors suggested in 2017, BMS appeared to mark “the end of an era” for nationwide and multistate class actions. Yet the era endures—for now at least.
Since BMS, lower federal courts have divided over whether specific personal jurisdiction—unlike subject matter jurisdiction and venue—is necessary to bind defendants with adjudications of absent class members’ claims. Most of these courts have held that if there is specific jurisdiction over the claims of representative class members, establishing personal jurisdiction over absent class members’ claims is unnecessary. In March 2020, the Fifth, Seventh, and D.C. Circuits became the first federal appellate courts to weigh in. The Sixth Circuit joined them this year. And in May 2021, the Ninth Circuit heard oral arguments on the issue in Moser v. Benefytt, Inc.
In Mussat v. IQVIA, the Seventh Circuit held in a putative class action that only named representative class members must establish a court’s personal jurisdiction over their claims, not absent class members. The court reasoned around BMS by designating the plaintiff class as a singular “litigating entity,” relying also on the Supreme Court’s consistent failure to mention personal jurisdiction in nationwide class actions. The Sixth Circuit reached a similar outcome in Lyngaas v. Curaden AG, declining to extend BMS to a class action.
By contrast, the D.C. Circuit did not reach the issue in Molock v. Whole Foods Market Group. Specifically, the court determined that the question of class certification must come before the personal jurisdiction question because putative class members do not become parties until certification. The Fifth Circuit followed similar logic in Cruson v. Jackson National Life Insurance Company.
No federal circuit court has yet extended BMS to find personal jurisdiction lacking over absent class members’ claims. But a number of federal district courts have done so, and vigorous dissents accompanied the Sixth and D.C. Circuits’ decisions. While this issue may appear ripe for Supreme Court review, the Court’s denial of certiorari in IQVIA may indicate its desire to hear from additional circuit courts.
Even if a uniform solution is several years down the pike, the Ford Court’s reasoning may shift the personal jurisdiction landscape for class actions. In many nationwide class actions under Rule 23, where the claims of absent class members lack a direct causal connection to the forum, the defendant’s activities in the forum may nevertheless be sufficient to support specific personal jurisdiction—that is, if “notions of fair play and substantial justice” require the inquiry at all. Absent evidence of forum shopping, which Ford suggested was central to BMS’s holding, the Court appears willing to adopt a flexible approach to personal jurisdiction in class actions. Indeed, the Moser plaintiffs submitted a letter to the Ninth Circuit arguing that Ford resolves the personal jurisdiction issue in their favor.
It is questionable whether class actions deserve a different personal jurisdiction standard from other civil suits, even if that is emerging as the majority approach. Arguably, the Rules Enabling Act denies Rule 23, a mere procedural device, the power to “abridge, enlarge, or modify” any substantive rights—including defendants’ due process rights, which might deprive a forum of specific personal jurisdiction over absent class members’ claims in otherwise identical individual civil suits. Nonetheless, Ford appears to foreshadow the continuing vitality of nationwide and multistate federal class actions.
Connor Cohen is a J.D. candidate (’22) at Northwestern University Pritzker School of Law and a Managing Editor of Volume 116 of the Northwestern University Law Review. He graduated from the University of North Carolina School of the Arts, where he received his bachelor’s degree in dance.