Insight

Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco

The decision “may make it impossible to bring certain mass actions at all.”

Bristol-Myers Squibb Co. Mass Tort
CF

Clifford J. Zatz and Josh Thomas Foust

July 5, 2017 11:06 AM

On June 19, the U.S. Supreme Court dealt a blow to mass tort suits against out-of-state defendants, clarifying again the constitutional limits on specific jurisdiction over foreign corporations. In Bristol-Myers Squibb Co. v. Superior Court of California, the Court held eight to one that California state courts had no jurisdiction to hear claims of non-California residents against Bristol-Myers Squibb Co. (BMS), a Delaware corporation headquartered in New York. In so ruling, the Court confirmed that states may not expand the scope of specific jurisdiction to circumvent the limits on general jurisdiction announced in the Court’s seminal 2014 decision in Daimler AG v. Bauman.

The case arose out of eight complaints filed in California state court by more than 600 plaintiffs where only 86 were California residents. The claims all centered on BMS’s blood-thinning drug Plavix, which it sold and marketed nationwide.

But BMS did not develop Plavix in California, create its marketing strategy there, or manufacture and label Plavix there. And the 592 plaintiffs from 33 other states did not allege that they bought, or were injured by, Plavix in California. The non-resident plaintiffs’ claims, in short, had no connection to California beyond their similarity to the claims of the California-resident plaintiffs.

The California Supreme Court held this slim connection enough for specific jurisdiction. Applying a so-called “sliding scale approach,” the four to three majority found jurisdiction based on BMS’ “extensive contacts with California”—namely, its sales of 187 million Plavix pills to California consumers. The majority stressed the fact that “[b]oth the resident and nonresident plaintiffs’ claims” were based on the “misleading marketing and promotion” of “the same allegedly defective product.” This “common nationwide course of distribution,” it explained, satisfied the specific-jurisdiction requirement that the claims have a “substantial nexus” with the defendant’s California contacts. Three justices dissented, cautioning that the majority’s “sliding scale” approach risked “expand[ing] specific jurisdiction to the point that … it becomes indistinguishable from general jurisdiction”—contravening important constitutional limits.

Siding with the dissenters, the U.S. Supreme Court held that the California court had erred in finding specific jurisdiction over non-resident plaintiffs’ claims based on Plavix sales to resident plaintiffs. Justice Samuel Alito explained that “[w]hat is needed—and what is missing here—is a connection between [California] and the specific claims at issue”—that is, those of the non-residents who did not buy Plavix or suffer injury in California. The fact that the 86 California plaintiffs also bought Plavix did nothing to create specific jurisdiction over their claims. Neither did BMS’ other “unconnected activities” in California. In so reasoning, Justice Alito emphasized that the Due Process Clause did not concern itself only with the burden of hauling a defendant into a distant forum, but also with principles of federalism: even where the forum state has an interest in the litigation and is convenient for the defendant, due process may require divesting the state of its power to render a judgment.

Although the outcome is not surprising, Bristol Myers Squibb is nonetheless a cogent defense of the important distinction between specific and general jurisdiction, as expounded in Daimler AG v. Bauman, 134 S.Ct. 746 (2014). In Daimler, the U.S. Supreme Court rejected the argument that a corporation is subject to general jurisdiction in any forum where its sales are “sizable” or where it otherwise “engages in a substantial, continuous, and systematic course of business.” To the contrary, “only a limited set of affiliations with a forum” will create “all-purpose jurisdiction” there: for most corporations, only the place of incorporation or principal place of business.

The California Supreme Court’s “sliding scale,” in contrast, suggested that a foreign corporation’s sales into the forum state could alone create specific jurisdiction if part of a “common nationwide course.” This decision thus restores clarity by instructing that such contacts do not create specific jurisdiction where (1) the plaintiffs did not buy the products or suffer injury in the forum state, and (2) the conduct giving rise to their claims did not occur there.

Justice Sotomayor, in dissent, expressed concern that the decision “may make it impossible to bring certain mass actions at all.” But a more likely trend would seem to be a shift to states in which plaintiffs can easily assert general jurisdiction and fewer nationwide class actions in plaintiff-friendly courts.

-------------------------

Clifford J. Zatz, a partner at Crowell & Moring, is a trial lawyer in the firm's mass tort, product, and consumer litigation group. He has litigated product liability, toxic tort, environmental, wrongful death, breach of contract, intellectual property, and cases of emerging risks such as online defamation and cyber security. He has been named to The Best Lawyers in America© in Mass Tort Litigation/Class Actions Defendants annually since 2008.

Josh Thomas Foust, a counsel at Crowell & Moring, is a member of the firm’s litigation and mass tort, product, and consumer litigation groups. His practice is focused on class action defense, consumer fraud and false advertising actions, complex commercial litigation, and financial services and securities litigation.

Related Articles

Will the Bristol-Myers Decision of Personal Jurisdiction Further Consolidate Litigation in MDLs?


by Jeffrey Travers and Michael J. Miller

We were able to obtain a verdict for Mr. Cooper within a year of opting for the state courts.

Bristol-Myers MDLs

Divide and Conquer: Plaintiffs Need a Single Forum that Accommodates the Realities of Contemporary Economic Activity


by David A. Mazie and David M. Estes

The growth of mass tort litigation tracks with industries’ shift to mass marketing and distribution of pharmaceutical and consumer products on a national scale.

Contemporary Economic Activity

The Parade of Horribles


by Amy Gunn

Lawsuits about a blood-thinning drug that prevents platelets from clumping together now prevents plaintiffs from joining together to bring state law claims against a corporation when not every plaintiff was harmed in that state.

Bristol-Myers Squibb v Superior Court of CA

Supreme Court further Restricts Where Plaintiffs Can Sue in Mass Torts


by Gregory Bubalo and Katherine A. Dunnington

Bristol-Myers Squibb Co. v. Superior Court of California will significantly impact the plaintiffs’ choices of forums for the filing of mass torts actions.

Plaintiffs No Longer Sue in Mass Torts

Destiny Fulfilled


by Sara Collin

Was Angela Reddock-Wright destined to become a lawyer? It sure seems that way. Yet her path was circuitous. This accomplished employment attorney, turned mediator, arbitrator and ADR specialist nonpareil discusses her career, the role of attorneys in society, the new world of post-pandemic work and why new Supreme Court Justice Ketanji Brown Jackson represents the future.

Interview with Lawyer Angela Reddock-Wright

Ketanji Brown Jackson Becomes Joe Biden’s Nominee for Vacant SCOTUS Seat


by Gregory Sirico

President Joe Biden has nominated former lawyer Ketanji Brown Jackson for the Supreme Court of the United States.

Biden Nominates Ketanji Brown Jackson

Biden’s History-Making SCOTUS Nominees


by Gregory Sirico

The promise of the first Black female Supreme Court Justice in history is on the verge of reality as the top three candidates for the most recent vacant seat are announced.

Biden Promises First Black Female SCOTUS Pick

Don’t Fall Asleep at the Wheel


by Paul Goatley

Identify Exhaustion or Risk Waiving a Defense.

Don’t Fall Asleep at the Wheel

What New York's Child Victims Act Means for Public Schools


by Anastasia M. McCarthy

The new Child Victims Act is expected to have a profound and long-lasting impact on public school systems.

Understanding New York's Child Victims Act

Supreme Court Decision Will Play Important Role in Shaping Defendant Privacy Rights


by Gus Kostopoulos

The primary question will likely come down to whether or not cell phone data and location records are protected interests under the Fourth Amendment.

Defendant Privacy Rights

Send, Serve, or Both


by Holly M. Polglase and Matthew E. Bown

The Supreme Court decides the meaning of Article 10(A) of the Hague Service Convention.

Article 10(A) of the Hague Service Convention

Victory for The Slants and Redskins


by Carol Steinour Young and Emily Hart

On June 19, 2017, the United States Supreme Court settled the issue of whether an offensive name—in this case, an Asian-American rock band called “The Slants”—can properly be registered as a trademark.

The Slants Legal Case Decoded

Post-Conviction Relief


by Douglas Trant

In these post-conviction cases, we look for Constitutional violations that deprived the defendant of a fair trial and undermined confidence in the outcome.

Post-Conviction Relief

In the News: Austin/San Antonio


by Compiled by Tess Congo

A summary of newsworthy content from Austin/San Antonio lawyers and law firms.

Austin/San Antonio In the News

Trending Articles

The Real Camille: An Interview with Johnny Depp’s Lawyer Camille Vasquez


by Rebecca Blackwell

Camille Vasquez, a young lawyer at Brown Rudnick, sat down with Best Lawyers CEO Phillip Greer to talk about her distinguished career, recently being named partner and what comes next for her.

Camille Vasquez in office

Announcing the 2022 Best Lawyers® in the United States


by Best Lawyers

The results include an elite field of top lawyers listed in the 28th Edition of The Best Lawyers in America® and in the 2nd Edition of Best Lawyers: Ones to Watch in America for 2022.

2022 Best Lawyers Listings for United States

Famous Songs Unprotected by Copyright Could Mean Royalties for Some


by Michael B. Fein

A guide to navigating copyright claims on famous songs.

Can I Sing "Happy Birthday" in Public?

Best Lawyers: Ones to Watch – The Future of Legal Talent Looks Bright


by Justin Smulison

Best Lawyers: Ones to Watch is launching its second edition in the United States, and after talking with both a company leader and esteemed lawyers on the list, the importance of this prestigious list is evident.

Best Lawyers: Ones to Watch in America 2022

Johnny Depp and Amber Heard: The Best Lawyers Honorees Behind the Litigation


by Gregory Sirico

Best Lawyers takes a look at the recognized legal talent representing Johnny Depp and Amber Heard in their ongoing defamation trial.

Lawyers for Johnny Depp and Amber Heard

Why Cariola Díez Pérez-Cotapos Developed Its Own Legal Tech


by Best Lawyers

Juan Pablo Matus of Cariola Díez Pérez-Cotapos, 2019 "Law Firm of the Year" award for Corporate and M&A Law in Chile, discusses his firm's joint venture with Cognitiva in creating Lexnova, a legal AI system.

Cariola Díez Pérez-Cotapos Interview

Choosing a Title Company: What a Seller Should Expect


by Roy D. Oppenheim

When it comes to choosing a title company, how much power exactly does a seller have?

Choosing the Title Company As Seller

Announcing the 2022 "Best Law Firms" Rankings


by Best Lawyers

The 2022 “Best Law Firms” publication includes all “Law Firm of the Year” recipients, national and metro Tier 1 ranked firms and editorial from thought leaders in the legal industry.

The 2022 Best Law Firms Awards

Announcing the 2022 Best Lawyers in Canada™


by Best Lawyers

The results include an elite field of top lawyers listed in the 16th Edition of The Best Lawyers in Canada™ and 1st Edition of Best Lawyers: Ones to Watch in Canada.

Announcing the 2022 Best Lawyers in Canada™

Education by Trial: Cultivating Legal Expertise in the Courtroom


by Margo Pierce

The intricacies of complex lawsuits require extensive knowledge of the legal precedent. But they also demand a high level of skill in every discipline needed to succeed at trial, such as analyzing technical reports and deposing expert witnesses.

Cultivating Legal Expertise in the Courtroom

Announcing The Best Lawyers in France™ 2023


by Best Lawyers

The results include an elite field of top lawyers and firms from France.

Blue, white and red strips

Wage and Overtime Laws for Truck Drivers


by Greg Mansell

For truck drivers nationwide, underpayment and overtime violations are just the beginning of a long list of problems. Below we explore the wages you are entitled to but may not be receiving.

Truck Driver Wage and Overtime Laws in the US

Caffeine Overload and DUI Tests


by Daniel Taylor

While it might come as a surprise, the over-consumption of caffeine could trigger a false positive on a breathalyzer test.

Can Caffeine Cause You to Fail DUI Test?

Announcing the 2022 Best Lawyers™ in Australia


by Best Lawyers

The results include an elite field of top lawyers and firms.

Announcing the 2022 Best Lawyers™ in Australi

Announcing The Best Lawyers in The United Kingdom™ 2023


by Best Lawyers

The results include an elite field of top lawyers and firms from the United Kingdom.

The Best Lawyers in The United Kingdom 2023

Georgia Laws Taking Effect in 2022


by Gregory Sirico

Three new pieces of Georgia legislation aim to improve medical bill transparency, lower the sales tax on vehicles and enact further safeguards to protect children in foster care.

New Georgia Laws Enacted in 2022