Supreme Court Derails Forum Shoppers

By Lawrence S. EbnerJune 1, 2017

The Supreme Court’s May 30 opinion in BNSF Railway Co. v. Tyrrell reaffirms that a State’s court system cannot exercise “general” or “all-purpose” personal jurisdiction over a corporation unless the company is incorporated in that State, has its principal place of business in that State, or otherwise is “at home” in that State.  See Daimler AG v. Bauman, 134 S. Ct. 746 (2014).  This is a blow to forum-shopping lawyers who seek to exact enormous settlements from, or judgments against, companies that sell products or provide services throughout the nation.  According to the Court’s opinion, written by Justice Ginsburg, BNSF has over 2,000 miles of railroad track and more than 2,000 employees in Montana. But that was not enough of a Due Process connection to allow Montana state courts to exercise “general personal jurisdiction” over the railroad in liability suits brought by out-of-state employees who were not injured in Montana.  In a separate opinion, Justice Sotomayor asserted that the majority’s approach “grants a jurisdictional windfall to large multistate or multinational corporations.”  To the contrary, the Court’s approach preserves some semblance of fairness in the civil justice system.