JV-GJ

Daimler Trucks North America LLC v. Superior Court, No. B316199 (D2d5 Jul. 7, 2022)

This is basically the state court equivalent of the U.S. Supreme Court’s recent personal jurisdiction decision in Ford Motor Company v. Montana Eighth Judicial District Court, 141 S.Ct. 1017, 1024–1025 (2021). Plaintiff, a Californian, is a truck driver. His truck is made by Daimler. He bought it used, in California. But it was originally sold in Georgia. Plaintiff got into a bad accident in Oklahoma while on a long-haul trip back to California. He sued Daimler, in California, alleging that the truck had a design defect. Daimler moved to quash for lack of personal jurisdiction. The trial court denied the motion, and Daimler took a writ.

Daimler makes two basic points: (1) it didn’t design, manufacture, assemble, or sell the truck in California; and (2) the accident was in Oklahoma.  

The first point is clearly foreclosed by Ford. There, plaintiffs, who bought used Ford vehicles in their home states sued Ford in home state courts after vehicular accidents in those states. Ford argued that those facts didn’t satisfy the second element of the traditional three-step specific personal jurisdiction analysis—that the claim arise out of or relate to the defendant’s in-state contacts—because the plaintiff’s injuries weren’t caused by anything Ford did in their home states. The Court rejected that analysis, finding that Plaintiff’s claims related to Ford’s extensive marketing and sales of its vehicles in the home states, even if those particular vehicles were sold elsewhere. 

But the second point is different. The Ford plaintiffs sued where the accidents happened, which also happened to be their home states. Here, however, the accident happened in Oklahoma, albeit to a Californian. While Ford suggested that an in-state injury could be relevant to the jurisdictional inquiry, it was not an irreducible minimum to find jurisdiction. The Court here finds that it because Plaintiff is Californian, the out-of-state nature of the accident isn’t dispositive. When a Californian is injured by a product that a defendant extensively markets and sells to Californians, that is enough to satisfy the relatedness test, even if the injury occurs elsewhere.

In coming to this conclusion, the court contrasts Bristol-Myers Squibb Co. v. Superior Court, 137 S.Ct. 1773 (2017), where the court found that a defendant’s extensive marketing and sales of drugs in California did not satisfy relatedness when the plaintiffs were out-of-state citizens who were allegedly injured by pharmaceuticals taken in their home states.

Writ denied.

It seems like we’re effectively seeing a third category of personal jurisdiction emerge. Eight years ago, in another case involving Daimler—Daimler AG v. Bauman, 134 S.Ct. 746 (2014)—the Supreme Court did away with the old “systematic and continuous” test for general jurisdiction, replacing it with a test finding general jurisdiction only where the defendant is “at home.” For a corporation, that’s its headquarters and place of incorporation. So just doing a lot of business in a state is not enough, without more, to make a company subject to jurisdiction there. And Bristol-Myers Squibb declined to blow a hole in that rule by finding, at least for out of state plaintiffs, that lots and lots of in-state business was enough to justify a “sliding-scale” rule where a flimsy standard for relatedness would suffice.

But limiting general jurisdiction causes some problems. Because, under a more stringent test for relatedness in specific-jurisdiction, it means that arbitrary factual distinctions (like the fact that an allegedly defective truck was bought used, in California, from someone who originally bought it in Georgia) could lead to plaintiffs being unable to sue in the courts of their home states, even when the defendant moves lots of the same product in the plaintiff’s home state.

So there is this class of cases where there are (1) home-state plaintiffs; (2) defendants who would have satisfied the pre-Daimler “systematic and continuous” test; and (3) where the instrumentality that hurt the plaintiff is marketed and sold to others in the jurisdiction where the defendant lives. In these cases, we are getting to a kind of junior-varsity general jurisdiction, where “relatedness” requires only that the three elements exist. 

And maybe that’s fine. Jurisdiction feels fair in Ford and here. If companies elect to extensively avail themselves of a state’s markets, state courts should get to vindicate their citizens’ injuries connected with those products, even if the relatedness line is only conceptual, not causal. On the other hand, the plaintiffs in Bristol-Myers—non-Californians suing for injuries allegedly due to taking Plavix outside of California—were pretty obviously engaged in forum shopping, so holding them to a higher relatedness standard makes sense. I'm just not sure this is a rule.

Relatedness Is Not Liability

Bader v. Avon Prods., Inc., No. A157401 (D1d4 Sept. 29, 2020)

Plaintiff in this case is a lifelong Californian who claims she got mesothelioma from a lifetime of using Avon products containing talc that was allegedly contaminated by asbestos. Avon objected to personal jurisdiction, claiming that Plaintiff had not satisfied the “relatedness” prong of the specific jurisdiction inquiry, which asks whether the plaintiff’s claims are substantially connected to the defendant’s in-state contacts. The trial court found that relatedness had not been established and dismissed for lack of personal jurisdiction.

Avon’s relatedness argument here is, charitably, a stretch. Plaintiff says Avon sold her talc products in California and that the talc gave her cancer. That seems like it should be enough relatedness for specific jurisdiction. (Generally, in products liability cases, relatedness arguments come up when plaintiffs engage in forum shopping by suing where they have only tenuous connection, such that their injuries have little to do with the defendant’s in-forum sales. Like when someone from Iowa sues in California based on a product that was purchased in Iowa.) 

Avon, however, says that the Supreme Court’s rejection of California’s “sliding scale” relatedness test in Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773, 1776 (2017) also requires Plaintiff to show that the talc that Avon sold her in California actually contained asbestos in order to establish personal jurisdiction. The Court of Appeal rejects the argument, more kindly than I would. Because it’s basically nonsense. 

Sliding scale relatedness was a short lived effort to concoct a junior varsity version of general jurisdiction after the Supreme Court limited general jurisdiction to states where the defendant is “essentially at home.” See Daimler AG v. Bauman, 134 S. Ct. 746 (2014); Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011). Skirting that rule, a 4-3 majority of the California Supreme Court held that when a defendant has lots and lots of connections in the forum state—sort of akin to the “systematic and continuous” test that applied for general jurisdiction pre-Goodyear and Daimler, see Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984)—the nexus between the defendant’s contacts and the plaintiff’s claims could be pretty tenuous. But the U.S. Supreme Court granted cert from that decision, ultimately finding that the sliding scale test was inconsistent with due process. Bristol-Myers, 137 S. Ct. at 1781–82. Specific jurisdiction thus requires some substantial relationship between the contacts and the claim irrespective of what other non-claim related contacts the defendant might have in the forum, regardless of how significant those contacts are.

So far, all good. 

But what neither Bristol Meyers nor any other court has ever said is that, to show relatedness, the plaintiff has to affirmatively prove, as jurisdictional matter, that the defendant’s in-forum sales actually caused her injury. That would make the test for personal jurisdiction—a question usually resolved at the outset of the case—impossibly high and unduly complicated. So high and complicated that a plaintiff couldn’t hale a defendant into a court in her home state for selling her an allegedly defective product in her home state unless she arrives at the courthouse on day one loaded for bear with expert testimony on causation. That doesn’t make any sense.

Reversed.

Refurber Madness.

Strasner v. Touchstone Wireless Repair & Logistics, LP, No. D068865 (D4d1 Nov. 4, 2016)

Plaintiff—a California native living at the time in NYC—returned a cell phone to a T-Mobile store in New York. In the process of refurbing the phone, an employee of the Refurber found some apparently sensitive pictures of Plaintiff on the phone and posted them to her Facebook wall. Plaintiff sued T-Mobile, four companies related to the refurbing, and those companies’ parent for invasion of privacy and related torts. Refurbers moved to quash service of lack of personal jurisdiction, which the trial court granted.

Railroad Isn't at Home in California

BNSF Railway Co. v. Superior Court, No. B260798 (Mar. 27, 2015)

This is an asbestos case.  Plaintiffs are the heirs of a man who died from meso contracted through asbestos exposure in Wichita, Kansas. One defendant is BNSF, which is a Delaware Corporation with its headquarters in El Paso, Texas. BNSF moved to quash service based on lack of personal jurisdiction. Given the location of the exposure, there’s no specific jurisdiction because nothing connects the plaintiff’s injury to California. As to general jurisdiction, the new Daimler standard says there’s only general jurisdiction where a company is “at home,” which is essentially where is is headquartered. Plaintiff tried to wiggle out of that by arguing the BNSF does a lot of business in California and that Daimler was distinguishable because it involved a truly foreign defendant. The trial court took the bait.

On a writ, the court of appeal doesn’t. The Daimler test doesn’t ask if a company does a bunch of business. It asks if it is “at home.” So the fact that BNSF does big business in California doesn’t much matter. On the latter point, the court gives a good quote on stare decisis: “Factual differences between the case at bar and the four general jurisdiction cases considered by the high court do not render the broad principles enunciated in those cases inapplicable to the situation here.” 

Writ granted.

Update: Review granted, July 23, 2015.

Herr Mercedes Ist Nicht Hier zu Hause

Young v Daimler AG, No. A135995 (D1d4 Aug 5, 2014)

Plaintiffs appeal an order granting a motion to quash service on Daimer AG, because the court lacked general personal jurisdiction over that defendant. Just this past January, the U.S. Supreme Court held that the very same German company was not subject to general personal jurisdiction in California. See Daimler AG v. Bauman, ___ U.S. ___, 134 S.Ct. 746 (2014). So the only thing surprising about the result of this appeal is that the panel granted a request to publish it.

Affirmed.

Sliding Scale or Slippery Slope?

Bristol-Myers Squibb v. Superior Court, No. A140035 (D1d2 July 30, 2014)

The case is a coordinated mass tort proceeding concerning alleged defects in Plavix. Most of the plaintiffs are Californians, but a significant minority are not. Defendant BMS moved to quash service from the out of state plaintiffs, arguing that the court lacked personal jurisdiction to the extent that the claims arose from out-of-state injuries. The trial court denied the motion, finding that BMS was subject to general jurisdiction in California. The court here denies a writ, agreeing that there’s personal jurisdiction, but for different reasons.