Strategically Leveraging the Personal Jurisdiction Requirement to Put the Brakes on Litigation Tourism & Forum Shopping

OACTA Quarterly Review

I. Why It Matters

Until recently, personal jurisdiction over corporate defendants had been expanding significantly in scope through the reliance on tenuous corporate contacts or business conducted by a defendant in a particular forum. In January 2014, however, that all started to change when the United States Supreme Court issued its decision in Daimler AG v. Bauman, 564 U.S. 915 (2014), holding that corporations are subject to general jurisdiction in just two states – the company’s state of incorporation, and state in which the company maintains its principal place of business. Three years later, the Supreme Court reaffirmed its ruling in Daimler in BNSF Railway Co. v. Tyrrell, 137 S.Ct. 1549 (2017), in which the Court erased any doubt regarding the contours of general jurisdiction by holding that absent any truly rare circumstances, general jurisdiction may be found only in a company’s state of incorporation or where it has its principal place of business. Finally, also in 2017 the Supreme Court decided Bristol-Myers Squibb v. Superior Court of California, 137 S.Ct. 1773 (2017), in which the Court articulated a clear rule limiting specific jurisdiction to those cases where the injury at issue arises out of the defendant’s specific conduct occurring within the borders of the chosen forum, thereby eliminating the ability to establish personal jurisdiction merely through a defendant’s general connections with the forum. Combined, these three decisions are critical for corporate defendants who find themselves embroiled in toxic tort, asbestos, and product liability litigation, as these cases have significantly limited where plaintiffs can bring claims and, in turn, have substantially curtailed the practice of litigation tourism and forum shopping as a result of the limitations that have been placed on a forum state’s exercise of personal jurisdiction.

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"Strategically Leveraging the Personal Jurisdiction Requirement to Put the Brakes on Litigation Tourism & Forum Shopping," by David J. Oberly and Kevin M. Bandy was published in the Winter 2019 edition of OACTA Quarterly Review. Reprinted with permission.