Due Process, General Personal Jurisdiction, and F-Cubed Litigation: The Extraterritorial Reach of American State Courts Over Foreign Nation Corporations for Alleged Human Rights Violations

This article discusses the Supreme Court’s consideration in October 2013 of the appeal of DaimlerChrysler arising out of alleged human rights violations committed in Argentina between 1976 and 1983. The case concerns the extra-territorial reach of American courts in litigation brought by foreign plaintiffs for acts committed by foreign defendants in foreign countries. The Court will have to evaluate whether an American state court, consistent with the Due Process Clause of the Fourteenth Amendment, can exert general personal jurisdiction over a foreign corporation for alleged human rights violations in another country, based on the fact that an indirect corporate subsidiary performs services on behalf of the corporation in an American state.The DaimlerChrysler appeal returns the Supreme Court to its evolving body of personal jurisdiction jurisprudence. And, the year after it considered the extra-territorial reach of American courts for foreign violations of human rights in Kiobel, the Court will return to that theme in the personal jurisdiction context. Thus, the DaimlerChrysler case presents the court with another so-called F-cubed litigation: lawsuits where foreign plaintiffs invoke the jurisdiction of American courts to vindicate human rights claims against foreign defendants committed on foreign soil. This appeal does not concern the subject matter of the California court. Although the federal claims under the Alien Tort Statute and the Torture Victim's Protection Act have been extinguished by recent Court rulings, the plaintiffs’ state and Argentine claims remain in the federal court’s supplemental jurisdiction. The large number of amicus briefs filed by corporate entities, foreign business associations, defense counsel, the Department of Justice and others in support of DaimlerChrylser demonstrate the significance of this appeal. In the past two years, in at least four major decisions dealing with subject matter and personal jurisdiction, the Supreme Court has consistently registered its distaste ― if not discomfort ― with extending the territorial reach of American courts to provide the forum for resolution of any and all litigation in the world. While the Court’s jurisdiction jurisprudence has indeed proceeded on a plodding case by case basis, the over-arching policy implications of the extra-territorial reach of American courts is difficult to ignore.On the one hand, the Court may resolve the Daimler appeal on the narrowest basis, reviewing the Ninth’s Circuit’s novel agency test for assertions of general jurisdiction over foreign corporations lacking direct presence in the United States. In so doing, the Court also may consider the Ninth Circuit’s application of the Asahi reasonableness factors. On the other hand, the Court might address the plaintiffs’ recasting of the entire litigation as a question of democratic authority. In this regard, the plaintiffs seem to be suggesting that the Court cannot and should not resolve this case by judicial policymaking through yet another refinement of personal jurisdiction jurisprudence. Instead, they challenge the Court to consider that democratic theory mandates that such jurisdictional rules be accomplished through the democratic processes of Congress or state legislative bodies. This is a very provocative theory and a novel approach to the Court’s entire jurisdictional body of precedents. Were the Court to consider this challenge, this would question if not undermine several decades of careful case-by-case doctrinal development by the Court.