Source: https://classifiedclassaction.com/district-courts-split-on-whether-bristol-myers-squibbs-specific-personal-jurisdiction-analysis-bars-nationwide-class-actions-in-districts-beyond-defendants-home-venue/
Timestamp: 2019-04-18 20:57:54+00:00

Document:
The ramifications of the Supreme Court’s decision in Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco Cty., 137 S. Ct. 1773 (2017), remain unsettled. In Bristol-Myers Squibb, the United States Supreme Court rejected California’s “sliding scale approach” to assertions of specific personal jurisdiction. California’s Supreme Court had addressed a nationwide mass action and held that California could assert specific jurisdiction over the claims of non-California plaintiffs who were allegedly injured by a pharmaceutical drug outside of California because those claims were of the same variety as those asserted by California residents.
However, the United States Supreme Court rejected that analysis as reflecting “a loose and spurious form of general jurisdiction,” which violated the non-resident defendants’ due process rights under the Fourteenth Amendment. Since Bristol-Myers Squibb was decided, a split developed in district courts regarding the increasingly important question of whether this holding applies to Rule 23 class actions. See, e.g., DeBernardis v. NBTY, Inc., No. No. 1:17-cv-06125, 2018 WL 461228, at *1-2 (N.D. Ill. Jan. 18, 2018) (describing split among district courts on this issue and holding that “it is more likely than not[,] based on the Supreme Court’s comments about federalism[,] that the courts will apply Bristol-Myers Squibb to outlaw nationwide class actions in a forum, such as in this case, where there is no general jurisdiction over the Defendants”).
In Practice Management Support Services Inc. v. Cirque du Soleil Inc., 301 F. Supp. 3d 840 (N.D. Ill. 2018), Judge Thomas M. Durkin of the Northern District of Illinois agreed with the courts holding that Bristol-Myers Squibb applies to class actions. The court reached this conclusion because, under the Rules Enabling Act, the constitutional right to due process (on which the personal jurisdiction analysis is predicated) applies equally to class actions.
Indeed, the United States Supreme Court has emphasized that “Rule 23’s requirements must be interpreted in keeping with Article III constraints, and with the Rules Enabling Act, which instructs that the [federal] rules of procedure ‘shall not abridge, enlarge, or modify any substantive right.’” Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 592 (1997) (quoting 28 U.S.C. § 2072(b)). Because Practice Management involved an asserted class under the Telephone Consumer Protection Act — which does not provide for nationwide service of process — the court provided its analysis under the typical Fourteenth Amendment personal jurisdiction framework that also applies to diversity cases.
In Practice Management, Judge Durkin also rejected the position that Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985), resolved the personal-jurisdiction question at issue. Specifically, Practice Management agreed with the Bristol-Myers Squibb majority that Shutts addressed the different question of whether the class at issue there violated the due process rights of the out-of-state class members — not the due process rights of non-resident defendants (Practice Management involved Canadian and Delaware/Nevada entities being sued in an Illinois federal court). The personal jurisdiction argument centering on the due process rights of non-resident defendants simply was not raised in Shutts.
Ultimately, because Judge Durkin found that his court lacked specific jurisdiction over the claims of the prospective class members who did not reside in Illinois, he denied class certification regarding the out-of-state, prospective class members (but granted it as to the Illinois class members).
A week later and 2,000 miles away, Judge John A. Houston of the Southern District of California reached a different result in In re Song Bird Food Litigation, No. No. 3:12-cv-01592-JAH-AGS, 2018 WL 1382746, at *5 (S.D. Cal. Mar. 19, 2018). This case involved an already certified nationwide class about bird food. Following class certification, and issuance of Bristol-Myers Squibb, the defendants sought to limit the class to a California-only class. They argued that Bristol-Myers Squibb dictated this outcome, and their arguments tracked those which Judge Durkin accepted in Practice Management.
Judge Houston, however, found Bristol-Myers “inapplicable.” “Bristol-Myers involved a state court’s exercise of personal jurisdiction over a non-resident defendant” as to the mass tort claims of non-resident named plaintiffs. “The Court in Bristol-Myers, specifically limited its ruling to the exercise of jurisdiction by a state court and left open the question of whether ‘the Fifth Amendment imposes the same restrictions on the exercise of personal jurisdiction by a federal court.’” Judge Houston found “Bristol-Myers inapplicable to this suit which involves a class action. Bristol-Myers was a mass tort action and it determined the court’s exercise of jurisdiction to hear claims by named non-resident plaintiffs. While the claims of the non-resident named plaintiffs were pertinent to the issue of specific jurisdiction in Bristol-Myers, ‘claims of unnamed class members are irrelevant to the question of specific jurisdiction.’” He noted that in Bristol-Myers Squibb, the majority left open the question of the decision’s applicability to class actions. 137 S. Ct. at 1789 n.4 (“The Court today does not confront the question whether its opinion here would also apply to a class action in which a plaintiff injured in the forum State seeks to represent a nationwide class of plaintiffs, not all of whom were injured there.”).
Aaron Weiss is a shareholder at Carlton Fields in Miami, Florida. Connect with Aaron on LinkedIn.

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