Insight

Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco

The decision “may make it impossible to bring certain mass actions at all.”

Bristol-Myers Squibb Co. Mass Tort

Clifford J. Zatz and Josh Thomas Foust

July 5, 2017 11:06 AM

On June 19, the U.S. Supreme Court dealt a blow to mass tort suits against out-of-state defendants, clarifying again the constitutional limits on specific jurisdiction over foreign corporations. In Bristol-Myers Squibb Co. v. Superior Court of California, the Court held eight to one that California state courts had no jurisdiction to hear claims of non-California residents against Bristol-Myers Squibb Co. (BMS), a Delaware corporation headquartered in New York. In so ruling, the Court confirmed that states may not expand the scope of specific jurisdiction to circumvent the limits on general jurisdiction announced in the Court’s seminal 2014 decision in Daimler AG v. Bauman.

The case arose out of eight complaints filed in California state court by more than 600 plaintiffs where only 86 were California residents. The claims all centered on BMS’s blood-thinning drug Plavix, which it sold and marketed nationwide.

But BMS did not develop Plavix in California, create its marketing strategy there, or manufacture and label Plavix there. And the 592 plaintiffs from 33 other states did not allege that they bought, or were injured by, Plavix in California. The non-resident plaintiffs’ claims, in short, had no connection to California beyond their similarity to the claims of the California-resident plaintiffs.

The California Supreme Court held this slim connection enough for specific jurisdiction. Applying a so-called “sliding scale approach,” the four to three majority found jurisdiction based on BMS’ “extensive contacts with California”—namely, its sales of 187 million Plavix pills to California consumers. The majority stressed the fact that “[b]oth the resident and nonresident plaintiffs’ claims” were based on the “misleading marketing and promotion” of “the same allegedly defective product.” This “common nationwide course of distribution,” it explained, satisfied the specific-jurisdiction requirement that the claims have a “substantial nexus” with the defendant’s California contacts. Three justices dissented, cautioning that the majority’s “sliding scale” approach risked “expand[ing] specific jurisdiction to the point that … it becomes indistinguishable from general jurisdiction”—contravening important constitutional limits.

Siding with the dissenters, the U.S. Supreme Court held that the California court had erred in finding specific jurisdiction over non-resident plaintiffs’ claims based on Plavix sales to resident plaintiffs. Justice Samuel Alito explained that “[w]hat is needed—and what is missing here—is a connection between [California] and the specific claims at issue”—that is, those of the non-residents who did not buy Plavix or suffer injury in California. The fact that the 86 California plaintiffs also bought Plavix did nothing to create specific jurisdiction over their claims. Neither did BMS’ other “unconnected activities” in California. In so reasoning, Justice Alito emphasized that the Due Process Clause did not concern itself only with the burden of hauling a defendant into a distant forum, but also with principles of federalism: even where the forum state has an interest in the litigation and is convenient for the defendant, due process may require divesting the state of its power to render a judgment.

Although the outcome is not surprising, Bristol Myers Squibb is nonetheless a cogent defense of the important distinction between specific and general jurisdiction, as expounded in Daimler AG v. Bauman, 134 S.Ct. 746 (2014). In Daimler, the U.S. Supreme Court rejected the argument that a corporation is subject to general jurisdiction in any forum where its sales are “sizable” or where it otherwise “engages in a substantial, continuous, and systematic course of business.” To the contrary, “only a limited set of affiliations with a forum” will create “all-purpose jurisdiction” there: for most corporations, only the place of incorporation or principal place of business.

The California Supreme Court’s “sliding scale,” in contrast, suggested that a foreign corporation’s sales into the forum state could alone create specific jurisdiction if part of a “common nationwide course.” This decision thus restores clarity by instructing that such contacts do not create specific jurisdiction where (1) the plaintiffs did not buy the products or suffer injury in the forum state, and (2) the conduct giving rise to their claims did not occur there.

Justice Sotomayor, in dissent, expressed concern that the decision “may make it impossible to bring certain mass actions at all.” But a more likely trend would seem to be a shift to states in which plaintiffs can easily assert general jurisdiction and fewer nationwide class actions in plaintiff-friendly courts.

-------------------------

Clifford J. Zatz, a partner at Crowell & Moring, is a trial lawyer in the firm's mass tort, product, and consumer litigation group. He has litigated product liability, toxic tort, environmental, wrongful death, breach of contract, intellectual property, and cases of emerging risks such as online defamation and cyber security. He has been named to The Best Lawyers in America© in Mass Tort Litigation/Class Actions Defendants annually since 2008.

Josh Thomas Foust, a counsel at Crowell & Moring, is a member of the firm’s litigation and mass tort, product, and consumer litigation groups. His practice is focused on class action defense, consumer fraud and false advertising actions, complex commercial litigation, and financial services and securities litigation.

Related Articles

Will the Bristol-Myers Decision of Personal Jurisdiction Further Consolidate Litigation in MDLs?


by Jeffrey Travers and Michael J. Miller

We were able to obtain a verdict for Mr. Cooper within a year of opting for the state courts.

Bristol-Myers MDLs

Divide and Conquer: Plaintiffs Need a Single Forum that Accommodates the Realities of Contemporary Economic Activity


by David A. Mazie and David M. Estes

The growth of mass tort litigation tracks with industries’ shift to mass marketing and distribution of pharmaceutical and consumer products on a national scale.

Contemporary Economic Activity

The Parade of Horribles


by Amy Gunn

Lawsuits about a blood-thinning drug that prevents platelets from clumping together now prevents plaintiffs from joining together to bring state law claims against a corporation when not every plaintiff was harmed in that state.

Bristol-Myers Squibb v Superior Court of CA

Supreme Court further Restricts Where Plaintiffs Can Sue in Mass Torts


by Gregory Bubalo and Katherine A. Dunnington

Bristol-Myers Squibb Co. v. Superior Court of California will significantly impact the plaintiffs’ choices of forums for the filing of mass torts actions.

Plaintiffs No Longer Sue in Mass Torts

Supreme Court Slams Door on Out-of-State Plaintiffs’ Suits


by Dona Szak

In Bristol-Myers Squibb Co. v. Superior Court of California, multiple plaintiffs sued Bristol-Myers Squibb Co. (BMS) in a California state court to recover damages allegedly caused by their use of BMS’ anti-clotting drug, Plavix.

Out-of-State Plaintiffs' Suits

Destiny Fulfilled


by Sara Collin

Was Angela Reddock-Wright destined to become a lawyer? It sure seems that way. Yet her path was circuitous. This accomplished employment attorney, turned mediator, arbitrator and ADR specialist nonpareil discusses her career, the role of attorneys in society, the new world of post-pandemic work and why new Supreme Court Justice Ketanji Brown Jackson represents the future.

Interview with Lawyer Angela Reddock-Wright

Ketanji Brown Jackson Becomes Joe Biden’s Nominee for Vacant SCOTUS Seat


by Gregory Sirico

President Joe Biden has nominated former lawyer Ketanji Brown Jackson for the Supreme Court of the United States.

Biden Nominates Ketanji Brown Jackson

Biden’s History-Making SCOTUS Nominees


by Gregory Sirico

The promise of the first Black female Supreme Court Justice in history is on the verge of reality as the top three candidates for the most recent vacant seat are announced.

Biden Promises First Black Female SCOTUS Pick

Don’t Fall Asleep at the Wheel


by Paul Goatley

Identify Exhaustion or Risk Waiving a Defense.

Don’t Fall Asleep at the Wheel

What New York's Child Victims Act Means for Public Schools


by Anastasia M. McCarthy

The new Child Victims Act is expected to have a profound and long-lasting impact on public school systems.

Understanding New York's Child Victims Act

Supreme Court Decision Will Play Important Role in Shaping Defendant Privacy Rights


by Gus Kostopoulos

The primary question will likely come down to whether or not cell phone data and location records are protected interests under the Fourth Amendment.

Defendant Privacy Rights

Send, Serve, or Both


by Holly M. Polglase and Matthew E. Bown

The Supreme Court decides the meaning of Article 10(A) of the Hague Service Convention.

Article 10(A) of the Hague Service Convention

Victory for The Slants and Redskins


by Carol Steinour Young and Emily Hart

On June 19, 2017, the United States Supreme Court settled the issue of whether an offensive name—in this case, an Asian-American rock band called “The Slants”—can properly be registered as a trademark.

The Slants Legal Case Decoded

Obtaining Cell Phone Records in Civil Litigation


by Jeff S. Korek

You might think that cell phone records could help put a distracted driver behind bars. But getting them isn't so simple.

Are Cell Phone Records Used in Court?

Post-Conviction Relief


by Douglas Trant

In these post-conviction cases, we look for Constitutional violations that deprived the defendant of a fair trial and undermined confidence in the outcome.

Post-Conviction Relief

In the News: Austin/San Antonio


by Compiled by Tess Congo

A summary of newsworthy content from Austin/San Antonio lawyers and law firms.

Austin/San Antonio In the News

Trending Articles

Announcing the 2023 The Best Lawyers in America Honorees


by Best Lawyers

Only the top 5.3% of all practicing lawyers in the U.S. were selected by their peers for inclusion in the 29th edition of The Best Lawyers in America®.

Gold strings and dots connecting to form US map

Announcing the 2022 Best Lawyers® in the United States


by Best Lawyers

The results include an elite field of top lawyers listed in the 28th Edition of The Best Lawyers in America® and in the 2nd Edition of Best Lawyers: Ones to Watch in America for 2022.

2022 Best Lawyers Listings for United States

2021 Best Lawyers: The Global Issue


by Best Lawyers

The 2021 Global Issue features top legal talent from the most recent editions of Best Lawyers and Best Lawyers: Ones to Watch worldwide.

2021 Best Lawyers: The Global Issue

The U.S. Best Lawyers Voting Season Is Open


by Best Lawyers

The voting season for the 31st edition of The Best Lawyers in America® and the 5th edition of Best Lawyers: Ones to Watch® in America is officially underway, and we are offering some helpful advice to this year’s voters.

Golden figures of people standing on blue surface connected by white lines

How To Find A Pro Bono Lawyer


by Best Lawyers

Best Lawyers dives into the vital role pro bono lawyers play in ensuring access to justice for all and the transformative impact they have on communities.

Hands joined around a table with phone, paper, pen and glasses

The Best Lawyers in Australia™ 2024 Launch


by Best Lawyers

Best Lawyers is excited to announce The Best Lawyers in Australia™ for 2023, including the top lawyers and law firms from Australia.

Australian Parliament beside water at sunset

How Palworld Is Testing the Limits of Nintendo’s Legal Power


by Gregory Sirico

Many are calling the new game Palworld “Pokémon GO with guns,” noting the games striking similarities. Experts speculate how Nintendo could take legal action.

Animated figures with guns stand on top of creatures

What the Courts Say About Recording in the Classroom


by Christina Henagen Peer and Peter Zawadski

Students and parents are increasingly asking to use audio devices to record what's being said in the classroom. But is it legal? A recent ruling offer gives the answer to a question confusing parents and administrators alike.

Is It Legal for Students to Record Teachers?

Inflation Escalation


by Ashley S. Wagner

Inflation and rising costs are at the forefront of everyone’s mind as we enter 2023. The current volatile market makes it more important than ever to understand the rent escalation clauses in current and future commercial lease agreements.

Suited figure in front of rising market and inflated balloon

The Upcycle Conundrum


by Karen Kreider Gaunt

Laudable or litigious? What you need to know about potential copyright and trademark infringement when repurposing products.

Repurposed Products and Copyright Infringemen

8 Different Types of Criminal Defenses in Law


by Best Lawyers

Learn about the different types of criminal defenses available in law, including innocence, self-defense, insanity and more. Protect your rights today.

Silver handcuffs laying on finger printed papers

A Celebration of Excellence: The Best Lawyers in Canada 2024 Awards


by Best Lawyers

As we embark on the 18th edition of The Best Lawyers in Canada™, we are excited to highlight excellence and top legal talent across the country.

Abstract image of red and white Canada flag in triangles

Best Lawyers: Ones to Watch in America for 2023


by Best Lawyers

The third edition of Best Lawyers: Ones to Watch in America™ highlights the legal talent of lawyers who have been in practice less than 10 years.

Three arrows made of lines and dots on blue background

Wage and Overtime Laws for Truck Drivers


by Greg Mansell

For truck drivers nationwide, underpayment and overtime violations are just the beginning of a long list of problems. Below we explore the wages you are entitled to but may not be receiving.

Truck Driver Wage and Overtime Laws in the US

Choosing a Title Company: What a Seller Should Expect


by Roy D. Oppenheim

When it comes to choosing a title company, how much power exactly does a seller have?

Choosing the Title Company As Seller

The 2024 Best Lawyers in Spain™


by Best Lawyers

Best Lawyers is honored to announce the 16th edition of The Best Lawyers in Spain™ and the third edition of Best Lawyers: Ones to Watch in Spain™ for 2024.

Tall buildings and rushing traffic against clouds and sun in sky