By a unanimous vote of 8-0, the United States Supreme Court has shifted the personal jurisdiction landscape for many product manufacturers, finding some companies may be subject to suit in any U.S. jurisdiction where a product-related injury occurs.
Today’s opinion in Ford Motor Company v. Montana Eighth Judicial District Court, No. 19-368 (Mar. 25, 2021), stems from two consolidated product-liability cases against Ford Motor Company that were originally filed in Montana and Minnesota. The plaintiffs in each case purchased their Ford vehicles outside of their home states, unilaterally brought them into their home states, and were injured while operating their Fords at home. Ford contested personal jurisdiction in both cases — although it did not dispute “that it does substantial business in Montana and Minnesota” by “activel[y] seeking to serve the market for automobiles and related products in those States,” it argued that the plaintiffs’ claims did not “arise out of” that conduct because the two cars at issue were manufactured, distributed, and originally sold outside of Montana and Minnesota.
The state courts rejected this argument, finding Ford amenable to suit because the plaintiffs’ claims were sufficiently “connected” to Ford’s conduct in those states, even though the plaintiffs’ claims were not causally related to Ford’s conduct therein. As Justice Kagan said in delivering the opinion of the Court, that “connection” was “close enough” for specific jurisdiction.
A quick refresher on personal jurisdiction: At its most basic level, the concept arises from the Due Process Clause of the Fourteenth Amendment’s limitations on “a state courts’ power to exercise jurisdiction over a defendant.” The intent of the doctrine is (1) to ensure defendants are treated fairly and (2) to protect “interstate federalism.” With these considerations in mind, a court can exercise personal jurisdiction over a nonresident defendant in two ways: by finding the existence of (1) specific (or “case-linked”) jurisdiction, or (2) general (or “all-purpose”) jurisdiction. The Supreme Court’s 2014 decision in Daimler AG v. Bauman significantly limited general jurisdiction to forums where a corporate defendant is essentially “at home,” i.e. where it is incorporated or where its principal place of business is located, unless “exceptional” circumstances dictate otherwise. Specific jurisdiction, on the other hand, has always had — and, as of today, continues to have — a less clear analytical framework.
Justice Kagan set forth the imprecise two-part test for specific jurisdiction in today’s opinion. First, a defendant “must take ‘some act by which it purposefully avails itself of the privilege of conducting activities within the forum State.’” Stated differently, the defendant must have “deliberately ‘reached out beyond its home’” and into the forum state to do business. Second, the plaintiff’s claims “‘must arise out of or relate to the defendant’s contacts’ with the forum.” It is the “or relate to” language of the second part that the Court focused on in today’s opinion — or so the Court contends.
As noted above, Ford’s argument against personal jurisdiction finds its footing in the “arise out of” language of the second part of the test. According to Ford, due process requires a showing that the defendant’s conduct in the forum state was a “but for” cause of the plaintiff’s claims. In other words, because Ford did not design, manufacture, or sell the subject vehicles in the plaintiffs’ home states, it cannot be sued there. The Supreme Court disagreed: “None of our precedents has suggested that only a strict causal relationship between the defendant’s in-state activity and the litigation will do.”
The Court’s starting place for this point was Worldwide Volkswagen, supra. While the Court said the New York car dealer in that case could not be haled into court in Oklahoma for selling an allegedly defective car to the plaintiff that caught fire in Oklahoma, the car manufacturer (Audi) and the nationwide importer (Volkswagen) were not similarly situated. As it explained, “if Audi and Volkswagen’s business deliberately extended into Oklahoma (among other States), then Oklahoma’s courts could hold the companies accountable for a car’s catching fire there—even though the vehicle had been designed and made overseas and sold in New York.”
The issue with the Court’s reliance on Worldwide Volkswagen, however, is seen in the very next sentence of the Court’s opinion: “For, the Court explained, a company thus ‘purposefully availing itself’ of the Oklahoma auto market ‘has clear notice of its exposure in that State to suits arising from local accidents involving its cars.” The problem with this reasoning is that the Court should be focusing on the “arise out of or relate to” portion of the specific jurisdiction analysis (which Ford challenged), not the purposeful availment portion (which Ford did not).
In an effort to tie it back to the “arise out of or relate to” provision, Justice Kagan noted that Ford’s conduct in Montana and Minnesota included advertising, selling, and servicing the same car models involved in the plaintiffs’ lawsuits: because Ford “systematically served a market in Montana and Minnesota for the very vehicles that the plaintiffs allege malfunctioned and injured them in those States,” “there is a strong ‘relationship among the defendant, the forum, and the litigation’—the ‘essential foundation’ of specific jurisdiction.”
So what does this mean for the two-part specific jurisdiction test that Justice Kagan set forth in the beginning of the opinion? If evidence of purposeful availment is sufficient to satisfy the “arise out of or relate to” provision, is there even a two-part test anymore?
The Court’s discussion of its 2017 opinion in Bristol-Myers Squibb Co. v. Superior Court of California suggests a potential limitation. In that case, a large group of both California residents and non-California residents joined in a lawsuit against Bristol-Myers in connection with the drug Plavix. In an 8-1 opinion, the Court held that California lacked specific personal jurisdiction over Bristol-Myers on the claims asserted by the non-residents. Although the company engaged in business in California and sold Plavix there, the nonresident consumers did not purchase or ingest the drug in California, and they were not injured by the drug in California. The fact that others were prescribed, obtained, and ingested the drug in California was irrelevant. What was missing was “a connection between the forum and the specific claims at issue.”
In today’s opinion, the Court distinguished Bristol-Myers on the ground that the Ford injuries occurred in Minnesota and Montana and involved residents of those states. In that vein, at least, the Court’s opinion leaves room for limitation on the practice of “forum shopping;” its holding may have been different if both plaintiffs had filed suit in a forum that had no direct connection to their injuries (such as California).
Aside from that, the majority’s opinion appears to dramatically shift the focus of the “arise out of or relate to” analysis. Justice Gorsuch’s concurring opinion tends to agree with this concern, calling the majority’s analysis “a new and amorphous ‘affiliation’ test.” He explained:
Where this leaves us is far from clear. For a case to “relate to” the defendant’s forum contacts, the majority says, it is enough if an “affiliation” or “relationship” or “connection” exists between them. Ante, at 6, 12, 16. But what does this assortment of nouns mean? Loosed from any causation standard, we are left to guess. The majority promises that its new test “does not mean anything goes,” but that hardly tells us what does. Ante, at 9. In some cases, the new test may prove more forgiving than the old causation rule. But it’s hard not to wonder whether it may also sometimes turn out to be more demanding.
In short, today’s decision is a hard turn away from the personal jurisdiction jurisprudence that has been trending in favor of products defendants in recent years. With more uncertainty in an already uncertain area, it appears the Court is leaving it to litigants to sort out for now.
 The Opinion is currently available on the Supreme Court’s website at https://www.supremecourt.gov/opinions/20pdf/19-368_febh.pdf.
 Slip Op. at 8.
 Slip Op. at 4.
 Slip Op. at 6 (quoting Worldwide Volkswagen Corp. v. Woodson, 444 U.S. 286, 298 (1980)).
 471 U.S. 117 (2014)
 Slip Op. at 5 (quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)).
 Slip Op. at 6 (quoting Walden v. Fiore, 571 U.S. 277, 285 (2014)).
 Slip Op. at 6 (quoting Bristol-Myers Squibb Co. v. Super. Ct. of Cali., 137 S. Ct. 1773, 1781 (2017).
 Slip Op. at 8.
 Slip Op. at 9-10.
 Slip Op. at 10.
 Slip Op. at 10 (emphasis added).
 Slip Op. at 12 (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984)).
 137 S. Ct. 1773 (2017).
 Id. at 1778.
 Id. at 1778-84.
 Slip Op. at 4 n.1 (Gorsuch, J., concurring).
 Slip Op. at 3 (Gorsuch, J., concurring).