Unanimous SCOTUS decision in Ford case a big win for consumers, clarifies doctrine of personal jurisdiction

Jocelyn D. Larkin, Executive Director

The Supreme Court’s recent 8-0 decision in Ford Motor v. Montana Eighth Judicial District Court, No. 19-368 (U.S.S.C. March 25, 2021), on personal jurisdiction is a feast for those who love civil procedure and a victory for consumers. Former Impact Fund board member Deepak Gupta of Gupta Wessler, PLLC presented oral argument via phone this past October on behalf of the families of people injured or killed in accidents in Montana and Minnesota involving Ford vehicles.

This case is, like Bristol-Myers v. Superior Court, about whether state courts can exercise specific personal jurisdiction over a corporate defendant in individual personal injury actions. This case does not involve either class actions or claims in federal court. Instead, this case was an effort by a global corporate defendant to push Bristol-Myers still further in the direction of limiting the forums in which victims of corporate malfeasance may sue defendants. In this case, Ford got no traction from any of the justices even those who were in the majority in Bristol-Myers. 

The issue was straightforward. In two separate cases against Ford, victims were injured or killed in Ford automobiles. They sued in state court in the states where they lived and where the accidents and injuries occurred—Montana and Minnesota. Ford argued that the two state courts could not exercise personal jurisdiction over the claims because the specific cars involved in the accidents were designed, manufactured, and sold by Ford outside the forum states. The cars arrived in the forum states because the owners either purchased them used or relocated there. In other words, Ford’s proposed test was that courts may exercise personal jurisdiction only if there is a direct causal link between its conduct within the state and the plaintiff’s injuries.  

Recall that there are two kinds of personal jurisdiction: “general” and “specific.” General jurisdiction can be exercised anywhere that a corporation is “at home” – its place of incorporation and principal place of business. General jurisdiction was off the table in both cases as Ford is incorporated in Delaware and headquartered in Michigan. “Specific” or “case linked” personal jurisdiction looks to whether the defendant has “purposefully availed” itself of the privilege of conducting business in the forum state. The plaintiff’s claims “must arise out of or relate to the defendant’s contacts” with the forum, and those contacts need to be more than isolated or sporadic. A defendant who takes advantage of the benefits of doing business in the state has “fair warning” that it could be subject to the jurisdiction of that state and can be fairly held to account in that state’s courts.

Ford conceded that it had purposefully availed itself of the Montana and Minnesota markets. It “systematically” advertised, sold, and repaired its cars in these states, including the models at issue. As Justice Kagan wryly observed in the majority opinion, “Ford had a veritable truckload of contacts with Montana and Minnesota.” The Court concluded that the relationship among the defendant, the forums, and the litigation was “close enough” to support specific jurisdiction. 

The Court distinguished the facts in Bristol Myers in which the plaintiffs themselves had no connection to the forum state (California) and were, in Justice Kagan’s words, “engaged in forum-shopping.” Ford had a hard time convincing the Court that these plaintiffs should have to leave their home state and travel to the state where the car was first purchased or where it was manufactured to satisfy specific jurisdiction.

The majority opinion was joined by Chief Justice Roberts and Justices Breyer, Sotomayor and Kavanaugh. Justice Alito wrote a concurrence, as did Justice Gorsuch joined by Justice Thomas. Justice Barrett took no part in the case. 

Justice Alito’s concurrence disagreed only about the “new gloss” that the Court put on the case law. He objected to the Court parsing the phrase “must arise out of or relate to the defendant’s contacts” to be disjunctive. In other words, the majority did not need to make “relate to” an “independent basis for specific jurisdiction.”

Justice Gorsuch’s concurrence questioned the continuing viability of International Shoe in light of the nationwide character of many corporations and observed that corporations “continue to receive special jurisdictional protections in the name of the Constitution. Less clear is why.” 

Is a revolution in personal jurisdiction jurisprudence on the horizon?