Concept
Arising Out Of or Relating To
Specific jurisdiction
Arising Out Of or Relating To
Purposeful availment does not finish the specific-jurisdiction inquiry. A defendant that has reached into the forum may still be sued there only on claims that arise out of or relate to its forum contacts. The analysis therefore runs in two steps. The first asks what the defendant itself did in the forum, which the preceding sections developed. The second asks whether the plaintiff's claim connects to that conduct, and it decides which lawsuits the defendant's forum relationship may carry.
Specific jurisdiction binds a defendant that is not at home in the forum on a lighter connection than general jurisdiction demands, and that lighter connection is fair only for claims that grow out of it. If any purposeful contact, however small, opened the forum to every claim against the defendant, specific jurisdiction would collapse into the all-purpose power reserved for defendants that are essentially at home. The relatedness step keeps the two apart.
Two decisions fix the boundaries of that step. Bristol-Myers Squibb Co. v. Superior Court answers the first question: each plaintiff's claim needs its own link to the forum, however much business the defendant does there, so one defendant can be subject to jurisdiction on one plaintiff's claim and not on another's even when the claims are similar.1 Ford Motor Co. v. Montana Eighth Judicial District Court answers the second: how close the link must be once the defendant's forum activity is substantial, and it holds that the link need not be causal. Bristol-Myers comes first because it sets the requirement that Ford then explains.
Each Claim Needs Its Own Forum Link
Bristol-Myers Squibb Co. v. Superior Court holds that specific jurisdiction requires a connection between the forum and each plaintiff's claim. A state court therefore cannot exercise personal jurisdiction over a defendant on nonresident plaintiffs' claims that lack any forum-related activity or in-forum injury, even when the defendant is subject to jurisdiction in that state on resident plaintiffs' similar claims.2 As the dissent observed, no one disputed that the defendant had purposefully availed itself of California on a large scale, so the decision turns entirely on relatedness, the second step.3 With availment settled, the Court had to say what a defendant's forum activity can carry, and its answer is that forum contacts support only the claims connected to them.
The defendant is a pharmaceutical company incorporated in Delaware and headquartered in New York, with substantial operations in New York and New Jersey.4 It also did a great deal in California: five research and laboratory facilities employing about 160 people, roughly 250 sales representatives, a small state-government advocacy office in Sacramento, and sales of almost 187 million Plavix pills between 2006 and 2012 that brought in more than $900 million, a little over one percent of its nationwide revenue.5 What it did not do in California was develop Plavix, create a marketing strategy for it, or manufacture, label, package, or seek regulatory approval for it. All of that took place in New York or New Jersey.6
Eighty-six California residents and 592 residents of 33 other states sued in California Superior Court on 13 California-law claims, including products liability, negligent misrepresentation, and misleading advertising.7 The nonresidents did not allege that they obtained Plavix through California physicians or any other California source, and they did not claim that Plavix injured them in California or that they were treated for their injuries there.8
The trial court first found general jurisdiction. After Daimler AG v. Bauman, the Court of Appeal held that general jurisdiction was lacking, and the California Supreme Court unanimously agreed.9 That left specific jurisdiction. A divided California Supreme Court upheld it under a “sliding scale approach,” by which “the more wide ranging the defendant's forum contacts, the more readily is shown a connection between the forum contacts and the claim.”10 The company's extensive contacts therefore permitted a less direct link between its forum activities and the claims, and the court found that link in the similarity of the nonresidents' claims to the residents' claims, which rested on the same allegedly defective product and the assertedly misleading marketing of it.11
The Supreme Court reversed, and its reason lies in what makes specific jurisdiction specific. A court exercising it needs an affiliation between the forum and the underlying controversy, principally an activity or occurrence in the forum state. When that connection is missing, jurisdiction fails regardless of the extent of the defendant's unconnected activities in the state.12 The sliding scale relaxed the required connection as unrelated contacts increased, which the Court called “a loose and spurious form of general jurisdiction.”13 The label fits. General jurisdiction may reach any claim because it is confined to defendants that are at home in the forum, and a rule that let substantial sales or facilities soften the claim requirement would give a defendant that is not at home the same exposure without the same limit. The Court had already said that even regularly occurring sales of a product in a state do not justify jurisdiction over a claim unrelated to those sales.14
A second reason lies in the burden the defendant bears. That burden includes the abstract matter of submitting to the coercive power of a state that may have little legitimate interest in the claims in question, because the sovereignty of each state implies a limit on the sovereignty of its sister states.15 On that view, more than $900 million in California sales could not make California the right forum for a nonresident's Plavix injury that occurred elsewhere, since the states where the nonresidents lived, obtained the drug, and were hurt are the states with a stake in those claims. The federalism interest can be decisive even where the defendant would suffer minimal inconvenience and the forum is the most convenient place to litigate.16
The Plavix complaint put both sides of the line in one lawsuit. The California residents were prescribed, obtained, and ingested Plavix in California and allegedly sustained the same injuries the nonresidents claimed, so their claims connected directly to the company's California marketing and sales, and specific jurisdiction over them was uncontested.17 The nonresidents had the same drug, the same injuries, and the same defendant, yet they were not prescribed Plavix in California, did not purchase or ingest it there, and were not injured by it there.18 That other plaintiffs did those things in California does not allow the state to assert jurisdiction over the nonresidents' claims, because a defendant's relationship with a third party, standing alone, is an insufficient basis for jurisdiction, even when those third parties can bring claims similar to the nonresidents'.19 Nor did it matter that the company conducted research in California on matters unrelated to Plavix. In the Court's words, “What is needed—and what is missing here—is a connection between the forum and the specific claims at issue.”20
Walden v. Fiore supplied the closest comparison. Nevada residents there were searched in Georgia before boarding a flight to Nevada, and the Nevada courts lacked specific jurisdiction over the officer even though the plaintiffs lived in Nevada and suffered foreseeable harm there, because the relevant conduct occurred entirely in Georgia.21 In Bristol-Myers the link was weaker still, since the nonresidents neither lived in California nor claimed harm there, and all the conduct giving rise to their claims occurred elsewhere.22
The nonresidents also invoked Keeton v. Hustler Magazine, Inc. and Phillips Petroleum Co. v. Shutts, and the Court found neither helpful. Keeton concerned jurisdiction to determine the scope of a claim involving in-state injury and injury to residents of the forum, whereas the nonresidents' claims involved neither. Shutts concerned the due process rights of plaintiffs and has no bearing on whether the forum's connection to these claims suffices.23
The distribution contract fared no better. The company had contracted with McKesson, a California company, to distribute Plavix nationally, but the nonresidents did not allege that the company engaged in relevant acts together with McKesson in California or that it was derivatively liable for McKesson's conduct there. The bare fact of contracting with a California distributor is not enough to establish personal jurisdiction in the state.24 The contract is a genuine California contact, and the dissent counted it among the company's purposeful ones.25 But a contact answers only the availment question, and the claims still needed a connection to something done in California.
The requirement runs claim by claim as well as plaintiff by plaintiff. A court ordinarily must have personal jurisdiction over each claim by each plaintiff, and jurisdiction over one claim does not automatically carry the rest of the case with it.26 Suppose an Alaska hotel mails misleading brochures to a Massachusetts business, which books a convention at the hotel on the strength of them. The business can sue the hotel in Massachusetts for fraud, because that claim grows out of the advertising the hotel sent there. If the business adds a negligence claim for income lost when an employee drowned in the hotel's Alaska pool, jurisdiction over the fraud claim does not automatically extend to it. The business must show that the negligence claim arises out of the hotel's forum contacts. If it cannot, and it wants both claims in one court, it must sue in Alaska.27
The tempting error is to reason that a defendant with enormous forum sales, facing identical claims from residents, must answer every similar claim there. That argument is the sliding scale in new words, and it fails at the third step.
In an 8–1 decision, Justice Sotomayor dissented and would have upheld jurisdiction. She read “relate to” to reach claims that concern conduct materially identical to acts the company took in California, here its nationwide marketing and distribution of Plavix, and she observed that residents and nonresidents alike alleged injury from the same essential acts: “Our cases require no connection more direct than that.”32 She also argued that Walden concerned the requirement of purposeful availment, not the separate requirement that a claim arise out of or relate to forum contacts, and that Keeton shows no unfairness when a defendant faces liability in a single state for a single course of conduct that has impact in many states.33 On reasonableness, she reasoned that the company already faced identical claims from residents and so would bear little added burden, while litigating in as many as 34 states would be far more burdensome and would cost plaintiffs whose claims may be too small to bring alone.34 The dissent is not the rule, but it names what the majority's approach costs: similar claims by people injured through a national course of conduct become harder to prosecute together.35
The Court also said what the decision does not prevent. The California residents and the nonresidents may still sue together in a consolidated action in a state that has general jurisdiction over the company, such as Delaware, where it is incorporated, or New York, where it is headquartered, and the nonresidents could probably sue together in their respective home states.36 Because the decision concerns the Fourteenth Amendment's limits on a state's exercise of specific jurisdiction, it leaves open whether the Fifth Amendment imposes the same restrictions on a federal court's exercise of personal jurisdiction.37 Bristol-Myers thus settles that each claim needs its own link. It does not say how close the link must be for plaintiffs who do live and get hurt in the forum, and that is the question Ford answers.
“Relate To” Reaches Beyond Causation
Ford Motor Co. v. Montana Eighth Judicial District Court holds that a state may exercise specific jurisdiction over a manufacturer that has extensively advertised, maintained dealerships, and supplied replacement parts in the state, creating and exploiting a market there, when a resident's product-liability claim “relates to” those contacts, even if the particular product was not designed, manufactured, or first sold in the forum. The preceding section established that specific jurisdiction needs a connection between the forum and each plaintiff's claim. This decision says how tight that connection must be: real, but not necessarily causal. Because Ford conceded purposeful availment, the case also shows relatedness in isolation.
Two accidents produced the two suits. A 1996 Ford Explorer malfunctioned and killed Markkaya Gullett near her home in Montana. Adam Bandemer was injured in a collision on a Minnesota road involving a defective 1994 Crown Victoria. Each suit was brought in the state court of the state where the accident happened.39 Ford had designed both models in Michigan and built them in Kentucky and Canada, and it had first sold the two cars in Washington and North Dakota, so only later resales and relocations by consumers had brought them to Montana and Minnesota.40 Ford moved to dismiss, arguing that a state court has jurisdiction only if Ford's conduct in the state gave rise to the claims, which in practice meant that Ford had designed, manufactured, or most likely sold the very vehicle there.41 Both state supreme courts rejected that argument, and the Supreme Court affirmed.42
Ford did not dispute that it does substantial business in both states, and it agreed that it had purposefully availed itself of the privilege of conducting activities in each.43 Its objection was that those activities did not connect closely enough to the suits, because jurisdiction attaches “only if the defendant's forum conduct gave rise to the plaintiff's claims.”44 A causal rule has an obvious appeal, since a manufacturer could identify the permitted states by tracing the history of one vehicle. The cost is that a company that spends heavily to put a model on a state's roads could not be sued there when a resident was hurt by that model, because the particular car happened to be sold elsewhere. Many lower courts had read the phrase as requiring at least a but-for causal link, so Ford's position tracked a common reading.45
The Court's reply begins with the words courts use to state the requirement: the suit must “arise out of or relate to the defendant's contacts with the forum.”46 The first half of that phrase asks about causation. The back half, after the “or,” contemplates that some relationships will support jurisdiction without a causal showing.47 That does not mean anything goes, because “relate to” incorporates “real limits,” which protect defendants that are foreign to the forum.48 The limits matter because a looser reading would erase the line between specific and general jurisdiction. The Court rejected the idea that a state court could hear any claim against a nationwide corporation, however unrelated to the state. Its example was a California court hearing an Ohio plaintiff's claim over an Ohio accident involving a car bought in Ohio, a result that would leave case-linked jurisdiction linked to no case at all.49
The Court found its model for a non-causal relationship in World-Wide Volkswagen Corp. v. Woodson. That decision held that Oklahoma could not reach a New York retailer and a regional distributor whose only tie to the state was a customer's decision to drive there. A consumer's unilateral act of bringing the product into the forum cannot supply the defendant's contact, and the car's mobility did not change that.50 The same opinion contrasted those defendants with Audi, the manufacturer, and Volkswagen, the importer. A manufacturer whose sales arise from efforts to serve, directly or indirectly, the market for its product in other states may reasonably be sued in one of them when its merchandise injures an owner there.51 That observation tied a forum accident to market-serving contacts even though the car in that case had been sold in New York. Ford called the passage dicta, and the Court agreed that it is technically dicta. But later decisions repeated it, and Daimler used the same scenario as a paradigm case of specific jurisdiction.52 What separates the two groups of defendants in World-Wide Volkswagen is whether the defendant served the forum market, and Ford shares that fact with Audi and Volkswagen.
Ford's own contacts place it on the market-serving side. It urged Montanans and Minnesotans to buy its vehicles, including the Explorer and the Crown Victoria, through billboards, television and radio spots, print ads, and direct mail. It sold new and used cars through 36 dealerships in Montana and 84 in Minnesota. Its dealers repaired cars whose warranties had long expired, and it distributed replacement parts to its own dealers and to independent shops.53 Each plaintiff's suit arose from an accident in one of those states and alleged that a defective model Ford had advertised, sold, and serviced there for many years caused the harm.54 Ford had therefore systematically served a market in the forum for the very vehicles that allegedly malfunctioned and injured the plaintiffs there, which produced a strong “relationship among the defendant, the forum, and the litigation,” the “essential foundation” of specific jurisdiction.55
Ford's last argument was that the plaintiffs' claims would be precisely the same if Ford had never done anything in either state. The Court answered that the argument restates the demand for an exclusively causal test, and that its premise was doubtful in any event. The owners might never have bought their cars except for Ford's contacts with their home states, which can turn a resident into a Ford owner even when the purchase is made out of state.56 The plaintiffs had not established or even alleged such causal links, and the Court refused to make jurisdiction ride on the exact reasons for one plaintiff's purchase or on that plaintiff's ability to prove them.57 A rule that turned on a single buyer's motives would reveal nothing about what the defendant has done in the forum.
The fairness account explains why “relate to” stays tied to the defendant's own conduct, and it has two parts. The first is reciprocity. A company that does so much business in a state enjoys the benefits and protection of its laws, such as the enforcement of contracts, the defense of property, and the formation of effective markets. Those benefits create reciprocal obligations, most relevantly that the models it markets so extensively be safe for residents to use there.58 The second is predictability. An automaker that regularly markets a vehicle in a state has clear notice that it will answer in that state's courts when the product malfunctions there, wherever the car was first sold, and it can structure its conduct to reduce or avoid the cost of that litigation.59 Both supports attach to the model Ford chose to market in the forum. The place where one unit was first sold is a detail about a single car, which is why that detail adds nothing.
Bristol-Myers Squibb Co. v. Superior Court lies on the other side of the line. The drug maker there also did enormous business in the forum, and it still could not be sued by nonresidents injured elsewhere.60 Ford pointed out that the lack of connection in Bristol-Myers rested partly on the fact that those plaintiffs were not California residents and did not claim to have suffered harm there, whereas the Ford plaintiffs lived in the forum, used the products there, and were injured there.61 Both defendants had large forum businesses, which leaves the plaintiff-specific tie as the fact that moved the result. Ford's reliance on Walden v. Fiore fared no better. The officer in Walden had never formed a contact of his own with Nevada, so a plaintiff's residence and place of injury could not create one. Those facts remain relevant, though, to the link between a defendant's existing forum contacts and the plaintiff's suit.62 The order of inquiry follows: the defendant's own contact comes first, and the plaintiff's residence and injury then help show how closely the claim connects to it.
The Court marked the edge of its holding by setting aside, without deciding, a case in which Ford marketed the models in only a different state or region.63 A hypothetical shows what that edge looks like.
The opinion does not resolve that dispute, and the maker's reply draws on the rule that substantial forum business unrelated to the claim cannot supply the missing link.64 One useful way to understand the result is that Ford could plainly have been sued in those states over a car it sold there, so a claim over the same model sold elsewhere is similar enough to that exposure to relate to it, although the opinion never says how similar a claim must be.65 The Court added two further cautions. It did not say that anyone using any means to sell any good in a state is subject to jurisdiction there when the product malfunctions after arrival, because isolated or sporadic transactions have long been treated differently from continuous ones. It also did not consider internet transactions, which may raise doctrinal questions of their own.66 At oral argument, a hypothetical described a retired man in a small Maine town who carves decoys and sells them through a website, and it asked whether he could be sued in any state where a decoy caused harm. The Court said the differences between that case and these “virtually list themselves,” so resolving these cases does not resolve the hypothetical.67
Justices Alito and Gorsuch each wrote separately, concurring only in the judgment, and their quarrel is with the majority's reading of the phrase. Justice Alito agreed that Ford's demand for strict proof of causation fails, but he found the link here causal in a broad sense, since the whole point of Ford's activities was to put more Fords on those roads. On that view, personal jurisdiction can rest on this link without strict proof of the kind Ford required, and “arise out of” and “relate to” overlap rather than state two discrete grounds. The phrase simply restates the basic minimum-contacts standard of International Shoe.68 Justice Gorsuch objected that the majority promises its new test “does not mean anything goes,” but that “hardly tells us what does.” He asked whether the new test might sometimes prove more demanding than the old causation rule, and whether the majority would treat causation and “affiliation” as alternative routes to specific jurisdiction or would deny jurisdiction outright.69 Neither concurrence states the holding. Justice Barrett took no part in the decision, and the eight participating Justices agreed on the result.70
The third step does the work this decision added, and it is also where answers go wrong in two opposite directions. A student who insists that the plaintiff trace the car to a forum sale has reimposed the causal test the Court rejected. A student who reads the decision to mean that any defendant with forum business may be sued on any related product has erased the limits the Court said “relate to” retains, and the fourth step corrects that error.