The U.S. Supreme Court’s Decision in Ford Motor Co. v. Montana Eighth Judicial District Court and the Refinement of Case Law on Specific Personal Jurisdiction

Introduction:

            On March 25, 2021, the U.S. Supreme Court issued its decision in Ford Motor Co., v. Mont. Eighth Judicial Dist. Court, 131 S. Ct. 1017 (2021), rejecting Ford’s argument that specific jurisdiction attaches “only if the defendant’s forum conduct gave rise to the plaintiff’s claims,” and held that “[w]hen a company like Ford services a market for a product in a State and that product causes injury in the State to one of its residents, the State’s courts may entertain the resulting suit.” Id. at 1026–27.

            In reaching its decision, the U.S. Supreme Court refined its case law by parsing the phrase “must arise out of or relate to the defendant’s contacts” and thus, established a new category of cases in which personal jurisdiction is recognized:  “those in which the claims do not ‘arise out of’ (i.e., are not caused by) the defendant’s contacts but nevertheless sufficiently ‘relate to’ those contacts in some undefined way.” Id. at 1033 (J. Alito, concurring).

Background:

            In two cases, Ford Motor Co. v. Montana Eighth Judicial District Court and Ford Motor Co. v. Bandemer, Ford Motor Co. was sued for injuries sustained in accidents involving two Ford vehicles. Ford Motor Co., 131 S. Ct. 1017 at 1023. In Minnesota, Adam Bandemer was a passenger in a Crown Victoria that rear-ended a snowplow and landed in a ditch. Id. Bandemer’s air bag failed to deploy, and he suffered serious brain damage. Id. Bandemer sued Ford in Minnesota state court, asserting products-liability, negligence, and breach-of-warranty claims. Id. In Montana, Markkaya Gullett was driving her Explorer when the tread separated from her tire and her car rolled into a ditch. Gullett was pronounced dead at the scene of the crash. Id. The representative of Gullett’s estate sued Ford in Montana state court, asserting design defect, failure to warn, and negligence claims. Id.

            In both lawsuits, Ford moved to dismiss the case for lack of personal jurisdiction, arguing that because Ford had not sold, designed, or manufactured the vehicle involved in the accident in the state, a casual connection between the plaintiffs’ suits and the defendant’s activities did not exist and thus, Ford could not be subject to the state court’s jurisdiction. Id. The Minnesota and Montana Supreme Courts rejected Ford’s argument and affirmed the decision of the lower court. Id.

            The U.S. Supreme Court granted certiorari and consolidated the cases to consider if Ford was subject to jurisdiction. Id, at 1024.

The U.S. Supreme Court’s Decision:

            Justice Kagan, writing for the majority, affirmed each of the state court’s decisions and  held that “[w]hen a company like Ford serves a market for a product in a State and that product causes injury in the State to one of its residents, the State’s courts may entertain the resulting suit.” Id. at 1022. 

            Specific jurisdiction, Justice Kagan wrote, “covers defendants less intimately connected with a State, but only as to a narrower class of claims. . . . The defendant, . . . must take some act by which [it] purposefully avails itself of the privilege of conducting activities within the forum State. . . . The plaintiff’s claims . . . must arise out of or relate to the defendant’s contacts with the forum.” Id. at 1025 (internal quotations omitted).

            In support of its decision, the Court noted that Ford agreed that it had purposely availed itself to the States’ markets and actively sought to serve the States’ market for automobiles and related services. Id. at 1026. In particular, the Court cited to Ford’s extensive advertisement efforts and fact that Ford cars—including the Explorer and Crown Victoria models at issue—are widely available for sale and resale, throughout each State. Id. The Court noted that Ford works hard to foster ongoing connections with its owners by making dealerships widely available to its consumers for the maintenance and repair of Ford cars, thus, making it easy and desirable to be a Ford owner. Id. Additionally, the Court noted that the injuries sustained while riding in the Ford vehicles occurred in the residents’ home state. Id.

            In rendering its decision, the Court rejected Ford’s proposed, yet unprecedented, rule that would have required a defendant’s contacts with the forum State to have been the but-for cause of the tort plaintiff’s injury and, instead, based its decision on the Court’s existing understanding of “traditional notions of fair play and substantial justice” and precedent from International Shoe Co. v. Washington, 326 U.S. 310 (1945), Bristol-Myers Squibb Co. v. Superior Ct. of California, San Francisco Cty., 137 S. Ct. 1773 (2017), and World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980). See id. at 1026–32.             

The Concurrences:

            As Justice Alito and Justice Gorsuch, with whom Justice Thomas joined, point out in their concurring opinions, the refinement of the specific jurisdiction test in this case seems unnecessary and may prove difficult for the courts and litigants alike to apply moving forward.

            As Justice Alito stated, “[r]ecognizing ‘relate to’ as an independent basis for specific jurisdiction risks needless complications” to the specific jurisdiction test because “[t]he ‘ordinary meaning’ of the phrase ‘relate to’ is a broad one.”  And noted that applying the phrase “relate to,” “according to its terms is a project doomed to failure, since, as many a curbstone philosopher has observed, everything is related to everything else.” Id. at 1033 (J. Alito, concurring). Additionally, Justice Alito criticizes the majority’s assurances that the refined phrase “relate to” “incorporates real limits” because the Court failed to provide “any indication [to] what those limits might be . . . .” Id.

            Similarly, Justice Gorsuch expressed his discontent with the guidance this decision provides for the lower courts. Specifically, he stated “[f]or 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. . . . But what does this assortment of nouns mean?” Id. at 1035 (J. Gorsuch, concurring). 

The Future of Specific Jurisdiction:

            The vagueness of the refined specific jurisdiction test will likely result in the lower courts conducting fact intensive inquiries in specific jurisdiction cases. This will lead to inconsistent outcomes and confusion among the lower courts until they have the opportunity to work out and develop the standard over time.

            Additionally, this ruling may make it easier for plaintiffs to bring state court actions against defendant manufacturers that do business nationwide because specific jurisdiction may now be recognized in situations in which the plaintiff’s claims are not caused by the defendant manufacturer’s contacts, but nevertheless relate to those contacts.

            While the Supreme Court’s refinement of the specific jurisdiction test could expand personal jurisdiction in unforeseeable ways, the Court did distinguish the circumstances in Bristol-Myers Squibb to those in the present case, leaving the precedent of Bristol-Myers Squibb intact. Id. at 1030–33. Thus, Bristol-Myers Squibb can be relied on when defending expansive personal jurisdiction claims and to protect against plaintiff forum shopping.

            Ultimately, the burden to apply “traditional notions of fair play and substantial justice” will be on the lower courts. Manufacturers should keep a careful watch on how this area of the law develops in the upcoming months and years. Furthermore, manufacturers should be mindful of and ready to defend against lawsuits in jurisdictions where they might not have otherwise been subject to personal jurisdiction. 

Attorney Richard Dighello is the Chair of Updike, Kelly & Spellacy’s Product Liability and Toxic Tort Practice Group and a member of the Construction Practices Group.  Attorney Dighello practices primarily in the areas of product liability, construction law, commercial litigation and asbestos defense. He can be reached at rdighello@uks.com or at (860) 548-2633.

Paige L. Owens is an associate in the Firm’s Hartford office, where she practices in the areas of commercial lending and banking, real estate finance and leasing, real estate development and residential real estate sales and acquisitions. While in law school, Ms. Owens served as the Lead Articles Editor for the Connecticut Law Review and a member of the Connecticut Moot Court Board.  She can be reached at powens@uks.com or at (860) 548-2653.

Disclaimer: The information contained in this material is not intended to be considered legal advice and should not be acted upon as such. Because of the generality of this material, the information provided may not be applicable in all situations and should not be acted upon without legal advice based on the specific factual circumstances.