Supreme Court Applied ‘Settled Principles’ In BMS Ruling

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Leslie Brueckner of Public Justice and I just published an article in Law360 about the Supreme Court’s recent decision in  Bristol-Myers Squibb Co. v. Superior Court. Here it is in full:

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The U.S. Supreme Court’s June 26 ruling in Bristol-Myers Squibb Co. v. Superior Court[1] has been characterized by some in the defense bar as portending a sea change in “specific,” or “case-linked,” personal jurisdiction. Not so fast.

Although the case was closely watched by both sides of the aisle because of its potential to strictly limit plaintiffs’ ability to sue corporations outside of their “home” state, the 8-to-1 ruling was decided on “settled principles” of law[2] — and, as a result, it did not move the legal needle anywhere near as far as the defense bar was hoping.

In this case, both California and nonresident plaintiffs sued Bristol-Meyer Squibb (BMS), a national pharmaceutical company, for personal injuries caused by Plavix, a cardiovascular drug linked to strokes and other serious injuries. Because BMS is incorporated in Delaware and headquartered in New York, and conducts most of its operations on the East Coast, there was no basis for asserting “general,” or “all-purpose,” jurisdiction over BMS in California.[3]

Instead, the question was whether California courts could assert specific jurisdiction over BMS, which exists where the plaintiff’s claims “aris[e] out of or relat[e] to the defendant’s contacts with the forum.”[4]

Specific jurisdiction was a non-issue as to the California plaintiffs because they had bought their Plavix in California and were injured in the state.

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Class Cert Appeals & the Muddy Waters of the 9th Circuit

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In less than two weeks, the Supreme Court will hear oral argument on the following issue: Whether a federal court of appeals has jurisdiction to review an order denying class certification after the named plaintiffs voluntarily dismiss their individual claims with prejudice.

The underlying decision, which we’ve written about previously, is the Ninth Circuit’s ruling in Baker v. Microsoft.  In Baker, the district court struck class allegations, Plaintiffs sought leave to appeal under Federal Rule of Civil Procedure 23(f), and leave was denied.  Plaintiffs then voluntarily dismissed their individual claims with prejudice and appealed.  The Ninth Circuit concluded it had jurisdiction because the dismissal – even though it came by stipulation – was “sufficiently adverse” to be an appealable final decision.

With the Supreme Court poised to rule in Baker, the Ninth Circuit recently issued a second published decision involving a similar issue. Bates v. Bankers Life & Casualty Co.  In Bates, as in Baker, the district court granted a motion to strike class allegations.  From there, the posture of the cases diverged.  Rather than voluntarily dismissing with prejudice (as in Baker), the Bates plaintiffs filed an unopposed motion for entry of final judgment pursuant to Federal Rule of Civil Procedure 54(b).… Read more

For Defense Bar, Class Action and Arbitration Issues Remain Hot Topics for Supreme Court Review

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A recent post by Adam Feldman at Emprical SCOTUS entitled “Cert Filing Leaders” demonstrates that the defense bar’s interest in Supreme Court review of arbitration and class action issues has not abated, despite the passing of Justice Scalia, who often provided a fifth and decisive vote on such issues.

Feldman has reviewed cert petitions pending before the Supreme Court with an eye towards who is filing. He finds that Gibson Dunn, Sidley Austin, WilmerHale, Bancroft PLLC, Jones Day, Kellogg Huber, Latham & Watkins, and Mayer Brown “combine for 46 docket filings so far this year.” More interesting is that “[t]he most petitions from these firms so far this year are in the class action and arbitration areas,” with patent law taking third place.

At least insofar as class actions are concerned, this was a bit surprising. For one, recent efforts to secure a Supreme Court ruling which kills off class actions–think Spokeo, Inc. v. Robins or Campbell-Ewald Co. v. Gomez or Tyson Foods, Inc. v. Bouaphakeo–have largely failed (Robins, Gomez) or backfired (Bouaphakeo). For another, the Supreme Court may remain an 8-member court for a substantial portion of its October 2016 Term. Without a ninth Justice, the Court is unlikey to grant cert in cases which stand a high chance of resulting in a tie vote.… Read more

U.S. Supreme Court to Consider Appellate Jurisdiction to Review Denial of Class Cert After Named Plaintiffs Voluntarily Dismiss Suit With Prejudice

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In an earlier post, we flagged a cert petition filed in the U.S. Supreme Court by Microsoft Corporation, asking whether federal courts of appeals have jurisdiction to review a denial of class certification after the named plaintiff voluntarily dismisses his individual claims with prejudice. The issue arises in long-running litigation brought by consumers who purchased Xbox consoles which allegedly damage discs during use.

The Supreme Court has now granted review. Interestingly, it has rewritten the question presented, presumably to make clear that it wants argument on whether there is Article III jurisdiction and statutory jurisdiction under 28 U.S.C. § 1291. As rephrased by the Court, the question now is: “Whether a federal court of appeals has jurisdiction under both Article III and 28 U. S. C. §1291 to review an order denying class certification after the named plaintiffs voluntarily dismiss their individual claims with prejudice.”

Now that the Court has taken this case, it is worth observing that any victory by Microsoft would be pyrrhic. Because a class was not certified by the district court, but should have been according to the Ninth Circuit; and because the voluntary dismissal with prejudice binds only the named individuals in the Baker case, other consumers could simply file another class action seeking redress for the same consumer harm.… Read more