Business Law

Business Law News 2017, Issue 3

Bristol-Myers Squibb Co. v. Superior Court of California for the County of San Francisco: U.S. Supreme Court Rejects California’s "Sliding Scale" Test for Asserting Specific Jurisdiction over Non-Residents’ Claims

Cliford Zatz and Josh Foust

Clifford J. Zatz is a partner in the Washington, DC office of Crowell & Moring LLP. He has litigated product liability, toxic tort, environmental, wrongful death, breach of contract, intellectual property, and cases of emerging risks, such as online defamation and cyber security, in the courts of more than twenty states.

Josh Thomas Foust, a counsel at Crowell & Moring, is a member of the firm’s Litigation and Mass Tort, Product, and Consumer Litigation groups. Based in San Francisco, Josh focuses his practice on class action defense, consumer fraud and false advertising actions, complex commercial litigation, and financial services and securities litigation, in California and many other jurisdictions.

On June 19, 2017, the U.S. Supreme Court issued the latest in a series of decisions clarifying the constitutional limits on where corporations may be sued outside their "home" forums. In Bristol-Myers Squibb Co. v. Superior Court of California for the County of San Francisco, No. 16-466, the Court held, 8-1, that California state courts had no jurisdiction to hear the claims of non-California residents against Bristol-Myers Squibb Co. (BMS), a Delaware corporation headquartered in New York. Writing for the majority, Justice Samuel Alito held that BMS’s sales of its drug Plavix to California consumers, however extensive, were not enough to create personal jurisdiction, given that (1) the non-resident plaintiffs did not claim to have suffered injury in California, and (2) all the conduct giving rise to their claims occurred outside California.

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