March 25, 2021

Supreme Court Decides Ford Motor Co. v. Montana Eighth Judicial District Court

On March 25, 2021, the U.S. Supreme Court decided Ford Motor Co. v. Montana Eighth Judicial District Court, holding that a state’s courts can exercise specific personal jurisdiction over a manufacturer in a product liability suit where the manufacturer purposefully availed itself of the benefits of that state’s market, the plaintiffs are residents of the state, and the accident giving rise to the lawsuit occurred in the state, even if the particular product at issue was not designed, manufactured, or first sold in the state.

Today’s decision involved two consolidated cases that originated in the Montana and Minnesota state courts. In the first, the estate of a Montana resident sued Ford Motor Company in Montana state court after the decedent was involved in a fatal accident in Montana while driving a Ford vehicle. In the second, a Minnesota resident sued Ford in Minnesota state court after he was involved in an accident in Minnesota while driving a Ford vehicle. Ford moved to dismiss both lawsuits for lack of personal jurisdiction. Ford argued that its conduct in the respective states did not give rise to the plaintiffs’ claims because neither vehicle was designed, manufactured, or first sold in either state. The Montana and the Minnesota supreme courts (affirming lower court decisions) rejected Ford’s arguments, and the Supreme Court “granted certiorari to consider if Ford [was] subject to jurisdiction in these cases.”

In an 8-0 decision, the Supreme Court affirmed the judgments of the Montana and Minnesota supreme courts. The Court first reviewed the differences between general jurisdiction and specific jurisdiction, and reiterated that specific jurisdiction was the issue in these cases. Specific jurisdiction requires two things: First, the defendant must “purposefully avail[ ] itself of the privilege of conducting activities within the forum State”; the contacts “must be the defendant’s own choice and not random, isolated, or fortuitous.” Second, the plaintiff’s claims “must arise out of or relate to the defendant’s contacts” with that state. The Court explained that these rules stem from the values of “treating defendants fairly and protecting interstate federalism.”

Ford agreed that it had “purposefully avail[ed] itself of the privilege of conducting” business in Montana and Minnesota. The Court therefore focused on the second piece of the specific jurisdiction requirement. Ford argued that it could be subject to personal jurisdiction in Montana and Minnesota only if its activities in those states “gave rise to the plaintiff’s claims.” The Court disagreed and said a “causation-only” approach is not supported by the Court’s requirement that there be a “connection” between a plaintiff’s suit and a defendant’s activities. The Court reasoned that the requirement that a suit “arise out of or relate to the defendant’s contacts with the forum” does not demand a causal showing in every case; rather, the second half of this rule “contemplates that some relationships will support jurisdiction without a causal showing.” The Court also explained that it has previously “stated that specific jurisdiction attaches in cases identical to the ones here” — where a manufacturer “serves a product in the forum State and the product malfunctions there.” The Court looked at Ford’s specific activities and concluded that Ford “advertised, sold, and serviced [the] two car models [at issue] in both States for many years.” When looking at how this conduct related to these cases, the Court reasoned that the accidents at issue happened in the forum states and the plaintiff-residents claimed that it was a defective Ford vehicle that caused the accidents and their respective harms. “In other words, Ford has systematically served a market in Montana and Minnesota for the very vehicles that the plaintiffs alleged malfunctioned and injured them in those States.” Looking at the values underpinning specific personal jurisdiction, the Court concluded that under these circumstances, “allowing jurisdiction in these cases treats Ford fairly” and “principles of interstate federalism” supported jurisdiction in Montana and Minnesota because those states had a more significant interest in the lawsuits than the states where the vehicles were designed, manufactured, or first sold.

In a footnote, the Court differentiated between “isolated or sporadic transactions” and “continuous ones” and said that “[n]one of this is to say that any person using any means to sell any good in a State is subject to jurisdiction there if the product malfunctions after arrival.” It also explained “we do not here consider internet transactions, which may raise doctrinal questions of their own.”

The Court also explained that today’s decision was consistent with its prior decisions in Bristol-Myers Squib and Walden. The facts in Bristol-Myers were different than those here because the non-resident plaintiffs in that case did not live in California, had not purchased the product at issue in California, and had not “used or suffered any harm from the drug there.” With respect to Walden, the Court explained that the defendant in that case had “never traveled to, conducted activities within, contacted anyone in, or sent anything or anyone to Nevada,” which meant he had not purposefully availed himself of Nevada’s protections and “the Court had no occasion to address the necessary connection between” his (non-existent) Nevada activities and the plaintiff’s claims.

Justice Kagan wrote the opinion of the Court, joined by Chief Justice Roberts and Justices Breyer, Sotomayor, and Kavanaugh. Justice Alito and Justice Gorsuch filed separate opinions concurring in the Court’s judgment, and Justice Thomas joined Justice Gorsuch’s opinion. Justice Barrett took no part in the consideration or decision of this case.

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