SCOTUS Speaks on General Jurisdiction, Hague Service, and Arbitration Clauses
Complex Litigation columnist Michael Hoenig writes: In case readers haven't noticed, the U.S. Supreme Court has been busy issuing recent rulings that can affect litigation practice. In the last month, the justices issued a significant decision rejecting general jurisdiction over a defendant in a state where that defendant was neither incorporated nor headquartered; held that service of process of a foreign defendant by mail is permitted by the terms of the Hague Service Convention, provided the foreign country has not objected to such service by mail; and ruled that a nursing home's arbitration agreement had to be enforced as preempting tort claims for injuries filed in Kentucky courts.
June 09, 2017 at 02:03 PM
8 minute read
In case readers haven't noticed, the U.S. Supreme Court has been busy issuing recent rulings that can affect litigation practice. In my column last month, the Court's pronouncement on sanctions for discovery misconduct was discussed. Since then the nation's high court has: (1) issued a significant decision on May 30 rejecting general jurisdiction over a defendant in a state where that defendant was neither incorporated nor headquartered (BNSF R. Co. v. Tyrrell, 2017 U.S. LEXIS 3395); (2) held on May 22 that service of process of a foreign defendant by mail is permitted by the terms of the Hague Service Convention, provided the foreign country has not objected to such service by mail (Water Splash v. Menon, 2017 U.S. LEXIS 3212); and (3) ruled on May 15 that a nursing home's arbitration agreement had to be enforced as preempting tort claims for injuries filed in Kentucky courts (Kindred Nursing Centers L.P. v. Clark, 2017 U.S. LEXIS 2948).
Because this article discusses three decisions of broad sweep and space here is limited, our focus is on the pith and substance of each ruling and its likely impact for the practitioner, rather than describing the thicket of facts and circumstances considered by the courts below in each case. If a particular topic resonates with the reader, he or she can take it from there as far as the details go.
General Jurisdiction
Two separate Federal Employers' Liability Act (FELA) lawsuits for personal injuries were filed in Montana state court against BNSF, a railway company with over 2,000 miles of track in Montana and more than 2,000 workers in the state. However, neither plaintiff Robert Nelson's knee injuries nor decedent Brent Tyrrell's exposure to carcinogenic chemicals arose from or related to work performed for BNSF in Montana. Neither injured worker resided in Montana. Further, despite having about 6 percent of its total railroad track and less than 5 percent of its total workers in Montana, BNSF was not incorporated there nor had its principal place of business there. It was a Delaware corporation headquartered in Texas. BNSF operates railroad lines in 28 states.
BNSF moved to dismiss both lawsuits on jurisdictional grounds. It contended that it was not “at home” in Montana, as required for the exercise of general personal jurisdiction under Daimler AG v. Bauman, 571 U.S. ___ (2014), the U.S. Supreme Court's pivotal decision. The lower courts dismissed Nelson's case but denied the motion in Tyrrell's. The Montana Supreme Court consolidated the two cases and held that Montana courts could exercise general personal jurisdiction over BNSF. The state court advanced two reasons: The FELA authorized state courts to exercise personal jurisdiction over railroads “doing business” in the state and, further, Montana law authorizes exercise of general jurisdiction over “[a]ll persons found within” the state.
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