The jurisdiction cases reviewed by the U.S. Supreme Court are rarely headline-grabbing. Nonetheless, those cases exert a significant effect on the civil litigation that fills the nation’s dockets. This fall, the justices are considering two interesting cases from the U.S. Court of Appeals for the Ninth Circuit that may limit the ability of federal courts to exercise jurisdiction over parties in foreign districts.
Jurisdiction Over Foreign Parent Companies
Last month, the court heard argument in a California case that will provide guidance about when courts may exercise “general jurisdiction” over the actions of a foreign parent company based on the presence of a subsidiary in that forum. In DaimlerChrysler AG v. Bauman, No. 11-965, the U.S. Supreme Court will review an expansive holding from the Ninth Circuit. The Ninth Circuit held that DaimlerChrysler Aktiengesellschaft (DCAG)—a German company—is subject to general jurisdiction in California based on the actions of its subsidiary, Mercedes-Benz USA (MBUSA), in the state. The questions raised by the justices at oral argument suggest they are considering several lines of reasoning leading to the reversal of this holding.
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