No In-State Dealings For Years? No Jurisdiction

We previously analyzed the U.S. Supreme Court’s decision in Daimler A.G. v. Bauman and its effects on California personal jurisdiction law. We have been following the progress of courts applying this significant decision. Federal courts have now begun applying Bauman in the context of asbestos personal injury lawsuits, many hundreds of which are filed in state and federal courts each year in California alone.

The potentially far reaching impact of Bauman is demonstrated by the recent order of Judge Barry Ted Moskowitz of the United States District Court, Southern District of California.  The moving papers argued that there was a lack of personal jurisdiction over the defendant, a pump manufacturer defendant in a mesothelioma case, and the court agreed.  The defendant pump manufacturer had apparently sold pumps to a contractor for installation on Navy ships at shipyards in CA.  Admittedly the order of Judge Moskowitz relies upon the specific facts of the case, but the court’s analysis suggests that similar results may be found in favor of other defendants.

The court explained that there are two types of personal jurisdiction: general and specific.  Specific jurisdiction arises when the defendant’s contacts with the forum state gave rise to the suit.  Here, the plaintiffs did not claim that specific jurisdiction existed.   One could postulate specific jurisdiction, for example, in a case in which the pump was worked upon in the forum state, but apparently such facts did not exist in this case.

The court then moved to an assessment of general jurisdiction.  The court found that the evidence presented did not demonstrate that the defendant was “essentially at home” in California so as to establish general jurisdiction.  The court considered “all of the defendant’s contacts with the forum state over a period of years prior to the filing of the complaint,” commenting that typically courts have examined “a defendant’s contacts with the forum state over a period of three to seven years prior to the filing of the complaint.”

As in all asbestos cases, the exposure in question occurred decades ago, and in later years the contacts which the defendant in question had with California dwindled to nothing.  Indeed the evidence showed that the defendant had only one transaction in the state of California after 1986.

Not every defendant will be able to demonstrate such minimal contacts with the forum state as applicable in the instant case.  But how much contact will be necessary to show that a defendant is “essentially at home” in the forum state?  It would seem that many defendants may be in a position to argue that they are not.  No doubt other defendants will be testing the limits of this new standard for general personal jurisdiction whenever they sued in a forum other than the place where the alleged tortious conduct occurred.  We look forward to following the progress of such cases.