Judge Holds that Courts Can Exercise Jurisdiction Over Out-of-State Class Members
A federal judge in the Western District of Washington recently held that federal courts can exercise personal jurisdiction over out-of-state members of a class action arising under federal law. The judge declined to extend the U.S. Supreme Court’s holding in Bristol-Myers Squibb Co. v. Superior Court of Cal., 582 U.S. 255 (2017), which limits the jurisdiction of state courts in mass tort actions.
A plaintiff brought TCPA claims against a corporation on behalf of two nationwide classes, which were both certified. The plaintiff was a resident of Washington, and the corporation was incorporated in Delaware and had a principal place of business in Minnesota. The corporation filed a motion to dismiss out-of-state class members for lack of personal jurisdiction, citing to Bristol-Myers. In that case, the Supreme Court had held that in mass tort actions arising under state law and pending before state courts, each plaintiff was required to demonstrate specific jurisdiction over a defendant who is not subject to general jurisdiction in that state.
The judge denied the corporation’s motion holding that Bristol-Myers did not apply to class actions pending in federal courts. The judge rejected the corporation’s argument that multi-plaintiff, mass, and class actions were the same for purposes of personal jurisdiction. The judge found that unlike in the other actions where each plaintiff was a real party-in-interest, only the class representative was the real party-in-interest in a class action. Additionally, the judge found that the additional due process requirements for class actions, such as claim commonality, claim typicality, and adequacy of representations, ensured that a court’s exercise of jurisdiction over absent class members was fair. For these similar reasons, the judge also held that class actions did not violate the Rules Enabling Act, which prohibits the abridgement of substantive due process rights.
The judge also rejected the corporation’s argument that it had a due process right to challenge the exercise of personal jurisdiction over absent class members. While the corporation had cited to the Supreme Court’s holding in Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985), the judge found that Shutts was silent on the issue of due process rights of class action defendants. In Shutts, the Supreme Court had held that state courts could exercise personal jurisdiction over absent class members because their due process rights were adequately protected by procedural safeguards, such as opt-out notices. The judge also held that absent class members were not required to establish subject matter jurisdiction.
