U.S. Supreme Court rules in important jurisdiction case over whether federal courts have "general jurisdiction" over foreign companies with limited U.S. contracts
Does it violate due process for a court to exercise general personal jurisdiction over a foreign corporation based solely on the fact that an indirect corporate subsidiary performs services on behalf of the defendant in the forum state?
In its brief, the U.S. Chamber urged the Supreme Court to reverse the decision of the Ninth Circuit. The Chamber argued that the Due Process Clause does not permit the exercise of general jurisdiction over a paretn corporation, whether foreign or domestic, based on the in-forum contacts of its wholly owned subsidiary. In this case, the Ninth Circuit permitted plaintiffs to assert general jurisdiction over a foreign parent company based on the contacts of its indirectly held subsidiary in an attempt to hold that foreign parent accountable in United States court for the alleged conduct of an entirely different subsidiary that took place in a foreign country. In its brief, the Chamber argued that the decision should be reversed for two reasons. First, general jurisdiction is available only in forums where the defendant is "at home". Second, the Chamber argued that the Ninth Circuit's "agency" test is irreconcilable with the Supreme Court's prior decisions and the purposes underpinning the due process limits on adjudicatory jurisdiction.
The Court reversed the ruling of the Ninth Circuit and held that Daimler AG is not amenable to suit in California for injuries allegedly caused by conduct of MB Argentina that took place entirely outside the United States.
U.S. Chamber amicus brief in support of cert. filed 3/8/12. Cert. granted 4/22/13. U.S. Chamber amicus brief on the merits filed 7/5/13. Argued 10/15/13. Decided 1/14/14.