Let's Be Specific About Personal Jurisdiction: Missouri and Illinois Address Bristol-Myers Squibb v. Superior Court of CaliforniaJuly 27, 2020 | Jennifer Maloney and Julie Simaytis
The Supreme Courts of Missouri and Illinois have recently addressed the constitutional limitations on the exercise of specific personal jurisdiction. In both states, the Courts held that due process prohibits the exercise of specific personal jurisdiction over out-of-state defendants in cases where the defendant does not have sufficient minimum contacts with the forum state and in cases where the alleged injury does not arise from those contacts.
In State ex rel. LG Chem, Ltd. v. The Hon. Nancy Watkins Laughlin, 2020 Mo. LEXIS 193 (Mo. banc June 2, 2020), Plaintiff Peter Bishop brought suit against Defendant LG Chem, a Korean company, in St. Louis County Circuit Court. Bishop alleged he was injured when a lithium-ion battery manufactured by LG Chem exploded in his pocket. Bishop also alleged LG Chem sold the battery to an intermediate distributor, which independently sold the battery to a retailer of electronic cigarettes in Missouri from whom Bishop purchased the battery.
LG Chem moved for dismissal based on lack of personal jurisdiction. In opposing LG Chem’s motion, Bishop relied on Bristol-Myers Squibb Co. v. Superior Court of California, 137 S. Ct. 1773 (2017). In Bristol-Myers, the United States Supreme Court held that a state court could not exercise specific personal jurisdiction over an out-of-state defendant unless there was “an affiliation between the forum and the underlying controversy, principally…an occurrence that takes place in the forum state.” Id. at 1781. Bishop argued there was a sufficient “affiliation” between Missouri and the underlying controversy to justify the exercise of specific personal jurisdiction over LG Chem because the battery had made its way to Missouri through the third-party distributor and caused injury in Missouri. LG Chem’s motion to dismiss was denied. Ultimately, the Missouri Supreme Court found Bishop’s application of Bristol-Myers to be overbroad and held the actions of a third party, standing alone, cannot be used to satisfy the due process requirement of the specific personal jurisdiction analysis. Since the subject battery had been sold to the Missouri retailer by an independent third party, the Court directed the circuit court to vacate its order overruling LG Chem’s motion to dismiss for lack of personal jurisdiction.
Two days later, the Supreme Court of Illinois also issued an opinion addressing the exercise of personal jurisdiction over an out-of-state defendant, but unlike the Missouri case, the case involved claims brought by out-of-state plaintiffs. In Rios v. Bayer Corp., 2020 IL 125020 (June 4, 2020), the Court held that due process did not allow Illinois courts to exercise specific personal jurisdiction over an out-of-state defendant as to the claims of out-of-state plaintiffs for personal injuries suffered outside of the state from a device manufactured outside of the state. At issue were two cases, both filed in Madison County, Illinois, in which 180 women from more than twenty states alleged injuries related to the use of a permanent birth control device called Essure. The out-of-state plaintiffs had not had the Essure device prescribed or implanted in Illinois and had not sought treatment for their alleged injuries in Illinois. Bayer moved for dismissal of the out-of-state plaintiffs’ claims based on lack of personal jurisdiction. In response to Bayer’s motion, the out-of-state plaintiffs argued the trial court could exercise specific personal jurisdiction over Bayer for their claims because Bayer had developed, labeled, marketed and worked on gaining regulatory approval for Essure in Illinois, and the plaintiffs’ claims arose, in part, from those “minimum contacts” between Bayer and the State of Illinois.
While Bayer’s motion was pending in the trial court, the United States Supreme Court issued its opinion in Bristol-Myers. Despite the new guidance provided in Bristol-Myers, the trial court denied Bayer’s motion, relying on M.M. v. GlaxoSmithKline LLC, 2016 IL App (1st) 151909, wherein the Illinois Court of Appeals had found the exercise of personal jurisdiction over an out-of-state defendant did not violate the due process clause in product liability cases brought by out-of-state plaintiffs where clinical trials had been conducted in Illinois. Bayer appealed. The appellate court held the exercise of personal jurisdiction over Bayer by the trial court was constitutional because the out-of-state plaintiffs’ claims arose, at least in part, from Bayer’s marketing, clinical trials and physician accreditation programs related to Essure in Illinois.
Ultimately, the Illinois Supreme Court reversed the appellate and trial courts. The Court determined Bristol-Myers had foreclosed the plaintiffs’ theory of specific personal jurisdiction and concluded that the out-of-state plaintiffs’ claims did not arise out of Bayer’s activities in Illinois; therefore, due process did not allow the trial court’s exercise of specific personal jurisdiction over Bayer as to the out-of-state plaintiffs’ claims.
These cases represent the first application of the limitations on specific personal jurisdiction expressed in Bristol-Myers by each state’s Supreme Court. The conclusion reached by both Courts emphasizes the importance of conducting a comprehensive evaluation of a defendant’s contacts with the forum state immediately upon service of the summons in every instance.
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In Bryant v. Compass Grp. USA, Inc., 958 F.3d 617 (7th Cir. 2020), the federal court of appeals for the Seventh Circuit answered in the affirmative the question of whether, for federal-court purposes, a person aggrieved by a violation of Illinois’ Biometric Information Privacy Act (BIPA) has suffered the kind of injury-in-fact that supports Article III standing.
Plaintiff Christine Bryant’s workplace installed “Smart Market” vending machines owned and operated by the defendant Compass Group U.S.A., Inc. Rather than accept cash, users had to establish an account using a fingerprint. During orientation, plaintiff’s employer instructed her and others to scan their fingerprints into the Smart Market system to establish a payment link to create user accounts. In violation of section 15(a) of BIPA, Compass never made publicly available a retention schedule and guidelines for permanently destroying the biometric identifiers and information it was collecting and storing. In addition, in violation of section 15(b) of BIPA, Compass (1) never informed Bryant in writing that her biometric identifier was being collected or stored, (2) never informed Bryant in writing of the specific purpose and length of time for which her fingerprint was being collected, stored, and used, and (3) never obtained Bryant’s written release to collect, store, and use her fingerprint. Plaintiff asserted that Compass’s failure to make the requisite disclosures denied her the ability to give informed written consent as required by BIPA, leading to the loss of the right to control her biometric identifiers and information. Seeking redress for this alleged invasion of her personal data, Bryant brought a putative class action against Compass pursuant to BIPA’s provision providing a private right of action in state court to persons “aggrieved” by a violation of the statue.
Compass removed the case to federal court on the basis of diversity of citizenship. Plaintiff Bryant moved to remand to state court, claiming that the federal district court did not have subject-matter jurisdiction because she lacked the concrete injury-in-fact necessary to satisfy the federal requirement for Article III standing. The district court agreed with plaintiff and remanded to the state court.
On appeal, the Seventh Circuit noted that for Bryant to have Article III standing, she must satisfy three requirements: (1) she must have suffered an actual or imminent, concrete and particularized injury-in-fact; (2) there must be a causal connection between her injury and the conduct complained of; and (3) there must be a likelihood that this injury will be redressed by a favorable decision. Only the first of these requirements was at issue in the case in that the second and third requirements were clearly satisfied.
The appellate court ultimately concluded that Bryant has Article III standing as to her action for violations of section 15(b), but not for violations of section 15(a). Compass’s failure to abide by the requirements of section 15(b) before it collected users’ fingerprints denied Bryant and others like her the opportunity to consider whether the terms of that collection and usage were acceptable given the attendant risks. Going beyond a failure to satisfy a purely procedural requirement, Compass withheld substantive information to which Bryant was entitled and thereby deprived her of the ability to give informed consent as mandated by section 15(b). The appellate court found this deprivation is a concrete injury-in-fact that is particularized to Bryant and others like her, thereby meeting the Article III requirement for standing.
In contrast, the section 15(a) claim involves a duty owed to the public generally: the duty to make publicly available a data retention schedule and guidelines for permanently destroying collected biometric identifiers and information. This provision is not part of the informed consent regime of the statute, and Bryant alleges no particularized harm to herself or others that resulted from the alleged violation of section 15(a). Thus, she lacks standing to pursue that claim in federal court.This opinion finally answers the BIPA standing question but does so differently than many federal district courts that have remanded BIPA suits as alleging mere procedural violations without concrete, particularized harm. While this ruling is in line with the Ninth Circuit’s ruling in Patel v. Facebook, Inc., which we reported on here, it is at odds with other rulings, including one from the Second Circuit. This may open the door for U.S. Supreme Court review as it potentially affects a large number of lawsuit across the country.
Illinois Supreme Court Ruling Emphasizes Necessity of Post-Trial Motion in the Preservation of Trial Court ErrorJune 18, 2020 | Lisa Larkin
In Crim v. Dietrich, 2020 IL 124318, the Illinois Supreme Court found that in a health care liability case, the lower appellate court’s mandate remanding the case for a new trial did not include a new trial on the professional negligence claim. The plaintiffs, who filed both a professional negligence claim and a claim alleging failure to obtain informed consent, failed to file a post-trial motion after a jury verdict on the professional negligence claim. While the lower appellate court issued just a general mandate for a new trial and the appellate court later clarified that it intended that mandate to allow for a retrial of both claims, the Supreme Court held the plaintiffs forfeited their right to a retrial on the professional negligence claim. In other words, the mandate could not have included a mandate for a new trial on the professional negligence claim because the right to appeal that claim had already been lost by failure to file a post-trial motion.
The Crims, acting on behalf of their biological son, filed a medical malpractice claim against defendant Dr. Gina Dietrich alleging two claims: (1) that she failed to obtain Mrs. Crim’s informed consent to perform a natural birth despite possible risks associated with her son’s large size; and (2) that defendant negligently delivered the baby, causing him injuries. The trial court granted defendant’s motion for directed verdict on the issue of informed consent on the basis that the plaintiffs needed, but lacked, expert testimony that a reasonable patient would have pursued a different form of treatment. Thereafter, following additional evidence, the jury returned a verdict in defendant’s favor and against plaintiffs on their remaining claim of professional negligence. The plaintiffs did not file any post-trial motions, and instead filed a timely notice of appeal.
In their brief before the Appellate Court for the 4th District, the plaintiffs framed their appeal as a review only on whether the circuit court erred in issuing a directed verdict on the informed consent claim, expressly stating that their appeal is not based upon the verdict of the jury. The 4th District ruled that the trial judge incorrectly issued the directed verdict and granted a new trial. The appellate court entered a general mandate reversing and remanding to the circuit court for such other proceedings as required by the order of the appellate court.
Plaintiffs claimed that this general mandate of remand and retrial entitled them to a new trial on not only the informed consent claim, but also on the professional negligence claim. According to plaintiffs, they should be allowed to retry both claims because the claims were intertwined, and the trial court tainted the rest of their case when it erroneously granted defendant a directed judgment.
The Illinois Supreme Court, however, disagreed, stating that “the trouble with [plaintiff’s] argument is the simple fact that they never filed a post-trial motion pursuant to section 2-1202.” Section 2-1202 of the state Code of Civil Procedure requires litigants to challenge a jury’s verdict with post-trial motions even when the trial court enters a partial directed verdict as to other issues in the case. “The failure by plaintiffs to file a post-trial motion challenging the jury’s verdict deprived the circuit court of an opportunity to correct any trial court errors involving the jury’s verdict and undermined any notion of fairness to defendant on appeal.”
Notably, this Supreme Court ruling came after the appellate court answered a certified question by saying it had intended the plaintiffs’ negligence claims to be retried when it reversed and remanded the trial court’s directed judgment.
In a dissenting opinion, Justice Thomas Kilbride wrote that the majority’s holding confuses a party’s forfeiture of an argument with a reviewing court’s power to grant relief. He also felt that the Court should not have entertained the appeal at all because it was too case-specific and not “of general importance.”
The case emphasizes the importance of post-trial motions in preservation of error for purposes of appeal. Prudent practitioners should raise in post-trial motions all issues which might be the basis for arguments of trial court error later.
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