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August 30, 2018 by Kyle A. ShambergDownload PDF


Jurisdictionally or Via Rule 23: When are Multi-State Class Actions Appropriate Under Bristol-Myers Squibb?Kyle A. Shamberg

In Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017), the Supreme Court reaffirmed the principle that “[a] corporation’s continuous activity of some sorts within a state ... is not enough to support the demand that the corporation be amenable to suits unrelated to that activity.” In reaching this conclusion, the Supreme Court employed a “straightforward application ... of settled principles of personal jurisdiction” in which specific jurisdiction over a claim can only be exercised if there is an “affiliation between the forum and the underlying controversy, principally, an activity or an occurrence that takes place in the forum State.”

While BMS was a mass tort case brought by consumers alleging injuries from using Plavix, a prescription drug that thins blood and inhibits blood clotting, its repercussions in the field of class actions have been far-reaching. Where is the appropriate forum to bring a multi-state or nationwide class action against a corporate defendant? What classes of individuals can a plaintiff represent? And, perhaps most importantly, how do the jurisdictional principles developed over centuries of jurisprudence, and reaffirmed in BMS, intersect with the requirements of Rule 23?

Two federal courts in Chicago who tackled this questions have reached starkly different results. First, in DeBernardis v. NBTY, Inc., 2018 WL 461228 (N.D. Ill. Jan. 18, 2018), Judge Harry Leinenweber noted that the high court’s ruling in BMS has been used to block nationwide class actions in a court, such as his, that doesn’t have general jurisdiction over a particular defendant.

In DeBernardis, a case alleging consumer fraud in the marketing of a dietary supplement, the Plaintiff, an Illinois resident, brought claims on behalf of a class consisting of both in-state and out-of-state residents. Because NBTY was not an Illinois company (and therefore the court did not have general jurisdiction over it), Judge Leinenweber ruled that, under BMS, the court could not assert jurisdiction over the claims of out-of-state residents, who did not purchase the product in Illinois, against a defendant that was neither incorporated nor maintained a principal place of business in Illinois. Accordingly, Judge Leinenweber dismissed the claims of all out-of-state class members, concluding that “it is more likely than not based on the Supreme Court’s comments about federalism that the courts will apply BMS to outlaw nationwide class actions . . . where there is no general jurisdiction over the Defendants.”

This ruling begs the question: is a class action plaintiff’s ability to represent consumer from other states a question of jurisdiction or a question of typicality, commonality, and predominance under Rule 23? In other words, if a court has only specific jurisdiction over a class plaintiff’s claim, should that plaintiff be precluded from pursuing a multi-state class action on jurisdictional grounds even if he or she would otherwise be a proper class representative. Is it really a question of jurisdiction or class certification?

While Judge Leinenweber took the former view, another Judge in his District has approached the question differently. In Haj v. Pfizer Inc., No. 17 C 6730, 2018 WL 3707561 (N.D. Ill. Aug. 3, 2018), Judge Gary Feinerman ruled in favor of the plaintiff, who accused Pfizer Inc. of deceptively charging more for maximum strength Robitussin cough syrup than the regular product, holding that Pfizer could not avoid having the issue tried in Chicago just because some potential class members were not Illinois residents.

Before BMS, Judge Feinerman explained, “due process neither precluded nationwide or multistate class actions nor required the absent-class-member-by-absent-class-member jurisdictional inquiry urged by Pfizer. Bristol-Myers does not alter that landscape,” noting it was a mass action, not a class action. Accepting Pfizer’s position in this instance, Feinerman added, would prompt an “extraordinary sea change in class action practice,” saying Pfizer’s position boils down to an argument that “absent class members are not parties for purposes of diversity of citizenship, amount in controversy, Article III standing and venue, [but] they are parties for purposes of personal jurisdiction over the defendant.”

“That cannot be right,” Judge Feinerman continued. “Personal jurisdiction shares a key feature with those other doctrines: each governs a court’s ability, constitutional or statutory, to adjudicate a particular person’s or entity’s claim against a particular defendant.”

Judge Feinerman therefore concluded that the determination as to whether Haj could represent a class consisting of out-of-state residents was more appropriately made at class certification, rather than as a matter of jurisdiction.

This author tends to find Judge Feinerman’s approach more palatable and in line with the history and purpose of Rule 23. When there is unquestionably jurisdiction over the named parties in the suit, the interests of judicial economy and fairness militate in favor of considering the propriety of a defined class based on the relevant Rule 23 factors, as had been the case long before BMS. When a plaintiff seeks to certify a multi-state class, concerns about variations in the law or other individualized inquiries may ultimately lead to certification being denied. But, as Judge Feinerman noted, there is no jurisprudential basis to slash these cases from the outset on jurisdictional grounds. One hopes that this line of reasoning ultimately wins the day.