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Supreme Court rules California courts lack jurisidction in pharmaceutical mass action case

[JURIST] The US Supreme Court [official website] held [opinion, PDF] on Monday that California courts lack specific jurisdiction to hear the claims brought against Bristol-Myers Squibb Co. (BMS) [corporate website]. BMS manufactures and sells Plavix, a prescription drug that prevents blood clots by thinning the blood. Nearly 700 plaintiffs, only 86 of whom are California residents, filed eight separate complaints in California Superior Court [official website] asserting that the drug had damaged their health. The court looked to "settled principles" to reach its decision, stating, "In order for a court to exercise specific jurisdiction over a claim, there must be an affiliation between the forum and the underlying controversy, principally, an activity or an occurrence that takes place in the forum State." BMS is incorporated in Delaware and headquartered in New York and maintains large operations in New York and New Jersey. While BMS does engage in business activities in other jurisdictions, including California, "BMS did not develop Plavix in California, did not create a marketing strategy for Plavix in California, and did not manufacture, label, package, or work on the regulatory approval of the product in California." The amount of the drug sold in California amounts to a little over one percent of the company's total national sales. The plaintiffs contended that because BMS contracted with a California advertising company provides a basis for specific jurisdiction but the court stated that the fact "that BMS contracted with a California distributor is not enough to establish personal jurisdiction in the State." Justice Sonia Sotomayor filed a dissenting opinion:

I fear the consequences of the Court's decision today will be substantial. The majority's rule will make it difficult to aggregate the claims of plaintiffs across the country whose claims may be worth little alone. It will make it impossible to bring a nationwide mass action in state court against defendants who are "at home" in different States. And it will result in piecemeal litigation and the bifurcation of claims. None of this is necessary. A core concern in this Court's personal jurisdiction cases is fairness. And there is nothing unfair about subjecting a massive corporation to suit in a State for a nationwide course of conduct that injures both forum residents and nonresidents alike.
The Supreme Court granted certiorari in Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County [SCOTUSBlog materials] in January and heard arguments [JURIST reports] in April.

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