Trial News

The Seventh Circuit has held that the U.S. Supreme Court’s personal jurisdiction ruling in Bristol-Myers Squibb Co. v. Superior Court does not apply to class actions. The court held that the procedures outlined in Federal Rule of Civil Procedure 23 govern class actions, and it highlighted the differences between class actions and other types of coordinated or consolidated mass actions. It also reiterated longstanding principles for determining personal jurisdiction in class actions, specifically that it is the named plaintiffs who are relevant to jurisdiction questions, not absent class members. (Mussat v. IQVIA, Inc., 2020 WL 1161166 (7th Cir. Mar. 11, 2020).)

Florence Mussat received two unsolicited faxes from the defendant, IQVIA, Inc., that did not include the statutorily required opt-out notice. She brought a putative class action in the Northern District of Illinois against the defendant for violations of the Telephone Consumer Protection Act. IQVIA, a Delaware corporation with its headquarters in Pennsylvania, moved to strike the class on the ground that the district court did not have personal jurisdiction over the non-Illinois members of the proposed nationwide class.

Citing Bristol-Myers (137 S. Ct. 1773 (2017)), the district court granted the motion. It reasoned that because it did not have general jurisdiction over the defendant, the named plaintiff and the unnamed members of the class each had to demonstrate “minimum contacts between the defendant and the forum state” for the court to exercise specific jurisdiction. The district court held that it did not have specific jurisdiction over the claims of plaintiffs harmed outside Illinois.

Mussat appealed to the Seventh Circuit under Federal Rule of Civil Procedure 23(f), and the appellate court rejected the district court’s reading of Bristol-Myers, concluding that the opinion does not encompass class actions. AAJ filed an amicus brief in support of the plaintiff.

The Seventh Circuit explained that the longstanding interpretation of due process meant that plaintiffs could pursue nationwide class action claims in federal court even when that federal court did not have general jurisdiction over the defendant. When a federal court must rely on specific jurisdiction, the minimum contacts test and other considerations apply only to the named plaintiff in a class action. “Even if the links between the defendant and an out-of-state named class member were confined to that person’s home state, that did not destroy personal jurisdiction,” the court noted. It further emphasized that “once certified, the class as a whole is the litigating entity . . . and its affiliation with a forum depends only on the named plaintiffs.”

Federal class actions have several features that distinguish them from the type of action at issue in Bristol-Myers, which involved hundreds of plaintiffs—many of whom were not California residents—in a coordinated mass action filed in California state court asserting state law claims. The coordinated mass action is similar to federal multidistrict litigation, but it is not analogous to class actions, the court explained, and extending Bristol-Myers to class actions would essentially render nationwide class actions “impossible any time the defendant is not subject to general jurisdiction.”

In contrast to mass actions, class actions are explicitly governed by Rule 23, and absent class members are not considered parties to the action for several jurisdiction questions, including diversity, the amount in controversy, and venue. It is the named plaintiffs who are relevant to deciding these jurisdiction questions. The court emphasized that there is “no reason why personal jurisdiction should be treated any differently from subject-matter jurisdiction and venue: the named representatives must be able to demonstrate either general or specific personal jurisdiction, but the unnamed class members are not required to do so.”

The court also rejected the defendant’s argument that allowing personal jurisdiction for nonresident unnamed class members would be inconsistent with Federal Rule of Civil Procedure 4(k) on service of process. The defendant argued that because Illinois law would prevent some absent class members from suing it in Illinois, then Rule 4(k) prohibits the district court from exercising jurisdiction. But the defendant “mix[ed] up the concepts of service and jurisdiction. Rule 4(k) addresses how and where to serve process; it does not specify on whom process must be served. . . . [I]f the court has personal jurisdiction over the defendant with respect to the class representative’s claim, the case may proceed. Nothing in the Federal Rules governing service of process contradicts this.”

The Seventh Circuit concluded that the defendant “urges a major change in the law of personal jurisdiction and class actions. This change is not warranted by the Supreme Court’s decision in Bristol-Myers.”

AAJ Senior Associate General Counsel Jeffrey White said, “The Seventh Circuit here drew a clear line against the irresponsible overreaching by the defendant and the district court in this case. In Bristol-Myers, the Supreme Court placed unfair restrictions on plaintiffs. But corporate defendants around the country have tried to stretch that decision beyond anything the Supreme Court had in mind. In particular, the Seventh Circuit reaffirmed the longstanding principle only the named plaintiffs in class actions are required to establish personal jurisdiction. To abandon that principle would close the courthouse doors to many Americans who have been wrongfully injured but cannot feasibly bring individual lawsuits against the corporate wrongdoer.”

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