The Supreme Court is at it again, sacrificing the rights of plaintiffs for the benefit of the almighty corporation. In its latest turn of the knife, the nation’s highest court has limited the locations where injured personal injury victims may sue corporations. This week the Court decided BNSF Railway v. Tyrrell. The plaintiffs sued BNSF in Montana for claims that occurred outside of the state. The basis for jurisdiction in Montana was that the railroad had more than 2,000 miles of track and 2,000 employees in the state. The Montana Supreme Court found these facts to be sufficient contacts with the state to invoke jurisdiction.
The U.S. Supreme Court said “no” in an 8-1 decision. Rather, it ruled that a corporation cannot be held liable for claims that are unrelated to any activity occurring in the state. State courts may not hear claims by injured parties against companies when they are not based or headquartered in the state or the alleged injuries did not occur there.
This may sound logical at first, until you consider the global economy in which we live. We travel and every day we encounter multi-state and multi-national corporations and their products and services. So, if you’re visiting a neighboring state like Wisconsin and you’re injured using a defective product manufactured by a multinational company like Yamaha but they’re headquartered in New York, you may not be able to sue them in Illinois even though this is where you live and Yamaha does significant business in Illinois.
Under this scenario, the plaintiff is not seeking to sue Yamaha in Illinois because Illinois has laws more favorable to plaintiffs, a strategy we call “forum shopping” and something courts seek to protect against, the victim just doesn’t want to have to travel to Wisconsin to prosecute the case, such as meeting with an attorney, taking depositions and even sitting for trial.
The only dissenting Justice, Sonia Sotomayor, got it right calling it a “jurisdictional windfall” for large multistate and multinational corporations. “It is individual plaintiffs, harmed by the actions of a far-flung foreign corporation, who will bear the brunt of the majority’s approach and be forced to sue in distant jurisdictions with which they have no contacts or connection.” The ultimate irony here is that corporate defendants are the ones that are equipped for and can afford the interstate nature of litigation. Even worse, the overriding effect of this decision will be that less lawsuits are filed as personal injury victims simply can’t afford or don’t have the will to pursue their claims across state lines with such obstacles impeding their access to recovery.