First Circuit Addresses Bristol-Myers' Impact On Nationwide Actions Brought In Federal Court

• Published date: 21 April 2022
• Subject Matter: Litigation, Mediation & Arbitration, Class Actions, Trials & Appeals & Compensation
• Law Firm: Cahill Gordon & Reindel LLP
• Author: Mr Joel Kurtzberg, Adam S. Mintz and Samuel Weiner

In 2017, the Supreme Court of the United States held in Bristol-Myers Co. v. Superior Court¹ that the Due Process Clause of the U.S. Constitution requires all plaintiffs in a mass-tort action to demonstrate that the court has personal jurisdiction over their claims.² The ruling significantly limited the locations in which plaintiffs could bring mass-tort cases, and since Bristol-Myers, courts have grappled with whether due process limits the locations in which class actions and other types of multi-party cases can be asserted.

On January 13, 2022, in Waters v. Day & Zimmerman NPS, Inc.,³ the United States Court of Appeals for the First Circuit addressed whether due process requires each plaintiff in a collective action brought under the Fair Labor Standards Act ("FLSA") to establish jurisdiction over each defendant. The First Circuit disagreed with previous decisions from the United States Courts of Appeals for the Sixth and Eighth Circuits that held that each plaintiff who opts into the case need not establish personal jurisdiction over their claims. The decision creates a circuit split that may eventually require resolution by the Supreme Court. In the meantime, the decision will likely encourage plaintiffs to bring multi-party actions in those jurisdictions that have adopted more expansive views of jurisdiction.

I. Background

In Bristol-Myers, California residents and non-residents filed complaints in California state court against Bristol-Myers, a New York-based pharmaceutical company incorporated in Delaware, alleging injury caused by one of company's medications. The suit did not allege that the non-California plaintiffs obtained the medication in California, were injured in California, or received treatment for injury in California. Instead, plaintiffs targeted California on the theory that the California court could establish specific jurisdiction over the non-California claims based on the company's significant contacts in the state, including its extensive marketing and retail practices there.

On appeal, the Supreme Court held that the Fourteenth Amendment's Due Process Clause places limits on non-residents of the forum state who cannot demonstrate a connection to the forum and the claims they assert. The Court rejected the non-resident plaintiffs' attempt to establish jurisdiction over Bristol-Myers in California, finding that California state courts lacked specific jurisdiction over the non-residents' claims.⁴ Further, the Court held that those California residents who could demonstrate jurisdiction over their claims were unable to extend their jurisdiction to the claims of the non-resident plaintiffs.⁵

The Supreme Court left unanswered how courts should apply its ruling in different types of multi-party cases. In Bristol-Myers, the Court addressed mass actions ' cases in which a...