U.S. Supreme Court Decision Restricts Non-resident Plaintiffs Seeking to Join State Court Lawsuits

Many citizens only hear of decisions made by the U.S. Supreme Court if that decision is considered “newsworthy” by the national media. This lack of coverage will often cause a significant ruling to go unnoticed. This appears to have happened in a recent (June 19, 2016) ruling that denies out-of-state plaintiffs the standing to participate in state court lawsuits.

A summary of the case,Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County, is as follows:

Bristol-Myers Squib (BMS) manufactures the drug Plavix, which is used by those who have suffered strokes, heart attacks, or health problems related to poor arterial circulation. A group of California residents filed a product liability suit against BMS in a California court seeking damages for alleged injuries related to taking the drug on a regular basis. The California court, citing its “general jurisdiction” over the Plavix lawsuit in California, allowed several hundred residents of other states who claimed to have suffered injuries similar to those suffered by the California plaintiffs to be added as plaintiffs to the California lawsuit. BMS appealed the California court’s ruling to the 9th Circuit Court of Appeals, which ruled in favor of the out-of-state plaintiffs. BMS appealed to the Supreme Court, which reversed (by a vote of 8-1) the 9th Circuit’s ruling and thus disallowed the inclusion of out-of-state plaintiffs in the California state court lawsuit.

In writing the majority decision, Justice Samuel Alito described the Court’s reasoning in the case by noting that:

• Although BMS had extensively marketed Plavix in California, the drug was not manufactured in California nor was the company headquartered in California.
• The nonresident plaintiffs in the California lawsuit had not been prescribed Plavix in California.
• The nonresident plaintiffs did not purchase Plavix in California.
• The nonresident plaintiffs did not ingest Plavix in California.
• The nonresident plaintiffs did not suffer their alleged injuries in California, nor did they seek treatment in California.

Therefore, the court ruled, the nonresident plaintiffs had no legal standing in the California lawsuit and the California court had thus erred in allowing the nonresidents to join the lawsuit.

How will the decision affect consumers’ product liability lawsuits?

Despite the claims of some Internet pundits, the decision in this case does nothing to restrict the ability of consumers to file a lawsuit alleging a specific injury was caused by a defective product. It does, however, reaffirm the Supreme Court’s previous rulings in cases such asDaimler AG v. Bauman andBNSF Railway Co. v. Tyrrell, both of which limit the jurisdiction of state courts to those cases in which the alleged injuries or corporate malfeasance occurred within the boundaries of a state.

Consumers still have several options available when it comes to lawsuits alleging injury due to defective products such as medications, automobile components, or any product manufactured at a location distant to where it was sold or used.

• Class Action Lawsuit

In a class action lawsuit, many plaintiffs from multiple locations who have suffered the same injury from the same product are “joined” into a single “class” that is represented by a “lead” plaintiff who represents the entire class before a court. The principle advantage of joining a class action lawsuit is that the lead plaintiff bears the costs of the lawsuit while the other plaintiffs get, essentially, a “free ride”: if the lawsuit is successful, they are entitled to a share of the damages awarded without having to bear any of the legal expenses.

On the other side of the equation, the bulk of any settlement in a class action lawsuit goes to the lead plaintiff and attorney fees will consume a sizeable portion of whatever remains of the damages awarded, leaving relatively little for the class members. Most personal injury lawyers will recommend that their clients avoid participating in class actions because such participation will prevent their clients from pursuing their own claims against the same defendant.

• Multi-jurisdiction Litigation

In instances where a product is alleged to have caused injuries of different severity to plaintiffs living in separate locations, a personal injury lawyer may ask a court to have a lawsuit declared as multi-district litigation. If such a request is granted, the evidence presented in a particular case can be cited in other lawsuits and the only issue to be decided in subsequent lawsuits is the amount of damages to be awarded to the other plaintiffs.

Multi-jurisdiction litigation has the advantage of having one case decide all issues of fact rather than having each plaintiff present the same evidence over and over again, but in different courts. This allows each plaintiff to collect damages that are in keeping with the extent of the individual plaintiff’s injuries and other losses. If, however, the initial lawsuit results in a ruling in favor of the defendant, the success of all other cases is jeopardized.

As in any personal injury case, the advice of an experienced personal injury lawyer should be sought and his or her recommendations given careful consideration by those considering product liability lawsuits that involve multiple jurisdiction issues.