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Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County

Supreme Court of California · 2017 · Civil Procedure

Civil ProcedureConstitutional LawPropertyPersonal JurisdictionGeneral JurisdictionSpecific JurisdictionDue Processpersonal jurisdiction

Facts

BMS manufactured and marketed Plavix, and 86 California residents plus 592 nonresidents sued BMS and McKesson in California, alleging injuries from ingesting the drug. BMS was incorporated in Delaware, headquartered in New York City, and maintained substantial operations in New Jersey; it did not manufacture Plavix in California, and work on Plavix's labeling, packaging, regulatory approval, advertising, and marketing strategy was not performed by its California employees. Still, BMS maintained substantial California operations, including research and laboratory facilities, approximately 164 employees in those facilities, about 250 sales representatives, a Sacramento office, extensive marketing and distribution activities, and nearly $918 million in Plavix sales in California from 2006 to 2012. The nonresident plaintiffs did not allege they were injured or treated in California, but all plaintiffs alleged the same defective-product and misleading-marketing course of conduct regarding Plavix.

Issue

May California courts exercise personal jurisdiction over BMS for the claims of nonresident plaintiffs who allegedly used and were injured by Plavix outside California? More specifically, are BMS's California contacts sufficient for either general jurisdiction or specific jurisdiction consistent with due process?

Rule

Under Code of Civil Procedure section 410.10, California may exercise jurisdiction to the full extent permitted by due process. General jurisdiction over a corporation exists only when its affiliations with the forum are so continuous and systematic as to render it essentially at home there. Specific jurisdiction requires (1) purposeful availment or direction toward the forum, (2) claims that arise out of or are related to those forum contacts, measured in California by the substantial connection test under which the intensity of forum contacts and the closeness of the connection are inversely related, and (3) a showing that jurisdiction is reasonable and consistent with traditional notions of fair play and substantial justice.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Northstar Therapeutics is incorporated in Delaware and headquartered in New York. It employs 520 people in California, maintains two research labs in San Diego, and earns 8% of its nationwide revenue from California sales, but most of its workforce and core operations are in New Jersey and New York. A Nevada plaintiff sues in California on a claim entirely unrelated to California activities.

Is a California court most likely to have general personal jurisdiction over Northstar Therapeutics?

Explanation. General jurisdiction exists only where the corporation is essentially at home, ordinarily its place of incorporation or principal place of business, absent an exceptional case. Comparing the corporation’s California activities to its activities nationwide, California is not its surrogate headquarters here. Plaintiff residence is not the reason general jurisdiction fails; the failure is that the defendant is not at home in California.