Second Circuit Affirms Dismissal of Asbestos Defendant for Lack of Personal Jurisdiction
In its recent Brown decision, the 2nd Circuit Federal Court of Appeals upheld a dismissal of an asbestos defendant for lack of personal jurisdiction, holding that the defendant’s business operations in Connecticut, where the suit was filed, did not satisfy the minimum contacts required to establish general jurisdiction over the defendant. The plaintiff was unable to allege that any exposures actually occurred within Connecticut’s borders, thereby rendering specific jurisdiction inapplicable.
Generally speaking, personal jurisdiction refers to a given court’s ability to exercise authority over a potential defendant in the court’s jurisdiction. In order to establish personal jurisdiction over a defendant, a plaintiff must prove that the defendant either has general or specific contacts with the forum state. If general contacts are established, a potential defendant might be able to be sued in that jurisdiction. Conversely, establishing specific jurisdiction requires a plaintiff to prove that the suit arose out of actions by the defendant in the specific jurisdiction where suit was filed, usually in accordance with a state’s statutory scheme establishing jurisdiction over out-of-state defendants (more commonly known as “Long Arm Statutes”).
In upholding the dismissal, the court relied on the United States Supreme Court’s recent decision in Daimler AG v. Bauman, which requires that defendants be “essentially at home” in the state where suit is filed in order to satisfy general (as opposed to specific) jurisdiction. Further, the 2nd Circuit established the following points, which may prove useful to potential asbestos and other corporate defendants:
First, merely operating a business in a forum state is not sufficient to establish that a corporation is “essentially at home” under Daimler. Rather, a potential defendant must have sufficient continuous and systematic contacts by either (1) incorporating itself in the forum state or (2) by establishing its principal place of business or “nerve center” there.
Second, merely registering to do business in a forum state and appointing an agent for service of process therein does not establish that a potential defendant has consented to general jurisdiction and suit in the forum state.
Accordingly, corporate defendants who receive summonses and complaints could analyze whether such complaints allege general or specific jurisdiction over them. If general jurisdiction is alleged, the defendant would be able to compare the forum state with both the state where the defendant was incorporated and where it most likely maintains its principal place of business. If neither location includes the alleged forum state, then it might be possible for defendants to consider the propriety of the alleged jurisdiction under Daimler.
Click here to read the full opinion in Brown, which was decided on February 18, 2016.