Document Type

Article

Publication Date

1-1-2014

Rights

In Copyright

Abstract

In January 2014, the U.S. Supreme Court decided Daimler AG v. Bauman. The case was supposed to resolve a very important question that had divided courts for decades: when, for jurisdictional purposes, can the contacts of a subsidiary be imputed to its parent? The Supreme Court dodged this question. Instead, it answered a different, but equally important, question: under what circumstances is a corporation “at home” such that a state has general jurisdiction over it? The Court had introduced the “at home” language to the discourse on general jurisdiction a few years earlier in Goodyear Dunlop Tires Operations, S.A. v. Brown, when it held that a state has general jurisdiction over a corporation if its activities within the state are so continuous and systematic as to render the corporation essentially “at home” there. At the time, courts and commentators were not one-hundred percent clear on the meaning of the “at home” language. After Daimler, they will be.

Daimler reinforced the idea that the “at home” basis for general jurisdiction is intended to be exceptional. Ordinarily, a corporation is only “at home”—and therefore subject to general jurisdiction—in, at most, two places: its state of incorporation and its principal place of business. In making this pronouncement, the Supreme Court has done away with a very well established, albeit wholly under-theorized, basis for general jurisdiction: “doing business.” For the better part of a century, courts had assumed general jurisdiction over corporations on the basis that they were doing business in the forum, as evidenced by the corporation’s commercial presence in the state. This basis of jurisdiction was perceived as exorbitant by foreigners and often condemned as promoting forum shopping. Daimler officially sounds the death knell for doing business jurisdiction in the United States.

In this Article, I examine the decisions of the majority and the concurrence, highlighting the critical areas of disagreement. I lay out the key implications of Daimler: the end of doing business jurisdiction in the United States, the doctrinal pressure on alternative bases of jurisdiction to fill the void left by Daimler, and the real-world consequences for litigants and courts. I also look at the critical questions that Daimler left unanswered—in particular, the standard for imputation of jurisdictional contacts from a subsidiary to a parent and the propriety of imputation where the underlying basis of jurisdiction is that the subsidiary is incorporated in the state or has its principal place of business there. The implications of the Daimler decision will be felt by both plaintiffs and defendants for years to come. Accordingly, it warrants a careful look.

Publication Title

Hastings Law Journal

First Page

233

Last Page

293

Comments

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