ALF Urges Supreme Court To Reject “Conspiracy Jurisdiction”
In BASF Metals Limited v. KPFF Investment, Inc., No. 23-232, two overseas corporate defendants in antitrust litigation involving market prices for platinum and palladium have filed a certiorari petition challenging a Second Circuit decision upholding a New York federal district court’s exercise of “conspiracy jurisdiction.” ALF has filed an amicus brief urging the Supreme Court to grant the petition and hold that conspiracy jurisdiction violates due process of law.
Whether due process permits a court to exercise specific personal jurisdiction over a defendant based on the forum contacts of an alleged co-conspirator, even when the defendant did not direct, control, or supervise the activities of that alleged co-conspirator.
Additional Background:
The case involves the ability of federal district courts to exercise “personal jurisdiction” (as distinct from subject-matter jurisdiction) over corporate defendants in civil litigation alleging an antitrust or other conspiracy.
In International Shoe Co. v. Washington, 326 U.S. 310 (1945), the Supreme Court held that to ensure due process of law, a court can exercise personal jurisdiction over a corporate defendant only if it has sufficient “minimum contacts” with the forum State (i.e., the State where a suit is filed) so that maintenance of the suit “does not offend traditional notions of fair play and substantial justice.” The Supreme Court’s “minimum contacts” case law in light of International Shoe has established two categories of personal jurisdiction: (i) “general” or “all-purpose” jurisdiction to hear any and all claims against a corporation in the States where it is “at home” (i.e., where it is incorporated and/or has its principal place of business), and (ii) “specific” or “case-linked” jurisdiction to hear only those cases where a corporate defendant, although not “at home” in the forum State, nonetheless has sufficient relevant contacts with the State.
So-called “conspiracy jurisdiction” enables a court to exercise specific jurisdiction over a group of alleged co-conspirators in civil litigation by imputing the forum contacts of one of the alleged co-conspirators to all of the alleged co-conspirators. There is a split of authority among federal and state courts as to whether exercise of such conspiracy jurisdiction violates defendant corporations’ due process rights.
ALF’s Amicus Brief:
ALF’s amicus brief argues that expansive jurisdictional theories such as “conspiracy jurisdiction” cannot be reconciled with the due process principles established by the Supreme Court’s case law on specific personal jurisdiction over corporate defendants. For example, conspiracy jurisdiction promotes “forum shopping” by enabling antitrust plaintiffs to hale alleged, far-flung co-conspirators into a presumably plaintiff-friendly forum solely on the basis of one of the alleged co-conspirator’s contacts with the forum State.
ALF’s brief urges the Court to reinforce the due process principles underlying its jurisprudence on specific jurisdiction by flatly rejecting conspiracy jurisdiction as unconstitutional where, as in most cases, there is no agency relationship between co-conspirators.
The amicus brief argues that immediate Supreme Court review is especially important in the wake of the Court’s recent decision in Mallory v. Norfolk Southern Railway Co., 143 S. Ct. 2028 (2023). By extending general jurisdiction to nonresident corporate defendants that merely have registered to do business in a State that has enacted a consent-to-jurisdiction-by-registration statute, Mallory raises important questions about the continuing role of specific personal jurisdiction in civil litigation against corporations.
Status:
The petition for a writ of certiorari was denied on January 16, 2024.
Contact:
Email ALF Executive Vice President & General Counsel Lawrence Ebner.
