DaimlerChrysler AG v. Bauman

PETITIONER: DaimlerChrysler AG
RESPONDENT: Barbara Bauman et al.
LOCATION: Gonzalez Catan Plant

DOCKET NO.: 11-965
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT:

CITATION: 571 US (2014)
GRANTED: Apr 22, 2013
ARGUED: Oct 15, 2013
DECIDED: Jan 14, 2014

ADVOCATES:
Edwin S. Kneedler - Deputy Solicitor General, Department of Justice, for the United States as amicus curiae, supporting the petitioner
Kevin Russell - on behalf of the respondents
Kevin K. Russell - for the respondents
Thomas H. Dupree Jr. - for the petitioner

Facts of the case

The workers and relatives of workers in the Gonzalez-Catan plant of Mercedes Benz Argentina, a wholly owned subsidiary of German-based DaimlerChrysler AG ("the company"), sued the company for violations of the Torture Victims Protection Act of 1991. They argued that, during Argentina's "Dirty War" of 1976-1983, the company sought to punish plant workers suspected of being union agitators and worked with the Argentinean military and police to do so by passing along information and allowing the plant to be raided. The plaintiffs also argued that the company stood to gain from these actions as they ended strikes and allowed the plant to continue operating at maximum production levels.

The plaintiffs sued the company in district court in California, where some of the company's major subsidiaries are located under the Alien Torts Act, and the company moved for dismissal based on a lack of personal jurisdiction. The district court granted the motion for dismissal and held that the company did not have enough contacts in California to warrant a California court exercising jurisdiction. The U.S. Court of Appeals for the Ninth Circuit reversed the decision and held that it is reasonable for a California court to have jurisdiction over a multinational company that is capable of litigating the case regardless of the location and has pervasive business contacts in the state.

Question

Can a court exercise jurisdiction over a foreign company based on the fact that a subsidiary of the company acts on its behalf in the forum state?

Media for DaimlerChrysler AG v. Bauman

Audio Transcription for Oral Argument - October 15, 2013 in DaimlerChrysler AG v. Bauman

Audio Transcription for Opinion Announcement - January 14, 2014 in DaimlerChrysler AG v. Bauman

Justice Ginsburg has our opinion in case 11-965, Daimler vs. Bauman.

In this case concerns the authority of a court in the United States to entertainment a claim brought by foreign plaintiffs against a foreign defendant based on events occurring entirely outside the United States.

The litigation commenced in 2004 when 22 Argentinean residence filed a complaint in the United States District Court for the Northern District of California against DaimlerChrysler Aktiengesellschaft hereafter Daimler, a German public stock company, headquartered in Stuttgart that manufactures Mercedes-Benz vehicles in Germany.

The complaint alleged that during Argentina's 1976 to 1983 “Dirty War,” Daimler's Argentinian subsidiary Mercedez-Benz Argentina (MB Argentina) Collaborated with state security forces to kidnap, detain, torture, and kill certain MB Argentina workers, among them, plaintiffs or persons closely related to plaintiffs.

Damages for the alleged human-rights violations were sought under the laws of the United States, California, and Argentina.

Jurisdiction over the lawsuit was predicated on the California connections of yet another entity Mercedes-Benz USA, (MBUSA), a subsidiary of Daimler incorporated in Delaware with its principal place of business in New Jersey.

MBUSA distributes Daimler-manufactured vehicles to independent dealerships throughout the United States, including California.

The question presented is whether the Due Process Clause of the Fourteenth Amendment precludes the District Court from exercising jurisdiction over Daimler, given the absence of any California connection to the atrocities, perpetrators, or victims.

Plaintiffs invoked the court's general or all-purpose jurisdiction.

California, they urge, is a place where Daimler may be sued on any and all claims against it, wherever in the world the claims may arise.

For example, in plaintiff's view, if a Mercedes-Benz vehicle overturned in Saudi Arabia, injuring a driver and passengers from Norway the injured persons could maintain a design defect suit in California.

The District Court granted Daimler's motion to dismiss for lack of jurisdiction, reversing the District Court's judgment, the Court of Appeals held that MBUSA which it assumed to fall within California courts' all-purpose jurisdiction, was Daimler's "agent" for jurisdictional purposes, so that Daimler, too, should generally be answerable to suit in that State.

Exercises of personal jurisdiction of such breath we hold today are barred by due process constraints on the assertion of adjudicatory authority.

Three years ago in Goodyear Dunlop Tires Operations v. Brown, we stated that a court may assert general or all-purpose jurisdiction over a foreign corporation only when the corporation's affiliations with the State in which suit is brought are so constant and pervasive as to render it essentially at home in the forum State.

Instructed by Goodyear, we conclude Daimler is not at home in California, and cannot be sued there for injuries plaintiffs attribute to MB Argentina's conduct in Argentina.

Plaintiffs had originally stated claims under two federal statutes, the Alien Tort Statute and the Torture Victim Protection Act.

Maintaining that those statutes supported jurisdiction over torturers wherever they may have acted and whomever they may have victimized.

But we have recently made plan that in neither statute which is the offshore conduct alleged in this case.

The judgment of the Court of Appeals for the Ninth Circuit is reversed.

Justice Sotomayor has filed an opinion concurring in the judgment.