Where is the appropriate place to sue a foreign company? The United States Supreme Court just established a new and more strict rule regarding the answer to that question.
In Daimler AG v. Bauman, 11-965, 2014 WL 113486 (U.S. Jan. 14, 2014), [READ CASE HERE] twenty-two Argentinian residents sued Daimler, an Argentinian Company, alleging that Daimler’s subsidiary assisted with state security services in killings, torture and other abuses. Although the allegations arose from conduct that occurred in Argentina, the lawsuit was brought in California. The plaintiffs (the above-referenced twenty-two residents who filed the lawsuit) brought suit in California. They argued that the applicable jurisdictional principles permitted suit to be filed in California because Daimler had an American subsidiary that did business in California. The Supreme Court disagreed. In its holding, it created a more restrictive standard than the mere fact that there was a subsidiary in a particular state. It required that there be more than just such “slim contacts.” Id.
The Daimler case is just one example of the trend in the law to make it more difficult to assert jurisdiction over a foreign entity.