Legal Newsline

Tuesday, July 16, 2019

SCOTUS: Mont. SC wrong to take in out-of-state lawsuits against railroad

By Charmaine Little | Jun 7, 2017

WASHINGTON (Legal Newsline) – The U.S. Supreme Court on May 30 reversed judgment in a case concerning general jurisdiction, finding that the Montana Supreme Court had misconstrued a unanimous 2014 decision.

The U.S. Supreme Court, in an opinion written by Justice Ruth Bader Ginsburg, ruled a railroad company can't be sued in Montana by employees who weren't injured there. The Montana Supreme Court had rejected BNSF's claim that the 2014 decision in Daimler AG v. Bauman established that Montana courts did not hold jurisdiction over their claims.

The two workers, Robert Nelson and Brent Tyrrell, had filed lawsuits for alleged on-the-job injuries under the Federal Employers Liability Act.

"The Montana Supreme Court distinguished Daimler on the ground that we did not there confront 'a FELA claim or a railroad defendant,'" Ginsburg wrote.

"The Fourteenth Amendment due process constraint described in Daimler, however, applies to all state-court assertions of general jurisdiction over nonresident defendants; the constraint does not vary with the type of claim asserted or business enterprise sued."

Nelson sued the railroad company in Montana’s 13th Judicial District Court, Yellow County, under claims that he was injured while working for the company. Kelli Tyrrell, the Special Administrator of the Estate of Brent Tyrrell, sued BNSF following Brent’s passing after he was allegedly exposed to toxic chemicals during his employment with BNSF. 

There was no indication of whether Nelson or Brent’s injuries occurred in Montana, although both parties filed in the state with claims that BNSF violated FELA.

The Montana Supreme Court attempted to validate Tyrrell's and Nelson’s filing in Montana using Section 56. 

It states, “Under this chapter an action may be brought in a district court of the United States, in the district of the residence of the defendant, or in which the cause of action arose, or in which the defendant shall be doing business at the time of commencing such action. The jurisdiction of the courts of the United States under this chapter shall be concurrent with that of the courts of the several states.”

The Supreme Court didn’t agree with the state court’s ruling.

"BNSF, we repeat, is not incorporated in Montana and does not maintain its principal place of business there. Nor is BNSF so heavily engaged in activity in Montana 'as to render [it] essentially at home' in that State," Ginsburg wrote, citing the Daimler decision. 

"As earlier noted, BNSF has over 2,000 miles of railroad track and more than 2,000 employees in Montana. But, as we observed in Daimler, 'the general jurisdiction inquiry does not focus solely on the magnitude of the defendant’s in-state contacts.' 

"Rather, the inquiry 'calls for an appraisal of a corporation’s activities in their entirety'; '[a] corporation that operates in many places can scarcely be deemed at home in all of them.'

"In short, the business BNSF does in Montana is sufficient to subject the railroad to specific personal jurisdiction in that State on claims related to the business it does in Montana. But in-state business, we clarified in Daimler and Goodyear, does not suffice to permit the assertion of general jurisdiction over claims like Nelson’s and Tyrrell’s that are unrelated."

Considering that BNSF has headquarters in Delaware and does its main business in Texas, the Supreme Court decided that the two parties did not have personal jurisdiction in Montana for their cases.

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