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Update: Supreme Court rules in Daimler Alien Tort case

January 14, 2014 by Scott Bomboy


A unanimous Supreme Court said on Tuesday that DaimlerChrysler can’t be sued in district court in California for acts that happened during Argentina’s “dirty war” in the 1970s.350px-Supreme_Court_US_2010The Court was asked to answer the following question in DaimlerChrysler AG v. Bauman: Does a federal court have jurisdiction over a foreign corporation not incorporated in the forum state solely because the corporation’s indirect corporate subsidiary performs services for the corporation in the forum state?

The Court took the case to decide if Daimler could be sued in California courts for claims involving only foreign plaintiffs and conduct occurring entirely abroad, in relation to the 14th Amendment’s Due Process Cause.

In this case, Barbara Bauman and 22 Argentine citizens or residents sued DaimlerChrysler AG in 2004 for violations under the Alien Tort Claims Act, claiming that Daimler’s subsidiary in Argentina ordered state security forces to rid its plant of left-wing sympathizers.

DaimlerChrysler is a German company that doesn’t make or sell products in the U.S., but it owns a subsidiary, Mercedes Benz USA, that sells Daimler products here. Bauman and the others sued in the Northern District of California, claiming that the court had general personal jurisdiction over Daimler because of Mercedes Benz USA’s extensive contacts in California.

The Alien Tort Claims Act, or Alien Tort Statute, dates back to the Judiciary Act on 1789, and reads, “district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.”

Last April, the Court decided another case related to the act called Kiobel v. Royal Dutch Petroleum, where the Justices said Alien Tort Claims Act didn’t apply to misconduct that had no connection to the United States.

In the Daimler case, the workers and relatives of workers in Argentina sued for violations of the Torture Victims Protection Act of 1991.

On Tuesday, Justice Ruth Bader Ginsburg said, “there would still be no basis to subject Daimler to general jurisdiction in California, for Daimler’s slim contacts with the State hardly render it at home there.” Ginsburg reversed a judgment from the United States Court of Appeals for the Ninth Circuit.

Link: Read The Opinion

Justice Sonia Sotomayor issued an opinion that concurred with the Court’s judgment, but for different reasons. She believed the court in California had jurisdiction in the case, but it shouldn’t be decided in the United States.

“No matter how extensive Daimler’s contacts with Califor­nia, that State’s exercise of jurisdiction would be unrea­sonable given that the case involves foreign plaintiffs suing a foreign defendant based on foreign conduct, and given that a more appropriate forum is available,” she said.

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