BNSF and Domestic Defendants

BNSF and Domestic Defendants

Goodyear and Daimler both involved foreign corporations, so a careful reader might suppose that the at-home test shields only foreign defendants, perhaps because of the concern about reaching across national borders that Daimler mentioned. BNSF Railway Co. v. Tyrrell dispels that supposition. Its defendant was an American railroad sued in an American state, and the Court held that a corporation is not subject to general jurisdiction in a state merely because it does substantial business there. Absent exceptional circumstances, general jurisdiction exists only where the corporation is at home, meaning its place of incorporation or principal place of business.¹

Two plaintiffs who neither lived in Montana nor claimed injury there sued the railroad in a Montana court under the Federal Employers' Liability Act.² Their claims had no tie to Montana, so specific jurisdiction was unavailable and general jurisdiction was their only route. The railroad's Montana presence was large by any ordinary measure: over 2,000 miles of track and thousands of employees. The doing-business test would once have counted that presence, yet Montana was neither the railroad's state of incorporation nor its principal place of business.³

The Court held, eight to one, that the railroad was not at home in Montana and so was not subject to general jurisdiction there.⁴ It applied the appraisal that Daimler required, which weighs a corporation's activities in their entirety, nationwide and worldwide, rather than the in-state portion alone. A corporation that operates in many places can scarcely be deemed at home in all of them.⁵ Set beside the rest of the railroad's system, the Montana track and workforce were one part of a larger enterprise, and the Court concluded that the railroad was not at home there.⁶ Any other result would make at home synonymous with doing business, the tests framed before specific jurisdiction evolved.⁷ Treating Montana as one place among many where the railroad works matches Daimler's conclusion about California. The Court named no percentage at which a forum becomes a home, and a presence that is large in absolute terms can still be a small part of the whole.

A national railroad shows why the comparison runs against the whole enterprise, since it operates in many states at once. If a state's share of track and workers made the railroad at home there, the same reasoning would make it at home in every state it serves, and plaintiffs could sue it on any claim from anywhere in dozens of forums. That result would revive the doing-business test under a new name. It would also hand plaintiffs a menu of forums chosen for reasons unrelated to the dispute, the forum-shopping incentive that general jurisdiction over unrelated contacts creates.⁸ Anchoring home to a very small number of places reserves the category for the forums where a company is centered, and the Court's decisions suggest that a corporation has only one or two such forums, something akin to a domicile.⁹ The Court still disclaims the view that the place of incorporation and the principal place of business are the only possible homes. But Daimler and BNSF make clear that any other home must be something very close to those.¹⁰

Justice Sotomayor had seen this coming. Concurring in the judgment in Daimler, she observed that the majority's principle would apply equally to a U.S. company incorporated and based in another state: a General Motors autoworker who retires to Florida could not sue GM there for disabilities developed at a Michigan parts plant, even though GM does considerable business in Florida.¹¹ BNSF turned that observation into a holding about a domestic railroad.¹² The at-home limit protects a defendant whose home is elsewhere from a state court's reach, and a Delaware corporation based in Texas is as much an outsider to Montana as a German manufacturer is to California. The concern about foreign relations that Daimler added reinforced its result without being its foundation, so removing it in a domestic case takes nothing from the rule.

The paradigm forums remain available for the same claim. Because the railroad is incorporated in Delaware and based in Texas, a suit on any claim, including one with no tie to either state, rests on a paradigm home forum in a Delaware or Texas court.¹³ The plaintiffs therefore had forums available, and Montana was not among them for claims unconnected to the state. A claim that does grow out of the in-state operations belongs to a different category, and the contrast shows which fact carries the analysis.

The question for the brakeman is whether the claim arises out of or relates to the railroad's Wyoming contacts, however large or small those contacts look in the national picture.¹⁴ Substantial in-state business therefore remains a basis for specific jurisdiction over the claims it generates, while it cannot support general jurisdiction over claims it did not generate.

An exam stem that recites thousands of miles of track, dozens of stores, or a large workforce in the forum invites the inference that so much presence must make the defendant at home. That inference answers the question the doing-business era asked. The at-home question asks whether the forum is the place of incorporation or the principal place of business, and only in an exceptional case, taken up later in this chapter, whether the defendant's operations there are so substantial that it is at home anyway.¹⁵ A stem that places the defendant in another American state does not take it outside that analysis, and a stem that makes the plaintiffs nonresidents with injuries elsewhere leaves general jurisdiction as the only route.