Lit Alerts—August 2017
In This Issue:
- Personal Jurisdiction: Missouri District Court Dismisses Out-Of-State Plaintiffs' Claims for Lack of Personal Jurisdiction
- White Collar: Second Circuit Limits Judicial Oversight of Deferred Prosecution Agreements
Personal Jurisdiction: Missouri District Court Dismisses Out-Of-State Plaintiffs' Claims for Lack of Personal Jurisdiction
In one of the first district court decisions to apply Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) (BMS), the District Court for the Eastern District of Missouri dismissed the claims of all but one non-Missouri plaintiffs for lack of personal jurisdiction. Ninety-four plaintiffs brought the product liability lawsuit, Jordan v. Bayer Corp., No. 4:17-cv-865, in January 2017, claiming they had been harmed by using Essure, a permanent birth control device made and sold by the defendants. Seven of the plaintiffs were citizens of Missouri; the remaining eighty-seven were citizens of other states.
It was undisputed that the Court could not exercise general jurisdiction over the defendants, as none of them were incorporated, had their principal place of business, or had "such substantial and extensive contacts such that they are essentially 'at home' in Missouri." Hence, the jurisdictional issue turned on whether the Court could exercise specific personal jurisdiction over the nonresident plaintiffs' claims.
Relying on the Supreme Court's recent decision in BMS, the Court ruled that there was no personal jurisdiction with respect to the non-Missouri plaintiffs' claims, with the exception of one non-Missouri plaintiff who claimed the device was implanted in Missouri. The other non-Missouri plaintiffs did "not allege that they acquired the Essure device from a Missouri source or that they were injured or treated in Missouri; thus, all the conduct giving rise to the nonresidents' claims occurred elsewhere. Moreover, defendants did not develop, manufacture, label, package, or create a marketing strategy for Essure in Missouri." Accordingly, the Court dismissed the claims of all but one of the non-Missouri plaintiffs, holding that "the general exercise of business activities in the state cannot create an adequate link between the claims and the Missouri forum."
White Collar: Second Circuit Limits Judicial Oversight of Deferred Prosecution Agreements
The Second Circuit held last month that an independent monitor report is not a "judicial document" and, among other things, largely curtailed district courts' oversight of deferred prosecution agreements. United States v. HSBC Bank USA, N.A., No. 16‐308(L) (2d Cir. July 12, 2017). The case arose from a five-year deferred prosecution agreement (DPA) that the government had entered into with HSBC Bank, USA, N.A. in 2012.
The DPA in question called for the appointment of an independent monitor to prepare periodic reports on HSBC's compliance with the DPA itself and with anti-money laundering laws. When the parties filed the DPA with the court and sought to exclude time under the Speedy Trial Act, the district court concluded that it had "authority to approve or reject the DPA pursuant to its supervisory power." The district court also conditioned its approval of the DPA on its own monitoring of the DPA's implementation. In November 2015, the district court received a letter from a member of the public seeking to unseal the independent monitor's report regarding HSBC's compliance. Finding that the monitor's report was a "judicial document" to which the public enjoyed a qualified First Amendment right of access, the district court granted the motion, which led to this appeal.
The Second Circuit held, inter alia, that because the report is not relevant to the performance of the judicial function, it is not a "judicial document," and the district court had erred in ordering it unsealed. The Court highlighted that "attempting to forecast the relevance of the [report] at the conclusion of the DPA's term is inherently speculative" and "cannot support treating [it] as a judicial document at this point in time."
The Second Circuit also revisited judicial oversight of DPAs generally. The Court held that "the district court impermissibly encroached on the Executive's constitutional mandate to 'take Care that the Laws be faithfully executed'" when it sua sponte invoked its supervisory power to oversee the implementation of the DPA at the outset of the case. Notably, the court concluded that absent unusual circumstances, "a district court's role vis‐à‐vis a DPA is limited to arraigning the defendant, granting a speedy trial waiver if the DPA does not represent an improper attempt to circumvent the speedy trial clock, and adjudicating motions or disputes as they arise."