As we previously reported, courts continue to sift through the unsettled law left in the wake of the U.S. Supreme Court’s decision in Bristol-Myers Squibb v. Superior Court of California. The decision involved a mass tort action in which the California Supreme Court asserted specific personal jurisdiction over the claims of non-resident plaintiffs who were allegedly injured outside the state of California. The U.S. Supreme Court disagreed, holding that the exercise of jurisdiction over non-residents was a violation of the defendant’s Fourteenth Amendment due process rights. Although Bristol-Myers set a clear precedent as to mass tort actions, the Supreme Court left open the question of whether the same logic would apply in the class action context. As a result, federal district courts are split over whether Bristol-Myers applies to class actions.
The U.S. District Court for the Middle District of Florida recently examined this issue in Brotz v. Simm Associates, Inc., a putative nationwide class action alleging unlawful debt collection practices. Specifically, plaintiff alleged that defendant debt collector withdrew unauthorized convenience fees and credit card payment fees in connection with her monthly student loan payments; based on the foregoing, plaintiff sought to represent a nationwide class against defendant for violations of the Fair Debt Collection Practices Act, Florida’s Consumer Collection Practices Act, and claims for breach of contract and unjust enrichment.
In March, the defendant brought a motion to dismiss claiming that the assertion of personal jurisdiction over non-Florida putative class members would be improper, consistent with the Supreme Court decision in Bristol-Myers. Although defendant cited those cases applying Bristol-Myers to class actions, the court found the other side of the split of authority more compelling. In particular, the court relied on the ruling by the U.S. District Court for the District of Columbia in Molock v. Whole Foods, noting that there are “material distinctions between a class action and a mass tort action.” The court ultimately denied the defendant’s motion to dismiss and joined the D.C. District Court in finding that Bristol-Myers does not bar nationwide class actions with non-resident class members.
Will the negative precedents in D.C. and Florida federal district courts continue to haunt defendants seeking dismissal of nationwide class actions for lack of personal jurisdiction? Stay tuned to the blog for more developments.