Bauman vs Daimler Chrysler: A winning dissent
On August 28, 2009, the 9th Circuit affirmed the dismissal of a lawsuit brought by persons allegedly tortured at the request of Mercedes-Benz personnel and their affiliation with the Argentine government in the 1980s. The 9th Circuit dismissed the case, finding that the plaintiffs had failed to show "minimum contacts" Daimler Chrysler and Mercedes Benz USA.
What is striking about this opinion is the well-reasoned, lengthy and detailed dissent of Judge Stephen Reinhardt. Judge Reinhardt explains that the 9th Circuit has now set the bar too high under the Constitution, and provides a scholarly road-map explaining why the case should be allowed to continue:
"In an increasingly complex and globalized economy, corporations such as [Daimler Chrysler] reap enormous profits from the sale of their goods in the United States, achieved through the use of distributors, frequently in the form of subsidiaries. Many multinational companies organize their corporate structure and acquire subsidiaries for the sold purpose of obtaining maximal benefit in the American market. ….Given these realities, and the continually evolving ways of doing business in an international area, it is a mistake for the majority to formalize and rigidify our test for personal jurisdiction with an overemphasis on control."
A must read for students of corporate jurisdiction.
Bauman et al. v. Daimler Chrysler, 2009 DJDAR 12916, AO 07-15386, August 28, 2009.