Bauman et al., v. DaimlerChrysler AG

Case Updates

The petition for rehearing en banc was denied.

Defendant-Appellee DaimlerChrysler AG later petitioned the U.S. Supreme Court to hear the case. The Supreme Court granted the case, and ultimately reversed the ruling of the Ninth Circuit, holding that Daimler AG is not amenable to suit in California for injuries allegedly caused by conduct of MB Argentina that took place entirely outside the United States.

NCLC urged the Ninth Circuit to review en banc its panel opinion that upheld general jurisdiction over DaimlerChrysler AG, a foreign defendant, based simply on its commercial relationship with a United States-based distributor. This is contrary to the Supreme Court’s decision in Goodyear and effectively makes DaimlerChrysler AG answerable in California for any claim arising anywhere in the world irrespective of whether those claims have anything to do with California. In 2004 the panel issued an opinion, based on circuit precedent, to conclude that jurisdiction over DaimlerChrysler AG was improper. Less than two years later, using the same circuit precedent, the panel reversed. NCLC argued that the opinion creates intracircuit and intercircuit conflicts over the theories for imputing a subsidiary’s jurisdictional contacts to a nonresident parent corporation. NCLC warned that the opinion discourages foreign direct investment, threatens American companies with retaliatory assertions of judicial jurisdiction by foreign courts, and jeopardizes small business owners.