The Supreme Court unanimously ruled today that Germany-based DaimlerChrysler could not be held liable for human rights abuses that took place in Argentina during that country’s “Dirty War” from 1976-1983 by suing the company in California.  The case arose after individuals and relatives of workers at Mercedes Benz of Argentina brought the action because of the Argentine subsidiary’s complicity with the regime in power during that time. The Court held that federal courts in California could not exercise jurisdiction, through Mercedes Benz USA, a wholly owned subsidiary of DaimlerChrysler, given the absence of any California connection to the atrocities, perpetrators, or victims. The Court held that “[e]xercises of personal jurisdiction so exorbitant . . . are barred by due process constraints on the assertion of adjudicatory authority.”

CCL filed an amicus brief on behalf of the American Association for Justice, urging the Court to issue a narrow decision that would not adversely affect assertions of jurisdiction over domestic parent corporations through the actions of their wholly owned subsidiaries that have activities in the forum state. The amicus brief was primarily authored by George Washington University associate dean Alan Morrison, with CCL President Robert S. Peck, New York University law professor Arthur Miller, and University of California at Irvine law dean Erwin Chemerinsky on the brief as well. The decision, written by Justice Ruth Bader Ginsburg, acknowledged that the decision did not reach that issue. As stated, the question decided was whether "Daimler is amenable to suit in California courts for claims involving only foreign plaintiffs and conduct occurring entirely abroad."  Thus, the opinion speaks to the "risks to international comity" of an assertion of jurisdiction over foreign events and involving foreign parties. On the other hand, the Court's discussion of agency indicates that a subsidiary can be a parent's agent for claims where the subsidiary operates, but not elsewhere, thereby preserving the jurisdiction that the AAJ amicus brief urged be left untouched by any decision.

Courtwatchers in the press also followed the decision to see if the Court would limit its decision to the international context. Bloomberg News quoted Peck as describing the opinion as a narrow one that didn’t preclude plaintiffs from pressing a different theory, one that claims a subsidiary was acting as the parent company’s legal agent.