While lower courts garner nearly all cases that reach the Supreme Court, there are numerous technical, yet imperative, regulations that determine how these courts function and the kinds of cases they are allowed to hear. One such regulation came forth in the aftermath of the 1878 case Pennoyer v. Neff, which stated that a court only has jurisdiction over an individual if they live in the same geographic area as the court or committed a legal offense in this area (1). This rule helped determine a court’s power at the time, though it remained to be seen how the rule would adjust to later developments in business and technology.

In 2015, Montana resident Markkaya Jean Gullett was driving her Ford Explorer on a Montana highway when the tread on one of her tires separated, resulting in her losing control of her vehicle and dying in a crash (2). A representative of hers sued Ford for defects and warning failures. Ford attempted to dismiss these claims on the basis of lack of personal jurisdiction. Ford is neither incorporated in nor headquartered in Montana, and the vehicle itself was neither manufactured nor sold in Montana. Despite this, the district court declined Ford’s request to dismiss, a decision that was upheld by the Montana Supreme Court. They maintained that Ford had “availed itself of the privilege” of doing business in Montana by advertising and selling parts, and thus, it was under the jurisdiction of the state. The case, Ford Motor Company v. Montana Eight Judicial District Court, was consolidated with Ford Motor Company v. Bandemer (same issue in question, only in Minnesota) and taken to the Supreme Court in 2020.

For the Supreme Court to make rulings that are consistent in reasoning, stare decisis is implemented to warrant the continuation of precedent set in similar cases previously (3). An important precedent in the Ford case was the 1945 landmark ruling International Shoe Co. v. Washington. It established that a defendant is found to be under the jurisdiction of an outside state (a state that is not where the company is headquartered nor incorporated in) if they are judged to have “minimum contacts” with the state (4). By using this case as precedent, the Supreme Court unanimously reaffirmed the decision made by the lower courts due to the connection between the respondents’ product-liability claims from car accidents in each state and how Ford conducted business in each state. In her majority opinion, Justice Kagan particularly stated that causation is irrelevant in this case; Ford’s activities in Montana do not have to be the cause of the plaintiff’s charges, only related. It should also be noted that this ruling was a narrow opinion that wouldn’t apply if the respondent was not a resident of the forum state or if the petitioner did not market the exact model of vehicle that the crash occurred in (5). Ultimately, it was Ford’s promotion and distribution of the two car models in each respondent’s respective state (even if they were not the two specific cars involved in the case) that allowed the Supreme Court to assert that Ford had minimum contacts in both states.

While Ford’s being held liable was clearly based on precedent, the ramifications of the decision are not as obvious. Since the Supreme Court determined that Ford did have minimum contacts in a state that was not their primary market for business, the Court has effectively broadened the scope of personal jurisdiction for large corporations that conduct business in multiple states (6). Due to the increased subjective nature of the new guidelines, it has become more difficult for corporations to determine if their operations in certain states are minimal enough to where they would not be subject to a possible lawsuit in those states. While Ford conducted sales, marketing, and repair services in Montana and Minnesota, it remains unclear whether a company in the future could be claimed to be under the jurisdiction of an outside state if they only engaged in one or two of the aforementioned “contacts”. Justice Gorsuch acknowledged that the terms “affiliation”, “relationship”, and “connection” were not defined by the Court, hence requesting circuit courts to carry the burden of establishing what qualifies as such. This lack of clarity from the Supreme Court obscures what a potential ruling from the Court may be when a corporation has no physical presence or operations in an outside state, as would be the case with the internet.

Although the internet’s novelty means there is little precedent to assist courts when deciding a case, there are methods in place to distinguish what can be considered personal jurisdiction over an operator of a website. One such method is “interactive vs. passive determination”, where a defendant would be claimed to be under the jurisdiction of the forum state if there is dual communication (two-way, interactive communication where both parties are involved) by parties as it concerns a formal, business relationship (7). Courts have often declined exercising personal jurisdiction in cases where contact with a state is limited to website advertising and/or providing information for browsing purposes. However, when business dealings transpire, such as online sales or the agreement of contracts with forum residents, courts have ruled in favor of exercising personal jurisdiction. A grey area does exist where a case may be neither interactive nor passive, such as an interactive website that can be accessed in a state but isn’t directed at the state nor used by the state’s residents. There are global implications to this ambiguity, as international companies may localize their websites to certain states to minimize their extent on the internet, ensuring that external parties are not able to interact with their websites (8). Data analytics technology can additionally be employed to determine where the marketing and purchasing of online goods is occurring, providing companies assurance as to where they could be held liable.

Although the Court’s decision was pro-consumer, it has also created multiple ambiguities that businesses are not willing to risk venturing into. To alleviate the stress on these businesses, it is in the Court’s interest to clarify what constitutes personal jurisdiction as business operations are concerned, helping both businesses and consumers partake in a thriving economy and society.