The United States Supreme Court in BNSF Railway Co. v. Tyrrell addressed a significant question concerning the limits of state court jurisdiction over corporations operating nationwide. The case examined whether Montana state courts could exercise general personal jurisdiction over BNSF Railway Company, a major railroad, simply because of its substantial operations in the state. At stake was the interpretation of the Federal Employers’ Liability Act (FELA) and constitutional principles governing personal jurisdiction. The Court’s decision reinforced the narrow scope of general jurisdiction and clarified that neither FELA nor extensive business activities within a state automatically render a corporation “at home” there.
Background of BNSF Railway Co. v. Tyrrell
The litigation began with two separate lawsuits under the Federal Employers’ Liability Act (FELA). The first was brought by a North Dakota resident, Robert Nelson, who claimed he was injured while working as a truck driver for BNSF. The second lawsuit was filed by the executor of South Dakota resident Brent Tyrrell’s estate, alleging that Tyrrell developed fatal cancer due to exposure to toxic substances while working for the railroad.
Both plaintiffs filed their cases in Montana state courts. Importantly, neither Nelson nor Tyrrell resided in Montana, and the events underlying their claims did not occur there. BNSF Railway Company, although a major railroad with more than 2,000 miles of track and around 2,000 employees in Montana, was not incorporated in the state and did not have its principal place of business there. Instead, BNSF was incorporated in Delaware and headquartered in Texas.
BNSF moved to dismiss both suits for lack of personal jurisdiction, relying on the Supreme Court’s decision in Daimler AG v. Bauman (2014), which limited the circumstances in which state courts could exercise general jurisdiction over corporations. One Montana trial court agreed with BNSF and dismissed Nelson’s case, while another denied the motion in Tyrrell’s case. The Montana Supreme Court consolidated the appeals and ultimately held that Montana courts could exercise general jurisdiction over BNSF.
Montana Supreme Court’s Ruling
The Montana Supreme Court relied on two main grounds:
- FELA Section 56 – The court interpreted Section 56 of FELA, which allows actions to be brought where the defendant “shall be doing business,” as authorizing jurisdiction over BNSF in Montana. It reasoned that because BNSF conducted substantial operations in the state, Montana courts had jurisdiction under the statute.
- General Jurisdiction Principles – The Montana court also concluded that BNSF’s in-state operations were sufficiently extensive to make it “at home” in Montana. It emphasized that Daimler’s due process limits did not apply because Daimler did not involve FELA or a railroad defendant.
BNSF sought review by the United States Supreme Court, arguing that Section 56 of FELA was misinterpreted and that the Montana Supreme Court’s decision conflicted with Daimler.
Issues Before the Supreme Court
The U.S. Supreme Court granted certiorari to resolve two central issues:
- Whether Section 56 of FELA authorizes state courts to exercise personal jurisdiction over railroads doing business in their states but not incorporated or headquartered there.
- Whether the Montana courts’ exercise of personal jurisdiction over BNSF in these cases was consistent with constitutional due process.
Opinion of the Court
On May 30, 2017, the Supreme Court delivered its opinion in BNSF Railway Co. v. Tyrrell. Justice Ruth Bader Ginsburg authored the majority opinion, joined by all Justices except Justice Sonia Sotomayor, who filed a separate opinion concurring in part and dissenting in part.
FELA Section 56
The Court first rejected the Montana Supreme Court’s interpretation of FELA. It held that Section 56 does not address personal jurisdiction. Instead, the statute governs venue in federal courts and provides concurrent subject-matter jurisdiction for state courts. In other words, Section 56 allows state courts to hear FELA cases but does not expand their authority to assert personal jurisdiction over defendants.
General Jurisdiction and Daimler
Turning to constitutional due process, the Court applied its earlier reasoning from Daimler AG v. Bauman. Daimler established that a corporation is generally considered “at home” only in two places: its state of incorporation and its principal place of business. Only in rare “exceptional circumstances” could a corporation be deemed at home elsewhere.
Although BNSF had significant operations in Montana, the Court held that this did not render the company at home in the state. BNSF was incorporated in Delaware and headquartered in Texas, and the Court found no exceptional circumstances to justify general jurisdiction in Montana. The Montana courts therefore lacked personal jurisdiction over BNSF for claims unrelated to its activities in Montana.
Remand for Consent Issue
The employees also argued that BNSF had consented to jurisdiction in Montana. Because the Montana Supreme Court had not addressed this issue, the U.S. Supreme Court remanded the case for further consideration on that point.
Concurring and Dissenting Opinion
Justice Sonia Sotomayor concurred with the majority that Section 56 of FELA does not confer personal jurisdiction. However, she dissented from the Court’s conclusion that Montana courts could not exercise jurisdiction over BNSF.
Justice Sotomayor argued that Daimler’s restrictive interpretation of general jurisdiction was too narrow. She favored the traditional International Shoe Co. v. Washington standard, which focused on whether a corporation had “minimum contacts” with the forum state. In her view, BNSF’s extensive operations in Montana should have been sufficient to establish jurisdiction. At a minimum, she believed the Court should have allowed Montana to reconsider whether the circumstances were exceptional enough to warrant jurisdiction.
BNSF Railway Co. v. Tyrrell Judgment
The Supreme Court reversed the decision of the Montana Supreme Court. It held that Montana courts could not exercise general personal jurisdiction over BNSF Railway Company for claims unrelated to its activities in the state.
Conclusion
BNSF Railway Co. v. Tyrrell stands as a clear reaffirmation of the narrow scope of general jurisdiction. The Court held that Section 56 of FELA does not authorize state courts to exercise personal jurisdiction, and that a corporation is “at home” only in its state of incorporation or principal place of business, except in rare cases. While Justice Sotomayor dissented in part, the majority’s decision reflects the Court’s ongoing commitment to restricting general jurisdiction and aligning it with due process requirements.