Supreme Court Makes It Easier to Sue Car Companies Over Defects

March 25, 2021 Updated: March 25, 2021

The Supreme Court unanimously rejected Ford Motor Co.’s claim that people who buy its cars in states with little connection to the company shouldn’t be allowed to sue in personal injury lawsuits, a ruling that will make it easier for plaintiffs to sue automakers throughout the country.

The ruling, issued March 25, covers two appeals, Ford Motor Co. v. Montana Eighth Judicial District Court, court file 19-368, and Ford Motor Co. v. Bandemer, court file 19-369.

Conventional legal thinking has been that plaintiffs injured in vehicles can’t sue the automaker if the states in which they were injured have a weak business connection to the automaker. Ford argued it could only be sued in states if the cars were designed, manufactured, or sold there.

A plaintiff’s claim ought to “have at least some causal connection to some act the defendant took in … the forum” in which the lawsuit is being heard, the company stated in court documents.

In 2015, Minnesota resident Adam Bandemer was a passenger in a 1994 Ford Crown Victoria driven on a Minnesota road. The driver rear-ended a snowplow, and the car ended up in a ditch. Bandemer, who suffered a brain injury, claims the airbag failed to deploy because of a defect and sued, alleging product liability, negligence, and breach of warranty claims against Ford.

Montana resident Markkaya Jean Gullett, a married mother of two, had been driving a 1996 Ford Explorer on a Montana highway in 2015 when the tread on one of her tires separated. She lost control and died at the scene of the crash. The executor of her estate sued, advancing design-defect, failure-to-warn, and negligence claims against the company.

Ford argued state courts in Minnesota and Montana shouldn’t have jurisdiction because the connections between the company’s activities in those states and the plaintiffs’ claims are too far removed. Neither of the vehicles involved was made or sold in Minnesota or Montana.

Courts in both states disagreed with Ford and their decisions were upheld by divided state Supreme Courts. Moreover, courts throughout the nation have rendered an array of contradictory rulings on the jurisdiction issue, which business advocates say encourages plaintiffs to go forum-shopping.

But the Supreme Court rejected Ford’s reasoning, finding the company was far too well-established to rely on that argument.

“Ford is a global auto company,” Kagan wrote in the 8–0 court opinion.

“It is incorporated in Delaware and headquartered in Michigan. But its business is everywhere. Ford markets, sells, and services its products across the United States and overseas. In this country alone, the company annually distributes over 2.5 million new cars, trucks, and SUVs to over 3,200 licensed dealerships.”

“In each of these two cases, a state court held that it had jurisdiction over Ford Motor Company in a products liability suit stemming from a car accident,” Kagan wrote.

“The accident happened in the State where suit was brought. The victim was one of the State’s residents. And Ford did substantial business in the State—among other things, advertising, selling, and servicing the model of vehicle the suit claims is defective.

“Still, Ford contends that jurisdiction is improper because the particular car involved in the crash was not first sold in the forum State, nor was it designed or manufactured there. We reject that argument. When a company like Ford serves a market for a product in a State and that product causes injury in the State to one of its residents, the State’s courts may entertain the resulting suit.”

Justice Amy Coney Barrett didn’t participate in the case, which was argued on Oct. 7, 2020, before she joined the court.

Justices Samuel Alito and Neil Gorsuch wrote separate concurring opinions.

“Ford has long had a heavy presence in Minnesota and Montana,” Alito wrote.

“It spends billions on national advertising. It has many franchises in both States. Ford dealers in Minnesota and Montana sell and service Ford vehicles, and Ford ships replacement parts to both States. … Ford, however, asks us to adopt an unprecedented rule under which a defendant’s contacts with the forum State must be proven to have been a but-for cause of the tort plaintiff’s injury. The Court properly rejects that argument.”