On May 30 the Supreme Court issued a decision limiting railroad employees’ ability to forum shop when filing lawsuits for on-the-job injuries.
The case is BNSF Railway Co. v. Tyrrell. This ruling came just days after the Court’s May 22 decision in TC Heartland LLC v. Kraft Foods Group Brands, which limits where patent owners can file infringement lawsuits.
The BNSF case followed two railroad workers employed by BNSF Railway Company (BNSF). The employees, Robert Nelson and Brent Tyrrell, were residents of North Dakota and South Dakota respectively. While working for BNSF, the Nelson and Tyrrell sustained injuries but not in Montana. Both employees brought suits against BNSF, citing the Federal Employers’ Liability Act (FELA). Under FELA, employers can be liable in money damages to their workers for on-the-job injuries. In addition to not being residents of Montana, neither Nelson nor Tyrrell were working in Montana at the time they were injured on-the-job, or at any other time during their employment with BNSF.
Section 56 of FELA states that “an action may be brought in a district court of the United States,” including the district “in which the defendant shall be doing business at the time of commencing such action.”
BNSF moved to dismiss both lawsuits arguing it is neither incorporated nor headquartered in Montana, and the employees were neither residents of, nor working in, Montana. The Montana Supreme Court allowed the cases to proceed in Montana, stating that Section 56 gave the two employees personal jurisdiction over BNSF. The United States Supreme Court reversed.
The Supreme Court interpreted Section 56 to be a venue description rather than one governing personal jurisdiction. According to the ruling, FELA does not allow state courts to proceed with claims simply because the employer does business in the state. The Court cited the Act’s phrase “at home.” As many companies do business across many states, it is impossible for multiple states to be a “home” to the company.
This ruling prevents railroad workers from venue shopping, as employees are no longer able to file claims in a more favorable jurisdiction. This decision aligns with the Court’s May 22 ruling in TC Heartland, which narrowed the interpretation of venue in patent lawsuits, preventing companies from bringing their suits in “patent friendly” jurisdictions.
For information on how this ruling affects your business, contact our Sioux City Law Firm, Sioux Falls Law Firm or Omaha Law Firm today!
Check out our blog about another Supreme Court ruling that may affect your business!