In MAG IAS Holdings, Inc. v. Schmuckle (No. 16-1550), the Sixth Circuit issued its first published decision interpreting the reach of specific jurisdiction under Walden v. Fiore, 134 S. Ct. 1115 (2014). The panel held that Walden stands for the idea that “an out-of-state injury to a forum resident, standing alone, cannot constitute purposeful availment” and that just knowing that out-of-state actions will have effects within the jurisdiction is not enough. In this case, a chief executive officer in Germany directed certain subsidiaries and their employees in Michigan, met with clients in Michigan, and essentially held himself out as responsible for those subsidiaries. The panel held that these actions were sufficient to create specific jurisdiction because the plaintiffs’ claim was that Schmuckle had used his power over the Michigan subsidiaries to transfer work and money from Michigan to operations in Germany for his own benefit. The opinion, written by Judge Gibbons, emphasizes the close connection between the defendant’s deliberate contacts with the forum and the claims alleged in the complaint.
MAG IAS Holdings will be a useful yardstick for parties trying to determine what kind of contacts created by the defendant will be important and how those contacts must relate to the substance of the case. Note that the other Sixth Circuit case interpreting Walden is the unpublished Maxitrate Tratamento Termico E Controles v. Super Sys., Inc., 617 F. App’x 406 (6th Cir. 2015), which held that Walden conclusively rejected a broad reading of the “effects test” under Calder v. Jones, 465 U.S. 783 (1984).