Mallory v. Norfolk S. Railway, No. 21-1168 (U.S. Jun. 27, 2023)
Like most states, Pennsylvania has statutes that require foreign corporations doing business in the state to register and designate an agent for service of process. Unlike most states, however, Pennsylvania’s statutes say that, by availing oneself of that process, a foreign corporation consents to general jurisdiction in the state. That is, it consents to personal jurisdiction, even in cases, like this one, that have no relationship to the corporation’s contacts with the state. The question is whether that kind of setup satisfies due process.
In a weird 4-1-4 decision, the Supreme Court says it does. The opinion of the Court is written by Justice Gorsuch and joined by Justices Thomas, Alito, Sotomayor and Jackson. The Court explains that because personal jurisdiction is a personal right that can be waived, there is nothing wrong with jurisdiction by consent, including when that consent is required to be given as a condition of obtaining privileges under state law. A pre-International Shoe decision from the Court—Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining & Milling Co., 243 U. S. 93 (1917)—so holds. And because the Court holds that Pennsylvania Fire remains good law on jurisdiction by consent, that pretty much resolves the question.
Justice Alito, however, doesn’t join the whole opinion. He agrees Pennsylvania Fire controls the due process question, and that the Court needn’t overrule it. But he has doubts about whether a state can impose such conditions under Dormant Commerce doctrine. He says forcing a foreign corporation to submit to personal jurisdiction over claims that are unrelated to its contacts with the state is effectively a form of discrimination against out of state companies that is unjustified by any legitimate local interests.
Justice Barrett dissents, joined by the Chief Justice and Justices Kagan and Kavanaugh. She says that the Court’s ruling effectively nullifies the recent Daimler/Goodyear/BNSF line of cases that hold that just doing business in a state is inadequate to create general jurisdiction. The consent that Pennsylvania secures by virtue of registration goes too far. Indeed, it would effectively permit a state to write a long-arm statute conferring general jurisdiction over any company that did business in the state.
Reversed.
For what it’s worth, amongst us Californians, California has a registration and agent for service of process requirement for foreign corporations doing business here. See Corps Code § 2105. But the Court of Appeal has consistently interpreted it not to provide a foreign corporation’s consent to general jurisdiction unrelated to the corporation’s California contacts. See Gray Line Tours v. Reynolds Elec. & Eng'g Co., 193 Cal. App. 3d 190, 195 (1987); DVI, Inc. v. Superior Court, 104 Cal. App. 4th 1080, 1095 (2002).
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