Monday, May 2, 2022

SCOTUS to review SCOPA on personal jurisdiction for corporations

It's not every day that the Supreme Court of the United States (SCOTUS) grants certiorari to hear a case from the Supreme Court of Pennsylvania (SCOPA) - but it just happened! SCOTUS will hear Mallory v. Norfolk Southern Railway Co., and the issue presented is:

Whether the due process clause of the 14th Amendment prohibits a state from requiring a corporation to consent to personal jurisdiction to do business in the state.

 From SCOPA's opinion:

Under Pennsylvania law, a foreign corporation "may not do business in this Commonwealth until it registers" with the Department of State of the Commonwealth. 15 Pa.C.S. § 411(a). Further, "qualification as a foreign corporation under the laws of this Commonwealth" constitutes a sufficient basis to enable Pennsylvania courts to exercise general personal jurisdiction over a foreign corporation. 42 Pa.C.S. § 5301(a)(2)(i).

Put differently: a corporation that registers to do business in Pennsylvania is forced to "consent" to jurisdiction here, even if the corporation lacks "continuous and systematic affiliations" with Pennsylvania. Cutting to the chase, SCOPA ruled:

Legislatively coerced consent to general jurisdiction is not voluntary consent and cannot be constitutionally sanctioned. Accordingly, our statutory scheme is unconstitutional to the extent that it affords Pennsylvania courts general jurisdiction over foreign corporations that are not at home in the Commonwealth.

Many other courts have chimed in on this general issues (involving other states' statutory frameworks). This could be a big personal jurisdiction case for corporate parties. 

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