Supreme Court Endorses "Jurisdiction By Consent" Theory In Latest Jurisdictional Salvo

• Published date: 04 July 2023
• Subject Matter: Litigation, Mediation & Arbitration, Compliance, Court Procedure
• Law Firm: Arnold & Porter
• Author: Mr Anand Agneshwar, Paige Hester Sharpe, Anna K. Thompson and Kaitlyn Schaeffer

On June 27, 2023, the U.S. Supreme Court ruled in Mallory v. Norfolk Southern Railway Co., No. 21-1168, a case that raised the question of whether an out-of-state company's compliance with a business registration statute gives rise to jurisdiction. In a divided opinion likely to spur further litigation about the decision's applicability under a different registration statute and outside of the case-specific facts, the Supreme Court held that consent-by-registration does not run afoul of the Due Process Clause, at least under certain circumstances. That opinion is a marked departure from the way many courts understood the Supreme Court's recent decisions curtailing general jurisdiction in Daimler and specific jurisdiction in Bristol-Myers Squibb. See Daimler AG v. Bauman, 571 U.S. 117, 137 (2014) (a company is "at home" and subject to general jurisdiction where it is incorporated and where it maintains its principal place of business); Bristol-Myers Squibb Co. v. Superior Court of Cal., S.F. Cnty., 582 U.S. 255, 264 (2017) (court lacks specific jurisdiction over out-of-state defendant for claims brought by out-of-state residents for out-of-state injuries).

The Facts in Mallory

In Mallory, a Virginia resident filed a personal injury action in Pennsylvania, alleging that he developed cancer from exposure to asbestos and other toxic chemicals while working for the defendant ' a Virginia railroad company. None of the alleged exposure occurred in Pennsylvania. The plaintiff's only basis for asserting personal jurisdiction was the defendant's compliance with Pennsylvania's business registration statute, 15 Pa.C.S. ' 411(a), as "qualification as a foreign corporation under the laws of this Commonwealth" is a "sufficient basis of jurisdiction to enable the tribunals of [Pennsylvania] to exercise general personal jurisdiction over such person." 42 Pa.C.S. ' 5301(a)(2)(i).

The defendant moved to dismiss for lack of personal jurisdiction. The trial court agreed, and the Pennsylvania Supreme Court affirmed, holding that the state's statutory scheme was incompatible with the Fourteenth Amendment's due process guarantees. Compliance with the state's mandatory registration requirement could not constitute voluntary consent to jurisdiction notwithstanding that Pennsylvania's statute expressly provides for jurisdiction by registration. Mallory v. Norfolk S. Ry. Co., 266 A.3d 542 (Pa. 2021). To find otherwise, the Pennsylvania Supreme Court concluded, would "eviscerate[] the Supreme Court's general...