SCOTUS Rules States May Require Foreign Corporations to Consent to General Personal Jurisdiction as a Condition of Doing Business


The Supreme Court concluded its 2022 term with opinions on several headline-grabbing civil rights cases. Under the circumstances, it would be easy to overlook Mallory v. Norfolk Southern, No. 21-1168, 600 U.S. __ (2023). But regional and national corporations do so at their peril.

In Mallory, a divided Court upheld, by a 5-4 margin, a Pennsylvania statute requiring companies to consent to general personal jurisdiction as a condition of registering to do business there. Accordingly, in states that condition registration to do business on consent to jurisdiction, a company may be properly sued for any lawsuit, regardless of whether it relates to the company’s business, where the plaintiff is located, or where the injury occurred.

At least five other jurisdictions[1] have the same or similar consent statutes requiring all corporations to consent to certain types of suits, or certain types of corporations to consent to all types of suits, in order to do business there. For now, the takeaway from Mallory is that all of these consent statutes are likely valid and enforceable.

Mallory resolves confusion over the reach of International Shoe, perhaps the Court’s most widely cited personal jurisdiction decision, and the outcome is rooted in stare decisis. Beginning with International Shoe in 1945, the Supreme Court has consistently discussed states’ power to exercise general personal jurisdiction—i.e., jurisdiction over any claim, regardless of its connection to the forum—over corporations as being limited to two places: (1) where the corporation is incorporated; and (2) where the corporation has its “principal place of business.”

Hold on, writes Justice Gorsuch for the Mallory majority. International Shoe applies only to corporations that have not consented to in-state suits. International Shoe does not control where corporations have consented to such suits, including where that consent is given as a condition of registering to do business in the forum. Instead, consent-based jurisdiction is controlled by the Court’s 1917 decision in Pennsylvania Fire v. Gold Issue Mining.

Notably, Mallory did not finally resolve the fate of Pennsylvania’s consent statute. Justice Alito provided the deciding vote on stare decisis grounds. He wrote separately, however, to voice his concern that consent statutes like Pennsylvania’s might be subject to challenge on dormant Commerce Clause grounds. The majority left that question for consideration on remand. Given Mallory’s divided result, consent-by-registration statutes may not be finished at the Supreme Court.

To avoid any surprises in distant forums, corporations should educate themselves on the laws of those states where they do or are considering doing business. Businesses should also monitor states to see if they will pass legislation that similarly conditions registration to do business on consent to jurisdiction, as the Mallory dissent predicts. No doubt, creative plaintiffs’ attorneys will use these laws to find the most favorable forum that might exercise general jurisdiction over corporate defendants. 

[1] Those states are Georgia, Iowa, Kansas, and Minnesota, as well as Puerto Rico.

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