Original arguments and business interests conflict in dispute over company can be sued

Case preview

Norfolk Southern Railroad locomotives at a rail yard near Harrisburg, Pennsylvania. (Caseyjonz via Wikimedia Commons)

On Tuesday, the Supreme Court will hear oral arguments on a major dispute over personal jurisdiction — the court’s power to hear lawsuits against defendants.problems in Mallory v. Norfolk Southern Railroad It’s whether a Pennsylvania court can hear a lawsuit brought by a Virginia man who worked for the Virginia and Ohio Railroad against the Virginia Railroad. If a judge answers “yes,” businesses may soon be sued for all types of claims in many or all of the states in which they do business.


Under personal jurisdiction law, a plaintiff can always sue a company in the state where the company is incorporated or in the state where it has its principal place of business. That’s because courts in those states have “general” jurisdiction over corporations. But the ability to sue companies in other states is more limited. Generally, lawsuits in other states are only permitted under two circumstances: first, if the company voluntarily agrees to be sued in that state, and second, if the company is there to engage in activities related to the plaintiff’s lawsuit.

Mallory is a law relating to the state of Pennsylvania that imposes general jurisdiction over any corporation doing business in the state. Pennsylvania requires out-of-state companies to be registered in the state when doing business in the state, and this registration gives Pennsylvania courts general jurisdiction over these companies under state law. Various business groups — and the Biden administration — have warned that if Pennsylvania’s plan is allowed to stand, other states will follow suit, an outcome that would greatly expand states’ ability to exercise jurisdiction over companies. But proponents of the Pennsylvania law say it is consistent with the original understanding of the Constitution and must be upheld under the current court’s history-based approach to many constitutional issues.

The plaintiff in the case is Robert Mallory, who worked for the Norfolk Southern Railway Company. 17 years. During that time, Mallory said, he was exposed to asbestos and other cancer-causing chemicals and was diagnosed with colon cancer as a result. Mallory went to court in 2017 to hold the railroad company liable. Although the facts on which the lawsuit is based did not take place in Pennsylvania, Mallory maintains that Pennsylvania courts have jurisdiction over the Norfolk Southern Railroad because the railroad is registered to do business in the region.

The state trial court dismissed Mallory’s case, agreeing that Norfolk Southern had no jurisdiction over the railroad. The trial court concluded that Pennsylvania’s registered program violated the due process clause of the 14th Amendment — which, among other things, guarantees fair treatment to the government — which in all cases gives state courts the right to out-of-state corporations jurisdiction. The Pennsylvania Supreme Court upheld the ruling, prompting Mallory to come to the court earlier this year.

Mallory’s argument

Mallory argued in the Supreme Court brief that the Pennsylvania Supreme Court’s finding that the registration plan was unconstitutional was inconsistent with the “original public meaning” of the 14th Amendment — how the amendment would have been generally understood after it was ratified in 1868. In recent years, efforts to discern “original public meaning” have become increasingly important in constitutional interpretation. In 1868, Mallory asserted that all states require out-of-state corporations that want to do business in that state to consent to personal jurisdiction, even if those corporations cannot be sued in court in that state. Mallory added that around the same time, Congress passed a similar requirement for the District of Columbia.

Mallory also pointed to the Supreme Court’s 1917 decision Pennsylvania Fire Insurance Company or Philadelphia v.Gold Issuing Mining Company, arguing that the out-of-state corporation agreed to jurisdiction in Missouri, which, as required by state law, appointed an agent to receive “procedural service” — the legal document for filing a lawsuit.Supreme Court never overturned its decision Pennsylvania fireMallory wrote, there is no good reason to do so now.

Mallory rejects any claim that the court’s later ruling on personal jurisdiction somehow undermines the Pennsylvania fire. The Court’s 1945 Judgment International Footwear Company F.Washingtonarguing that a state can have jurisdiction over an out-of-state defendant when the defendant has sufficient ties to the state that it would not be unfair for the defendant to face a lawsuit in that state, simply “establishing an additional basis for jurisdiction over an out-of-state defendant.” judge in International Footwear Mallory emphasized that when the defendants agreed to jurisdiction, there was no weighing of the constitutionality of jurisdiction over out-of-state defendants. According to Mallory, Norfolk agreed to be governed in Pennsylvania under the state’s registration program.

Supreme Court decision of 1990 Burnham v Superior Court Mallory added that it also shows that Pennsylvania’s registered program is constitutional.exist burnham, the Supreme Court upheld “label jurisdiction” – the concept of exercising jurisdiction over out-of-state defendants who are served with suits while visiting the state.If the accused is burnham – A father from New Jersey – who could be sued based on a visit to California to visit his children, Mallory insisted that allowing Norfolk Southern to operate in Pennsylvania and have “thousands of miles of track” did nothing Injustice and a dozen facilities”, indicted in Pennsylvania.

Norfolk South’s argument

Norfolk Southern countered that Pennsylvania’s plan was “an anachronistic approach — developed at different times to solve a problem that no longer exists, based on theoretical foundations that disappeared decades ago.” In fact, it noted, Pennsylvania is the only state to use such a scheme, and even Pennsylvania has not defended it in this case. Norfolk Southern explained that until the 20th century, companies could avoid being sued for their activities in the states in which they did business unless states had laws requiring out-of-state companies to appoint agents to serve in litigation.but after International Footwearthe railroad went on to say, that such laws are no longer needed because state courts may have “specific” jurisdiction over out-of-state corporations — limited powers to hear claims arising out of corporations’ activities in the state.

but even if International Footwear no damage Pennsylvania fireNorfolk South told the judge, in Pennsylvania fire Still can’t save the Pennsylvania plan. Norfolk Southern and other out-of-state companies did not consent to jurisdiction in Pennsylvania simply by registering to do business in Pennsylvania, which is the reason for the railroad, because the registration process did not say anything about consent.

recent Supreme Court rulings Goodyear Dunlop Tire Business v. Brown and Daimler AG v. BaumannNorfolk Southern argues, also makes it clear that a state only has general jurisdiction over companies that are “at home” in that state.

Norfolk South disputed Mallory’s original views on the 14th Amendment, writing that “Mallory grossly misstates the law and practice of the ratification era.” Norfolk claims that, unlike Pennsylvania’s plan, The law that Mallory cites “overwhelmingly governed claims stemmed from” the business in the forum. Mallory could not point to any “decision to apply general registration jurisdiction prior to ratification, and a decision to do so over the next 28 years,” Norfolk South concluded.

The Biden administration submitted a letter of support for Norfolk South. It warned judges that if Mallory prevailed, state courts could also hear lawsuits stemming from foreign defendants’ conduct overseas — which the government believes could harm the federal government’s relationship with other countries.

This article was originally published on Howe on the Court.

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