What are the jurisdictional consequences of registering as a foreign corporation in a state where a corporation would like to conduct business? If, for example, a California corporation registers to do business in Pennsylvania, is it subject to suit in Pennsylvania by a New York resident based on conduct that occurred in New Jersey? Under specific personal jurisdiction analysis, the answer is clearly no. But is there an argument that the corporation is subject to general personal jurisdiction, making it susceptible to suit in Pennsylvania despite the lack of any connection between the dispute and the commonwealth? Surprisingly, despite a 2014 pronouncement from the U.S. Supreme Court narrowing the scope of general personal jurisdiction, case law continues to support jurisdiction based solely on the act of registering to do business in a number of states, including Pennsylvania, New York and Delaware.
On Jan. 14, 2014, the U.S. Supreme Court issued its opinion in Daimler AG v. Bauman, 134 S.Ct. 746 (2014), clarifying the bounds of a court’s ability to exercise general, “all purpose” jurisdiction over a foreign corporation, when the dispute involves no connection to the forum state. The Supreme Court held that the test for general jurisdiction is not simply whether a corporation conducts “continuous and systematic” activity within the forum state, but rather, “whether the corporation’s affiliations with the state are so ‘continuous and systematic’ as to render it essentially at home in the forum state.” The court identified a corporation’s principal place of business as well its state of incorporation as the paradigmatic examples of where a corporation may be considered “at home.” The court left open the possibility for exceptional circumstances in which a corporation could be considered “at home” elsewhere, but implied that only activity of a character substantially equivalent to a corporation’s principal place of business would suffice. Numerous commentators have recognized this decision as a significant restriction on forum-shopping, particularly when litigating against large corporations that do substantial business throughout the country.
