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  • Writer's picturePaul Peter Nicolai

Supreme Court Says Business Registration Subjects Out-of-State Companies Personal JurisdiCTION

Updated: Sep 15, 2023

The Supreme Court ruled that a company's decision to register for business in Pennsylvania is consent to general personal jurisdiction in the state. This decision has broad implications for companies that register in Pennsylvania and invites other states to create statutory schemes in line with Pennsylvania's.

In Pennsylvania, foreign corporations may only do business if they register with the Commonwealth. Pennsylvania's long-arm statute says registration as a foreign corporation submits the corporation to general personal jurisdiction. For decades Pennsylvania has been fertile ground for plaintiffs' lawyers who preferred to litigate there, even though the matter might have had no connection with the state.

That changed in December 2021, when the Pennsylvania Supreme Court decided that Pennsylvania's statutory scheme was unconstitutional to the extent that it confers upon Pennsylvania courts general jurisdiction over foreign corporations that are not home in Pennsylvania.

The Supreme Court reversed the state court decision, stating that an out-of-state plaintiff could sue the company on an out-of-state contract because it agreed to accept service of process in Pennsylvania. An out-of-state corporation that has consented to in-state suits to do business in the forum is susceptible to suit there.

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