July 6, 2023
Law360
A unique and explicit consent-by-registration statute in Pennsylvania - requiring corporations conducting business in the Commonwealth consent to being sued there - was upheld by the U.S. Supreme Court on June 27, 2023.
In a new article for Law360, Partner David Cheifetz discussed the ruling in Mallory v. Norfolk Southern Railway Co. and addressed its potential impact on corporate litigation for companies with interstate operations.
David says, “[t]he decision has major implications and is likely to create great uncertainty for large corporations, which often register to do business if many, if not all, 50 states. But following Mallory, the issue of consent by registration will probably reflect a varied state-by-state approach, which likely motivated at least some of the judges in the majority to vote the way they did.”
He observed the court’s majority noted some states may take the policy choice not to be hostile to outside business interests by passing such statutes, while other states may not want to subject their already overburdened courts to all kinds of litigation in which the state may not have an interest.
David continued, “[w]hile still others may want to provide an open forum to redress harms caused to their citizens, or even noncitizens, by corporations with a substantial business presence there. Corporations will therefore need to keep a close eye on legal developments in the various states in which they are registered to do business, at least until there is a more definitive nationwide resolution by the Supreme Court finding consent by registration statutes to be unconstitutional.”
Read the full article here. (Subscription Required)
July 6, 2023
Law360
A unique and explicit consent-by-registration statute in Pennsylvania - requiring corporations conducting business in the Commonwealth consent to being sued there - was upheld by the U.S. Supreme Court on June 27, 2023.
In a new article for Law360, Partner David Cheifetz discussed the ruling in Mallory v. Norfolk Southern Railway Co. and addressed its potential impact on corporate litigation for companies with interstate operations.
David says, “[t]he decision has major implications and is likely to create great uncertainty for large corporations, which often register to do business if many, if not all, 50 states. But following Mallory, the issue of consent by registration will probably reflect a varied state-by-state approach, which likely motivated at least some of the judges in the majority to vote the way they did.”
He observed the court’s majority noted some states may take the policy choice not to be hostile to outside business interests by passing such statutes, while other states may not want to subject their already overburdened courts to all kinds of litigation in which the state may not have an interest.
David continued, “[w]hile still others may want to provide an open forum to redress harms caused to their citizens, or even noncitizens, by corporations with a substantial business presence there. Corporations will therefore need to keep a close eye on legal developments in the various states in which they are registered to do business, at least until there is a more definitive nationwide resolution by the Supreme Court finding consent by registration statutes to be unconstitutional.”
Read the full article here. (Subscription Required)
