(Guest Post) The Supreme Court Continues Its Fractured Approach to Personal Jurisdiction

The following post is by Charles "Rocky" Rhodes (South Texas) and Cassandra Robertson (Case Western), who have been blogging about Mallory v. Northfolk Southern Railway.

Studying personal jurisdiction has long been how 1L’s learn the difference between plurality and majority opinions, and, as Justice Brennan used to say, the importance of counting to five votes. With Tuesday’s decision in Mallory v. Norfolk Southern Railway, that tradition will continue!

The Supreme Court ruled in favor of the plaintiff, who relied on Pennsylvania’s corporate registration jurisdiction-by-consent statute to sue the railway company in Pennsylvania. It was the second time in a row for a personal jurisdiction plaintiff to prevail in the Supreme Court after a string of six defense rulings, suggesting that the Court is looking for a more stable equilibrium in its personal jurisdiction jurisprudence. Here a century-old case proved the key. The Court relied on its venerable 1917 holding in Pennsylvania Fire Insurance Co. v. Gold Issue Mining & Milling Co., which held that a state’s jurisdictional assertion under a similar corporate registration statute for any claim did not violate due process.

But this victory for Mallory may be short lived. Justice Alito—the necessary fifth vote for holding the Due Process Clause was not violated—indicated in his concurrence in the judgment that the Pennsylvania statute likely violated the dormant Commerce Clause. He noted Pennsylvania had no state interest in this particular case because the plaintiff did not reside in Pennsylvania when the suit was filed, the harm did not occur in Pennsylvania, and Norfolk Southern was neither at home nor incorporated in Pennsylvania. Yet these concerns leave open the potential for state legislatures to adopt a sounder jurisdictional approach for corporations, avoiding the uncertainties of the outer limits of the minimum-contacts test.

The Plurality Opinion

Justice Gorsuch authored the part-majority, part-plurality opinion. In a footnote likely to be a life preserver for 1L students (unless edited out by casebook authors!), he quickly summarized the points on which five justices agreed:

“While various separate writings accompany this opinion, it should be apparent a majority of the Court today agrees that: Norfolk Southern consented to suit in Pennsylvania. Supra, at 10–11; post, at 2 (opinion of ALITO, J.). Pennsylvania Fire therefore controls this case. Supra, at 11–12; post, at 2–4 (opinion of ALITO, J.). Pennsylvania Fire’s rule for consent-based jurisdiction has not been overruled. Supra, at 13–14; post, at 4 (opinion of ALITO, J.). International Shoe governs where a defendant has not consented to exercise of jurisdiction. Supra, at 14–15; post, at 4 (opinion of ALITO, J.). Exercising jurisdiction here is hardly unfair. Supra, at 17–20; post, at 4–5 (opinion of ALITO, J.). The federalism concerns in our due process cases have applied only when a defendant has not consented. Supra, at 21; post, at 7–8 (opinion of ALITO, J.). Nor will this Court now overrule Pennsylvania Fire. Supra, at 21–23; post, at 4 (opinion of ALITO, J.).”

But, as this summary indicates, the portion of Justice Gorsuch’s opinion that is a majority is narrow; essentially, Pennsylvania Fire controls the Due Process Clause analysis for a state imposing consent to jurisdiction as a consequence for registration and International Shoe’s minimum-contacts test controls outside that context. The Court vacated the Pennsylvania Supreme Court’s judgment that the statute was unconstitutional under the Due Process Clause and remanded to allow consideration of the railroad’s alternative argument that Pennsylvania’s statutory scheme violated the dormant Commerce Clause.

In the sections for a plurality, Justice Gorsuch hinted at a broader reconfiguration of personal jurisdiction that continued the dialogue he started in his concurrence in Ford Motor Co. v. Montana Eighth Judicial District Court. He opened with a hypothetical based on the East Palestine, Ohio train derailment, with imagined suits filed in Pennsylvania against a Virginia train conductor served while in the state and against Norfolk Southern based on its consent to jurisdiction through registration in the state. Because the Due Process Clause would not bar a suit against the conductor, the railroad, according to Justice Gorsuch, should be treated the same.

At the founding and through the time of the Fourteenth Amendment’s adoption, “a tribunal’s competence was generally constrained only by the ‘territorial limits’ of the sovereign that created it.” This meant that, in transitory actions against an individual defendant, suit could be maintained on any claim at any place the defendant could be found. Today, this jurisdictional basis is often known as “tag” jurisdiction; the Court unanimously affirmed (although in fractured opinions) its continued propriety in 1990 in Burnham v. Superior Court of California.

But, the plurality’s jurisdictional historical tale continued, the difficulty was adapting the traditional rule about transitory actions against individuals to corporate artificial persons created by law. States did so, both before and after the Fourteenth Amendment’s ratification, by adopting “statutes requiring out-of-state corporations to consent to in-state suits in exchange for the rights to exploit the local market and to receive the full range of benefits enjoyed by in-state corporations.” Although these statutes took various forms, some authorized the state to assert jurisdiction over any claim—irrespective of any relationship to the forum—against a corporation appointing an agent for service of process under a state corporate registration scheme. When a constitutional challenge to one of these statutes came before the Court in 1917, Justice Holmes’ unanimous Pennsylvania Fire opinion succinctly dismissed any due process concerns.

The plurality then explained its refusal to overrule Pennsylvania Fire. International Shoe and its progeny did not undermine Pennsylvania Fire; those cases “stake[d] out an additional road to jurisdiction” over nonconsenting out-of-state corporations but did not impact the permissibility of jurisdiction through consent. The Pennsylvania statutory scheme fell within the “variety of actions” by a defendant that may amount to a legal submission to a court’s jurisdiction. And there was no unfairness here, especially as Norfolk Southern undertook extensive and substantial in-state activities and managed more miles of track in Pennsylvania than in any other state.

Counting Votes

The four separate writings showed many of the same divisions that arose during the oral argument. 

Justice Jackson fully joined the plurality opinion and added an additional concurrence, focusing on the ways in which personal jurisdiction can be waived: “by explicitly or implicitly consenting to litigate future disputes in a particular State’s courts,” by “fail[ing] to follow specific procedural rules” and thus “waiving the right to object to personal jurisdiction as a consequence,” and by “voluntarily invok[ing] certain benefits from a State that are conditioned on submitting to the State’s jurisdiction.”

Justice Alito, by contrast, joined only part of Justice Gorsuch’s opinion. He did not join Part II, which largely set out the history of personal jurisdiction and registration statutes at the time of Pennsylvania Fire. He also did not join Part III-A, which set out the procedural history of Pennsylvania Fire and the Court’s decision in that case. And he did not join Part IV, which concluded that Norfolk Southern’s extensive Pennsylvania contacts supported the “fair play and substantial justice” analysis in personal jurisdiction.

Justice Alito differed most from the plurality regarding whether the state could exercise jurisdiction over a case in which the state has no “legitimate local interest.” Our amicus brief made largely the same point, as we discussed in an earlier post. However, Justice Alito’s view is that the potential lack of a state interest isn’t a personal jurisdiction/due process problem; instead, it’s a dormant Commerce Clause problem. Because the state-interest point wasn’t well developed in the record, and the Pennsylvania Supreme Court had not reached the dormant Commerce Clause issue, Justice Alito supported remanding the case for determination of that question. He expressed serious doubt that the state could hear the case, writing that he was “hard-pressed to identify any legitimate local interest that is advanced by requiring an out-of-state company to defend a suit brought by an out-of-state plaintiff on claims wholly unconnected to the forum State,” and that “even if some legitimate local interest could be identified, I am skeptical that any local benefits of the State’s assertion of jurisdiction in these circumstances could overcome the serious burdens on interstate commerce that it imposes.” The question of state interest will likely be a focal point of the proceedings on remand under the dormant Commerce Clause.

Finally, Justice Barrett dissented, joined by the unusual line-up of Roberts, Kagan, and Kavanaugh. These justices would have completely jettisoned jurisdictional consent by registration, relying predominantly on the Roberts Court’s recent decisions. Interestingly, two of the dissenting justices—Barrett and Kagan—both taught Civil Procedure before taking the bench.

The Future of Personal Jurisdiction

What does the future hold for personal jurisdiction?

First and foremost, the opinion leaves room for the states—and especially state legislatures—to adopt jurisdictional rules that reflect state policy. After Mallory, both the business-interest and plaintiffs’ constituencies have an incentive to negotiate those policies. The broad sweep of the plurality opinion creates an opening for states to return to open-ended jurisdiction based on state registration. At the same time, Justice Alito’s warning about potential Commerce Clause violations suggest that a state’s attempt to exercise jurisdiction in a case wholly unconnected with the state might be vulnerable on other grounds. Several years ago, we drafted a model consent-by-registration statute that offered a middle ground, giving rise to jurisdiction only in cases where there was a significant state interest. After the decision in Mallory, we think that the case is even stronger for the states to adopt a narrowly focused statute that explicitly sets out the consequences of registration. Such a statute would offer predictability, would avoid a significant amount of jurisdictional litigation, and would avoid the worst excesses of either too-broad or too-narrow state jurisdiction.

The case also highlights the impact of methodological divides on jurisdictional doctrine. Justice Gorsuch’s plurality opinion is predominantly originalist. Because the states had similar statutory schemes before and at the time of the ratification of the Fourteenth Amendment, and those schemes were upheld some fifty years later in Pennsylvania Fire, the Due Process Clause was not violated. The plurality largely ignores the new jurisdictional constraints announced by the Roberts Court over the last dozen years, viewing those as irrelevant when the asserted jurisdictional basis is a type of consent, a traditional form outside the minimum-contacts test. But while clothing its opinion in originalist garb, the plurality indicates a functional disagreement with the premises underlying the Roberts Court’s restrictive turn in personal jurisdiction.

In contrast, the dissent relies primarily on doctrinal arguments, reasoning from the contours of its past decisions. The dissent fears that the recent constraints on a corporation’s amenability to suit would be for naught if states could circumvent those limits by requiring corporations to consent to all-purpose jurisdiction to do business in the state. As a result, the dissent seeks to eliminate corporate registration schemes as a jurisdictional alternative.

Such interpretive divides typically lead to highly fractured decisions, which has been a problem in the past in personal jurisdiction and appears likely to be a continuing difficulty. While the Roberts Court issued a majority opinion in six of its seven prior jurisdictional rulings, those days may be coming to an end. Justice Breyer’s replacement by Justice Jackson, and Justice Gorsuch and Thomas championing an originalist approach, provide three additional voices to Justice Sotomayor’s fight against the restrictive turn in personal jurisdiction. It appears that, at least for the foreseeable future, the study of personal jurisdiction will remain the 1L subject demonstrating the importance of plurality opinions and counting votes.