The Philadelphia Court of Common Pleas today, in the wake of motions filed by the Firm, dismissed in full complaints filed against the Firm’s clients, Ashland Inc. and Univar USA Inc., on the basis that Pennsylvania had no personal jurisdiction over them. The Court agreed with the Firm’s argument that the Due Process Clause of the Fourteenth Amendment does not permit Pennsylvania state courts to assert general personal jurisdiction over out-of-state corporations, even where those corporations are registered to do business in Pennsylvania. This is the first ruling of its kind in the Philadelphia Court of Common Pleas.
A Pennsylvania statute provides that, in order to do business in Pennsylvania, all out-of-state corporations must first file a foreign registration statement, and a separate statute says that by filing such a statement, out-of-state corporations submit themselves to general personal jurisdiction in Pennsylvania. The Firm had previously argued on behalf of its clients that recent landmark Supreme Court decisions Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (2011) and Daimler AG v. Bauman, 134 S. Ct. 746 (2014) rendered these statutes unconstitutional (at least in part), because those cases held that out-of-state corporations could only be haled into court in Pennsylvania on general personal jurisdiction grounds in the most “exceptional circumstances.”
While the Philadelphia Court of Common Pleas initially did not credit this argument, it later ordered a hearing to address the issue, in light of even more recent Supreme Court rulings in BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549 (2017) and Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco Cty., 137 S. Ct. 1773 (2017), which solidified and clarified the holdings in Goodyear and Daimler.
At the hearing, Fishkin Lucks took the lead, arguing on behalf of nine corporate defendants that BNSF and Bristol-Myers made clear that Pennsylvania could not assert general personal jurisdiction over out-of-state corporate defendants–regardless of whether they had registered to do business in Pennsylvania–absent “exceptional circumstances” that plainly did not exist in this case. The Court agreed, dismissing not only all claims against the Firm’s clients but also all claims against all other out-of-state corporate defendants. This decision will fundamentally change the landscape of litigation in Pennsylvania, and more specifically, Philadelphia, as plaintiffs will be significantly inhibited from subjecting out-of-state corporations to the jurisdiction of the State’s courts.
