Georgia (For Now) Resists The Latest Trend in Personal Jurisdiction

GA State Court

In recent years, the United States Supreme Court has taken steps to limit the jurisdictional reach of state courts. For now, the Georgia courts are resisting that trend.

In several recent cases, the United States Supreme Court has limited the reach of “general” personal jurisdiction. Daimler AG v. Bauman, 134 S.Ct. 746 (2014); Bristol-Myers Squibb Co. v. Superior Court, 137 S.Ct. 1773 (2017). Specific personal jurisdiction exists when an out-of-state defendant purposefully directs activities towards an in-state resident and those activities give rise to the claims at issue in the lawsuit. General personal jurisdiction exists when an out-of-state defendant has so many contacts with the forum state that it should be treated as a resident. If a business is subject to general jurisdiction, it can be sued on any cause of action, even one that did not arise in the forum state.

In these recent cases, the United States Supreme Court has held that Due Process considerations limit the scope of general jurisdiction. Now, having an office or regular sales in the forum state were not enough to allow the exercise of general jurisdiction. General jurisdiction exists over a nonresident corporation only if it is incorporated in the forum state or has its principal place of business in the forum state. This severely limits the scope of general personal jurisdiction.

This line of cases has raised the question of whether a state court can exercise general personal jurisdiction over a corporation that is not incorporated in the state and does not have its principal place of business in the state, but has registered to do business in that state. In recent cases, various state courts have looked at the recent Supreme Court precedents and concluded that registration by a foreign corporation is not a consent to the exercise of general personal jurisdiction. See Aybar v. Aybar, 93 N.Y.S.3d 159 (2d Dep’t 2019).

The Georgia Court of Appeals confronted this issue of consent to general jurisdiction by registration in McCall v. Cooper Tire & Rubber Co., Case No. A20A0933 (decided June 1, 2020). In that case, the Georgia Court of Appeals, relying upon a 1992 decision of the Georgia Supreme Court, held that under Georgia’s Long Arm Statute, a business that has registered to do business in Georgia must be treated as a resident for purposes of personal jurisdiction. Therefore, a corporation that registers to do business in Georgia is subject to the general jurisdiction of Georgia courts.

The McCall decision does not address the Due Process issues behind the newer limits on general personal jurisdiction. But, the McCall decision puts Georgia courts at odds with the trend of the law in personal jurisdiction. This issue will return, perhaps on review of the McCall decision by the Georgia Supreme Court.

The opinion is available here.

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