As Jim Beck (of the Drug and Device Law Blog) and Michelle Cheng explain in a recent Washington Legal Foundation Legal Backgrounder, "The Other Shoe Drops on General Jurisdiction: Making the Most of Supreme Court’s Bauman & Goodyear Rulings," corporate defendants might want to think twice before making a general appearance in new cases filed in states other than the states in which they have incorporated or have located their principal place of business.
In short, doing business in all 50 states no longer necessarily subjects a corporation to suit in all 50 states, and International Shoe v. Washington, 326 U.S. 310 (1945) is not the last word on general jurisdiction. Based on the Supreme Court’s 2011 decision in Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (2011), and this term’s Daimler AG v. Bauman, 134 S. Ct. 746 (2014), “general” personal jurisdiction has been limited, and should no longer be assumed to support jurisdiction over a non-resident corporation—even one engaged in substantial, continuous and systematic business. These recent decisions establish that general personal jurisdiction can be asserted against corporations only in three limited circumstances: (1) the corporate defendant’s state of incorporation, (2) its principal place of business, or (3) “in an exceptional case” where the corporation’s in-state activities are “so substantial and of such a nature as to render the corporation at home in that State.”
Specific personal jurisdiction may still exist based on corporate activities related to a particular resident plaintiff, but this newly defined general personal jurisdiction standard bodes well for corporate defendants who would like to limit forum shopping but often are forced to litigate in other states against non-resident plaintiffs, merely because their products or services enter the “stream of commerce” within that state. As a result, when new lawsuits are filed by non-resident plaintiffs in states other than the state of incorporation and the state of the principal place of business, corporate defendants may wish to dust off procedural options many have not used for some time, like FRCP 12(b)(2) motions to dismiss for lack of personal jurisdiction, or state court motions to quash.