Missouri Supreme Court Tightens the Reins on Personal Jurisdiction
State ex rel. Norfolk Southern Railway Company v. The Honorable Colleen Dolan, 2017 WL 770977, No. SC95514 (February 28, 2017)
In a recent opinion, the Missouri Supreme Court continued the U.S. Supreme Court’s trend toward limiting personal jurisdiction over a non-resident defendant.1 In State ex rel. Norfolk Southern Railway Co. v. Dolan, the Court held Norfolk’s substantial and continuous business in the state of Missouri was insufficient to establish general personal jurisdiction over Norfolk.
Plaintiff Russell Parker, an Indiana resident, filed suit in St. Louis County against his employer, Norfolk, pursuant to the Federal Employer’s Liability Act. Norfolk is a Virginia corporation with its principal place of business in Virginia. Plaintiff alleged cumulative trauma injury sustained over the course of his years of employment with Norfolk, all occurring in Indiana. Plaintiff never worked for Norfolk in Missouri.
Noting there seems to be continued confusion regarding how personal jurisdiction may be established, the Supreme Court explained that personal jurisdiction over a corporation may be general (when a state exercises jurisdiction over a defendant in a suit not arising out of or related to the defendant’s contacts with the state) or specific (when the suit arises out of or relates to the defendant’s contacts with the forum).
The Court also explained that a court normally may exercise general jurisdiction over a corporation only when the corporation’s place of incorporation or its principal place of business is in the forum state. In “exceptional cases,” however, general jurisdiction may be found to exist if the corporation’s activities in that other state are “so substantial and of such a nature as to render the corporation at home in that State.”
In an effort to show Norfolk conducted continuous and systematic business in Missouri, the Plaintiff presented evidence that Norfolk owns or operates approximately 400 miles of track in the state of Missouri, generates approximately $232 million in revenue, employs approximately 590 people in Missouri, and has a registered agent in the state. However, these numbers represent only about 2% of its total tracks across the country, its total revenue, and its total workforce. Norfolk generates greater revenue in 11 other states, has track in 22 states and has more employees in 13 other states.
Based on this evidence, the Court held Norfolk’s contacts are insufficient to establish general jurisdiction over Norfolk in Missouri. While in “exceptional cases” a state may have general jurisdiction over a corporation neither incorporated nor operating its principal place of business there, such exceptional cases only exist where the forum state can be said to be a surrogate for the place of incorporation or the home office, such that the corporation is essentially at home in that state. Citing to cases from the U.S. Supreme Court, the Court noted this showing requires apprising in their entirety the corporation’s activities in the forum state and its activities in other states and countries. Being “essentially at home” in a state is not the same as “doing business” in a state, such that mere contacts, no matter how systematic and continuous, are unlikely to support an “exceptional case” in and of themselves.
As to specific jurisdiction, the Court emphasized that it requires consideration of the relationship between the defendant, the forum, and the litigation. The Court noted that, while Norfolk had purposefully availed itself of the opportunity to do business in Missouri, it would be subject to specific jurisdiction in Missouri on that basis only as to claims that are related to business contacts it has made in the state. The suit at issue, however, was unrelated to its Missouri contacts so it can be brought only if Missouri has general jurisdiction over Norfolk. That Norfolk engages in its railroad business in Missouri and the alleged injuries arose from the railroad business it conducts in Indiana is insufficient. There is no support for the notion that if a company is a national company that does the same “type” of business in the forum state, then essentially it can be used anywhere, otherwise the notion of specific versus general jurisdiction would be rendered meaningless.
Finally, the Court rejected the notion that Norfolk consented to personal jurisdiction over any case filed in Missouri by complying with Missouri’s foreign corporation registration statute. A broad inference of consent based on registration would allow national corporations to be sued in every state and, again, render the notion of specific versus general jurisdiction pointless.
1. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S.Ct. 2846 (2011); J. McIntyre Machinery Ltd. v. Nicastro, 131 S.Ct. 2780 (2011); Daimler AG v. Bauman, 1345 S.Ct. 746 (2014); and Walden v. Fiore, 134 S.Ct. 1115 (2014).
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