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Pennsylvania jurisdiction over out-of-state corporations may be up in the air

Screenshot 2019 02 26 at 9.32.37 AM - Pennsylvania jurisdiction over out-of-state corporations may be up in the air

Not long ago, it seemed clear that if an out-of-state corporation had registered to do business in Pennsylvania, a Pennsylvania court could exercise personal jurisdiction over it by the doctrine of consent. That may now be up in the air. A Pennsylvania Superior Court opinion that found such jurisdiction, Murray v. American LaFrance, 2018 WL 4571804 (Pa. Super., Sept. 25, 2018), has been withdrawn and is waiting for reargument before a nine judge en banc panel of that Court.

Until and unless the Superior Court reverses Murray, the current law is still that registration is consent to jurisdiction, as held in Webb-Benjamin v. International Rug Group, 192 A.3d 1133 (Pa. Super., 2018). And federal courts in Pennsylvania are still finding jurisdiction from registering to do business. One such recent opinion out of Philadelphia is Youse & Youse v. Johnson & Johnson, 2019 WL 233884 (U.S.D.C., E.D. Pa., Jan. 16, 2019).

In addition to finding jurisdiction by consent over out-of-state corporations by registering to do business, jurisdiction has been found by a corporation’s relevant actions in Pennsylvania. Adding to the overall jurisdictional uncertainty is that a recent Superior Court opinion on this ground of personal jurisdiction, Hammons v. Ethicon, 190 A.3d 1248 (Pa. Super., June 19, 2018), is now awaiting a decision from the Pennsylvania Supreme Court whether or not that Court will grant its petition for allowance of appeal. Hammons found jurisdiction by activities in Pennsylvania by the out-of-state corporation, including supervising the design and manufacturing process of the product in Pennsylvania in collaboration with a Pennsylvania company and working closely with a Pennsylvania physician in developing the product.

Hammons is interesting beyond its discussion of jurisdiction. The case is an appeal from a $12 million pelvic mesh verdict against Johnson & Johnson. The record on the petition for allowance of appeal is sealed. What could be the reason for sealing this record? Only the Court knows.

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