On June 27, 2023, the United States Supreme Court decided Mallory v. Norfolk Southern Railway Co., 2023 WL 4187749, 600 U.S. ___ (June 27, 2023), a decision that likely will reinvigorate forum-shopping efforts by plaintiffs in the Commonwealth of Pennsylvania and possibly elsewhere. The decision—supported by a plurality of Justices and the concurrence of Justice Alito—upholds a Pennsylvania law that requires out-of-state corporations registering to do business in Pennsylvania to consent to general personal jurisdiction within the Commonwealth. Overlooking decades of personal jurisdiction jurisprudence, Mallory reinstates a form of personal jurisdiction previously cast by many courts as a dead letter: general jurisdiction by statutory “consent.”
Specific personal jurisdiction can be a very straightforward concept. If a plaintiff claims to have been injured by a product that the defendant itself sold directly to plaintiff at a store within the forum state, disputes over specific personal jurisdiction would be rare. Other cases can be closer calls, particularly when a defendant has extensive contacts within a forum but none of them are causally related to the plaintiff’s claims. At what point does a defendant’s purposeful availment of a forum cease to be “related to” a plaintiff’s claims? The Ninth Circuit offered some helpful guidance on that issue in its decision in Yamashita v. LG Chem, Ltd., — F.4th —, 2023 WL 2374776 (9th Cir. Mar. 6, 2023).
Plaintiff in Yamashita was a Hawaii resident who brought a personal injury/products liability suit in Hawaii state court. The suit named two defendants. The first was a South Korean company that manufactured a battery that Plaintiff alleged had caused him injury. The second, which was a wholly owned subsidiary of the South Korean company, was a Delaware corporation with its principal place of business in Georgia. It did not manufacture the product at issue but distributed it within the United States. Both defendants denied ever selling the product directly to individual consumers. The defendants removed the case to the District Court for the District of Hawaii and moved to dismiss for lack of personal jurisdiction. The district court granted the motion, and Plaintiff appealed.
As we ring in the new year, it is time once again to reflect on some of the most significant legal developments for drug and device companies this year. The list below is by no means exhaustive (who could forget the Rule 702 updates that took place this year, which will carry over into 2023?), but provides a brief recap and assessment of five of the most interesting and consequential developments affecting drug and device law in 2022.
The United States Supreme Court will soon consider whether the due process clause of the Fourteenth Amendment prohibits a state from requiring that a corporation consent to personal jurisdiction in order to conduct business there.
The question arises from a Pennsylvania Supreme Court case, Mallory v. Norfolk Southern Railroad Co., 266 A.3d 542 (Pa. 2021), which we wrote about here. In Mallory, plaintiff Robert Mallory attempted to hold the Norfolk Southern Railway Co. liable for the colon cancer he allegedly developed after being exposed to chemicals during the two decades that he worked for the railroad in Virginia and Ohio.
A recent Pennsylvania Supreme Court opinion provides out-of-state corporations more protection from litigation tourists, bringing the state’s general personal jurisdiction rules in line with U.S. Supreme Court precedent. In Mallory v. Norfolk Southern Railway Co., a unanimous court invalidated part of Pennsylvania’s corporate registration statute, holding that corporations that are not incorporated and do not have a principal place of business in Pennsylvania cannot be subject to general personal jurisdiction simply because they have registered to conduct business in the Commonwealth.
The New Jersey Appellate Division has held that Korean company LG Chem Ltd. (“LG Chem”)will have another opportunity to dispute New Jersey’s jurisdiction over it in a product liability lawsuit concerning a vaping device battery. The decision is based, in part, on the trial court’s failure to order jurisdictional discovery and convene an evidentiary hearing to resolve the disputed jurisdictional allegations before deciding LG Chem’s pre-answer motion to dismiss. This case underscores that in New Jersey, the standard governing motions to dismiss for lack of jurisdiction, unlike other bases, requires the court to look outside the disputed pleadings alone.
The New Jersey plaintiff alleged he was injured when a lithium-ion battery manufactured by LG Chem exploded in his pocket. Plaintiff attempted to serve process on LG Chem through two of its U.S.-based subsidiaries, LG Chem America, Inc. (LGCAI) and LG Chem Michigan, Inc. (LGCMI). The agents of both refused to accept service.