The Supreme Court of Missouri recently issued an important decision in Norfolk Southern Railway Co. v. Dolan, holding that Missouri did not have personal jurisdiction over an out-of-state corporation registered to do business in Missouri that was conducting “substantial and continuous” business in Missouri, where an alleged injury to a resident of another state arose due to conduct outside of Missouri.
Russell Parker, a resident of Indiana, filed a personal injury lawsuit under the Federal Employer’s Liability Act (“FELA”) in St. Louis County against Norfolk, a Virginia corporation with its principal place of business in Virginia. Parker alleged he was injured in Indiana as a result of his work for Norfolk in that state. Parker never worked for Norfolk in Missouri, nor did he allege conduct in Missouri by Norfolk that caused his injury. Norfolk had registered with Missouri and designated an agent to receive service of process. Norfolk had also been sued and brought suit previously in Missouri, but only for matters arising from or related to its activities in Missouri.
Norfolk moved to dismiss for a lack of personal jurisdiction, which the trial court overruled. The Missouri Court of Appeals denied Norfolk’s petition for a writ of prohibition or, in the alternative, a writ of mandamus. After Norfolk sought relief in the Supreme Court of Missouri, it issued a preliminary writ of prohibition, which it later made permanent, rejecting Parker’s arguments that Missouri had either general or specific personal jurisdiction over Norfolk.
The Dolan court held that Missouri lacked general personal jurisdiction over Norfolk. Norfolk was not incorporated in Missouri and did not have its principal place of business in Missouri. The fact that Norfolk’s Missouri business amounted to “about 2 percent of its total business” did not make this the type of “exceptional case when [Norfolk’s] contacts with Missouri are so extensive and all-encompassing that Missouri, in effect, becomes another home state.” The Dolan court rejected Parker’s argument that Norfolk’s “continuous and systematic” business in Missouri supports general jurisdiction over it “even for cases not arising from its activities in Missouri,” explaining that is no longer a “valid argument” after the United States Supreme Court’s decision in Daimler AG v. Bauman, 134 S. Ct. 746 (2014).
The Supreme Court of Missouri in Dolan additionally rejected the argument that Missouri had specific personal jurisdiction over Norfolk. Parker argued, inter alia, that the railroad business conducted by Norfolk in Indiana, the basis of Parker’s injuries, arose from or was related to the same “type” of activity as Norfolk’s railroad business in Missouri. The Court explained:
To say this same conduct confers specific jurisdiction over suits the facts of which have no relationship to the forum state would be to turn specific jurisdiction on its head. There would never be a need to discuss general jurisdiction, for every state would have specific jurisdiction over every national business corporation.
The Dolan court also disagreed with Parker’s view that FELA provided an independent ground for jurisdiction in state courts that do not otherwise have personal jurisdiction over a defendant.
Finally, the court held that Norfolk did not impliedly consent to general personal jurisdiction by complying with Missouri’s foreign corporation registration statutes. The statutes’ “plain language” do not “mention consent to personal jurisdiction for unrelated claims” or provide an “independent basis for jurisdiction over foreign corporations that register in Missouri.”
In sum, corporations that are not based in Missouri but are sued in Missouri for activity arising outside the state should keep in mind Dolan and its implications for personal jurisdiction. For additional information, please contact Michael Klebanov or Joe Orlet.