For many years, a business could be sued in Pennsylvania courts by the mere fact that the company registered to do business in Pennsylvania. In what is sure to strike a blow against “litigation tourism,” the Pennsylvania Supreme Court has declared that the Pennsylvania statute that allowed such expansive jurisdiction “clearly, palpably, and plainly violates the Constitution.”
Litigation tourism is when out of state plaintiffs sue in Pennsylvania, particularly in Philadelphia, because they hope for a jackpot verdict. Any company doing business in the Commonwealth has had to register with the state to do so, thus subjecting them to the jurisdiction of the Pennsylvania courts and suits from out of state plaintiffs. However, the United States Supreme Court has consistently held that to be sued in any state, the business must be either “at home” in the state, incorporated in the state, or has established its principal place of business in the state.
In Mallory v. Norfolk Southern, the Pennsylvania Supreme Court was presented with a case in which it could no longer ignore the due process requirements enunciated by the U.S. Supreme Court. Now any plaintiff, whether residing in Pennsylvania or outside of Pennsylvania, will have to make sure that the company they sue in the Commonwealth meets the requirements of being “at home,” incorporated in the state, or has its principal place of business here. For more on the Mallory opinion, please click here.