Is Qualification to Transact Business A Consent to General Jurisdiction? This Court Answered “No”

Is Qualification to Transact Business A Consent to General Jurisdiction? This Court Answered “No”

      As mentioned in a posting I made on January 18, there is an ongoing debate as to whether qualification to transact business in a foreign jurisdiction constitutes consent to general jurisdiction in that foreign state. In that posting, I discussed the recent decision rendered in American Dairy Queen Corporation v. W. B. Mason Co., 2018 WL 135699 (D. Minn. Jan. 8, 2019), wherein it was held that qualification constituted consent. HERE IS A LINK to that posting.

      Last week, a New York appellate court considered the same question and came to the opposite answer. That court, while recognizing that there is New York law to the effect that qualification is consent, recognized as well that law predates the decision of the US Supreme Court in Daimler AG v. Bauman, 571 U.S. 117 (2014). Looking at the question anew in light of the Supreme Court’'s guidance with respect to general jurisdiction, the court in Aybar v. Aybar, 2019 N.Y. Slip Op. 00412, 2019 WL 288307 (App. Div. 2^nd Dept. Jan. 23, 2019) wrote:

We conclude that a corporate defendant's registration to do business in New York and designation of the Secretary of State to accept service of process in New York does not constitute consent by the corporation to submit to the general jurisdiction of New York for causes of action that are unrelated to the corporation’s affiliations with New York. 2019 WL 288307, * 8

      So there you have it. On essentially the exact same question, different courts are coming to diametrically opposed answers. At some juncture the US Supreme Court is going to need to step in and answer this question. At the same time, they are going to need to address statutes such as those of Pennsylvania which require a consent to jurisdiction in order to qualify.