Supreme Court allows unusual Pennsylvania law on corporate suits

Supreme Court allows unusual Pennsylvania law on corporate suits

Supreme Court Pennsylvania law upheld As a condition of doing business in the state on Tuesday, corporations are required to consent to being sued – by anyone, anywhere – in its courts.

Only Pennsylvania has such a law. But the ruling could pave the way for other states to enact similar legislation, giving injured consumers, workers and others more options to sue, and allowing corporations to file lawsuits in courts that they consider unfair to business. may be considered hostile.

The Supreme Court was divided 5 to 4, with Justice Neil M. Gorsuch writing for the majority. Ruling against Norfolk Southern, the corporation at the center of the case, Justice Gorsuch rejected its argument that it was “entitled to a more favorable rule that it must also answer to its employees” under the Fourteenth Amendment.

In dissent, Justice Amy Coney Barrett, Chief Justice John G. Roberts Jr. and joined by Justices Elena Kagan and Brett M. Kavanaugh, wrote that Pennsylvania’s law unfairly harmed the rights of other states because it “imposed a broad claim of authority over disputes” with no connection to the Commonwealth. ”

The case was brought by Robert Mallory, who said he developed cancer after being exposed to toxic chemicals during his nearly two decades as a freight car mechanic in Virginia and Ohio for the Norfolk Southern Railway, which at the time was Virginia was involved. based there.

Mr. Mallory argued that his work included spraying boxcar pipes with asbestos and demolishing car interiors, which he claimed contained carcinogens. The question in the case was whether he could sue in a third state that had no substantive ties to the lawsuit: Pennsylvania.

The decision came after the derailment of a Norfolk Southern train carrying toxic chemicals near the Pennsylvania state line, further exacerbating matters. The fire broke out and raised fears of an explosion, prompting officials to burn some of the train’s dangerous cargo and raising concerns about the damage to public health and the environment.

threatened to derail decision on tuesday, Justice Gorsuch addressed this directly at the beginning of his opinion. He wrote, “Suppose an Ohio resident sued a train conductor for illness resulting from an accident. If a resident sued the conductor just over the border in Pennsylvania, all the judges would agree that a state court could hear the case. But Norfolk Southern had argued that it would be protected from that same scenario, Justice Gorsuch wrote.

Justice Gorsuch said, “Nothing in the Due Process Clause requires such a disproportionate result.”

The Supreme Court has long held that corporations can be sued where they are incorporated or where they are headquartered. And they can be prosecuted in special cases if the plaintiff’s claims are related to the defendant’s contacts with the state.

Mr. Mallory did not rely on any of these grounds for jurisdiction. Rather, he pointed to a Pennsylvania law that requires companies doing business in the state to consent to being sued there.

Explaining the historical background of the case, Mallory v Norfolk Southern RailwayNo. 21-1168, Justice Gorsuch spoke about the ways corporations have pushed back on where claims against them can be heard.

He wrote, “Unsurprisingly, corporations wherever they did business did not relish the prospect of going to court for any claims.”

Norfolk Southern has also promoted its business in Pennsylvania, he wrote. In his opinion, Justice Gorsuch a fact sheet is included by the company, which included a graphic chart with a yellow map of Pennsylvania outlining its “extensive network of tracks and terminals”.

In his dissent, Justice Barrett wrote that Pennsylvania’s claim of general jurisdiction over all corporations legally doing business in the state “confronts our precedent.”

He said, “Pennsylvania’s power grab violates much more than the defendants’ rights—it impedes the proper role of the states in our federal system.”

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