In Cooper Tire & Rubber Co, v, McCall, No. S20G1368, 2021 Ga. LEXIS 626 (Cooper Tire), the Supreme Court of Georgia (Supreme Court) held that Georgia courts can exercise general personal jurisdiction over foreign corporations that are registered to do business in the state. In Cooper Tire, the plaintiff, Tyrance McCall, filed a lawsuit against Cooper Tire & Rubber Company (Cooper Tire) in Georgia state court for personal injuries he sustained in a car accident. Cooper Tire filed a motion to dismiss for lack of personal jurisdiction.
The 14th Amendment limits the personal jurisdiction of state and lower federal courts over non-resident defendants. Personal jurisdiction over a defendant is obtained through specific or general jurisdiction within the forum state. General jurisdiction is based on the defendant’s presence in the state. Specific jurisdiction is based on the defendant’s contacts on the state. In Cooper Tire, the Supreme Court considered whether it had jurisdiction over Cooper Tire based on Cooper Tire’s consent to general jurisdiction.
In its motion, Cooper Tire argued that Georgia courts lacked jurisdiction as it is a Delaware corporation that maintains its principal place of business in Ohio and it has only minimum contacts in Georgia. The trial court granted Cooper Tire’s motion to dismiss and the Court of Appeals of Georgia (Court of Appeals) reversed the decision, holding that Cooper Tire is subject to personal jurisdiction in Georgia because it is registered to do business in the state.
The Supreme Court granted certiorari and affirmed the decision of the Court of Appeals. In support of its holding, the Supreme Court declined to overrule its thirty-year precedent, as set forth in Allstate Insurance v. Klein, 422 S.E.2d 863 (Ga. 1992). In Klein, the court held that Georgia courts may exercise general personal jurisdiction over an out of state corporation that is authorized to do or transact business in Georgia at the time a claim arises. The court based its reasoning on its statutory definition of “non-resident.”
Under Georgia’s long arm statute, a non-resident is, in pertinent part, “a corporation which is not organized or existing under the laws of [the] state and is not authorized to do or transact business in Georgia at the time a claim or cause of action arises.” Ga. Code §9-10-90 (emphasis added). Importantly, the statutory definition of “non-resident” excludes corporations that are registered to do business in Georgia.
To analyze whether Georgia had jurisdiction over Cooper Tire, the court turned to the United States Supreme Court decision in Pennsylvania Fire Insurance Co. v. Gold Issue Mining & Milling Co., 243 U.S. 93 (1917). In Pennsylvania Fire Insurance Co., the Court held that a corporation consented to the jurisdiction of a state court by registering to do business in that state. Although the court acknowledged that recent United States Supreme Court decisions – holding that general jurisdiction is available over an out of state corporation only when its connections to the forum state are so continuous and systematic as to render it “at home,” Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017); Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011) – have limited the scope of general personal jurisdiction over foreign corporations, the court declined to follow those recent decisions. As noted by the court, the United States Supreme Court has not expressly overruled its decision in Pennsylvania Fire Insurance Co., which recognizes general jurisdiction by consent.
Cooper Tire establishes that an out of state corporation consents to being sued in Georgia when it registers to do business there. Many other states have taken positions that are more in line with recent United States Supreme Court precedent on whether a foreign corporation consents to general personal jurisdiction by registering to do business there. Subrogation professionals should keep this in mind when deciding where to file suit.