According to Pennsylvania statute, out-of-state corporations that register to do business in Pennsylvania (which they must do if they wish to conduct business in the Commonwealth) consent to general personal jurisdiction in Pennsylvania. Relying on this statute and appellate authority applying it, the Honorable Berle M. Schiller of the United States District Court for the Eastern District of Pennsylvania  recently held that the Court could exercise general personal jurisdiction over a foreign airline in a case in which a passenger alleged that she was injured on a flight that had no connection to Pennsylvania.

In Diab v. British Airways, PLC, the plaintiff was a passenger on a British Airways flight from New York to London. The plaintiff suffered injuries when the flight encountered “severe and extreme turbulence.” The plaintiff brought a Montreal Convention claim against British Airways in federal court in Philadelphia, and the airline moved to dismiss for lack of personal jurisdiction.

Joining a number of other district courts that have reached the same conclusion, Judge Schiller first held that although Article 33 of the Montreal Convention provides courts with subject matter jurisdiction over claims arising under the Convention, it does not provide courts with personal jurisdiction over carriers. A passenger who pleads an otherwise viable claim under the Convention still must establish, under the law of the state in which the passenger filed suit, that the court may exercise personal jurisdiction over the airline.

Turning to state law, Judge Schiller explained that pursuant to Pennsylvania statute (42 Pa. C.S. § 5301 (a)(2)(ii)), out-of-state corporations that register to do business in Pennsylvania consent to general personal jurisdiction in Pennsylvania. The Judge also observed that, in the 1991 case Bane v. Netlink, Inc., the United States Court of Appeals for the Third Circuit applied the statute to conclude that an out-of-state corporation that had registered to do business in Pennsylvania was subject to general personal jurisdiction in the Commonwealth. Because British Airways had registered to do business in Pennsylvania, Judge Schiller concluded that the Court could exercise general personal jurisdiction over the airline.

Judge Schiller acknowledged that district courts in Pennsylvania disagree as to whether the United States Supreme Court's 2014 decision in Daimler AG v. Bauman has rendered the consent-by-registration statute unenforceable and has impliedly overruled Bane. The Daimler Court held that, except in “exceptional circumstances,” a corporation only is subject to general personal jurisdiction in the state in which it is incorporated or the state in which its principal place of business is located. Several district courts in Pennsylvania have held that, in light of Daimler, Pennsylvania's consent-by-registration statute is unconstitutional and Bane is no longer good law. Other courts, however, have held that Daimler is irrelevant on the issue of consent by registration because it did not address the question. Concluding that “Daimler did not address the constitutionality of Pennsylvania's statutory scheme,” Judge Schiller elected to “join the numerous courts that continue to follow Bane despite the decision in Daimler.”

Until the Third Circuit or the Pennsylvania Supreme Court address the constitutionality of Pennsylvania's consent-by-registration statute in the wake of Daimler, the split in authority among district courts likely will continue to expand. Resolution of the split may be on the horizon, however, as a case directly addressing the issue currently is before the Pennsylvania Supreme Court (Mallory v. Norfolk Southern Railway, 2020 Pa. Super. Unpub. LEXIS 3425 (Pa. Super. Ct. Oct. 30, 2020)). Diab v. British Airways, PLC, No. 20-3744, 2020 U.S. Dist. LEXIS 218765 (E.D. Pa. Nov. 23, 2020).

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