Cooper Tire & Rubber Company v. McCall

In the Supreme Court of Georgia
Decided: September 21, 2021
S20G1368. COOPER TIRE & RUBBER COMPANY v. MCCALL.
LAGRUA, Justice.
We granted certiorari in this products liability action against
an out-of-state corporation to reconsider one of our holdings in
Allstate Insurance Co. v. Klein, 262 Ga. 599 (422 SE2d 863) (1992).
In Klein, we held that Georgia courts may exercise general personal
jurisdiction over any out-of-state corporation that is “authorized to
do or transact business in this state at the time a claim arises.” Id.
at 601 (citation and punctuation omitted). As discussed below,
although Klein’s general-jurisdiction holding is in tension with a
recent line of United States Supreme Court cases addressing when
state courts may exercise general personal jurisdiction over out-of-
state corporations in a manner that accords with the due process
requirements of the United States Constitution, Klein does not
1
violate federal due process under Pennsylvania Fire Insurance Co.
of Philadelphia v. Gold Issue Mining & Milling Co., 243 U. S. 93 (37
SCt 344, 61 LEd 610) (1917), a decision that the Supreme Court has
not overruled. Thus, we are not required to overrule Klein as a
matter of binding federal constitutional law. We also decline to
overrule Klein as a matter of statutory interpretation. Therefore,
we affirm the Court of Appeals’ decision, which followed Klein.
The Court of Appeals summarized the undisputed underlying
facts and procedural history of this case as follows:
[Florida resident] Tyrance McCall sued Cooper Tire
& Rubber Company (“Cooper Tire”) and two other
defendants in the State Court of Gwinnett County for
injuries he allegedly sustained in a motor vehicle
collision.
...
McCall’s complaint alleges that on April 24, 2016, he
was a passenger in a vehicle that was equipped with a
rear tire designed, manufactured, and sold by Cooper
Tire. As the vehicle was traveling on a Florida roadway,
the tire tread “suddenly failed and separated from the
remainder of the tire.” The driver lost control of the
vehicle, which left the roadway and rolled over until it
came to rest in a nearby wooded area. McCall sustained
severe injuries in the crash.
2
Following the collision, McCall sued Cooper Tire for
negligence, strict product liability, and punitive damages.
He also asserted claims against the driver, a Georgia
resident, and the Georgia car dealership that sold the
vehicle to the driver. Cooper Tire answered the
complaint, raising numerous defenses, including lack of
personal jurisdiction. It also filed a motion to dismiss,
arguing that as a nonresident corporate defendant with
only minimal contacts in Georgia, it is not subject to
personal jurisdiction in this state. An accompanying
affidavit from Cooper Tire’s corporate counsel established
that Cooper Tire is incorporated in Delaware and
maintains its principal place of business in Ohio.
McCall responded that Cooper Tire is a resident of
Georgia –_ and thus subject to personal jurisdiction here
–_ because it is authorized to transact business in the
state. In its reply, Cooper Tire did not dispute that it has
been authorized to transact business in Georgia at all
times relevant to this suit. It argued, however, that such
circumstances do not make it a Georgia resident for
jurisdictional purposes. The trial court agreed and
granted Cooper Tire’s motion to dismiss.
McCall v. Cooper Tire & Rubber Co., 355 Ga. App. 273, 273-274 (843
SE2d 925) (2020). On appeal, the Court of Appeals reversed the trial
court, concluding that under Klein, “Cooper Tire is a resident
corporation subject to personal jurisdiction in this state, [and] the
trial court erred in granting the motion to dismiss.” Id. at 275.
We granted Cooper Tire’s petition for a writ of certiorari. For
3
the reasons that follow, we conclude that, although Klein’s general-
jurisdiction holding is in tension with the trajectory of recent United
States Supreme Court decisions addressing a state’s authority to
exercise general personal jurisdiction over corporations, Klein
cannot be overruled on federal constitutional grounds. 1 And,
considerations of stare decisis counsel against overruling Klein’s
holding as a matter of statutory construction. Accordingly, as held
by the Court of Appeals, Cooper Tire is currently subject to the
general jurisdiction of our courts under Klein.
1. The seminal case of Pennoyer v. Neff, 95 U. S. 714 (24 LE
565) (1878), established the parameters governing a state court’s
authority to assert personal jurisdiction over an out-of-state
defendant in accordance with the Due Process Clause of the
Fourteenth Amendment to the United States Constitution. Under
that framework, due process of law required either the “voluntary
appearance” of the out-of-state defendant or personal service of
1 We posed a threshold question to the parties asking whether the
argument that Klein’s holding should be reconsidered was properly preserved
in the courts below. We conclude that the issue was adequately preserved.
4
process upon the out-of-state defendant to bring the defendant
within the state’s jurisdiction and allow the defendant to be
“personally bound by any judgment rendered.” Pennoyer, 95 U. S.
at 733-734 (citation and punctuation omitted).
As recently noted by Justice Gorsuch, in the years after
Pennoyer, interstate commerce and the development of corporations
continued to rise in this country, and thus, many states faced an
increase in legal conflicts involving out-of-state corporate
defendants in their courts. See Ford Motor Co. v. Mont. Eighth
Judicial Dist. Court, __ U. S. __ (141 SCt 1017, 1037, 209 LE2d 225)
(2020) (Gorsuch, J., concurring). “States sought to obviate any
potential question about corporate jurisdiction by requiring an out-
of-state corporation to incorporate under their laws too, or at least
designate an agent for service of process.” Id. “[T]he idea was to
secure the out-of-state company’s presence or consent to suit” in that
state. Id.During this time period, the Supreme Court issued its decision
in Pennsylvania Fire and formalized the concept of general corporate
5
jurisdiction by “consent.” See Pennsylvania Fire, 243 U.S. at 94. In
Pennsylvania Fire, an out-of-state insurance company obtained a
license to do business in Missouri and, in compliance with Missouri’s
corporate statute, Rev. Stats. Mo., 1909, § 7042, filed a power of
attorney “consenting that service of process upon the
superintendent [of the insurance department] should be deemed
personal service upon the company so long as it should have any
liabilities outstanding in the [s]tate.” Id. The lawsuit at issue was
commenced through service of process upon the superintendent, and
the insurance company argued that “such service was insufficient”
and that, “if the statute were construed to govern the present case,
it encountered the 14th Amendment by denying to the defendant
due process of law.” Id. at 94-95. After the Supreme Court of
Missouri held that the statute was applicable and consistent with
the United States Constitution, the insurance company appealed to
the United States Supreme Court. See id. at 95.
In affirming the Missouri Supreme Court, the United States
Supreme Court held:
6
The construction of the Missouri statute thus adopted
hardly leaves a constitutional question open. The
defendant had executed a power of attorney that made
service on the superintendent the equivalent of personal
service. If by a corporate vote it had accepted service in
this specific case, there would be no doubt of the
jurisdiction of the state court over a transitory action of
contract. If it had appointed an agent authorized in terms
to receive service in such cases, there would be equally
little doubt. It did appoint an agent in language
that rationally might be held to go to that length. The
language has been held to go to that length, and the
construction did not deprive the defendant of due process
of law even if it took the defendant by surprise, which we
have no warrant to assert.
Pennsylvania Fire, 243 U. S. at 95. Thus, under the holding of
Pennsylvania Fire, where a state statute notifies an out-of-state
corporation that by registering and appointing an agent for service
of process in the state, the corporation has consented to general
personal jurisdiction there, the corporation has not been deprived of
the Fourteenth Amendment’s guarantee of due process of law when
it is sued in that state. See id. at 95-96.
In International Shoe v. Washington, 326 U. S. 310 (66 SCt
154, 90 LE 95) (1945), the Court further refined the concept of
personal jurisdiction as it applied to out-of-state corporations and,
7
in doing so, examined the historical context of its prior holdings,
which were largely influenced by an out-of-state defendant’s
presence within the “territorial jurisdiction” of a state. Id. at 316.
The Court noted that “the corporate personality is a fiction,” and
thus, unlike an individual, a corporation’s “presence without, as well
as within, the state of its origin can be manifested only by activities
carried on in its behalf by those who are authorized to act for it.” Id.To further elucidate this point, the Court explained:
“Presence” in the state in this sense has never been
doubted when the activities of the corporation there have
not only been continuous and systematic, but also give
rise to the liabilities sued on, even though no consent to
be sued or authorization to an agent to accept service of
process has been given. Conversely it has been generally
recognized that the casual presence of the corporate agent
or even his conduct of single or isolated items of activities
in a state in the corporation’s behalf are not enough to
subject it to suit on causes of action unconnected with the
activities there. To require the corporation in such
circumstances to defend the suit away from its home or
other jurisdiction where it carries on more substantial
activities has been thought to lay too great and
unreasonable a burden on the corporation to comport with
due process.
Id. at 317 (citations omitted). The Court thus held that a state court
8
could appropriately assert personal jurisdiction over an out-of-state
corporation, consistent with the Due Process Clause of the
Fourteenth Amendment, when the defendant corporation has such
“minimum contacts with [the forum state] such that the
maintenance of the suit does not offend traditional notions of fair
play and substantial justice,” or in instances where the corporation’s
continuous operations in the state were “so substantial and of such
a nature as to justify suit against it on causes of action arising from
dealings entirely distinct from those activities.” Id. at 316, 318(citation and punctuation omitted).
Notably, in reaching this holding in International Shoe, the
Court did not overrule or even reference Pennsylvania Fire or reject
the theory that an out-of-state corporation could consent to personal
jurisdiction in a state’s courts by registering to do business there. In
fact, the Court noted that the jurisdictional determinations
rendered in International Shoe applied to cases where “no consent to
be sued or authorization to an agent to accept service of process
ha[d] been given” – a reasonable limitation given that the Court was
9
considering only those circumstances where an out-of-state
corporate defendant was subject to general jurisdiction in a state
against its will, as opposed to having consented to general
jurisdiction in the state through the execution of a contract,
voluntary registration, or otherwise. Id. at 317.
In the decades after International Shoe, the Court continued to
hone the concept of a state court’s exercise of personal jurisdiction
over an out-of-state corporation that had not “consent[ed] to be
sued.” 326 U. S. at 317. To that end, the Court recognized two
emergent subsets of jurisdictional authority – general personal
jurisdiction and specific personal jurisdiction. See, e.g., Bristol-
Myers Squibb Co. v. Superior Court of California, San Francisco
County, __ U. S. __ (137 SCt 1773, 1781-1783, 198 LE2d 395) (2017);
BNSF Railway Co. v. Tyrrell, __ U. S. __ (137 SCt 1549, 1558-1559,
198 LE2d 36) (2017); Daimler AG v. Bauman, 571 U. S. 117, 133-139
(134 SCt 746, 187 LE2d 624) (2014); Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U. S. 915, 926-929 (131 SCt 2846,
180 LE2d 796) (2011).
10
In clarifying the concept of general jurisdiction, the Court
explained:
General jurisdiction, as its name implies, extends to any
and all claims brought against a defendant. Those claims
need not relate to the forum State or the defendant’s
activity there; they may concern events and conduct
anywhere in the world. But that breadth imposes a
correlative limit: Only a select set of affiliations with a
forum will expose a defendant to such sweeping
jurisdiction. In what we have called the “paradigm” case,
an individual is subject to general jurisdiction in her place
of domicile. And the equivalent forums for a corporation
are its place of incorporation and principal place of
business.
Ford, 141 SCt at 1024 (II) (A) (citations and punctuation omitted).
See also Goodyear, 564 U. S. at 919 (“A court may assert general
jurisdiction over foreign . . . corporations to hear any and all claims
against them when their affiliations with the State are so
continuous and systematic as to render them essentially at home in
the forum State.” (Citation and punctuation omitted).).
Over the last ten years, Goodyear and its progeny have adhered
to the jurisdictional approach of International Shoe and held that,
at least with respect to an out-of-state corporation that has not
11
consented to jurisdiction, the corporation will ordinarily be subject
to general jurisdiction in only one or two states – the state where it
is incorporated and, if different, the state where its principal place
of business is located. See Ford, 141 SCt at 1024 (II) (A). The Court
reasoned that these locations are the appropriate forums for the
exercise of general jurisdiction over corporations because these
“affiliations have the virtue of being unique – that is, each ordinarily
indicates only one place – as well as easily ascertainable,” and these
locations “afford plaintiffs recourse to at least one clear and certain
forum in which a corporate defendant may be sued on any and all
claims.” Daimler, 571 U. S. at 137 (IV) (B). Additionally, the Court
explained that any broader exercise of general jurisdiction would
“scarcely permit out-of-state defendants to structure their primary
conduct with some minimum assurance as to where that conduct
will and will not render them liable to suit.” Id. at 139 (IV) (B)
(citations and punctuation omitted).
In contrast to general jurisdiction,
12
[s]pecific jurisdiction . . . covers defendants less
intimately connected with a State, but only as to a
narrower class of claims. The contacts needed for this
kind of jurisdiction often go by the name “purposeful
availment.” The defendant, we have said, must take
some act by which it purposefully avails itself of the
privilege of conducting activities within the forum
State. The contacts must be the defendant’s own choice
and not random, isolated, or fortuitous. They must show
that the defendant deliberately reached out beyond its
home – by, for example, exploiting a market in the forum
State or entering a contractual relationship centered
there. Yet even then – because the defendant is not “at
home” – the forum State may exercise jurisdiction in only
certain cases. The plaintiff’s claims, we have often stated,
must arise out of or relate to the defendant’s contacts with
the forum.
Ford, 141 SCt at 1024-1025 (II) (A) (citations and punctuation
omitted). See also Goodyear, 564 U. S. at 919 (“Specific
jurisdiction . . . depends on an affiliation between the forum and the
underlying controversy, principally, activity or an occurrence that
takes place in the forum State and is therefore subject to the State’s
regulation.” (Citations and punctuation omitted).). For purposes of
establishing specific jurisdiction, “[m]any States have enacted long-
arm statutes authorizing courts to exercise specific jurisdiction over
[out-of-state] manufacturers when the events in suit, or some of
13
them, occurred within the forum state.” Goodyear, 564 U. S. at 926(II) (B). The General Assembly has enacted such a long-arm statute
in Georgia, OCGA § 9-10-90 et seq. (the “Long Arm Statute”).
OCGA § 9-10-91 says in pertinent part:
A court of this state may exercise [specific] personal
jurisdiction over any nonresident . . . , as to a cause of
action arising from any of the acts, omissions, ownership,
use, or possession enumerated in this Code section, in the
same manner as if he or she were a resident of this state,
if in person or through an agent, he or she:
(1) Transacts any business within this state;
(2) Commits a tortious act or omission within this state,
except as to a cause of action for defamation of character
arising from the act; [or]
(3) Commits a tortious injury in this state caused by an
act or omission outside this state if the tort-feasor
regularly does or solicits business, or engages in any other
persistent course of conduct, or derives substantial
revenue from goods used or consumed or services
rendered in this state[.]
More succinctly stated, the Long Arm Statute defines “the
scope of personal jurisdiction that Georgia courts may exercise over
nonresidents pursuant to OCGA § 9-10-91” and “requires that an
out-of-state defendant must do certain acts within the State of
Georgia before he can be subjected to [specific] personal
14
jurisdiction.” Innovative Clinical & Consulting Svcs., LLC v. First
Nat. Bank of Ames, 279 Ga. 672, 673 (620 SE2d 352) (2005) (citations
and punctuation omitted). See also Gust v. Flint, 257 Ga. 129, 130
(356 SE2d 513) (1987) (“The rule that controls is our [Long Arm]
statute, which requires that an out-of-state defendant must do
certain acts within the State of Georgia before he can be subjected
to [specific] personal jurisdiction,” and where “no such acts were
committed, there is no jurisdiction.”). OCGA § 9-10-90 defines
“nonresident” for purposes of the Long Arm Statute. OCGA § 9-10-
90 provides, in relevant part, that
the term “nonresident” includes . . . a corporation which
is not organized or existing under the laws of this state
and is not authorized to do or transact business in this
state at the time a claim or cause of action under Code
Section 9-10-91 arises.
The definition of “nonresident” found in OCGA § 9-10-90
formed the basis for our first holding in Klein. Klein arose from a
motor vehicle accident on a Georgia interstate involving two vehicles
driven by nonresidents of Georgia. See Klein, 262 Ga. at 599. The
plaintiff, who was injured in the accident, was a passenger in one of
15
the vehicles and filed a lawsuit in Glynn County against Allstate
Insurance Company, the insurer of the vehicle in which he was
traveling. See id. at 599-600. In support of the plaintiff’s claim that
Georgia had personal jurisdiction over Allstate, the plaintiff
asserted that he was not relying on the Long Arm Statute for
personal jurisdiction, but rather that Allstate was subject to
personal jurisdiction because it was “a corporation authorized to
transact business in Georgia, and which has an office and a
registered agent in Glynn County.” Id. at 600. Allstate moved to
dismiss the plaintiff’s complaint for lack of personal jurisdiction,
claiming that “any connection between the cause of action and
Allstate’s activities within the state were too tenuous to satisfy”
subsection (1) of OCGA § 9-10-91. Id. The trial court granted
Allstate’s motion to dismiss. See id. On appeal, the Court of Appeals
reversed, holding that personal jurisdiction over Allstate was proper
under the Long Arm Statute. See Klein v. Allstate Ins. Co., 202 Ga.
App. 188, 191 (2) (413 SE2d 777) (1991).
This Court granted certiorari, and although we affirmed, we
16
did so under a different rationale, explaining that
[t]he Long Arm Statute applies solely to persons who were
nonresidents of Georgia at the time the act or omission
complained of occurred. Therefore, the [statute’s]
requirement that a cause of action arise out of activities
within the state applies only to the exercise of personal
jurisdiction over nonresidents.
Klein, 262 Ga. at 600 (emphasis in original; citation and punctuation
omitted). We then noted that the definition of “nonresident” in the
Long Arm Statute “includes a corporation which is not organized or
existing under the laws of this state and is not authorized to do or
transact business in this state at the time a claim or cause of action
arises.” Id. at 601 (emphasis in original; citation and punctuation
omitted). Given this definition, we held:
It is apparent from the language of [the “nonresident”
definition] that a corporation which is authorized to do or
transact business in this state at the time a claim arises
is a “resident” for purposes of personal jurisdiction over
that corporation in an action filed in the courts of this
state.
Id. at 601 (emphasis in original; punctuation omitted). Citing the
Georgia Business Corporation Code, OCGA § 14-2-1505 (b),2 we
2 OCGA § 14-2-1505 (b) provides:
17
further held that “[a]s a resident, such a foreign corporation may sue
or be sued to the same extent as a domestic corporation.” Klein, 262
Ga. at 601.
Based on our reading of the Georgia statutes, we concluded
that
a plaintiff wishing to sue in Georgia a corporation
authorized to do business in Georgia is not restricted by
the personal jurisdiction parameters of [the Long Arm
Statute] including the requirement that a cause of action
arise out of a defendant’s activities within the state.
Klein, 262 Ga. at 601. In other words, based primarily on the Long
Arm Statute’s scheme for specific jurisdiction over corporations, we
held that any corporation that is authorized to do business in
Georgia is subject to the general jurisdiction of Georgia’s courts.
And, in a concluding footnote, we suggested that this holding did not
A foreign corporation with a valid certificate of authority has the
same but no greater rights under this chapter and has the same
but no greater privileges under this chapter as, and except as
otherwise provided by this chapter is subject to the same duties,
restrictions, penalties, and liabilities now or later imposed on, a
domestic corporation of like character.
18
violate federal due process. See id. at 601 n.3. 3
2. As noted above, since Klein, the United States Supreme
Court has continued to develop the principles governing a state
court’s exercise of general personal jurisdiction over out-of-state
corporations in Goodyear and its progeny. And, in doing so, the
Court has “declined to stretch general jurisdiction beyond limits
traditionally recognized” by International Shoe. Daimler, 571 U. S.
3 Specifically, we said:
The constitutionality of the definition of nonresident contained in
the Long Arm Statute, as it pertains to foreign corporations, has
not been challenged in this case, addressed by the parties, or ruled
on by the lower courts. However, it appears that the definition
does not run afoul of the “minimum contacts” requirement of
procedural due process. The U. S. Supreme Court has addressed
the issue of just what constitutes “fair play and substantial justice”
when it comes to personal jurisdiction over foreign corporations.
That Court held that “if an authorized representative of a foreign
corporation be physically present in the state of the forum and be
there engaged in activities appropriate to accepting service or
receiving notice on its behalf, we recognize that there is no
unfairness in subjecting that corporation to the jurisdiction of the
courts of that state through such service of process upon that
representative. . . . [W]e find no requirement of federal due process
that either prohibits a state from opening its courts to [a cause of
action not arising out of the corporation’s activities in the state]
or compels [a state] to do so. This conforms to the realistic
reasoning in International Shoe v. Washington [326 U. S. 310].”
Id. at 601 n.3 (citation omitted).
19
at 132 (III). As the Court “has increasingly trained on the
relationship among the defendant, the forum, and the litigation, i.e.,
specific jurisdiction, general jurisdiction has come to occupy a less
dominant place in the contemporary scheme.” Id. at 132-133 (III).
In sum, in the Goodyear line of cases, the Court has held that
general jurisdiction is properly exercised where a corporation’s
operations are so substantial, continuous, and systematic as to
render the corporation essentially “at home” in a state, a
determination that will necessarily be made on a case by case basis
after considering the facts and circumstances unique to each case.
See Goodyear, 564 U. S. at 919, 929 (II) (B); Daimler, 571 U. S. at
130 (III).
However, while Cooper Tire relies on Goodyear and its progeny
to challenge the viability of Pennsylvania Fire’s “consent by
registration” theory of general personal jurisdiction and to argue
that Pennsylvania Fire’s holding “conflicts with modern due process
jurisprudence,” Pennsylvania Fire has not been overruled, nor was
it even addressed by the majority opinions in these cases. In fact,
20
during this same time period, the Court has continued to recognize
consent as a proper means of exercising personal jurisdiction over
an out-of-state corporation. See J. McIntyre Mach., Ltd. v. Nicastro,
564 U. S. 873, 880 (II) (131 SCt 2780, 180 LE2d 765) (2011) (plurality
op.) (“A person may submit to a [s]tate’s authority in a number of
ways[;] [t]here is, of course, explicit consent,” and “[p]resence within
a [s]tate at the time suit commences through service of process is
another example.” (Citations and punctuation omitted).).
In addition, a number of federal and state courts have
concluded that despite Goodyear and its progeny, the “designation
of an in-state agent for service of process in accordance with a state
registration statute may constitute consent to personal jurisdiction,
if supported by the breadth of the statute’s text or interpretation.”
Otsuka Pharm. Co. v. Mylan Inc., 106 FSupp. 3d 456, 469 (D.N.J.
2015). See also, e.g., AK Steel Corp. v. PAC Operating Ltd.
Partnership, Case No. 2:15-CV-09260-CM-GEB, 2017 WL 3314294at*3-*4 (III) (A) (D. Kan. 2017); Acorda Therapeutics, Inc. v. Mylan
21
Pharms. Inc., 78 FSupp.3d 572, 588-589 (III) (D. Del. 2015) 4;
Rodriguez v. Ford Motor Co., 458 P3d 569, 575-578 (N.M. 2018);
Weinstein v. Kmart Corp., 99 A3d 997, 997 (N.Y. 2012).
While we acknowledge that some other courts have held to the
contrary, we note that the states in those cases did not have a
4 For example, in Acorda Therapeutics, the court explained:
Daimler does not eliminate consent as a basis for a state to
establish general jurisdiction over a corporation which has
appointed an agent for service of process in that state, as is
required as part of registering to do business in that state. Mylan
Pharma concedes, as it must, that Daimler does not expressly
address consent. Indeed, in the entire opinion in Daimler, there is
but a single, passing reference to the concept of consent: “The
Court’s 1952 decision in Perkins v. Benguet Consol. Mining Co.,
342 U.S. 437, 72 SCt 413, 96 LEd 485 (1952), remains the textbook
case of general jurisdiction appropriately exercised over a foreign
corporation that has not consented to suit in the forum.” In this
way, Daimler distinguishes between consensual and non-
consensual bases for jurisdiction. It preserves what has long been
the case: that these are two distinct manners of obtaining
jurisdiction over a corporation. Consistent with Daimler, it
remains the law that general jurisdiction may be established by
showing that a corporation is “at home” in the sense described in
detail in Daimler, or separately general jurisdiction may be
established by a corporation’s consent to such
jurisdiction. Daimler is directed to the former situation and has
nothing to say about the latter scenario.
Id. (citations and punctuation omitted).
22
corporate domestication or registration statute, or any authoritative
case law interpreting such a statute, that provided notice to out-of-
state corporations that they consented to general jurisdiction in the
state by domesticating or registering to do business there. See, e.g.,
Fidrych v. Marriott Intl. Inc., 952 F3d 124, 137 (4th Cir. 2020)
(holding that under the rules set out in Pennsylvania Fire,
“obtaining the necessary certification to conduct business in a given
state amounts to consent to general jurisdiction in that state only if
that condition is explicit in the statute or the state courts have
interpreted the statute as imposing that condition,” but “South
Carolina law does not make consent to general jurisdiction a
consequence of obtaining a certificate of authority to transact
business” (emphasis omitted)); Waite v. AII Acquisition Corp., 901
F3d 1307, 1320-1321 (11th Cir. 2018) (holding that Florida law did
not either expressly or by state-court construction establish that
registration to do business and appointment of an agent for service
of process in Florida amounted to consent to general personal
jurisdiction in Florida courts); Gulf Coast Bank & Trust Co. v.
23
Designed Conveyor Sys., LLC, 717 Fed. Appx. 394, 397-398 (5th Cir.
2017) (holding that “[t]his case lacks what Pennsylvania Fire had: a
clear statement from the state court construing the statute to
require consent,” because in Louisiana, “[n]one of the statutes
covering registration informs a company that by registering it
consents to suit”); DeLeon v. BNSF Railway Co., 426 P3d 1, 7-9 (392
Mont. 446) (2018) (holding that a foreign corporation’s act of
registering to do business in Montana and subsequently conducting
in-state business activities did not amount to consent to general
personal jurisdiction in Montana in accordance with due process
because the registration statutes specifically provided that
appointment of registered agent did not by itself create a basis for
personal jurisdiction and nothing else put the foreign corporation on
notice that, by appointing a registered agent to receive service of
process, it was consenting to personal jurisdiction); Genuine Parts
Co. v. Cepec, 137 A3d 123, 148 (Del. 2016) (concluding that while
“Daimler does not suggest that th[e] traditional avenue of consent
to personal jurisdiction is no longer viable,” the United States
24
Supreme Court has clarified “the due-process limits on general
jurisdiction in Goodyear and Daimler,” and thus, “we read our state’s
registration statutes as providing a means for service of process and
not as conferring general jurisdiction”).
Georgia’s Business Corporation Code does not expressly notify
out-of-state corporations that obtaining authorization to transact
business in this State and maintaining a registered office or
registered agent in this State subjects them to general jurisdiction
in our courts, see OCGA § 14-2-1501 (a), OCGA § 14-2-1507.
However, our general-jurisdiction holding in Klein does notify out-
of-state corporations that their corporate registration will be treated
as consent to general personal jurisdiction in Georgia,
distinguishing our State from those in the cases just cited. Unless
and until the United States Supreme Court overrules Pennsylvania
Fire, that federal due process precedent remains binding on this
Court and lower federal courts. See Rodriguez de Quijas v.
Shearson/American Express, Inc., 490 U. S. 477, 484 (III) (109 SCt
1917, 104 LE2d 526) (1989) (explaining that even when the holding
25
of a Supreme Court decision appears to be contradicted by the
reasoning of another line of decisions, the holding rather than the
subsequent reasoning is binding on lower courts). See also Maxim
Cabaret, Inc. v. City of Sandy Springs, 304 Ga. 187, 191 n.4 (III) (816
SE2d 31) (2018) (“[W]here precedent of the Supreme Court has
direct application in a case, yet appears to rest on reasons rejected
in some other line of decisions, lower courts should follow the case
which directly controls, leaving to [the Supreme] Court the
prerogative of overruling its own decisions.” (Citation and
punctuation omitted).). And, viewing Klein against this backdrop,
Klein’s holding that corporate registration in Georgia is consent to
general jurisdiction in Georgia does not violate federal due process
under Pennsylvania Fire.
3. Having concluded that Klein’s general-jurisdiction holding
does not violate federal due process, we must now decide whether it
should still be followed as a matter of statutory stare decisis.
Under the doctrine of stare decisis, courts generally stand
by their prior decisions, because it promotes the
evenhanded, predictable, and consistent development of
26
legal principles, fosters reliance on judicial decisions, and
contributes to the actual and perceived integrity of the
judicial process. Stare decisis, however, is not an
inexorable command. Courts, like individuals, but with
more caution and deliberation, must sometimes
reconsider what has been already carefully considered,
and rectify their own mistakes. In reconsidering our prior
decisions, we must balance the importance of having the
question decided against the importance of having it
decided right. To that end, we have developed a test that
considers the age of precedent, the reliance interests at
stake, the workability of the decision, and, most
importantly, the soundness of its reasoning. The
soundness of a precedent’s reasoning is the most
important factor.
Olevik v. State, 302 Ga. 228, 244-245 (2) (c) (iv) (806 SE2d 505)
(2017) (citations, emphasis, and punctuation omitted).
Considerations of stare decisis have greater weight with regard to
precedents interpreting statutes than precedents regarding
constitutional issues. See Allen v. State, 310 Ga. 411, 419-420 (6)
(851 SE2d 541) (2020). Weighing the stare decisis factors here, we
see no compelling reason to overrule Klein’s statutory construction
holding.
(a) Soundness of the Reasoning
Addressing first the soundness of the reasoning factor, we note
27
that Klein’s first statutory construction holding – i.e., that registered
corporations are not “nonresidents” and thus are not subject to
specific personal jurisdiction in Georgia under the Long Arm Statute
– was clearly correct under the plain language of the statute, and it
has not been challenged by the parties in this case. Although the
reasoning behind the Klein Court’s inverse implication – i.e., that
because registered corporations are not subject to specific
jurisdiction under the Long Arm Statute, they must be subject to
general jurisdiction in Georgia – may not have been well-explained,
it was not clearly wrong under the governing case law at the time.
And, it is not unconstitutional given the continuing validity of
Pennsylvania Fire.
Additionally, Klein’s holding about general jurisdiction in this
context was sensible because, had the Court reached a different
conclusion, a jurisdictional gap would have emerged whereby a
registered out-of-state corporation would apparently not have been
subject to any jurisdiction in Georgia – specific or general. Cooper
Tire does not explain what alternative holding the Court should
28
have reached in Klein, other than to suggest that registered
corporations should not be subject to the jurisdiction of Georgia’s
courts at all. Accordingly, we conclude that this factor does not
weigh in favor of overruling Klein.
(b) Age of the Precedent
Klein is almost 30 years old; though we have overruled even
older cases when other considerations of stare decisis counseled in
favor of doing so, see, e.g., Southall v. State, 300 Ga. 462, 468 (1)
(796 SE2d 261) (2017), Klein’s age does not weigh in favor of its
overruling. See Frett v. State Farm Employee Workers’ Comp., 309
Ga. 44, 65 (844 SE2d 749) (2020) (Peterson, J., dissenting) (noting
that a precedent’s age is an important consideration
“especially . . . when statutory precedents are considered”).
We also note that while this Court has cited Klein only once in
the past 30 years for a different proposition, see Innovative Clinical,
279 Ga. at 674 n.2, the Court of Appeals has relied upon or cited
Klein’s general-jurisdiction holding in nine cases, and federal
district courts applying Georgia law have done so in 12 cases. See,
29
e.g., Ward v. Marriott Int., Inc., 352 Ga. App. 488, 494 (835 SE2d
322) (2019); Cherokee Warehouses, Inc. v. Babb Lumber Co., 244 Ga.
App. 197, 198 n.6 (535 SE2d 254) (2000); Pratt & Whitney Canada,
Inc. v. Sanders, 218 Ga. App. 1, 2-3 (460 SE2d 94) (1995); Rumbold
v. Trader Joe’s East, Inc., Case No. 1:20-cv-03437-WMR-LTW, 2021
WL 3043420 at *3 (II) (A) (N.D. Ga. 2021); Drake v. JWN Inc., Case
No. CV218-026, 2018 WL 9415068 at *2 (I) (S.D. Ga. 2018); Hines v.
Mann Bracken, LLP, Case No. 1:09-CV-03052-RWS-LTW, 2010 WL
11647047 at *3 (I) (A) (N.D. Ga. 2010).
(c) Reliance Interests
We have not identified, nor has McCall cited, “any [] reliance
interests that would be significantly impaired were we to overrule”
Klein. Frett, 309 Ga. at 61 (majority op.).
(d) Workability
The workability factor of the stare decisis analysis weighs most
strongly against overruling Klein’s general-jurisdiction holding. If
we were to overrule that holding, we would generate the
jurisdictional gap discussed above whereby a potentially large swath
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of out-of-state corporations like Cooper Tire could fall into a class
exempt from all personal jurisdiction—specific and general—in this
State simply because they are authorized and registered to do
business here.
As Klein correctly held based on the plain language of the Long
Arm Statute, the definition of “nonresident” in OCGA § 9-10-90
limits the statute’s application to out-of-state corporations that are
not authorized to do or transact business in this state at the time a
claim under OCGA § 9-10-91 arises. Given that definition, out-of-
state corporations that are authorized and registered to do business
in Georgia are not subject to specific jurisdiction under the Long
Arm Statue. But, if we were to overrule Klein’s general-jurisdiction
holding, these corporations would not be subject to general
jurisdiction in this State, either. This outcome would allow out-of-
state corporations to insulate themselves from personal jurisdiction
in Georgia simply by obtaining the requisite certificate of authority
and registering to do business here, thereby effectively immunizing
themselves from suit for any cause whatsoever. Notably, this is the
31
outcome suggested by Cooper Tire – i.e., that we should overrule
Klein and hold that if an out-of-state corporation registers to do
business in Georgia, that corporation cannot be sued in Georgia.
Based on our analysis of the stare decisis factors, we decline to
overrule Klein, avoiding this perverse consequence. However, we
note that the tension between Klein and recent United States
Supreme Court precedent remains, and Klein’s general-jurisdiction
holding may be undermined if the Supreme Court ever reconsiders
and overrules Pennsylvania Fire. For these reasons, the General
Assembly could preemptively obviate that risk by modifying the
governing statutes to enable Georgia courts to exercise specific
personal jurisdiction over out-of-state corporations whether they are
authorized to do business in this State or not, provide for general
jurisdiction where appropriate, or otherwise tailor this State’s
jurisdictional scheme within constitutional limits.
4. In conclusion, because the Long Arm Statute does not
apply to an out-of-state corporation that is authorized to do business
in Georgia, Cooper Tire is not subject to specific personal jurisdiction
32
in Georgia under OCGA §§ 9-10-90 and 9-10-91. However, because
Cooper Tire is registered and authorized to do business in Georgia,
Cooper Tire is currently subject to the general jurisdiction of our
courts under Klein’s general-jurisdiction holding, which we have
decided to leave in place. On this basis, we affirm the decision of the
Court of Appeals.
Judgment affirmed. All the Justices concur.
33
S20G1368. COOPER TIRE & RUBBER COMPANY v. McCALL.
BETHEL, Justice, concurring.
I concur fully in the opinion of the Court. I write separately for
the sole purpose of calling the General Assembly’s attention to the
peculiar and precarious position of the current law of Georgia.
Currently, foreign corporations that register to conduct
business in Georgia expose themselves to being hailed into Georgia
courts for all matters regardless of the underlying suit’s connection
to Georgia. By contrast, those that decline Georgia registration have
significantly less exposure. Because it creates a disincentive for
foreign corporations to register in Georgia, this structure strikes me
as contrary to the often-expressed desire to make Georgia a
“business-friendly” state. Moreover, in light of the trend in the
recent opinions of the United States Supreme Court regarding the
exercise of personal jurisdiction by state courts, there appears to be
a meaningful chance that the current law of Georgia will, at some
point, be found to be inconsistent with the requirements of federal
34
due process. In that event, Georgians injured in Georgia by the acts
or omissions of corporations domiciled outside of Georgia and
registered to conduct business here might find legal recourse
available only in the courts of other states. This is so because in the
event the holding of Klein is overruled on due process grounds, the
“gap” identified in the Court’s opinion in this case will immediately
spring to life, and Georgia’s law governing the exercise of personal
jurisdiction will not include a basis for jurisdiction over those
businesses domiciled outside of Georgia that have registered to
conduct business in Georgia. I’ll not endeavor to list the potential
problems that state of affairs might present. In light of these
concerns, even if it elects to maintain the status quo, it is my hope
that the General Assembly will at least consider this matter
thoroughly and carefully.
35