DocketNumber: DA 17-0627
Citation Numbers: 426 P.3d 1, 2018 MT 219, 392 Mont. 446
Judges: McKinnon
Filed Date: 9/11/2018
Status: Precedential
Modified Date: 10/18/2024
**447¶ 1 Eddie M. DeLeon, Jason Kingery, and Steve Paul Beck (collectively, Plaintiffs) each filed suit against BNSF Railway Company (BNSF) in Montana's Thirteenth Judicial District Court, Yellowstone County, for injuries allegedly sustained while working for BNSF in states other than Montana. BNSF moved to dismiss Plaintiffs' claims for lack of personal jurisdiction. The District Court granted BNSF's motions to dismiss and each Plaintiff appealed. We address the following issue in Plaintiffs' consolidated appeal:
*4Does a company consent to general personal jurisdiction in Montana when it registers to do business and voluntarily conducts business activities in Montana?
¶ 2 We conclude a company does not consent to general personal jurisdiction by registering to do business in Montana and voluntarily conducting in-state business activities. We therefore affirm the District Court's orders granting BNSF's motions to dismiss for lack of personal jurisdiction.
FACTUAL AND PROCEDURAL BACKGROUND
¶ 3 Plaintiffs each filed Federal Employers' Liability Act (FELA) negligence claims against BNSF in Montana's Thirteenth Judicial District Court, Yellowstone County. BNSF is a rail carrier incorporated in Delaware with its principal place of business in Texas. BNSF does business in Montana: it has 2,061 miles of railroad track in Montana; employs approximately 2,100 workers in Montana; maintains an **448automotive facility in Montana; and generates less than 10% of its total revenue in Montana. BNSF Ry. Co. v. Tyrrell , 581 U.S. ----, ----,
¶ 4 In December 2011, plaintiff Kingery, a Missouri resident, filed to recover for injuries he allegedly sustained while working for BNSF outside of Montana. In June 2013, plaintiff DeLeon, a Texas resident, filed to recover for injuries he allegedly sustained while working for BNSF in Texas. In January 2014, plaintiff Beck, a Texas resident, filed to recover for injuries he allegedly sustained while working for BNSF in Texas. Thereafter, Plaintiffs' cases followed substantially similar procedural paths.
¶ 5 BNSF moved to dismiss Plaintiffs' claims pursuant to M. R. Civ. P. 12(b)(2) for lack of personal jurisdiction. Plaintiffs responded to BNSF's motions to dismiss, maintaining Montana had personal jurisdiction over BNSF because the rail carrier consented to general personal jurisdiction in Montana when it registered to do business and subsequently conducted in-state business activities. The District Court determined BNSF did not consent to personal jurisdiction in Montana and accordingly dismissed Plaintiffs' claims for lack of personal jurisdiction. Plaintiffs appeal.
STANDARD OF REVIEW
¶ 6 The determination of personal jurisdiction is a question of law that we review de novo. Tackett v. Duncan ,
DISCUSSION
¶ 7 Personal jurisdiction refers to a court's power over the parties in a proceeding. Personal Jurisdiction , Black's Law Dictionary (10th ed. 2014). We distinguish between general (i.e., all-purpose) and specific (i.e., case-linked) personal jurisdiction. Buckles , ¶ 12 ; M. R. Civ. P. 4(b)(1). General personal jurisdiction is premised upon the defendant's relationship to the forum state, while specific personal jurisdiction is premised upon the defendant's relationship to both the forum state and the particular cause of action.
**449¶ 8 General personal jurisdiction exists when a corporation's affiliations with Montana are so continuous and systematic as to render it essentially at home in Montana. See BNSF , 581 U.S. at ----,
¶ 9 Specific personal jurisdiction, on the other hand, exists when the suit itself "arises from the specific circumstances set forth in Montana's long-arm statute, M. R. Civ. P. 4(b)(1)." Buckles , ¶ 15. The exercise of specific personal jurisdiction "depends on whether the defendant's 'suit-related conduct' created a substantial connection with" Montana. Tackett , ¶ 19 (quoting Walden v. Fiore ,
¶ 10 A court's exercise of personal jurisdiction over a defendant, **450whether general or specific, is limited by the Fourteenth Amendment's Due Process Clause. U.S. Const. amend. XIV. A defendant must have "certain minimum contacts [with Montana] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' " Tackett , ¶ 18 (quoting Walden , 571 U.S. at 283, 134 S.Ct. at 1121 (quoting Int'l Shoe ,
¶ 11 However, personal jurisdiction is an individual right and, as such, a defendant may either expressly or impliedly consent to a court's personal jurisdiction and thereby waive his due process rights. Milanovich v. Schnibben ,
¶ 12 A defendant may consent to or waive personal jurisdiction in **451various ways. For example, a defendant waives its right to object to the court's exercise of personal jurisdiction if it fails to timely raise the issue in its initial response. M. R. Civ. P. 12 ; Garza v. Forquest Ventures, Inc. ,
¶ 13 In those instances, a defendant controls a specific waiver of its due process rights: it either waives its right to object to personal jurisdiction in one proceeding by not timely raising the issue, or it consents to the court's jurisdiction over disputes arising from one contract. Because a defendant waives its constitutional due process protections by consenting to personal jurisdiction, due process is not offended by those types of specific, knowing waivers. See Garza , ¶ 43, Milanovich , ¶ 10 ; see also Burger King Corp. v. Rudzewicz ,
¶ 14 Consent jurisdiction is, by definition, jurisdiction "that parties have agreed to, either by accord, by contract, or by general appearance." Consent Jurisdiction , Black's Law Dictionary (10th ed. 2014) (emphasis added). Because it is based on the parties' approval and agreement, the scope of the consent must be defined and limited accordingly. See WorldCare Ltd. Corp. v. World Ins. Co. ,
¶ 15 Plaintiffs ask us to contemplate a different type of consent jurisdiction: registration-based consent. They contend BNSF consented to general personal jurisdiction in Montana by registering to do business and subsequently conducting in-state business activities. Registration-based consent is distinguishable from other types of consent jurisdiction in its breadth. It permits a court to obtain general personal jurisdiction over a defendant-it is not limited to one case or **452one contract. Here, we must determine whether a defendant's act of registering to do business in Montana, and then subsequently conducting in-state business activities, is a constitutionally permissible manner of finding consent to personal jurisdiction.
¶ 16 Personal jurisdiction used to be tied directly to a defendant's presence within the forum state. Pennoyer v. Neff ,
¶ 17 In 1945, the United States Supreme Court decided International Shoe Company v. Washington , in which the Court directed its personal jurisdiction analysis away from the territorial approach towards the modern-day, contacts-focused analysis. Int'l Shoe ,
¶ 18 Plaintiffs now allege that a foreign corporation's compliance with registration statutes, which were initially enacted to ensure proper service of process on foreign corporations at a time when personal jurisdiction was tied to service, plus in-state business activity, equates to consent to general personal jurisdiction in Montana. Because a foreign corporation must comply with Montana's registration requirements to lawfully do business in Montana, the implication of **453Plaintiffs' legal theory is that every foreign corporation lawfully conducting business in Montana consented to general personal jurisdiction when it registered to do business in the state.
¶ 19 Montana's registration statutes clearly distinguish between service of process and the scope of personal jurisdiction. To transact business in Montana, a foreign corporation must obtain a certificate of authority to do business in the state. Section 35-1-1026(1), MCA. To obtain a certificate of authority, a foreign corporation must appoint a registered agent for service of process. Section 35-1-1028, MCA (application for certificate of authority); § 35-7-105, MCA (appointment of registered agent); § 35-7-113, MCA (service of process on entities). However, Montana's registration statutes specifically provide that the appointment of a registered agent "does not by itself create the basis for personal jurisdiction over the represented entity in this state." Section 35-7-115, MCA (emphasis added). This express jurisdictional limitation appropriately ensures that service of process and the scope of personal jurisdiction remain separate legal concepts. Nothing puts a corporation on notice that, by appointing a registered agent to receive service of process in Montana, it is consenting to general personal jurisdiction in Montana. In fact, the statute explicitly tells corporations that they are not subject to personal jurisdiction in Montana based solely on their appointment of a registered agent. Section 35-7-115, MCA.
¶ 20 Plaintiffs argue § 35-7-115, MCA, simply prohibits finding jurisdiction based on registration "by itself," and that the combination of (1) registering to do business in Montana and (2) actually conducting business activities in Montana constitutes consent to general personal jurisdiction. They contend a 2011 decision by the Ninth Circuit Court of Appeals, **454King v. American Family Mutual Insurance Company ,
¶ 21 We reject Plaintiffs' argument that BNSF's business activities in Montana, which are insufficient to confer general personal jurisdiction over BNSF, combined with BNSF's appointment of a registered agent for service of process, which does not "by itself create the basis for personal jurisdiction," are somehow, taken together, enough to confer general personal jurisdiction over BNSF. See BNSF , 581 U.S. at ----,
¶ 22 In support of their position, Plaintiffs urge us to follow two pre- International Shoe United States Supreme Court decisions, Neirbo Company v. Bethlehem Shipbuilding Corporation and Pennsylvania Fire Insurance Company v. Gold Issue Mining and Milling Company , contending the cases support their argument. See Neirbo Co. v. Bethlehem Shipbuilding Corporation ,
¶ 23 Further, extending general personal jurisdiction over all foreign corporations that registered to do business in Montana and subsequently conducted in-state business activities would extend our exercise of general personal jurisdiction beyond the narrow limits recently articulated by the Supreme Court. BNSF , Daimler , and Goodyear all explain that subjecting a corporation to general personal jurisdiction everywhere it does business is inconsistent with due process. BNSF , 581 U.S. at ----,
¶ 24 We also recognize that adopting registration-based consent to general personal jurisdiction would render our long-arm statute's specific personal jurisdiction provisions superfluous. M. R. Civ. P. 4(b)(1)(A) provides that a corporation is "subject to the jurisdiction of Montana courts as to any claim for relief arising from ... the transaction of any business within Montana." If a corporation is subject to general personal jurisdiction based on its registration to do business and subsequent in-state business activities, M. R. Civ. P. 4(b)(1)(A) would be unnecessary-a corporation lawfully conducting business activities in Montana would be subject to personal jurisdiction in Montana based on claims arising from its transaction of business anywhere, not only in Montana. We cannot harmonize our long-arm statute's specific personal jurisdiction provisions with Plaintiffs' proposed registration-based consent to general personal jurisdiction.
¶ 25 In light of Montana's registration statutes and the constitutional limitations on the exercise of general personal jurisdiction, we conclude that registering to do business in Montana and subsequently conducting in-state business activities does not amount to consent to general personal jurisdiction in Montana. BNSF's contacts to Montana are not significant enough to render it at home for purposes of general personal jurisdiction, Plaintiffs' claims do not arise from BNSF's activity in Montana for purposes of specific personal jurisdiction, and BNSF did not consent to personal jurisdiction in Montana. Construing BNSF's motion to dismiss in the light most favorable to Plaintiffs and taking all well-pleaded allegations as true, it appears beyond doubt that no set of facts supports Plaintiffs' claims for relief because BNSF is not subject to personal jurisdiction in Montana on Plaintiffs' claims. See Buckles , ¶ 9. Accordingly, we affirm the District Court's orders granting BNSF's motions to dismiss Plaintiffs' claims for lack of personal jurisdiction and find the court did not error by denying Plaintiffs jurisdictional discovery.
¶ 26 Finally, we address Plaintiffs' arguments that BNSF is judicially, collaterally, and equitably estopped from denying it consented to personal jurisdiction. Plaintiffs reason that BNSF should be estopped from denying jurisdiction because BNSF consented to personal jurisdiction in Montana in past litigation and because Plaintiffs have spent significant resources litigating their cases up to this point. Those arguments are unpersuasive. BNSF is free to waive its due process protections and consent to personal jurisdiction in any case in which it chooses. The fact that BNSF may have consented to personal jurisdiction in the past does not necessitate it to do so now. We **457recognize that Plaintiffs have spent significant resources litigating their cases thus far and that the District Court stayed the proceedings pending the United States Supreme Court's review of our 2016 decision Tyrrell v. BNSF Ry. Co. ,
CONCLUSION
¶ 27 Based on Montana's registration statutes and the constitutional due process limitations on personal jurisdiction, a foreign corporation does not consent to general personal jurisdiction in Montana when it registers to do business in Montana and then voluntarily conducts in-state business activities. Accordingly, BNSF did not consent to general personal jurisdiction by registering to do business in Montana and voluntarily conducting in-state business activities. Further, BNSF is not estopped from denying it consented to personal jurisdiction. The District Court's orders granting BNSF's motions to dismiss for lack of personal jurisdiction are affirmed.
We concur:
MIKE McGRATH, C.J.
JIM RICE, J.
JAMES JEREMIAH SHEA, J.
INGRID GUSTAFSON, J.
The Legislature adapted § 35-7-115, MCA, from the Model Registered Agents Act (Model Act). At least ten other jurisdictions also adapted their registration statutes from the Model Act. See
See also Brown v. Lockheed Martin Corp. ,