Registration to Do Business in New Mexico Is Not Automatic Consent to General Personal Jurisdiction | Schnader Harrison Segal & Lewis LLP

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In Chavez versus Bridgestone Ams. Tire Operations, LLC, the New Mexico Supreme Court considered whether a foreign corporation consents to general jurisdiction when registering to do business and appointing a registered agent, pursuant to the New Mexico Business Corporations Act (“BCA “). Nearly 30 years ago, the New Mexico Court of Appeals ruled that by registering to do business in New Mexico under the BCA, a corporation consents to general state jurisdiction. Werner v Wal-Mart Stores, Inc., 861 P.2d 207 (NMCA 1993). However, the Chavez The court ruled that the reasoning in the previous case was “outdated” and that a foreign company does not consent to general jurisdiction by complying with the LSA.

The case before the court involved four interlocutory appeals from orders dismissing motions to dismiss for lack of personal jurisdiction. Each of the defendants was an automobile and parts manufacturer. Plaintiffs in the various cases included New Mexico residents injured out of state, injured non-residents in state, and injured residents in state. The plaintiffs brought the lawsuits in New Mexico despite the fact that the defendants did not design or manufacture in the state any of the specific products implicated in the claims. The Court of Appeals had upheld the denials of the motions to dismiss, finding that the defendants submitted to general personal jurisdiction by registering to do business under the BCA.

On appeal, the defendants argued that the BCA did not require consent to jurisdiction and that any exercise of jurisdiction would violate their due process rights, create an unconstitutional condition by requiring a waiver of due process rights as condition for doing business in the State, and breaching the Trade Clause.

Declining to comment on the constitutional challenges, the court ruled that the BCA, “as a statutory interpretation,” does not require a registered foreign company to consent to general personal jurisdiction. The court said, “At no time does the BCA declare that a foreign company consents to general personal jurisdiction by registering and appointing a registered agent.” Thus, the court declined to “graft a requirement of such consent onto the wording of the statute” because “the legislator has not clearly expressed the intention to require foreign companies to consent in this way”.

The court overturned the appeals court’s decision and sent the case back with instructions to consider whether there was specific jurisdiction consistent with the recent US Supreme Court ruling. Ford decision. This is another case illustrating the disparate results courts have reached when considering whether registration to do business under a given state’s registration law results in consent to jurisdiction. general – this time the plain language of the law was enough for the court to find in favor of the foreign defendants.

Chavez versus Bridgestone Ams. Tire Operations, LLC, 2021 NM LEXIS 74 (NM 15 Nov 2021).

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