Rethinking Personal Jurisdiction in New York

The century-old New York rule of establishing personal jurisdiction over a corporation or other entity that obtained a license to do business in New York has changed, so says the New York Appellate Division, Second Department in Aybar v. Aybar, following the U.S. Supreme Court decision in Daimler v. Bauman, 571 US 117 (2014). This case is worth reading. Both Ford and Goodyear, which have licenses to do business in New York and have hundreds of dealerships, manufacturing plants, and other permanent, systemic contacts with New York were able to avoid general jurisdiction of a New York court for their alleged negligence that caused a fatal car accident that occurred outside of New York. The Second Department held that, as a matter of law, obtaining a license to do business in New York does not, despite a century of case law holding otherwise that started with a seminal case by Justice Cardozo, constitute consent to be subject to jurisdiction by a New York court. Ford and Goodyear were successful in having the case against them dismissed on personal-jurisdiction grounds. 

John P. Amato is a litigation partner with Hahn & Hessen LLP in New York, New York.

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