In Chavez v. Bridgestone Ams. Tire Operations, LLC, the New Mexico Supreme Court addressed whether a foreign corporation consents to general jurisdiction when it registers to do business and appoints a registered agent, in accordance with the New Mexico Business Corporation Act ("BCA"). Nearly 30 years prior, the New Mexico Court of Appeals held that, by registering to do business in New Mexico under the BCA, a corporation consents to general jurisdiction in the state. Werner v. Wal-Mart Stores, Inc., 861 P.2d 207 (N.M.C.A. 1993). However, the Chavez court held that the reasoning in the prior case was "outmoded" and that a foreign corporation does not consent to general jurisdiction by complying with the BCA.
The case before the court involved four interlocutory appeals from orders denying motions to dismiss for lack of personal jurisdiction. Each of the defendants was a manufacturer of automobiles and component parts. The plaintiffs in the various cases included residents of New Mexico injured out of state, nonresidents injured in state, and residents injured in state. 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 involved in the claims. The Court of Appeals had affirmed the denials of the motions to dismiss, finding the defendants subjected themselves to general personal jurisdiction by registering to do business under the BCA.
On appeal, the defendants argued that the BCA does not require consent to jurisdiction and any exercise of jurisdiction would violate their due process rights, create an unconstitutional condition by requiring a waiver of due process rights as a condition of transacting business in the state, and violate the Commerce Clause.
Declining to comment on the constitutional challenges, the court held that the BCA, "as a matter of statutory construction," does not require a registering foreign corporation to consent to general personal jurisdiction. The court reasoned: "At no point does the BCA state that a foreign corporation consents to general personal jurisdiction by registering and appointing a registered agent." Thus, the court refused to "graft a requirement of this consent onto the language of the statute" because the "Legislature has not clearly expressed an intent to require foreign corporations to so consent."
The court reversed the appellate court and remanded the case with instructions to consider whether there was specific jurisdiction consistent with the U.S. Supreme Court's recent Ford decision. This is yet another case illustrating the disparate outcomes courts have reached when considering whether registering to do business under a given state's registration statue results in a consent to general jurisdiction – this time, the plain language of the statute was enough for the court to find in favor of the foreign defendants.
Chavez v. Bridgestone Ams. Tire Operations, LLC, 2021 N.M. LEXIS 74 (N.M. Nov. 15, 2021).
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