Biden DOJ Backing Norfolk Southern’s Bid To Block Lawsuits
Corporations love to incorporate in Delaware to take advantage of their friendly business court system & lax regulations – even if they have no employees in Delaware. That's why 68% of Fortune 500 companies are registered in Delaware.
Why Incorporate In Delaware? Benefits & Considerations:
What do 68% of Fortune 500 companies and 93% of all U.S.-based initial public offerings have in common? They’re all registered in Delaware—and many at the same nondescript brick building on North Orange Street.
Like corporations, regular people have a right to “pick their state” when they file a lawsuit. It is common for plaintiffs to choose a more friendly state like Pennsylvania (just like corporations choose Delaware):
The lawsuit in question, filed initially in a Pennsylvania county court in 2017, deals with a state law that permits plaintiffs to file suit against any corporation registered to do business there, even if the actions that gave rise to the case occurred elsewhere.
Norfolk Southern is asking the Supreme Court to throw out Pennsylvania's law, restrict where corporations can be sued, & allow corporations to have all the power when it comes to lawsuits. It would severely hamper efforts of East Palestine, Ohio victims to get justice:
Such a decision could affect lawsuits filed by residents exposed to hazardous chemicals as the result of accidents in other states — such as the East Palestine, Ohio, derailment disaster, which occurred five miles west of the Pennsylvania state line.
“[Norfolk Southern] might say, ‘You can only sue us in Ohio or Virginia [where Norfolk Southern is headquartered],’ even if you were injured at your home in Pennsylvania from an accident that took place five miles away in Ohio,” Nelson said.
The case in question is of a former Norfolk Southern carman Robert Mallory who was exposed to toxic chemicals & asbestos on the job & was diagnosed with colon cancer. Mallory filed the suit in Pennsylvania, because Pennsylvania is a “consent-by-registration” state. Where corporations doing business in the state are consenting to be governed by that state's courts. Norfolk Southern, the Chamber of Commerce & Biden's DOJ want to make Pennsylvania's law illegal:
In 2016, former Norfolk Southern carman Robert Mallory was diagnosed with colon cancer. In a lawsuit filed the following year, Mallory alleged that his illness resulted from exposure to asbestos and other toxic chemicals on the job — and that the railroad failed to provide safety equipment and take other steps to protect him.
Mallory filed the suit in the Philadelphia County Court of Common Pleas, even though he had never worked in the state. He did so, according to Keller, the lawyer representing him before the Supreme Court, because “his lawyers were from Pennsylvania and he thought he would get the fairest access to justice there.”
Pennsylvania has what’s known as a “consent-by-registration” statute — something states have had on the books since the early 19th century — which stipulates that when corporations register to do business in the state, they are also consenting to be governed by that state’s courts. Norfolk Southern asserts that being forced to defend the case in Pennsylvania would pose an undue burden, thereby violating its constitutional right to due process.
The fact that Biden's DOJ is backup up Norfolk Southern was shocking even to Supreme Court Justice Elana Kagan:
The Biden administration also weighed in on the side of the corporate lobbying groups — a fact that apparently confounded Justice Elena Kagan, who was appointed by President Barack Obama. During oral arguments last fall, she specifically asked Deputy Solicitor General Curtis Gannon why the government had chosen to get involved in the case.
“Mr. Gannon, the Solicitor General has a choice whether to participate in this suit or not, and so please don’t take this as at all a criticism,” Kagan said. “It’s genuine interest and curiosity. What is it about this suit that has made you decide to participate?”
Gannon responded saying, “We pointed out not just that… the excessive availability of general jurisdiction could cause international concerns for trade with the United States and our commercial interests, but also the petitioner had called into question the constitutionality of a federal statute, and so we thought that it was important to make sure that the court’s decision here wouldn’t implicate the constitutionality of federal statutes.”
Solidarity with Robert Mallory – if corporations can incorporate in Delaware to “choose their state” then so should regular people who have been wronged by these corporations. Thank you to The Lever for their great reporting.