Jurisdictional Requirements to Sue An Out-Of-State Company

Before an out-of-state company can be sued in Georgia, there are certain requirements that must be met in order for the Georgia courts to have jurisdiction over the out-of-state company.

O.C.G.A. § 9-10-91(1) “grants Georgia courts the unlimited authority to exercise personal jurisdiction over any non resident who transacts any business in this [s]tate.” Recognizing that “this statutory language would expand the personal jurisdication of Georgia courts beyond that permitted by constitutional due process,” the Court “construed subsection (1) as reaching only to the maximum extent permitted by procedural due process. Innovative Clinical & Consulting Svcs., v. First Nat. Bank of Ames, Iowa, 279 Ga. 672 (620 S.E.2d 352)(2005).

The question is whether the Defendant could reasonably expect to be haled into court in a particular forum based on its contacts with the State. This inquiry consists of a three-part test: “Jurisdiction exists if (1) the nonresident defendant has purposefully done an act or consummated a transaction in Georgia, (2) the cause of action arises from or is connected with the act or transaction, and (3) the Georgia court’s exercise of jurisdiction does not offend traditional fairness and substantial justice. Beasley v. Beasley, 260 Ga. 419 (396 S.E.2d 222) (1990), Gateway Atlanta Apts. V. Harris, 290 Ga. App. 772, 779(3)(a)(660 S.E.2d 750)(2008).

Accordingly, before a nonresident may be sued in Georgia, such nonresident “must have purposefully directed its activities at residents of the forum, and the litigation must result from alleged injuries that arise out of or relate to those activities.” Stuart v. Peykan, Inc., 261 Ga. App. 46, 48 (1) (581 S.E.2d 609)(2003).

The first two elements are used to determine whether the nonresident defendant has established the minimum contacts necessary for a Georgia court to exercise personal jurisdiction. Beasley v. Beasley, 260 Ga. 419, 421 (396 S.E.2d 222) (1990). And the Court in Gust v. Flint, 257 Ga. 129 (356 S.E.2d 513)(1987), reiterated the rule that the statute requires the out-of-state defendant to do certain acts within the State of Georgia before he can be subjected to personal jurisdiction.

Gust; therefore, holds that a nonresident “must do certain acts” as delineated by the statute before the nonresident could be subjected to personal jurisdication in Georgia. Gust v. Flint, 257 Ga. 129 (356 S.E.2d 513)(1987).

Under subsection (3) a Georgia court may exercise personal jurisdiction over a nonresident who commits a tortious injury in Georgia caused by an act or omission outside Georgia only if the tortfeasor “regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this state.” Gust, at 355.

Due process requires that individuals have fair warning that a particular activity may subject them to the jurisdiction of a foreign sovereign. Before a nonresident may be sued in Georgia, such nonresident “must have purposefully directed its activities at residents of the forum, and the litigation must result from alleged injuries that arise out of or relate to those activities. Stuart v. Peykan, Inc., 261 Ga. App. 46, 48 (1) (581 S.E.2d 609)(2003).

If you have questions or would like to schedule a consultation call VANJOHNSON LAW FIRM, LLC, today at (404) 551-2428, and speak with Attorney Anthony Overton Van Johnson. www.vanjohnsonlaw.us