Delaware Supreme Court Clarifies Grounds for Jurisdiction

June 2016


In Genuine Parts Company v. Cepec, the DelawareSupreme Court held that the provisions of Delaware’sGeneral Corporation Law (DGCL) requiring foreigncorporations to register to qualify to do business inthe State of Delaware and to appoint an agent forservice of process do not, of themselves, operate tosubject the foreign corporation to general jurisdictionin Delaware. The Court in Genuine Parts thusoverturned its decades-old opinion in Sternberg v.O’Neil  to the extent it held that the registrationstatutes would result in a foreign corporation, merelyby qualifying to do business in Delaware, consentingto general jurisdiction in Delaware. Noting thatreliance on Sternberg for that proposition was not“tenable” after the U.S. Supreme Court’s opinionin Daimler AG v. Bauman, the Delaware SupremeCourt in Genuine Parts set out to adopt a rule thatrecognizes the nature of modern commerce andavoids unduly burdening corporations with nationaland international operations.

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