U.S. Chamber Institute for Legal Reform opposes Illinois personal jurisdiction proposal

The U.S. Chamber Institute for Legal Reform has announced its opposition to a proposed amendment in Illinois that would adopt a "consent-by-registration" theory of personal jurisdiction.

According to Heyl Royster, House Amendment No. 2 to Senate Bill 26, introduced by Illinois Representative Jay Hoffman, proposes a significant change to the state's legal framework by shifting from a "specific jurisdiction" to a "general jurisdiction" model. This amendment would allow Illinois courts to hear cases against any out-of-state company registered in the state, regardless of whether the lawsuit has any connection to Illinois or involves out-of-state plaintiffs. The proposed legislation has raised concerns among business groups and legal experts about the potential for increased litigation and the burden it may place on companies operating in Illinois.

As reported by JD Supra, the proposed amendment in Illinois mirrors legislation passed in New York in 2024, which was ultimately vetoed by Governor Kathy Hochul. The New York bill sought to establish a similar "consent-by-registration" framework, requiring foreign corporations to consent to general jurisdiction in New York courts simply by registering to do business in the state. Hochul's veto was based on concerns that such a law would overburden New York's courts and deter out-of-state corporations from conducting business in the state due to the increased risk of litigation.

According to the American Tort Reform Association (ATRA), the proposed amendment in Illinois has been condemned by a coalition of business and legal organizations, labeling it as "one of the worst bills of the year." The coalition argues that the amendment would open the floodgates for out-of-state plaintiffs to sue out-of-state companies in Illinois courts over incidents with no connection to the state, leading to a surge in litigation and increased costs for businesses. ATRA emphasizes that such a legal environment could deter companies from operating in Illinois, negatively impacting the state's economy.

According to the U.S. Chamber of Commerce, its affiliate, the U.S. Chamber Institute for Legal Reform (ILR), is dedicated to advocating for legal policies that reduce excessive litigation and promote fairness in the civil justice system. The ILR engages in research, public education, and lobbying efforts to support legal reform initiatives at various levels. Its mission is to champion a fair legal system that fosters economic growth and opportunity.