US Supreme Court: in-house counsel should be located near the “nerve center”

This lawyer manqué rarely gets to cite Supreme Court decisions so when I read in Corp. Counsel, Almanac 2010 at 13, about a February decision, I seized the opportunity. The Court clarified a conflict among the federal circuits as to how to define a company’s “principal place of business” for purposes of jurisdiction. Unsurprisingly, at least when you see all things through the lens of the internal legal staff, the high court held that judges need to look for the corporation’s “nerve center” – typically the location of its headquarters.

A few companies have so globalized their operations and the locations of their executives that the nerve center may be brain-like – distributed all over but coordinated. Overwhelmingly, though, companies do have a geographic nerve center, where most of the executive neurons fire, and it is there that a large portion of the senior lawyers should be based.

Thank you, all nine Justices, for ruling on this important issue of law department management.

In the spirit of court decisions, let me cite my blog posts that have referred to the US Supreme Court (See my post of Feb. 16, 2006: data visualization and Supreme Court citations; April 1, 2007: straight from clerking for a Supreme Court Justice to General Counsel; May 8, 2007: Charles James and Chevron’s US Supreme Court argument; May 21, 2007: decision on novelty of patents; Nov. 10, 2007: Bradwell v. Illinois; May 3, 2008: Justice Thomas worked in-house at Monsanto; June 15, 2008: Supreme Court decisions that significantly affect law department workload; Feb. 24, 2009: power law distribution of cases cited by the Court; June 30, 2010: allowance rates on patents plummeted after decision; and Nov. 3, 2010: amicus curiae briefs by law departments.).

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