If a manufacturer targets the United States market for the sale of its product, knowing that its product will be purchased by a forum state consumer, can that manufacturer be subjected to jurisdiction in the forum state without more conduct specifically directed toward the forum state? In Asahi Metal Indus. Co., Ltd. v. Superior Court, the Supreme Court split 4 to 4 on this question. Justice Brennan “thought it was enough that a defendant knew its product was going to a forum and that the defendant benefitted from it.” Justice O’Connor rejected this approach in favor of “a heightened test requiring more evidence that the defendant was intentionally trying to serve the forum.” U.S. Supreme Court Shifts Basic Personal Jurisdiction Rules.
In June 2011, the Supreme Court decided two stream of commerce cases supporting the Justice O’Connor view in Asahi; only one will be discussed here. For those of us who took Professor Mushlin’s Civ. Pro. exam last Spring, the facts of J. McIntyre Machinery, Ltd. v. Nicastro should be familiar: A “three-ton metal shearing machine” manufactured by McIntyre “severed four fingers on Robert Nicastro’s right hand.” Nicastro filed a products liability action against McIntyre in New Jersey Superior Court. McIntrye is a British corporation and has “no office in New Jersey; it neither paid taxes or owned property there; and it neither advertised in, nor sent any employees to, the State.” Rather, McIntyre’s only contact with New Jersey was the metal shearing machine itself, which an independent distributor sold to Nicastro’s employer.
The New Jersey Supreme Court took the Justice Brennan approach, ruling that McIntyre is subject to jurisdiction in New Jersey because it was foreseeable that its product would end up in New Jersey. The United States Supreme Court reversed, finding that at no time did McIntyre “engage in any activity in New Jersey that reveal[ed] an intent to invoke or benefit from the protection of its laws…[I]it is the defendant’s actions, not his expectations, that empower a State’s courts to subject him to judgment.”
What do you think about Nicastro? Certainly there is an international interest in not subjecting a foreign entity to United States Jurisdiction. Doesn’t it make sense that in today’s international trade environment we have clearly established rules for when a foreign manufacturer can be hailed into federal court? On the other hand, the United States has an interest in protecting its citizens and in locating a forum to redress grievances. Doesn’t Nicastro cut against these interests by allowing a foreign entity to avoid liability in the U.S., even when it knows its products are being marketed here? Professor Jack Baldwin LeClair, Deputy Chair of Law and Director of the M.A. in Law and Governance at Montclair State University comments on the decision: “Placing a time bomb in a river is one thing but wanting it to kill someone is, apparently, something else entirely.”