Once we have decided that there is a statutory basis for personal jurisdiction, we then proceed
to the second step of the two-step dance which is to ask whether exercising jurisdiction
would comply with the Constitution.
Recall that the Due Process Clause of the Fourteenth Amendment provides that a state
"shall [not] deprive any person of life, liberty, or property, without due process of law."
In International Shoe v. Washington, the Supreme Court held that "due process requires only
that, in order to subject a defendant to a judgment in personam, if he be not present
within the territory of the forum, he have certain minimum contacts with it such that
the maintenance of the suit does not offend 'traditional notions of fair play and substantial
justice.'"
Therefore, there are two components to the constitutional analysis: minimum contacts
and fairness.
The Supreme Court has written that the inquiry into whether the minimum contacts test and
due process are satisfied depends upon the "quality and nature of the activity."
It might help then to think of minimum contacts as more of a continuum.
At the far left of the continuum is "no contacts."
We know that if a defendant has no contacts with the forum state, then a court cannot
exercise personal jurisdiction because it fails the minimum contacts test.
However, if a defendant's contacts with the forum state are "isolated and sporadic," then
a court may exercise personal jurisdiction but only if the claim arises out of the defendant's
contacts.
This type of jurisdiction, known as specific in personam jurisdiction, requires that the
defendant's contact with the forum state be purposeful and intentional, rather than merely
fortuitous or unintended.
At the far right of the continuum is a defendant whose contacts with the forum state are "systematic
and continuous."
If a defendant's contacts with the forum are continuous and systematic, then a court may
exercise personal jurisdiction regardless of whether the claim arises out of the defendant's
contact with the forum state.
Jurisdiction based on this type of contact with the forum eventually became known as
general in personam jurisdiction.
Examples include presence within the state when served with process and citizenship or
domicile in the state (or incorporation or principal place of business for corporations).
The International Shoe Court did not provide a list of what constitutes sufficient minimum
contacts to support a finding of personal jurisdiction.
However, the Supreme Court's cases after International Shoe have made clear that there are two prongs
to the minimum contacts test.
The first prong is that the defendant must have purposefully availed herself of the laws
and benefits of the forum state (i.e. purposeful availment); that is the contacts with the
forum state must not be accidental or inadvertent.
The defendant's action must be intentionally directed into the forum state.
Examples include doing business in the state or driving on the state's roads.
There has been disagreement about the meaning or requirements of purposeful availment, especially
in cases in which the defendant is a downstream retailer or out-of-state manufacturer whose
product finds its way into the forum state.
These are known as "stream of commerce" cases and most often deal with products liability
questions.
In these cases, the debate centers on whether mere awareness or foreseeability that the
defendant's product will reach the forum state is sufficient to establish that the defendant
purposefully availed herself of the forum state's laws and privileges.
In Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102 (1987), a Japanese company sold
tire valves to a Taiwanese tire company.
The Taiwanese company's tires were eventually sold in California where, through a defect
in the tire valve, they caused a motorcycle accident.
The question in the case was whether the Japanese company could be sued in California for products
liability relating to its allegedly faulty tire valves.
The Supreme Court split evenly on this issue.
Four justices led by Justice Brennan held that putting a product in the stream of commerce—regardless
of whether the manufacturer knows that the product will reach the forum state—is sufficient
to establish purposeful availment.
Four other justices led by Justice O'Connor held that "mere placement of a product into
the stream of commerce" is not sufficient to constitute purposeful availment, "even
if done with an awareness that the stream will sweep the product into the forum."
In 2011, the Court clarified its position on purposeful availment in J. McIntyre Machinery
v. Nicastro.
In that case, the Court held in a 6-3 decision that a British manufacturer could not be subjected
to personal jurisdiction in New Jersey because the manufacturer had not advertised in, sent
goods to, or in any relevant sense targeted New Jersey.
The majority in Nicastro rejected Justice Brennan's approach in Asahi that fairness
and foreseeability should be the touchstones of purposeful availment and instead embraced
Justice O'Connor's approach which requires that the defendant's contacts be purposefully
directed toward the forum state.
In Nicastro, the majority said it was not sufficient that the foreign manufacturer targeted
the U.S. market; to sustain a finding of purposeful availment, the manufacturer would have had
to target New Jersey specifically.
The "stream of commerce" area of personal jurisdiction law is far from settled.
But for now, it seems clear that the touchstone of purposeful availment is deliberate, intentional,
and conscious targeting of the forum state by the defendant.
The second prong of minimum contacts is that the defendant must have known or reasonably
anticipated that her activities in the forum made it foreseeable that she might be haled
into court there.
Foreseeability alone is not sufficient.
In World-Wide Volkswagen Corp v. Woodson, 444 U.S. 286 (1980), the Court held that a
New York car dealership could not be sued in Oklahoma for injuries arising out of an
accident in Oklahoma involving a car the dealer sold in New York.
The Court held that, although it is "foreseeable" that cars sold in New York might travel to
and cause injury in Oklahoma, the foreseeability that matters is not the "mere likelihood"
that the product will find its way into the forum state.
Rather, to establish foreseeability the defendant's conduct and connection with the forum must
be such that he should reasonably anticipate being haled into court there.
The second component of the constitutional analysis is that exercising personal jurisdiction
over the defendant must comply with "traditional notions of fair play and substantial justice."
In Asahi, the Supreme Court set forth five factors that it thought relevant in determining
whether tradition notions of fair play and substantial justice are satisfied.
The five factors are the burden on the defendant; the interests of the forum state in the litigation;
the interest of the plaintiff in litigating the matter in that state; interstate efficiency;
and interstate policy interests.
It should be noted that, while the Asahi factors and fairness balancing are important, they
are not sufficient by themselves to sustain a finding of personal jurisdiction.
That is to say, if the minimum contacts test is not satisfied, personal jurisdiction is
defeated regardless of the Asahi factors.
You should now have a good understanding of the statutory and constitutional limitations
of in personam jurisdiction But what happens if a court does not have
in personam jurisdiction over a defendant?
Does this mean that the plaintiff is out of luck?
Or is there another way that a court can find personal jurisdiction over a defendant?
This is where the other two types of personal jurisdiction--in rem and quasi in rem jurisdiction--come
in handy.
They allow a court to exercise personal jurisdiction over a defendant if the defendant owns property
in the forum state.
But as with in personam jurisdiction, there are limitations on in rem and quasi in rem,
which we'll talk about in rem and quasi in rem in the next clip.
But first, a short quiz.