The Supreme Court Set to Revisit Personal Jurisdiction for the First Time Since the 1980s.
If you’re a foreign manufacturer and have a Facebook page, Twitter account, blog or otherwise have a social media presence in the U.S., you might want to pay close attention to the Supreme Court’s upcoming 2010-2011 term, which kicks off on Monday.
For the first time since the 1980’s, the U.S. Supreme Court will revisit the circumstances under which foreign manufacturers can be sued in the United States.
In today’s brave new interconnected world, there seems to be countless ways for a foreign manufacturer to inadvertently find itself hauled into U.S. courts based on contacts that did not exist in the 1980’s.
While a manufacturer’s contacts with the forum state are only part of the analysis, the quantity, nature and quality of the contacts could be the tipping point for a court to find that exercise of jurisdiction comports with due process.
What makes these cases so interesting is that the lower courts in both reached out and asserted jurisdiction in ways that were fairly dramatic.
Here are the specific issues to be determined by the Court in each case:
In Goodyear Luxembourg Tires v. Brown, the issue is whether a foreign corporation is subject to general personal jurisdiction, on causes of action not arising out of or related to any contacts between it and the forum state, merely because other entities distribute in the forum state products placed in the stream of commerce by the defendant.
In J. McIntyre Machinery v. Nicastro, the issue is whether, consistent with the Due Process Clause and pursuant to the stream-of-commerce theory, a state may exercise in personam jurisdiction over a foreign manufacturer when the manufacturer targets the U.S. market for the sale of its product and that product is purchased by a forum state consumer.
It will be interesting to see how the outcome of these two cases will impact the way foreign manufacturers market their products to the world.
If their target market does not concern U.S. consumers, would it be wise for these manufacturers to have a Facebook page? A Twitter account? A Blog? And if they do, in what language?
This inquiry is relevant. In Goodyear Luxembourg Tires, for example, the North Carolina Supreme Court made note of the fact that the foreign company’s marketing materials were translated into English—a factor that weighed in favor of finding jurisdiction over the foreign manufacturer.
These are just one of the many factors that our nation’s High Court will examine in the context of our brave new interconnected world.
What do you think?