JURIST - Paper Chase: Supreme Court rules New Jersey court lacks personal jurisdiction over UK company

[JURIST] The US Supreme Court [official website, JURIST news archive] in a plurality opinion Monday reversed [opinion, PDF] the New Jersey Supreme Court's grant of personal jurisdiction over a UK company in a products liability suit. Robert Nicastro alleged that he was injured by a defective metal-shearing machine manufactured in the UK by J McIntyre Machinery, Ltd. [corporate website] and sold in the US. McIntyre is incorporated in the UK and sells its machines in the US through a separate company distributor. The Supreme Court of New Jersey [official website] held [opinion text] that McIntyre was subject to specific personal jurisdiction in New Jersey for injuries sustained there under a "stream of commerce" theory where the company knew or reasonably should have known that its products would be sold throughout the US. Justice Anthony Kennedy wrote the plurality opinion, relying on Justice Sandra Day O'Connor's opinion in Asahi Metal Industries v. Superior Court [opinion text], holding that McIntyre had not sufficiently directed its business toward New Jersey to subject it to personal jurisdiction:

Recall that respondent's claim of jurisdiction centers on three facts: The distributor agreed to sell J. McIntyre's machines in the United States; J. McIntyre officials attended trade shows in several States but not in New Jersey; and up to four machines ended up in New Jersey. The British manufacturer had no office in New Jersey; it neither paid taxes nor owned property there; and it neither advertised in, nor sent any employees to, the State. Indeed, after discovery the trial court found that the defendant does not have a single contact with New Jersey short of the machine in question ending up in this state. These facts may reveal an intent to serve the U.S. market, but they do not show that J. McIntyre purposefully availed itself of the New Jersey market.

Justice Stephen Breyer concurred, joined by Justice Samuel Alito, deprived the plurality of a majority opinion agreeing that McIntyre was not subject to personal jurisdiction but limited his decision to prior precedent. Breyer warned that the court should refrain from going any further because this case "does not implicate modern concerns, and because the factual record leaves many open questions, this is an unsuitable vehicle for making broad refashion basic jurisdictional rules." Three justices dissented in an opinion by Justice Ruth Bader Ginsburg's arguing a foreign company that sells its products in the US without restriction should not be able to avoid liability for deficient products simply because it uses a separate US distributor.

The Supreme Court also decided another personal jurisdiction issueMonday . The court ruled [opinion, PDF] unanimously in Goodyear v. Brown [Cornell LII backgrounder; JURIST report] that foreign subsidiaries of the American corporation Goodyear Tire and Rubber Company [corporate website] are subject to neither specific nor general personal jurisdiction in North Carolina. In that case, two North Carolina teenagers were killed in a bus accident in France when a tire manufactured in Turkey malfunctioned. Opposite McIntyre, in that case Justice Ginsburgh wrote the majority opinion holding that North Carolina lacked specific personal jurisdiction over the foreign subsidiaries, because the cause of action did not arise out of or relate to any contacts between the suit and the forum state. Further, the court held there was no general personal jurisdiction because there was no "continuous and systematic" affiliation with North Carolina.