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International Shoe Co. v. Washington Case Brief Summary

Summary of International Shoe Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945).

Facts
International Shoe Co. (D, appellant) was a Delaware corporation with its principle place of business in St. Louis, Missouri. It had no offices in the state of Washington and made no contracts for sale there. International Shoe did not keep merchandise in Washington and did not make deliveries of goods in intrastate commerce originating from the state. International Shoe employed 11-13 salesmen for three years who resided in Washington. Their commissions each year totaled more than $31,000 and International Shoe reimbursed them for expenses. Prices, terms, and acceptance or rejection of footwear orders were established through St. Louis. Salesmen did not have authority to make contracts or collections. The state of Washington brought suit against International Shoe in Washington State court to recover unpaid contributions to the unemployment compensation fund. Notice was served personally on an agent of the defendant within the state and by registered mail to corporate headquarters. The Supreme Court of Washington held that the state had jurisdiction to hear the case and International Shoe appealed.

Issue
Did International Shoes activities in Washington make it subject to personal jurisdiction in Washington courts?

Holding and Rule (Stone)

Yes. Minimum contacts with the forum state can enable a court in that state to exert personal jurisdiction over a party consistent with the Due Process clause. A casual presence of a corporation or its agent in a state in single or isolated incidents is not enough to establish jurisdiction. Acts of agents of the corporation, because of the nature, quality, and circumstances of their commission, may be deemed sufficient. Consent may be implied from the corporations presence and activities in the state through the acts of authorized agents. The activities carried on by defendant corporation in Washington were systematic and continuous rather than irregular or casual. The defendant received the benefits and protection of the laws of the state and is subject to jurisdiction there.

Relevant factors
International Shoe had conducted systematic and continuous business operations in Washington. A large volume of interstate business for the defendant was created through its agents within the state and the corporation received the benefits and protection of Washingtons laws. International Shoe had established agents in the state permanently.

Disposition
Affirmed judgment for the plaintiff.

Pennoyer v. Neff Case Brief Summary

Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1878).

Facts
Mitchell brought suit against Neff to recover unpaid legal fees. Mitchell published notice of the lawsuit in an Oregon newspaper but did not serve Neff personally. Neff failed to appear and a default judgment was entered against him. To satisfy the judgment Mitchell seized land owned by Neff so that it could be sold at a Sheriffs auction. When the auction was held Mitchell purchased it and later assigned it to Pennoyer. Neff sued Pennoyer in federal district court in Oregon to recover possession of the property, claiming that the original judgment against him was invalid for lack of personal jurisdiction over both him and the land. The court found that the judgment in the lawsuit between Mitchell and Pennoyer was invalid and that Neff still owned the land. Pennoyer lost on appeal and the Supreme Court granted certiorari.

Issue
Can a state court exercise personal jurisdiction over a non-resident who has not been personally served while within the state and whose property within the state was not attached before the onset of litigation?

Holding and Rule (Field)

No. A court may enter a judgment against a non-resident only if the party 1) is personally served with process while within the state, or 2) has property within the state, and that property is attached before litigation begins (i.e. quasi in rem jurisdiction).

Since the adoption of the Fourteenth Amendment, the validity of judgments may be directly questioned on the ground that proceedings in a court of justice to determine the personal rights and obligations of parties over whom that court has no jurisdiction do not constitute due process of law. Due process demands that legal proceedings be conducted according to those rules and principles which have been established in our systems of jurisprudence for the protection and enforcement of private rights. To give legal proceedings any validity, there must be a tribunal with legal authority to pass judgment, and a defendant must be brought within its jurisdiction by service of process within the state, or by his voluntary appearance. The substituted service of process by publication in actions brought against non-residents is valid only where property in the state is brought under the control of the court, and subjected to its disposition by process adapted to that purpose, or where the judgment is sought as a means of reaching such property or affecting some interest therein; in other words, where the action is in the nature of a proceeding in rem. The Oregon court did not have personal jurisdiction over Neff because he was not served in Oregon. The courts judgment would have been valid if Mitchell had attached Neffs land at the beginning of the suit. Mitchell could not have done this because Neff did not own the land at the time Mitchell initiated the suit. The default judgment was declared invalid. Therefore, the sheriff had no power to auction the real estate and title never passed to Mitchell. Neff was the legal owner.

Disposition
Judgment for Neff affirmed.

Mullane v. Central Hanover Bank & Trust Co. Case Brief

Summary of Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S. Ct. 652, 94 L. Ed. 865 (1950).

Facts
Central Hanover Bank (P) was the trustee of a common trust fund formed by pooling the assets of a number of smaller trusts. Central Hanover Bank petitioned to the New York Surrogates Court for a judicial settlement of the trust. The only notice provided to beneficiaries was via publication in a newspaper. Mullane (D) was appointed attorney and special guardian for a number of beneficiaries who either were unknown or did not appear.

Procedural History
Mullane objected to the statutory provision for notice by publication, arguing that it was unconstitutional for lack of due process under the Fourteenth Amendment. The Surrogates Court overruled Mullanes objection and the ruling was affirmed on appeal to the New York Supreme Court Appellate Division and the New York Court of Appeals. The United States Supreme Court granted cert.

Issue
Is notice given to out of state parties by publication in a newspaper, when the parties addresses were known, constitutional in light of the Due Process Clause of the Fourteenth Amendment?

Holding and Rule

No. Notice given to out of state parties by publication in a newspaper, when the parties addresses were known, is unconstitutional in light of the Due Process Clause of the Fourteenth Amendment.

Notice must be reasonably calculated to inform known parties affected by the proceedings. However, constructive notice by publication was acceptable with regard to missing or unknown parties or for those whose whereabouts could not be ascertained by due diligence or for whom future interests were too conjectural to be known with certainty.

Disposition
Judgment reversed.

Burger King Corp. v. Rudzewicz Case Brief Summary

Summary of Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985).

Facts
Rudzewicz (D) and MacShara entered into a franchise contract with Burger King Corp. (P) to open a restaurant in Michigan. Burger King was incorporated in Florida and a choice of law clause in the contract indicated that Florida law was controlling. The contract allowed Rudzewicz to use Burger Kings trademarks and service marks for 20 years in Michigan. All financial obligations owed to Burger King were sent to Florida and D received training in Florida. An economic downturn led to decreased sales and Rudzewicz failed to meet his obligations under the contract.

Burger King brought a diversity suit against Rudzewicz in the Southern District of Florida. Rudzewicz and MacShara moved to dismiss on the grounds that the court did not have personal jurisdiction over them because they did not have sufficient minimum contacts with the state. The court denied Rudzewicz motion and ruled that jurisdiction was proper under Floridas long arm statute. The court entered judgment in favor of Burger King and Rudzewicz appealed. On appeal, the court held that while Rudzewicz had sufficient contacts with the state of Florida to satisfy the states long arm statute, the exercise of personal jurisdiction was fundamentally unfair and was a violation of due process. Burger King appealed.

Issues
1. Must a plaintiff show that an out of state defendant has both minimum contacts with the forum state and that it is fair and equitable to require a defendant to defend a suit in the state? 2. What factors must the court balance in addressing reasonableness in jurisdictional analysis?

Holding and Rule (Brennan)

1. No. A plaintiff need not show that an out of state defendant has both minimum contacts with the forum state and that it is fair and equitable to require the defendant to defend a suit in the state. 2. The factors the court must balance in addressing reasonableness in an analysis of personal jurisdiction are: (1) the extent of a defendants purposeful interjection in the forum state; (2) the burden on the defendant in defending in the forum; (3) the extent of conflict with the sovereignty of the defendants state; (4) the forum states interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiffs interest in convenient and effective relief; and (7) the existence of an alternative forum. The court held that jurisdiction is proper when the defendants contact proximately results from actions by the defendant such that they create a substantial connection with the forum state. Due Process protects an individuals liberty interests in not being bound by judgments of a forum in which he has established no meaningful contacts, ties, or relations. See International Shoe Co. v. Washington. The court held that there must be fair warning that a particular activity may subject a party to suit in another jurisdiction. SeeShaffer v. Heitner. The fair warning requirement is satisfied when a party has purposefully directed his activities at the forum. See Keeton v. Hustler Magazine, Inc. Parties who reach out and create continuing relationships and obligations in another state are subject to regulation and sanctions in that state for the consequences of their activities. The foreseeability that is critical for due process is that the defendants conduct and connection with the forum are such that he would reasonably anticipate being haled into court there. See World-Wide Volkswagen Corp. v. Woodson. Reasonable anticipation is demonstrated when a party purposefully avails itself of the privilege of conducting activities within the forum thus invoking the benefits and protections of its laws. See Hanson

v. Denckla. Once purposeful availment and minimum contacts are satisfied, the four World Wide factors must be analyzed. Establishing that the defendant has minimum contacts creates a rebuttable presumption that it is fair to require him to defend there. The burden shifts to the defendant to show that it would be unfair to defend in the state. The question of fairness requires a balancing of: the forums interest in the litigation, the plaintiffs interest in efficient and convenient relief, the demands of the federal system as a whole, the best interests of the federal system, and the defendants interest in not having to defend a suit in a remote or disadvantageous forum. The court held that in this case the franchise agreement with Burger King allowed Rudzewicz to benefit from an association with a Florida corporation for twenty years. Rudzewicz had continuing and direct contacts with Burger King. The fact that Rudzewiczs contacts were purposeful allowed the state to exercise personal jurisdiction despite that those contacts were minimal. The contract indicated that Florida law would apply. It cannot be a shock that Burger King would sue Rudzewicz there for a breach of the contract in light of the clear contractual terms of the agreement. Rudzewicz had not shown that he would be unfairly prejudiced or harmed by a trial in Florida and the purposeful involvement of Rudzewicz in the contract met the minimum contact requirements.

Disposition
Judgment for defendant Rudzewicz reversed.

World-Wide Volkswagen Corp. v. Woodson Case Brief Summary

Summary of World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S. Ct. 559, 62 L. Ed. 2d 490 (1980).

Parties
The plaintiffs in the underlying action were the Robinsons. This part of the case involves a request for a writ of prohibition brought by the defendants (Word-Wide Volkswagen and Seaway) against the trial court judge, Woodson.

Facts
The Robinsons (P) purchased an Audi from Seaway Volkswagen, Inc. (D1), a New York car dealership. One year later while driving through Oklahoma, another car hit them from behind, causing a fire which caused severe injuries to Mrs. Robinson and her two children. The Robinsons brought a products liability suit in state court against four parties including Seaway and its distributor, World-Wide Volkswagen Corp. (Ds). The defendants were New York corporations and conducted no business in Oklahoma. The defendants entered special appearances claiming that Oklahoma could not exert in personam jurisdiction over them by virtue of the Due Process Clause of the Fourteenth Amendment. The trial court found that it had jurisdiction and the Oklahoma Supreme Court denied defendants request for a writ of prohibition to restrain the trial judge from exercising in personam jurisdiction over them. The U.S. Supreme Court granted cert.

Issue

In order to exercise personal jurisdiction over a nonresident party, how extensive must the partys contacts be to satisfy due process?

Holding and Rule (White)

The partys contacts with the state must be such that maintenance of the suit does not offend traditional notions of fair play and substantial justice. The relationship between the party and the state must be such that it is reasonable to require the corporation to defend the particular suit which is brought there.

A state court may exercise personal jurisdiction over a party only if the party has minimum contacts with the forum state (see International Shoe Co. v. Washington). The court held that there was a total absence of circumstances that are necessary to permit an exercise of personal jurisdiction. The defendants did not solicit business in Oklahoma through salespersons or advertising reasonably calculated to reach the state. Although it was foreseeable that one of their cars could be involved in an accident in Oklahoma, foreseeability alone is not sufficient for personal jurisdiction under the Due Process Clause. The degree of foreseeability that must exist is not the mere likelihood that a product will find its way into the state, but that the defendants conduct and connection with the state are such that he should reasonably anticipate being haled into court there. Purposeful availment provides clear notice of jurisdiction.

Disposition
Judgment reversed.

Asahi Metal Industry Co. v. Superior Court Case Brief Summary

Summary of Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102, 107 S. Ct. 1026, 94 L. Ed. 2d 92 (1987).

Parties
In Underlying Action: Zurcher, plaintiff; Asahi Metal Industry Co., Cheng Shin, et al., defendants. At Time of Appeal: Cheng Shin had a cross claim pending against Asahi Metal. All other parties had settled. Parties Here: Asahi Metal, plaintiff; Superior Court of California, defendant.

Procedural History
The only parties left in this case at the time of this appeal were co-defendants Asahi Metal and Cheng Shin. This matter involved an appeal of the Superior Courts denial of Asahi Metals motion to quash service of summons (i.e. service of process). Asahi Metal sought a writ of mandate (i.e. writ of mandamus) from the Court of Appeal of the State of California to compel the Superior Court to quash service of summons.

Facts
Mr. Zurcher lost control of his motorcycle and collided with a tractor. He was seriously injured and his passenger, Mrs. Zurcher, was killed. Zurcher alleged that the accident was the result of a defective tire tube which caused his rear wheel to lose air rapidly and explode.

Zurcher brought suit and named as defendants Cheng Shin, the Taiwanese manufacturer of the tire tube, and Asahi Metal Industry Co., the Japanese tire valve assembly manufacturer. Asahi Metal had sold tire valve assemblies directly to Cheng Shin in Taiwan and Cheng Shin then incorporated the valves into motorcycle tires. Cheng Shin sought indemnity from Asahi Metal in the Zurcher suit and filed a cross claim against Asahi and the other defendants. Zurcher eventually settled out of court with all of the defendants leaving Cheng Shins cross claim as the only remaining issue to be decided. Asahi Metal moved to quash the service of summons, claiming that California could not exercise jurisdiction over it because sales to Cheng Shin took place in Taiwan and shipments were sent from Japan to Taiwan. Asahi Metal did no business in California and did not directly import any products to California. Only 1.24% of the companys income came from sales to Cheng Shin and only 20% of Cheng Shins sales in the United States were in California. Cheng Shin testified that that Asahi Metal was told and knew that its products were being sold in California.

Superior Court
The Superior Court found it fair to require Asahi to defend in California and denied Asahi Metals motion to quash service of summons.

Court of Appeals
The Court of Appeals reversed and issued a writ of mandate to compel the Superior Court to grant the motion to quash.

California Supreme Court

On appeal the California Supreme Court reversed again, finding that Asahi Metals intentional act of placing its assemblies into the stream of commerce, together with its awareness that some of them would eventually reach California, were sufficient to support state court jurisdiction under the Due Process Clause. Asahi Metal appealed and the United States Supreme Court granted certiorari.

Issue
Is the mere awareness that a product may reach a remote jurisdiction when put in the stream of commerce sufficient to satisfy the requirement for minimum contacts under the Due Process Clause?

Holding and Rule (OConnor)

No. The mere awareness that a product may reach a remote jurisdiction when put in the stream of commerce is not sufficient to satisfy the requirement for minimum contacts under the Due Process Clause.

Minimum contacts require that there be some act by a party which would purposefully avail itself of the privilege of conducting activities within the forum state. The court held in World-Wide Volkswagen Corp. v. Woodson that a party must do more than intentionally put goods in the stream of commerce even if it expected its products to reach the forum state. Asahi Metal has not purposefully availed itself of the California market. Asahis actions could constitute sufficient minimum contacts if it advertised or marketed its products in California or deliberately designed

them to conform to unique California regulations. Asahi however has not engaged in these activities and has done nothing to indicate that it deliberately wants to see its products used in California. The substantial connection with the forum state necessary for a finding of minimum contacts must come about by an action of the defendant purposefully directed toward the forum state. Even if minimum contacts were to be found, traditional notions of fair play and substantial justice must be examined. Under these facts it would be fundamentally unfair to require Asahi Metal to defend after Californias interest in the suit has been terminated. Zurcher settled the suit and the dispute is now between two nonresident defendants. Jurisdiction is therefore unreasonable.

Disposition
Reversed and remanded.

Burnham v. Superior Court of California Case Brief Summary

Summary of Burnham v. Superior Court of California, 495 U.S. 604, 110 S. Ct. 2105, 109 L. Ed. 2d 631 (1990).

Facts
The Burnhams lived in New Jersey prior to their separation. Mrs. Burnham (P) moved to California and filed for divorce in California state court. Mr. Burnham (D) was visiting California on business when he was served with the divorce papers. The defendants primary reason for visiting California was for business but while there he visited his daughters. His only contacts with California were occasional brief visits for business and to visit his children. In a special appearance Burnham moved to quash service, contending that his contacts with California were insufficient to confer personal jurisdiction. The Superior Court of California denied the motion and the state court of appeal denied his petition for mandamus, holding that his physical presence and personal service in the state constituted valid grounds for personal jurisdiction. The Supreme Court granted cert.

Issue
Can a state gain personal jurisdiction over a nonresident who was personally served with process while temporarily in the state, if his purpose for being in the state is unrelated to the matter before the court?

Holding and Rule (Scalia)

Yes. A state can gain personal jurisdiction over a nonresident who was personally served with process while temporarily in the state, even if his purpose for being in the state is unrelated to the matter before the court.

It is an established principle that States have jurisdiction over persons physically present in the State. Service of process on a party physically present in a state is not a violation of due process. The purpose for the partys presence within the state is of no concern as long as his presence was voluntary. The court noted that on rare occasions, deviations from the general rule of presence in the state have been permitted. These relate only to suits arising out of an absent defendants contacts with the forum state. In International Shoe Co. v. Washington, the court held that minimum contacts are required in

order to satisfy the due process requirements of fair play and substantial justice. There court held that there was nothing in International Shoe or its progeny that required extending its holding to transient jurisdiction.

Disposition
Judgment affirmed.

Shaffer v. Heitner Case Brief Summary

Summary of Shaffer v. Heitner, 433 U.S. 186, 97 S. Ct. 2569, 53 L. Ed. 2d 683 (1977).

Facts
Greyhound, a Delaware corporation, lost a large antitrust judgment and Heitner (P) initiated a shareholder derivative suit in Delaware against 28 officers and directors of the corporation (i.e. Shaffer, D). Heitner owned one share of Greyhound stock and was a nonresident of Delaware. Heitner filed a motion for sequestration of stock owned by 21 of the defendants in order to obtain quasi-in-rem jurisdiction. The legal situs of the stock was deemed to be in Delaware. The Delaware sequestration statute allowed property within the state to be seized to allow the Delaware court to obtain personal jurisdiction over the owner. Shaffer et al. made a special appearance to challenge the courts jurisdiction on the grounds that the statute was unconstitutional. Shaffer also asserted that there were insufficient contacts to confer jurisdiction. The District Court found that the statute was valid, and did not address the minimum contacts argument due to the finding that the legal presence of the stock in Delaware conferred quasi-in rem jurisdiction.

Issues
1. Can a state obtain personal jurisdiction over a party based on that partys ownership of property in the state? 2. Is quasi in rem jurisdiction subject to the constitutional requirements of minimum contacts?

Holding and Rule (Marshall)

1. No. A state cannot obtain personal jurisdiction over a party based merely on that partys ownership of property in the state. 2. Yes. Quasi in rem jurisdiction is subject to the constitutional requirements of minimum contacts.

Rules
Whether or not a State can assert jurisdiction over a nonresident must be evaluated according to the minimum-contacts standard of International Shoe Co. v. Washington. In rem jurisdiction: due process under the Fourteenth Amendment requires that the basis for jurisdiction must be sufficient to justify exercising jurisdiction over the interests of persons in the thing. The presence of property in a State may allow jurisdiction by providing contacts among the forum State, the defendant, and the litigation; for example, when claims to the property itself are the source of the underlying controversy. Where, as in this case, the property serving as the basis for jurisdiction is completely unrelated to the plaintiffs cause of action, the presence of the property alone, i.e., absent other ties among the defendant, the State, and the litigation, would not support the States jurisdiction.

Delawares assertion of jurisdiction over appellants, based solely as it is on the statutory presence of appellants property in Delaware, violates the Due Process Clause, which does not contemplate that a state may make binding a judgment against an individual or corporate defendant with which the state has no contacts, ties, or relations. Appellants holdings in the corporation do not provide contacts with Delaware sufficient to support jurisdiction of that States courts over appellants. Delaware state-court jurisdiction is not supported by that States interest in supervising the management of a Delaware corporation and defining the obligations of its officers and directors, since Delaware bases jurisdiction, not on appellants status as corporate fiduciaries, but on the presence of their property in the State. Though it may be appropriate for Delaware law to govern the obligations of appellants to the corporation and stockholders, this does not mean that appellants have purposefully availed themselves of the privilege of conducting activities within the forum State. See Hanson v. Denckla. Appellants, who were not required to acquire interests in the corporation in order to hold their positions, did not by acquiring those interests surrender their right to be brought to judgment in the States in which they had minimum contacts.

Discussion
In Mullane v. Central Hanover Bank and Trust we held certain Fourteenth Amendment rights attach once an adverse judgment in rem directly affects the property owner by divesting him of his rights in the property. If jurisdiction over property involves jurisdiction over a persons interests, the proper standard is the minimum contacts standard of International Shoe. This makes the assertion of jurisdiction over the property an assertion of jurisdiction over the person. Thus, all assertions of jurisdiction must be determined according to the standards of International Shoe and its progeny. Delaware has a strong interest in supervising the management of corporations created within its borders. The legislature must assert that interest, however. Delaware is not a fair forum for this litigation because the officers and directors have never set foot in the state and have not purposefully availed themselves of the benefits and protections of the state.

Disposition
Reversed.

Hess v. Pawloski Case Brief Summary

Summary of Hess v. Pawloski, 274 U.S. 352, 47 S. Ct. 632, 71 L. Ed. 1091 (1927).

Facts
Hess (D), a resident of Pennsylvania, negligently struck and injured Pawloski (P) while driving in Massachusetts. Pawloski brought this action against Hess in Massachusetts. The court established personal jurisdiction over Hess under a statute whereby non-resident motorists involved in accidents in Massachusetts consented to the appointment of the Registrar of Motor Vehicles as the drivers agent for service of process. Process was served on the Registrar of Motor Vehicles as Hesss agent and Hess received actual notice of the suit. Hess contested jurisdiction. The trial court and the Supreme Judicial Court on appeal held that the courts jurisdiction was valid. Pawloski won the case on the merits in a jury trial. Hess appealed to the Supreme Court on the grounds that the Massachusetts court did not have personal jurisdiction over him and the method of service of process used violated his due process rights under the Fourteenth Amendment.

Issue
Was the Massachusetts law that stated that out of state drivers gave implied consent to the appointment of the Registrar as agent for service of process constitutional?

Holding and Rule

Yes. A state has the power to legislate that non-residents who use its highways consent to the appointment of a third party as agent for the service of process in that state for actions arising from use of the highways.

Disposition
Affirmed.