Asahi Metal Industry Co. v. Superior Court
Encyclopedia
Asahi Metal Industry Co. v. Superior Court, 480
U.S. 102
(1987), decided on February 24, 1987, was a case
decided by the United States Supreme Court, in which the court decided whether a foreign corporation
, by merely being aware that its products
could end up in the forum state and into the American
"stream of commerce
" which later caused injuries, satisfied the minimum contact necessary to satisfy jurisdictional due process
requirements. The court was unanimous in the result, but issued a fractured decision with Associate Justice Sandra Day O'Connor
writing for a plurality of the court.
used in the manufacture of motorcycle
wheels
. These valves were bought by Cheng Shin Rubber Industrial Co., a Taiwan
ese distributor
. One of these valves was alleged to have failed, causing an accident in California
. As a result of the accident the driver of the motorcycle sustained serious injuries and his wife, who was riding on the motorcycle as a passenger, was killed. The accident victim sued Cheng Shin in a California state
court, and Cheng Shin in turn filed a third-party complaint (impleader) seeking indemnification from Asahi. Asahi contested California's personal jurisdiction over Asahi, but the California courts found jurisdiction based on Asahi's alleged awareness of the international distribution of its products. Specifically, Asahi moved to quash Cheng Shin's summons
. The California Superior Court denied the motion but the Court of Appeals issued a writ of mandamus to the state of California telling them to quash the summons. The California Supreme Court reversed this decision, leading Asahi to appeal to the United States Supreme Court.
The Court found that in this case, the burden on the defendant was severe based on both the geographic distance and legal dissimilarities between Japan and the United States. Cheng Shin was not a California resident, diminishing California's interest in the case. Cheng Shin also did not show that it would be inconvenienced if the case for indemnification against Asahi were heard in Japan or Taiwan instead of California. Finally, neither interstate efficiency nor interstate policy interests would be served by finding jurisdiction.
Because an assertion of jurisdiction would disturb the "traditional notions of fair play
and substantial justice
," the decision of the California Supreme Court was reversed and the judgment of California Court of Appeal (California's intermediate appellate court) was effectively reinstated.
480
Year 480 was a leap year starting on Tuesday of the Julian calendar. At the time, it was known as the Year of the Consulship of Basilius without colleague...
U.S. 102
102
Year 102 was a common year starting on Saturday of the Julian calendar. At the time, it was known as the Year of the Consulship of Ursus and Sura...
(1987), decided on February 24, 1987, was a case
Legal case
A legal case is a dispute between opposing parties resolved by a court, or by some equivalent legal process. A legal case may be either civil or criminal...
decided by the United States Supreme Court, in which the court decided whether a foreign corporation
Corporation
A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...
, by merely being aware that its products
Product (business)
In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce ' lead or bring forth'. Since 1575, the word "product" has referred to anything produced...
could end up in the forum state and into the American
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
"stream of commerce
Commerce
While business refers to the value-creating activities of an organization for profit, commerce means the whole system of an economy that constitutes an environment for business. The system includes legal, economic, political, social, cultural, and technological systems that are in operation in any...
" which later caused injuries, satisfied the minimum contact necessary to satisfy jurisdictional due process
Due process
Due process is the legal code that the state must venerate all of the legal rights that are owed to a person under the principle. Due process balances the power of the state law of the land and thus protects individual persons from it...
requirements. The court was unanimous in the result, but issued a fractured decision with Associate Justice Sandra Day O'Connor
Sandra Day O'Connor
Sandra Day O'Connor is an American jurist who was the first female member of the Supreme Court of the United States. She served as an Associate Justice from 1981 until her retirement from the Court in 2006. O'Connor was appointed by President Ronald Reagan in 1981...
writing for a plurality of the court.
Facts
Asahi Metal Industry Co. was an international corporation based in Japan, which manufactured a valveValve
A valve is a device that regulates, directs or controls the flow of a fluid by opening, closing, or partially obstructing various passageways. Valves are technically pipe fittings, but are usually discussed as a separate category...
used in the manufacture of motorcycle
Motorcycle
A motorcycle is a single-track, two-wheeled motor vehicle. Motorcycles vary considerably depending on the task for which they are designed, such as long distance travel, navigating congested urban traffic, cruising, sport and racing, or off-road conditions.Motorcycles are one of the most...
wheels
Wheel
A wheel is a device that allows heavy objects to be moved easily through rotating on an axle through its center, facilitating movement or transportation while supporting a load, or performing labor in machines. Common examples found in transport applications. A wheel, together with an axle,...
. These valves were bought by Cheng Shin Rubber Industrial Co., a Taiwan
Taiwan
Taiwan , also known, especially in the past, as Formosa , is the largest island of the same-named island group of East Asia in the western Pacific Ocean and located off the southeastern coast of mainland China. The island forms over 99% of the current territory of the Republic of China following...
ese distributor
Distributor
A distributor is a device in the ignition system of an internal combustion engine that routes high voltage from the ignition coil to the spark plugs in the correct firing order. The first reliable battery operated ignition was developed by Dayton Engineering Laboratories Co. and introduced in the...
. One of these valves was alleged to have failed, causing an accident in California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
. As a result of the accident the driver of the motorcycle sustained serious injuries and his wife, who was riding on the motorcycle as a passenger, was killed. The accident victim sued Cheng Shin in a California state
U.S. state
A U.S. state is any one of the 50 federated states of the United States of America that share sovereignty with the federal government. Because of this shared sovereignty, an American is a citizen both of the federal entity and of his or her state of domicile. Four states use the official title of...
court, and Cheng Shin in turn filed a third-party complaint (impleader) seeking indemnification from Asahi. Asahi contested California's personal jurisdiction over Asahi, but the California courts found jurisdiction based on Asahi's alleged awareness of the international distribution of its products. Specifically, Asahi moved to quash Cheng Shin's summons
Summons
Legally, a summons is a legal document issued by a court or by an administrative agency of government for various purposes.-Judicial summons:...
. The California Superior Court denied the motion but the Court of Appeals issued a writ of mandamus to the state of California telling them to quash the summons. The California Supreme Court reversed this decision, leading Asahi to appeal to the United States Supreme Court.
Holding
The Supreme Court applied a five-factor test in determining whether "traditional notions of fair play" would permit the assertion of personal jurisdiction over a foreign (meaning out-of-state) defendant:- What is the burden on the defendant?
- What are the interests of the forum state in the litigation?
- What is the interest of the plaintiff in litigating the matter in that state?
- Does the allowance of jurisdiction serve interstate efficiency?
- Does the allowance of jurisdiction serve interstate policy interests?
The Court found that in this case, the burden on the defendant was severe based on both the geographic distance and legal dissimilarities between Japan and the United States. Cheng Shin was not a California resident, diminishing California's interest in the case. Cheng Shin also did not show that it would be inconvenienced if the case for indemnification against Asahi were heard in Japan or Taiwan instead of California. Finally, neither interstate efficiency nor interstate policy interests would be served by finding jurisdiction.
Because an assertion of jurisdiction would disturb the "traditional notions of fair play
Fair Play
Fair Play or Fairplay usually refers to Sportsmanship.It may also refer to:* Fair and unfair play, in cricket* The Fair Play for Cuba Committee, an activist group in the United States early in 1960...
and substantial justice
Justice
Justice is a concept of moral rightness based on ethics, rationality, law, natural law, religion, or equity, along with the punishment of the breach of said ethics; justice is the act of being just and/or fair.-Concept of justice:...
," the decision of the California Supreme Court was reversed and the judgment of California Court of Appeal (California's intermediate appellate court) was effectively reinstated.
See also
- List of United States Supreme Court cases, volume 480
- List of United States Supreme Court cases
- Lists of United States Supreme Court cases by volume
- List of United States Supreme Court cases by the Rehnquist Court