Directions:WRITE a 500-750-word responseon the types of jurisdiction a federal court in the United States has on cases involving International companies. VIEW the caseAsaahi Metal on page 63 of the textbook in addition to researching and citing at least two scholarly journals on this topic. MAKE SURE to include citations and a reference page.The case is belowAsahi Metal Industry, Co. v. Superior Court of California, Solano CountyBACKGROUND AND FACTSAsahi Metal Industry, a Japanese corporation, manu- factured valve assemblies in Japan and sold them to tire manufacturers including Cheng Shin (a Taiwanese corporation) from 1978–1982. Cheng Shin sold tires all over the world, including in California. On September 23, 1978, in Solano County, California, Gary Zurcher was injured riding his motorcycle. His wife was killed. He filed a products liability action against Cheng Shin, the manufacturer of his motorcycle’s tires, alleging that the tires were defective. Cheng Shin filed a cross- complaint seeking indemnification from Asahi. Cheng Shin settled with Zurcher. However, Cheng Shin pressed its action against Asahi. The California Su- preme Court held that California state courts possessed personal jurisdiction over Asahi, and Asahi sought review by the U.S. Supreme Court. The case presented the question of whether a dispute between a Taiwanese company and a Japanese company with the above- described relationship to California should be heard by the California courts. In other words, did the California courts have personal jurisdiction over Asahi?JUSTICE O’CONNORThe placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State. Addi- tional conduct of the defendant may indicate an intent or purpose to serve the market in the forum State, for example, designing the product for the market in the forum State, advertising in the forum State, establish- ing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum State. But a defendant’s awareness that the stream of commerce may or will sweep the productinto the forum State does not convert the mere act of placing the product into the stream into an act purposefully directed toward the forum State.Assuming, arguendo, that respondents have estab- lished Asahi’s awareness that some of the valves sold to Cheng Shin would be incorporated into tire tubes sold in California, respondents have not demonstrated any action by Asahi to purposefully avail itself of the California market. It has no office, agents, employees, or property in California. It does not advertise or otherwise solicit business in California. It did not create, control, or employ the distribution system that brought its valves to California. There is no evidence that Asahi designed its product in anticipa- tion of sales in California. On the basis of these facts, the exertion of personal jurisdiction over Asahi by the Superior Court of California exceeds the limits of due process.The strictures of the Due Process Clause forbid a state court from exercising personal jurisdiction over Asahi under circumstances that would offend “tradi- tional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945), quoting Milliken v. Meyer, 311 457, 463 (1940).We have previously explained that the determina- tion of the reasonableness of the exercise of jurisdic- tion in each case will depend on an evaluation of several factors …Certainly the burden on the defendant in this case is severe. Asahi has been commanded by the Supreme Court of California not only to traverse the distance between Asahi’s headquarters in Japan and the Super- ior Court of California in and for the County of Solano, but also to submit its dispute with Cheng Shin to a foreign nation’s judicial system. The unique burdens placed upon one who must defend oneself in a foreign legal system should have significant weight in asses- sing the reasonableness of stretching the long arm of personal jurisdiction over national borders. When minimum contacts have been established, often the interests of the plaintiff and the forum in the exercise of jurisdiction will justify even the serious burdens placed on the alien defendant. In the present case, however, the interests of the plaintiff and the forum in California’s assertion of jurisdiction over Asahi are slight. All that remains is a claim for indemnification asserted by Cheng Shin, a Taiwanese corporation, against Asahi. The transaction on which the indemnification claim is based took place in Taiwan; Asahi’s components were shipped from Japan to Taiwan. Cheng Shin has not demonstrated that it is more convenient for it to litigate its indemnifi- cation claim against Asahi in California rather than in Taiwan or Japan.Because the plaintiff is not a California resident, California’s legitimate interests in the dispute have considerably diminished. The Supreme Court of Califor- nia argued that the State had an interest in “protecting its consumers by ensuring that foreign manufacturers comply with the state’s safety standards.”…The State Supreme Court’s definition of California’s interest, how- ever, was overly broad. The dispute between Cheng Shin and Asahi is primarily about indemnification rather than safety. Moreover, it is not at all clear at this point that California law should govern the question whether a Japanese corporation should indemnify a Taiwanese corporation on the basis of a sale made in Taiwan and a shipment of goods from Japan to Taiwan.Considering the international context, the heavy burden on the alien defendant, and the slight interests of the plaintiff and the forum State, the exercise of personal jurisdiction by a California court over Asahi in this instance would be unreasonable and unfair.Because the facts of this case do not establish minimum contacts such that the exercise of personal jurisdiction is consistent with fair play and substantial justice, the judgment of Supreme Court of California is reversed, and the case is remanded for further proceedings not inconsistent with this opinion. It is so ordered.Decision. The U.S. Supreme Court reversed the Ca- lifornia Supreme Court and found that there was no jurisdiction. This Supreme Court case is significant be- cause it lists several factors that will be taken into ac- count in determining whether a court has personal jurisdiction.
SP16 – Jurisdictions of a Federal Court in United States
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