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Three countries, one tire – who has jurisdiction? (Asahi Metal Industry Co. v. Superior Court)

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Asahi Metal Industry Co. v. Superior Court

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Gary Zurcher was driving his motorcycle down a California highway when the tire blew and Zurcher crashed. Zurcher sued, among others, Cheng Shin Rubber Industrial Co., Ltd. (Cheng Shin), the Taiwanese company that had manufactured the defective tube in the tire.

Cheng Shin then filed a cross-complaint against Asahi Metal Industry Co. (Asahi), the Japanese manufacturer of the valve assembly, which Cheng Shin blamed for the blowout. All parties’ claims ultimately settled, save Cheng Shin’s against Asahi.

That left a Taiwanese company suing a Japanese company in a California state court. Asahi tried to get the suit thrown out, arguing the court could not exercise jurisdiction without violating the Fourteenth Amendment’s Due Process Clause. The trial court refused, concluding it wasn’t unreasonable to hail an international company to court wherever it did business.

The appellate court reversed, the California Supreme Court reversed again, and finally, the U.S. Supreme Court took up the question.

The Court’s plurality opinion held that there were insufficient minimum contacts to justify the exercise of personal jurisdiction over Asahi. The fact that a foreign business was aware that its products might reach a U.S. state, without more, was not enough to satisfy due process.

Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102 (1987), remains a cornerstone of American civil procedure and illustrates the constitutional limitations on the stream-of-commerce theory of personal jurisdiction.

 

 

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