International Shoe v.

State of Washington

No. 107

Argued November 14, 1945

Decided December 3, 1945

326 U.S. 310

APPEAL FROM THE SUPREME COURT OF WASHINGTON

Syllabus

Activities within a State of salesmen in the employ of a foreign corporation, exhibiting samples of
merchandise and soliciting orders from prospective buyers to be accepted or rejected by the
corporation at a point outside the State, were systematic and continuous, and resulted in a large
volume of interstate business. A statute of the State requires employers to pay into the state
unemployment compensation fund a specified percentage of the wages paid for the services of
employees within the State.

Held:

1. In view of 26 U.S.C. 1606(a) , providing that no person shall be relieved from compliance with a
state law requiring payments to an unemployment fund on the ground that he is engaged in
interstate commerce, the fact that the corporation is engaged in interstate commerce does not
relieve it from liability for payments to the state unemployment compensation fund. P. 326 U. S.
315.

2. The activities in behalf of the corporation render it amenable to suit in courts of the State to
recover payments due to the state unemployment compensation fund. P. 326 U. S. 320.

(a) The activities in question established between the State and the corporation sufficient contacts
or ties to make it reasonable and just, and in conformity to the due process requirements of the
Fourteenth Amendment, for the State to enforce against the corporation an obligation arising out of
such activities. P. 326 U. S. 320.

(b) In such a suit to recover payments due to the unemployment compensation fund, service of
process upon one of the corporation's salesmen within the State, and notice sent by registered mail
to the corporation at its home office, satisfies the requirements of due process. P. 326 U. S. 320.

Page 326 U. S. 311

3. The tax imposed by the state unemployment compensation statute -- construed by the state
court, in its application to the corporation, as a tax on the privilege of employing salesmen within
the State -- does not violate the due process clause of the Fourteenth Amendment. P. 326 U. S. 321.

22 Wash.2d 146, 154 P.2d 801, affirmed.

APPEAL from a judgment upholding the constitutionality of a state unemployment compensation

statute as applied to the appellant corporation.

MR. CHIEF JUSTICE STONE delivered the opinion of the Court.

The questions for decision are (1) whether, within the limitations of the due process clause of the
Fourteenth Amendment, appellant, a Delaware corporation, has, by its activities in the State of
Washington, rendered itself amenable to proceedings in the courts of that state to recover unpaid
contributions to the state unemployment compensation fund exacted by state statutes, Washington
Unemployment Compensation Act, Washington Revised Statutes, 9998-103a through 9998-
123a, 1941 Supp., and (2) whether the state can exact those contributions consistently with the
due process clause of the Fourteenth Amendment.

The statutes in question set up a comprehensive scheme of unemployment compensation, the

costs of which are defrayed by contributions required to be made by employers to a state
unemployment compensation fund.

Page 326 U. S. 312

The contributions are a specified percentage of the wages payable annually by each employer for
his employees' services in the state. The assessment and collection of the contributions and the
fund are administered by appellees. Section 14(c) of the Act (Wash.Rev.Stat., 1941 Supp., 9998-
114c) authorizes appellee Commissioner to issue an order and notice of assessment of delinquent
contributions upon prescribed personal service of the notice upon the employer if found within the
state, or, if not so found, by mailing the notice to the employer by registered mail at his last known
address. That section also authorizes the Commissioner to collect the assessment by distraint if it is
not paid within ten days after service of the notice. By 14e and 6b, the order of assessment may
be administratively reviewed by an appeal tribunal within the office of unemployment upon petition
of the employer, and this determination is, by 6i, made subject to judicial review on questions of
law by the state Superior Court, with further right of appeal in the state Supreme Court, as in other
civil cases.

In this case, notice of assessment for the years in question was personally served upon a sales
solicitor employed by appellant in the State of Washington, and a copy of the notice was mailed by
registered mail to appellant at its address in St. Louis, Missouri. Appellant appeared specially before
the office of unemployment, and moved to set aside the order and notice of assessment on the
ground that the service upon appellant's salesman was not proper service upon appellant; that
appellant was not a corporation of the State of Washington, and was not doing business within the
state; that it had no agent within the state upon whom service could be made; and that appellant is
not an employer, and does not furnish employment within the meaning of the statute.

The motion was heard on evidence and a stipulation of facts by the appeal tribunal, which denied
the motion

Page 326 U. S. 313

and ruled that appellee Commissioner was entitled to recover the unpaid contributions. That action
was affirmed by the Commissioner; both the Superior Court and the Supreme Court affirmed. 22
Wash.2d 146, 154 P.2d 801. Appellant in each of these courts assailed the statute as applied, as a
violation of the due process clause of the Fourteenth Amendment, and as imposing a
constitutionally prohibited burden on interstate commerce. The cause comes here on appeal under
237(a) of the Judicial Code, 28 U.S.C. 344(a), appellant assigning as error that the challenged
statutes, as applied, infringe the due process clause of the Fourteenth Amendment and the
commerce clause.

The facts, as found by the appeal tribunal and accepted by the state Superior Court and Supreme
Court, are not in dispute. Appellant is a Delaware corporation, having its principal place of business
in St. Louis, Missouri, and is engaged in the manufacture and sale of shoes and other footwear. It
maintains places of business in several states other than Washington, at which its manufacturing is
carried on and from which its merchandise is distributed interstate through several sales units or
branches located outside the State of Washington.

Appellant has no office in Washington, and makes no contracts either for sale or purchase of
merchandise there. It maintains no stock of merchandise in that state, and makes there no
deliveries of goods in intrastate commerce. During the years from 1937 to 1940, now in question,
appellant employed eleven to thirteen salesmen under direct supervision and control of sales
managers located in St. Louis. These salesmen resided in Washington; their principal activities were
confined to that state, and they were compensated by commissions based upon the amount of
their sales. The commissions for each year totaled more than $31,000. Appellant supplies its
salesmen with a line of samples, each consisting of one shoe of a pair, which

Page 326 U. S. 314

they display to prospective purchasers. On occasion, they rent permanent sample rooms, for
exhibiting samples, in business buildings, or rent rooms in hotels or business buildings temporarily
for that purpose. The cost of such rentals is reimbursed by appellant.

The authority of the salesmen is limited to exhibiting their samples and soliciting orders from
prospective buyers, at prices and on terms fixed by appellant. The salesmen transmit the orders to
appellant's office in St. Louis for acceptance or rejection, and, when accepted, the merchandise for
filling the orders is shipped f.o.b. from points outside Washington to the purchasers within the state.
All the merchandise shipped into Washington is invoiced at the place of shipment, from which
collections are made. No salesman has authority to enter into contracts or to make collections.

The Supreme Court of Washington was of opinion that the regular and systematic solicitation of
orders in the state by appellant's salesmen, resulting in a continuous flow of appellant's product
into the state, was sufficient to constitute doing business in the state so as to make appellant
amenable to suit in its courts. But it was also of opinion that there were sufficient additional
activities shown to bring the case within the rule, frequently stated, that solicitation within a state
by the agents of a foreign corporation plus some additional activities there are sufficient to render
the corporation amenable to suit brought in the courts of the state to enforce an obligation arising
out of its activities there. International Harvester Co. v. Kentucky, 234 U. S. 579, 234 U. S.
587; People's Tobacco Co. v. American Tobacco Co., 246 U. S. 79, 246 U. S. 87; Frene v. Louisville
Cement Co., 77 U.S.App.D.C. 129, 134 F.2d 511, 516. The court found such additional activities in
the salesmen's display of samples sometimes in permanent display rooms, and the salesmen's
residence within the state, continued over a period of years, all resulting in a

Page 326 U. S. 315

substantial volume of merchandise regularly shipped by appellant to purchasers within the state.
The court also held that the statute, as applied, did not invade the constitutional power of Congress
to regulate interstate commerce, and did not impose a prohibited burden on such commerce.

Appellant's argument, renewed here, that the statute imposes an unconstitutional burden on
interstate commerce need not detain us. For 53 Stat. 1391, 26 U.S.C. 1606(a) provides that

"No person required under a State law to make payments to an unemployment fund shall be
relieved from compliance therewith on the ground that he is engaged in interstate or foreign
commerce, or that the State law does not distinguish between employees engaged in interstate or
foreign commerce and those engaged in intrastate commerce."

It is no longer debatable that Congress, in the exercise of the commerce power, may authorize the
states, in specified ways, to regulate interstate commerce or impose burdens upon it. Kentucky
Whip & Collar Co. v. Illinois Central R. Co., 299 U. S. 334; Perkins v. Pennsylvania, 314 U.S.
586; Standard Dredging Corp. v. Murphy, 319 U. S. 306, 319 U. S. 308; Hooven & Allison Co. v.
Evatt, 324 U. S. 652, 324 U. S. 679; Southern Pacific Co. v. Arizona, 325 U. S. 761, 325 U. S. 769.

Appellant also insists that its activities within the state were not sufficient to manifest its
"presence" there, and that, in its absence, the state courts were without jurisdiction, that,
consequently, it was a denial of due process for the state to subject appellant to suit. It refers to
those cases in which it was said that the mere solicitation of orders for the purchase of goods
within a state, to be accepted without the state and filled by shipment of the purchased goods
interstate, does not render the corporation seller amenable to suit within the state. See Green v.
Chicago, B. & Q. R. Co., 205 U. S. 530, 205 U. S. 533; International Harvester Co. v. Kentucky,
supra, 234 U. S. 586-587; Philadelphia
Page 326 U. S. 316

& Reading R. Co. v. McKibbin, 243 U. S. 264, 243 U. S. 268; People's Tobacco Co. v. American
Tobacco Co., supra, 246 U. S. 87. And appellant further argues that, since it was not present within
the state, it is a denial of due process to subject it to taxation or other money exaction. It thus
denies the power of the state to lay the tax or to subject appellant to a suit for its collection.

Historically, the jurisdiction of courts to render judgment in personam is grounded on their de

facto power over the defendant's person. Hence, his presence within the territorial jurisdiction of a
court was prerequisite to its rendition of a judgment personally binding him. Pennoyer v. Neff, 95 U.
S. 714, 95 U. S. 733. But now that the capias ad respondendum has given way to personal service
of summons or other form of notice, due process requires only that, in order to subject a defendant
to a judgment in personam, if he be not present within the territory of the forum, he have certain
minimum contacts with it such that the maintenance of the suit does not offend "traditional notions
of fair play and substantial justice." Milliken v. Meyer, 311 U. S. 457, 311 U. S. 463. See Holmes, J.,
in McDonald v. Mabee, 243 U. S. 90, 243 U. S. 91.Compare Hoopeston Canning Co. v. Cullen, 318 U.
S. 313, 318 U. S. 316, 318 U. S. 319. See Blackmer v. United States, 284 U. S. 421; Hess v.
Pawloski, 274 U. S. 352; Young v. Masci, 289 U. S. 253. ,

Since the corporate personality is a fiction, although a fiction intended to be acted upon as though
it were a fact, Klein v. Board of Supervisors, 282 U. S. 19, 282 U. S. 24, it is clear that, unlike an
individual, its "presence" without, as well as within, the state of its origin can be manifested only by
activities carried on in its behalf by those who are authorized to act for it. To say that the
corporation is so far "present" there as to satisfy due process requirements, for purposes of
taxation or the maintenance of suits against it in the courts of the state, is to beg the question to
be decided. For the terms "present" or "presence" are

Page 326 U. S. 317

used merely to symbolize those activities of the corporation's agent within the state which courts
will deem to be sufficient to satisfy the demands of due process. L. Hand, J., in Hutchinson v. Chase
& Gilbert, 45 F.2d 139, 141. Those demands may be met by such contacts of the corporation with
the state of the forum as make it reasonable, in the context of our federal system of government,
to require the corporation to defend the particular suit which is brought there. An "estimate of the
inconveniences" which would result to the corporation from a trial away from its "home" or
principal place of business is relevant in this connection. Hutchinson v. Chase & Gilbert, supra, 141.

"Presence" in the state in this sense has never been doubted when the activities of the corporation
there have not only been continuous and systematic, but also give rise to the liabilities sued on,
even though no consent to be sued or authorization to an agent to accept service of process has
been given. St. Clair v. Cox, 106 U. S. 350, 106 U. S. 355; Connecticut Mutual Co. v. Spratley, 172 U.
S. 602, 172 U. S. 610-611; Pennsylvania Lumbermen's Ins. Co. v. Meyer, 197 U. S. 407, 197 U. S.
414-415; Commercial Mutual Co. v. Davis, 213 U. S. 245, 213 U. S. 255-256; International Harvester
Co. v. Kentucky, supra; cf. St. Louis S.W. R. Co. v. Alexander, 227 U. S. 218. Conversely, it has been
generally recognized that the casual presence of the corporate agent, or even his conduct of single
or isolated items of activities in a state in the corporation's behalf, are not enough to subject it to
suit on causes of action unconnected with the activities there. St. Clair v. Cox, supra, 106 U. S.
359, 106 U. S. 360; Old Wayne Life Assn. v. McDonough, 204 U. S. 8, 204 U. S. 21; Frene v.
Louisville Cement Co., supra, 515, and cases cited. To require the corporation in such
circumstances to defend the suit away from its home or other jurisdiction where it carries on more
substantial activities has been thought to lay too great and unreasonable a burden on the
corporation to comport with due process.

Page 326 U. S. 318

While it has been held, in cases on which appellant relies, that continuous activity of some sorts
within a state is not enough to support the demand that the corporation be amenable to suits
unrelated to that activity, Old Wayne Life Assn. v. McDonough, supra; Green v. Chicago, B. & Q. R.
Co., supra; Simon v. Southern R. Co., 236 U. S. 115; People's Tobacco Co. v. American Tobacco Co.,
supra; cf. Davis v. Farmers Co-operative Co., 262 U. S. 312, 262 U. S. 317, there have been
instances in which the continuous corporate operations within a state were thought so substantial
and of such a nature as to justify suit against it on causes of action arising from dealings entirely
distinct from those activities. See Missouri, K. & T. R. Co. v. Reynolds, 255 U.S. 565; Tauza v.
Susquehanna Coal Co., 220 N.Y. 259, 115 N.E. 915; cf. St. Louis S.W. R. Co. v. Alexander, supra.

Finally, although the commission of some single or occasional acts of the corporate agent in a state
sufficient to impose an obligation or liability on the corporation has not been thought to confer
upon the state authority to enforce it, Rosenberg Bros. & Co. v. Curtis Brown Co., 260 U. S. 516,
other such acts, because of their nature and quality and the circumstances of their commission,
may be deemed sufficient to render the corporation liable to suit. Cf. Kane v. New Jersey, 242 U. S.
160; Hess v. Pawloski, supra; Young v. Masci, supra. True, some of the decisions holding the
corporation amenable to suit have been supported by resort to the legal fiction that it has given its
consent to service and suit, consent being implied from its presence in the state through the acts of
its authorized agents. Lafayette Insurance Co. v. French, 18 How. 404, 59 U. S. 407; St. Clair v. Cox,
supra, 106 U. S. 356; Commercial Mutual Co. v. Davis, supra, 213 U. S. 254; Washington v. Superior
Court, 289 U. S. 361, 289 U. S. 364-365. But, more realistically, it may be said that those
authorized acts were of such a nature as to justify the fiction. Smolik v. Philadelphia &

Page 326 U. S. 319

Reading Co., 222 F. 148, 151. Henderson, The Position of Foreign Corporations in American
Constitutional Law, 94-95.

It is evident that the criteria by which we mark the boundary line between those activities which
justify the subjection of a corporation to suit and those which do not cannot be simply mechanical
or quantitative. The test is not merely, as has sometimes been suggested, whether the activity,
which the corporation has seen fit to procure through its agents in another state, is a little more or
a little less. St. Louis S.W. R. Co. v. Alexander, supra, 227 U. S. 228; International Harvester Co. v.
Kentucky, supra, 234 U. S. 587. Whether due process is satisfied must depend, rather, upon the
quality and nature of the activity in relation to the fair and orderly administration of the laws which
it was the purpose of the due process clause to insure. That clause does not contemplate that a
state may make binding a judgment in personam against an individual or corporate defendant with
which the state has no contacts, ties, or relations. Cf. Pennoyer v. Neff, supra; Minnesota
Commercial Assn. v. Benn, 261 U. S. 140.

But, to the extent that a corporation exercises the privilege of conducting activities within a state, it
enjoys the benefits and protection of the laws of that state. The exercise of that privilege may give
rise to obligations, and, so far as those obligations arise out of or are connected with the activities
within the state, a procedure which requires the corporation to respond to a suit brought to enforce
them can, in most instances, hardly be said to be undue. Compare International Harvester Co. v.
Kentucky, supra, with Green v. Chicago, B. & Q. R. Co., supra, and People's Tobacco Co. v. American
Tobacco Co., supra. Compare Connecticut Mutual Co. v. Spratley, supra, 172 U. S. 619, 172 U. S.
620, and Commercial Mutual Co. v. Davis, supra, with Old Wayne Life Assn. v. McDonough,
supra. See 29 Columbia Law Review, 187-195.

Page 326 U. S. 320

Applying these standards, the activities carried on in behalf of appellant in the State of Washington
were neither irregular nor casual. They were systematic and continuous throughout the years in
question. They resulted in a large volume of interstate business, in the course of which appellant
received the benefits and protection of the laws of the state, including the right to resort to the
courts for the enforcement of its rights. The obligation which is here sued upon arose out of those
very activities. It is evident that these operations establish sufficient contacts or ties with the state
of the forum to make it reasonable and just, according to our traditional conception of fair play and
substantial justice, to permit the state to enforce the obligations which appellant has incurred
there. Hence, we cannot say that the maintenance of the present suit in the State of Washington
involves an unreasonable or undue procedure.

We are likewise unable to conclude that the service of the process within the state upon an agent
whose activities establish appellant's "presence" there was not sufficient notice of the suit, or that
the suit was so unrelated to those activities as to make the agent an inappropriate vehicle for
communicating the notice. It is enough that appellant has established such contacts with the state
that the particular form of substituted service adopted there gives reasonable assurance that the
notice will be actual. Connecticut Mutual Co. v. Spratley, supra, 172 U. S. 618, 172 U. S. 619; Board
of Trade v. Hammond Elevator Co., 198 U. S. 424, 198 U. S. 437-438; Commercial Mutual Co. v.
Davis, supra, 213 U. S. 254-255. Cf. Riverside Mills v. Menefee, 237 U. S. 189, 237 U. S. 194, 237 U.
S. 195; See Knowles v. Gaslight & Coke Co., 19 Wall. 58, 86 U. S. 61; McDonald v. Mabee, supra;
Milliken v. Meyer, supra. Nor can we say that the mailing of the notice of suit to appellant by
registered mail at its home office was not reasonably calculated to apprise appellant of the
suit. Compare Hess v. Pawloski, supra, with McDonald v. Mabee, supra,

Page 326 U. S. 321

243 U. S. 92, and Wuchter v. Pizzutti, 276 U. S. 13, 276 U. S. 19, 276 U. S. 24; cf. Becquet v.
MacCarthy, 2 B. & Ad. 951; Maubourquet v. Wyse, 1 Ir.Rep.C.L. 471. See Washington v. Superior
Court, supra, 289 U. S. 365.

Only a word need be said of appellant's liability for the demanded contributions to the state
unemployment fund. The Supreme Court of Washington, construing and applying the statute, has
held that it imposes a tax on the privilege of employing appellant's salesmen within the state
measured by a percentage of the wages, here, the commissions payable to the salesmen. This
construction we accept for purposes of determining the constitutional validity of the statute. The
right to employ labor has been deemed an appropriate subject of taxation in this country and
England, both before and since the adoption of the Constitution. Steward Machine Co. v. Davis, 301
U. S. 548, 301 U. S. 579, et seq. And such a tax imposed upon the employer for unemployment
benefits is within the constitutional power of the states. Carmichael v. Southern Coal Co., 301 U. S.
495, 301 U. S. 508, et seq.

Appellant having rendered itself amenable to suit upon obligations arising out of the activities of its
salesmen in Washington, the state may maintain the present suit in personam to collect the tax
laid upon the exercise of the privilege of employing appellant's salesmen within the state. For
Washington has made one of those activities which, taken together, establish appellant's
"presence" there for purposes of suit the taxable event by which the state brings appellant within
the reach of its taxing power. The state thus has constitutional power to lay the tax and to subject
appellant to a suit to recover it. The activities which establish its "presence" subject it alike to
taxation by the state and to suit to recover the tax. Equitable Life Society v. Pennsylvania, 238 U. S.
143, 238 U. S. 146; cf. International Harvester Co. v. Department of Taxation, 322 U. S. 435, 322 U.
S. 442, et seq.; Hoopeston Canning Co. v. Cullen,

Page 326 U. S. 322

supra, 318 U. S. 316-319; see General Trading Co. v. Tax Comm'n, 322 U. S. 335.

Affirmed.

MR. JUSTICE JACKSON took no part in the consideration or decision of this case.

MR. JUSTICE BLACK delivered the following opinion.

Congress, pursuant to its constitutional power to regulate commerce, has expressly provided that a
State shall not be prohibited from levying the kind of unemployment compensation tax here
challenged. 26 U.S.C. 1600. We have twice decided that this Congressional consent is an adequate
answer to a claim that imposition of the tax violates the Commerce Clause. Perkins v.
Pennsylvania, 314 U.S. 586, affirming 342 Pa. 529; Standard Dredging Corp. v. Murphy, 319 U. S.
306, 319 U. S. 308. Two determinations by this Court of an issue so palpably without merit are
sufficient. Consequently, that part of this appeal which again seeks to raise the question seems so
patently frivolous as to make the case a fit candidate for dismissal. Fay v. Crozer, 217 U. S. 455. Nor
is the further ground advanced on this appeal, that the State of Washington has denied appellant
due process of law, any less devoid of substance. It is my view, therefore, that we should dismiss
the appeal as unsubstantial, [Footnote 1] Seaboard Air Line R. Co. v. Watson, 287 U. S. 86, 287 U.
S. 90, 287 U. S. 92, and decline the invitation to formulate broad rules as to the meaning of due
process, which here would amount to deciding a constitutional question "in advance of the
necessity for its decision." Federation of Labor v. McAdory, 325 U. S. 450, 325 U. S. 461.

Page 326 U. S. 323

Certainly appellant cannot, in the light of our past decisions, meritoriously claim that notice by
registered mail and by personal service on its sales solicitors in Washington did not meet the
requirements of procedural due process. And the due process clause is not brought in issue any
more by appellant's further conceptualistic contention that Washington could not levy a tax or
bring suit against the corporation because it did not honor that State with its mystical "presence."
For it is unthinkable that the vague due process clause was ever intended to prohibit a State from
regulating or taxing a business carried on within its boundaries simply because this is done by
agents of a corporation organized and having its headquarters elsewhere. To read this into the due
process clause would, in fact, result in depriving a State's citizens of due process by taking from the
State the power to protect them in their business dealings within its boundaries with
representatives of a foreign corporation. Nothing could be more irrational, or more designed to
defeat the function of our federative system of government. Certainly a State, at the very least, has
power to tax and sue those dealing with its citizens within its boundaries, as we have held
before. Hoopeston Canning Co. v. Cullen, 318 U. S. 313. Were the Court to follow this principle, it
would provide a workable standard for cases where, as here, no other questions are involved. The
Court has not chosen to do so, but instead has engaged in an unnecessary discussion, in the course
of which it has announced vague Constitutional criteria applied for the first time to the issue before
us. It has thus introduced uncertain elements confusing the simple pattern and tending to curtail
the exercise of State powers to an extent not justified by the Constitution.

The criteria adopted, insofar as they can be identified, read as follows: Due Process does permit
State courts to "enforce the obligations which appellant has incurred" if

Page 326 U. S. 324

it be found "reasonable and just according to our traditional conception of fair play and substantial
justice." And this, in turn, means that we will "permit" the State to act if, upon

"an 'estimate of the inconveniences' which would result to the corporation from a trial away from
its 'home' or principal place of business,"

we conclude that it is "reasonable" to subject it to suit in a State where it is doing business.

It is true that this Court did use the terms "fair play" and "substantial justice" in explaining the
philosophy underlying the holding that it could not be "due process of law" to render a personal
judgment against a defendant without notice and an opportunity to be heard. Milliken v. Meyer, 311
U. S. 457. In McDonald v. Mabee, 243 U. S. 90, 243 U. S. 91, cited in the Milliken, case, Mr. Justice
Holmes, speaking for the Court, warned against judicial curtailment of this opportunity to be heard,
and referred to such a curtailment as a denial of "fair play," which even the common law would
have deemed "contrary to natural justice." And previous cases had indicated that the ancient rule
against judgments without notice had stemmed from "natural justice" concepts. These cases, while
giving additional reasons why notice under particular circumstances is inadequate, did not mean
thereby that all legislative enactments which this Court might deem to be contrary to natural
justice ought to be held invalid under the due process clause. None of the cases purport to support
or could support a holding that a State can tax and sue corporations only if its action comports with
this Court's notions of "natural justice." I should have thought the Tenth Amendment settled that.

I believe that the Federal Constitution leaves to each State, without any "ifs" or "buts," a power to
tax and to open the doors of its courts for its citizens to sue corporations whose agents do business
in those States. Believing that the Constitution gave the States that power, I think it a judicial
deprivation to condition its exercise upon this

Page 326 U. S. 325

Court's notion of "fair play," however appealing that term may be. Nor can I stretch the meaning of
due process so far as to authorize this Court to deprive a State of the right to afford judicial
protection to its citizens on the ground that it would be more "convenient" for the corporation to be
sued somewhere else.

There is a strong emotional appeal in the words "fair play," "justice," and "reasonableness." But
they were not chosen by those who wrote the original Constitution or the Fourteenth Amendment
as a measuring rod for this Court to use in invalidating State or Federal laws passed by elected
legislative representatives. No one, not even those who most feared a democratic government,
ever formally proposed that courts should be given power to invalidate legislation under any such
elastic standards. Express prohibitions against certain types of legislation are found in the
Constitution, and, under the long-settled practice, courts invalidate laws found to conflict with
them. This requires interpretation, and interpretation, it is true, may result in extension of the
Constitution's purpose. But that is no reason for reading the due process clause so as to restrict a
State's power to tax and sue those whose activities affect persons and businesses within the State,
provided proper service can be had. Superimposing the natural justice concept on the
Constitution's specific prohibitions could operate as a drastic abridgment of democratic safeguards
they embody, such as freedom of speech, press and religion, [Footnote 2] and the right to counsel.
This

Page 326 U. S. 326

has already happened. Betts v. Brady, 316 U. S. 455. Compare Feldman v. United States, 322 U. S.
487, 322 U. S. 494-503. For application of this natural law concept, whether under the terms
"reasonableness," "justice," or "fair play," makes judges the supreme arbiters of the country's laws
and practices. Polk Co. v. Glover, 305 U. S. 5, 305 U. S. 17-18; Federal Power Commission v. Natural
Gas Pipeline Co., 315 U. S. 575, 315 U. S. 600, n. 4. This result, I believe, alters the form of
government our Constitution provides. I cannot agree.

True, the State's power is here upheld. But the rule announced means that tomorrow's judgment
may strike down a State or Federal enactment on the ground that it does not conform to this
Court's idea of natural justice. I therefore find myself moved by the same fears that caused Mr.
Justice Holmes to say in 1930:

"I have not yet adequately expressed the more than anxiety that I feel at the ever-increasing scope
given to the Fourteenth Amendment in cutting down what I believe to be the constitutional rights of
the States. As the decisions now stand, I see hardly any limit but the sky to the invalidating of
those rights if they happen to strike a majority of this Court as for any reason undesirable."

Baldwin v. Missouri, 281 U. S. 586, 281 U. S. 595.

[Footnote 1]

This Court has, on several occasions, pointed out the undesirable consequences of a failure to
dismiss frivolous appeals.Salinger v. United States, 272 U. S. 542, 272 U. S. 544; United Surety Co.
v. American Fruit Product Co., 238 U. S. 140; De Bearn v. Safe Deposit & Trust Co., 233 U. S.
24, 233 U. S. 33-34.

[Footnote 2]

These First Amendment liberties -- freedom of speech, press and religion -- provide a graphic
illustration of the potential restrictive capacity of a rule under which they are protected at a
particular time only because the Court, as then constituted, believes them to be a requirement of
fundamental justice. Consequently, under the same rule, another Court, with a different belief as to
fundamental justice, could, at least as against State action, completely or partially withdraw
Constitutional protection from these basic freedoms, just as though the First Amendment had never
been written.

Syllabus

Activities within a State of salesmen in the employ of a foreign corporation, exhibiting samples of
merchandise and soliciting orders from prospective buyers to be accepted or rejected by the
corporation at a point outside the State, were systematic and continuous, and resulted in a large
volume of interstate business. A statute of the State requires employers to pay into the state
unemployment compensation fund a specified percentage of the wages paid for the services of
employees within the State.

Held:
1. In view of 26 U.S.C. 1606(a) , providing that no person shall be relieved from compliance with a
state law requiring payments to an unemployment fund on the ground that he is engaged in
interstate commerce, the fact that the corporation is engaged in interstate commerce does not
relieve it from liability for payments to the state unemployment compensation fund. P. 326 U. S.
315.

2. The activities in behalf of the corporation render it amenable to suit in courts of the State to
recover payments due to the state unemployment compensation fund. P. 326 U. S. 320.

(a) The activities in question established between the State and the corporation sufficient contacts
or ties to make it reasonable and just, and in conformity to the due process requirements of the
Fourteenth Amendment, for the State to enforce against the corporation an obligation arising out of
such activities. P. 326 U. S. 320.

(b) In such a suit to recover payments due to the unemployment compensation fund, service of
process upon one of the corporation's salesmen within the State, and notice sent by registered mail
to the corporation at its home office, satisfies the requirements of due process. P. 326 U. S. 320.

Page 326 U. S. 311

3. The tax imposed by the state unemployment compensation statute -- construed by the state
court, in its application to the corporation, as a tax on the privilege of employing salesmen within
the State -- does not violate the due process clause of the Fourteenth Amendment. P. 326 U. S. 321.

22 Wash.2d 146, 154 P.2d 801, affirmed.

APPEAL from a judgment upholding the constitutionality of a state unemployment compensation

statute as applied to the appellant corporation.

Brief Fact Summary. Suit brought within the State of Washington against International Shoe
Company (Appellant), a Delaware corporation. Appellant had a principal place of business in St.
Louis, Missouri and engaged in the manufacture and sale of shoes and other footwear. The suit
sought to recover unpaid contributions to the state unemployment compensation fund.

Synopsis of Rule of Law. In order to subject a defendant to a judgment in personam, if he is not

present within the territory of the forum, he must have certain minimum contacts with the forum
such that the maintenance of the suit does not offend traditional notions of fair play and substantial
justice.

Facts. Appellant did not maintain an office within the State of Washington. The corporation
employed between eleven and thirteen salespersons in the state, under the direct supervision and
control of managers located in St. Louis. The salespeople resided in Washington and their principal
activities were confined to that state. The salespeople received commissions from their sales with
Washington. Appellant filed a Motion to Set Aside the Order and Notice of Assessment of
Unemployment because service on Appellants salesman was not proper. It also contended that it
was not a corporation in Washington, it was not doing business in that state, and it had no agent in
that state to accept service, nor did it furnish employment within the meaning of the statute. The
motion was denied, and both the Superior Court and the Supreme Court of Washington affirmed the
decision.

Issue. Whether a foreign actor or corporation has, by its merely conducting business within a
forum state, availed itself to suit within that forum state?

Held. Yes. Solicitation within a state by the agents of a foreign corporation plus some additional
activities render a foreign corporation amenable to suit within the forum state to enforce an
obligation arising out of its activities within the forum state. In this case, Appellants activities
within Washington were systematic and continuous within the years in question. These activities
resulted in a large volume of business. Further, Appellant received the benefits and protections of
the laws of Washington. As a result, the suit against Appellant within the state does not involve an
unreasonable or undue procedure.

Discussion. In determining whether such minimum contacts exist, a court will look at two factors:
sufficient minimum contacts and notice. International Shoe requires that a defendant have such
minimum contacts with the forum state that exercise of jurisdiction over the defendant would be
fair and reasonable. Under this analysis, a court will look to whether both purposeful availment and
foreseeability exist. Under the foreseeability prong of the minimum contacts analysis, it must be
foreseeable that the defendants business within the forum makes it amenable to suit within that
forum. In addition, under the purposeful availment prong, the defendants minimum contacts with
the forum state must arise from non-accidental contact. In addition to the minimum contacts
analysis, due process also requires that a reasonable effort be used to notify the defendant of a
pending lawsuit so that it has an opportunity to appear and be heard.

PERKINS v. BENGUET CONSOLIDATED MINING CO. et al.

No. 85.
Argued: Nov. 27, 28, 1951.
Decided: March 3, 1952.

opinion, BURTON [HTML]

dissent, MINTON [HTML]

See 343 U.S. 917, 72 S.Ct. 645.

Mr. Robert N. Gorman, Cincinnati, Ohio, for petitioner.
Mr. Lucien H. Mercier, Washington, D.C., for respondent.
TOP
Mr. Justice BURTON delivered the opinion of the Court.
This case calls for an answer to the question whether the Due Process Clause of the Fourteenth
Amendment to the Constitution of the United States precludes Ohio from subjecting a foreign
corporation to the jurisdiction of its courts in this action in personam. The corporation has been
carrying on in Ohio a continuous and systematic, but limited, part of its general business. Its
president, while engaged in doing such business in Ohio, has been served with summons in this
proceeding. The cause of action sued upon did not arise in Ohio and does not relate to the
corporation's activities there. For the reasons hereafter stated, we hold that the Fourteenth
Amendment leaves Ohio free to take or decline jurisdiction over the corporation.
After extended litigation elsewhere 1 petitioner, Idonah Slade Perkins, a nonresident of Ohio, filed
two actions in personam in the Court of Common Pleas of Clermont County, Ohio, against the
several respondents. Among those sued is the Benguet Consolidated Mining Company, here called
the mining company. It is styled a 'sociedad anonima' under the laws of the Philippine Islands,
where it owns and has operated profitable gold and silver mines. In one action petitioner seeks
approximately $68,400 in dividends claimed to be due her as a stockholder. In the other she claims
$2,500,000 damages largely because of the company's failure to issue to her certificates for
120,000 shares of its stock.
In each case the trial court sustained a motion to quash the service of summons on the mining
company. Ohio Com.Pl., 99 N.E.2d 515. The Court of Appeals of Ohio affirmed that decision, 88 Ohio
App. 118, 95 N.E.2d 5, as did the Supreme Court of Ohio, 155 Ohio St. 116, 98 N.E.2d 33. The cases
were consolidated and we granted certiorari in order to pass upon the conclusion voiced within the
court below that federal due process required the result there reached. 342 U.S. 808, 72 S.Ct. 33,
96 L.Ed. -.
We start with the holding of the Supreme Court of Ohio, not contested here, that, under Ohio law,
the mining company is to be treated as a foreign corporation. 2 Actual notice of the proceeding was
given to the corporation in the instant case through regular service of summons upon its president
while he was in Ohio acting in that capacity. Accordingly, there can be no jurisdictional objection
based upon a lack of notice to a responsible representative of the corporation.
The answer to the question of whether the state courts of Ohio are open to a proceeding in
personam, against an amply notified foreign corporation, to enforce a cause of action not arising in
Ohio and not related to the business or activities of the corporation in that State rests entirely upon
the law of Ohio, unless the Due Process Clause of the Fourteenth Amendment compels a decision
either way.
The suggestion that federal due process compels the State to open its courts to such a case has no
substance.
'Provisions for making foreign corporations subject to service in the state is a matter of legislative
discretion, and a failure to provide for such service is not a denial of due process. Still less is it
incumbent upon a state in furnishing such process to make the jurisdiction over the foreign
corporation wide enough to include the adjudication of transitory actions not arising in the state.'
Missouri P.R. Co. v. Clarendon Co., 257 U.S. 533, 535, 42 S.Ct. 210, 211, 66 L.Ed. 354.
Also without merit is the argument that merely because Ohio permits a complainant to maintain a
proceeding in personam in its courts against a properly served nonresident natural person to
enforce a cause of action which does not arise out of anything done in Ohio, therefore, the
Constitution of the United States compels Ohio to provide like relief against a foreign corporation.
A more serious question is presented by the claim that the Due Process Clause of the Fourteenth
Amendment prohibits Ohio from granting such relief against a foreign corporation. The syllabus in
the report of the case below, while denying the relief sought, does not indicate whether the
Supreme Court of Ohio rested its decision on Ohio law or on the Fourteenth Amendment. The first
paragraph of that syllabus is as follows:
'1. The doing of business in this state by a foreign corporation, which has not appointed a statutory
agent upon whom service of process against the corporation can be made in this state or otherwise
consented to service of summons upon it in actions brought in this state, will not make the
corporation subject to service of summons in an action in personam brought in the courts of this
state to enforce a cause of action not arising in this state and in no way related to the business or
activities of the corporation in this state.' 155 Ohio St. 116, 117, 98 N.E.2d 33, 34.
If the above statement stood alone, it might mean that the decision rested solely upon the law of
Ohio. In support of that possibility we are told that, under the rules and practice of the Supreme
Court of Ohio, only the syllabus necessarily carries the approval of that court. 3 As we understand
the Ohio practice, the syllabus of its Supreme Court constitutes the official opinion of that court but
it must be read in the light of the facts and issues of the case.
The only opinion accompanying the syllabus of the court below places the concurrence of its author
unequivocally upon the ground that the Due Process Clause of the Fourteenth Amendment prohibits
the Ohio courts from exercising jurisdiction over the respondent corporation in this
proceeding. 4 That opinion is an official part of the report of the case. The report, however, does not
disclose to what extent, if any, the other members of the court may have shared the view
expressed in that opinion. Accordingly, for us to allow the judgment to stand as it is would risk an
affirmance of a decision which might have been decided differently if the court below had felt free,
under our decisions, to do so.
The cases primarily relied on by the author of the opinion accompanying the syllabus below are Old
Wayne Life Ass'n v. McDonough, 204 U.S. 8, 27 S.Ct. 236, 51 L.Ed. 345, and Simon v. Southern R.
Co.,236 U.S. 115, 35 S.Ct. 255, 59 L.Ed. 492. Unlike the case at bar, no actual notice of the
proceedings was received in those cases by a responsible representative of the foreign corporation.
In each case, the public official who was served with process in an attempt to bind the foreign
corporation was held to lack the necessary authority to accept service so as to bind it in a
proceeding to enforce a cause of action arising outside of the state of the forum. See 204 U.S. at
pages 2223, 27 S.Ct. at pages 240241, and 236 U.S. at page 130, 35 S.Ct. at page 260. The
necessary result was a finding of inadequate service in each case and a conclusion that the foreign
corporation was not bound by it. The same would be true today in a like proceeding where the only
service had and the only notice given was that directed to a public official who had no authority, by
statute or otherwise, to accept it in that kind of a proceeding. At the time of rendering the above
decisions this Court was aided, in reaching its conclusion as to the limited scope of the statutory
authority of the public officials, by this Court's conception that the Due Process Clause of the
Fourteenth Amendment precluded a state from giving its public officials authority to accept service
in terms broad enough to bind a foreign corporation in proceedings against it to enforce an
obligation arising outside of the state of the forum. That conception now has been modified by the
rationale adopted in later decisions and particularly in International Shoe Co. v. Washington, 326
U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95.
Today if an authorized representative of a foreign corporation be physically present in the state of
the forum and be there engaged in activities appropriate to accepting service or receiving notice on
its behalf, we recognize that there is no unfairness in subjecting that corporation to the jurisdiction
of the courts of that state through such service of process upon that representative. This has been
squarely held to be so in a proceeding in personam against such a corporation, at least in relation
to a cause of action arising out of the corporation's activities within the state of the forum. 5
The essence of the issue here, at the constitutional level, is a like one of general fairness to the
corporation. Appropriate tests for that are discussed in International Shoe Co. v. Washington, supra,
326 U.S. at pages 317320, 66 S.Ct. at pages 158, 160. The amount and kind of activities which
must be carried on by the foreign corporation in the state of the forum so as to make it reasonable
and just to subject the corporation to the jurisdiction of that state are to be determined in each
case. The corporate activities of a foreign corporation which, under state statute, make it necessary
for it to secure a license and to designate a statutory agent upon whom process may be served
provide a helpful but not a conclusive test. For example, the state of the forum may by statute
require a foreign mining corporation to secure a license in order lawfully to carry on there such
functional intrastate operations as those of mining or refining ore. On the other hand, if the same
corporation carries on, in that state, other continuous and systematic corporate activities as it did
hereconsisting of directors' meetings, business correspondence, banking, stock transfers,
payment of salaries, purchasing of machinery, etc.those activities are enough to make it fair and
reasonable to subject that corporation to proceedings in personam in that state, at least insofar as
the proceedings in personam seek to enforce causes of action relating to those very activities or to
other activities of the corporation within the state.
The instant case takes us one step further to a proceeding in personam to enforce a cause of action
not arising out of the corporation's activities in the state of the forum. Using the tests mentioned
above we find no requirement of federal due process that either prohibits Ohio from opening its
courts to the cause of action here presented or compels Ohio to do so. This conforms to the realistic
reasoning in International Shoe Co. v. Washington, supra, 326 U.S. at pages 318319, 66 S.Ct. at
pages 159160:
'* * * there have been instances in which the continuous corporate operations within a state were
thought so substantial and of such a nature as to justify suit against it on causes of action arising
from dealings entirely distinct from those activities. See Missouri, K. & T.R. Co. v. Reynolds, 255 U.S.
565, 41 S.Ct. 446, 65 L.Ed. 788; 6 Tauza v. Susquehanna Coal Co., 220 N.Y. 259, 115 N.E. 915; cf. St.
Louis S.W.R. Co. v. Alexander, supra (227 U.S. 218, 33 S.Ct. 245, 57 L.Ed. 486).
'* * * some of the decisions holding the corporation amenable to suit have been supported by
resort to the legal fiction that it has given its consent to service and suit, consent being implied
from its presence in the state through the acts of its authorized agents. Lafayette Insurance Co. v.
French, 18 How. 404, 407; St. Clair v. Cox, supra, 106 U.S. (350) 356, 1 S.Ct. (354) 359, 27 L.Ed.
222; Commercial Mutual Accident Co. v. Davis, supra, 213 U.S. (245) 254, 29 S.Ct. (445) 447, 53
L.Ed. 782; State of Washington v. Superior Court, 289 U.S. 361, 364, 365, 53 S.Ct. 624, 626, 627, 77
L.Ed. 1256. But more realistically it may be said that those authorized acts were of such a nature as
to justify the fiction. Smolik v. Philadelphia & Reading Co., D.C., 222 F. 148, 151. Henderson, The
Position of Foreign Corporations in American Constitutional Law, 94, 95.
'* * * Whether due process is satisfied must depend rather upon the quality and nature of the
activity in relation to the fair and orderly administration of the laws which it was the purpose of the
due process clause to insure. That clause does not contemplate that a state may make binding a
judgment in personam against an individual or corporate defendant with which the state has no
contacts, ties, or relations. Cf. Pennoyer v. Neff, supra (95 U.S. 714, 24 L.Ed. 565); Minnesota
Commercial Assn. v. Benn,261 U.S. 140, 43 S.Ct. 293, 67 L.Ed. 573.'
It remains only to consider, in more detail, the issue of whether, as a matter of federal due process,
the business done in Ohio by the respondent mining company was sufficiently substantial and of
such a nature as to permit Ohio to entertain a cause of action against a foreign corporation, where
the cause of action arose from activities entirely distinct from its activities in Ohio. See International
Shoe Co. v. Washington, supra, 326 U.S. at page 318, 66 S.Ct. at page 159.
The Ohio Court of Appeals summarized the evidence on the subject. 88 Ohio App. at pages 119
125, 95 N.E.2d at pages 69. From that summary the following facts are substantially beyond
controversy: The company's mining properties were in the Philippine Islands. Its operations there
were completely halted during the occupation of the Islands by the Japanese. During that interim
the president, who was also the general manager and principal stockholder of the company,
returned to his home in Clermont County, Ohio. There he maintained an office in which he
conducted his personal affairs and did many things on behalf of the company. He kept there office
files of the company. He carried on there correspondence relating to the business of the company
and to its employees. He drew and distributed there salary checks on behalf of the company, both
in his own favor as president and in favor of two company secretaries who worked there with him.
He used and maintained in Clermont County, Ohio, two active bank accounts carrying substantial
balances of company funds. A bank in Hamilton County, Ohio, acted as transfer agent for the stock
of the company. Several directors' meetings were held at his office or home in Clermont County.
From that office he supervised policies dealing with the rehabilitation of the corporation's properties
in the Philippines and he dispatched funds to cover purchases of machinery for such rehabilitation.
Thus he carried on in Ohio a continuous and systematic supervision of the necessarily limited
wartime activities of the company. He there discharged his duties as president and general
manager, both during the occupation of the company's properties by the Japanese and immediately
thereafter. While no mining properties in Ohio were owned or operated by the company, many of its
wartime activities were directed from Ohio and were being given the personal attention of its
president in that State at the time he was served with summons. Consideration of the
circumstances which, under the law of Ohio, ultimately will determine whether the courts of that
State will choose to take jurisdiction over the corporation is reserved for the courts of that State.
Without reaching that issue of state policy, we conclude that, under the circumstances above
recited, it would not violate federal due process for Ohio either to take or decline jurisdiction of the
corporation in this proceeding. This relieves the Ohio courts of the restriction relied upon in the
opinion accompanying the syllabus below and which may have influenced the judgment of the
court below.
Accordingly, the judgment of the Supreme Court of Ohio is vacated and the cause is remanded to
that court for further proceedings in the light of this opinion. 7
It is so ordered.
Judgment vacated and cause remanded for further proceedings.
Mr. Justice BLACK concurs in the result.
TOP

Mr. Justice MINTON, with whom the CHIEF JUSTICE joins, dissenting.
As I understand the practice in Ohio, the law as agreed to by the court is stated in the syllabus. If
an opinion is filed, it expresses the views of the writer of the opinion and of those who may join him
as to why the law was so declared in the syllabus. Judge Taft alone filed an opinion in the instant
case.
The law as declared in the syllabus, which is the whole court speaking, is clearly based upon
adequate state grounds. Judge Taft in his opinion expresses the view that the opinions of this Court
on due process grounds require the court to declare the law as stated in the syllabus. As the
majority opinion of this Court points out, this is an erroneous view of this Court's decisions. 'This
brings the situation clearly within the settled rule whereby this Court will not review a State court
decision resting on an adequate and independent nonfederal ground even though the State court
may have also summoned to its support an erroneous view of federal law.' Radio Station WOW v.
Johnson, 326 U.S. 120, 129, 65 S.Ct. 1475, 1480, 89 L.Ed. 2092.
The case of State Tax Comm'n v. Van Cott, 306 U.S. 511, 59 S.Ct. 605, 83 L.Ed. 950, is not this case.
There the case was not clearly decided on an adequate state ground, but the state ground and the
federal ground were so interwoven that this Court was 'unable to conclude that the judgment rests
upon an independent interpretation of the state law.' 306 U.S. at page 514, 59 S.Ct. at page 606. In
the instant case, a clear statement of the state law is made by the court in the syllabus. Only Judge
Taft has summoned the erroneous view of this Court's decisions to his support of the adequate
state ground approved by the whole court.
What we are saying to Ohio is: 'You have decided this case on an adequate state ground, denying
service, which you had a right to do, but you don't have to do it if you don't want to, as far as the
decisions of this Court are concerned.' I think what we are doing is giving gratuitously an advisory
opinion to the Ohio Supreme Court. I would dismiss the writ as improvidently granted.
CC | Transformed by Public.Resource.Org
1
See Perkins v. Perkins, 57 Phil.R. 205; Harden v. Benguet Consolidated Mining Co., 58 Phil.R. 141;
Perkins v. Guaranty Trust Co., 274 N.Y. 250, 8 N.E.2d 849; Perkins v. Beneguet Consolidated Mining
Co., 55 Cal.App.2d 720, 132 P.2d 70, rehearing denied, 55 Cal.App.2d 774, 132 P.2d 102, certiorari
denied, 319 U.S. 774, 63 S.Ct. 1435, 37 L.Ed. 1721; 60 Cal.App.2d 845, 141 P.2d 19, certiorari
denied, 320 U.S. 803, 815, 64 S.Ct. 429, 88 L.Ed. 485; Perkins v. First National Bank of Cincinnati,
Com.Pl., Hamilton County, Ohio, 79 N.E.2d 159.
2
Ohio requires a foreign corporation to secure a license to transact 'business' in that State,
Throckmorton's Ohio Code, 1940, 86254, and to appoint a 'designated agent' upon whom
process may be served, 86252, 86255. The mining company has neither secured such a
license nor designated such an agent. While this may make it subject to penalties and handicaps,
this does not prevent it from transacting business or being sued. 862525. If it has a 'managing
agent' in Ohio, service may be made upon him. 11290. Such service is a permissive alternative to
service on the corporation through its president or other chief officer. 11288. Lively v. Picton, 6
Cir., 218 F. 401, 406407. The evidence as to the business activities of the corporation in Ohio is
summarized by the Ohio Court of Appeals. 88 Ohio App. 118, 119125, 95 N.E.2d 5, 69. That
court held that such activities did not constitute the transaction of business referred to in the Code.
In its syllabus, however, the Supreme Court of Ohio, without passing upon the sufficiency of such
acts for the above statutory purpose, and without defining its use of the term, affirmed the
judgment dismissing the complaint and assumed that what the corporation had done in Ohio
constituted 'doing business' to an extent sufficient to be recognized in reaching its decision.
3
In 1858 the Supreme Court of Ohio promulgated the following rule:
'A syllabus of the points decided by the Court in each case, shall be stated, in writing, by the Judge
assigned to deliver the opinion of
the Court, which shall be confined to the points of law, arising from the facts of the case, that have
been determined by the Court. And the syllabus shall be submitted to the Judges concurring
therein, for revisal, before publication thereof; and it shall be inserted in the book of reports without
alteration, unless by the consent of the Judges concurring therein.' 5 Ohio St. vii.
This policy has been recognized by statute. Bates Ohio R.S. 427, as amended, 103 Ohio Laws
1913, 1483, and 108 Ohio Laws 1919, 1483. It appears now in Throckmorton's Ohio Code, 1940,
1483, as follows: 'Whenever it has been thus decided to report a case for publication the syllabus
thereof shall be prepared by the judge delivering the opinion, and approved by a majority of the
members of the court; and the report may be per curiam, or if an opinion be reported, the same
shall be written in as brief and concise form as may be consistent with a clear presentation of the
law of the case. * * * Only such cases as are hereafter reported in accordance with the provisions of
this section shall be recognized by and receive the official sanction of any court within the state.'
There are many references to this practice, both in the syllabi and opinions written for the Supreme
Court of Ohio. Typical of these is the following:
'It has long been the rule of this court that the syllabus contains the law of the case. It is the only
part of the opinion requiring the approval of all the members concurring in the judgment. Where
the judge writing an opinion discusses matters or gives expression to his views on questions not
contained in the syllabus, it is merely the personal opinion of that judge.' State ex rel. Donahey v.
Edmondson, 89 Ohio St. 93, 107108, 105 N.E. 269, 273, 52 L.R.A.,N.S., 305.
See also, Williamson Heater Co. v. Radich, 128 Ohio St. 124, 190 N.E. 403; Baltimore & O.R. Co. v.
Baillie, 112 Ohio St. 567, 148 N.E. 233. A syllabus must be read in the light of the facts in the case,
even where brought out in the accompanying opinion rather than in the syllabus itself. See
Williamson Heater Co. v. Radich, supra; Perkins v. Bright, 109 Ohio St. 14, 1920, 141 N.E. 689,
690691; In re Poage, 87 Ohio St. 72, 8283, 100 N.E. 125, 127128.
4
'However, the doing of business in a state by a foreign corporation, which has not appointed a
statutory agent upon whom service of process against the corporation can be made in that state or
otherwise consented to service of summons upon it in actions brought in that state, will not make
the corporation subject to service of summons in an action in personam brought in the courts of
that state to enforce a cause of action in no way related to the business or activities of the
corporation in that state. Old Wayne Mutual Life Ass'n of Indianapolis v. McDonough, 204 U.S. 8, 22,
23, 27 S.Ct. 236, 51 L.Ed. 345; Simon v. Southern Ry. Co., 236 U.S. 115, 129, 130 and 132, 35 S.Ct.
255, 59 L.Ed. 492. See, also, Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining & Milling
Co., 243 U.S. 93, 95 and 96, 37 S.Ct. 344, 61 L.Ed. 610; Robert Mitchell Furniture Co. v. Selden
Breck Construction Co., 257 U.S. 213, 215 and 216, 42 S.Ct. 84, 66 L.Ed. 201; International Shoe
Co. v. Washington, 326 U.S. 310, 319 and 320, 66 S.Ct. 154, 90 L.Ed. 95.
'An examination of the opinions of the Supreme Court of the United States in the foregoing cases
will clearly disclose that service of summons in such an instance would be void as wanting in due
process of law.' 155 Ohio St. 116, 119120, 98 N.E.2d 33, 35.
5
'* * * The obligation which is here sued upon arose out of those very activities. It is evident that
these operations establish sufficient contacts or ties with the state of the forum to make it
reasonable and just according to our traditional conception of fair play and substantial justice to
permit the state to enforce the obligations which appellant has incurred there. Hence we cannot
say that the maintenance of the present suit in the State of Washington involves an unreasonable
or undue procedure.' International Shoe Co. v. Washington, supra, 326 U.S. at page 320, 66 S.Ct. at
page 160.
6
This citation does not disclose the significance of this decision but light is thrown upon it by the
opinions of the state court below. Reynolds v. Missouri, K. & T.R. Co., 224 Mass. 379, 113 N.E. 413;
228 Mass. 584, 117 N.E. 913. In addition to the cases cited in the text see Barrow S.S. Co. v.
Kane, 170 U.S. 100, 18 S.Ct. 526, 42 L.Ed. 964; Pennsylvania Fire Insurance Co. v. Gold Issue Mining
Co., 243 U.S. 93, 37 S.Ct. 344, 61 L.Ed. 610 (statutory agent appointed); Philadelphia & Reading R.
Co. v. McKibbin, 243 U.S. 264, 268269, 37 S.Ct. 280, 281, 282, 61 L.Ed. 710 (question left open).
7
For like procedure followed under somewhat comparable circumstances see State Tax Comm'n v.
Van Cott, 306 U.S. 511, 59 S.Ct. 605, 83 L.Ed. 950.
SECOND DIVISION

[G.R. No. 103493. June 19, 1997]

PHILSEC INVESTMENT CORPORATION, BPI-INTERNATIONAL FINANCE LIMITED, and

ATHONA HOLDINGS, N.V., petitioners, vs. THE HONORABLE COURT OF APPEALS, 1488,
INC., DRAGO DAIC, VENTURA O. DUCAT, PRECIOSO R. PERLAS, and WILLIAM H.
CRAIG, respondents.

DECISION
MENDOZA, J.:

This case presents for determination the conclusiveness of a foreign judgment upon the rights of
the parties under the same cause of action asserted in a case in our local court.Petitioners brought
this case in the Regional Trial Court of Makati, Branch 56, which, in view of the pendency at the
time of the foreign action, dismissed Civil Case No. 16563 on the ground of litis pendentia, in
addition to forum non conveniens. On appeal, the Court of Appeals affirmed. Hence this petition for
review on certiorari.
The facts are as follows:
On January 15, 1983, private respondent Ventura O. Ducat obtained separate loans from petitioners
Ayala International Finance Limited (hereafter called AYALA) [1] and Philsec Investment Corporation
(hereafter called PHILSEC) in the sum of US$2,500,000.00, secured by shares of stock owned by
Ducat with a market value of P14,088,995.00. In order to facilitate the payment of the loans,
private respondent 1488, Inc., through its president, private respondent Drago Daic, assumed
Ducats obligation under an Agreement, dated January 27, 1983, whereby 1488, Inc. executed a
Warranty Deed with Vendors Lien by which it sold to petitioner Athona Holdings, N.V. (hereafter
called ATHONA) a parcel of land in Harris County, Texas, U.S.A., for US$2,807,209.02, while PHILSEC
and AYALA extended a loan to ATHONA in the amount of US$2,500,000.00 as initial payment of the
purchase price. The balance of US$307,209.02 was to be paid by means of a promissory note
executed by ATHONA in favor of 1488, Inc. Subsequently, upon their receipt of the
US$2,500,000.00 from 1488, Inc., PHILSEC and AYALA released Ducat from his indebtedness and
delivered to 1488, Inc. all the shares of stock in their possession belonging to Ducat.
As ATHONA failed to pay the interest on the balance of US$307,209.02, the entire amount covered
by the note became due and demandable. Accordingly, on October 17, 1985, private respondent
1488, Inc. sued petitioners PHILSEC, AYALA, and ATHONA in the United States for payment of the
balance of US$307,209.02 and for damages for breach of contract and for fraud allegedly
perpetrated by petitioners in misrepresenting the marketability of the shares of stock delivered to
1488, Inc. under the Agreement. Originally instituted in the United States District Court of Texas,
165th Judicial District, where it was docketed as Case No. 85-57746, the venue of the action was
later transferred to the United States District Court for the Southern District of Texas, where 1488,
Inc. filed an amended complaint, reiterating its allegations in the original complaint. ATHONA filed
an answer with counterclaim, impleading private respondents herein as counterdefendants, for
allegedly conspiring in selling the property at a price over its market value. Private respondent
Perlas, who had allegedly appraised the property, was later dropped as counterdefendant. ATHONA
sought the recovery of damages and excess payment allegedly made to 1488, Inc. and, in the
alternative, the rescission of sale of the property. For their part, PHILSEC and AYALA filed a motion
to dismiss on the ground of lack of jurisdiction over their person, but, as their motion was denied,
they later filed a joint answer with counterclaim against private respondents and Edgardo V.
Guevarra, PHILSECs own former president, for the rescission of the sale on the ground that the
property had been overvalued. On March 13, 1990, the United States District Court for the
Southern District of Texas dismissed the counterclaim against Edgardo V. Guevarra on the ground
that it was frivolous and [was] brought against him simply to humiliate and embarrass him. For this
reason, the U.S. court imposed so-called Rule 11 sanctions on PHILSEC and AYALA and ordered
them to pay damages to Guevarra.
On April 10, 1987, while Civil Case No. H-86-440 was pending in the United States, petitioners filed
a complaint For Sum of Money with Damages and Writ of Preliminary Attachment against private
respondents in the Regional Trial Court of Makati, where it was docketed as Civil Case No. 16563.
The complaint reiterated the allegation of petitioners in their respective counterclaims in Civil
Action No. H-86-440 of the United States District Court of Southern Texas that private respondents
committed fraud by selling the property at a price 400 percent more than its true value of
US$800,000.00. Petitioners claimed that, as a result of private respondents fraudulent
misrepresentations, ATHONA, PHILSEC, and AYALA were induced to enter into the Agreement and to
purchase the Houston property. Petitioners prayed that private respondents be ordered to return to
ATHONA the excess payment of US$1,700,000.00 and to pay damages. On April 20, 1987, the trial
court issued a writ of preliminary attachment against the real and personal properties of private
respondents.[2]
Private respondent Ducat moved to dismiss Civil Case No. 16563 on the grounds of (1) litis
pendentia, vis-a-vis Civil Action No. H-86-440 filed by 1488, Inc. and Daic in the U.S., (2) forum non
conveniens, and (3) failure of petitioners PHILSEC and BPI-IFL to state a cause of action. Ducat
contended that the alleged overpricing of the property prejudiced only petitioner ATHONA, as
buyer, but not PHILSEC and BPI-IFL which were not parties to the sale and whose only participation
was to extend financial accommodation to ATHONA under a separate loan agreement. On the other
hand, private respondents 1488, Inc. and its president Daic filed a joint Special Appearance and
Qualified Motion to Dismiss, contending that the action being in personam, extraterritorial service
of summons by publication was ineffectual and did not vest the court with jurisdiction over 1488,
Inc., which is a non-resident foreign corporation, and Daic, who is a non-resident alien.
On January 26, 1988, the trial court granted Ducats motion to dismiss, stating that the evidentiary
requirements of the controversy may be more suitably tried before the forum of the litis
pendentia in the U.S., under the principle in private international law of forum non conveniens,
even as it noted that Ducat was not a party in the U.S. case.
A separate hearing was held with regard to 1488, Inc. and Daics motion to dismiss. On March 9,
1988, the trial court[3] granted the motion to dismiss filed by 1488, Inc. and Daic on the ground
of litis pendentia considering that

the main factual element of the cause of action in this case which is the validity of the sale of real
property in the United States between defendant 1488 and plaintiff ATHONA is the subject matter
of the pending case in the United States District Court which, under the doctrine of forum non
conveniens, is the better (if not exclusive) forum to litigate matters needed to determine the
assessment and/or fluctuations of the fair market value of real estate situated in Houston, Texas,
U.S.A. from the date of the transaction in 1983 up to the present and verily, . . . (emphasis by trial
court)

The trial court also held itself without jurisdiction over 1488, Inc. and Daic because they were non-
residents and the action was not an action in rem or quasi in rem, so that extraterritorial service of
summons was ineffective. The trial court subsequently lifted the writ of attachment it had earlier
issued against the shares of stocks of 1488, Inc. and Daic.
Petitioners appealed to the Court of Appeals, arguing that the trial court erred in applying the
principle of litis pendentia and forum non conveniens and in ruling that it had no jurisdiction over
the defendants, despite the previous attachment of shares of stocks belonging to 1488, Inc. and
Daic.
On January 6, 1992, the Court of Appeals [4] affirmed the dismissal of Civil Case No. 16563 against
Ducat, 1488, Inc., and Daic on the ground of litis pendentia, thus:

The plaintiffs in the U.S. court are 1488 Inc. and/or Drago Daic, while the defendants are Philsec,
the Ayala International Finance Ltd. (BPI-IFLs former name) and the Athona Holdings, NV. The case
at bar involves the same parties. The transaction sued upon by the parties, in both cases is the
Warranty Deed executed by and between Athona Holdings and 1488 Inc. In the U.S. case, breach of
contract and the promissory note are sued upon by 1488 Inc., which likewise alleges fraud
employed by herein appellants, on the marketability of Ducats securities given in exchange for the
Texas property. The recovery of a sum of money and damages, for fraud purportedly committed by
appellees, in overpricing the Texas land, constitute the action before the Philippine court, which
likewise stems from the same Warranty Deed.

The Court of Appeals also held that Civil Case No. 16563 was an action in personam for the
recovery of a sum of money for alleged tortious acts, so that service of summons by publication did
not vest the trial court with jurisdiction over 1488, Inc. and Drago Daic. The dismissal of Civil Case
No. 16563 on the ground of forum non conveniens was likewise affirmed by the Court of Appeals on
the ground that the case can be better tried and decided by the U.S. court:

The U.S. case and the case at bar arose from only one main transaction, and involve foreign
elements, to wit: 1) the property subject matter of the sale is situated in Texas, U.S.A.; 2) the seller,
1488 Inc. is a non-resident foreign corporation; 3) although the buyer, Athona Holdings, a foreign
corporation which does not claim to be doing business in the Philippines, is wholly owned by
Philsec, a domestic corporation, Athona Holdings is also owned by BPI-IFL, also a foreign
corporation; 4) the Warranty Deed was executed in Texas, U.S.A.

In their present appeal, petitioners contend that:

1. THE DOCTRINE OF PENDENCY OF ANOTHER ACTION BETWEEN THE SAME PARTIES FOR THE SAME
CAUSE (LITIS PENDENTIA) RELIED UPON BY THE COURT OF APPEALS IN AFFIRMING THE TRIAL
COURTS DISMISSAL OF THE CIVIL ACTION IS NOT APPLICABLE.
2. THE PRINCIPLE OF FORUM NON CONVENIENS ALSO RELIED UPON BY THE COURT OF APPEALS IN
AFFIRMING THE DISMISSAL BY THE TRIAL COURT OF THE CIVIL ACTION IS LIKEWISE NOT
APPLICABLE.
3. AS A COROLLARY TO THE FIRST TWO GROUNDS, THE COURT OF APPEALS ERRED IN NOT
HOLDING THAT PHILIPPINE PUBLIC POLICY REQUIRED THE ASSUMPTION, NOT THE
RELINQUISHMENT, BY THE TRIAL COURT OF ITS RIGHTFUL JURISDICTION IN THE CIVIL ACTION FOR
THERE IS EVERY REASON TO PROTECT AND VINDICATE PETITIONERS RIGHTS FOR TORTIOUS OR
WRONGFUL ACTS OR CONDUCT PRIVATE RESPONDENTS (WHO ARE MOSTLY NON-RESIDENT ALIENS)
INFLICTED UPON THEM HERE IN THE PHILIPPINES.
We will deal with these contentions in the order in which they are made.
First. It is important to note in connection with the first point that while the present case was
pending in the Court of Appeals, the United States District Court for the Southern District of Texas
rendered judgment[5] in the case before it. The judgment, which was in favor of private
respondents, was affirmed on appeal by the Circuit Court of Appeals. [6] Thus, the principal issue to
be resolved in this case is whether Civil Case No. 16536 is barred by the judgment of the U.S. court.
Private respondents contend that for a foreign judgment to be pleaded as res judicata, a judgment
admitting the foreign decision is not necessary. On the other hand, petitioners argue that the
foreign judgment cannot be given the effect of res judicata without giving them an opportunity to
impeach it on grounds stated in Rule 39, 50 of the Rules of Court, to wit: want of jurisdiction, want
of notice to the party, collusion, fraud, or clear mistake of law or fact.
Petitioners contention is meritorious. While this Court has given the effect of res judicata to foreign
judgments in several cases,[7] it was after the parties opposed to the judgment had been given
ample opportunity to repel them on grounds allowed under the law. [8] It is not necessary for this
purpose to initiate a separate action or proceeding for enforcement of the foreign judgment. What
is essential is that there is opportunity to challenge the foreign judgment, in order for the court to
properly determine its efficacy. This is because in this jurisdiction, with respect to actions in
personam, as distinguished from actions in rem, a foreign judgment merely constitutes prima facie
evidence of the justness of the claim of a party and, as such, is subject to proof to the contrary.
[9]
Rule 39, 50 provides:

SEC. 50. Effect of foreign judgments. - The effect of a judgment of a tribunal of a foreign country,
having jurisdiction to pronounce the judgment is as follows:

(a) In case of a judgment upon a specific thing, the judgment is conclusive upon the title to the
thing;
(b) In case of a judgment against a person, the judgment is presumptive evidence of a right as
between the parties and their successors in interest by a subsequent title; but the judgment may
be repelled by evidence of a want of jurisdiction, want of notice to the party, collusion, fraud, or
clear mistake of law or fact.

Thus, in the case of General Corporation of the Philippines v. Union Insurance Society of Canton,
Ltd.,[10] which private respondents invoke for claiming conclusive effect for the foreign judgment in
their favor, the foreign judgment was considered res judicata because this Court found from the
evidence as well as from appellants own pleadings [11] that the foreign court did not make a clear
mistake of law or fact or that its judgment was void for want of jurisdiction or because of fraud or
collusion by the defendants. Trial had been previously held in the lower court and only afterward
was a decision rendered, declaring the judgment of the Supreme Court of the State of Washington
to have the effect of res judicata in the case before the lower court. In the same vein, in Philippine
International Shipping Corp. v. Court of Appeals,[12] this Court held that the foreign judgment was
valid and enforceable in the Philippines there being no showing that it was vitiated by want of
notice to the party, collusion, fraud or clear mistake of law or fact. The prima facie presumption
under the Rule had not been rebutted.
In the case at bar, it cannot be said that petitioners were given the opportunity to challenge the
judgment of the U.S. court as basis for declaring it res judicata or conclusive of the rights of private
respondents. The proceedings in the trial court were summary. Neither the trial court nor the
appellate court was even furnished copies of the pleadings in the U.S. court or apprised of the
evidence presented thereat, to assure a proper determination of whether the issues then being
litigated in the U.S. court were exactly the issues raised in this case such that the judgment that
might be rendered would constitute res judicata. As the trial court stated in its disputed order dated
March 9, 1988:

On the plaintiffs claim in its Opposition that the causes of action of this case and the pending case
in the United States are not identical, precisely the Order of January 26, 1988 never found that the
causes of action of this case and the case pending before the USA Court, were identical . (emphasis
added)

It was error therefore for the Court of Appeals to summarily rule that petitioners action is barred by
the principle of res judicata. Petitioners in fact questioned the jurisdiction of the U.S. court over
their persons, but their claim was brushed aside by both the trial court and the Court of Appeals. [13]
Moreover, the Court notes that on April 22, 1992, 1488, Inc. and Daic filed a petition for the
enforcement of judgment in the Regional Trial Court of Makati, where it was docketed as Civil Case
No. 92-1070 and assigned to Branch 134, although the proceedings were suspended because of the
pendency of this case. To sustain the appellate courts ruling that the foreign judgment
constitutes res judicata and is a bar to the claim of petitioners would effectively preclude
petitioners from repelling the judgment in the case for enforcement. An absurdity could then
arise: a foreign judgment is not subject to challenge by the plaintiff against whom it is invoked, if it
is pleaded to resist a claim as in this case, but it may be opposed by the defendant if the foreign
judgment is sought to be enforced against him in a separate proceeding. This is plainly
untenable. It has been held therefore that:

[A] foreign judgment may not be enforced if it is not recognized in the jurisdiction where affirmative
relief is being sought. Hence, in the interest of justice, the complaint should be considered as a
petition for the recognition of the Hongkong judgment under Section 50 (b), Rule 39 of the Rules of
Court in order that the defendant, private respondent herein, may present evidence of lack of
jurisdiction, notice, collusion, fraud or clear mistake of fact and law, if applicable. [14]

Accordingly, to insure the orderly administration of justice, this case and Civil Case No. 92-1070
should be consolidated.[15] After all, the two have been filed in the Regional Trial Court of Makati,
albeit in different salas, this case being assigned to Branch 56 (Judge Fernando V. Gorospe), while
Civil Case No. 92-1070 is pending in Branch 134 of Judge Ignacio Capulong.In such proceedings,
petitioners should have the burden of impeaching the foreign judgment and only in the event they
succeed in doing so may they proceed with their action against private respondents.
Second. Nor is the trial courts refusal to take cognizance of the case justifiable under the principle
of forum non conveniens. First, a motion to dismiss is limited to the grounds under Rule 16, 1,
which does not include forum non conveniens.[16] The propriety of dismissing a case based on this
principle requires a factual determination, hence, it is more properly considered a matter of
defense. Second, while it is within the discretion of the trial court to abstain from assuming
jurisdiction on this ground, it should do so only after vital facts are established, to determine
whether special circumstances require the courts desistance. [17]
In this case, the trial court abstained from taking jurisdiction solely on the basis of the pleadings
filed by private respondents in connection with the motion to dismiss. It failed to consider that one
of the plaintiffs (PHILSEC) is a domestic corporation and one of the defendants (Ventura Ducat) is a
Filipino, and that it was the extinguishment of the latters debt which was the object of the
transaction under litigation. The trial court arbitrarily dismissed the case even after finding that
Ducat was not a party in the U.S. case.
Third. It was error we think for the Court of Appeals and the trial court to hold that jurisdiction over
1488, Inc. and Daic could not be obtained because this is an action in personam and summons
were served by extraterritorial service. Rule 14, 17 on extraterritorial service provides that service
of summons on a non-resident defendant may be effected out of the Philippines by leave of Court
where, among others, the property of the defendant has been attached within the Philippines. [18] It
is not disputed that the properties, real and personal, of the private respondents had been attached
prior to service of summons under the Order of the trial court dated April 20, 1987. [19]
Fourth. As for the temporary restraining order issued by the Court on June 29, 1994, to suspend the
proceedings in Civil Case No. 92-1445 filed by Edgardo V. Guevarra to enforce so-called Rule 11
sanctions imposed on the petitioners by the U.S. court, the Court finds that the judgment sought to
be enforced is severable from the main judgment under consideration in Civil Case No. 16563. The
separability of Guevarras claim is not only admitted by petitioners, [20] it appears from the pleadings
that petitioners only belatedly impleaded Guevarra as defendant in Civil Case No. 16563. [21] Hence,
the TRO should be lifted and Civil Case No. 92-1445 allowed to proceed.
WHEREFORE, the decision of the Court of Appeals is REVERSED and Civil Case No. 16563 is
REMANDED to the Regional Trial Court of Makati for consolidation with Civil Case No. 92-1070 and
for further proceedings in accordance with this decision. The temporary restraining order issued on
June 29, 1994 is hereby LIFTED.
SO ORDERED.
Regalado, (Chairman), Romero, Puno, and Torres, Jr., JJ., concur.

[1]
Now BPI-International Finance Ltd. (hereafter called BPI-IFL).
[2]
Records, p. 58.
[3]
Per Judge Fernando V. Gorospe, Jr.
[4]
Per Associate Justice Consuelo Ynares-Santiago with Associate Justices Ricardo L. Pronove, Jr. and
Nicolas P. Lapea, Jr., concurring.
[5]
C.A. Rollo, pp. 205-206.
[6]
Rollo, p. 303.
[7]
Philippine International Shipping Corp. v. Court of Appeals, 172 SCRA 810 (1989);
Nagarmull v. Binalbagan-Isabela Sugar Co., Inc., 33 SCRA 46 (1970); General Corporation of the
Philippines v. Union Insurance Society of Canton Ltd., G.R. No. L-2303, Dec. 29, 1951 (unreported);
Boudard v. Tait, 67 Phil. 170 (1939).
[8]
Hang Lung Bank v. Saulog, 201 SCRA 137 (1991).
[9]
Boudard v. Tait, 67 Phil. 170.
[10]
G.R. No. L-2303, Dec. 29, 1951.
[11]
Id., p. 6.
[12]
172 SCRA 810.
[13]
C.A. Decision, p. 6; Rollo, p. 52.
[14]
Hang Lung Bank v. Saulog, 201 SCRA 137.
[15]
Borromeo v. Intermediate Appellate Court, 255 SCRA 75 (1995).
[16]
Development Bank of the Philippines v. Pundogar, 218 SCRA 118 (1993).
[17]
K.K. Shell Sekiyu Osaka Hatsubaisho v. Court of Appeals, 188 SCRA 145 at 153 (1990);
Hongkong and Shanghai Banking Corp. v. Sherban, 176 SCRA 331 at 339 (1987).
[18]
Rule 14, 17.
SEC. 17. Extraterritorial service. - When the defendant does not reside and is not found in the
Philippines and the action affects the personal status of the plaintiff or relates to, or the subject of
which is, property within the Philippines, in which the defendant has or claims a lien or interest,
actual or contingent, or in which the relief demanded consists, wholly or in part, in excluding the
defendant from any interest therein, or the property of the defendant from any interest therein, or
the property of the defendant has been attached within the Philippines, service may, by leave of
court, be effected out of the Philippines by personal service as under section 7; or by publication in
a newspaper of general circulation in such places and for such time as the court may order, in
which case a copy of the summons and order of the court shall be sent by registered mail to the
last known address of the defendant, or in any other manner the court may deem sufficient. Any
order granting such leave shall specify a reasonable time, which shall not be less than sixty (60)
days after notice, within which the defendant must answer. (emphasis added)
[19]
Records, pp. 58, 80 and 100. (Sheriffs Report, Record, p. 100).
[20]
Rollo, p. 353.
[21]
Edgardo V. Guevara was impleaded as party defendant in petitioners amended complaint on
March 31, 1992.
World-Wide Volkwagen Corp. v. Woodson

No. 78-1078

Argued October 3, 1979

Decided January 21, 1980

444 U.S. 286

CERTIORARI TO THE SUPREME COURT OF OKLAHOMA

Syllabus

A products liability action was instituted in an Oklahoma st,ate court by respondents husband and
wife to recover for personal injuries sustained in Oklahoma in an accident involving an automobile
that had been purchased by them in New York while they were New York residents and that was
being driven through Oklahoma at the time of the accident. The defendants included the
automobile retailer and its wholesaler (petitioners), New York corporations that did no business in
Oklahoma. Petitioners entered special appearances, claiming that Oklahoma's exercise of
jurisdiction over them would offend limitations on the State's jurisdiction imposed by the Due
Process Clause of the Fourteenth Amendment. The trial court rejected petitioners' claims, and they
then sought, but were denied, a writ of prohibition in the Oklahoma Supreme Court to restrain
respondent trial judge from exercising in personam jurisdiction over them.

Held: Consistently with the Due Process Clause, the Oklahoma trial court may not exercise in
personam jurisdiction over petitioners. Pp. 444 U. S. 291-299.

(a) A state court may exercise personal jurisdiction over a nonresident defendant only so long as
there exist "minimum contacts" between the defendant and the forum State. International Shoe
Co. v. Washington, 326 U. S. 310. The defendant's contacts with the forum State must be such that
maintenance of the suit does not offend traditional notions of fair play and substantial
justice, id. at 326 U. S. 316, and the relationship between the defendant and the forum must be
such that it is "reasonable . . . to require the corporation to defend the particular suit which is
brought there," id. at 326 U. S. 317. The Due Process Clause

"does not contemplate that a state may make binding a judgment in personam against an
individual or corporate defendant with which the state has no contacts, ties, or relations."

Id. at 326 U. S. 319. Pp. 444 U. S. 291-294.

(b) Here, there is a total absence in the record of those affiliating circumstances that are a
necessary predicate to any exercise of state court jurisdiction. Petitioners carry on no activity
whatsoever in Oklahoma; they close no sales and perform no services there, avail

Page 444 U. S. 287

themselves of none of the benefits of Oklahoma law, and solicit no business there either through
salespersons or through advertising reasonably calculated to reach that State. Nor does the record
show that they regularly sell cars to Oklahoma residents, or that they indirectly, through others,
serve or seek to serve the Oklahoma market. Although it is foreseeable that automobiles sold by
petitioners would travel to Oklahoma and that the automobile here might cause injury in
Oklahoma, "foreseeability" alone is not a sufficient benchmark for personal jurisdiction under the
Due Process Clause. The foreseeability that is critical to due process analysis is not the mere
likelihood that a product will find its way into the forum State, but rather is that the defendant's
conduct and connection with the forum are such that he should reasonably anticipate being haled
into court there. Nor can jurisdiction be supported on the theory that petitioners earn substantial
revenue from goods used in Oklahoma. Pp. 444 U. S. 295-299.

585 P.2d 351, reversed.

WHITE, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, POWELL,
REHNQUIST, and STEVENS, JJ., joined. BRENNAN, J., filed a dissenting opinion, post, p. 444 U. S.
299. MARSHALL, J., filed a dissenting opinion, in which BLACKMUN, J., joined, post, p. 444 U. S. 313.
BLACKMUN, J., filed a dissenting opinion, post, p. 444 U. S. 317.

MR. JUSTICE WHITE delivered the opinion of the Court.

The issue before us is whether, consistently with the Due Process Clause of the Fourteenth
Amendment, an Oklahoma court may exercise in personam jurisdiction over a nonresident
automobile retailer and its wholesale distributor in a products liability action, when the defendants'
only connection with Oklahoma is the fact that an automobile sold in New York to New York
residents became involved in an accident in Oklahoma.

Page 444 U. S. 288

Respondents Harry and Kay Robinson purchased a new Audi automobile from petitioner Seaway
Volkswagen, Inc. (Seaway), in Massena, N.Y. in 1976. The following year, the Robinson family, who
resided in New York, left that State for a new home in Arizona. As they passed through the State of
Oklahoma, another car struck their Audi in the rear, causing a fire which severely burned Kay
Robinson and her two children. [Footnote 1]

The Robinsons [Footnote 2] subsequently brought a products liability action in the District Court for
Creek County, Okla., claiming that their injuries resulted from defective design and placement of
the Audi's gas tank and fuel system. They joined as defendants the automobile's manufacturer,
Audi NSU Auto Union Aktiengesellschaft (Audi); its importer, Volkswagen of America, Inc.
(Volkswagen); its regional distributor, petitioner World-Wide Volkswagen Corp. (World-Wide); and its
retail dealer, petitioner Seaway. Seaway and World-Wide entered special appearances, [Footnote 3]
claiming that Oklahoma's exercise of jurisdiction over them would offend the limitations on the
State's jurisdiction imposed by the Due Process Clause of the Fourteenth Amendment. [Footnote 4]

The facts presented to the District Court showed that World-Wide is incorporated and has its
business office in New

Page 444 U. S. 289

York. It distributes vehicles, parts, and accessories, under contract with Volkswagen, to retail
dealers in New York, New Jersey, and Connecticut. Seaway, one of these retail dealers, is
incorporated and has its place of business in New York. Insofar as the record reveals, Seaway and
World-Wide are fully independent corporations whose relations with each other and with
Volkswagen and Audi are contractual only. Respondents adduced no evidence that either World-
Wide or Seaway does any business in Oklahoma, ships or sells any products to or in that State, has
an agent to receive process there, or purchases advertisements in any media calculated to reach
Oklahoma. In fact, as respondents' counsel conceded at oral argument, Tr. of Oral Arg 32, there was
no showing that any automobile sold by World-Wide or Seaway has ever entered Oklahoma, with
the single exception of the vehicle involved in the present case.

Despite the apparent paucity of contacts between petitioners and Oklahoma, the District Court
rejected their constitutional claim and reaffirmed that ruling in denying petitioners' motion for
reconsideration. [Footnote 5] Petitioners then sought a writ of prohibition in the Supreme Court of
Oklahoma to restrain the District Judge, respondent Charles S. Woodson, from exercising in
personam jurisdiction over them. They renewed their contention that, because they had no
"minimal contacts," App. 32, with the State of Oklahoma, the actions of the District Judge were in
violation of their rights under the Due Process Clause.

The Supreme Court of Oklahoma denied the writ, 585 P.2d 351 (1978), [Footnote 6] holding that
personal jurisdiction over petitioners was authorized by Oklahoma's "long-arm" statute,

Page 444 U. S. 290

Okla.Stat., Tit. 12, 1701.03(a)(4) (1971). [Footnote 7] Although the court noted that the proper
approach was to test jurisdiction against both statutory and constitutional standards, its analysis
did not distinguish these questions, probably because 1701.03(a)(4) has been interpreted as
conferring jurisdiction to the limits permitted by the United States Constitution. [Footnote 8] The
court's rationale was contained in the following paragraph, 585 P.2d at 354:

"In the case before us, the product being sold and distributed by the petitioners is, by its very
design and purpose, so mobile that petitioners can foresee its possible use in Oklahoma. This is
especially true of the distributor, who has the exclusive right to distribute such automobile in New
York, New Jersey and Connecticut. The evidence presented below demonstrated that goods sold
and distributed by the petitioners were used in the State of Oklahoma, and, under the facts, we
believe it reasonable to infer, given the retail value of the automobile, that the petitioners derive
substantial income from automobiles which from time to time are used in the State of Oklahoma.
This being the case, we hold that, under the facts presented, the trial court was justified in
concluding

Page 444 U. S. 291

that the petitioners derive substantial revenue from goods used or consumed in this State."

We granted certiorari, 440 U.S. 907 (1979), to consider an important constitutional question with
respect to state court jurisdiction and to resolve a conflict between the Supreme Court of Oklahoma
and the highest courts of at least four other States. [Footnote 9] We reverse.

II
The Due Process Clause of the Fourteenth Amendment limits the power of a state court to render a
valid personal judgment against a nonresident defendant. Kulko v. California Superior Court, 436 U.
S. 84, 436 U. S. 91 (1978). A judgment rendered in violation of due process is void in the rendering
State and is not entitled to full faith and credit elsewhere.Pennoyer v. Neff, 95 U. S. 714, 95 U. S.
732-733 (1878). Due process requires that the defendant be given adequate notice of the
suit, Mullane v. Central Hanover Trust Co., 339 U. S. 306, 339 U. S. 313-314 (1950), and be subject
to the personal jurisdiction of the court, International Shoe Co. v. Washington, 326 U. S. 310 (1945).
In the present case, it is not contended that notice was inadequate; the only question is whether
these particular petitioners were subject to the jurisdiction of the Oklahoma courts.

As has long been settled, and as we reaffirm today, a state court may exercise personal jurisdiction
over a nonresident defendant only so long as there exist "minimum contacts" between the
defendant and the forum State. International Shoe Co. v. Washington, supra at 326 U. S. 316. The
concept of minimum contacts, in turn, can be seen to perform two related, but

Page 444 U. S. 292

distinguishable, functions. It protects the defendant against the burdens of litigating in a distant or
inconvenient forum. And it acts to ensure that the States, through their courts, do not reach out
beyond the limits imposed on them by their status as coequal sovereigns in a federal system.

The protection against inconvenient litigation is typically described in terms of "reasonableness" or

"fairness." We have said that the defendant's contacts with the forum State must be such that
maintenance of the suit "does not offend traditional notions of fair play and substantial
justice.'" International Shoe Co. v. Washington, supra at 326 U. S. 316, quoting Milliken v.
Meyer, 311 U. S. 457, 311 U. S. 463 (1940). The relationship between the defendant and the forum
must be such that it is "reasonable . . . to require the corporation to defend the particular suit
which is brought there." 326 U.S. at 326 U. S. 317. Implicit in this emphasis on reasonableness is
the understanding that the burden on the defendant, while always a primary concern, will in an
appropriate case be considered in light of other relevant factors, including the forum State's
interest in adjudicating the dispute, see McGee v. International Life Ins. Co., 355 U. S. 220, 355 U.
S. 223 (1957); the plaintiff's interest in obtaining convenient and effective relief, see Kulko v.
California Superior Court, supra at 436 U. S. 92, at least when that interest is not adequately
protected by the plaintiff's power to choose the forum, cf. Shaffer v. Heitner, 433 U. S. 186, 433 U.
S. 211, n. 37 (1977); the interstate judicial system's interest in obtaining the most efficient
resolution of controversies; and the shared interest of the several States in furthering fundamental
substantive social policies, see Kulko v. California Superior Court, supra at 436 U. S. 93, 436 U. S.
98.

The limits imposed on state jurisdiction by the Due Process Clause, in its role as a guarantor
against inconvenient litigation, have been substantially relaxed over the years. As we noted
in McGee v. International Life Ins. Co., supra at 355 U. S. 222-223,

Page 444 U. S. 293

this trend is largely attributable to a fundamental transformation in the American economy:

"Today many commercial transactions touch two or more States, and may involve parties separated
by the full continent. With this increasing nationalization of commerce has come a great increase in
the amount of business conducted by mail across state lines. At the same time, modern
transportation and communication have made it much less burdensome for a party sued to defend
himself in a State where he engages in economic activity."

The historical developments noted in McGee, of course, have only accelerated in the generation
since that case was decided.

Nevertheless, we have never accepted the proposition that state lines are irrelevant for
jurisdictional purposes, nor could we and remain faithful to the principles of interstate federalism
embodied in the Constitution. The economic interdependence of the States was foreseen and
desired by the Framers. In the Commerce Clause, they provided that the Nation was to be a
common market, a "free trade unit" in which the States are debarred from acting as separable
economic entities. H. P. Hood Sons, Inc. v. Du Mond, 336 U. S. 525, 336 U. S. 538 (1949). But the
Framers also intended that the States retain many essential attributes of sovereignty, including, in
particular, the sovereign power to try causes in their courts. The sovereignty of each State, in turn,
implied a limitation on the sovereignty of all of its sister States -- a limitation express or implicit in
both the original scheme of the Constitution and the Fourteenth Amendment.

Hence, even while abandoning the shibboleth that "[t]he authority of every tribunal is necessarily
restricted by the territorial limits of the State in which it is established," Pennoyer v. Neff,
supra, at 95 U. S. 720, we emphasized that the reasonableness of asserting jurisdiction over the
defendant must be assessed "in the context of our federal system of government,"

Page 444 U. S. 294

International Shoe Co. v. Washington, 326 U.S. at 326 U. S. 317, and stressed that the Due Process
Clause ensures not only fairness, but also the "orderly administration of the laws," id. at 326 U. S.
319. As we noted in Hanson v. Denckla, 357 U. S. 235, 357 U. S. 250-251 (1958):

"As technological progress has increased the flow of commerce between the States, the need for
jurisdiction over nonresidents has undergone a similar increase. At the same time, progress in
communications and transportation has made the defense of a suit in a foreign tribunal less
burdensome. In response to these changes, the requirements for personal jurisdiction over
nonresidents have evolved from the rigid rule of Pennoyer v. Neff, 95 U. S. 714, to the flexible
standard of International Shoe Co. v. Washington, 326 U. S. 310. But it is a mistake to assume that
this trend heralds the eventual demise of all restrictions on the personal jurisdiction of state courts.
[Citation omitted.] Those restrictions are more than a guarantee of immunity from inconvenient or
distant litigation. They are a consequence of territorial limitations on the power of the respective
States."

Thus, the Due Process Clause

"does not contemplate that a state may make binding a judgment in personam against an
individual or corporate defendant with which the state has no contacts, ties, or relations."

International Shoe Co. v. Washington, supra at 326 U. S. 319. Even if the defendant would suffer
minimal or no inconvenience from being forced to litigate before the tribunals of another State;
even if the forum State has a strong interest in applying its law to the controversy; even if the
forum State is the most convenient location for litigation, the Due Process Clause, acting as an
instrument of interstate federalism, may sometimes act to divest the State of its power to render a
valid judgment. Hanson v. Denckla, supra at 357 U. S. 251, 357 U. S. 254.

Page 444 U. S. 295

III

Applying these principles to the case at hand, [Footnote 10] we find in the record before us a total
absence of those affiliating circumstances that are a necessary predicate to any exercise of state
court jurisdiction. Petitioners carry on no activity whatsoever in Oklahoma. They close no sales and
perform no services there. They avail themselves of none of the privileges and benefits of
Oklahoma law. They solicit no business there either through salespersons or through advertising
reasonably calculated to reach the State. Nor does the record show that they regularly sell cars at
wholesale or retail to Oklahoma customers or residents, or that they indirectly, through others,
serve or seek to serve the Oklahoma market. In short, respondents seek to base jurisdiction on one,
isolated occurrence and whatever inferences can be drawn therefrom: the fortuitous circumstance
that a single Audi automobile, sold in New York to New York residents, happened to suffer an
accident while passing through Oklahoma.

It is argued, however, that, because an automobile is mobile by its very design and purpose, it was
"foreseeable" that the Robinsons' Audi would cause injury in Oklahoma. Yet "foreseeability" alone
has never been a sufficient benchmark for personal jurisdiction under the Due Process Clause.
In Hanson v. Denckla, supra, it was no doubt foreseeable that the settlor of a Delaware trust would
subsequently move to Florida and seek to exercise a power of appointment there; yet we held that
Florida courts could not constitutionally

Page 444 U. S. 296

exercise jurisdiction over a Delaware trustee that had no other contacts with the forum State.
In Kulko v. California Superior Court, 436 U. S. 84 (1978), it was surely "foreseeable" that a divorced
wife would move to California from New York, the domicile of the marriage, and that a minor
daughter would live with the mother. Yet we held that California could not exercise jurisdiction in a
child support action over the former husband, who had remained in New York.

If foreseeability were the criterion, a local California tire retailer could be forced to defend in
Pennsylvania when a blowout occurs there, see Erlanger Mills, Inc. v. Cohoes Fibre Mills, Inc., 239
F.2d 502, 507 (CA4 1956); a Wisconsin seller of a defective automobile jack could be haled before a
distant court for damage caused in New Jersey, Reilly v. Phil Tolkan Pontiac, Inc., 372 F.Supp. 1205
(NJ 1974); or a Florida soft-drink concessionaire could be summoned to Alaska to account for
injuries happening there, see Uppgren v. Executive Aviation Services, Inc., 304 F.Supp. 165, 170-
171 (Minn.1969). Every seller of chattels would, in effect, appoint the chattel his agent for service
of process. His amenability to suit would travel with the chattel. We recently abandoned the
outworn rule of Harris v. Balk, 198 U. S. 215 (1905), that the interest of a creditor in a debt could be
extinguished or otherwise affected by any State having transitory jurisdiction over the
debtor.Shaffer v. Heitner, 433 U. S. 186 (1977). Having interred the mechanical rule that a creditor's
amenability to a quasi in remaction travels with his debtor, we are unwilling to endorse an
analogous principle in the present case. [Footnote 11]

Page 444 U. S. 297

This is not to say, of course, that foreseeability is wholly irrelevant. But the foreseeability that is
critical to due process analysis is not the mere likelihood that a product will find its way into the
forum State. Rather, it is that the defendant's conduct and connection with the forum State are
such that he should reasonably anticipate being haled into court there.See Kulko v. California
Superior Court, supra at 436 U. S. 97-98; Shaffer v. Heitner, 433 U.S. at 433 U. S. 216; and see
id. at 433 U. S. 217-219 (STEVENS, J., concurring in judgment). The Due Process Clause, by
ensuring the "orderly administration of the laws," International Shoe Co. v. Washington, 326 U.S.
at 326 U. S. 319, gives a degree of predictability to the legal system that allows potential
defendants to structure their primary conduct with some minimum assurance as to where that
conduct will and will not render them liable to suit.

When a corporation "purposefully avails itself of the privilege of conducting activities within the
forum State," Hanson v. Denckla, 357 U.S. at 357 U. S. 253, it has clear notice that it is subject to
suit there, and can act to alleviate the risk of burdensome litigation by procuring insurance, passing
the expected costs on to customers, or, if the risks are too great, severing its connection with the
State. Hence if the sale of a product of a manufacturer or distributor such as Audi or Volkswagen is
not simply an isolated occurrence, but arises from the efforts of the manufacturer or distributor to
serve, directly or indirectly, the market for its product in other States, it is not unreasonable to
subject it to suit in one of those States if its allegedly defective merchandise has there been the
source of injury to its owner or to others. The forum State does not

Page 444 U. S. 298

exceed its powers under the Due Process Clause if it asserts personal jurisdiction over a corporation
that delivers its products into the stream of commerce with the expectation that they will be
purchased by consumers in the forum State.Cf. Gray v. American Radiator & Standard Sanitary
Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961).

But there is no such or similar basis for Oklahoma jurisdiction over World-Wide or Seaway in this
case. Seaway's sales are made in Massena, N. Y. World-Wide's market, although substantially
larger, is limited to dealers in New York, New Jersey, and Connecticut. There is no evidence of
record that any automobiles distributed by World-Wide are sold to retail customers outside this
tristate area. It is foreseeable that the purchasers of automobiles sold by World-Wide and Seaway
may take them to Oklahoma. But the mere "unilateral activity of those who claim some relationship
with a nonresident defendant cannot satisfy the requirement of contact with the forum
State." Hanson v. Denckla, supra, at 357 U. S. 253.

In a variant on the previous argument, it is contended that jurisdiction can be supported by the fact
that petitioners earn substantial revenue from goods used in Oklahoma. The Oklahoma Supreme
Court so found, 585 P.2d at 354-355, drawing the inference that, because one automobile sold by
petitioners had been used in Oklahoma, others might have been used there also. While this
inference seems less than compelling on the facts of the instant case, we need not question the
court's factual findings in order to reject its reasoning.

This argument seems to make the point that the purchase of automobiles in New York, from which
the petitioners earn substantial revenue, would not occur but for the fact that the automobiles are
capable of use in distant States like Oklahoma. Respondents observe that the very purpose of an
automobile is to travel, and that travel of automobiles sold by petitioners is facilitated by an
extensive chain of Volkswagen service centers throughout the country, including some in
Oklahoma. [Footnote 12]
Page 444 U. S. 299

However, financial benefits accruing to the defendant from a collateral relation to the forum State
will not support jurisdiction if they do not stem from a constitutionally cognizable contact with that
State. See Kulko v. California Superior Court, 436 U.S. at 436 U. S. 94-95. In our view, whatever
marginal revenues petitioners may receive by virtue of the fact that their products are capable of
use in Oklahoma is far too attenuated a contact to justify that State's exercise of in
personam jurisdiction over them.

Because we find that petitioners have no "contacts, ties, or relations" with the State of
Oklahoma, International Shoe Co. v. Washington, supra, at 326 U. S. 319, the judgment of the
Supreme Court of Oklahoma is

Reversed.

[Footnote 1]

The driver of the other automobile does not figure in the present litigation .

[Footnote 2]

Kay Robinson sued on her own behalf. The two children sued through Harry Robinson as their father and next
friend.

[Footnote 3]

Volkswagen also entered a special appearance in the District Court, but, unlike World-Wide and Seaway, did
not seek review in the Supreme Court of Oklahoma, and is not a petitioner here. Both Volkswagen and Audi
remain as defendants in the litigation pending before the District Court in Oklahoma.

[Footnote 4]

The papers filed by the petitioners also claimed that the District Court lacked "venue of the subject matter,"
App. 9, or "venue over the subject matter," id. at 11.

[Footnote 5]

The District Court's rulings are unreported, and appear at App. 13 and 20.

[Footnote 6]

Five judges joined in the opinion. Two concurred in the result, without opinion, and one concurred in part and
dissented in part, also without opinion.

[Footnote 7]

This subsection provides:

"A court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of
action or claim for relief arising from the persons . . . causing tortious injury in this state by an act or omission
outside this state if he regularly does or solicits business or engages in any other persistent course of
conduct, or derives substantial revenue from goods used or consumed or services rendered, in this state. . . ."

The State Supreme Court rejected jurisdiction based on 1701.03(a)(3), which authorizes jurisdiction over
any person "causing tortious injury in this state by an act or omission in this state." Something in addition to
the infliction of tortious injury was required.

[Footnote 8]

Fields v. Volkswagen of America, Inc., 555 P.2d 48 (Okla.1976); Carmack v. Chemical Bank New York Trust
Co., 536 P.2d 897 (Okla.1975); Hines v. Clendennin, 465 P.2d 460 (Okla.1970).

[Footnote 9]

Cf. Tilley v. Keller Truck & Implement Corp., 200 Kan. 641, 438 P.2d 128 (1968); Granite States Volkswagen,
Inc. v. District Court,177 Colo. 42, 492 P.2d 624 (1972); Pellegrini v. Sachs & Sons, 522 P.2d 704 (Utah
1974); Oliver v. American Motors Corp., 70 Wash.2d 875, 425 P.2d 647 (1967).

[Footnote 10]

Respondents argue, as a threshold matter, that petitioners waived any objections to personal jurisdiction by
(1) joining with their special appearances a challenge to the District Court's subject matter
jurisdiction, see n 4, supra, and (2) taking depositions on the merits of the case in Oklahoma. The trial court,
however, characterized the appearances as "special," and the Oklahoma Supreme Court, rather than finding
jurisdiction waived, reached and decided the statutory and constitutional questions. Cf. Kulko v. California
Superior Court, 436 U. S. 84, 436 U. S. 91, n. 5 (1978).

[Footnote 11]

Respondents' counsel, at oral argument, see Tr. of Oral Arg.19-22, 29, sought to limit the reach of the
foreseeability standard by suggesting that there is something unique about automobiles. It is true that
automobiles are uniquely mobile, see Tyson v. Whitaker & Son, Inc., 407 A.2d 1, 6, and n. 11 (Me.1979)
(McKusick, C.J.), that they did play a crucial role in the expansion of personal jurisdiction through the fiction of
implied consent, e.g., Hess v. Pawloski, 274 U. S. 352 (1927), and that some of the cases have treated the
automobile as a "dangerous instrumentality." But today, under the regime of International Shoe, we see no
difference for jurisdictional purposes between an automobile and any other chattel. The "dangerous
instrumentality" concept apparently was never used to support personal jurisdiction; and to the extent it has
relevance today, it bears not on jurisdiction, but on the possible desirability of imposing substantive
principles of tort law such as strict liability.

[Footnote 12]

As we have noted, petitioners earn no direct revenues from these service centers. See supra at 444 U. S. 289.

MR. JUSTICE BRENNAN, dissenting. *

The Court holds that the Due Process Clause of the Fourteenth Amendment bars the States from
asserting jurisdiction over the defendants in these two cases. In each case, the Court so decides
because it fails to find the "minimum contacts" that have been required since International Shoe
Co. v. Washington, 326 U. S. 310, 326 U. S. 316 (1945). Because I believe that the Court
reads International Shoe and its progeny too narrowly, and because I believe that the standards
enunciated by those cases may already be obsolete as constitutional boundaries, I dissent.
I

The Court's opinions focus tightly on the existence of contacts between the forum and the
defendant. In so doing, they accord too little weight to the strength of the forum State's interest in
the case, and fail to explore whether there

Page 444 U. S. 300

would be any actual inconvenience to the defendant. The essential inquiry in locating the
constitutional limits on state court jurisdiction over absent defendants is whether the particular
exercise of jurisdiction offends "traditional notions of fair play and substantial
justice.'" International Shoe, supra at 326 U. S. 316, quoting Milliken v. Meyer, 311 U. S. 457, 311 U.
S. 463 (1940). The clear focus in International Shoe was on fairness and reasonableness. Kulko v.
California Superior Court, 436 U. S. 84, 436 U. S. 92 (1978). The Court specifically declined to
establish a mechanical test based on the quantum of contacts between a State and the defendant:

"Whether due process is satisfied must depend, rather, upon the quality and nature of the
activity in relation to the fair and orderly administration of the laws which it was the purpose of the
due process clause to insure. That clause does not contemplate that a state may make binding a
judgment in personam against an individual or corporate defendant with which the state has no
contacts, ties, or relations."

326 U.S. at 326 U. S. 319 (emphasis added). The existence of contacts, so long as there were some,
was merely one way of giving content to the determination of fairness and reasonableness.

Surely International Shoe contemplated that the significance of the contacts necessary to support
jurisdiction would diminish if some other consideration helped establish that jurisdiction would be
fair and reasonable. The interests of the State and other parties in proceeding with the case in a
particular forum are such considerations. McGee v. International Life Ins. Co., 355 U. S. 220, 355 U.
S. 223 (1957), for instance, accorded great importance to a State's "manifest interest in providing
effective means of redress" for its citizens. See also Kulko v. California Superior Court, supra at 436
U. S. 92; Shaffer v. Heitner, 433 U. S. 186, 433 U. S. 208 (1977); Mullane v. Central Hanover Trust
Co., 339 U. S. 306, 339 U. S. 313 (1950).

Another consideration is the actual burden a defendant

Page 444 U. S. 301

must bear in defending the suit in the forum. McGee, supra. Because lesser burdens reduce the
unfairness to the defendant, jurisdiction may be justified despite less significant contacts. The
burden, of course, must be of constitutional dimension. Due process limits on jurisdiction do not
protect a defendant from all inconvenience of travel, McGee, supra at355 U. S. 224, and it would
not be sensible to make the constitutional rule turn solely on the number of miles the defendant
must travel to the courtroom. [Footnote 2/1] Instead, the constitutionally significant "burden" to be
analyzed relates to the mobility of the defendant's defense. For instance, if having to travel to a
foreign forum would hamper the defense because witnesses or evidence or the defendant himself
were immobile, or if there were a disproportionately large number of witnesses or amount of
evidence that would have to be transported at the defendant's expense, or if being away from
home for the duration of the trial would work some special hardship on the defendant, then the
Constitution would require special consideration for the defendant's interests.

That considerations other than contacts between the forum and the defendant are relevant
necessarily means that the Constitution does not require that trial be held in the State which has
the "best contacts" with the defendant. See Shaffer v. Heitner, supra at 433 U. S. 228 (BRENNAN, J.,
dissenting). The defendant has no constitutional entitlement to the best forum or, for that matter,
to any particular forum. Under even the most restrictive view of International Shoe, several States
could have jurisdiction over a particular cause of action. We need only determine whether the
forum States in these cases satisfy the constitutional minimum. [Footnote 2/2]

Page 444 U. S. 302

II

In each of these cases, I would find that the forum State has an interest in permitting the litigation
to go forward, the litigation is connected to the forum, the defendant is linked to the forum, and the
burden of defending is not unreasonable. Accordingly, I would hold that it is neither unfair nor
unreasonable to require these defendants to defend in the forum State.

In No. 78-952, a number of considerations suggest that Minnesota is an interested and convenient
forum. The action was filed by a bona fide resident of the forum. [Footnote 2/3] Consequently,
Minnesota's interests are similar to, even if lesser than, the interests of California in McGee,
supra, "in providing a forum for its residents and in regulating the activities of insurance
companies" doing business in the State. [Footnote 2/4] Post at 444 U. S. 332. Moreover, Minnesota
has "attempted to assert [its] particularized interest in trying such cases in its courts by . . .
enacting a special jurisdictional statute." Kulko, supra at 436 U. S. 98; McGee, supra at 355 U. S.
221, 355 U. S. 224. As in McGee, a resident forced to travel to a distant State to prosecute an
action

Page 444 U. S. 303

against someone who has injured him could, for lack of funds, be entirely unable to bring the cause
of action. The plaintiff's residence in the State makes the State one of a very few convenient fora
for a personal injury case (the others usually being the defendant's home State and the State
where the accident occurred). [Footnote 2/5]

In addition, the burden on the defendant is slight. As Judge Friendly has

recognized, Shaffer emphasizes the importance of identifying the real impact of the
lawsuit. O'Connor v. Lee-Hy Paving Corp., 579 F.2d 194, 00 (CA2 1978) (upholding the
constitutionality of jurisdiction in a very similar case under New York's law after Shaffer). Here the
real impact is on the defendant's insurer, which is concededly amenable to suit in the forum State.
The defendant is carefully protected from financial liability because the action limits the prayer for
damages to the insurance policy's liability limit. [Footnote 2/6] The insurer will handle the case for
the defendant. The defendant is only a nominal party who need be no more active in the case than
the cooperation clause of his policy requires. Because of the ease of airline transportation, he need
not lose significantly more time than if the case were at home. Consequently, if the suit went
forward

Page 444 U. S. 304

in Minnesota, the defendant would bear almost no burden or expense beyond what he would face if
the suit were in his home State. The real impact on the named defendant is the same as it is in a
direct action against the insurer, which would be constitutionally permissible. Watson v. Employers
Liability Assurance Corp., 348 U. S. 66 (1954); Minichiello v. Rosenberg, 410 F.2d 106, 109-110 (CA2
1968). The only distinction is the formal, "analytica[l] prerequisite," post at 444 U. S. 331, of
making the insured a named party. Surely the mere addition of appellant's name to the complaint
does not suffice to create a due process violation. [Footnote 2/7]

Finally, even were the relevant inquiry whether there are sufficient contacts between the forum and
the named defendant, I would find that such contacts exist. The insurer's presence in Minnesota is
an advantage to the defendant that may well have been a consideration in his selecting the policy
he did. An insurer with offices in many States makes it easier for the insured to make claims or
conduct other business that may become necessary while traveling. It is simply not true that "State
Farm's decision to do business in Minnesota was completely adventitious as far as Rush was
concerned." Post at 444 U. S. 328-329. By buying a State Farm policy, the defendant availed
himself of the benefits he might derive from having an insurance agent in Minnesota who could,
among other things, facilitate a suit for appellant against a Minnesota resident. It seems
unreasonable to read the Constitution as permitting one to take advantage of his nationwide
insurance network but not to be burdened by it.

In sum, I would hold that appellant is not deprived of due process by being required to submit to
trial in Minnesota, first because Minnesota has a sufficient interest in and connection

Page 444 U. S. 305

to this litigation and to the real and nominal defendants, and second because the burden on the
nominal defendant is sufficiently slight.

In No. 78-1078, the interest of the forum State and its connection to the litigation is strong. The
automobile accident underlying the litigation occurred in Oklahoma. The plaintiffs were hospitalized
in Oklahoma when they brought suit. Essential witnesses and evidence were in Oklahoma. See
Shaffer v. Heitner, 433 U.S. at 433 U. S. 208. The State has a legitimate interest in enforcing its
laws designed to keep its highway system safe, and the trial can proceed at least as efficiently in
Oklahoma as anywhere else.

The petitioners are not unconnected with the forum. Although both sell automobiles within limited
sales territories, each sold the automobile which, in fact, was driven to Oklahoma, where it was
involved in an accident. [Footnote 2/8] It may be true, as the Court suggests, that each sincerely
intended to limit its commercial impact to the limited territory, and that each intended to accept
the benefits and protection of the laws only of those States within the territory. But obviously these
were unrealistic hopes that cannot be treated as an automatic constitutional shield. [Footnote 2/9]
Page 444 U. S. 306

An automobile simply is not a stationary item or one designed to be used in one place. An
automobile is intended to be moved around. Someone in the business of selling large numbers of
automobiles can hardly plead ignorance of their mobility, or pretend that the automobiles stay put
after they are sold. It is not merely that a dealer in automobiles foresees that they will
move. Ante at 444 U. S. 295. The dealer actually intends that the purchasers will use the
automobiles to travel to distant States where the dealer does not directly "do business." The sale of
an automobile does purposefully inject the vehicle into the stream of interstate commerce so that it
can travel to distant States. See Kulko, 436 U.S. at 436 U. S. 94; Hanson v. Denckla, 357 U. S.
235, 357 U. S. 253 (1958).

This case is similar to Ohio v. Wyandotte Chemicals Corp., 401 U. S. 493 (1971). There we
indicated, in the course of denying leave to file an original jurisdiction case, that corporations
having no direct contact with Ohio could constitutionally be brought to trial in Ohio because they
dumped pollutants into streams outside Ohio's limits which ultimately, through the action of the
water, reached Lake Erie and affected Ohio. No corporate acts, only their consequences, occurred
in Ohio. The stream of commerce is just as natural a force as a stream of water, and it was equally
predictable that the cars petitioners released would reach distant states. [Footnote 2/10]

The Court accepts that a State may exercise jurisdiction over a distributor which "serves" that State
"indirectly" by "deliver[ing] its products into the stream of commerce with the expectation that
they will be purchased by consumers in the forum State." Ante at 444 U. S. 297-298. It is difficult to
see why the Constitution should distinguish between a case involving

Page 444 U. S. 307

goods which reach a distant State through a chain of distribution and a case involving goods which
reach the same State because a consumer, using them as the dealer knew the customer would,
took them there. [Footnote 2/11] In each case, the seller purposefully injects the goods into the
stream of commerce, and those goods predictably are used in the forum State. [Footnote 2/12]

Furthermore, an automobile seller derives substantial benefits from States other than its own. A
large part of the value of automobiles is the extensive, nationwide network of highways. Significant
portions of that network have been constructed by, and are maintained by, the individual States,
including Oklahoma. The States, through their highway programs, contribute in a very direct and
important way to the value of petitioners' businesses. Additionally, a network of other related
dealerships with their service departments operates throughout the country under the protection of
the laws of the various States, including Oklahoma, and enhances the value of petitioners'
businesses by facilitating their customers' traveling.

Thus, the Court errs in its conclusion, ante at 444 U. S. 299 (emphasis added), that "petitioners
have no contacts, ties, or relations'" with Oklahoma. There obviously are contacts, and, given
Oklahoma's connection to the litigation, the contacts are sufficiently significant to make it fair and
reasonable for the petitioners to submit to Oklahoma's jurisdiction.

III
It may be that affirmance of the judgments in these cases would approach the outer limits
of International Shoe'sjurisdictional

Page 444 U. S. 308

principle. But that principle, with its almost exclusive focus on the rights of defendants, may be
outdated. As MR. JUSTICE MARSHALL wrote in Shaffer v. Heitner, 433 U.S. at 433 U. S. 212:

"'[T]raditional notions of fair play and substantial justice' can be as readily offended by the
perpetuation of ancient forms that are no longer justified as by the adoption of new
procedures. . . ."

International Shoe inherited its defendant focus from Pennoyer v. Neff, 95 U. S. 714 (1878), and
represented the last major step this Court has taken in the long process of liberalizing the doctrine
of personal jurisdiction. Though its flexible approach represented a major advance, the structure of
our society has changed in many significant ways since International Shoe was decided in 1945. Mr.
Justice Black, writing for the Court in McGee v. International Life Ins. Co., 355 U. S. 220, 355 U. S.
222 (1957), recognized that "a trend is clearly discernible toward expanding the permissible scope
of state jurisdiction over foreign corporations and other nonresidents." He explained the trend as
follows:

"In part, this is attributable to the fundamental transformation of our national economy over the
years. Today, many commercial transactions touch two or more States, and may involve parties
separated by the full continent. With this increasing nationalization of commerce has come a great
increase in the amount of business conducted by mail across state lines. At the same time, modern
transportation and communication have made it much less burdensome for a party sued to defend
himself in a State where he engages in economic activity."

Id. at 355 U. S. 222-223. As the Court acknowledges, ante at 444 U. S. 292-293, both the
nationalization of commerce and the ease of transportation and communication have accelerated
in the generation since 1957. [Footnote 2/13]

Page 444 U. S. 309

The model of society on which the International Shoe Court based its opinion is no longer accurate.
Business people, no matter how local their businesses, cannot assume that goods remain in the
business' locality. Customers and goods can be anywhere else in the country, usually in a matter of
hours and always in a matter of a very few days.

In answering the question whether or not it is fair and reasonable to allow a particular forum to
hold a trial binding on a particular defendant, the interests of the forum State and other parties
loom large in today's world, and surely are entitled to as much weight as are the interests of the
defendant. The "orderly administration of the laws" provides a firm basis for according some
protection to the interests of plaintiffs and States as well as of defendants. [Footnote 2/14]
Certainly, I cannot see how a defendant's right to due process is violated if the defendant suffers no
inconvenience. See ante at 444 U. S. 294.
The conclusion I draw is that constitutional concepts of fairness no longer require the extreme
concern for defendants that was once necessary. Rather, as I wrote in dissent from Shaffer v.
Heitner, supra, at 433 U. S. 220 (emphasis added), minimum

Page 444 U. S. 310

contacts must exist "among the parties, the contested transaction, and the forum State." [Footnote
2/15] The contacts between any two of these should not be determinative.

"[W]hen a suitor seeks to lodge a suit in a State with a substantial interest in seeing its own law
applied to the transaction in question, we could wisely act to minimize conflicts, confusion, and
uncertainty by adopting a liberal view of jurisdiction, unless considerations of fairness or efficiency
strongly point in the opposite direction. [Footnote 2/16]"

433 U.S. at 433 U. S. 225-226. Mr. Justice Black, dissenting in Hanson v. Denckla, 357 U.S. at 357 U.
S. 258-250, expressed similar concerns by suggesting that a State should have jurisdiction over a
case growing out of a transaction significantly related to that State

"unless litigation there would impose such a heavy and disproportionate burden on a nonresident
defendant that it would offend what this Court has referred to as 'traditional notions of fair play and
substantial justice.' [Footnote 2/17]"

Assuming

Page 444 U. S. 311

that a State gives a nonresident defendant adequate notice and opportunity to defend, I do not
think the Due Process Clause is offended merely because the defendant has to board a plane to get
to the site of the trial.

The Court's opinion in No. 78-1078 suggests that the defendant ought to be subject to a State's
jurisdiction only if he has contacts with the State "such that he should reasonably anticipate being
haled into court there." [Footnote 2/18] Ante at444 U. S. 297. There is nothing unreasonable or
unfair, however, about recognizing commercial reality. Given the tremendous mobility of goods and
people, and the inability of businessmen to control where goods are taken by customers (or
retailers), I do not think that the defendant should be in complete control of the geographical
stretch of his amenability to suit. Jurisdiction is no longer premised on the notion that nonresident
defendants have somehow impliedly consented to suit. People should understand that they are
held responsible for the consequences of their actions, and that, in our society, most actions have
consequences affecting many States. When an action in fact causes injury in another State, the
actor should be prepared to answer for it there unless defending in that State would be unfair for
some reason other than that a state boundary must be crossed. [Footnote 2/19]

In effect, the Court is allowing defendants to assert the sovereign

Page 444 U. S. 312

rights of their home States. The expressed fear is that, otherwise, all limits on personal jurisdiction
would disappear. But the argument's premise is wrong. I would not abolish limits on jurisdiction or
strip state boundaries of all significance, see Hanson, supra at 357 U. S. 260 (Black, J., dissenting); I
would still require the plaintiff to demonstrate sufficient contacts among the parties, the forum, and
the litigation to make the forum a reasonable State in which to hold the trial. [Footnote 2/20]

I would also, however, strip the defendant of an unjustified veto power over certain very
appropriate fora -- a power the defendant justifiably enjoyed long ago when communication and
travel over long distances were slow and unpredictable and when notions of state sovereignty were
impractical and exaggerated. But I repeat that that is not today's world. If a plaintiff can show that
his chosen forum State has a sufficient interest in the litigation (or sufficient contacts with the
defendant), then the defendant who cannot show some real injury to a constitutionally protected
interest, see O'Connor v. Lee-Hy Paving Corp., 579 F.2d at 201, should have no constitutional
excuse not to appear. [Footnote 2/21]

The plaintiffs in each of these cases brought suit in a forum with which they had significant
contacts and which had significant contacts with the litigation. I am not convinced that the
defendants would suffer any "heavy and disproportionate burden" in defending the suits.
Accordingly, I would hold

Page 444 U. S. 313

that the Constitution should not shield the defendants from appearing and defending in the
plaintiffs' chosen fora.

* [This opinion applies also to No. 7952, Rush et al. v. Savchuk, post, p. 444 U. S. 320]

[Footnote 2/1]

In fact, a courtroom just across the state line from a defendant may often be far more convenient for the
defendant than a courtroom in a distant corner of his own State.

[Footnote 2/2]

The States themselves, of course, remain free to choose whether to extend their jurisdiction to embrace all
defendants over whom the Constitution would permit exercise of jurisdiction.

[Footnote 2/3]

The plaintiff asserted jurisdiction pursuant to Minn.Stat. 571.41, subd. 2 (1978), which allows garnishment
of an insurer's obligation to defend and indemnify its insured. See post at 444 U. S. 322-323, n. 3, and
accompanying text. The Minnesota Supreme Court has interpreted the statute as allowing suit only to the
insurance policy's liability limit. The court has held that the statute embodies the rule of Seider v. Roth, 17
N.Y.2d 111, 216 N.E.2d 312 (1966).

[Footnote 2/4]

To say that these considerations are relevant is a far cry from saying that they are "substituted for . . .
contacts with the defendant and the cause of action." Post at 444 U. S. 332. The forum's interest in the
litigation is an independent point of inquiry even under traditional readings of International Shoe's progeny. If
there is a shift in focus, it is not away from "the relationship among the defendant, the forum, and the
litigation." Post at 444 U. S. 332 (emphasis added). Instead, it is a shift within the same accepted relationship
from the connections between the defendant and the forum to those between the forum and the litigation.
[Footnote 2/5]

In every International Shoe inquiry, the defendant, necessarily, is outside the forum State. Thus, it is
inevitable that either the defendant or the plaintiff will be inconvenienced. The problem existing at the time
of Pennoyer v. Neff, 95 U. S. 714(1878), that a resident plaintiff could obtain a binding judgment against an
unsuspecting, distant defendant, has virtually disappeared in this age of instant communication and virtually
instant travel.

[Footnote 2/6]

It is true that the insurance contract is not the subject of the litigation. Post at 444 U. S. 329. But one of the
undisputed clauses of the insurance policy is that the insurer will defend this action and pay any damages
assessed, up to the policy limit. The very purpose of the contract is to relieve the insured from having to
defend himself, and, under the state statute, there could be no suit absent the insurance contract. Thus, in a
real sense, the insurance contract is the source of the suit. See Shaffer v. Heitner, 433 U. S. 186, 433 U. S.
207 (1977).

[Footnote 2/7]

Were the defendant a real party subject to actual liability, or were there significant noneconomic
consequences such as those suggested by the Court's note 20, post at 444 U. S. 331, a more substantial
connection with the forum State might well be constitutionally required.

[Footnote 2/8]

On the basis of this fact, the state court inferred that the petitioners derived substantial revenue from goods
used in Oklahoma. The inference is not without support. Certainly, were use of goods accepted as a relevant
contact, a plaintiff would not need to have an exact count of the number of petitioners' cars that are used in
Oklahoma.

[Footnote 2/9]

Moreover, imposing liability in this case would not so undermine certainty as to destroy an automobile
dealer's ability to do business. According jurisdiction does not expand liability except in the marginal case
where a plaintiff cannot afford to bring an action except in the plaintiff's own State. In addition, these
petitioners are represented by insurance companies. They not only could, but did, purchase insurance to
protect them should they stand trial and lose the case. The costs of the insurance no doubt are passed on to
customers.

[Footnote 2/10]

One might argue that it was more predictable that the pollutants would reach Ohio than that one of
petitioners' cars would reach Oklahoma. The Court's analysis, however, excludes jurisdiction in a contiguous
State such as Pennsylvania as surely as in more distant States such as Oklahoma.

[Footnote 2/11]

For example, I cannot understand the constitutional distinction between selling an item in New Jersey and
selling an item in New York expecting it to be used in New Jersey.

[Footnote 2/12]
The manufacturer in the case cited by the Court, Gray v. American Radiator & Standard Sanitary Corp., 22
Ill.2d 432, 176 N.E.2d 761 (1961), had no more control over which States its goods would reach than did the
petitioners in this case.

[Footnote 2/13]

Statistics help illustrate the amazing expansion in mobility since International Shoe. The number of revenue
passenger-miles flown on domestic and international flights increased by nearly three orders of magnitude
between 1945 (450 million) and 1976 (179 billion). U.S. Department of Commerce, Historical Statistics of the
United States, pt. 2, P. 770 (1975); U.S. Department of Commerce, Statistical Abstract of the United States
670 (1978). Automobile vehicle-miles (including passenger cars, buses, and trucks) driven in the United
States increased by a relatively modest 500% during the same period, growing from 250 billion in 1945 to
1,409 billion in 1976. Historical Statistics, supra at 718; Statistical Abstract, supra at 647.

[Footnote 2/14]

The Court has recognized that there are cases where the interests of justice can turn the focus of the
jurisdictional inquiry away from the contacts between a defendant and the forum State. For instance, the
Court indicated that the requirement of contacts may be greatly relaxed (if indeed any personal contacts
would be required) where a plaintiff is suing a nonresident defendant to enforce a judgment procured in
another State. Shaffer v. Heitner, 433 U.S. at 433 U. S. 210-211, nn. 36, 37.

[Footnote 2/15]

In some cases, the inquiry will resemble the inquiry commonly undertaken in determining which State's law
to apply. That it is fair to apply a State's law to a nonresident defendant is clearly relevant in determining
whether it is fair to subject the defendant to jurisdiction in that State. Shaffer v. Heitner, supra at 433 U. S.
225 (BRENNAN, J., dissenting); Hanson v. Denckla,357 U. S. 235, 357 U. S. 258 (1958) (Black, J.,
dissenting). See n.19, infra.

[Footnote 2/16]

Such a standard need be no more uncertain than the Court's test

"in which few answers will be written 'in black and white. The greys are dominant and even among them the
shades are innumerable.' Estin v. Estin, 334 U. S. 541, 334 U. S. 545 (1948)."

Kulko v. California Superior Court, 436 U. S. 84, 436 U. S. 92 (1978).

[Footnote 2/17]

This strong emphasis on the State's interest is nothing new. This Court, permitting the forum to exercise
jurisdiction over nonresident claimants to a trust largely on the basis of the forum's interest in closing the
trust, stated:

"[T]he interest of each state in providing means to close trusts that exist by the grace of its laws and are
administered under the supervision of its courts is so insistent and rooted in custom as to establish beyond
doubt the right of its courts to determine the interests of all claimants, resident or nonresident, provided its
procedure accords full opportunity to appear and be heard."

Mullane v. Central Hanover Trust Co., 339 U. S. 306, 339 U. S. 313(1950).

[Footnote 2/18]

The Court suggests that this is the critical foreseeability rather than the likelihood that the product
will go to the forum State. But the reasoning begs the question. A defendant cannot know if his
actions will subject him to jurisdiction in another State until we have declared what the law of
jurisdiction is.

[Footnote 2/19]

One consideration that might create some unfairness would be if the choice of forum also imposed
on the defendant an unfavorable substantive law which the defendant could justly have assumed
would not apply. See n. 15, supra.

[Footnote 2/20]

For instance, in No. 78-952, if the plaintiff were not a bona fide resident of Minnesota when the suit
was filed or if the defendant were subject to financial liability, I might well reach a different result.
In No. 78-1078, I might reach a different result if the accident had not occurred in Oklahoma.

[Footnote 2/21]

Frequently, of course, the defendant will be able to influence the choice of forum through
traditional doctrines, such as venue or forum non conveniens, permitting the transfer of
litigation. Shaffer v. Heitner, 433 U.S. at 433 U. S. 228, n. 8 (BRENNAN, J., dissenting).

MR. JUSTICE MARSHALL, with whom MR. JUSTICE BLACKMUN joins, dissenting.

For over 30 years, the standard by which to measure the constitutionally permissible reach of state
court jurisdiction has been well established:

"[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he
be not present within the territory of the forum, he have certain minimum contacts with it such that
the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'"

International Shoe Co. v. Washington, 326 U. S. 310, 326 U. S. 316 (1945), quoting Milliken v.
Meyer, 311 U. S. 457, 311 U. S. 463 (1940).

The corollary, that the Due Process Clause forbids the assertion of jurisdiction over a defendant
"with which the state has no contacts, ties, or relations," 326 U.S. at 326 U. S. 319, is equally clear.
The concepts of fairness and substantial justice as applied to an evaluation of "the quality and
nature of the [defendant's] activity," ibid., are not readily susceptible of further definition, however,
and it is not surprising that the constitutional standard is easier to state than to apply.

This is a difficult case, and reasonable minds may differ as to whether respondents have alleged a
sufficient "relationship among the defendant[s], the forum, and the litigation," Shaffer v.
Heitner, 433 U. S. 186, 433 U. S. 204 (1977), to satisfy the requirements of International Shoe. I am
concerned, however, that the majority has reached its result by taking an unnecessarily narrow
view of petitioners' forum-related conduct. The majority asserts that
"respondents seek to base jurisdiction on one, isolated occurrence and whatever inferences can be
drawn therefrom: the fortuitous circumstance that a single Audi automobile, sold in New York to
New York

Page 444 U. S. 314

residents, happened to suffer an accident while passing through Oklahoma."

Ante at 444 U. S. 295. If that were the case, I would readily agree that the minimum contacts
necessary to sustain jurisdiction are not present. But the basis for the assertion of jurisdiction is not
the happenstance that an individual over whom petitioners had no control made a unilateral
decision to take a chattel with him to a distant State. Rather, jurisdiction is premised on the
deliberate and purposeful actions of the defendants themselves in choosing to become part of a
nationwide, indeed a global, network for marketing and servicing automobiles.

Petitioners are sellers of a product whose utility derives from its mobility. The unique importance of
the automobile in today's society, which is discussed in MR. JUSTICE BLACKMUN's dissenting
opinion, post at 444 U. S. 318, needs no further elaboration. Petitioners know that their customers
buy cars not only to make short trips, but also to travel long distances. In fact, the nationwide
service network with which they are affiliated was designed to facilitate and encourage such travel.
Seaway would be unlikely to sell many cars if authorized service were available only in Massena,
N.Y. Moreover, local dealers normally derive a substantial portion of their revenues from their
service operations, and thereby obtain a further economic benefit from the opportunity to service
cars which were sold in other States. It is apparent that petitioners have not attempted to minimize
the chance that their activities will have effects in other States; on the contrary, they have chosen
to do business in a way that increases that chance, because it is to their economic advantage to do
so.

To be sure, petitioners could not know in advance that this particular automobile would be driven to
Oklahoma. They must have anticipated, however, that a substantial portion of the cars they sold
would travel out of New York. Seaway, a local dealer in the second most populous State, and World-
Wide,

Page 444 U. S. 315

one of only seven regional Audi distributors in the entire country, see Brief for Respondents 2,
would scarcely have been surprised to learn that a car sold by then had been driven in Oklahoma
on Interstate 44, a heavily traveled transcontinental highway. In the case of the distributor, in
particular, the probability that some of the cars it sells will be driven in every one of the contiguous
States must amount to a virtual certainty. This knowledge should alert a reasonable businessman
to the likelihood that a defect in the product might manifest itself in the forum State -- not because
of some unpredictable, aberrant, unilateral action by a single buyer, but in the normal course of the
operation of the vehicles for their intended purpose.

It is misleading for the majority to characterize the argument in favor of jurisdiction as one of
"foreseeability' alone." Ante at444 U. S. 295. As economic entities, petitioners reach out from New
York, knowingly causing effects in other States and receiving economic advantage both from the
ability to cause such effects themselves and from the activities of dealers and distributors in other
States. While they did not receive revenue from making direct sales in Oklahoma, they
intentionally became part of an interstate economic network, which included dealerships in
Oklahoma, for pecuniary gain. In light of this purposeful conduct, I do not believe it can be said that
petitioners "had no reason to expect to be haled before a[n Oklahoma] court." Shaffer v. Heitner,
supra at 433 U. S. 216; see ante at 444 U. S. 297, and Kulko v. California Superior Court, 436 U. S.
84, 436 U. S. 97-98 (1978).

The majority apparently acknowledges that, if a product is purchased in the forum State by a
consumer, that State may assert jurisdiction over everyone in the chain of distribution. See
ante at 444 U. S. 297-298. With this I agree. But I cannot agree that jurisdiction is necessarily
lacking if the product enters the State not through the channels of distribution but in the course of
its intended use by the consumer. We have recognized

Page 444 U. S. 316

the role played by the automobile in the expansion of our notions of personal jurisdiction. See
Shaffer v. Heitner, supra at433 U. S. 204; Hess v. Pawloski, 274 U. S. 352 (1927). Unlike most other
chattels, which may find their way into States far from where they were purchased because their
owner takes them there, the intended use of the automobile is precisely as a means of traveling
from one place to another. In such a case, it is highly artificial to restrict the concept of the "stream
of commerce" to the chain of distribution from the manufacturer to the ultimate consumer.

I sympathize with the majority's concern that persons ought to be able to structure their conduct so
as not to be subject to suit in distant forums. But that may not always be possible. Some activities,
by their very nature, may foreclose the option of conducting them in such a way as to avoid
subjecting oneself to jurisdiction in multiple forums. This is by no means to say that all sellers of
automobiles should be subject to suit everywhere; but a distributor of automobiles to a multistate
market and a local automobile dealer who makes himself part of a nationwide network of
dealerships can fairly expect that the cars they sell may cause injury in distant States and that they
may be called on to defend a resulting lawsuit there.

In light of the quality and nature of petitioners' activity, the majority's reliance on Kulko v.
California Superior Court, supra, is misplaced. Kulko involved the assertion of state court
jurisdiction over a nonresident individual in connection with an action to modify his child custody
rights and support obligations. His only contact with the forum State was that he gave his minor
child permission to live there with her mother. In holding that the exercise of jurisdiction violated
the Due Process Clause, we emphasized that the cause of action, as well as the defendant's actions
in relation to the forum State, arose "not from the defendant's commercial transactions in
interstate commerce, but rather from his personal,

Page 444 U. S. 317

domestic relations," 436 U.S. at 436 U. S. 97 (emphasis supplied), contrasting Kulko's actions with
those of the insurance company in McGee v. International Life Ins. Co., 355 U. S. 220 (1957), which
were undertaken for commercial benefit.*

Manifestly, the "quality and nature" of commercial activity is different, for purposes of
the International Shoe test, from actions from which a defendant obtains no economic advantage.
Commercial activity is more likely to cause effects in a larger sphere, and the actor derives an
economic benefit from the activity that makes it fair to require him to answer for his conduct where
its effects are felt. The profits may be used to pay the costs of suit, and, knowing that the activity is
likely to have effects in other States, the defendant can readily insure against the costs of those
effects, thereby sparing himself much of the inconvenience of defending in a distant forum.

Of course, the Constitution forbids the exercise of jurisdiction if the defendant had no judicially
cognizable contacts with the forum. But as the majority acknowledges, if such contacts are present,
the jurisdictional inquiry requires a balancing of various interests and policies. See ante at 444 U. S.
292; Rush v. Savchuk, post at 444 U. S. 332. I believe such contacts are to be found here, and that,
considering all of the interests and policies at stake, requiring petitioners to defend this action in
Oklahoma is not beyond the bounds of the Constitution. Accordingly, I dissent.

* Similarly, I believe the Court in Hanson v. Denckla, 357 U. S. 235 (1958), was influenced by the
fact that trust administration has traditionally been considered a peculiarly local activity.

MR JUSTICE BLACKMUN, dissenting.

I confess that I am somewhat puzzled why the plaintiffs in this litigation are so insistent that the
regional distributor and the retail dealer, the petitioners here, who handled the ill-fated Audi
automobile involved in this litigation, be named defendants. It would appear that the manufacturer
and the

Page 444 U. S. 318

importer, whose subjectability to Oklahoma jurisdiction is not challenged before this Court, ought
not to be judgment-proof. It may, of course, ultimately amount to a contest between insurance
companies that, once begun, is not easily brought to a termination. Having made this much of an
observation, I pursue it no further.

For me, a critical factor in the disposition of the litigation is the nature of the instrumentality under
consideration. It has been said that we are a nation on wheels. What we are concerned with here is
the automobile and its peripatetic character. One need only examine our national network of
interstate highways, or make an appearance on one of them, or observe the variety of license
plates present not only on those highways but in any metropolitan area, to realize that any
automobile is likely to wander far from its place of licensure or from its place of distribution and
retail sale. Miles per gallon on the highway (as well as in the city) and mileage per tankful are
familiar allegations in manufacturers' advertisements today. To expect that any new automobile will
remain in the vicinity of its retail sale -- like the 1914 electric car driven by the proverbial "little old
lady" -- is to blink at reality. The automobile is intended for distance, as well as for transportation
within a limited area.

It therefore seems to me not unreasonable -- and certainly not unconstitutional and beyond the
reach of the principles laid down in International Shoe Co. v. Washington, 326 U. S. 310 (1945), and
its progeny -- to uphold Oklahoma jurisdiction over this New York distributor and this New York
dealer when the accident happened in Oklahoma. I see nothing more unfair for them than for the
manufacturer and the importer. All are in the business of providing vehicles that spread out over
the highways of our several States. It is not too much to anticipate, at the time of distribution and
at the time of retail sale, that this Audi would be in Oklahoma. Moreover, in assessing "minimum
contacts," foreseeable use in another State seems to me to be little different from foreseeable
resale
Page 444 U. S. 319

in another State: yet the Court declares this distinction determinative. Ante at 444 U. S. 297-299.

MR. JUSTICE BRENNAN points out in his dissent, ante at 444 U. S. 307, that an automobile dealer
derives substantial benefits from States other than its own. The same is true of the regional
distributor. Oklahoma does its best to provide safe roads. Its police investigate accidents. It
regulates driving within the State. It provides aid to the victim, and thereby, it is hoped, lessens
damages. Accident reports are prepared and made available. All this contributes to and enhances
the business of those engaged professionally in the distribution and sale of automobiles. All this
also may benefit defendants in the very lawsuits over which the State asserts jurisdiction.

My position need not now take me beyond the automobile and the professional who does business
by way of distributing and retailing automobiles. Cases concerning other instrumentalities will be
dealt with as they arise, and in their own contexts.

I would affirm the judgment of the Supreme Court of Oklahoma. Because the Court reverses that
judgment, it will now be about parsing every variant in the myriad of motor vehicle fact situations
that present themselves. Some will justify jurisdiction and others will not. All will depend on the
"contact" that the Court sees fit to perceive in the individual case.

Syllabus

A products liability action was instituted in an Oklahoma st,ate court by respondents husband and
wife to recover for personal injuries sustained in Oklahoma in an accident involving an automobile
that had been purchased by them in New York while they were New York residents and that was
being driven through Oklahoma at the time of the accident. The defendants included the
automobile retailer and its wholesaler (petitioners), New York corporations that did no business in
Oklahoma. Petitioners entered special appearances, claiming that Oklahoma's exercise of
jurisdiction over them would offend limitations on the State's jurisdiction imposed by the Due
Process Clause of the Fourteenth Amendment. The trial court rejected petitioners' claims, and they
then sought, but were denied, a writ of prohibition in the Oklahoma Supreme Court to restrain
respondent trial judge from exercising in personam jurisdiction over them.

Held: Consistently with the Due Process Clause, the Oklahoma trial court may not exercise in
personam jurisdiction over petitioners. Pp. 444 U. S. 291-299.

(a) A state court may exercise personal jurisdiction over a nonresident defendant only so long as
there exist "minimum contacts" between the defendant and the forum State. International Shoe
Co. v. Washington, 326 U. S. 310. The defendant's contacts with the forum State must be such that
maintenance of the suit does not offend traditional notions of fair play and substantial
justice, id. at 326 U. S. 316, and the relationship between the defendant and the forum must be
such that it is "reasonable . . . to require the corporation to defend the particular suit which is
brought there," id. at 326 U. S. 317. The Due Process Clause

"does not contemplate that a state may make binding a judgment in personam against an
individual or corporate defendant with which the state has no contacts, ties, or relations."

Id. at 326 U. S. 319. Pp. 444 U. S. 291-294.

(b) Here, there is a total absence in the record of those affiliating circumstances that are a
necessary predicate to any exercise of state court jurisdiction. Petitioners carry on no activity
whatsoever in Oklahoma; they close no sales and perform no services there, avail

Page 444 U. S. 287

themselves of none of the benefits of Oklahoma law, and solicit no business there either through
salespersons or through advertising reasonably calculated to reach that State. Nor does the record
show that they regularly sell cars to Oklahoma residents, or that they indirectly, through others,
serve or seek to serve the Oklahoma market. Although it is foreseeable that automobiles sold by
petitioners would travel to Oklahoma and that the automobile here might cause injury in
Oklahoma, "foreseeability" alone is not a sufficient benchmark for personal jurisdiction under the
Due Process Clause. The foreseeability that is critical to due process analysis is not the mere
likelihood that a product will find its way into the forum State, but rather is that the defendant's
conduct and connection with the forum are such that he should reasonably anticipate being haled
into court there. Nor can jurisdiction be supported on the theory that petitioners earn substantial
revenue from goods used in Oklahoma. Pp. 444 U. S. 295-299.

585 P.2d 351, reversed.

WHITE, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, POWELL,
REHNQUIST, and STEVENS, JJ., joined. BRENNAN, J., filed a dissenting opinion, post, p. 444 U. S.
299. MARSHALL, J., filed a dissenting opinion, in which BLACKMUN, J., joined, post, p. 444 U. S. 313.
BLACKMUN, J., filed a dissenting opinion, post, p. 444 U. S. 317.

Brief Fact Summary. A family that purchased a car in New York sued the auto manufacturer and
retailer after they became involved in an accident in Oklahoma while driving to Arizona.
Synopsis of Rule of Law. A consumers unilateral act of brining the defendants product into the
forum state is not a sufficient basis for exercising personal jurisdiction over the defendant.

Facts. Harry and Kay Robinson purchased an Audi automobile from Seaway Volkswagen, Inc. in
New York State in 1976. The following year they left New York to move to Arizona. While they were
driving through Oklahoma, another car struck them, causing a fire which burned Kay Robinson and
two of her children. The Robinsons brought a products liability suit in Oklahoma claiming that their
injuries resulted from defective design and placement for the Audis gas tank and fuel system. The
Robinsons joined as defendants the auto manufacturer, Audi, its importer, Volkswagen of America,
Inc., its regional distributor, World Wide Volkswagen Corporation, and its retail dealer, Seaway. The
court found that World Wide was incorporated and had its business office in New York. It distributed
Vehicles, under Contract with Volkswagen, to retail dealers in New York, Connecticut, and New
Jersey. Seaway is a retail dealer whose place of business is in New York. There was no evidence that
either World-Wide or Seaway did any business in Oklahoma, shipped or sold any products in that
state, had an agent to receive process there, or advertised in Oklahoma. Seaway and World-Wide
made special apperances for the purpose of opposing jurisdiction in Oklahoma. The Oklahoma
court denied their motion and this appeal followed, whereby the Supreme Court of the United
States granted Seaway and World-Wide a writ of certiorari.

Issue. Whether an Oklahoma court may exercise in personam jurisdiction over a non- resident
automobile retailer and its wholesale distributor in a products liability suit, when the defendants
only connection with Oklahoma is the fact that an auto sold in New York to New York residents
became involved in an accident in Oklahoma?

Held. No. The Supreme Court reversed the Oklahoma courts ruling. Forseeability of being asked to
defend a suit in a particular forum is not a sufficient benchmark for personal jurisdiction under the
Due Process Clause. Instead, it is the defendants conduct and connection with the forum state that
determines whether it is reasonable for a defendant to be haled into court. Because Seaway and
World-Wide had no contacts, ties or relations with the state of Oklahoma, jurisdiction would violate
the Due Process Clause.

Dissent. Justice Brennan dissented. He found that the courts over-reliance on contacts between
the defendant and the state obscures whether being subject to a suit there would actually cause
any inconvenience to the defendant. Additionally, he found that because the interest in having the
suit in Oklahoma was strong, given that the plaintiffs were hospitalized there and key witnesses
resided there, jurisdiction should have been granted. A dissenting opinion by Justice Marshal, joined
by Justice Blackmun, was omitted by the casebook editors.

Discussion. The courts reasoning for not extending jurisdiction is that the two purposes of the
minimum contacts requirement, i.e. protecting defendants against the burden of litigating in a
distant forum and ensuring that State courts do not reach beyond the limits established by the
federal system, would not be served if jurisdiction were granted. Specifically, the court relied on the
fact that Seaway and World-Wide carry on no activity whatsoever in Oklahoma, perform no services
there, and avail themselves of none of the privileges and benefits of Oklahoma law. The court will
look not to whether it was foreseeable to the defendant that he could be sued in a given state, but
whether a suit there is reasonable given the defendants ties and relations with the state.

Asahi Metal Indus. Co., Ltd. v. Superior Ct. of California

No. 85-693

Argued November 5, 1986

Decided February 24, 1987

480 U.S. 102

CERTIORARI TO THE SUPREME COURT OF CALIFORNIA

Syllabus

Petitioner manufactures tire valve assemblies in Japan and sells them to several tire manufacturers,
including Cheng Shin Rubber Industrial Co. (Cheng Shin). The sales to Cheng Shin, which amounted
to at least 100,000 assemblies annually from 1978 to 1982, took place in Taiwan, to which the
assemblies were shipped from Japan. Cheng Shin incorporates the assemblies into its finished tires,
which it sells throughout the world, including the United States, where 20 percent of its sales take
place in California. Affidavits indicated that petitioner was aware that tires incorporating its
assemblies would end up in California, but, on the other hand, that it never contemplated that its
sales to Cheng Shin in Taiwan would subject it to lawsuits in California. Nevertheless, in 1979, a
product liability suit was brought in California Superior Court arising from a motorcycle accident
allegedly caused by defects in a tire manufactured by Cheng Shin, which in turn filed a cross-
complaint seeking indemnification from petitioner. Although the main suit was eventually settled
and dismissed, the Superior Court denied petitioner's motion to quash the summons issued against
it. The State Court of Appeal then ordered that the summons be quashed, but the State Supreme
Court reversed, finding that petitioner's intentional act of placing its assemblies into the stream of
commerce by delivering them to Cheng Shin in Taiwan, coupled with its awareness that some of
them would eventually reach California, were sufficient to support state court jurisdiction under the
Due Process Clause.

Held: The judgment is reversed, and the case is remanded.

39 Cal.3d 35, 702 P.2d 543, reversed and remanded.

JUSTICE O'CONNOR delivered the opinion of the Court as to Parts I and II-B, concluding that the
state court's exercise of personal jurisdiction over petitioner would be unreasonable and unfair, in
violation of the Due Process Clause. Pp. 480 U. S. 113-116.

(a) The burden imposed on petitioner by the exercise of state court jurisdiction would be severe,
since petitioner would be required not only to traverse the distance between Japan and California,
but also to submit

Page 480 U. S. 103

its dispute with Cheng Shin to a foreign judicial system. Such unique burdens should have
significant weight in assessing the reasonableness of extending personal jurisdiction over national
borders. Pp. 480 U. S. 113-114.

(b) The interests of Cheng Shin and the forum State in the exercise of jurisdiction over petitioner
would be slight, and would be insufficient to justify the heavy burdens placed on petitioner. The
only surviving question is whether a Japanese corporation should indemnify a Taiwanese
corporation on the bases of a sale made in Taiwan and a shipment of goods from Japan to Taiwan.
The facts do not demonstrate that it would be more convenient for Cheng Shin to litigate its claim
in California, rather than in Taiwan or Japan, while California's interests are diminished by Cheng
Shin's lack of a California residence and by the fact that the dispute is primarily about indemnity,
rather than the safety of consumers. While the possibility of being sued in California might create
an additional deterrent to petitioner's manufacture of unsafe assemblies, the same effect would
result from pressures placed on petitioner by Cheng Shin, whose California sales would subject it to
state tort law. Pp. 480 U. S. 114-115.

(c) The procedural and substantive policies of other nations whose interests are affected by the
forum State's assertion of jurisdiction over an alien defendant must be taken into account, and
great care must be exercised when considering personal jurisdiction in the international context.
Although other nations' interests will differ from case to case, those interests, as well as the Federal
Government's interest in its foreign relations policies, will always be best served by a careful
inquiry into the reasonableness of the particular assertion of jurisdiction, and an unwillingness to
find an alien defendant's serious burdens outweighed where, as here, the interests of the plaintiff
and the forum State are minimal. P.480 U. S. 115.

JUSTICE O'CONNOR, joined by THE CHIEF JUSTICE, JUSTICE POWELL, and JUSTICE SCALIA, concluded
in Parts II-A and III that, even assuming, arguendo, that petitioner was aware that some of the
assemblies it sold to Cheng Shin would be incorporated into tires sold in California, the facts do not
establish minimum contacts sufficient to render the State's exercise of personal jurisdiction
consistent with fair play and substantial justice, as required by the Due Process Clause. Since
petitioner does not do business, have an office, agents, employees, or property, or advertise or
solicit business in California, and since it did not create, control, or employ the distribution system
that brought its assemblies to, or design them in anticipation of sales in, California, it did not
engage in any action to purposely avail itself of the California market. The "substantial connection"
between a defendant and the forum State necessary for a finding of minimum contacts must derive
from an action purposely directed toward the forum State, and the mere placement of a product

Page 480 U. S. 104

into the stream of commerce is not such an act, even if done with an awareness that the stream
will sweep the product into the forum State absent additional conduct indicating an intent to serve
the forum state market. Pp. 480 U. S. 108-113, 116.

JUSTICE BRENNAN, joined by JUSTICE WHITE, JUSTICE MARSHALL, and JUSTICE BLACKMUN, agreed
with the Court's conclusion in Part II-B that the exercise of jurisdiction over petitioner would not
comport with "fair play and substantial justice," but disagreed with Part II-A's interpretation of the
stream-of-commerce theory, and with the conclusion that petitioner did not purposely avail itself of
the California market. As long as a defendant is aware that the final product is being marketed in
the forum State, jurisdiction premised on the placement of a product into the stream of commerce
is consistent with the Due Process Clause, and no showing of additional conduct is required. Here,
even though petitioner did not design or control the distribution system that carried its assemblies
into California, its regular and extensive sales to a manufacturer it knew was making regular sales
of the final product in California were sufficient to establish minimum contacts with California.
Pp. 480 U. S. 116-121.

JUSTICE STEVENS, joined by JUSTICE WHITE and JUSTICE BLACKMUN, agreed that the California
Supreme Court's judgment should be reversed for the reasons stated in Part II-B of the Court's
opinion, but did not join Part II-A, for the reasons that (1) the Court's holding that the State's
exercise of jurisdiction over petitioner would be "unreasonable and unfair" alone requires reversal,
and renders any examination of minimum contacts unnecessary; and (2) even assuming that the
"purposeful availment" test should be formulated here, Part II-A misapplies it to the facts of this
case, since, in its dealings with Cheng Shin, petitioner has arguably engaged in a higher quantum
of conduct than the mere placement of a product into the stream of commerce. Pp. 480 U. S. 121-
122.

O'CONNOR, J., announced the judgment of the Court and delivered the opinion for a unanimous
Court with respect to Part I, the opinion of the Court with respect to Part II-B, in which REHNQUIST,
C.J., and BRENNAN, WHITE, MARSHALL, BLACKMUN, POWELL, and STEVENS, JJ., joined, and an
opinion with respect to Parts II-A and III, in which REHNQUIST, C.J., and POWELL and SCALIA, JJ.,
joined. BRENNAN, J., filed an opinion concurring in part and concurring in the judgment, in which
WHITE, MARSHALL, and BLACKMUN, JJ., joined, post, p. 480 U. S. 116. STEVENS, J., filed an opinion
concurring in part and concurring in the judgment, in which WHITE and BLACKMUN, JJ.,
joined, post, p. 480 U. S. 121.

Page 480 U. S. 105

JUSTICE O'CONNOR announced the judgment of the Court and delivered the unanimous opinion of
the Court with respect to Part I, the opinion of the Court with respect to Part II-B, in which THE
CHIEF JUSTICE, JUSTICE BRENNAN, JUSTICE WHITE, JUSTICE MARSHALL, JUSTICE BLACKMUN,
JUSTICE POWELL, and JUSTICE STEVENS join, and an opinion with respect to Parts II-A and III, in
which THE CHIEF JUSTICE, JUSTICE POWELL, and JUSTICE SCALIA join.

This case presents the question whether the mere awareness on the part of a foreign defendant
that the components it manufactured, sold, and delivered outside the United States would reach
the forum State in the stream of commerce constitutes "minimum contacts" between the
defendant and the forum State such that the exercise of jurisdiction "does not offend traditional
notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U. S.
310, 326 U. S. 316 (1945), quoting Milliken v. Meyer, 311 U. S. 457, 311 U. S. 463 (1940).

On September 23, 1978, on Interstate Highway 80 in Solano County, California, Gary Zurcher lost
control of his Honda motorcycle and collided with a tractor. Zurcher was severely injured, and his
passenger and wife, Ruth Ann Moreno, was killed. In September 1979, Zurcher filed a product
liability action in the Superior Court of the State of

Page 480 U. S. 106

California in and for the County of Solano. Zurcher alleged that the 1978 accident was caused by a
sudden loss of air and an explosion in the rear tire of the motorcycle, and alleged that the
motorcycle tire, tube, and sealant were defective. Zurcher's complaint named, inter alia, Cheng
Shin Rubber Industrial Co., Ltd. (Cheng Shin), the Taiwanese manufacturer of the tube. Cheng Shin
in turn filed a cross-complaint seeking indemnification from its codefendants and from petitioner,
Asahi Metal Industry Co., Ltd. (Asahi), the manufacturer of the tube's valve assembly. Zurcher's
claims against Cheng Shin and the other defendants were eventually settled and dismissed, leaving
only Cheng Shin's indemnity action against Asahi.

California's long-arm statute authorizes the exercise of jurisdiction "on any basis not inconsistent
with the Constitution of this state or of the United States." Cal.Civ.Proc.Code Ann. 410.10 (West
1973). Asahi moved to quash Cheng Shin's service of summons, arguing the State could not exert
jurisdiction over it consistent with the Due Process Clause of the Fourteenth Amendment.

In relation to the motion, the following information was submitted by Asahi and Cheng Shin. Asahi
is a Japanese corporation. It manufactures tire valve assemblies in Japan and sells the assemblies
to Cheng Shin, and to several other tire manufacturers, for use as components in finished tire
tubes. Asahi's sales to Cheng Shin took place in Taiwan. The shipments from Asahi to Cheng Shin
were sent from Japan to Taiwan. Cheng Shin bought and incorporated into its tire tubes 150,000
Asahi valve assemblies in 1978; 500,000 in 1979; 500,000 in 1980;100,000 in 1981; and 100,000
in 1982. Sales to Cheng Shin accounted for 1.24 percent of Asahi's income in 1981 and 0.44
percent in 1982. Cheng Shin alleged that approximately 20 percent of its sales in the United States
are in California. Cheng Shin purchases valve assemblies from other suppliers as well, and sells
finished tubes throughout the world.

Page 480 U. S. 107

In 1983, an attorney for Cheng Shin conducted an informal examination of the valve stems of the
tire tubes sold in one cycle store in Solano County. The attorney declared that, of the approximately
115 tire tubes in the store, 97 were purportedly manufactured in Japan or Taiwan, and of those 97,
21 valve stems were marked with the circled letter "A", apparently Asahi's trademark. Of the 21
Asahi valve stems, 12 were incorporated into Cheng Shin tire tubes. The store contained 41 other
Cheng Shin tubes that incorporated the valve assemblies of other manufacturers. Declaration of
Kenneth B. Shepard in Opposition to Motion to Quash Subpoena, App. to Brief for Respondent 5-6.
An affidavit of a manager of Cheng Shin whose duties included the purchasing of component parts
stated:

"In discussions with Asahi regarding the purchase of valve stem assemblies, the fact that my
Company sells tubes throughout the world and specifically the United States has been discussed. I
am informed and believe that Asahi was fully aware that valve stem assemblies sold to my
Company and to others would end up throughout the United States and in California."

39 Cal.3d 35, 48, n. 4, 702 P.2d 543, 549-550, n. 4 (1985). An affidavit of the president of Asahi, on
the other hand, declared that Asahi "has never contemplated that its limited sales of tire valves to
Cheng Shin in Taiwan would subject it to lawsuits in California." Ibid. The record does not include
any contract between Cheng Shin and Asahi. Tr. of Oral Arg. 24.

Primarily on the basis of the above information, the Superior Court denied the motion to quash
summons, stating:

"Asahi obviously does business on an international scale. It is not unreasonable that they defend
claims of defect in their product on an international scale."

Order Denying Motion to Quash Summons, Zurcher v. Dunlop Tire & Rubber Co., No. 76180 (Super.
Ct., Solano County, Cal., Apr. 20, 1983).

The Court of Appeal of the State of California issued a peremptory writ of mandate commanding
the Superior Court to quash service of summons. The court concluded that

"it

Page 480 U. S. 108

would be unreasonable to require Asahi to respond in California solely on the basis of ultimately
realized foreseeability that the product into which its component was embodied would be sold all
over the world, including California."

App. to Pet. for Cert. B5-B6.

The Supreme Court of the State of California reversed and discharged the writ issued by the Court
of Appeal. 39 Cal.3d 35, 702 P.2d 543 (1985). The court observed:
"Asahi has no offices, property or agents in California. It solicits no business in California, and has
made no direct sales [in California]."

Id. at 48, 702 P.2d at 549. Moreover, "Asahi did not design or control the system of distribution that
carried its valve assemblies into California." Id. at 49, 702 P.2d at 549. Nevertheless, the court
found the exercise of jurisdiction over Asahi to be consistent with the Due Process Clause. It
concluded that Asahi knew that some of the valve assemblies sold to Cheng Shin would be
incorporated into tire tubes sold in California, and that Asahi benefited indirectly from the sale in
California of products incorporating its components. The court considered Asahi's intentional act of
placing its components into the stream of commerce -- that is, by delivering the components to
Cheng Shin in Taiwan -- coupled with Asahi's awareness that some of the components would
eventually find their way into California, sufficient to form the basis for state court jurisdiction
under the Due Process Clause.

We granted certiorari, 475 U.S. 1044 (1986), and now reverse.

II

The Due Process Clause of the Fourteenth Amendment limits the power of a state court to exert
personal jurisdiction over a nonresident defendant. "[T]he constitutional touchstone" of the
determination whether an exercise of personal jurisdiction comports with due process "remains
whether the defendant purposefully established minimum contacts' in the

Page 480 U. S. 109

forum State." Burger King Corp. v. Rudzewicz, 471 U. S. 462, 471 U. S. 474 (1985),
quoting International Shoe Co. v. Washington,326 U.S. at 326 U. S. 316. Most recently, we have
reaffirmed the oft-quoted reasoning of Hanson v. Denckla, 357 U. S. 235, 357 U. S. 253 (1958), that
minimum contacts must have a basis in

"some act by which the defendant purposefully avails itself of the privilege of conducting activities
within the forum State, thus invoking the benefits and protections of its laws."

Burger King, 471 U.S. at 471 U. S. 475.

"Jurisdiction is proper . . . where the contacts proximately result from actions by the
defendant himself that create a 'substantial connection' with the forum State."

Ibid., quoting McGee v. International Life Insurance Co., 355 U. S. 220, 355 U. S. 223 (1957)
(emphasis in original).

Applying the principle that minimum contacts must be based on an act of the defendant, the Court
in World-Wide Volkswagen Corp. v. Woodson, 444 U. S. 286 (1980), rejected the assertion that a
consumer's unilateral act of bringing the defendant's product into the forum State was a sufficient
constitutional basis for personal jurisdiction over the defendant. It had been argued in World-Wide
Volkswagen that, because an automobile retailer and its wholesale distributor sold a product mobile
by design and purpose, they could foresee being haled into court in the distant States into which
their customers might drive. The Court rejected this concept of foreseeability as an insufficient
basis for jurisdiction under the Due Process Clause. Id. at 444 U. S. 295-296. The Court disclaimed,
however, the idea that "foreseeability is wholly irrelevant" to personal jurisdiction, concluding that

"[t]he forum State does not exceed its powers under the Due Process Clause if it asserts personal
jurisdiction over a corporation that delivers its products into the stream of commerce with the
expectation that they will be purchased by consumers in the forum State."

Id. at 444 U. S. 297-298 (citation omitted). The Court reasoned:

Page 480 U. S. 110

"When a corporation 'purposefully avails itself of the privilege of conducting activities within the
forum State,' Hanson v. Denckla, 357 U.S. [235,] 357 U. S. 253 [(1958)], it has clear notice that it is
subject to suit there, and can act to alleviate the risk of burdensome litigation by procuring
insurance, passing the expected costs on to customers, or, if the risks are too great, severing its
connection with the State. Hence, if the sale of a product of a manufacturer or distributor . . . is not
simply an isolated occurrence, but arises from the efforts of the manufacturer or distributor to
serve, directly or indirectly, the market for its product in other States, it is not unreasonable to
subject it to suit in one of those States if its allegedly defective merchandise has there been the
source of injury to its owners or to others."

Id. at 444 U. S. 297.

In World-Wide Volkswagen itself, the state court sought to base jurisdiction not on any act of the
defendant, but on the foreseeable unilateral actions of the consumer. Since World-Wide
Volkswagen, lower courts have been confronted with cases in which the defendant acted by placing
a product in the stream of commerce, and the stream eventually swept defendant's product into
the forum State, but the defendant did nothing else to purposefully avail itself of the market in the
forum State. Some courts have understood the Due Process Clause, as interpreted in World-Wide
Volkswagen, to allow an exercise of personal jurisdiction to be based on no more than the
defendant's act of placing the product in the stream of commerce. Other courts have understood
the Due Process Clause and the above-quoted language in World-Wide Volkswagen to require the
action of the defendant to be more purposefully directed at the forum State than the mere act of
placing a product in the stream of commerce.

The reasoning of the Supreme Court of California in the present case illustrates the former
interpretation of World-Wide Volkswagen. The Supreme Court of California held that, because the
stream of commerce eventually brought

Page 480 U. S. 111

some valves Asahi sold Cheng Shin into California, Asahi's awareness that its valves would be sold
in California was sufficient to permit California to exercise jurisdiction over Asahi consistent with the
requirements of the Due Process Clause. The Supreme Court of California's position was consistent
with those courts that have held that mere foreseeability or awareness was a constitutionally
sufficient basis for personal jurisdiction if the defendant's product made its way into the forum
State while still in the stream of commerce. See Bean Dredging Corp. v. Dredge Technology
Corp., 744 F.2d 1081 (CA5 1984); Hedrick v. Daiko Shoji Co., 715 F.2d 1355 (CA9 1983).
Other courts, however, have understood the Due Process Clause to require something more than
that the defendant was aware of its product's entry into the forum State through the stream of
commerce in order for the State to exert jurisdiction over the defendant. In the present case, for
example, the State Court of Appeal did not read the Due Process Clause, as interpreted by World-
Wide Volkswagen, to allow

"mere foreseeability that the product will enter the forum state [to] be enough by itself to establish
jurisdiction over the distributor and retailer."

App. to Pet. for Cert. B5. In Humble v. Toyota Motor Co., 727 F.2d 709 (CA8 1984), an injured car
passenger brought suit against Arakawa Auto Body Company, a Japanese corporation that
manufactured car seats for Toyota. Arakawa did no business in the United States; it had no office,
affiliate, subsidiary, or agent in the United States; it manufactured its component parts outside the
United States and delivered them to Toyota Motor Company in Japan. The Court of Appeals,
adopting the reasoning of the District Court in that case, noted that, although it "does not doubt
that Arakawa could have foreseen that its product would find its way into the United States," it
would be "manifestly unjust" to require Arakawa to defend itself in the United States. Id. at 710-
711, quoting 578 F.Supp. 530, 533 (ND Iowa 1982). See also Hutson v. Fehr Bros.,

Page 480 U. S. 112

Inc., 584 F.2d 833 (CA8 1978); see generally Max Daetwyler Corp. v. R. Meyer, 762 F.2d 290, 299
(CA3 1985) (collecting "stream of commerce" cases in which the "manufacturers involved had
made deliberate decisions to market their products in the forum state").

We now find this latter position to be consonant with the requirements of due process. The
"substantial connection," Burger King, 471 U.S. at 471 U. S. 475; McGee, 355 U.S. at 355 U. S. 223,
between the defendant and 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. Burger
King, supra, at 471 U. S. 476; Keeton v. Hustler Magazine, Inc., 465 U. S. 770, 465 U. S. 774 (1984).
The placement of a product into the stream of commerce, without more, is not an act of the
defendant purposefully directed toward the forum State. Additional 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, establishing 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 product into 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 established 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. Asahi does
not do business in California. 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. Cf. Hicks v. Kawasaki Heavy Industries,

Page 480 U. S. 113

452 F.Supp. 130 (MD Pa. 1978). There is no evidence that Asahi designed its product in anticipation
of sales in California.Cf. Rockwell International Corp. v. Costruzioni Aeronautiche Giovanni
Agusta, 553 F.Supp. 328 (ED Pa. 1982). 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 to exercise personal jurisdiction over
Asahi under circumstances that would offend "traditional notions of fair play and substantial
justice.'" International Shoe Co. v. Washington, 326 U.S. at 326 U. S. 316, quoting Milliken v.
Meyer, 311 U.S. at 311 U. S. 463.

We have previously explained that the determination of the reasonableness of the exercise of
jurisdiction in each case will depend on an evaluation of several factors. A court must consider the
burden on the defendant, the interests of the forum State, and the plaintiff's interest in obtaining
relief. It must also weigh in its determination

"the interstate judicial system's interest in obtaining the most efficient resolution of controversies;
and the shared interest of the several States in furthering fundamental substantive social policies."

World-Wide Volkswagen, 444 U.S. at 444 U. S. 292 (citations omitted).

Page 480 U. S. 114

A consideration of these factors in the present case clearly reveals the unreasonableness of the
assertion of jurisdiction over Asahi, even apart from the question of the placement of goods in the
stream of commerce.

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 Superior 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 assessing 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 Tawainese 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 indemnification 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 California argued that the State had an interest in
"protecting its consumers by ensuring that foreign manufacturers comply with the state's safety
standards." 39 Cal.3d at 49, 702 P.2d at 550. The State Supreme Court's definition of California's
interest, however, was overly broad. The dispute between Cheng Shin and Asahi is primarily about
indemnification, rather than safety

Page 480 U. S. 115

standards. 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. Phillips Petroleum Co. v. Shutts, 472
U. S. 797, 472 U. S. 821-822 (1985); Allstate Insurance Co. v. Hague,449 U. S. 302, 449 U. S. 312-
313 (1981). The possibility of being haled into a California court as a result of an accident involving
Asahi's components undoubtedly creates an additional deterrent to the manufacture of unsafe
components; however, similar pressures will be placed on Asahi by the purchasers of its
components as long as those who use Asahi components in their final products, and sell those
products in California, are subject to the application of California tort law.

World-Wide Volkswagen also admonished courts to take into consideration the interests of the
"several States," in addition to the forum State, in the efficient judicial resolution of the dispute and
the advancement of substantive policies. In the present case, this advice calls for a court to
consider the procedural and substantive policies of other nations whose interests are affected by
the assertion of jurisdiction by the California court. The procedural and substantive interests of
other nations in a state court's assertion of jurisdiction over an alien defendant will differ from case
to case. In every case, however, those interests, as well as the Federal Government's interest in its
foreign relations policies, will be best served by a careful inquiry into the reasonableness of the
assertion of jurisdiction in the particular case, and an unwillingness to find the serious burdens on
an alien defendant outweighed by minimal interests on the part of the plaintiff or the forum State.
"Great care and reserve should be exercised when extending our notions of personal jurisdiction
into the international field." United States v. First National City Bank, 379 U. S. 378, 379 U. S.
404 (1965) (Harlan, J., dissenting). SeeBorn, Reflections on Judicial Jurisdiction in International
Cases, to be published in 17 Ga.J.Int'l & Comp.L. 1 (1987).

Page 480 U. S. 116

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.

III

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 the
Supreme Court of California is reversed, and the case is remanded for further proceedings not
inconsistent with this opinion.

It is so ordered.

* We have no occasion here to determine whether Congress could, consistent with the Due Process
Clause of the Fifth Amendment, authorize federal court personal jurisdiction over alien defendants
based on the aggregate of nationalcontacts, rather than on the contacts between the defendant
and the State in which the federal court sits. See Max Daetwyler Corp. v. R. Meyer, 762 F.2d 290,
293-295 (CA3 1985); DeJames v. Magnificence Carriers, Inc., 654 F.2d 280, 283 (CA3 1981); see
also Born, Reflections on Judicial Jurisdiction in International Cases, to be published in 17 Ga. J. Int'l
& Comp. L. 1 (1987); Lilly, Jurisdiction Over Domestic and Alien Defendants, 69 Va.L.Rev. 85, 127-
145 (1983).

JUSTICE BRENNAN, with whom JUSTICE WHITE, JUSTICE MARSHALL, and JUSTICE BLACKMUN join,
concurring in part and concurring in the judgment.

I do not agree with the interpretation in Part II-A of the stream-of-commerce theory, nor with the
conclusion that Asahi did not "purposely avail itself of the California market." Ante at 480 U. S. 112.
I do agree, however, with the Court's conclusion in Part II-B that the exercise of personal jurisdiction
over Asahi in this case would not comport with "fair play and substantial justice," International
Shoe Co. v. Washington, 326 U. S. 310, 326 U. S. 320 (1945). This is one of those rare cases in
which

"minimum requirements inherent in the concept of 'fair play and substantial justice' . . . defeat the
reasonableness of jurisdiction even [though] the defendant has purposefully engaged in forum
activities."

Burger King Corp. v. Rudzewicz, 471 U. S. 462, 471 U. S. 477-478 (1985). I therefore join Parts I and
II-B of the Court's opinion, and write separately to explain my disagreement with Part II-A.

Part II-A states that

"a defendant's awareness that the stream of commerce may or will sweep the product into the
forum State does not convert the mere act of placing the product into the stream into an act
purposefully directed toward

Page 480 U. S. 117

the forum State."

Ante at 480 U. S. 112. Under this view, a plaintiff would be required to show "[a]dditional conduct"
directed toward the forum before finding the exercise of jurisdiction over the defendant to be
consistent with the Due Process Clause. Ibid. I see no need for such a showing, however. The
stream of commerce refers not to unpredictable currents or eddies, but to the regular and
anticipated flow of products from manufacture to distribution to retail sale. As long as a participant
in this process is aware that the final product is being marketed in the forum State, the possibility
of a lawsuit there cannot come as a surprise. Nor will the litigation present a burden for which there
is no corresponding benefit. A defendant who has placed goods in the stream of commerce benefits
economically from the retail sale of the final product in the forum State, and indirectly benefits from
the State's laws that regulate and facilitate commercial activity. These benefits accrue regardless of
whether that participant directly conducts business in the forum State, or engages in additional
conduct directed toward that State. Accordingly, most courts and commentators have found that
jurisdiction premised on the placement of a product into the stream of commerce is consistent with
the Due Process Clause, and have not required a showing of additional conduct. [Footnote 1]

Page 480 U. S. 118

The endorsement in Part II-A of what appears to be the minority view among Federal Courts of
Appeals [Footnote 2] represents a marked retreat from the analysis in World-Wide Volkswagen v.
Woodson, 444 U. S. 286 (1980). In that case,

"respondents [sought] to base jurisdiction on one isolated occurrence and whatever inferences can
be drawn therefrom: the fortuitous circumstance that a single Audi automobile, sold in New York to
New York residents, happened to suffer an accident while passing through Oklahoma."

Id. at 444 U. S. 295. The Court held that the possibility of an accident in Oklahoma, while to some
extent foreseeable in light of the inherent mobility of the automobile, was not enough to establish

Page 480 U. S. 119

minimum contacts between the forum State and the retailer or distributor. Id. at 444 U. S. 295-296.
The Court then carefully explained:

"[T]his is not to say, of course, that foreseeability is wholly irrelevant. But the foreseeability that is
critical to due process analysis is not the mere likelihood that a product will find its way into the
forum State. Rather, it is that the defendant's conduct and connection with the forum State are
such that he should reasonably anticipate being haled into Court there."

Id. at 444 U. S. 297. The Court reasoned that, when a corporation may reasonably anticipate
litigation in a particular forum, it cannot claim that such litigation is unjust or unfair, because it

"can act to alleviate the risk of burdensome litigation by procuring insurance, passing the expected
costs on to consumers, or, if the risks are too great, severing its connection with the State."

Ibid.

To illustrate the point, the Court contrasted the foreseeability of litigation in a State to which a
consumer fortuitously transports a defendant's product (insufficient contacts) with the
foreseeability of litigation in a State where the defendant's product was regularly sold (sufficient
contacts). The Court stated:

"Hence, if the sale of a product of a manufacturer or distributor such as Audi or Volkswagen is not
simply an isolated occurrence, but arises from the efforts of the manufacturer or distributor to
serve, directly or indirectly, the market for its product in other States, it is not unreasonable to
subject it to suit in one of those States if its allegedly defective merchandise has there been the
source of injury to its owner or to others. The forum State does not exceed its powers under the
Due Process Clause if it asserts personal jurisdiction over a corporation that delivers its products
into the stream of commerce with the expectation that they will be purchased

Page 480 U. S. 120

by consumers in the forum State."

Id. at 444 U. S. 297-298 (emphasis added). The Court concluded its illustration by referring to Gray
v. American Radiator & Standard Sanitary Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961), a well known
stream-of-commerce case in which the Illinois Supreme Court applied the theory to assert
jurisdiction over a component parts manufacturer that sold no components directly in Illinois, but
did sell them to a manufacturer who incorporated them into a final product that was sold in Illinois.
444 U.S. at 444 U. S. 297-298.

The Court in World-Wide Volkswagen thus took great care to distinguish

"between a case involving goods which reach a distant State through a chain of distribution and a
case involving goods which reach the same State because a consumer . . . took them there."

Id. at 444 U. S. 306-307 (BRENNAN, J., dissenting). [Footnote 3] The California Supreme Court took
note of this distinction, and correctly concluded that our holding in World-Wide
Volkswagen preserved the stream-of-commerce theory. See App. to Pet. for Cert. C-9, and n. 3, C-
13-C-15; cf. Comment, Federalism, Due Process, and Minimum Contacts: World-Wide Volkswagen
Corp v. Woodson, 80 Colum.L.Rev. 1341, 1359-1361, and nn. 140-146 (1980).

Page 480 U. S. 121

In this case, the facts found by the California Supreme Court support its finding of minimum
contacts. The court found that,

"[a]lthough Asahi did not design or control the system of distribution that carried its valve
assemblies into California, Asahi was aware of the distribution system's operation, and it knew that
it would benefit economically from the sale in California of products incorporating its components."

App. to Pet. for Cert. C-11. [Footnote 4] Accordingly, I cannot join the determination in Part II-A that
Asahi's regular and extensive sales of component parts to a manufacturer it knew was making
regular sales of the final product in California is insufficient to establish minimum contacts with
California.

[Footnote 1]

See, e.g., Bean Dredging Corp. v. Dredge Technology Corp., 744 F.2d 1081 (CA5 1984); Hedrick v.
Daiko Shoji Co., 715 F.2d 1355 (CA9 1983); Nelson v. Park Industries, Inc., 717 F.2d 1120, 1126
(CA7 1983), cert. denied, 465 U.S. 1024 (1984); Stabilisierungsfonds fur Wein v. Kaiser Stuhl Wine
Distributors Pty. Ltd., 207 U.S.App.D.C. 375, 378, 647 F.2d 200, 203 (1981); Poyner v. Erma Werke
Gmbh, 618 F.2d 1186, 1190-1191 (CA6), cert. denied, 449 U.S. 841 (1980); cf. Fidelity & Casualty
Co. of New York v. Philadelphia Resins Corp., 766 F.2d 440 (CA10 1985) (endorsing stream-of-
commerce theory, but finding it inapplicable in instant case), cert. denied, 474 U.S. 1082
(1986); Montalbano v. Easco Hand Tools, Inc., 766 F.2d 737 (CA2 1985) (noting potential
applicability of stream-of-commerce theory, but remanding for further factual findings). See
generally Currie, The Growth of the Long-Arm: Eight Years of Extended Jurisdiction in Illinois, 1963
U.Ill.Law Forum 533, 546-560 (approving and tracing development of the stream-of-commerce
theory); C. Wright & A. Miller, Federal Practice and Procedure 1069, pp. 259-261 (1969)
(recommending in effect a stream-of-commerce approach); Von Mehren & Trautman, Jurisdiction to
Adjudicate: A Suggested Analysis, 79 Harv.L.Rev. 1121, 1168-1172 (1966) (same).

[Footnote 2]
The Court of Appeals for the Eighth Circuit appears to be the only Court of Appeals to have
expressly adopted a narrow construction of the stream-of-commerce theory analogous to the one
articulated in Part II-A today, although the Court of Appeals for the Eleventh Circuit has implicitly
adopted it. See Humble v. Toyota Motor Co., Ltd., 727 F.2d 709 (CA8 1984); Banton Industries, Inc.
v. Dimatic Die & Tool Co., 801 F.2d 1283 (CA11 1986). Two other Courts of Appeals have found the
theory inapplicable when only a single sale occurred in the forum State, but do not appear
committed to the interpretation of the theory that the Court adopts today. E.g., Chung v. NANA
Development Corp., 783 F.2d 1124 (CA4), cert. denied, 479 U.S. 948 (1986); Dalmau Rodriguez v.
Hughes Aircraft Co., 781 F.2d 9 (CA1 1986). Similarly, the Court of Appeals for the Third Circuit has
not interpreted the theory as JUSTICE O'CONNOR's opinion has, but has rejected stream-of-
commerce arguments for jurisdiction when the relationship between the distributor and the
defendant "remains in dispute" and "evidence indicating that [defendant] could anticipate either
use of its product or litigation in [the forum State] is totally lacking," Max Daetwyler Corp. v. R.
Meyer, 762 F.2d 290, 298, 300, n. 13, cert. denied, 474 U.S. 980 (1985), and when the defendant's
product was not sold in the forum State and the defendant "did not take advantage of an indirect
marketing scheme," DeJames v. Magnificence Carriers, Inc., 654 F.2d 280, 285, cert. denied, 454
U.S. 1085 (1981).

[Footnote 3]

In dissent, I argued that the distinction was without constitutional significance, because, in my
view, the foreseeability that a customer would use a product in a distant State was a sufficient
basis for jurisdiction. 444 U.S. at 444 U. S. 306-307, and nn. 11, 12. See also id. at 444 U. S.
315 (MARSHALL, J., dissenting) ("I cannot agree that jurisdiction is necessarily lacking if the product
enters the State not through the channels of distribution, but in the course of its intended use by
the consumer"); id. at 444 U. S. 318-319 (BLACKMUN, J., dissenting) ("[F]oreseeable use in another
State seems to me little different from foreseeable resale in another State"). But I do not read the
decision in World-Wide Volkswagen to establish a per se rule against the exercise of jurisdiction
where the contacts arise from a consumer's use of the product in a given State, but only a rule
against jurisdiction in cases involving "one isolated occurrence [of consumer use, amounting to] . . .
the fortuitous circumstance. . . ." Id. at 444 U. S. 295. See Hedrick v. Daiko Shoji Co., 715 F.2d at
1358-1359.

[Footnote 4]

Moreover, the Court found that "at least 18 percent of the tubes sold in a particular California
motorcycle supply shop contained Asahi valve assemblies," App. to Pet. for Cert. C-11, n. 5, and
that Asahi had an ongoing business relationship with Cheng Shin involving average annual sales of
hundreds of thousands of valve assemblies, id. at C-2.

JUSTICE STEVENS, with whom JUSTICE WHITE and JUSTICE BLACKMUN join, concurring in part and
concurring in the judgment.

The judgment of the Supreme Court of California should be reversed for the reasons stated in Part
II-B of the Court's opinion. While I join Parts I and II-B, I do not join Part II-A for two reasons. First, it
is not necessary to the Court's decision. An examination of minimum contacts is not always
necessary to determine whether a state court's assertion of personal jurisdiction is
constitutional. See Burger King Corp. v. Rudzewicz, 471 U. S. 462, 471 U. S. 476-478 (1985). Part II-
B establishes, after considering the factors set forth in World-Wide Volkswagen Corp. v.
Woodson, 444 U. S. 286, 444 U. S. 292 (1980), that California's exercise of jurisdiction over Asahi in
this case would be "unreasonable and unfair." Ante at 480 U. S. 116. This finding alone requires
reversal; this case fits within the rule that

"minimum requirements inherent in the concept of 'fair play and substantial justice' may defeat

Page 480 U. S. 122

the reasonableness of jurisdiction even if the defendant has purposefully engaged in forum
activities."

Burger King, 471 U.S. at 471 U. S. 477-478 (quoting International Shoe Co. v. Washington, 326 U. S.
310, 326 U. S. 320 (1945)). Accordingly, I see no reason in this case for the plurality to articulate
"purposeful direction" or any other test as the nexus between an act of a defendant and the forum
State that is necessary to establish minimum contacts.

Second, even assuming that the test ought to be formulated here, Part II-A misapplies it to the facts
of this case. The plurality seems to assume that an unwavering line can be drawn between "mere
awareness" that a component will find its way into the forum State and "purposeful availment" of
the forum's market. Ante at 480 U. S. 112. Over the course of its dealings with Cheng Shin, Asahi
has arguably engaged in a higher quantum of conduct than "[t]he placement of a product into the
stream of commerce, without more. . . ." Ibid. Whether or not this conduct rises to the level of
purposeful availment requires a constitutional determination that is affected by the volume, the
value, and the hazardous character of the components. In most circumstances I would be inclined
to conclude that a regular course of dealing that results in deliveries of over 100,000 units annually
over a period of several years would constitute "purposeful availment," even though the item
delivered to the forum State was a standard product marketed throughout the world.

Syllabus

Petitioner manufactures tire valve assemblies in Japan and sells them to several tire manufacturers,
including Cheng Shin Rubber Industrial Co. (Cheng Shin). The sales to Cheng Shin, which amounted
to at least 100,000 assemblies annually from 1978 to 1982, took place in Taiwan, to which the
assemblies were shipped from Japan. Cheng Shin incorporates the assemblies into its finished tires,
which it sells throughout the world, including the United States, where 20 percent of its sales take
place in California. Affidavits indicated that petitioner was aware that tires incorporating its
assemblies would end up in California, but, on the other hand, that it never contemplated that its
sales to Cheng Shin in Taiwan would subject it to lawsuits in California. Nevertheless, in 1979, a
product liability suit was brought in California Superior Court arising from a motorcycle accident
allegedly caused by defects in a tire manufactured by Cheng Shin, which in turn filed a cross-
complaint seeking indemnification from petitioner. Although the main suit was eventually settled
and dismissed, the Superior Court denied petitioner's motion to quash the summons issued against
it. The State Court of Appeal then ordered that the summons be quashed, but the State Supreme
Court reversed, finding that petitioner's intentional act of placing its assemblies into the stream of
commerce by delivering them to Cheng Shin in Taiwan, coupled with its awareness that some of
them would eventually reach California, were sufficient to support state court jurisdiction under the
Due Process Clause.

Held: The judgment is reversed, and the case is remanded.

39 Cal.3d 35, 702 P.2d 543, reversed and remanded.

JUSTICE O'CONNOR delivered the opinion of the Court as to Parts I and II-B, concluding that the
state court's exercise of personal jurisdiction over petitioner would be unreasonable and unfair, in
violation of the Due Process Clause. Pp. 480 U. S. 113-116.

(a) The burden imposed on petitioner by the exercise of state court jurisdiction would be severe,
since petitioner would be required not only to traverse the distance between Japan and California,
but also to submit

Page 480 U. S. 103

its dispute with Cheng Shin to a foreign judicial system. Such unique burdens should have
significant weight in assessing the reasonableness of extending personal jurisdiction over national
borders. Pp. 480 U. S. 113-114.

(b) The interests of Cheng Shin and the forum State in the exercise of jurisdiction over petitioner
would be slight, and would be insufficient to justify the heavy burdens placed on petitioner. The
only surviving question is whether a Japanese corporation should indemnify a Taiwanese
corporation on the bases of a sale made in Taiwan and a shipment of goods from Japan to Taiwan.
The facts do not demonstrate that it would be more convenient for Cheng Shin to litigate its claim
in California, rather than in Taiwan or Japan, while California's interests are diminished by Cheng
Shin's lack of a California residence and by the fact that the dispute is primarily about indemnity,
rather than the safety of consumers. While the possibility of being sued in California might create
an additional deterrent to petitioner's manufacture of unsafe assemblies, the same effect would
result from pressures placed on petitioner by Cheng Shin, whose California sales would subject it to
state tort law. Pp. 480 U. S. 114-115.

(c) The procedural and substantive policies of other nations whose interests are affected by the
forum State's assertion of jurisdiction over an alien defendant must be taken into account, and
great care must be exercised when considering personal jurisdiction in the international context.
Although other nations' interests will differ from case to case, those interests, as well as the Federal
Government's interest in its foreign relations policies, will always be best served by a careful
inquiry into the reasonableness of the particular assertion of jurisdiction, and an unwillingness to
find an alien defendant's serious burdens outweighed where, as here, the interests of the plaintiff
and the forum State are minimal. P.480 U. S. 115.

JUSTICE O'CONNOR, joined by THE CHIEF JUSTICE, JUSTICE POWELL, and JUSTICE SCALIA, concluded
in Parts II-A and III that, even assuming, arguendo, that petitioner was aware that some of the
assemblies it sold to Cheng Shin would be incorporated into tires sold in California, the facts do not
establish minimum contacts sufficient to render the State's exercise of personal jurisdiction
consistent with fair play and substantial justice, as required by the Due Process Clause. Since
petitioner does not do business, have an office, agents, employees, or property, or advertise or
solicit business in California, and since it did not create, control, or employ the distribution system
that brought its assemblies to, or design them in anticipation of sales in, California, it did not
engage in any action to purposely avail itself of the California market. The "substantial connection"
between a defendant and the forum State necessary for a finding of minimum contacts must derive
from an action purposely directed toward the forum State, and the mere placement of a product
Page 480 U. S. 104

into the stream of commerce is not such an act, even if done with an awareness that the stream
will sweep the product into the forum State absent additional conduct indicating an intent to serve
the forum state market. Pp. 480 U. S. 108-113, 116.

JUSTICE BRENNAN, joined by JUSTICE WHITE, JUSTICE MARSHALL, and JUSTICE BLACKMUN, agreed
with the Court's conclusion in Part II-B that the exercise of jurisdiction over petitioner would not
comport with "fair play and substantial justice," but disagreed with Part II-A's interpretation of the
stream-of-commerce theory, and with the conclusion that petitioner did not purposely avail itself of
the California market. As long as a defendant is aware that the final product is being marketed in
the forum State, jurisdiction premised on the placement of a product into the stream of commerce
is consistent with the Due Process Clause, and no showing of additional conduct is required. Here,
even though petitioner did not design or control the distribution system that carried its assemblies
into California, its regular and extensive sales to a manufacturer it knew was making regular sales
of the final product in California were sufficient to establish minimum contacts with California.
Pp. 480 U. S. 116-121.

JUSTICE STEVENS, joined by JUSTICE WHITE and JUSTICE BLACKMUN, agreed that the California
Supreme Court's judgment should be reversed for the reasons stated in Part II-B of the Court's
opinion, but did not join Part II-A, for the reasons that (1) the Court's holding that the State's
exercise of jurisdiction over petitioner would be "unreasonable and unfair" alone requires reversal,
and renders any examination of minimum contacts unnecessary; and (2) even assuming that the
"purposeful availment" test should be formulated here, Part II-A misapplies it to the facts of this
case, since, in its dealings with Cheng Shin, petitioner has arguably engaged in a higher quantum
of conduct than the mere placement of a product into the stream of commerce. Pp. 480 U. S. 121-
122.

O'CONNOR, J., announced the judgment of the Court and delivered the opinion for a unanimous
Court with respect to Part I, the opinion of the Court with respect to Part II-B, in which REHNQUIST,
C.J., and BRENNAN, WHITE, MARSHALL, BLACKMUN, POWELL, and STEVENS, JJ., joined, and an
opinion with respect to Parts II-A and III, in which REHNQUIST, C.J., and POWELL and SCALIA, JJ.,
joined. BRENNAN, J., filed an opinion concurring in part and concurring in the judgment, in which
WHITE, MARSHALL, and BLACKMUN, JJ., joined, post, p. 480 U. S. 116. STEVENS, J., filed an opinion
concurring in part and concurring in the judgment, in which WHITE and BLACKMUN, JJ.,
joined, post, p. 480 U. S. 121.

Brief Fact Summary. A person injured in a motorcycle accident sued the manufacturer of the
motorcycles tire, who then filed a cross-complaint against the manufacturer of one part of the tire.
Synopsis of Rule of Law. The substantial connection between the Defendant and 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.

Facts. Gary Zurcher was severely injured and his wife was killed after he lost control of his Honda
motorcycle and collided with a tractor in Solano County, California. Zurcher filed a products liability
in California state court, alleging that the motorcycle tire, tube and sealant were defective.
Zuchers complaint named Cheng Shin Rubber Industrial, Co., Ltd., the Taiwanese manufacturer of
the tube. Cheng Shin then filed a cross- complaint against Asahi Metal Industry Co., Ltd., the
manufacturer of the tubes valve assembly. Asahi is a Japanese corporation that manufactures tire
valve assemblies in Japan and sells them to Cheng Shin and others for use as components in
finished tire tubes. Approximately 20 percent of Cheng Shins sales in the United States are in
California. A manager of Cheng Shin submitted an affidavit alleging that Asahi was aware that parts
were sold in the U.S. The president of Asahi submitted an affidavit alleging that Asahi never
contemplated that they could be subject to suit in California through its sales of tire valves to
Cheng Shin in Taiwan. Asahi moved to dismiss the suit against it for want of jurisdiction. California
court denied the motion and the Supreme Court of the United States granted a writ of certiorari.

Issue. Whether the mere awareness of the part of a foreign Defendant that the components it
manufactured, sold, and delivered outside the United States would reach the forum state in the
stream of commerce constitutes sufficient minimum contacts rendering jurisdiction appropriate.

Held. No. The Supreme Court of the United States reversed the Supreme Court of Californias
ruling upholding jurisdiction. Due Process requires more than that the Defendant was aware of its
products entry into the forum state through the stream of commerce in order for the state to
exercise jurisdiction over the Defendant. The substantial connection between the Defendant and
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. The placement of a product in the stream
of commerce, without more, is not an act of the Defendant purposefully directed toward the forum
state. Concurrence. Justice Brennan concurred, in which he was joined by Justices White, Marshall,
and Blackmun. Justice Brennan disagreed with the stream of commerce theory, as well as the
courts conclusion that Asahi did not purposely avail itself of the California market. However,
despite finding sufficient minimum contacts, Justice Brennan still found jurisdiction improper
because fair play and substantial justice would not be achieved. Justice Stevens also concurred, in
which he was joined by Justices White and Blackmun. Specifically, he found that minimum contacts
are not always necessary for a state court to invoke jurisdiction.

Discussion. In analyzing whether jurisdiction would offend traditional notions of fair play and
substantial justice, the court noted that the burden on the Defendant to defend the suit would be
severe. Moreover, the court noticed that Californias interest in the suit is slight, since the Plaintiff is
not a California resident.

Rush v. Savchuk

No. 78-952

Argued October 3, 1979

Decided January 21, 1980

444 U.S. 320

APPEAL FROM THE SUPREME COURT OF MINNESOTA

Syllabus

While a resident of Indiana, appellee was injured in an accident in Indiana while riding as a
passenger in a car driven by appellant Rush, also an Indiana resident. After moving to Minnesota,
appellee commenced this action against Rush in a Minnesota state court, alleging negligence and
seeking damages. As Rush had no contacts with Minnesota that would support in
personam jurisdiction, appellee attempted to obtain quasi in rem jurisdiction by garnishing the
contractual obligation of State Farm Mutual Automobile Insurance Co. (State Farm) to defend and
indemnify Rush in connection with such a suit. State Farm, which does business in Minnesota, had
insured the car, owned by Rush's father, under a liability insurance policy issued in Indiana. Rush
was personally served in Indiana, and after State Farm's response to the garnishment summons
asserted that it owed the defendant nothing, appellee moved the trial court for permission to file a
supplemental complaint making the garnishee, State Farm, a party to the action. Rush and State
Farm moved to dismiss the complaint for lack of jurisdiction over the defendant. The trial court
denied the motion to dismiss and granted the motion for leave to file the supplemental complaint.
The Minnesota Supreme Court affirmed, ultimately holding that the assertion of quasi in
rem jurisdiction under the Minnesota garnishment statute complied with the due process standards
enunciated in Shaffer v. Heitner, 433 U. S. 186.

Held: A State may not constitutionally exercise quasi in rem jurisdiction over a defendant who has
no forum contacts by attaching the contractual obligation of an insurer licensed to do business in
the State to defend and indemnify him in connection with the suit. Pp. 444 U. S. 327-333.

(a) A State may exercise jurisdiction over an absent defendant only if the defendant has certain
minimum contacts with the forum such that the maintenance of the suit does not offend traditional
notions of fair play and substantial justice.International Shoe Co. v. Washington, 326 U. S. 310. In
determining whether a particular exercise of state court jurisdiction is consistent with due process,
the inquiry must focus on "the relationship among the defendant, the forum, and the
litigation." Shaffer v. Heitner, supra at 433 U. S. 204. P. 327.

(b) Here, the only affiliating circumstance offered to show a relationship among Rush, Minnesota,
and this lawsuit is that Rush's insurance

Page 444 U. S. 321

company does business in the State. However, the fictional presence in Minnesota of State Farm's
policy obligation to defend and indemnify Rush -- derived from combining the legal fiction that
assigns a situs to a debt, for garnishment purposes, wherever the debtor is found with the legal
fiction that a corporation is "present," for jurisdictional purposes, wherever it does business --
cannot be deemed to give the State the power to determine Rush's liability for the out-of-state
accident. The mere presence of property in a State does not establish a sufficient relationship
between the owner of the property and the State to support the exercise of jurisdiction over an
unrelated cause of action, and it cannot be said that the defendant engaged in any purposeful
activity related to the forum that would make the exercise of jurisdiction fair, just, or reasonable
merely because his insurer does business there. Nor does the policy provide significant contacts
between the litigation and the forum, for the policy obligations pertain only to the conduct, not the
substance, of the litigation. Pp. 444 U. S. 327-330.
(c) Moreover, the requisite minimum contacts with the forum cannot be established under an
alternative approach attributing the insurer's forum contacts to the defendant by treating the
attachment procedure as the functional equivalent of a direct action against the insurer, and
considering the insured a "nominal defendant" in order to obtain jurisdiction over the insurer. The
State's ability to exert its power over the "nominal defendant" is analytically prerequisite to the
insurer's entry into the case as a garnishee, and if the Constitution forbids the assertion of
jurisdiction over the insured based on the policy, then there is no conceptual basis for bringing the
"garnishee" into the action. Nor may the Minnesota court attribute State Farm's contacts to Rush by
considering the "defending parties" together and aggregating their forum contacts in determining
whether it has jurisdiction. The parties' relationships with each other may be significant in
evaluating their ties to the forum, but the requirements of International Shoe must be met as to
each defendant over whom a state court exercises jurisdiction. Pp. 444 U. S. 330-332.

272 N.W.2d 888, reversed.

MARSHALL, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, WHITE,
BLACKMUN, POWELL, and REHNQUIST, JJ., joined. BRENNAN, J., ante p. 444 U. S. 299, and STEVENS,
J., post, p. 444 U. S. 333, filed dissenting opinions.

Page 444 U. S. 322

MR. JUSTICE MARSHALL delivered the opinion of the Court.

This appeal presents the question whether a State may constitutionally exercise quasi in
rem jurisdiction over a defendant who has no forum contacts by attaching the contractual
obligation of an insurer licensed to do business in the State to defend and indemnify him in
connection with the suit.

On January 13, 1972, two Indiana residents were involved in a single-car accident in Elkhart, Ind.
Appellee Savchuk, who was a passenger in the car driven by appellant Rush, was injured. The car,
owned by Rush's father, was insured by appellant State Farm Mutual Automobile Insurance Co.
(State Farm) under a liability insurance policy issued in Indiana. Indiana's guest statute would have
barred a claim by Savchuk. Ind.Code 9-3-3-1 (1976).

Savchuk moved with his parents to Minnesota in June, 1973. [Footnote 1] On May 28, 1974, he
commenced an action against Rush in the Minnesota state courts. [Footnote 2] As Rush had no
contacts with Minnesota that would support in personam jurisdiction, Savchuk attempted to
obtain quasi in rem jurisdiction by garnishing State Farm's obligation under the insurance policy to
defend and indemnify Rush in connection with such a suit. [Footnote 3] State Farm does business in
Minnesota. [Footnote 4] Rush was

Page 444 U. S. 323

personally served in Indiana. The complaint alleged negligence and sought $125,000 in damages.
[Footnote 5]
As provided by the state garnishment statute, Savchuk moved the trial court for permission to file a
supplemental complaint making the garnishee, State Farm, a party to the action after State Farm's
response to the garnishment summons asserted that it owed the defendant nothing. [Footnote 6]
Rush and State

Page 444 U. S. 324

Farm moved to dismiss the complaint for lack of jurisdiction over the defendant. [Footnote 7] The
trial court denied the motion to dismiss and granted the motion for leave to file the supplemental
complaint.

On appeal, the Minnesota Supreme Court affirmed the trial court's decision. 311 Minn. 480, 245
N.W.2d 624 (1976) (Savchuk I). It held, first, that the obligation of an insurance company to defend
and indemnify a nonresident insured under an automobile liability insurance policy is a
garnishable res in Minnesota for the purpose of obtaining quasi in remjurisdiction when the incident
giving rise to the action occurs outside Minnesota but the plaintiff is a Minnesota resident when the
suit is filed. Second, the court held that the assertion of jurisdiction over Rush was constitutional
because he had notice of the suit and an opportunity to defend, his liability was limited to the
amount of the policy, and the garnishment procedure may be used only by Minnesota residents.
The court expressly recognized that Rush had engaged in no voluntary activity that would justify
the exercise of in personam jurisdiction. The court found, however, that considerations of fairness
supported the exercise of quasi in rem jurisdiction because in accident litigation the insurer controls
the defense of the case, State Farm does business in and is regulated by the State, and the State
has an interest in protecting its residents and providing them with a forum in which to litigate their
claims.

Rush appealed to this Court. We vacated the judgment and remanded the cause for further
consideration in light of

Page 444 U. S. 325

Shaffer v. Heitner, 433 U. S. 186 (1977). 433 U.S. 902 (1977).

On remand, the Minnesota Supreme Court held that the assertion of quasi in rem jurisdiction
through garnishment of an insurer's obligation to an insured complied with the due process
standards enunciated in Shaffer. 272 N.W.2d 888 (1978) (Savchuk II). The court found that the
garnishment statute differed from the Delaware stock sequestration procedure held
unconstitutional in Shaffer because the garnished property was intimately related to the litigation
and the garnishment procedure paralleled the asserted state interest in "facilitating recoveries for
resident plaintiffs." 272 N.W.2d at 891. [Footnote 8] This appeal followed.

II

The Minnesota Supreme Court held that the Minnesota garnishment statute embodies the rule
stated in Seider v. Roth, 17 N.Y.2d 111, 216 N.E.2d 312 (1966), that the contractual obligation of an
insurance company to its insured under a liability insurance policy is a debt subject to attachment
under state law if the insurer does business in the State. [Footnote 9]Seider jurisdiction was upheld
against a due process challenge in Simpson v. Loehmann, 21 N.Y.2d 305, 234 N.E.2d 669
(1967), reargument denied, 21 N.Y.2d 990, 238 N.E.2d 319 (1968). The New York court relied
on Harris v. Balk, 198 U. S. 215(1905), in holding that the presence of the debt

Page 444 U. S. 326

in the State was sufficient to permit quasi in rem jurisdiction over the absent defendant. The court
also concluded that the exercise of jurisdiction was permissible under the Due Process Clause
because, "[v]iewed realistically, the insurer in a case such as the present is in full control of the
litigation" and,

"where the plaintiff is a resident of the forum state and the insurer is present in and regulated by it,
the State has a substantial and continuing relation with the controversy."

Simpson v. Loehmann, supra at 311, 234 N.E.2d at 672.

The United States Court of Appeals for the Second Circuit gave its approval to Seider in Minichiello
v. Rosenberg, 410 F.2d 106, adhered to en banc, 410 F.2d 117 (1968), cert. denied, 396 U.S. 844
(1969), although on a slightly different rationale. Judge Friendly construed Seider as,

"in effect, a judicially created direct action statute. The insurer doing business in New York is
considered the real party in interest, and the nonresident insured is viewed simply as a conduit,
who has to be named as a defendant in order to provide a conceptual basis for getting at the
insurer."

410 F.2d at 109; see Donawitz v. Danek, 42 N.Y.2d 138, 142, 366 N.E.2d 253, 255 (1977). The court
held that New York could constitutionally enact a direct action statute, and that the restriction of
liability to the amount of the policy coverage made the policyholder's personal stake in the
litigation so slight that the exercise of jurisdiction did not offend due process.

New York has continued to adhere to Seider. [Footnote 10] New Hampshire has followed Seider if
the defendant resides in a Seider jurisdiction, [Footnote 11] but not in other cases. [Footnote 12]
Minnesota is the only

Page 444 U. S. 327

other State that has adopted Seider-type jurisdiction. [Footnote 13] The Second Circuit recently
reaffirmed its conclusion that Seider does not violate due process after reconsidering the doctrine
in light of Shaffer v. Heitner. O'Conner v. Lee-Hy Paving Corp., 579 F.2d 194, cert. denied, 439 U. S.
1034 (1978).

III

In Shaffer v. Heitner, we held that "all assertions of state court jurisdiction must be evaluated
according to the standards set forth in International Shoe and its progeny." 433 U.S. at 433 U. S.
212. That is, a State may exercise jurisdiction over an absent defendant only if the defendant has

"certain minimum contacts with [the forum] such that the maintenance of the suit does not offend
'traditional notions' of fair play and substantial justice."
International Shoe Co. v. Washington, 326 U. S. 310, 326 U. S. 316 (1945). In determining whether
a particular exercise of state court jurisdiction is consistent with due process, the inquiry must
focus on "the relationship among the defendant, the forum, and the litigation." Shaffer v. Heitner,
supra, at 433 U. S. 204.

It is conceded that Rush has never had any contacts with Minnesota, and that the auto accident
that is the subject of

Page 444 U. S. 328

this action occurred in Indiana and also had no connection to Minnesota. The only affiliating
circumstance offered to show a relationship among Rush, Minnesota, and this lawsuit is that Rush's
insurance company does business in the State. Seider constructed an ingenious jurisdictional
theory to permit a State to command a defendant to appear in its courts on the basis of this factor
alone. State Farm's contractual obligation to defend and indemnify Rush in connection with liability
claims is treated as a debt owed by State Farm to Rush. The legal fiction that assigns a situs to a
debt, for garnishment purposes, wherever the debtor is found is combined with the legal fiction
that a corporation is "present," for jurisdictional purposes, wherever it does business to yield the
conclusion that the obligation to defend and indemnify is located in the forum for purposes of the
garnishment statute. The fictional presence of the policy obligation is deemed to give the State the
power to determine the policyholder's liability for the out-of-state accident. [Footnote 14]

We held in Shaffer that the mere presence of property in a State does not establish a sufficient
relationship between the owner of the property and the State to support the exercise of jurisdiction
over an unrelated cause of action. The ownership of property in the State is a contact between the
defendant and the forum, and it may suggest the presence of other ties. 433 U.S. at 433 U. S. 209.
Jurisdiction is lacking, however, unless there are sufficient contacts to satisfy the fairness standard
of International Shoe.

Here, the fact that the defendant's insurer does business in the forum State suggests no further
contacts between the defendant and the forum, and the record supplies no evidence of any. State
Farm's decision to do business in Minnesota

Page 444 U. S. 329

was completely adventitious as far as Rush was concerned. He had no control over that decision,
and it is unlikely that he would have expected that, by buying insurance in Indiana, he had
subjected himself to suit in any State to which a potential future plaintiff might decide to move. In
short, it cannot be said that the defendant engaged in any purposeful activity related to the forum
that would make the exercise of jurisdiction fair, just, or reasonable, see Kulko v. California Superior
Court, 436 U. S. 84, 436 U. S. 93-94 (1978); Hanson v. Denckla, 357 U. S. 235, 357 U. S.
253 (1958), merely because his insurer does business there.

Nor are there significant contacts between the litigation and the forum. The Minnesota Supreme
Court was of the view that the insurance policy was so important to the litigation that it provided
contacts sufficient to satisfy due process. [Footnote 15] The insurance policy is not the subject
matter of the case, however, nor is it related to the operative facts of the negligence action. The
contractual arrangements between the defendant and the insurer pertain only to the conduct, not
the substance, of the litigation, and accordingly do not affect the court's jurisdiction unless they
demonstrate ties between the defendant and the forum.

In fact, the fictitious presence of the insurer's obligation in Minnesota does not, without more,
provide a basis for concluding that there is any contact in the International Shoe sense

Page 444 U. S. 330

between Minnesota and the insured. To say that "a debt follows the debtor" is simply to say that
intangible property has no actual situs, and a debt may be sued on wherever there is jurisdiction
over the debtor. State Farm is "found," in the sense of doing business, in all 50 States and the
District of Columbia. Under appellee's theory, the "debt" owed to Rush would be "present" in each
of those jurisdictions simultaneously. It is apparent that such a "contact" can have no jurisdictional
significance.

An alternative approach for finding minimum contacts in Seider-type cases, referred to with
approval by the Minnesota Supreme Court, [Footnote 16] is to attribute the insurer's forum contacts
to the defendant by treating the attachment procedure as the functional equivalent of a direct
action against the insurer. This approach views Seider jurisdiction as fair both to the insurer, whose
forum contacts would support in personam jurisdiction even for an unrelated cause of action, and
to the "nominal defendant." Because liability is limited to the policy amount, the defendant incurs
no personal liability, [Footnote 17] and the judgment is satisfied from the policy proceeds which are
not available to the insured for any purpose other than paying accident claims, the insured is said
to have such a slight stake in the litigation as a practical matter that it is not unfair to make him a
"nominal defendant" in order to obtain jurisdiction over the insurance company.

Seider actions are not equivalent to direct actions, however. [Footnote 18] The State's ability to
exert its power over the "nominal

Page 444 U. S. 331

defendant" is analytically prerequisite to the insurer's entry into the case as a garnishee. If the
Constitution forbids the assertion of jurisdiction over the insured based on the policy, then there is
no conceptual basis for bringing the "garnishee" into the action. Because the party with forum
contacts can only be reached through the out-of-state party, the question of jurisdiction over the
nonresident cannot be ignored. [Footnote 19] Moreover, the assumption that the defendant has no
real stake in the litigation is far from self-evident. [Footnote 20]

The Minnesota court also attempted to attribute State Farm's contacts to Rush by considering the
"defending parties" together and aggregating their forum contacts in determining whether it had
jurisdiction. [Footnote 21] The result was the

Page 444 U. S. 332

assertion of jurisdiction over Rush based solely on the activities of State Farm. Such a result is
plainly unconstitutional. Naturally, the parties' relationships with each other may be significant in
evaluating their ties to the forum. The requirements of International Shoe, however, must be met
as to each defendant over whom a state court exercises jurisdiction.
The justifications offered in support of Seider jurisdiction share a common characteristic: they shift
the focus of the inquiry from the relationship among the defendant, the forum, and the litigation to
that among the plaintiff, the forum, the insurer, and the litigation. The insurer's contacts with the
forum are attributed to the defendant because the policy was taken out in anticipation of such
litigation. The State's interests in providing a forum for its residents and in regulating the activities
of insurance companies are substituted for its contacts with the defendant and the cause of action.
This subtle shift in focus from the defendant to the plaintiff is most evident in the decisions
limiting Seider jurisdiction to actions by forum residents on the ground that permitting nonresidents
to avail themselves of the procedure would be unconstitutional. [Footnote 22] In other words, the
plaintiff's contacts with the forum are decisive in determining whether the defendant's due process
rights are violated.

Such an approach is forbidden by International Shoe and its progeny. If a defendant has certain
judicially cognizable ties with a State, a variety of factors relating to the particular cause of action
may be relevant to the determination whether the exercise of jurisdiction would comport with
"traditional notions of fair play and substantial justice." See McGee v. International Life Ins. Co., 355
U. S. 220 (1957); cf. Kulko v. California Superior Court, 436 U.S. at 436 U. S. 98-101. Here, however,
the defendant has no contacts with the forum, and the

Page 444 U. S. 333

Due Process Clause

"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."

International Shoe Co. v. Washington, 326 U.S. at 326 U. S. 319. The judgment of the Minnesota
Supreme Court is, therefore,

Reversed.

[For dissenting opinion of MR. JUSTICE BRENNAN, see ante p. 444 U. S. 299.]

[Footnote 1]

Savchuk moved to Pennsylvania after this appeal was filed.

[Footnote 2]

The suit was filed after the 2-year Indiana statute of limitations had run. 272 N.W.2d 888, 891, n. 5 (1978).

[Footnote 3]

Minnesota Stat. 571.41, subd. 2 (1978), provides in relevant part:

"Notwithstanding anything to the contrary herein contained, a plaintiff in any action in a court of record for
the recovery of money may issue a garnishee summons before judgment therein in the following instances
only:"

"* * * *"
"(b) If the court shall order the issuance of such summons, if a summons and complaint is filed with the
appropriate court and either served on the defendant or delivered to a sheriff for service on the defendant
not more than 30 days after the order is signed, and if, upon application to the court it shall appear that"

"* * * *"

"(2) The purpose of the garnishment is to establish quasi in rem jurisdiction and that"

"* * * *"

"(b) defendant is a nonresident individual, or a foreign corporation, partnership or association."

"(3) The garnishee and the debtor are parties to a contract of suretyship, guarantee, or insurance, because of
which the garnishee may be held to respond to any person for the claim asserted against the debtor in the
main action."

The Minnesota Supreme Court cited this version of the statute, enacted in 1976, in its opinion in 272 N.W.2d
888 (1978) (Savchuk II). The version of the statute that was in effect at the time of the original opinion, 311
Minn. 480, 245 N.W.2d 624 (1976) (Savchuk I), does not differ in any important respect.

[Footnote 4]

State Farm is an Illinois corporation that does business in all 50 States, the District of Columbia, and several
Canadian Provinces. The Insurance Almanac 431-432 (1977).

[Footnote 5]

The prayer was later reduced voluntarily to $50,000, the face amount of the policy.

[Footnote 6]

Minnesota Stat. 571.495 (1978) requires the garnishee to disclose the amount of his debt to the defendant.
Section 571.51 provides in relevant part:

"[I]n all . . . cases where the garnishee denies liability, the judgment creditor may move the court at any time
before the garnishee is discharged, on notice to both the judgment debtor and the garnishee, for leave to file
a supplemental complaint making the latter a party to the action, and setting forth the facts upon which he
claims to charge him; and, if probable cause is shown, such motion shall be granted. . . ."

Minn.Stat. 571.51 (1978). The party-garnishee is not a defendant.

[Footnote 7]

The motion to dismiss also alleged lack of subject matter jurisdiction, insufficiency of process, and
insufficiency of service of process.

[Footnote 8]

Minnesota would apply its own comparative negligence law, rather than Indiana's contributory negligence
rule. See Schwartz v. Consolidated Freightways Corp., 300 Minn. 487, 221 N.W.2d 665 (1974). Appellants
assert that Minnesota would also decline to apply the Indiana guest statute if this case were tried in
Minnesota. Juris.Statement 10, n. 2; cf. Savchuk II, supra at 891-892. The constitutionality of a choice of law
rule that would apply forum law in these circumstances is not before us. Cf. Home Ins. Co. v. Dick, 281 U. S.
397 (1930).

[Footnote 9]

272 N.W.2d at 891.

[Footnote 10]

Baden v. Staples, 45 N.Y.2d 889, 383 N.E.2d 110 (1978). The State has declined, however, to make the
attachment procedure available to nonresident plaintiffs. Donawitz v. Danek, 42 N.Y.2d 138, 366 N.E.2d 253
(1977).

[Footnote 11]

Forbes v. Boynton, 113 N.H. 617, 313 A.2d 129 (1973). But cf. Rocca v. Kenney, 117 N.H. 1057, 381 A.2d 330
(1977).

[Footnote 12]

Camire v. Scieszka, 116 N.H. 281, 358 A.2d 397 (1976).

[Footnote 13]

The practice has been rejected, based on state law or constitutional grounds, in Belcher v. Government
Employees Ins. Co.,282 Md. 718, 387 A.2d 770 (1978); Javorek v. Superior Court, 17 Cal.3d 629, 552 P.2d 728
(1976); Hart v. Cote, 145 N.J.Super. 420, 367 A.2d 1219 (Law Div.1976); Grinnell v. Garrett, 295 So.2d 496
(La.App. 1974); Johnson v. Farmers Alliance Mutual Ins. Co., 499 P.2d 1387 (Okla.1972); State ex rel.
Government Employees Ins. Co. v. Lasky, 454 S.W.2d 942 (Mo.App. 1970); Howard v. Allen, 254 S.C. 455, 176
S.E.2d 127 (1970); De Rentiis v. Lewis, 106 R.I. 240, 258 A.2d 464 (1969); Housley v. Anaconda Co., 19 Utah
2d 124, 427 P.2d 390 (1967); Jardine v. Donnelly, 413 Pa. 474, 198 A.2d 513 (1964). See also Tessier v. State
Farm Mutual Ins. Co., 458 F.2d 1299 (CA1 1972); Kirchman v. Mikula, 443 F.2d 816 (CA5 1971); Robinson v. O.
F. Shearer & Sons, 429 F.2d 83 (CA3 1970); Sykes v. Beal, 392 F.Supp. 1089 (Conn.1975); Ricker v. Lajoie, 314
F.Supp. 401 (Vt.1970).

[Footnote 14]

The conclusion that State Farm's obligation under the insurance policy was garnishable property is a matter
of state law, and therefore is not before us. Assuming that it was garnishable property, the question is what
significance that fact has to the relationship among the defendant, the forum, and the litigation.

[Footnote 15]

The court explained:

"In the instant case, the insurer's obligation to defend and indemnify, while theoretically separable from the
tort action, has no independent value or significance apart from accident litigation. In the accident litigation,
however, it is inevitably the focus, determining the rights and obligation [sic] of the insurer, the insured, and
practically speaking, the victim."
Savchuk II. 272 N.W.2d at 892 (emphasis in original). The court considered the "practical relationship
between the insurer and the nominal defendant," ibid. the limitation of liability to the policy amount, and the
restriction of the garnishment procedure to resident plaintiffs, and concluded that "the relationship between
the defending parties, the litigation, and the forum state," id. at 893, was sufficient to sustain the exercise of
jurisdiction.

[Footnote 16]

Id. at 892-893; but see Savchuk I, 311 Minn. at 488, 245 N.W.2d at 629.

[Footnote 17]

See Savchuk II, 272 N.W.2d at 892; Simpson v. Loehmann, 21 N.Y.2d 990, 991, 238 N.E.2d 319, 320 (1968).

[Footnote 18]

In Savchuk I, the Minnesota Supreme Court rejected Rush's argument that the garnishment procedure
amounted to a direct action, observing: "The defendant, not the insurer, is the party sued. There is nothing in
the statute which suggests that the insurer should be named as a defendant." 311 Minn. at 488, 245 N.W.2d
at 629. See n 6, supra.

[Footnote 19]

Compare the direct action statute upheld in Watson v. Employers Liability Assurance Corp., 348 U. S.
66 (1954), which was applicable only if the accident or injury occurred in the State or the insured was
domiciled there and which permitted the plaintiff to sue the insurer alone, without naming the insured as a
defendant. Id. at 348 U. S. 68, n. 4.

[Footnote 20]

A party does not extinguish his legal interest in a dispute by insuring himself against having to pay an
eventual judgment out of his own pocket. Moreover, the purpose of insurance is simply to make the
defendant whole for the economic costs of the lawsuit; but noneconomic factors may also be important to the
defendant. Professional malpractice actions, for example, question the defendant's integrity and competence,
and may affect his professional standing. Cf. Donawitz v. Danek, 42 N.Y.2d 138, 366 N.E.2d 253 (1977)
(medical malpractice action premised on Seider jurisdiction dismissed because plaintiff was a nonresident).
Further, one can easily conceive of cases in which the defendant might have a substantial economic stake
in Seider litigation -- if, for example, multiple plaintiffs sued in different States for an aggregate amount in
excess of the policy limits, or if a successful claim would affect the policyholder's insurability. For these
reasons, the defendant's interest in the adjudication of his liability cannot reasonably be characterized as de
minimis.

[Footnote 21]

The court stated:

"We view as relevant the relationship between he defending parties, the litigation, and the forum state. It
cannot be said that Minnesota lacks such minimally requisite 'contacts, ties or relations' to those defending
parties as to offend the requirements of due process."

Savchuk II, 272 N.W.2d at 893 (emphasis added).

[Footnote 22]

See, e.g., Farrell v. Piedmont Aviation, Inc., 411 F.2d 812 (CA2 1969); Rintala v. Shoemaker, 362 F.Supp. 1044
(Minn.1973); Donawitz v. Danek, supra; Savchuk I.

MR. JUSTICE STEVENS, J., dissenting.

As the Court notes, appellant Rush had no contact with Minnesota that would support personal jurisdiction
over him in that State. Ante at 444 U. S. 322. Moreover, Shaffer v. Heitner, 433 U. S. 186, precludes the
assertion of quasi in remjurisdiction over his property in that forum if the intangible property attached is
unrelated to the action. It does not follow, however, that the plaintiff may not obtain quasi in rem jurisdiction
over appellant's insurance policy, since his carrier does business in Minnesota and since it has also
specifically contracted in the policy attached to defend the very litigation that plaintiff has instituted in
Minnesota.

In this kind of case, the Minnesota statute authorizing jurisdiction is correctly characterized as the "functional
equivalent" of a so-called direct action statute. The impact of the judgment is against the insurer. * I believe
such a direct action statute is valid as applied to a suit brought by a forum resident, see Watson v. Employers
liability Assurance Corp., 348 U. S. 66, 348 U. S. 72, even if the accident giving rise to the action did not
occur in the forum State, see Minichiello v. Rosenberg,

Page 444 U. S. 334

410 F.2d 106 (CA2 1968), cert. denied, 396 U.S. 844, so long as it is understood that the forum may exercise
no power whatsoever over the individual defendant. As so understood, it makes no difference whether the
insurance company is sued in its own name or, as Minnesota law provides, in the guise of a suit against the
individual defendant.

In this case, although appellant Rush may have a contractual obligation to his insurer to appear in court to
testify and generally to cooperate in the defense of the lawsuit, it is my understanding that Minnesota law
does not compel him to do so through the contempt power or otherwise. Moreover, any judgment formally
entered against the individual defendant may only be executed against the proceeds of his insurance policy.
In my opinion, it would violate the Due Process Clause to make any use of such a judgment against that
individual -- for example, by giving the judgment collateral estoppel effect in a later action against him
arising from the same accident. Accord, Minichiello v. Rosenberg, supra, at 112; Note, The Constitutionality
of Seider v. Roth after Shaffer v. Heitner, 78 Colum.L.Rev. 409, 418-419 (1978). But we are not now faced with
any problem concerning use of a quasi in rem judgment against an individual defendant personally. I am
therefore led to the conclusion that the Federal Constitution does not require the Minnesota courts to dismiss
this action.

* It seems to me that the possible impact of a default judgment on the reputation of an individual, see
ante at 444 U. S. 331, n. 20, who has no contacts whatever with the forum State is far too remote to affect
the analysis of the constitutional issue in this case.

Syllabus

While a resident of Indiana, appellee was injured in an accident in Indiana while riding as a passenger in a car
driven by appellant Rush, also an Indiana resident. After moving to Minnesota, appellee commenced this
action against Rush in a Minnesota state court, alleging negligence and seeking damages. As Rush had no
contacts with Minnesota that would support in personam jurisdiction, appellee attempted to obtain quasi in
rem jurisdiction by garnishing the contractual obligation of State Farm Mutual Automobile Insurance Co.
(State Farm) to defend and indemnify Rush in connection with such a suit. State Farm, which does business in
Minnesota, had insured the car, owned by Rush's father, under a liability insurance policy issued in Indiana.
Rush was personally served in Indiana, and after State Farm's response to the garnishment summons
asserted that it owed the defendant nothing, appellee moved the trial court for permission to file a
supplemental complaint making the garnishee, State Farm, a party to the action. Rush and State Farm moved
to dismiss the complaint for lack of jurisdiction over the defendant. The trial court denied the motion to
dismiss and granted the motion for leave to file the supplemental complaint. The Minnesota Supreme Court
affirmed, ultimately holding that the assertion of quasi in rem jurisdiction under the Minnesota garnishment
statute complied with the due process standards enunciated in Shaffer v. Heitner, 433 U. S. 186.

Held: A State may not constitutionally exercise quasi in rem jurisdiction over a defendant who has no forum
contacts by attaching the contractual obligation of an insurer licensed to do business in the State to defend
and indemnify him in connection with the suit. Pp. 444 U. S. 327-333.

(a) A State may exercise jurisdiction over an absent defendant only if the defendant has certain minimum
contacts with the forum such that the maintenance of the suit does not offend traditional notions of fair play
and substantial justice.International Shoe Co. v. Washington, 326 U. S. 310. In determining whether a
particular exercise of state court jurisdiction is consistent with due process, the inquiry must focus on "the
relationship among the defendant, the forum, and the litigation." Shaffer v. Heitner, supra at 433 U. S. 204. P.
327.

(b) Here, the only affiliating circumstance offered to show a relationship among Rush, Minnesota, and this
lawsuit is that Rush's insurance

Page 444 U. S. 321

company does business in the State. However, the fictional presence in Minnesota of State Farm's policy
obligation to defend and indemnify Rush -- derived from combining the legal fiction that assigns a situs to a
debt, for garnishment purposes, wherever the debtor is found with the legal fiction that a corporation is
"present," for jurisdictional purposes, wherever it does business -- cannot be deemed to give the State the
power to determine Rush's liability for the out-of-state accident. The mere presence of property in a State
does not establish a sufficient relationship between the owner of the property and the State to support the
exercise of jurisdiction over an unrelated cause of action, and it cannot be said that the defendant engaged in
any purposeful activity related to the forum that would make the exercise of jurisdiction fair, just, or
reasonable merely because his insurer does business there. Nor does the policy provide significant contacts
between the litigation and the forum, for the policy obligations pertain only to the conduct, not the
substance, of the litigation. Pp. 444 U. S. 327-330.

(c) Moreover, the requisite minimum contacts with the forum cannot be established under an alternative
approach attributing the insurer's forum contacts to the defendant by treating the attachment procedure as
the functional equivalent of a direct action against the insurer, and considering the insured a "nominal
defendant" in order to obtain jurisdiction over the insurer. The State's ability to exert its power over the
"nominal defendant" is analytically prerequisite to the insurer's entry into the case as a garnishee, and if the
Constitution forbids the assertion of jurisdiction over the insured based on the policy, then there is no
conceptual basis for bringing the "garnishee" into the action. Nor may the Minnesota court attribute State
Farm's contacts to Rush by considering the "defending parties" together and aggregating their forum
contacts in determining whether it has jurisdiction. The parties' relationships with each other may be
significant in evaluating their ties to the forum, but the requirements of International Shoe must be met as to
each defendant over whom a state court exercises jurisdiction. Pp. 444 U. S. 330-332.

272 N.W.2d 888, reversed.

MARSHALL, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, WHITE, BLACKMUN,
POWELL, and REHNQUIST, JJ., joined. BRENNAN, J., ante p. 444 U. S. 299, and STEVENS, J., post, p. 444 U. S.
333, filed dissenting opinions.
Page 444 U. S. 322