J. Mcintyre Machinery, Goodyear, and the Incoherence of the Minimum Contacts Test

Abstract

On June 27, 2011, when J. McIntyre Machinery Ltd. v. Nicastro and Goodyear Dunlop Tire Operations, S.A. v. Brown were handed down, it marked the first time in almost a quarter century that the United States Supreme Court engaged in an extended discussion of the minimum contacts test. That test has for nearly seven decades set the basic parameters of measuring the constitutionality of exercises of state-court personal jurisdiction. The cases were generally assumed to have been accepted for review by the Supreme Court to clarify two areas in which the constitutional boundaries of state-court jurisdiction were unclear. The first stemmed from the Supreme Court's 1987 decision in Asahi Metal Industry Co. v. Superior Court, which produced no majority opinion and thus left unclear whether the forum state sale of an allegedly dangerous product that caused injury to the plaintiff there sufficed to establish jurisdiction. The second was the quantum of unrelated business contacts in the forum state necessary to create jurisdiction. Unfortunately, as to the first issue, the Supreme Court again produced no majority opinion, and left the subject even more muddled than before. The plurality opinion written by Justice Kennedy attempted to re-ground state-court jurisdiction in a dubious sovereignty theory that the Supreme Court had rejected several times before. As to the second issue, the Court held that unrelated sales in the forum were not enough to establish jurisdiction. The Supreme Court appeared to announce a new test that required the defendant's contacts with the forum state be enough so that the defendant is "essentially at home" in the forum, but provided little elaboration as to what is meant by that phrase. This article argues that the two new cases represent a continuation of the Supreme Court's vacillating and unclear jurisprudence in this area, and that the fundamental difficulty is that the Court lacks any clear constitutional rationale for limiting exercises of assertions of state-court jurisdiction.

Keywords: minimum contacts, jurisdiction, state-court jurisdiction, stream of commerce, sovereignty

JEL Classification: K10, K20, K40, K41, K49