to the forum other than the lawsuit. Id. at 780.
Like considerations favor a finding that jurisdiction over the defendants in this case can be constitutionally asserted. Hymowitz, Besser, and the legislative modifications to New York's statutes of limitations for DES plaintiffs evince New York's intent to provide as full a recovery as is practicable to those of its residents injured by DES. New York and its residents therefore have a strong interest in the assertion of jurisdiction. Likewise, the several states share an interest in the efficient resolution of DES cases.
The fit with Keeton is not exact. In the present case, for example, some of the DES manufacturers cannot be said to have directly availed themselves of the forum state's market, whereas Hustler clearly did, albeit to a trivial extent. Still, by competing to establish a territorial niche within the national DES market, every manufacturer directly or indirectly benefited from the Commerce Clause of the federal Constitution and the laws of every state in the nation by participating in the national market for a generic good. In a sense, then, each DES manufacturer did "purposefully derive benefit from [its] interstate activities," such that none may be entitled to rely on the Due Process Clause "as a territorial shield to avoid interstate obligations that have been voluntarily assumed." Burger King, 471 U.S. at 473-74. Under the federal Commerce Clause and the substantive law of Hymowitz, the United States constitutes a common economic pond that knows no state boundaries. A substantial interjection of products at any point of the national market has ripple effects in all parts of the market.
The strain created in trying to accommodate jurisdictional issues raised by mass torts into the literal requirements of accepted formulations like "purposeful availment" suggests that modifications of jurisdictional law may be no less appropriate than modifications of substantive and quasi-substantive law already undertaken by state courts and legislatures. The standard jurisdictional formulations are, after all, the product of traditional cases which were not decided with mass litigation in mind. In this instance, at least, where substantive law has undergone significant development to accommodate socioeconomic change, it is necessary to interpret jurisdictional law so that it meets the demands of the subject matter of the litigation. See, e.g., Erichson, Note: Nationwide Personal Jurisdiction, supra, at 1158 & n.265 (noting recent scholarship discussing advantages of linking substantive and procedural law). The need for adaptation in this case is clearly indicated by the fact that, without it, these New York plaintiffs would likely be barred from recovering from these defendants in any court, If, for example, plaintiffs sought out the defendants in the California courts, California choice-of-law rules would probably call for the application of California substantive law, See Bernhard v. Harrah's Club, 16 Cal. 3d 313, 546 P.2d 719, 128 Cal. Rptr. 215 (Cal.) (en banc) (adopting "comparative impairment of state interests" approach to choice-of-law issues), cert. denied, 429 U.S. 859, 50 L. Ed. 2d 136, 97 S. Ct. 159 (1976). The defendants could then obtain a dismissal under Sindell by providing that they did not market DES in New York.
The Supreme Court itself has suggested the need for modified jurisdictional analysis in the special context of mass litigation. In the Shutts case, the Court confronted the issue of whether the Kansas state court had jurisdiction to bind each of the almost 30,000 plaintiff class members located around the country without requiring a showing of minimum contacts between each member and Kansas. Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 86 L. Ed. 2d 628, 105 S. Ct. 2965 (1985). Noting the necessity of the national class action device to provide relief where it might otherwise be unattainable, Chief Justice Rehnquist wrote that "minimum contacts" analysis was inapplicable and that, instead, a lower standard of "minimal procedural due process protection" was sufficient. Id. at 811-12. This standard requires only (1) best practicable notice and an opportunity to be heard, as defined by Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 94 L. Ed. 865, 70 S. Ct. 652 (1950); (2) a right to opt out of the litigation and (3) a showing that the named plaintiff(s) adequately represent absent class members. Id. at 812. By this formula, the Court essentially employed the time-honored jurisdiction-stretching technique of implied consent to cope with the special problem of jurisdiction in mass class actions: plaintiffs who received notice and did not opt-out were deemed to have implicitly consented to jurisdiction. See Miller & Crump, Jurisdiction and Choice of Law in Multistate Class Actions After Phillips Petroleum Co. v. Shutts, 96 Yale L.J. 1, 16-17 (noting Court's reliance on fiction of implied consent).
Similar modifications are necessary in the DES context. Although the Shutts opinion stressed that its treatment of the plaintiff class did not necessarily apply to defendants or defendant classes, see Shutts, 472 U.S. at 808-11 & 811-12 n.3, the difficulties raised by mass litigation and the present case warrant a restatement of jurisdictional due process law that can function in this and other mass torts.
2. Case Law in Non-Mass Torts
The federal and state courts have been wrestling with the jurisdictional requirements of the Due Process Clause for 125 years. Although this area of law has necessarily responded to technological, social and economic change, its evolution has been halting and uncertain. Whereas the realization of the national economy all but compelled a genuine revolution in the substantive constitutional law of the Commerce and Due Process Clauses, a similarly complete transformation in the more rarefied realm of jurisdictional due process law has not been completed. The vocabulary of jurisdiction has changed -- "presence" and "implied consent" have given way to "minimum contacts" and "purposeful availment." But these changes have not yet achieved complete clarity and coherence. Rather, the courts continue to function with an apparatus of concepts that recognizes, but does not quite systematize, the competing interests of defendants, plaintiffs, the courts, the individual states as sovereigns and the interstate system.
At the center of the problem is the idea that the Due Process Clause forbids a state legislature from empowering the state's courts to adjudicate cases against defendants having no territorial nexus with the state. The longevity of this idea has been remarkable. Since it first surfaced in Pennoyer v. Neff, it has been continuously attacked. A legion of commentators and judges have demonstrated that the mid-nineteenth century territorial nexus requirement needs modification for end-of-twentieth century litigation. The growing interconnectedness of the national economy and increased social mobility often have rendered the requirement unworkable in its original form.
As much as they might like to, however, the lower courts cannot simply abandon such well-entrenched doctrine in developing a due process standard for mass torts. Cf. Stephens, Sovereignty and Personal Jurisdiction, supra, at 133 (Supreme Court's continuing reliance on inquiry into "sovereignty" component of jurisdictional law cannot properly be ignored); Stein, Styles of Argument and Interstate Federalism in the Law of Personal Jurisdiction, 65 Tex. L. Rev. 689, 734-48, 761 (1987) (same). The current task in this area is instead to clarify the role that the nexus requirement plays in Due Process Clause jurisprudence for cases reflecting new substantive law.
a. Pennoyer and Its Problems
The territorial nexus requirement is the child of Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1877). In that case the Supreme Court invalidated a default judgment against Neff on the ground that Oregon could not assert personal jurisdiction over a person not present in the state absent that person's consent. The Court suggested that the Due Process Clause of the fourteenth amendment required such a result. Id. at 733. But see Borchers, The Death of the Constitutional Law of Personal Jurisdiction, supra, at 38-43 (arguing that Pennoyer required only that absent defendants be served according to the terms of existing state statutes).
Pennoyer 's conclusion that presence and consent are the only bases for jurisdiction was supported by two arguments. Both of these arguments focused in the first instance not on the liberty and property interests of absent defendants, but rather on the limited power of sovereign states within a federal system. Although neither of these arguments is particularly compelling, the focus of both on the limited nature of state sovereignty identifies what was to become a perennial concern of the courts.
The first, more familiar, argument purports to base the result in Pennoyer on principles of international comity. In the words of Justice Field:
The several States are of equal dignity and authority, and the independence of one implies the exclusion of power from all others. And so . . . the laws of one State have no operation outside of its territory, except so far as is allowed by comity; and . . . no tribunal established by it can extend its process beyond that territory so as to subject either persons or property to its decisions.
Pennoyer, 95 U.S. at 722. The problem with this argument is that legislation pertaining to the ability of a state court to render judgments effective in that state is properly viewed -- and apparently has been viewed since the time of the Magna Carta -- as an entirely domestic exercise of power that does not raise comity concerns. See generally Whitten, The Constitutional Limitations on State-Court Jurisdiction: A Historical-Interpretative Reexamination of the Full Faith and Credit and Due Process Clauses (pt. 2), 14 Creighton L. Rev. 735 (1981) (arguing that Pennoyer 's introduction of comity concerns into the meaning of "due process" marked a radical departure from traditional usage). Justice Field seems to have suggested as much in an earlier case. See Galpin v. Page, 85 U.S. (18 Wall.) 350, 368-69, 21 L. Ed. 959 (1873); Borchers, The Death of the Constitutional Law of Personal Jurisdiction, supra, at 32 (arguing that Galpin recognized the legitimacy of extraterritorial reach of state jurisdictional legislation). By authorizing jurisdiction over non-resident defendants, state legislatures are not usurping or disrespecting the power of other sovereigns; they are establishing internally effective jurisdictional rules. Whether other states are required to give such judgments full faith and credit had, until Pennoyer, been treated as a separate question.
The second argument in Pennoyer stems not from a purported concern for comity, but rather from a concern for its opposite: realpolitik. To use Justice Field's effective imagery, "process from the tribunals of one State cannot run into another State, and summon parties there domiciled to leave its territory and respond to proceedings against them." Id. at 727. Since state legislatures could not realistically ensure the production of absent defendants, the Court seemed to suggest, the Due Process Clause would save them the trouble by preventing the assertion of jurisdiction over those defendants.
This justification of the result in Pennoyer is untenable for many reasons. Its rationale would prevent legislatures from providing for jurisdiction over residents who were temporarily absent from the state. More generally, the idea that due process limits a state legislature's authority to the scope of its de facto physical power would leave states unable to provide basic protections to their residents. The Constitution could not reasonably be read to require states to suffer in silence while absent defendants played havoc with their residents.
The interesting feature of Pennoyer 's two arguments is that, at least on the surface, they bear little connection to due process. Justice Field's interest was the theoretical basis for states' power to authorize judgments. The traditional due process concerns -- whether the defendant will suffer a deprivation of liberty or property without fair notice and a reasonable opportunity to defend -- are at best only tangentially related to these sovereignty concerns. If a state court judgment against a non-resident defendant who had a genuine opportunity to mount a defense is in some sense ultra vires, it is not at all obvious that its illegitimacy amounts to the absence of due process.
This was the point of Justice Hunt's Pennoyer dissent, which rejected the idea that the Due Process Clause provides any limitation on assertions of jurisdiction beyond the requirement of notice and opportunity to be heard.
It belongs to the legislative power of the State to determine what shall be the modes and means proper to be adopted to give notice to an absent defendant of the commencement of a suit; and if they are such as are reasonably likely to communicate to him information of the proceeding against him, and are in good faith designed to give him such information, and an opportunity to defend is provided for him in the event of his appearance in the suit, it is not competent to the judiciary to declare that such proceeding is void as not being by due process of law.
Pennoyer, 95 U.S. at 737 (Hunt, J., dissenting).
Despite purporting on several occasions to reject Pennoyer in favor of a due process analysis focusing exclusively on the liberty and property interests of absent defendants, the Supreme Court has never adopted Justice Hunt's view. This fact is of great significance. From 1877 forward, the courts were forced to expend considerable effort to sustain Pennoyer in the face of historical developments that had rendered its holding obsolete. By the time of International Shoe Co. v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945), the Supreme Court was apparently sufficiently frustrated to want to pull the plug on sovereignty-based theories of personal jurisdiction and replace them with a conceptually independent fairness analysis that examined only the burdens that assertions of jurisdiction place on particular defendants. In that period of constitutional history, moreover, the Court was bent on abandoning other substantive due process restraints on state legislative activity.
Still, the Supreme Court did not find its way to completely abandoning the sovereignty inquiry started in Pennoyer. Likewise, subsequent pronouncements of the death of the "sovereignty" component in the due process inquiry have proved greatly exaggerated. From Pennoyer to the present day, due process has always required the plaintiff to demonstrate the forum state's authority to support an assertion of extra-territorial jurisdiction. International Shoe eventually endorsed a separate inquiry, already evidenced in the prior case law of "presence" and "implied consent," which focuses on a defendant's interest in not being unduly burdened in presenting its case. This fairness inquiry, however, supplemented, rather than supplanted, Pennoyer 's sovereignty inquiry.
The salient feature of the history of the two independent inquiries into sovereignty and fairness is that, when they made their formal debut together in International Shoe, they both imported Pennoyer 's territorial nexus requirement. Under International Shoe, it is only when a non-resident defendant's contacts with a state reach a certain level that the state has authority to assert jurisdiction over that defendant. Likewise, with respect to the fairness inquiry, International Shoe and subsequent cases have considered it unfair to assert jurisdiction over a defendant unless that defendant has conducted certain activity in the forum state.
Recognizing that a territorial nexus requirement has crept into both the sovereignty and fairness components of the constitutional law of personal jurisdiction provides a conceptual basis from which to develop a set of standards that is both workable in the context of mass litigation yet respectful of the traditional incorporation of a nexus requirement. Two additional steps are required. First, it must be understood that a nexus requirement makes a good deal more sense as a component of the sovereignty inquiry than it does as a part of the fairness inquiry. This explains why, despite longstanding criticism to the contrary, some kind of nexus requirement has been retained in the constitutional law of personal jurisdiction.
The second step requires recognizing that Pennoyer 's requirement of a territorial nexus mistook an instance of a theory of sovereignty for the theory itself. In other words, while Pennoyer and International Shoe were both correct to include a nexus requirement as part of the sovereignty inquiry, they need not have required a territorial nexus as the basis for assertions of jurisdiction. As subsequent cases have implicitly established, the nexus requirement is satisfied so long as a state has a tangible interest in litigation arising out of a non-resident defendant's acts, whether or not those acts occurred within the state.
With the accommodation of nexus concerns entirely within the sovereignty branch, and the severance of territorial notions from the more general concerns behind the nexus requirement, a more reasonable and systematic accommodation of the interests of parties, the forum state, and the other states is possible. To establish its contours requires a brief recounting of the well-travelled history of personal jurisdiction.
b. Pennoyer to International Shoe : The Emergence of Fairness Inquiry
From its inception, Pennoyer was awkward in application. Corporations had engaged in substantial interstate commerce since before the Civil War. These corporations were deemed to exist (and therefore to be present) in their state of incorporation. Insofar as they chose not to consent to jurisdiction elsewhere, they were, by a literal reading of Pennoyer, invulnerable tostate court actions outside of their home state. The reality of interstate activity thus necessitated the invention of expanded notions of "Presencell and "consent." The courts' use of these doctrines eventually raised theoretical complexities that pointed toward the development of an alternative "fairness" doctrine that promised to replace, but ultimately only modified, Pennoyer.
From before the time of Pennoyer, the Supreme Court had held that a state legislature was entitled to extort "consent" to jurisdiction as a condition of a foreign corporation's doing business in the state. See Lafayette Ins. Co. v. French, 59 U.S. (18 How.) 404, 407, 15 L. Ed. 451 (1855). The usage of "consent" in this context was disingenuous. The assertion of jurisdiction in these instances was clearly based on the power of the states to exact obedience to their jurisdictional laws because of their status as sovereign nations with the right to control their borders and activity within their borders. See id. (proper for state to "compel" foreign corporation to designate agent for service of process).
The assumption that a state had the power to exclude corporations or other entities created in other states was and is incompatible with the commercial nation envisioned under the Commerce Clause, which was meant to permit businesses to roam at will through the common United States market without discriminatory inhibition. See Gibbons v. Ogden, 22 U.S. (9 Wheat) 1, 6 L. Ed. 23 (1824). Within ten years, the premise of Lafayette was in any event put to rest as a practical matter by the victorious armies of the federal government. The Court conceded as much when, at the time of Pennoyer, it held that the states were powerless to exclude foreign corporations from conducting interstate commerce. Pensacola Tel. Co. v. Western Union Tel. Co., 96 U.S. 1, 24 L. Ed. 708 (1877). The Court apparently did not immediately recognize that such a substantive law holding undermined Lafayette. See Kurland, The Supreme Court, the Due Process Clause and the In Personam Jurisdiction of State Courts, 25 U. Chi. L. Rev. 569, 581 (1958).
Two alternative doctrines for establishing jurisdiction -- "corporate presence" and "doing business" -- avoided the problem of Lafayette but raised theoretical problems of their own. By these doctrines, absent corporations were treated as present (or, as it was later called, doing business) if they conducted enough of the right sort of activity in the forum state and were therefore deemed amenable to what is now called "general" jurisdiction. See id. at 583-84.
The problem of presence theory, which recently resurfaced in Burnham v. Superior Court, 495 U.S. 604, 110 S. Ct. 2105, 109 L. Ed. 2d 631 (1990), is that it seems to grant each state too much, rather than too little, jurisdictional reach. Given the premises of Pennoyer, even fleeting presence was sufficient to support general jurisdiction for all causes of action. In theory, a corporation, which is comprised of the actions of the natural persons who act on its behalf, is "present" wherever any of its officials are even transitorily involved with corporate business. See Hutchinson v. Chase & Gilbert, Inc., 45 F.2d 139, 141 (2d Cir. 1930) (L. Hand., J.) (corporation "must be equally present wherever any part of its work goes on, as much in the little as in the great"). Thus non-resident corporations should have been amenable to general jurisdiction for transient forum activities.
The courts steadfastly resisted the idea of transient corporate presence by requiring more than a minimal quantum of in-state activity by corporate officers and agents. See Kurland, The Due Process Clause and In Personam Jurisdiction, supra, at 582-86 (describing application of presence and doing business doctrines). But to the extent they did so, it was on the basis of independent fairness concerns that did not derive from the premises of presence theory. As Judge Learned Hand famously noted, courts that engaged in these analyses were using territorial contacts as indices of the reasonableness of haling absent defendants into court despite the fact that there were many instances in which there was little or no correlation between the existence (or non-existence) of a territorial nexus and the fair (or unfair) treatment of defendants. Hutchinson, 45 F.2d at 142.
After Pennoyer, the courts also made use of "implied consent" doctrine to support "specific" jurisdiction. See Kurland, The Due Process Clause and In Personam Jurisdiction, supra, at 578-82. For example, Justice Field, concerned in Pennoyer about the unfairness of asserting jurisdiction over absent natural persons, was quite willing to find that absent corporations that conducted business in a forum had implicitly consented to jurisdiction for causes of action arising from that business. St. Clair v. Cox, 106 U.S. 350, 356, 27 L. Ed. 222, 1 S. Ct. 354 (1882).
The use of the term "consent" in this context was also disingenuous -- and ambiguously so. Implied consent theory amounted to conceptual "fudging": it incorporated at least three distinct ideas, two concerning sovereignty, and one concerning fairness to defendants.
The first sovereignty argument in "implied consent" theory was a presence argument. On this view, implied consent doctrine allowed the state courts to exert jurisdiction over corporations whose activities rendered them "present" in the forum. This idea raised the problem of potentially too-expansive jurisdiction associated with corporate presence and doing business doctrine.
The roots of implied consent theory could also be found in a theory of sovereignty that substituted "interest" for "presence" analysis. The interest theory, which later resurfaced in International Shoe, starts from the premise that states may impose certain obligations on individuals to protect the well being of their citizens and their own policies. It follows that, where a non-resident defendant has voluntarily undertaken certain acts affecting residents or policies of the state, the state may impose an obligation on the non-resident to defend suits in that forum which arise from those acts.
Although there is an element of voluntariness in this theory -- the defendant chooses to undertake certain acts -- the basis for the obligation to defend in the forum state is not its voluntary assumption by the defendant. Presumably many defendants would choose to undertake acts with forum consequences without accepting such an obligation. Instead the notion is that states possess the authority to set the terms under which non-residents may choose to act if those acts affect state interests.
The final element of implied consent theory was the same notion of fairness identified in the presence and doing business cases. As in those cases, implied consent doctrine used the existence of a forum nexus as a benchmark for fairness on the idea that those non-resident defendants that availed themselves of particular fora would be the same defendants that were able to mount meaningful defenses in those fora.
In the period between Pennoyer and International Shoe, then, the tenable theories of general and specific jurisdiction were viable only because they smuggled in an expanded "interest" theory of sovereignty and an independent fairness limitation not rooted in the notions of power and consent which Pennoyer had read into the Due Process Clause. For this reason, the courts' efforts to sustain Pennoyer amounted to a form of limited chemotherapy designed to stem, but not cure, a jurisdictional cancer. By using presence, doing business, and implied consent, the courts mitigated the worst features of the disease for a time, but they never cured the underlying problem and the treatment engendered debilitating conceptual side effects.
c. International Shoe : Sovereignty, Fairness and Nexus Requirements
Along with other doctrines implicating federalism and interstate commerce concerns, the issue of state court civil jurisdiction came to a head in the 1930s and 1940s. Like its siblings in substantive Due Process and Commerce Clause jurisprudence -- see, e.g., West Coast Hotel Co. v. Parrish, 300 U.S. 379, 81 L. Ed. 703, 57 S. Ct. 578 (1937); United States v. Darby, 312 U.S. 100, 85 L. Ed. 609, 61 S. Ct. 451 (1941) -- International Shoe Co. v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945) promised to clear away the nineteenth-century theoretical underbrush and set the constitutional law of personal jurisdiction on a course required by the national economy. It was, however, less successful than its substantive law counterparts in achieving this goal.
Parts of International Shoe did suggest a genuine transformation. Its use of the phrase "traditional notions of fair play and substantial justice," borrowed from Milliken v. Meyer, 311 U.S. 457, 463, 85 L. Ed. 278, 61 S. Ct. 339 (1940), suggested that the Court had abandoned sovereignty inquiry altogether, as well as the territorial nexus component of fairness inquiry, in favor of an independent analysis of the conditions under which it would be fair to oblige a defendant to litigate in a foreign forum. See Redish, Due Process, Federalism, and Personal Jurisdiction, supra, at 1117. Such an interpretation was supported by Milliken, in which the Court focused its due process analysis exclusively on the adequacy of notice and defendant's opportunity to be heard, apparently without concern for the absent defendant's presence or contacts. 311 U.S. at 463. Likewise, later cases, particularly McGee v. International Life Ins. Co., 355 U.S. 220, 2 L. Ed. 2d 223, 78 S. Ct. 199 (1957) -- which recognized the need to interpret the law of personal jurisdiction in light of the "fundamental transformation of our national economy" -- downplayed both territorial and convenience concerns. Id. at 222-23.
International Shoe did not, however, completely free itself of Pennoyer and post-Pennoyer complications. Its test brought to the fore, but did not resolve, the conflicting ideas buried in implied consent doctrine. Thus, in formulating the new due process standard, Chief Justice Stone, writing for the Court, continued the traditional emphasis on a defendant's activities within the forum state:
[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. Cf. Pennoyer v. Neff, supra ; Minnesota Commercial Assn. v. Benn, 261 U.S. 140, 67 L. Ed. 573, 43 S. Ct. 293 .