home page that it could help customers "across the U.S." supported reasonable inference that publication of home page might have New York consequences, sufficient for § 302(a)(3)(ii) long-arm jurisdiction); Jones v. LaBofa, supra, 1997 U.S. Dist. LEXIS 16147, *14, 1997 WL 642468, at *3 (foreign chair manufacturer's distributorship agreements in the United States supported finding that manufacturer reasonably should have expected use of its chairs in New York).
In this case, as already discussed, the evidence shows that Kurz-Hastings sold the allegedly defective hot stamping press machine to Forbes in New York, pursuant to a nationwide "exclusive sales rights" agreement with Navitas. In addition, Mr. Arita admits in his affidavit that Navitas had an "oral" agreement to manufacture press machines for sale by Kurz-Hastings (Arita Aff., P 23), and that Navitas had "general knowledge that Kurz-Hastings would resell [the machines] somewhere in Pennsylvania or one of the other 49 states in the United States" (id., P 26). This evidence is sufficient to establish a prima facie case of "foreseeability . . . coupled with a purposeful act" for long-arm jurisdiction over Navitas in New York, pursuant to C.P.L.R. § 302(a)(3)(ii).
The court now turns to the second part of the personal jurisdiction inquiry: whether the assertion of long-arm jurisdiction over Navitas comports with the requirements of due process.
C. Due Process.
The due process requirement for personal jurisdiction of a nondomiciliary in a federal court diversity action, enunciated by the Supreme Court in International Shoe Company v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945), protects a person without meaningful ties to the forum state from being subjected to binding judgments within its jurisdiction. Id. at 316; see Metropolitan Life, supra, 84 F.3d at 567. By requiring "fair warning" that activities in a state may subject a person to suit in that state's courts, the due process clause "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." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72, 85 L. Ed. 2d 528, 105 S. Ct. 2174 (1985). In order to determine whether the exercise of personal jurisdiction is proper, the court must determine, first, whether the defendant has sufficient "minimum contacts" with the forum state, and second, whether the assertion of personal jurisdiction comports with "traditional notions of fair play and substantial justice"--that is, whether it is reasonable under the circumstances of the particular case. See International Shoe, supra, 326 U.S. at 316; Metropolitan Life, supra, 84 F.3d at 567-68.
1. Minimum Contacts.
In World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 62 L. Ed. 2d 490, 100 S. Ct. 559 (1980), the Supreme Court considered the following question: whether an Oklahoma court could exercise personal jurisdiction over a non-resident automobile retailer and its wholesale distributor in a products liability action, "when the defendants" only connection with Oklahoma [was] the fact that an automobile sold in New York to New York residents became involved in an accident in Oklahoma." Id. at 287. The holding in World-Wide Volkswagen has been repeatedly cited for the proposition that "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 by consumers in the forum State." Id. at 298. In other words, a foreign corporation "purposefully avails" itself of a particular forum where the corporation places its products into interstate commerce and reasonably foresees that those products will be delivered into that forum. Id. at 297.
Notwithstanding the broad language of this standard, the Court clearly stated that, for purposes of due process analysis, merely placing a product into the "stream of commerce" does not by itself give rise to the requisite expectation that the product will enter a particular state. The Court specifically stated that "'foreseeability' alone has never been a sufficient benchmark for personal jurisdiction under the Due Process Clause . . .," id. at 295, precisely because "foreseeability," taken to its logical extremes, would permit every seller of a product to be amenable to suit wherever the product traveled. Id. at 296. Instead, the Supreme Court instructed that "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 297. As stated by the Court:
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 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 by consumers in the forum State.
Id. at 297-98.
Subsequent to the World-Wide Volkswagen decision, the Supreme Court in Asahi Metal Ind. v. Superior Court of California, supra, attempted to clarify the scope of the "stream of commerce" language and its relationship to the "purposeful availment" prong of the minimum contacts inquiry. However, no majority in Asahi was able to conclusively establish an interpretation of what constituted "minimum contacts" in product liability cases. Instead, Asahi was decided on the ground that subjecting the foreign defendant to jurisdiction in California would violate the "reasonableness" prong of International Shoe. Justice Brennan, joined by Justices White, Marshall and Blackmun, concluded that the "stream of commerce" standard in products liability cases should be read as allowing jurisdiction over any manufacturer or retailer which places its product in the stream of commerce and is aware that its product may be sold in the forum state. Asahi, supra, 480 U.S. at 116-17 (Brennan, J., concurring in part and concurring in the judgment). Justice O'Connor, joined by Chief Justice Rehnquist and Justices Powell and Scalia, rejected this broad interpretation and concluded that merely placing a product into the stream of commerce with knowledge that it may be swept into a particular forum, without more, is insufficient to find purposeful availment under the minimum contacts test. Instead, these Justices interpreted World-Wide Volkswagen as requiring an additional showing of some affirmative act by the defendant purposefully directed at the forum state. Id. at 112 (O'Connor, J.). Justice Stevens, the swing vote, ultimately joined with Justice O'Connor's opinion to the extent it decided the case on "reasonableness" grounds, but specifically disagreed with Justice O'Connor's treatment of the minimum contacts issue.
Since Asahi, the circuits have split over whether the "stream of commerce" standard in World-Wide Volkswagen requires a plaintiff to establish jurisdiction in products liability cases by showing affirmative conduct by the defendant purposefully directed at the forum. See, e.g., Lesnick v. Hollingsworth & Vose Co., 35 F.3d 939, 945-46 (4th Cir. 1994)(adopting Justice O'Connor's position), cert. denied, 513 U.S. 1151, 130 L. Ed. 2d 1070, 115 S. Ct. 1103 (1995); Boit v. Gar-Tec Products, Inc., 967 F.2d 671, 682-83 (1st Cir. 1992)(same); Falkirk Mining Co. v. Japan Steel Works, Ltd., 906 F.2d 369, 375 (8th Cir. 1990) (same); compare Dehmlow v. Austin Fireworks, 963 F.2d 941, 947 (7th Cir. 1992)(adopting Justice Brennan's position); Irving v. Owens-Corning Fiberglas Corp., 864 F.2d 383, 385-86 (5th Cir.)(same), cert. denied, 493 U.S. 823, 110 S. Ct. 83, 107 L. Ed. 2d 49 (1989).
The Second Circuit has not specifically adopted either interpretation of the Asahi case, but instead has taken an alternative approach to the "minimum contacts" inquiry. As explained in Metropolitan Life, the cases make a distinction between "specific" jurisdiction and "general" jurisdiction. "Specific jurisdiction exists when 'a State exercises personal jurisdiction over a defendant in a suit arising out of or related to the defendant's contacts with the forum'; a court's general jurisdiction, on the other hand, is based on the defendant's general business contacts with the forum state and permits a court to exercise its power in a case where the subject matter of the suit is unrelated to those contacts." Metropolitan Life, supra (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16, 80 L. Ed. 2d 404, 104 S. Ct. 1868 & nn. 8-9 (1984)).
The distinction is important because of the relative showing required to meet the minimum contacts test in each type of case. As stated in Jones v. LaBofa A/S, supra, "the court requires fewer contacts if the lawsuit arises out of or is related to the defendant's contacts with the forum ('specific jurisdiction') than if the plaintiff merely alleges that the defendant has general business contacts with the state ('general jurisdiction')." 1997 U.S. Dist. LEXIS 16147, *9, 1997 WL 642468, at *3. Thus, in a "specific jurisdiction" case, the plaintiff must make a prima facie showing "that the defendant has 'purposefully directed' his activities at residents of the forum," Burger King, supra, 471 U.S. at 472, and that "the underlying action is based upon activities that arise out of or relate to the defendant's contacts with the forum." Id.; see also In re Application to Enforce Administrative Subpoenas Duces Tecum of S.E.C. v. Knowles, 87 F.3d 413, 418 (10th Cir. 1996); Aerogroup International, Inc. v. Marlboro Footworks, Ltd., 956 F. Supp. 427, 439 (S.D.N.Y. 1996). In contrast, because general jurisdiction is not related to the events giving rise to the suit, courts impose a more stringent minimum contacts test, requiring the plaintiff to demonstrate the defendant's "continuous and systematic general business contacts" with the forum state. Metropolitan Life, supra, 84 F.3d at 568; see also Kuenzle v. HTM Sport-und Freizeitgerate AG, 102 F.3d 453 (10th Cir. 1996); Grand Entertainment Group, Ltd. v. Star Media Sales, Inc., 988 F.2d 476, 481 n. 3 (3d Cir. 1993); Shute v. Carnival Cruise Lines, 897 F.2d 377, 380-81 (9th Cir. 1990), rev'd on other grounds, 499 U.S. 585, 113 L. Ed. 2d 622, 111 S. Ct. 1522 (1991); Donatelli v. National Hockey League, 893 F.2d 459, 462-63 (1st Cir. 1990); Bearry v. Beech Aircraft Corp., 818 F.2d 370, 374 (5th Cir. 1987).
This distinction is also critical to the outcome of Navitas' motion in this case. As explained in Metropolitan Life :
A reviewing court must first examine the defendant's contacts with the forum. If the same do not exist in sufficient abundance, that is, if the constitutionally necessary first-tier minimum is lacking, the inquiry ends. If, however, the minimum exists, the criteria catalogued by the [Supreme] Court [to evaluate reasonableness] must be assessed in order to determine the constitutionality, in the particular circumstances, of an exercise of jurisdiction.