This case involved whether a foreign corporation is subject to general personal jurisdiction in a product liability case in North Carolina for an accident that occurred outside of Paris, France, merely because other entities distributed in North Carolina other products made by the defendant company. The tire that allegedly failed was manufactured by Goodyear Turkey and was never shipped into the United States.
The lower court arguably confused specific jurisdiction (where a state has jurisdiction over a company in a lawsuit involving a specific product that it distributed in the state) with general jurisdiction (where the state tries to exercise jurisdiction over a company for activities that do not arise out of that company’s activities in the state).
The Supreme Court ruled that the foreign company is not amenable to suit in North Carolina on claims unrelated to any of their activity in the state. This is an important decision for manufacturers that could be threatened by lawsuits in jurisdictions where other entities distribute their products. The Fourteenth Amendment's Due Process Clause requires that a company have minimal contacts with a state before that state can exercise personal jurisdiction over it. There must be continuous and systematic general business contacts for a company to be subject to general jurisdiction in a state. Merely putting a product into the stream of commerce could subject a company to "specific" jurisdiction in a case involving that product, but not to any case involving other activities of the company.
This is an important decision that reduces the chances of forum shopping by plaintiffs, and helps foster international trade in the United States and our international relations abroad.
This case was argued in tandem with J. McIntyre Machinery Ltd. V. Nicastro.