Monday, June 27, 2011

SCOTUS Decision in J. McIntyre Machinery v. Nicastro

The Supreme Court issued its decision in J. McIntyre Machinery v. Nicastro (No. 09-1343) today, a day that witnessed the Court’s first two decisions on personal jurisdiction in two decades. By a 6-to-3 vote, the Court reverses the New Jersey Supreme Court’s finding of jurisdiction, but there is no majority opinion. So the head-counting (and head-scratching) continues, much as it has since the fractured decision in Asahi Metal almost a quarter-century ago. Here’s how things break down:

Justice Kennedy writes a four-Justice plurality opinion, which is joined by Chief Justice Roberts and Justices Scalia and Thomas. They conclude that jurisdiction was improper, noting that “[a]t no time did petitioner engage in any activities in New Jersey that reveal an intent to invoke or benefit from the protection of its laws.” [Kennedy Op. 12]. Justice Ginsburg writes a dissenting opinion, which is joined by Justices Sotomayor and Kagan. They conclude that when there is “a local plaintiff injured by the activity of a manufacturer seeking to exploit a multistate or global market . . . , jurisdiction is appropriately exercised by courts of the place where the product was sold and caused injury.” [Ginsburg Op. 19].

That leaves Justices Breyer and Alito. They provide two more votes against jurisdiction in this case, but they do not join Justice Kennedy’s plurality. Justice Breyer’s concurring opinion, which Justice Alito joins, criticizes the plurality’s “strict rules that limit jurisdiction where a defendant does not intend to submit to the power of a sovereign and cannot be said to have targeted the forum.” [Breyer Op. at 4]. Nonetheless, Justices Breyer and Alito conclude that “on the record present here, resolving this case requires no more than adhering to our precedents.” [Breyer Op. at 4] They note in particular that “none of our precedents finds that a single isolated sale, even if accompanied by the kind of sales effort indicated here, is sufficient.” [Breyer Op. at 2] Although Justice Breyer acknowledges that “there may well have been other facts that Mr. Nicastro could have demonstrated in support of jurisdiction, . . . the plaintiff bears the burden of establishing jurisdiction, and here I would take the facts precisely as the New Jersey Supreme Court stated them.” [Breyer Op. at 3-4]

The biggest take-away from Nicastro may be that the Supreme Court does not plan to take another twenty-year hiatus from personal jurisdiction. The two tie-breaking Justices indicate that they are open to hitting the reset button on this issue if the Court were presented with a case that provides “a better understanding of the relevant contemporary commercial circumstances.” [Breyer Op. 7] Justice Breyer writes:

Because the incident at issue in this case does not implicate modern concerns, and because the factual record leaves many open questions, this is an unsuitable vehicle for making broad pronouncements that refashion basic jurisdictional rules. [Breyer Op. 4]

I would not work such a change to the law in the way either the plurality or the New Jersey Supreme Court suggests without a better understanding of the relevant contemporary commercial circumstances. Insofar as such considerations are relevant to any change in present law, they might be presented in a case (unlike the present one) in which the Solicitor General participates. Cf. Tr. of Oral Arg. in Goodyear Dunlop Tires Operations, S. A. v. Brown, O. T. 2010, No. 10–76, pp. 20–22 (Government declining invitation at oral argument to give its views with respect to issues in this case). This case presents no such occasion, and so I again reiterate that I would adhere strictly to our precedents and the limited facts found by the New Jersey Supreme Court. [Breyer Op. 7]

Stay tuned.

--A

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