Understanding the difference between jurisdictional issues and substantive laws is fundamental to determining whether a judgment from another state should be enforced. Jurisdictional concerns relate to a court’s power to hear a case, whereas substantive laws dictate the legal principles governing the merits of the dispute. A court must have jurisdiction to issue a valid judgment; once it does so, that judgment is commonly respected nationally unless violating public policy or lacking due process.
For example: If New York issues a judgment based on its securities laws, California may not re-examine the merits based on its own laws but would need to enforce it, provided New York had proper jurisdiction.