Opinion ID: 423985
Heading Depth: 1
Heading Rank: 2

Heading: Long Arm Jurisdiction

Text: 14 In determining whether a court has personal jurisdiction over a defendant, we use a two-step analysis. Raffaele, 707 F.2d at 396. We first apply the forum state's long-arm statute and then consider whether its application comports with due process requirements. Taubler v. Giraud, 655 F.2d 991, 993 (9th Cir.1981). As Oregon's long-arm statute, Or.R.Civ.P. 4, confers jurisdiction to the outer limits of due process, State ex rel. Michelin v. Wells, 294 Or. 296, 657 P.2d 207 (1982); State ex rel. Hydraulic Servocontrols v. Dale, 294 Or. 381, 657 P.2d 211 (1982), we need consider only the second step here. See Raffaele, 707 F.2d at 396. We must decide whether Daiko's contacts with Oregon justify jurisdiction over Daiko for the purposes of this action. See Internat. Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945); Data Disc, Inc. v. Systems Tech. Assoc., Inc., 557 F.2d 1280, 1287 (9th Cir.1977). The minimal contacts requirements of constitutional due process are met when: (1) a nonresident defendant performs some act by which it avails itself of the benefits and protections of the forum's laws; (2) the claim arises out of or results from the defendant's forum-related activities, and (3) the exercise of jurisdiction is reasonable. Raffaele, 707 F.2d at 397; Data Disc, 557 F.2d at 1287. 15 Daiko performed a forum-related act when it produced a splice that it knew was destined for ocean-going vessels serving United States ports, including those of Oregon. Hedrick's claim resulted from the forum-related act. In World-Wide Volkswagen v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980), the fortuitous accident in Oklahoma of a car sold in New York did not provide sufficient connection with Oklahoma such that [the New York seller] should reasonably anticipate being haled into court there. Id. at 297, 100 S.Ct. at 567. In World-Wide Volkswagen, however, the Court noted that in cases where a defendant delivers its products into the stream of commerce with the expectation that they will reach the forum state, the forum's court may assert personal jurisdiction. Id. at 297-98, 100 S.Ct. at 257. Daiko's provision of the splice for an ocean-going ship resembled the delivery into the stream of commerce of the defective valve in Gray v. American Radiator & Standard Sanitary Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961), cited with approval in World-Wide Volkswagen, 444 U.S. at 298, 100 S.Ct. at 257. 16 Daiko produces over 300,000 splices per year, many of them for ocean-going vessels. Daiko, though it produces its splices only in Japan, manufactures for a world-wide market and provides splices for ships that serve world ports. The splice caused an injury to Hedrick in a port that was within the expected service area of Daiko's customers. By contrast, in World-Wide Volkswagen the distributor served a market limited to three states of the northeastern United States. Provision of a part to an ocean-going common carrier is different from the sale of an automobile to a private party. The probability that the part sold to an ocean carrier will be used in a foreign port is not fortuitous. It is certain. See DeJames v. Magnificence Carriers, Inc., 654 F.2d 280, 290-93 (3d Cir.) (Gibbons, J., dissenting), cert. denied, 454 U.S. 1085, 102 S.Ct. 642, 70 L.Ed.2d 620 (1981). 17 Finally, to satisfy the third test in Raffaele, the exercise of jurisdiction must be reasonable. This court's first study of the reasonableness of long-arm jurisdiction after World-Wide Volkswagen came in Ins. Co. of North America v. Marina Salina Cruz, 649 F.2d 1266 (9th Cir.1981). In that case we denied long-arm jurisdiction in Alaska over a Mexican shipyard that had performed work on a fishing vessel at the request of Seattle owners. When the vessel sank in Alaskan waters, allegedly as a result of modification work improperly done in Mexico, the owner's insurer sued in the district of Alaska. We held, in a point-by-point analysis of the various factors outlined in World-Wide Volkswagen, that on the facts of that case a Mexican shipyard could not reasonably be sued in Alaska. 18 This is a products liability case. A manufacturer or supplier of a defective product who knew or should have known that a product would enter the stream of foreign commerce can be subjected, consistently with due process, to a forum state's long-arm jurisdiction and be sued in the forum where the injury occurred. 19 As we noted in Raffaele, our opinion in Ins. Co. of North America v. Marina Salina Cruz, 649 F.2d 1266, 1270 (9th Cir.1981), set out a partial list of seven factors pertinent to the reasonableness inquiry. These factors are not mandatory tests, each of which a plaintiff must pass in order for a court properly to assume jurisdiction. Instead, the factors illuminate the considerations of fairness and due process set forth in International Shoe, 326 U.S. at 316, 66 S.Ct. at 158. 20 An application of these factors to this case reveals that it would be reasonable to subject Daiko to the jurisdiction of an Oregon court. While Daiko's purposeful interjection of its activities into Oregon was not extensive, the company sent a defective product into the world market with knowledge that harm could occur wherever a defect should manifest itself. Second, while Daiko's burden in defending an action in Oregon is significant, Hedrick's burden in suing Daiko in Japan exceeds that of Daiko in defending a suit in Oregon. Third, Oregon has a compelling interest in regulating the conduct of manufacturers who expose Oregon longshoremen to the hazards of defective products in Oregon ports. The impact of Hedrick's permanent injuries will be felt in Oregon. Fourth, Daiko has shown no conflict with any sovereign interests of Japan sufficient to outweigh Oregon's interest in litigating Hedrick's claim. Fifth, Oregon appears to be the most efficient forum to resolve the dispute. Much of the evidence must be gathered in Oregon because the accident occurred there and most of the witnesses to it live there. Oregon law would likely control. See Rocke v. Canadian Auto. Sport Club, 660 F.2d 395, 399-400 (9th Cir.1981). Sixth, availability of an Oregon forum is important to Hedrick's chances for convenient and effective relief. Seventh, while a Japanese forum might be available, we cannot say that it represents a practical alternative for an injured Oregon longshoreman. See Turner v. Japan Lines, Ltd., 651 F.2d at 1304. The balance of equities and the factors outlined above indicate that the exercise of jurisdiction over Daiko Shoji by a federal district court in Oregon is reasonable. Therefore the dismissal of Daiko Shoji as a defendant was error.