Opinion ID: 2833512
Heading Depth: 2
Heading Rank: 4

Heading: Single Sales

Text: The court of appeals relied on several cases by intermediate courts in Texas holding that a single contact with the state is sufficient to establish jurisdiction. [46] But the United States Supreme Court has emphatically answered the question whether a single contract with a Texas resident can automatically establish jurisdiction C “the answer clearly is that it cannot.” [47] Both the United States Supreme Court and this Court have found no purposeful availment in cases involving isolated sales solicited by consumers who proposed to use the product in a state where the defendant did no business. In World‑Wide Volkswagen Corp. v. Woodson , the Supreme Court held that dealers who sold a car in New York could not be sued in Oklahoma just because the buyers were involved in a collision there: [W]e find in the record before us a total absence of those affiliating circumstances that are a necessary predicate to any exercise of state‑court jurisdiction. Petitioners carry on no activity whatsoever in Oklahoma. They close no sales and perform no services there. They avail themselves of none of the privileges and benefits of Oklahoma law. They solicit no business there either through salespersons or through advertising reasonably calculated to reach the State. Nor does the record show that they regularly sell cars at wholesale or retail to Oklahoma customers or residents or that they indirectly, through others, serve or seek to serve the Oklahoma market. In short, respondents seek to base jurisdiction on one, isolated occurrence and whatever inferences can be drawn therefrom : the fortuitous circumstance that a single Audi automobile, sold in New York to New York residents, happened to suffer an accident while passing through Oklahoma. [48] The facts here are not the same as those in Woodson , but do not differ in any material respect. Michiana knew Holten would take his RV to Texas, while it was merely foreseeable to the defendant in Woodson that its buyer would drive his Audi to Oklahoma. [49] But in either case the choice was entirely that of the purchaser; the seller had no say in the matter. Under Holten’s theory, Michiana could be sued in any state or country from which he chose to place his call and take delivery. But as the Supreme Court stated, “unilateral activity . . . cannot satisfy the requirement of contact with the forum State.” [50] This Court addressed the same question in 1996 in CMMC v. Salinas . [51] In that case, a French manufacturer had made no effort to market its winepress equipment in Texas, had made only one other sale in Texas, and did not initiate the sale at issue to a Texas buyer. [52] We held that the Due Process Clause prohibited specific jurisdiction of a tort suit in Texas based on injuries resulting from alleged defects. [53] As Michiana’s contacts here are certainly no more and arguably somewhat less than those in CMMC , the result must be the same, as the Due Process Clause has not changed in the interim. It is true that in some circumstances a single contract may meet the purposeful- availment standard, but not when it involves a single contact taking place outside the forum state. A long-term franchise agreement may establish minimum contacts because, though it stems from a single contract, it involves many contacts over a long period of time. [54] Similarly, a life-insurance policy may stem from a single contract, but necessarily involves a series of contacts until death does the parties part. [55] Certainly a nonresident corporation ought to be subject to suit in any jurisdiction where it “enjoys the benefits and protection of the laws of that state.” [56] Here, it is hard to imagine what possible benefits and protection Michiana enjoyed from Texas law. Holten paid for the RV in advance, and could not have planned on taking it to Indiana regularly for service. Everything Michiana wanted out of the contract it had in hand. Indeed, it is hard to imagine how Michiana would have conducted its activities any differently if Texas had no law at all. Clearly, Michiana anticipated some profit from this single sale, at least until the litigation started. But “financial benefits accruing to the defendant from a collateral relation to the forum State will not support jurisdiction if they do not stem from a constitutionally cognizable contact with that State.” [57] We find none here.