Court Opinion

ID: 9539002
Source: CourtListenerOpinion
Date Created: 2023-08-07 07:45:16.859691+00
Date Added: 2024-06-11T14:58:22.913986
License: Public Domain

LUCAS, J.
I respectfully dissent. The Supreme Court of the United States has authoritatively stated that a foreign corporation’s knowledge or foreseeability that its product will be used in another state is not sufficient to subject it to in personam jurisdiction. The corporation must purposefully avail itself of the privilege of conducting activities in the forum state. (World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286, 295-297 [62 L.Ed.2d 490, 500-501, 100 S.Ct. 559].) The court stated, “If foreseeability were the criterion, a local California tire retailer could be forced to defend in Pennsylvania when a blowout occurs there.” (Id., at p. 296 [62 L.Ed.2d at p. 500].) Speaking to stream-of-commerce situations, the court explained that a corporation may be subjected to jurisdiction where the sale “arises from the efforts of the manufacturer or distributor to serve directly or indirectly, the market for its product in other States, ...” (Id., at p. 297 [62 L.Ed.2d at p. 501].) In contrast, “the mere ‘unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State. ’ ” (Id., at p. 298 [62 L.Ed.2d at p. 502], quoting Hanson v. Denckla (1958) 357 U.S. 235 [2 L.Ed.2d 1283, 78 S.Ct. 1228].)
The burden was on Cheng Shin Rubber Industrial Co., Ltd. (Cheng Shin) to establish by competent evidence that in personam jurisdiction existed over Asahi Metal Industry Co., Ltd. (Asahi). (Messerschmidt Development Co. v. Crutcher Resources Corp. (1978) 84 Cal.App.3d 819, 825 [149 Cal.Rptr. 35].) To my mind Cheng Shin has not carried that burden. Nowhere is it claimed that Asahi had any direct contact with California and no evidence supports the assertion that Asahi intended to serve the California market indirectly. Cheng Shin neglected to indicate what percentage of its total sales are made in the United States, but even assuming that Cheng Shin made 100 percent of its sales in this country, Asahi would have derived no more than .25 percent of its revenues from Cheng Shin’s California sales. Cheng Shin presented evidence that other tire manufacturers sell tires in California that incorporate Asahi valves but there is no indication of the number of such tires or what percentage of Asahi’s total revenues are rep*55resented by such tires. Even assuming that Asahi derives 10 times as much of its revenues from other manufacturers’ California sales as from Cheng Shin’s, a matter of sheer speculation, Asahi would only receive 2.5 percent of its total revenue from California. This miniscule percentage belies any suggestion that Asahi intended to serve the California market indirectly. The assertion that Asahi “knew” that its valves were destined for California is predicated on a slender reed—Cheng Shin’s manager’s second-hand understanding. It seems beyond controversy to me that Asahi at best foresaw that some valves would be sold in California but it in no way purposefully availed itself of conducting business in California nor exerted any effort to serve the California market. Under the teaching of World-Wide Volkswagen Corp., then, I would find that California cannot assert in personam jurisdiction over Asahi.
Nonetheless, the majority opinion argues that Asahi’s indirect business in California is substantial. (Ante, p. 48.) The opinion next equates Asahi’s knowledge that some of its valves would eventually be sold in California with proof that Asahi purposefully availed itself of the benefit of California’s laws.1 The majority concludes, based on those predicates, that Asahi reasonably should have anticipated being haled into court in California and that California may properly exercise jurisdiction over Asahi. (Ante, p. 48.)2 I do not find that analysis persuasive.
Finally, even assuming that minimal contacts exist, I dissent from the conclusion that California may fairly and reasonably exercise jurisdiction. The majority notes that California has an interest in enforcing its safety standards, that most of the evidence is in California, and that the presence of other cross-defendants raises the danger of inconsistent judgments should the Cheng Shin/Asahi dispute be litigated elsewhere. Whatever interest California may have had in asserting jurisdiction over Asahi to enforce its safety standards evaporated when the California plaintiffs settled with all defendants. Even before settlement the California plaintiffs showed no interest in Asahi. Plaintiffs never sought to serve Asahi as an additional defendant although it must have been apparent by August 1982 at the latest *56that Asahi was potentially liable. Further, Cheng Shin waited over a year from the date it was served with the complaint before cross-complaining against Asahi.
True, the evidence is in California but the principal evidence bearing on Asahi’s liability must be the motorcycle tire, an item easily transported to the eventual forum. Although other cross-defendants do remain, Asahi and Cheng Shin presumably entered into a sales contract which may contain terms that are unenforceable in California but which are proper under the laws of Japan or Taiwan. Certainly they did not expect their relationship, inter se, to be governed by California. Any disadvantage to the other cross-defendants is balanced by the disadvantage of having California law applied, essentially randomly, to the dispute between Asahi and Cheng Shin.
The net result of the majority’s decision is that a Taiwanese corporation can litigate in California against a Japanese corporation that has absolutely no connection with California in a case in which the California plaintiffs have declared themselves made whole. Surely our overburdened courts should be concerned with disputes that more directly involve California.
I would issue the writ.
Mosk, J., concurred.

The majority’s approach, confusing foreseeability with intent and hence finding efforts to serve the forum’s market, is similar to that posited by Justice Marshall’s dissent in WorldWide Volkswagen Corp. and, obviously, rejected by the majority of the Supreme Court. (See World-Wide Volkswagen, Corp., supra, 444 U.S. at p. 313 [62 L.Ed.2d at p. 511] (dis. opn. of Marshall, J.).)

Gauging the propriety of asserting jurisdiction by whether the party should reasonably expect to be haled into court in the forum is noted in World-Wide Volkswagen Corp. but not exclusively relied upon and results in a logical vicious circle. If a forum routinely asserts jurisdiction, foreign parties will expect to be haled into court there. The more parties expect to be haled into court, the greater the propriety of the forum’s assertions.