Court Opinion

ID: 6914517
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:36:19.906134+00
Date Added: 2024-06-11T16:06:37.160025
License: Public Domain

WOODBURY, Circuit Judge
(concurring).
I think it helpful to distinguish sharply between the two questions of law involved in cases like this: 1) the preliminary question to be decided by application of state law and, 2) the further question, if presented, to be decided by application of federal constitutional law. Judge Goodrich of the Court of Appeals for the Third Circuit sitting on this Court by assignment did this clearly and concisely in Pulson v. American Rolling Mill Co., 1 Cir., 1948, 170 F.2d 193, 194, wherein he said:
“There are two parts to the question whether a foreign corporation can be held subject to suit within a state. The first is a question of state law: has the state provided for bringing the foreign corporation into its courts under the circumstances of the case presented? There is nothing to compel a state to exercise jurisdiction over a foreign corporation unless it chooses to do so, and the extent to which it so chooses is a matter for the law of the state as made by its legislature. If the state has purported to exercise jurisdiction over the foreign corporation, then the question may arise whether such attempt violates the due process clause or the interstate commerce clause of the federal constitution. Const, art. 1, § 8, cl. 3; Amend. 14. This is a federal question and, of course, the state authorities are not controlling. But it is a question which is not reached for decision until it is found that the State statute is broad enough to assert jurisdiction over the defendant in a particular situation.”
In the Pulson case we took the view that the applicable Massachusetts statute as interpreted by the Supreme Judicial Court of that Commonwealth was not broad enough, in view of the limited local activities of the foreign corporation there involved, to subject it to suit in Massachusetts. Thus in that case we did not reach the federal question of the limitation on state power imposed by the due process clause of the Fourteenth Amendment. I think the situation in New Hampshire is different. In my opinion the New Hampshire statute, unlike that of Massachusetts, has not been limited by judicial decision to restrict the scope of state power short of federal constitutional bounds.
Campbell v. United States Radiator Corp., 1933, 86 N.H. 310, 167 A. 558, and Grace v. Procter & Gamble Co., 1948, 95 N.H. 74, 57 A.2d 619, certainly indicate unmistakably that in New Hampshire foreign corporations are subject to local jurisdiction up to the limits imposed upon state action by the due process clause of the Fourteenth Amendment. Perhaps *124some rather ambiguous language used in deciding the later cases of Taylor v. Klen-zade Products, Inc., 1952, 97 N.H. 517, 92 A.2d 910, and LaBonte v. American Mercury Magazine, Inc., 1953, 98 N.H. 163, 96 A.2d 200, 38 A.L.R.2d 742, can be interpreted as casting some doubt upon the holding of the earlier Campbell and Grace cases. But in the later Taylor and LaBonte cases the court did not purport to overrule, indeed it did not even, except possibly by innuendo, cast doubt upon the holding of the earlier cases cited above. As I read the four cases together, I think it reasonably clear that New Hampshire has not departed from its original interpretation of the local statute as exerting jurisdiction over foreign corporations up to the constitutional limit. This, on my analysis, disposes of the question of state law and brings up the question of federal law, i. e. what limitation does the due process clause impose on the state in this regard?
The International Shoe case cited and discussed by my associates provides the answer to this question. In that case, as Chief Judge Magruder points out, the Court departed from the rationale of earlier cases and held that the test of due process in this context is whether the nature and extent of a foreign corporation’s local activities are of sufficient extent to subject it to local jurisdiction without giving offense to “traditional notions of fair play and substantial justice.” [326 U.S. 310, 66 S.Ct. 158]
I suggest that application of the test of “fair play and substantial justice” calls for reference to the specific interests in conflict in each particular case. Thus in this case I think we should Weigh on the one hand the legitimate interests of the state, 1) in providing local access to compensation for wrongs done to its citizens, and, 2) in regulating potentially harmful activity within the state, as against, on the other hand, the legitimate interests of the foreign corporation relative, 1) to its reasonable expectations as to the laws and liabilities to which it was subjecting itself, and, 2) to its opportunity to defend itself without undue expense and inconvenience.
In this case the foreign corporation was promoting by sales force and advertising the use of its commercial poisons in the state of New Hampshire. And it registered its product under the New Hampshire Economic Poisons Law. Clearly then it not only hoped but also anticipated that its product would be used in the state. Furthermore, it certainly must have realized that the poisonous nature of its'product created an appreciable risk of injury to persons in the state, even though the amount used, its value and the number of local users was relatively small. Under these circumstances I cannot think it unfair or unjust to subject the defendant to local jurisdiction. Furthermore, the factors enumerated indicate that the state’s interest in subjecting the defendant to local jurisdiction is substantial.
It is true that there is no clear showing that the plaintiff’s use of Super Ad-It was the result -of the defendant’s promotional activity in the state. But it does not logically follow that the fairness of exercising local jurisdiction over the defendant should be determined by the fortuitous factor of the plaintiff’s state of mind when he bought the product. This factor relates more logically to fairness to the plaintiff of denial of jurisdiction. Rather the fairness to the foreign corporation is more logically related to what it might reasonably have expected as a result of its local activities.
In this case the use of the defendant’s product in New Hampshire was certainly expected by the defendant since it had actively promoted that use in the state. And it was hardly an unforeseeable consequence of that use that the defendant would incur local legal liabilities. These considerations, coupled with the District Court’s finding that no undue inconvenience or expense would be cast upon the defendant in defending this action in New Hampshire, lead me to the conclusion that to subject it to local jurisdiction does no violence to “traditional notions of fair play and substantial justice.”