Asahi Metal v. Superior Court: Case Brief & Test

Asahi Metal v. Superior Court Explained: Stream of Commerce · Watch on YouTube

The short answer

A Japanese company sold tire-valve parts to a Taiwanese tube maker, knowing some finished tubes would be sold in California. When a motorcycle crash in California led to a lawsuit there, the Taiwanese company tried to pull the Japanese supplier into the case. In Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102 (1987), every Justice agreed California could not exercise jurisdiction over the supplier, and eight agreed that doing so would be "unreasonable and unfair." What they could not agree on is the question students remember the case for: whether putting a product into the "stream of commerce," aware it will reach a state, counts as a minimum contact with that state. For the full personal jurisdiction framework, start with our personal jurisdiction guide; this page is the case brief.

Citation	480 U.S. 102 (1987), No. 85-693
Court	Supreme Court of the United States, on review from the Supreme Court of California, 39 Cal. 3d 35 (1985)
Argued / decided	November 5, 1986 / February 24, 1987
Judgment	Reversed and remanded; no Justice voted to uphold jurisdiction
Majority holding	Part II-B (8 Justices): exercising jurisdiction over Asahi would be unreasonable and unfair under the Due Process Clause
Open question	Whether awareness that a product will reach the forum through the stream of commerce is enough for minimum contacts (Court split 4–4)

Who joined what: reading a fractured decision

Asahi is a case where you have to track the votes part by part. Justice O'Connor announced the judgment, but only some parts of her opinion drew five or more votes.

Opinion / part	Joined by	Votes	What it says
O'Connor, Part I	All Justices	9	The facts and procedural history
O'Connor, Part II-A	Rehnquist, Powell, Scalia	4	Stream of commerce plus: awareness alone is not purposeful availment
O'Connor, Part II-B	Rehnquist, Brennan, White, Marshall, Blackmun, Powell, Stevens	8	Jurisdiction would be unreasonable and unfair (opinion of the Court)
O'Connor, Part III	Rehnquist, Powell, Scalia	4	No minimum contacts; reverse
Brennan, concurring in part and in the judgment	White, Marshall, Blackmun	4	Agrees with II-B; awareness is enough for minimum contacts
Stevens, concurring in part and in the judgment	White, Blackmun	3	II-B decides the case; II-A was unnecessary and misapplied

Two points trip students up. First, Justice Scalia joined Part II-A but not Part II-B, which is why the fairness holding has eight votes rather than nine. Second, Justices White and Blackmun joined both the Brennan and the Stevens opinions, so counting "sides" on stream of commerce gives you 4 (O'Connor) versus 4 (Brennan), with Stevens declining to choose.

Facts: from a valve factory in Japan to a highway in California

On September 23, 1978, Gary Zurcher lost control of his Honda motorcycle on Interstate 80 in Solano County, California. He was severely injured, and his wife, Ruth Ann Moreno, who was riding as his passenger, was killed. Zurcher sued in California state court, claiming the rear tire, tube, and sealant were defective. One defendant was Cheng Shin Rubber Industrial Co., the Taiwanese maker of the tube.

Cheng Shin filed a cross-complaint seeking indemnity from Asahi Metal Industry Co., the Japanese company that made the tube's valve assembly. Zurcher's own claims later settled, which left only Cheng Shin's indemnity claim against Asahi.

Link in the chain	What the record showed
Asahi (Japan)	Made valve assemblies in Japan; sold them to Cheng Shin and other tire makers. Sales took place in Taiwan, with shipments from Japan to Taiwan.
Volume	150,000 assemblies in 1978; 500,000 in 1979; 500,000 in 1980; 100,000 in 1981; 100,000 in 1982
Importance to Asahi	Sales to Cheng Shin were 1.24% of Asahi's income in 1981 and 0.44% in 1982
Cheng Shin (Taiwan)	Sold finished tubes worldwide; alleged that about 20% of its U.S. sales were in California
California	Asahi had no office, agents, employees, or property there, and did not advertise or solicit business there

Asahi's president declared that Asahi "has never contemplated that its limited sales of tire valves to Cheng Shin in Taiwan would subject it to lawsuits in California." Cheng Shin, for its part, pointed to evidence that tubes with Asahi valves were sitting on California store shelves.

How the case reached the Supreme Court

Asahi moved to quash Cheng Shin's service of summons, arguing that California could not exercise jurisdiction over it consistent with the Due Process Clause of the Fourteenth Amendment. California's long-arm statute reaches as far as the Constitution allows, so the only question was constitutional.

The Superior Court denied the motion. The California Court of Appeal ordered the summons quashed. The Supreme Court of California reversed, holding that Asahi's intentional act of placing its valves into the stream of commerce, combined with its awareness that some would reach California, was enough. The U.S. Supreme Court granted certiorari and reversed.

The two questions, and how the Court answered each

Question 1: Minimum contacts. Does a foreign component maker purposefully avail itself of a state when it sells parts abroad, knowing the finished products will be sold there? No majority answer. Four Justices said no; four said yes; three said the Court didn't need to decide.

Question 2: Fairness. Even assuming minimum contacts, would exercising jurisdiction comport with "fair play and substantial justice"? No, said eight Justices in Part II-B. That holding is the binding part of the case, and it is why Asahi is one of the rare decisions where reasonableness alone defeated jurisdiction.

The competing stream-of-commerce tests

Stream of commerce plus (O'Connor, for four)

"The placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State."

The "more" can include "designing the product for the market in the forum State, advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum State."

Pure stream of commerce (Brennan, for four)

"The stream of commerce refers not to unpredictable currents or eddies, but to the regular and anticipated flow of products from manufacture to distribution to retail sale."

"As long as a participant in this process is aware that the final product is being marketed in the forum State, the possibility of a lawsuit there cannot come as a surprise."

The volume approach (Stevens, for three)

Whether conduct rises to purposeful availment "is affected by the volume, the value, and the hazardous character of the components." Stevens added: "In most circumstances I would be inclined to conclude that a regular course of dealing that results in deliveries of over 100,000 units annually over a period of several years would constitute “purposeful availment,” even though the item delivered to the forum State was a standard product marketed throughout the world."

The heart of the disagreement is one sentence from Part II-A: "a defendant's awareness that the stream of commerce may or will sweep the product into the forum State does not convert the mere act of placing the product into the stream into an act purposefully directed toward the forum State." Applying that test, O'Connor's plurality found no purposeful availment, because Asahi did not create, control, or employ the distribution system that brought its valves to California. Brennan's group would have found minimum contacts based on Asahi's regular and extensive sales to a manufacturer it knew was selling in California.

The fairness test that actually decided the case

Part II-B applied the reasonableness factors from World-Wide Volkswagen. "A court must consider the burden on the defendant, the interests of the forum State, and the plaintiff's interest in obtaining relief. It must also weigh in its determination “the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social policies.”"

Factor	Applied to Asahi
Burden on the defendant	Severe. Asahi would have to litigate across an ocean and submit its dispute with Cheng Shin to a foreign judicial system.
Forum State's interest	Slight. Cheng Shin was not a California resident, and the remaining claim was about indemnity, not consumer safety.
Plaintiff's interest in relief	Slight. Nothing showed California was more convenient for Cheng Shin than Taiwan or Japan.
Efficient resolution	Not separately weighed; the Court's analysis turned on the burden and the weak interests on the other side.
Shared policies (here, international interests)	Courts must consider the interests of other nations and the federal government's foreign relations when reaching a foreign defendant.

Two lines from Part II-B are worth knowing. On burden: "The unique burdens placed upon one who must defend oneself in a foreign legal system should have significant weight in assessing the reasonableness of stretching the long arm of personal jurisdiction over national borders." On the bottom line: "Considering the international context, the heavy burden on the alien defendant, and the slight interests of the plaintiff and the forum State, the exercise of personal jurisdiction by a California court over Asahi in this instance would be unreasonable and unfair." The Court also noted that the remaining dispute was mainly about indemnification, not the safety of consumers.

Where Asahi came from, and where the question went

Before: World-Wide Volkswagen v. Woodson (1980). The stream-of-commerce idea came from this case. The Court said a state may assert jurisdiction "over a corporation that delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum State." It also framed the inquiry around whether the defendant "should reasonably anticipate being haled into court there." Asahi's split is over what that "expectation" requires.

After: J. McIntyre Machinery, Ltd. v. Nicastro (2011). An English manufacturer sold a metal-shearing machine through a U.S. distributor; it injured a worker in New Jersey. The Court held 6–3 that New Jersey lacked jurisdiction, but again without a majority rationale. Justice Kennedy's four-Justice plurality took the stricter view: "The defendant's transmission of goods permits the exercise of jurisdiction only where the defendant can be said to have targeted the forum; as a general rule, it is not enough that the defendant might have predicted that its goods will reach the forum State." Justice Breyer, joined by Justice Alito, concurred in the judgment on narrower grounds, and Justice Ginsburg dissented for three.

Same day: Goodyear Dunlop Tires Operations v. Brown (2011). Writing for the Court, Justice Ginsburg limited the stream of commerce to specific jurisdiction: "Flow of a manufacturer's products into the forum, we have explained, may bolster an affiliation germane to specific jurisdiction." It does not make a defendant subject to general, all-purpose jurisdiction in the state.

Case	Defendant and forum	Result	Stream-of-commerce takeaway
World-Wide Volkswagen (1980)	New York car dealer and regional distributor; Oklahoma	No jurisdiction	Delivering products with the expectation they'll be bought in the forum can support jurisdiction
Asahi (1987)	Japanese component maker; California	No jurisdiction (unreasonable)	Split 4–4 between "plus" and "pure" stream of commerce
J. McIntyre v. Nicastro (2011)	English machine maker; New Jersey	No jurisdiction	Plurality requires targeting the forum; still no majority test
Goodyear v. Brown (2011)	Foreign tire subsidiaries; North Carolina	No general jurisdiction	Stream of commerce supports specific jurisdiction only

How Asahi shows up on exams

Asahi is the case to cite whenever a fact pattern has a manufacturer (often a foreign one) that sells to a middleman, with the product ending up in the forum through someone else's distribution network. Professors use it to test two skills: running the stream-of-commerce analysis when there is no majority rule, and doing the fairness analysis as a separate step.

For minimum contacts, apply both tests and say whether the answer changes. Under O'Connor's test, look for the "plus" factors: forum-specific design, advertising, customer service, or a forum sales agent. Under Brennan's test, ask whether the defendant knew the product was regularly marketed in the forum. Mention Stevens's volume point when the numbers are large, and note that McIntyre's plurality took the stricter view without settling the question.

For fairness, walk through the factors and compare the facts to Asahi. Asahi's facts were extreme: a foreign defendant, a foreign plaintiff, and a leftover indemnity claim. When an injured forum resident is suing, the forum's interest is much stronger, and fairness is far less likely to defeat jurisdiction. If the defendant is subject to jurisdiction but the forum is inconvenient, consider venue transfer and forum non conveniens as separate tools.

Don't stop at personal jurisdiction. A complete answer also confirms the court has subject-matter jurisdiction, since the two are independent requirements.

Practice hypo (with a worked answer)

The facts. VoltCell, a company based in Germany, makes lithium battery cells. It sells about 300,000 cells a year, in Germany, to an e-bike assembler based in Taiwan. The assembler sells finished e-bikes to U.S. retailers, and VoltCell's sales team knows that roughly 8% of the bikes are sold in Ohio. VoltCell has no office, employees, or advertising in Ohio. An Ohio resident is burned when an e-bike battery ignites in her Ohio garage. She sues the assembler and VoltCell in Ohio state court. VoltCell moves to dismiss for lack of personal jurisdiction.

Variation. Same facts, except VoltCell also certified its cells under a safety standard that only one Ohio-based retailer requires, and it pays a sales representative to visit that retailer each quarter.

Worked answer, original facts. Under O'Connor's stream-of-commerce-plus test, VoltCell's awareness that its cells reach Ohio is not enough. It did not design for the Ohio market, advertise there, provide customer service there, or use an Ohio sales agent, so there is no purposeful availment. Under Brennan's test, the result likely flips: VoltCell is part of a regular and anticipated flow of products to Ohio retail sale and knows it. Stevens's approach also points toward jurisdiction, given the large volume over several years and the hazardous nature of the product. Because no majority test exists, a strong answer applies both and notes that McIntyre's plurality favored the stricter view. If contacts are found, the fairness factors likely favor Ohio, unlike in Asahi. The plaintiff is an Ohio resident injured in Ohio, the claim is about product safety, and Ohio has a strong interest in providing a forum. VoltCell's burden as a foreign defendant still matters, but this is not Asahi's leftover indemnity dispute between two foreign companies.

Worked answer, variation. Now VoltCell has done something "more" directed at Ohio: it shaped its product to meet a requirement of an Ohio customer and maintained a regular sales channel there. That satisfies even O'Connor's test, so minimum contacts exist under every approach in Asahi. The fairness analysis is the same as above, and jurisdiction is very likely proper.

The video

The animation at the top of this page runs about four and a half minutes. It follows the valve from Japan to Taiwan to California, lays out the procedural path, and shows the vote split on screen, from the eight-Justice fairness holding to the 4–4 stream-of-commerce divide. For related reading, see the Bell Atlantic v. Twombly case brief, browse all Law School guides, or review the Civil Procedure cheat sheet.

Frequently asked questions

What was the outcome of Asahi Metal Industry Co. v. Superior Court?

The Supreme Court reversed the California Supreme Court and held that California could not exercise personal jurisdiction over Asahi. No Justice voted to uphold jurisdiction. Eight Justices agreed that exercising jurisdiction would be unreasonable and unfair under the Due Process Clause.

Was Asahi a plurality opinion?

Partly. Part II-B, holding that jurisdiction would be unreasonable, was an opinion of the Court joined by eight Justices. Part II-A, which set out the stream-of-commerce-plus test, was joined by only four Justices, so it is a plurality opinion. Justice Brennan wrote for four Justices who rejected it, and Justice Stevens wrote for three who found it unnecessary.

What is the stream of commerce plus test?

It is Justice O'Connor's test from Part II-A of Asahi. Placing a product into the stream of commerce, even knowing it will reach the forum, is not enough. The defendant must also do something aimed at the forum, such as designing the product for that market, advertising there, setting up customer service there, or using a forum sales agent.

Is stream of commerce enough for personal jurisdiction?

The Supreme Court has never settled this. In Asahi, four Justices said awareness is not enough and four said it is. In J. McIntyre Machinery v. Nicastro (2011), a four-Justice plurality required that the defendant target the forum, but again there was no majority. Goodyear v. Brown (2011) held that the stream of commerce cannot support general jurisdiction.

When was Asahi decided?

Asahi was argued on November 5, 1986, and decided on February 24, 1987. The citation is 480 U.S. 102 (1987).

Why did the Court find jurisdiction unreasonable in Asahi?

The burden on Asahi, a Japanese company forced to defend in a foreign legal system, was severe. California's and Cheng Shin's interests were slight, because Zurcher's claims had settled and all that remained was an indemnity dispute between two foreign companies about a sale made in Taiwan.

Related Verbloom guides

Personal Jurisdiction Explained Venue, Transfer, and Forum Non Conveniens Subject-Matter Jurisdiction Bell Atlantic v. Twombly Case Brief

Sources

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