Thursday, February 7, 2013

International Shoe v. Washington case brief

International Shoe v. Washington
326 U.S. 310 (1945)



PROCEDURAL HISTORY: Appellant corporation sought review, on U.S. Const. amend. XIV due process grounds, of a judgment from the Supreme Court of Washington that affirmed the denial of appellant's motion to dismiss an order and notice of assessment of delinquent contributions entered by appellee state pursuant to § 14(c) of the Washington Unemployment Compensation Act, Wash. Rev. Stat. § 9998-114(c) (1941).

FACTS: Appellee state sought to collect from appellant corporation a deficiency in the payment of contributions to the state unemployment compensation fund. Appellee personally served appellant's salesman with notice of the suit and mailed a copy of the notice to appellant's out-of-state headquarters.

HOLDING:
Holding that the systematic and continuous activities carried on in-state by appellant's salesmen made it reasonable and just to permit appellee to enforce the tax by suit against appellant in the forum, the court affirmed.

ANALYSIS:
The court held that in order to subject appellant to a judgment in personam, due process required only that appellant have certain minimum contacts with the forum state such that the maintenance of the suit did not offend traditional notions of fair play and substantial justice. The court also held that a corporation was deemed to have a "presence" in a state for jurisdictional purposes where its in-state activities had been continuous and systematic and gave rise to the liability sued on. The court held that the activity of appellant's salesmen was not only substantial, but also gave rise to the obligation to contribute to the unemployment compensation fund.

RULES:
Due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.

CONCLUSION: Judgment affirming the denial of appellant corporation's motion to dismiss an order and notice of assessment of delinquent contributions entered by appellee state was affirmed. The conduct of appellant corporation's salesmen in soliciting business in the forum state was sufficient minimum contact with the state to subject appellant to suit for a liability to the state unemployment compensation fund that arose out of that conduct.

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2 comments:

  1. International Shoe Co. v. Washington (US 1945) – State of Washington established tax for employers operating within its boundaries to contribute to an unemployment fund. Washington sues the Company in Washington court to recover unpaid taxes. The Company makes a “special appearance” to challenge jurisdiction. International Shoe. Co. was incorporated in Delaware and its PPB was Missouri. The Company had 11-13 salesmen working in Washington on commission. The salesmen were residents of the state but met with prospective customers in hotels; there was no permanent business site within the State. Furthermore all sales and payments were made directly with the Missouri Office.

    a. Holding: Washington has personal jurisdiction over International Shoe Company.

    b. Rule: “Since the corporation personality is a fiction, it is clear that unlike an individual, its presence can be manifested by activities on its behalf.” “Due process requires that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the form, he has certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Non-present Ds must have minimum contacts w/ the forum state in order for due process to be met.

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  2. nternational Shoe v. Washington:
    i. MINIMUM CONTACTS TEST
    ii. Supreme court rejected the old “physical presence test”
    iii. “Due Process requires only that in order to subject a defendant to personal jurisdiction, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice
    iv. That defendant had to have certain minimal contacts with the forum so that exercising jurisdiction does not offend traditional notions of fair play and substantial justice
    v. Mentioned some factors to consider:
    1. Look at extent of defendant’s activities in that state
    a. Is it continuous
    2. Balance of inconvenience
    a. How inconvenient for both defendant and plaintiff
    3. Connection between cause of action and contacts with the state
    4. Quality and nature of contacts in state
    5. If accepting benefits of doing business in State, not unfair to be subjected to a lawsuit in that state
    6. State’s interests in applying state law
    7. Foreseeable that lawsuit would be filed in that state
    vi. Depends on quality and nature of contacts. Casual or isolates contacts will not suffice
    vii. Thus, a corporation that chooses to conduct activities within a state accepts a reciprocal duty to answer for its in-state activities (chooses to take advantage of benefits and protections
    viii. Power limited to cause of action arising in that state (contacts that spawned lawsuit are the ones most crucial

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