International Shoe Co. v. Washington

Brief Fact Summary.

Washington attempts to tax a corporation incorporated in Delaware with its headquarters in Saint Louis but the corporation refuses to pay. Washington state wins.

Synopsis of Rule of Law.

Due Process requires only that in order to subject a defendant to personal jurisdiction, if the defendant is not present within the forum, that the defendant have certain minimum contacts with the forum such that the maintenance of the suit does not offend “traditional notions of fair play and substantial justice”.

Facts.

Defendant corporation is in the business of selling and manufacturing shoes. Defendant is incorporated in Delaware and has its principal place of business in St. Louis, Missouri. Defendant corporation employs 11-13 salesmen that sell samples in Washington, live in Washington, but are under direct control of the managers in St. Louis. The salesmen are not authorized to enter into contracts or make collections, but must send the orders to St. Louis for acceptance or rejection, upon which, if accepted, the merchandise is shipped from out of state into Washington. Plaintiff, State of Washington, maintains a fund that requires corporations doing business in Washington to pay into. Defendant corporation failed to make payments and Plaintiff state serves Defendant corporation with process to its sales solicitor in Washington and mails a copy to Defendant’s St. Louis address.

Issue.

Does a court have personal jurisdiction over a defendant having minimum contacts with a forum state within limitations of the Fourteenth Amendment?

Held.

Yes, a forum state has personal jurisdiction over a defendant with minimum contacts within that forum state within the limitations of the Fourteenth Amendment. Decision of the lower courts affirmed.

Dissent.

.

Concurrence.

Justice Justice Black Concurring

Due process is not broad enough to prevent a forum state from taxing corporations just because their headquarters is elsewhere, but the court’s use of “justice, fair play, and reasonableness” is not warranted by the Constitution. The Court’s decision to relate jurisdiction with minimum contacts will take away from a state’s ability to give judicial protection to its citizens.

Discussion.

1. It is a legal fiction of a corporation that it must consent to service and a suit. Its consent is implied from its presence in a forum state and through its authorized agents that act in the forum state.
2. Whether due process is satisfied depends on the quality and nature of the activity in relation to the fair and orderly administration of the laws.
3. The activities of the corporation were not irregular or casual, rather systematic and continuous and the business engaged in substantial interstate commerce.
4. To the extent a corporation exercises the privilege of conducting activities in the state, it enjoys the benefits and protection of the laws of that state. This privilege gives rise to obligations, and asking them to respond to a suit is not an undue burden.
5. For personal jurisdiction to be proper a defendant must (1) have minimum contacts and (2) the claim must relate to those minimum contacts.