International Shoe v. Washington

SCOTUSCase
Litigants=International Shoe Co. v. Washington
ArgueDate=November 14
ArgueYear=1945
DecideDate=December 3
DecideYear=1945
FullName=International Shoe Company v. State of Washington, Office of Unemployment Compensation & Placement, et al.
USVol=326
USPage=310
Citation=66 S. Ct. 154; 90 L. Ed. 95; 1945 U.S. LEXIS 1447; 161 A.L.R. 1057
Prior=Special appearance by appellant in Washington state court as defendant in lower court; appellant moved to set aside order on grounds of lack of personal jurisdiction; tribunal denied motion; state Superior Court affirmed; state Supreme Court affirmed
Subsequent=
Holding=Suit cannot be brought against an individual unless they have minimum contacts with the forum state, and such lawsuit does not offend traditional notions of fair play and substantial justice.
SCOTUS=1945-1946
Majority=Stone
JoinMajority=Reed, Frankfurter, Douglas, Murphy, Rutledge, Burton
Concurrence=Black
NotParticipating=Jackson
LawsApplied=U.S. Const.
26 U.S.C. § 1606
Washington Unemployment Compensation Act

"International Shoe Co. v. Washington", 326 U.S. 310 (1945) [caselaw source
case="International Shoe v. Washington", 326 U.S. 310 (1945)
enfacto=http://www.enfacto.com/case/U.S./326/310/
findlaw=http://caselaw.lp.findlaw.com/scripts/getcase.pl?navby=CASE&court=US&vol=326&page=310] , was a landmark decision of the United States Supreme Court holding that a civil defendant could not be subjected to personal jurisdiction by the courts of a state unless that the defendant had certain minimum contacts with that state.

Facts

The plaintiff, responsible for filing this suit in the State of Washington, established a tax on employers doing business therein. The "tax" was a mandatory contribution to the state's Unemployment Compensation Fund. The defendant, International Shoe, was a company that was incorporated in Delaware with its principal place of business ("PPB") in Missouri. The corporation had maintained for some time a staff of 11-13 salesmen in Washington who were residents of that state, and who occasionally rented space to put up displays, as well as met with prospective customers in motels and hotels, thus having no permanent "situs" of business in the State.International Shoe did not pay the tax, so the state effected service of process on one of their salesmen with a notice of assessment. Washington also sent a letter by registered mail to their place of business in Missouri. International Shoe made a special appearance at the trial court to dispute the state's jurisdiction over it as a corporate "person." Personal jurisdiction was upheld in the trial court and the Supreme Court of Washington, so International Shoe Co. appealed to the U.S. Supreme Court.

The Supreme Court could have upheld jurisdiction over the corporation, International Shoe Co., based on a growing body of incremental statutory and common law doctrines, which had been evolving since 1877 ("Pennoyer v. Neff") through 1927 (out-of-state motorist statutes; i.e. "Hess v. Pawloski"). Those doctrines were built upon the "presence" of the defendant within the forum state, or the defendant's commission of an act within the forum state. (A "forum state" means the state in whose courts a case is being litigated.) The Court's majority chose, rather, to create a new doctrine, while still adhering to a "presence" rationale. The basic formulation is: A state may exercise personal jurisdiction over an out-of-state defendant, so long as that defendant has "sufficient minimum contacts" with the forum state, such that the exercise of jurisdiction "will not offend traditional notions of fair play and substantial justice . . ." See 326 U.S. 310 (1945).

It was and remains a broad doctrine. It eventually allowed states to create "long arm" statutes and responded to the actualities of the national market of the United States. Defendants had often avoided their legal responsibilities by "scampering" from the state of occurrence and not being available for service of process. The case changed that to some extent, though the "traditional notions of fair play and substantial justice" are drawn from the Due Process Clause of the Fourteenth Amendment and Aristotle's notions of justice. The doctrine of International Shoe is broad, but the Court has recognized that it has limits, nonetheless.

Issue

What level of connection must exist between a non-resident corporation and a state in order for that corporation to be sued within that state?

Result

The Supreme Court, in an opinion by Chief Justice Harlan Fiske Stone, held that the Fourteenth Amendment requires that a defendant cannot be brought before a court of a particular state unless that person has::Minimum contacts . . . such that maintenance of the suit does not offend "traditional notions of fair play and substantial justice."

Jurisdiction was appropriate in this case because International Shoe Co. engaged in substantial activities in the state of Washington, enjoyed the benefits and protections of the state of Washington through the ability to sell there, and had access to Washington’s courts to resolve its disputes.

Concurrence

Justice Hugo Black wrote a separate opinion, agreeing with the outcome in this case, but contending that the Court has excessively restricted the power of states to find jurisdiction over companies doing business therein.

ee also

*List of United States Supreme Court cases, volume 326

References