In a development that may have a significant impact on product liability litigation in New Jersey and nationwide, the U.S. Supreme Court has decided to review a recent New Jersey Supreme Court opinion that expanded the "stream-of-commerce" theory for personal jurisdiction. The U.S. Supreme Court's ultimate decision on the appeal may limit the ability of state courts to exercise personal jurisdiction over product companies.
On September 28, 2010, the U.S. Supreme Court granted certiorari in Nicastro et al. v. McIntyre Machinery America Ltd. et al., which involves a personal injury lawsuit against the British manufacturer of an industrial metal cutter. (Click here to read our alert on the Supreme Court's holding in Nicastro.) The New Jersey Supreme Court, in a February 2, 2010, opinion, ruled that although the manufacturer had no presence in or even "minimum contacts" with New Jersey, personal jurisdiction over the defendant was warranted through an expansion of New Jersey's stream-of-commerce theory. A dissent to the Nicastro decision argued that the Court had failed to follow New Jersey's stream-of-commerce precedent, which established that the mere act of placing a product into the stream of commerce was, alone, insufficient to trigger personal jurisdiction.
The U.S. Supreme Court granted certiorari in Nicastro in tandem with its grant of certiorari in a North Carolina Supreme Court case, Goodyear Luxembourg Tires, et al., v. Brown, et al., which also involved the application of a stream-of-commerce theory to a foreign corporation in a product liability case.