“Stream-of-Commerce” - New Jersey Courts’ Personal Jurisdiction Over Foreign Manufacturers in the Contemporary Global Economy
In Nicastro v. McIntyre Machinery America, Ltd., Docket No. A-29-08, 2010 WL 343563, 2010 N.J. LEXIS 19 (N.J. Feb. 2, 2010), decided this month, the New Jersey Supreme Court held that courts in this state can exercise personal jurisdiction over a foreign manufacturer defendant in a product liability action if, based on its nationwide distribution system, the manufacturer has reason to know that its product might end up in New Jersey. In these situations, the Court reasoned, a foreign manufacturer cannot avoid personal jurisdiction by arguing that it did not place the product into the stream of commerce aimed directly at New Jersey. Rather, the Court held that the state’s jurisdictional rules must keep pace with the modern global economy where it is commonplace for a foreign manufacturer to distribute a product from abroad through middlemen over whom they have no control while targeting the national market as a whole. Where the manufacturer has knowledge, or constructive knowledge based on its distribution to the national market, that its product will find its way to New Jersey consumers, New Jersey courts may exercise personal jurisdiction.
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