Civil Procedure I

Stream of Commerce

Stream of commerce theory permits jurisdiction when the defendant delivers his product into the stream of commerce through a distributor with the expectation that it will be purchased by consumers in the forum state such that he should reasonably anticipate being haled into court there.

There are two rules on the sufficiency of stream of commerce:

  1. McIntyre Rule

    In J. McIntyre, Ltd. v. Nicastro, the Supreme Court had a 4/2/3 split on stream of commerce.

    The plurality view was that stream of commerce alone is not enough to constitute purposeful availment.

    Differs from the Asahi Rule, but since McIntyre had no majority, Asahi was not overruled.

  2. Asahi Rule

    In Asahi Metal Industry Co. v. Superior Court, the Supreme Court had a 4/4 split on stream of commerce.

    The plurality view was that stream of commerce alone is enough to constitute purposeful availment as long as the defendant was aware that the final product was being marketed in the forum state.

    McIntyre disagreed with this, but there was also no majority, so Asahi was not overruled.

Courts will likely begin to lean toward McIntyre rule.

One must check which rule his jurisdiction is following.

Fourth Circuit follows McIntyre. However, it accepts that sufficient contacts exist if a defendant "targeted the forum" with it goods.