# Petition for Writ of Certiorari — Bond v. Octagon Process, Inc.

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_2022%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1991
- **Citation:** 501 U.S. 1232

## Text

NO.

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM 1990
OLIVER BOND AND HERTA BOND
Petitioners
VS:
OCTAGON PROCESS, INC.

Respondent

ON PETITION FOR WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

PETITION FOR WRIT OF CERTIORARI

E. FREEMAN LEVERETT

COUNSEL OF RECORD FOR
PETITIONERS

HEARD, LEVERETT & PHELPS, P.C.

25 S. THOMAS STREET

P. O. DRAWER 399

ELBERTON, GEORGIA 30635

TEL: 404/283-2651

QUESTIONS FOR REVIEW

(1) Did The Court of Appeals err in
holding that the stream of commerce

theory of in personam jurisdiction as

applied to a manufacturer of a product,
first definitively stated in Gray v.

American Radiator & Standard Sanitary

Corp., 22 Ill. 2d 432, 176 N.E.2d 490
(1980), had been rejected in World-

Wide Volkswagon Corp. v. Woodson, 444

U.S. 286, 100 S. Ct. 559, 62 L. Ed.2d 490

(1980), and Asahi Metal Industry Co.,

Ltd. v. Superior Court of California,

480 U.S. 102, 107 S. Ct. 1026, 94 L.Ed.2d
92 (1987)? Three other Courts of Appeal
have previously held to the contrary.

(2) Did the Court of Appeals err in
upholding the dismissal of petitioners’
complaint under Rule 12(b)(2), FRCP,
rather than directing transfer
to the proper district court in New

~~

Jersey pursuant to 28 USC 1406(a) and

this Court's decision in Goldlawr v.

Heiman, 369 U.S. 463, 466, 82 S. Ct. 913,
8 L.Ed.2d 39 (1962)?

wile

PARTIES TO THE PROCEEDING

All parties to the proceedings in the
District Court and Court of Appeals below
appear in the caption. Petitioners are
not aware that any parent or subsidiary

companies of Respondent exist.

-iii-

TABLE OF CONTENTS

PAGE NO.

QUESTIONS FOR REVIEW.....cceeeeeee i
PARTIES TO THE PROCEEDINGS......-- iii
TABLE OF AUTHORITIES... -ceesseeeee V
REPORTS OF OPINIONS BELOW.....---- 1
JURISDICTION. ..ccccccccccccescseee 1

CONSTITUTIONAL AND STATUTORY
PROVISIONS TNVUUVED ce ccccceessoccsce l

STATEMENT OF THE CASE....ceeeceees 2
REASONS FOR GRANTING THE WRIT..... 6
CO Les 6-06 68 0 eeeeocseeeeeeeees 28

CERTIFICATE OF SERVICE...cecccceee 29

-iv-

TABLE OF AUTHORITIES

CASES PAGE NO.

A.I.M. International, Inc.

v. Battenfeld Extrusion

Systems, Inc., 116 F.R.D.

633, 641 (D.C. Ga. 1987)..... 15

American Greetings Corp. v.
Cohn, 839 F2d 1164, 1167
(6th Gates DT whegseenéeeoen 21

Andel v. Getz Services,
197 Ga. App. 653, 399 SE2d
226 PRs i been ed eae kone & © o @ 24

Asahi Metal Industry Co.,

Ltd. v. Superior Court of

California, 480 U.S. 102,

107 S.Ct. 1026, 94 L.Ed.2d

SS CIPO) acsccceseesceaceeese i, 7, 10
12, 14,
15, 17

Bean Dredging Corp. v.

Dredge Technology Corp.,

744 F2d 1081 (5th Cir.

LORS) cb cic cor ceesecsenseeeces 12, 18,
21

Becker v. Commissioner of

Internal Revenue, 852 F2d

SSG CLESR CEL. BOS) 66 access 27

Bentz v. Recile, 178 F2d
LG26 (SER. CELi BOSS) ccc ceewds 26

Bond v. Octagon Process,
Inc., 745 F. Supp. 710 (D.C.
Ga. EE bck eee ees Wehbe l

Boyle v. United Technologies
Corp., 487 U.S. 500, 108 S.

Ct. 2510, 101 L.Ed.2d 442
(JOSS) wc cvcsccvescesecs eseseee 4

Burton v. Subaru of America,
Inc., 646 F. Supp. 78 (D.C.
Ga. kane eek acne hae oe © 20

Corke v. Sameit M.S. Song
of Norway, 572 F2d 77 (2nd
Giz. Dt 66666068 s 6666660600 26

DeJames v. Magnificience

Carriers, Inc., 654 F2d 280

(3rd Cir. 1981), cert. den.

S56 U.8. 1GG5 (lIPSld ecccccvece 18

Benitez-Allende v. Alcan
Aluminio Do Brasil, S.A.,
857 F2d 26 (lst Cir. (1988).. 18

Dubin v. U.S., 380 F2d 813
(5th Cate fe 26

Goldlawr v. Heiman, 369 U.S.

463, 466, 82 S.Ct. 913, 8

eee 2S CABGCE) cc cccceccccce Si, dhe
22, 27

Gray v. American Radiator &
Standard Sanitary Corp., 22
Ill. 2d 432, 176 N.E.2d 490
(2SSO) cccccccccccccencceccees i, 7, 18

Gulf Consolidated Services
v. Corinth Pipeworkers,S.A.,
898 F2d 1071 (5th Cir. 1990). 17

Haley v. Wright Mfg. Co., 651
F. Supp. 116 (D.C. La. 1986). 19

Hall v. Zambelli, 669 F. Supp.
753 (D.C. W.Va. 1987) ........ 19

Hapaniewski v. City of
Chicago Heights, 883 F2d
576 (7th oy fa : ) rr a 26

-vi-

In re Agent Orange Litigation,
818 F2d 135 (2nd Cir. 1987).. 18

Interfirst Bank Clifton v. “
Fernandez, 844 F2d 279, 282
(Sth Gre « | TG ee ee 21

International Shoe Co. v.
Washington, 326 U.S. 310,
66 S.Ct. 154, 90 L.Ed. 95
SRDS) 0c secs ce eeeessees eaeeees 12

Irving v. Owens-Corning

Fiberglas Corp., 864 F2d

383 (Sth Cir. 1989) .cccccccee 17, 20,
21

Ladwig v. Trust Ins. Exchange,

498 F. Supp. 161 (D.C. Wis.

1980) wcccccccccccccccccccccce 26

Mason v. F. Lli Luigi &
Franco Dal Maschio, 832 F2d
383 (7th Cir, oy 17

Mayo Clinic v. Kaiser,
383 F2d 653, 655 (8th Cir.
DTS 0665666486600 eeeeoeeeee#ee#e#e#e 26

McDaniel v. Johns-Manville
Sales Corp., 487 F. Supp.
714 (D.Ce T11. 1978) ccccsece o° 19

Morris v. SSE, Inc., 843 F2d
See C22E8 CEE. BOSS coc sees “% 15, 2l

National Egg Co. v. Bank
Leumi le-Israel B.M., 504
F. Supp. 305 (D.C. Ga. 1980). 20

Nelson v. Park Industries,

Inc., 717 F2d 1120, 1125-26

(7th Cir. 1983), cert. den. '

S65 GUcGi A2GRe CAS! 0sviceves 11

-vVii-

Omstead v. Brader Heaters,

Ync., 5 Wash. App. 258, 487
P2d 234, 240 (1971)......----.

Oswalt v. Scripto, 616 F2d
191 (5th Cir. 1980)......-.

Panhandle Eastern Pipe Line

Co. v. Federal Power
Commission, 343 F2d 905

(8th Cir. 1965) ...cccccccceee

Payne v. Kristofferson, 631
F. Supp. 39 (D.C. Ga.. 1985).

Pfiffer v. International
Academy, 521 F. Supp. 1331

(D.C. Mo. BOL? o65600066ee008

Porter v. Groat, 840 F2d 255,
258 (4th Cie, |

Ross v. Colorado Outward
Bound School, Inc., 603 F.

Supp. 306 C6. N.Y. 1985) eee

Rowe v. Dorrough, 15C Cal.
App. 3rd 901, 198 Cal.
Rptr. 131 Pan? éee0 see ee

Scott v. Crescent Tool Co.,

296 F. Supp. 147 (D.C. Ga.
| i a

Sells v. International
Harvester Co., 513 F2d 762
(Sth Cir. 1975) reh. den.
S22 PAG LAGS) cccdecccecece

Sinatra v. National Enquirer,
Inc., 854 F2d 1191 (9th Cir.

| ee ee eeeee

~viii-

18

18

27

19

26

26

20

19

18

21

Stoehr v. American Honda
Motor Co., 429 F. Supp. 763
EPute Neb. ogy PPP rrr r rs yer

Tedford v. Grumman American
Aviation Corp., 488 F. Supp.
144 (D.cGi BAGS. THOS? ccovesce<

Thornton v. Toyota Motor
Sales U.S.A., Inc., 397 F.
Supp. 476 (a Ga. 1975) eeee

Tillary v. Idaho Power Co.,
425 F. Supp. 376 (D.C. Wash.
Te & 66k 66Sben eu kewaceeus cer

Value Engineering Co. v.
Gisell, 140 Ga. App. 44,
230 S.B. 24 29 (1976) .ccccces

Westphal v. Mace, 660 F. Supp.
10 oe Ariz. SET? beta wees

World-Wide Volkswagon Corp.
v. Woodson, 444 U.S. 286,

100 S.Ct. 559, 62 L.Ed.2d

490 CLOED) cccccccccccccscccss

STATUTES

Rule 12(b) (2), FRCP........0..
2B USC 1254. cccccccccccccccese
28 USC 1406 (a) ......2e0nne ever

on oe) ean eoeeroee
Constitution of Georgia,

1983, Art. VI, Sec. I, Par.
West 26s 0% eeeees ee rve#eeneense#*#?2s28e#0e28eee#

=e

19

19

26

25

MISCELLANEOUS

63 Am. Jur. 2d 1286, §893..... 20

Maltz, "Unraveling The

Conundrum of the Law of

Personal Jurisdiction: A

Comment On Abahi Metal

Industry Co. v. Superior

Court of California", 1987

Duke L.J. 669, 671 (1987).... ll, 14

Murphy, "Personal Jurisdiction

And The Stream Of Commerce

Theory: A Reappraisal And A.

Revised Approach.” 77 Ky. L.J.

248 (1988-89) ..ccccccccccccces 9, ll,
15

Note, "Personal Jurisdiction:

The Evolution of the Minimum
Contacts Analysis", 20 U. West.
L.A. L.R. 219, 248 (1988-89).. 11

Note, "Personal Jurisdiction

Aftec Asahi: The Other
International Shoe Drops",

55 Tenn. L.R. 41, 92 (1987).. 11

Note, "Jurisdiction, Fair

Play and Foreign Defendants:

Asahi Metal Industry Co. v.
Superior Court", 61 St. John

L.-R. 629, 630 (1987) ..ceeeees 1l
The Supreme Court, 1986 Tern,

101 Harv. L.R. 260, 265

(1987) cccccccccccccccccccoces 15

Van der Creek, “Jurisdiction
Over tthe Person ~ The Progeny
of Pennoyer And The Future of
Asahi", 13 Nova L.R. 1267,

1309 (1969) ccccccccccccccccecs

4 Wright & Miller, Federal

Practice and Procedure,
§1069, at pp. 391-392....... °

_t eo

11

4

REPORTS OF OPINIONS BELOW

The opinion of the District Court is

reported as Bond v. Octagon Process,

Inc., 745 F. Supp. 710 (D.C. Ga. 1990).

The per curiam affirmance of the Court of

Appeals is not reported yet.

JURISDICTION

The decision and judgment of the
Court of Appeals sought to be reviewed
were entered March 28, 1991. Motion for
rehearing was not filed from the per
curiam affirmance. This Court has
jurisdiction of the petition under 28 USC

1254.

CONSTITUTIONAL AND
STATUTORY PROVISIONS INVOLVED

(1) Due Process Clause of the
Fourteenth Amendment to the Constitution

of the United States:

", . .{Nlor shall any state
deprive any person of life, liberty,
Or property, without due process of

law. . .”

(2) 28 USC 1406:

"(a) The district court of a
district in which is filed a case
laying verue in the wrong division
or district shall dismiss, or if it
be in the interest of justice,
transfer such case to any district
or division in which it could have

been brought. * * **

STATEMENT OF THE CASE

Sgt. Oliver Bond was on active duty

at the Elberton, Georgia, National Guard

Armory on December 5, 1982, using a

Cleaning solvent supplied by the

Department of Defense and manufactured by

-2-

respondent Octagon Process, Inc. of
Edgewater, New Jersey. It was 21°F most
of the day, and the combination of the
cold temperature and the defatting and
evaporative cooling of the solvent caused
his hands to contract a disabling
condition known as Raynaud's phenomenon,
which has resulted in the fingers,
particularly on the left hand, to "rot
off". He has now been recognized as
being totally disabled by the Veterans
Administration. Due to initial confusion

1

as to the nature of his condition, this

1. A civilian physician initially
diagnosed the condition as Buerger's
disease, attributed to smoking. This
resulted in Sgt. Bond's being denied any
medical or other benefits for almost 4
years. In late 1985, doctors at
Eisenhower Army hospital reviewed his
case and concluded that the condition was
in fact, service-related, diagnosed as
acquired acrosteolysis-. secondary to
exposure to chemical solvents and cold
environment. This was later changed to
Raynaud's phenomenon.

-3-

diversity of citizenship civil action was
not filed until May 7, 1987. Defendant
Octagon filed Motion to Dismiss, based on
a challenge to jurisdiction over the
person of Octagon by the federal district
court in Georgia, and the governmental
contractor immunity doctrine later
addressed in this Court's decision in

Boyle v. United Technologies Corp., 487

U.S. 500, 108 S.Ct. 2510, 101 L.Ed.2d 442
(1938).

With respect to the challenge to
jurisdiction over the person of
defendant, the evidence showed that
defendant manufactured all of its
products in New Jersey primarily for sale
to the United States, and as to the
solvent in question, all of its
production was for the Defense Logistics
Agency of the Department of Defense. The
solvent was shipped to Department of
Defense depots in Norfolk, Virginia;

-4-

Oakland, California; Mechanicsburg,
Pennsylvania; Columbus, Ohio; Memphis,
Tennessee; Richmond, Virginia; and Ogden,
Utah. No shipments were made by
respondent to Georgia, but as testified
by a contracting officer for the
Department of Defense, "While the
supplying contractors do not know the
ultimate destination of any solvent once
it get3 to a depot, from my experience
all contractors know that the material is
subject to being shipped to Army, Navy
and Air Force bases all over the United
States and its possessions. . .", and to
National Guard Armories. (Ronald L.
Perkinson affidavit). Respondent's
president also indicated knowledge that:
the solvent was distributed by the depots
to other areas. Respondent was the only
manufacturer of the solvent for the
Government during 1982, and one of only

two during 1981.

The district court sustained
respondent's motion to dismiss for lack

of in personam jurisdiction (Appendix 1),

but did not pass upon the governmental
contractor immunity defense.”

The Court of Appeals affirmed per
curiam "on the basis of the district
court's dispositive »~pinion.. ."

(Appendix 2)

REASONS FOR GRANTING THE WRIT

The Court of Appeals has decided an

important question of in personam

jurisdiction contrary to the way in which
the Courts of Appeal for the First, Fifth

and Seventh Circuits have decided it.

2. Petitioner relied upon the exception
recognized by this Court in Boyle, i.e.,
where the "supplier (failed to warn) the
United States about the dangers in the
use of the equipment that were known to
the supplier but not to the United
States” (487 U.S. at 512).

-§-

Under Rule 10 of the Rules of this Court,
that is a reason supporting the grant of
certiorari.

This Court's decision in Asahi Metal

Industry Co. Ltd. v. Superior Court of

California, 480 U.S. 102, 107 S.Ct. 10926,

94 L.Ed.2d 92 (1987), and to a lesser

extent, World-Wide Volkswagon Corp. v.

Woodson, 444 U.S. 286, 100 S.Ct. 559, 62

L.Ed.2d 490 (1980), have created
confusion as to the status of the "stream

of commerce" doctrine of in personam

jurisdiction in products liability ca3es
as applied to manufacturers, first
definitively articulated in Gray v.

American Radiator & Standard Sanitary

Corp., 22 Ill. 2d 432, 176 N.E. 2d 761

3

(1961). "Since Gray v. American

3. "As a general proposition, if a
corporation elects to sell its products
for ultimate use in another State, it is
not unjust to hold it answerable there
for any damage caused by defects in those

-~7-

Radiator & Standard Sanitary Corp.,
American courts have readily asserted
jurisdiction over nonresident
manufacturers and distributors whose

injury-causing products have reached the

products. Advanced means of distribution
and other commercial activity have made
possible these modern methods of doing
business, and have largely effaced the
economic significance of State lines. By
the same token today's facilities for
transportation and communication have
removed much of the difficulty and
inconvenience formerly encountered in
defending lawsuits brought in other
States.

Unless they are applied in
recognition of the changes brought about
by technological and economic progress,
jurisdictional concepts which may have
been reasonable enough in a simpler
economy lose their relation to reality,
and injustice rather than justice is
promoted. Our unchanging principles of
justice, whether procedural or
substantive in nature, should be
scrupulously observed by the courts. But
the rules of law which grow and develop
within those principles must do so in the
light of the facts of economic life as it
is lived today. Otherwise the need for
adaptation may become so great that basic
rights are sacrificed in the name of
reform, and the principles themselves
become impaired." (176 N.E. 2d at 766).

-g-

forum as a result of their purposeful
introduction into the ‘stream of
commerce’. This stream of commerce
concept supports~the forum's exercise of
jurisdiction - although the product's
presence there is the immediate result of
the independent actions and objectives of
intermediaries in the distribution
chain." Murphy, Personal Jurisdiction
And The Stream Of Commerce Theory: A
Reappraisal And A Revised Approach." 77
Ky. L.J. 248 (1988-89).

The Court expressly approved the
doctrine in World-Wide Volkswagon,

supra. Nevertheless, the Court's

4. "The forum State does not exceed its
powers under the Due Process Clause if it
asserts personal jurisdiction over a
corporation that delivers its products
into the stream of commerce with the
expectation that they will be purchased
by consumers in the forum State. Compare
Gray v American Radiator & Standard
Sanitary Corp., 22 Ill 2d 432, 176 NE2d
761 (1961)." (444 U.S. at 297-298). The
dissenting opinions of Justices Brennan,

-9-

Se

holding in that case (to the effect that
jurisdiction could not be asserted in an
Oklahoma Court against a New York Audi
dealer who had sold a vehicle to a New
York resident who drove the car into
Oklahoma and had a wreck, nor against the
New York-based regional distributor) did
raise uncertainty about the scope of
long-arm jurisdiction, and Asahi, supra,

decided in 1987, raised doubts at least in

£.n. 4 continued... Blackmun and
Marshall obviously agreed with this
proposition. Nevertheless, although
World-Wide involved the different factual
situation of a local car dealer and a
regional distributor and not a
manufacturer, some language of the Court
concerning the "fortuitous circumstance
that a single Audi automobile, sold in
New York to New York residents, happened
to suffer an accident while passing
through Oklahoma" (444 U.S. at 295), and
the discussion of forseeability and a
defendant's "purposefully availing itself
of the privilege of conducting activities
within the forum state .. ." (444 U.S.
at 295-297), generated some doubt as to
jurisdiction.

-10-

che minds of commentators as to the
continued viability of the stream of
commerce theory.”

World-Wide Volkswagon, as the Court

of Appeals for the Seventh Circuit

recognized in Nelson v. Park Industries,

Inc., 717 F2d 1120, 1125-26 (7th Cir.
1983), cert. den. 465 U.S. 1024 (1984),
turned upon the fact that the suit there

was against a retail dealer and regional

5. Murphy, supra; Maltz, "Unraveling The
Conundrum of the Law of Personal
Jurisdiction: A Comment On Asahi Metal.
Industry Co. v. Superior Court of
California", 1987 Duke L.J. 669, 671
(1987); Van der Creek, "Jurisdiction Over
The Person - The Progeny of Pennoyer And
The Future of Asahi", 13 Nova L.R. 1287,
1309 (1989); Note, “Personal Jurisdiction:
The Evolution of the Minimum Contacts
Analysis", 20 U. West. L.A. L.R. 219, 248
(1988-89); Note, “Personal Jurisdiction
After Asahi: The Other International

Shoe Drops", 55 Tenn. L.R. 41, 92 (1987);
Note, "Jurisdiction, Pair Play and Foreign
Defendants: Asahi Metal Industry Co. v.
Superior Court", 61 St. John L.R. 629,

630 (1987) (Observing that the stream of
commerce theory had been recognized bv a
majority of the Circuits).

-ll-

distributor, and not the manufacturer or
a national distributor. See Bean

Dredging Corp. v. Dredge Technolo
ging Sorp. 4g gy

Corp., 744 F2d 1081 (5th Cir. 1984).
Respondent argued below, and the
District Court so held (which was adopted

by the Court of Appeals) Opinion, p. 9
(Appendix 1) that the Court in Asahi
expressly disapproved of the stream of
commerce basis of jurisdiction as applied
to a manufacturer. That clearly is not
correct. Asahi was decided instead on
the second of the two prongs of the

International Shoe Co. v. Washington, 326

U.S. 310, 66 S. Ct. 154, 90 L.Ed 95
(1945) jurisdictional test relating not
to the sufficiency of minimum contacts,
but to the proposition that "the
maintenance of the suit does not offend
traditional notions of fair play and
substantial justice” (326 U.S. at 316).
~12-

Justice O'Connor's opinion for herself
and three other members of the Court did
arguably reject stream of commerce in its
pristine form, although seeming to
recognize a modified version of the

principle.® The factual situation in

6. "The placement of a product into the
stream of commerce, without more, is rot
an act of the defendant purposefully
directed toward the forum State.
Additional conduct of the defendant may
indicate an intent or purpose to serve
the market in the forum State, for
example, designing the product for the
market in the forum State, advertising in
the forum State, establishing channels
for providing regular advice to customers
in the forum State, or marketing the
product through a distributor who has
agreed to serve as the sales agent in the
forum State. But a defendant's awareness
that the stream of commerce may or will
sweep the product into the forum State
does not convert the mere act of placing
the product into the stream into an act
purposefully directed toward the forun
State.” (480 U.S. at 112). The present
case, it is submitted, satisfies this
modified standard, for here defendant
availed itself of the nation-wide and
world-wide distribution system of the
Department of Defense, by manufacturing
the solvent solely for Vefense Logistics
Agency, and shipping it to 7 depots

-1]13-

Asahi dictated the result in that case,
in that there, the damage suit by the
forum based motorcycle driver injured
from a tire blow-out had been settled,
and the only dispute remaining was a
question of contribution between two
defendants, a Taiwanese manufacturer of
the tube and the Japanese manufacturer of
the valve assembly used in the tube,
neither of which had any connection with
the forum, California. An additional
factor in Asahi was the presence of
international commerce and the
implication for foreign relations.

480 U.S. at 114-116; Maltz, supra, 1987

Duke L.J. at 679; The Supreme Court,

1986 Term, 101 Harv. L.R. 260, 265

f.n. 6 continued. .. located in 6
widely separated states, knowing that it
would in turn be shipped all over the
nation and the world.

~14-

(1987); Murphy, supra, 77 Ky. L.R. at 274

(1988-89); A.I.M. International, Inc. v.

Battenfeld Extrusion Systems, Inc., 116

P.R.D. 633, 641 (D.C. Ga. 1987).

In Morris v. SSE, Inc., 843 F2d 489

(llth Cir. 1988), the Eleventh Circuit
observed that the status of the

"stream of commerce” doctrine was
uncertain after Asahi, but proceeded to
hold in that case that jurisdiction was
satisfied under either theory espoused in
Asahi. Now, however, the Court of
Appeals has, by adopting the district
court decision, flatly held that stream
of commerce as applied to a manufacturer
has been discredited by Asahi. It is
submitted that such is not the case.
Justice Brennan with three other justices
in Asahi expressly asserted the continued
vitality of the principle, and Justice
Stevens' special concurrence seems to

-15-

EEE

lean toward the Brennan opinion on this
point by (1) rejecting the linch-pin of
Justice O'Connor's rationalization, i.e.,
the "purposefully availing" requirement
and (2) in his insistence that there is
not necessarily any distinction between
"purposefully availing” and "mere

awareness" (480 U.S. at 122)./

7. The "purposeful availment" twist to
in personam jurisdiction under minimum
contacts was added by Hanson v. Denckla,
357 U.S. 235, 253, 78 S. Ct. 1228, 2
L.Ed.2d 1283 (1958), but Justice
Brennan's opinion for the Court in Burger
King Corp. v Rudewicz, 471 U.S. 462, 168
a: 7° 22 Oa 85 L.£d.2d 528 (1985), makes
Clear that the elements of "stream of
commerce" also satisfy the purposeful
availment gloss. See 471 U.S. at

- , where after referring to a
defendant purposefully directing his
activities toward the forum, Justice
Brennan declares: "Thus ‘(t]he forum
State does not exceed its powers under
the Due Process Clause if it asserts
personal jurisdiction over a corporation
that delivers its products into the
stream of commerce with the expectation
that they will be purchased by consumers
in the forum State” and those products
subsequently injure forum consumers.
World-Wide Volkswagon Corp. v. Woodson,

-~l16-

It is respectfully submitted that:
the Courts below erred in refusing to
follow the stream of commerce doctrine
under the facts here, which as stated
previously, satistied even the modified
O'Connor version. On the other hand,
three other Circuits, the Pirst, Pifth
and Seventh Circuits, have held that
"stream of commerce" survives Asahi. As

to the Pifth Circuit, see Irving v.

Owens-Corning FPiberglas Corp., 864 F2d

383 (Sth Cir. 1989); Gulf Consolidated

Services v. Corinth Pipeworkers, S.A.,

898 F2d 1071 (5th Cir. 1990). The
Seventh and First Circuits also have
either upheld or applied the stream of
commerce theory of jurisdiction after

Asahi. Mason v. PF. Lii Luigi & Franco

f,n. 7 continued... supra..." See
also, Justice White's opinion in
World-wide, which says that stream of
commerce satisfies the purposefully
availing requirement. (444 U.S. at 297).

-l7-

a

Dal Maschio, 832 F2d 383 (7th Cir. 1987)

(citing Gray, and Benitez-Ailende v.

Alcan Aluminio Do Brasil, S.A., 857

P2d 26 (lst Cir. 1988) (Approves theory,
but direct marketing by defendant
also was involved). The stream of
commerce doctrine was well-settled prior

to Asahi. Gray v. American Radiator and

Standard Co., supra; In re Agent Orange

Litigation, 818 F2d 145 (2nd Cir. 1987);

Omstead v. Brader Heaters, Inc., 5 Wash.

App. 258, 487 P2d 234, 240 (1971), aff'd
80 Wash 2d 720, 497 P2d 1310, 1972);
Oswalt v. Scripto, 616 F2d 191 (5th Cir.

1980) (Japanese manufacture of cigarette
lighters subject to suit in U.S.); Sells

v. International Harvester Co., 513 F2d

762 (5th Cir. 1975); reh. den. 522 F2d

1280; Bean Dredging Corp. v. Dredge

Technology Corp.; 744 F2d 1081 (5th Cir.

1984); DeJames v. Magnificience Carriers,

Inc., 654 F2d 280 (3rd Cir. 1981), cert.
-18-

——— aS...

den. 454 U.S. 1085 (1981); Pfiffer v.

International Academy, 521 F. Supp. 1331

(D.C. Mo. 1981); Tedford v. Grumman

American Aviation Corp., 488 F. Supp. 144

(D.C. Miss. 1980); Stoehr v. American

Honda Motor Co., 429 F. Supp. 763 (D.C.

Neb. 1977); Haley v. Wright Mfg. Co., 651

P. Supp. 116 (D.C. La. 1986); McDaniel v.

Armstrong World Industries, 603 F. Supp.

1337 (D.C. D.C. 1985); McDaniel v.

Johns-Manville Sales Corp., 487 F. Supp.

714 (D.C. I1l. 1978) (Canadian seller of
asbestos held subject to suit by placing
asbestos in stream of commerce); Hall v.

Zambelli, 669 F. Supp. 753 (D.C. W. Va.

1987) (where manufacturer sells to a
distributor knowing that the product is
to be distributed throughout the United
States, due process is satisfied); Scott

v. Crescent Tool Co., 296 F. Supp. 147

(D.C. Ga. 1968); Payne v. Kristofferson,

-19-

ee

631 F. Supp. 39 (D.C. Ga. 1985); Rowe v.
Dorrough, 150 Cal. App. 3rd 901, 198 Cal.

Rptr. 131 (1984); Irving v. Owens-Corning

Fiberglas Co., 864 F2d 383 (5th Cir.

1989); Value Engineering Co. v. Gisell,

140 Ga. App. 44, 230 S.E.2d 29 (1976);

National Egg Co. v. Bank Leumi le-Israel

B.M., 504 F. Supp. 305 (D.C. Ga. 1980);

Thornton v. Toyota Motor Sales U.S.A.,

Inc., 397 F. Supp. 476 (D.C. Ga. 1975);

Burton v. Subaru of America, Inc., 646 F.

Supp. 78 (D.C. Ga. 1986); 63 Am. Jur. 2d

1286, §893; 4 Wright & Miller, Federal

Practice and Procedure, §1069, at pp.

391-392.

The Court below erred in holding
that the doctrine has been abrogated by
Ashai.

The District Court below also erred
in undertaking to construe the Georgia
long-arm jurisdiction statute because,
having recognized that it had been

-20-

construed by the Georgia Courts as
extending jurisdiction over nonresidents
to the maximum extent allowed by due
process, it is not necessary to consider

or apply state law. Morris v. SSE, Inc.,

843 F2d 489, n. 3 (l1ith Cir. 1988);

Interfirst Bank Clifton v. Fernandez, 844

F2d 279, 282 (5th Cir. 1988); Irving v.

Owens-Corning Fiberglass Corp., 864 F2d

383, 385 (5th Cir. 1989); Bean Dredging

Corp. v. Dredge Technology Corp., 744 F2d

1081, 1083 (5th Cir. 15984); American

Greetings Corp. v. Cohn, 839 F2d 1164,

1167 (6th Cir. 1988); Sinatra v. National

Enquirer, Inc., 854 F2d 1191 (9th Cir.

1988).

THE COURT OF APPEALS ERRED IN
FAILING TO HOLD THAT THE COURT
BELOW SHOULD HAVE TRANSFERRED UNDER
28 USC 1406(a) RATHER THAN DISMISSING

In Goldlawr v. Heiman, 369 U.S. 463,

8Z S. Ct. 913, 8 L.Ed.2d 39 (1962), this
Court held that transfer to an appropriate
venue rather than dismissal was proper

-21-

under 28 USC 1406(a), in a case where
both venue and jurisdiction were lacking,
even where there was no motion to
transfer. In this case, venue was proper
as far as the statute was concerned, but
the District Court and Court of Appeals
held that jurisdiction was lacking.

Here, as in Goldlawr, plaintiffs did not

move for a transfer in the District
Court, and reasonably could not do so
without waiving their contention that
jurisdiction existed under the stream of
commerce theory, but they did enumerate
error in the Court of Appeals on the |
ground that the District Court should

have done so sua sponte independently of

a motion. The Court of Appeals rejected

this enumeration of error. In Goldlawr,

the Court held that transfer rather than
dismissal was proper because "The problem
which gave rise to the enactment of the
section was that of avoiding the

=-23-

Siimmmmmmmmmmenmnemmnescrsess

injustice which had oft:en resulted to
plaintif‘fs from dismissal of their
actions merely because they had made an
erroneous guess with regard to the
existence of some elusive fact of the
kind upon which venue provisions often
turn. Indeed, this case is itself a
typical example of the problem sought to
be avoided, for dismissal here would have
resulted in plaintiff's losing a
substantial part of its cause of action
under the statute of limitations merely
because it made a mistake in thinking
that the respondent corporations could be
"found' or that they ‘transact...
business' in the Eastern Disrict of
Pennsylvania. The language and history
of §1406(a), both as originally enacted
and as amended in 1949, show a
congressional purpose to provide as
effective a remedy as possible to avoid

-23-

precisely this sort of injustice." (369
U.S. at 466).

The same principle is applicable
here. Because a civilian physician
Originally diagnosed petitioner Oliver
Bond's condition as being unrelated to
the chemical exposure, it was not until
amost four years later that he learned
otherwise. This presented no problem
under the Georgia Statute of Limitations
in products liability cases which is to
the effect that the statute starts to run
when the plaintiff discovers the facts of
the case indicating that he has a cause

of action. Andel v. Getz Services, 197

Ga. App. 653, 399 SE2d 226 (1990).

Georgia also has a rule that where a
plaintiff suffers dismissal that is not on
the merits, he may refile within six months
thereafter regardless of whether the
statute of limitations has run in the
interin.

-24-

O.C.G.A. §9-2-61. Georgia law also is to
the effect that when an action is brought
in the wrong venue, whether because of
jurisdiction or otherwise, the Court
should not dismiss, but should transfer
to the proper court. Constitution of
Georgia, 1983, Art. VI, Sec. I, Par.
VIII. -All of these questions are
uncertain under New Jersey law, and it is
doubtful that petitioners could refile in
New Jersey.

The Court of Appeals’ per curiam

affirmance left these questions
unconsidered, but respondent's argument
below was that §1406(a) applies only
where venue is improper, but not where in

personam jurisdiction was lacking. This

distinction is not a valid one, as

observed in Wright & Miller (Vol. 15,

§382), p. 171), and as more particularly
recognized in the decision of the Fifth

-25—

|

Circuit in Dubin v. U.S., 380 FP2d 813

(5th Cir. 1967), and in other cases, such
as Porter v. Groat, 840 F2d 255, 258 (4th

Cir. 1988); Ross v. Colorado Outward

Bound School, Inc., 603 F. Supp.’ 306

(D.C. N.Y. 1985); Tillary v. Idaho Power

Co., 425 F. Supp. 376 (D.C. Wash. 1976);
Westphal v. Mace, 660 F. Supp. 10 (D.C.

Ariz. 1987); Ladwig v. Trust Ins.

Exchange, 498 F. Supp. 161 (D.C. Wis.

1980); Mayo Clinic v. Kaiser, 383 F2d

653, 655 (8th Cir. 1967); Hapaniewski v.

City of Chicago Heights, 883 F2d 576 (7th

Cir. 1989); Corke v. Sameit M.S. Song of

Norway, 572 F2d 77 (2nd Cir. 1978); and
Bentz v. Recile, 778 F2d 1026 (5th Cir.

1985).

As Judge Johnson pointed out for
the Court in Dubin, the statute itself
does not refer to venue, but instead,
uses the terms "district" or "division".

~26-

In Goldlawr v. Heiman, supra both venue

and jurisdiction were lacking, and
Clearly, if transfer is proper when both
are lacking, transfer is equally proper
when only one is lacking.

A Court of Appeals is authorized and
empowered to transfer cases under

§1406(a). Panhandle Eastern Pipe Line Co.

v. Pederal Power Commission, 343 F2d 905

(8th Cir. 1965); Becker v. Commission of

Internal Revenue, 852 F2d 524 (llth Cir.

1988). Here, the Court of Appeals did
not order transfer, so it presumably
adopted respondent's argument that
transfer was not proper because the
Georgia District Court lacked jurisdic-
tion and not just venue. This is
contrary to the law in at least 5 other
circuits. This Court should hold that
(1) Transfer under §1406 is proper when
jurisdiction or venue are lacking; (2)
That the District Court itself should

~2J=

transfer without requiring the plaintiff
to waive his objections to the holding of
no jurisdiction; and (3) The Court of
Appeals on appeal should order transfer
when the District Court fails to do so.
Only in this way can the mass of
confusion evidenced in some district

court decisions be resolved.

CONCLUSION

The writ should be granted.

Respectfully Submitted,

HEARD, LEVERETT & PHELPS, P.C.

st Vite a
E. reeman Leveret

State Bar No. 448000
Counsel of Record for Petitioners

P. O. Drawer 399
Elberton, Georgia 30635
Tel: 404/283-2651

FAX: 404/283-2670

-28-

APPENDIX

I

PER CURIAM OPINION OF THE
COURT OF APPEALS

OLIVER M. BOND and HERTA R. BOND,
Plaintiffs-Appellants,

Vv.

OCTAGON PROCESS, INC.,
Defendant~Appellee.

No. 90-8898.

United States Court of Appeals,
Eleventh Circuit.

March 28, 1991.

Appeal from the United States District
Court for the Middle District of Georcia,
Duross Pitzpatrick, District Judge.

Before TJOFLAT, Chief Judge,
DUBINA, Circuit Judge, and
HENDERSON, Senior Circuit Judge.

PER CURIAM:

The judgment of the district court is
affirmed on the basis of the district

court's dispositive opinion, which is

reported as Bond v. Octagon Process,

Inc., 745 F. Supp. 710 (M.D. Ga. 1990).

AFFIRMED.

II

PER CURIAM OPINION OF
THE COURT OF APPEALS

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
ATHENS DIVISION
OLIVER M. BOND and HERTA R. BOND,
Plaintiffs,
vs.

OCTAGON PROCESS, iNC.,
Defendant.

CIV. NO. 87-41-ATH (DPF)

Piled at 4:40 P.M., September 19, 1990
Donna N. Phillips, Deputy Clerk,

U.S. District Court
Middle District of Georgia

FITZPATRICK, District Judge

This products liability case is before
the court for resolution of the
defendant's motion to dismiss for lack of
personal jurisdiction and, alternatively,

for summary judgment based on the

plaintiff's failure to state a claim.

A-2

I. FACTS

On December 5, 1982, plaintiff Oliver
Bond was engaged in active service with
the National Guard at the Elberton,
Georgia, Armory and was washing an M578
recovery vehicle with a cleaning solvent,
MIL-C--11090D, NSN 6850-00-224-6665,
manutactured by the defendant. The day
was a very cold one and the plaintiff
applied the solvent using a brush and
bucket without protective gloves and
without having read the warning label on
the solvent cans. After a short while,
his hands started burning, but he
continued to wash the vehicles for
several hours. The pain in his hands
continued through the next day.

After the pain lasted for some time,
plaintiff went to see a civilian doctor
who diagnosed his problem as Buerger's
disease, which is related to smoking.

A-3

OE

Another doctor, however, diagnosed the
plaintiff's condition as Raynaud's
phenomenon, the freezing of flesh in such
“ Manner as to damage permanently blood
vessels and cut off circulation. In
1986, doctors at Eisenhower Medical
Center at Port Gordon, Georgia,
identified the plaintiff's problem as
acguired acrosteolysis caused by exposure
to chemical solvents and a cold
environment. Later, this diagnosis was
changed to Raynaud's phenomenon caused by
cold environment and the defatting and
evaporative effects of chemical solvents,
rather than any toxic effects of the
solvent in question itself. In other
words, the plaintiff claims his injuries
are due to the combination of cold
weather and the effect of solvents in
such weather of removing the oils on the
skin and making it more vulnerable to the

A-4

cold. Additicnally, he claims that the
solvent further cools the skin through
evaporative cooling, which occurs when
body heat is lost in warming the solvent
on the skin and converting it from a
liquid to a gaseous state. In cold
weather, these properties of the solvent
mean that any flesh coming into contact
with it will cool more quickly than
otherwise and be susceptible to freezing.
Since the incident, plaintiff has suffered
great pain and is in the process of
losing his fingers and possibly his hands
as the skin tissue slowly dies.

Plaintiff filed his complaint on May
7, 1987, seeking damages for personal
injuries, including pain and suffering,
permanent and total disability, loss of
wages, loss of ability to labor, loss of
fingers and for hospital and medical
expenses. His wife, Herta Bond, also

A-5

sued for loss of consortium, including
services, society, companionship and
affection. Plaintiffs allege that Mr.
Bond's injuries were caused by the
defendant's failure to provide adequate
warnings of the dangers of exposure to
solvents at low temperatures.

Octagon Process, the defendant, is a
New Jersey corporation with no offices,
employees, agents or other personal
contacts with Georgia. Octagon has no
agent for service of process in Georgia
and has never sought approval from the
state of Georgia to do business there.

At its plant in New Jersey, the
defendant manufactures the solvent in
question pursuant to a government
contract. The solvent is made according
to specifications issued by the
government; Octagon did not develop or

alter the formula supplied by the

A-6

government. A jovernment inspector
stationed at the defendant's plant
supervised the manufacturing process and
had the authority to set aside any
shipment that failed to conform to the
specifications before it left the
premises. The solvent was made for sale
to the United States only and has never
been sold to any private purchaser. At
the time of the injury, Octagon was the
only approved supplier of the solvent.

On June 14, 1989, Octagon filed its
motion for dismissal and summary judgment
based on three theories: (1) that there
is no personal jurisdiction based on the
Georgia long-arm statute; (2) that even
if the statute gives this court
jurisdiction the defendant will be put to
unreasonable hardship if it must deferd
in Georgia; and (3) that the governmert
contractor defense applies and shields

A-7

EO —————

the defendant from liability. After
reviewing the applicable law and facts,

the court is ready to issue its ruling.

II. PERSONAL JURISDICTION

In a federal diversity suit, there is
a two-step process used in determining
whether a state jurisdictional statute
confers jurisdiction over a non-resident
defendant. First, it must be decided
whether the defendant is amenable to suit
under the state statute, as determined by
the law of the state. Next, if the first
step is met, the court must decide
whether the assertion of jurisdiction
over the defendant meets federal due

process requirements. Delong Equipment

Co. v. Washington Mills Abrasive Co., 840

F.2d 843 (llth Cir. 1988); Oswalt v.

Scripto, Inc., 616 F.2d 191, 195-96 (5th

Cir. 1980).

The plaintiff seeks to bring the
defendant within the reach of the Georgia
long-arm statute, 0.C.G.A. § 9-10-91,
which reads in pertinent part:

A court of this state may exercise
personal jurisdiction over any non-
resident or his executor or
administrator, as to a cause of action
arising from any of the acts,
omissions, ownership, use or
possession enumerated in this Code
section, in the same manner as if he
were a resident of the state, if in
person or through an agent, he: ...

(3) Commits a tortious injury in
this state caused by an act or
omission outside this state if the
tort-feasor regularly does or
solicits business, or engages in
any other persistent course of
conduct, or derives substantial
revenue from goods used or consumed
or services rendered in this state;

Plaintiffs must show that the
defendant is amenable to suit under this
statute before any federal constituticnal
questions are reached. It has been
determined by Georgia courts that the

Georgia long-arm statute allows for

A-9

jurisdiction to be exercised over
defendants to the maximum extent allowed

by due process. Value Engineering Co. v.

Gisell, 140 Ga. App. 44, 230 S.E.2d 29
(1976); Hollingswroth v. Cunard Line, 152

Ga. App. 509, 263 S.E. 2d 190 (1979). In
order to comply with this section of the

long-arm statute, the following test must
be satisfied:

(1) The nonresident has purposefully
done some act or consummated some
transaction with or in the forum (but
the actual act or omission resulting
in the injury here need not have
occurred in this state.) The
defendant need not be physically
within the forum when this act or
transaction occure and a single such
instance may suffice;

(2) The Georgia plaintiff must have a
legal cause of action in tort against
the nonresident, which arises out of,
Or results from, the purposeful
activity of the defendant involving
this state; a resident is the victim
of a “tortious act" when he suffers an
injury here due to an act or omission
of negligence occurring outside this
state; and

A-10

(3) If the requirements of (1) and
(2) are satisfied, the exercise of
jurisdiction over the nonresident must
be "reasonable."

Shellenberger v. Tanner, 138 Ga. App.

399, 404-05, 227 S.E.2d 266, 273 (1976);
cited with approval in Smith v. Smith,

254 Ga. 450, 330 S.E.2d 706, 706 (1985);
Delong, 840 F.2d at 849.
The court is not satisfied that the

first part of the Shellenberger test has

been met in this cse. It is undisputed
that Octagon has no direct ties with
Georgia, as noted above. The deposition
of Mr. Lee Leibmann, Octagon's president,
indicates that the defendant shipped the
solvent in question to various government
depots around the country, after which
the government sent it to where it was
needed. (Depo. pp. 22-24). Thus, the
defendant shipped the product to an
independent distributor who then
controlled where it ws ultimately sent.

A-11

This is the closest contact Octagon has
ever had with Georgia, and it simply does
not qualify as "a transaction with or in

the forum." Shellenberger, 227 S.E.2d at

273. If, for example, Octagon had
directly sent the solvent to the National
Guard armory in Elberton or consummated a
bargain to sell the solvent directly to
the Georgia National Guard this would of
course satisfy the test, but such is not
the case here, and the defendant is thus
not amenable to suit under the Georgia
long~arm statute.

Even if all three of the Shellenberger

requirements had been fulfilled, Octagon
would still not be subject to the
jurisdiction of this court because
federal constitutional due process
requirements are not satisfied. The
Supreme Court has laid down and developed
guiding principles of due process in a

A-12

series of cases over the past several

1

decades. In International Shoe Co. yv.

Washington, 326 U.S. 310, 66 S. Ct. 154,

90 L.Ed. 95 (1945), the Court stated the
basic two-part test for determining when
states may exercise jurisdiction over
non-resident defendants: (1) they must
have “minimum contacts” with the forum
state and (2) the maintenance of the suit
must not offend "traditional notions of

fair play and substantial justice." 326

l. There are two types of personal
jurisdiction: general and specific.
General personal jurisdiction arises from
a party's contacts with the forum state
that are unrelated to the litigation; the
test is whether the party had "continuous
and systematic” general business contacts
with the forum state. Specific personal
jurisdiction is based on a party's
contacts with the forum state that are
related to the litigation. Delong, 849
P.2d at 853 (citations omitted). The
plaintiff in the case at bar has not
alleged that general jurisdiction exists
over the defendant and could not do so
given the facts. the discussion in the
text therefore concerns specific
jurisdiction.

A-13

U.S. at 316, 66 S.Ct. at 158. (The second
part of this test has been rephrased to
mean that it must be “reasonable” for a
court to exercise jurisdiction over a
defendant. Delong, 840 F.2d 854.) This
standard was later clarified to mean that
due process requires some purposeful
availment by the defendant of the
privilege of conducting activities in the
forum state and thus invoking the

benefits and protections of that state's

laws. Hanson v. Denckla, 357 U.S. 235,

253, 78 S.Ct. 1228, 1239-40, 2 L.Ed.2d
1283 (1958).
A limit on expanding notions of due

process was provided in World-Wide

Volkswagon v. Woodson, 444 U.S. 286, 100

S.Ct. 559, 62 L.Ed.2d 490 (1980), in

| which the Court rejected the notion that
the defendant was amenable to suit simply
because of the "foreseeability” that the

A-14

item it 30ld might enter the forum state.
Instead, the Court decided that due
process was bared on whether the
defendant's cor:duct and connection with
the forum state were such that it could
reasonably anticipate being haled into
court there. 444 U.S. at 297, 100 S.Ct.

at 567. In Burger King Corp. v.

Pudzewicz, 471 U.S. 462, 105 S.Ct. 2174,

€5 L.Ed.2d 528 (1985), the Court stated
chat jurisdiction over a non-resident
defendant was proper if the defendant had
delivered its products into the stream of
commerce with the expectation that they
would be purchased by consumers in the
forum state and those products
subsequently injured forum consumers.
471 U.S. at 473, 105 S.Ct. at 2182.

The Supreme Court greatly narrowed the
application of the stream of commerce

theory in Asahi Metal Ind. v. Superior

A-15

ew

Court of California, Solano County,

U.S. _, 107 S.Ct. 1026, 1033 (1987).
Asahi was a Japanese valve assembly
manufacturer who sold its products to a
~~ tire manufacturer who exported
the completed tires to the United States.
After a products liability suit was filed
because of an accident allegedly caused
by a defective tire, the Taiwanese
defendant filed a cross-claim for
indemnification which became the subject
of the case that reached the Supreme
Court after the underlying action had
been settled and dismissed. The
California Supreme Court had earlier
determined that due process would allow
for the exercise of jurisdiction over
Asahi in California, since the defendant
had intentionally placed its products in

the stream of commerce and knew that some

A-16

of the completed tires containing its
products would be sold in California.

In analyzing whether Asahi had form
(sic) sufficient minimum contacts with
California to justify that state's
exercise of jurisdiction, a plurality of
the Court noted that since its decisicn

in World-Wide Volkswagon, 444 U.S. 286,

100 S.Ct. 559, two versions of the stream
of commerce theory had arisen. Some
courts had read the due process clause as
allowing for jurisdiction based on
nothing more than the defendant's placing
the product in the stream of commerce,
while others had required some action of
the defendant more purposefully directed
at the forum state than mere awareness
that its product would eventually reach
there. The California Supreme Court had
adhered to the former view of due
process. Asahi, 107 S.Ct. at 1032.

A-17

a

The Supreme Court, however, decided
that this was not sufficient and that for
the due process clause to be satisfied
there had to be some act of the defendant
purposefully directed toward the forum
state. Merely placing an item in the
stream of commerce, without more, was
held not to be enough. Furthermore, the
Court stated that even the defendant's
awareness that its product would
eventually reach the forum state via the
stream of commerce did not convert the
act of placing the product into the
stream into an act purposefully directed
toward the forum state. 107 S.Ct. 1033.

Keeping these standards in mind, it is
clear to this court that it cannot
exercise personal jurisdiction over
Octagon. Even assuming that the
plaintiffs are correct when they claim

that Octagon knew its product would

A-18

eventually enter Georgia (Brief on Behalf
of Plaintiffs in Opposition to
Defendant's Motions to Dismiss, for
Pailure to State a Claim, and for Summary
Judgement, pp. 8-9), Asahi has made it
clear that this is simply not enough to
form sufficient minimum contacts so that
Octagon could foresee being haled into

court here. The record reveals no other
act by the defendant seeaiiiiiedty
directed toward Georgia as required by
Asahi. When Octagon sold the solvent to
the Department of Defense, which acted as
an independent distributor, it merely
placed its product into the stream of
commerce, an act which alone will not
allow this court to exercise personal

jurisdiction in Georgia.”

2. The court is aware that this reading
of Asahi will allow defendants to
organize their operations to avoid
selected jurisdictions and their laws.
Cound, FPriedenthal, Miller & sexton,

A-19

Plaintiffs make a valiant, but
unsuccessful, effort to distinguish
Asahi. They correctly point out that
Asahi dealt with a cross-claim for
indemnification after the original suit
involving the injured party had been
settled. While valid, this distinction
is insufficient to overcome the general
jurisdictional rules laid down in the
case. To adopt plaintiff's interpreta-
tion would limit Asahi to cases with
facts practically identical to it,
something which this court declines to
do. Also, plaintiffs claim that one of
the main reasons the Supreme Court found
that there was no jurisdiction over Asahi
in California was because the case

involved two foreign parties and to have

f.n. 2 continued ... Civil Procedure
137 (5th ed. 1989). Nonetheless, the
Supreme Court's ruling compels this
result.

A~20

exercised jurisdiction over the defendant
would have subjected it to the unique
burdens of defending in a foreign legal
system. This is also true, but this
reason concerns the second part of the

International Shoe test (whether

exercising “jurisdiction over the
defendant i3 reasonable), and has nothing
to do with the first part (whether the
defendant has sufficient minimum contacts
with the forum). While it may be
reasonable to exercise jurisdiction over
Octagon in this case, the court still
cannot do so if the defendant lacks
sufficient minimum contacts with the
forum, which, as discussed above, is true
of Octagon.

In addition, the plaintiffs attempt to

distinguish World-Wide Volkswagen, which

itself placed some limits on due process
jurisdiction, by noting that the
A-21

eens

defendant in that case, over whom the
Supreme Court decided that jurisdiction
could not be exercised, was merely a
distributor of the product and not a
manufacturer. Plaintiffs give great
weight to the fact that Justice Blackmun
himself pointed out this distinction, 444
U.S. at 317-318, 100 S.Ct. at 570
(Blackmun, J., dissenting), and claim
that since this suit is against a
manufacturer the court should exercise
its jurisdiction. The court notes,
however, that the defendant in Asahi,
over whom the Supreme Court held there
was no jurisdiction in part because of
insufficient minimum contacts, was also a

manufacturer, and thus the plaintiffs’

Batlectiea = Lette 7 As
Asahi makes clear, the essential question
is whether the defendant, regardless of
his status as a manufacturer or

A-22
Ee

distributor, has done some act purpose-
fully directed toward the forum state 30
as to form sufficient minimum contacts
with that state such that he could
anticipate being haled into court there.
Regarding Octagon, this requirement
simply has not been fulfilled.
Plaintiffs also place great reliance
on Oswalt, 616 F.2d 191, and some similar
cases.> In Oswalt, the plaintiff was
injured when a cigarette lighter mal-
functioned. The lighter had been
manufactured in Japan but distributed in

the United States by Scripto, Inc., an

3. The plaintiffs also cite Bean Dredging
corks Ve predse Fee ae Corp.,

F. th Cir. , and Petroleum
Helicopters, Inc. v. Avco Corp., 804 P.2d
1367 a Cir. 1986). In both cases the
Pifth Circuit held that the defendants
were subject to personal jurisdiction
because they had placed their products in
the stream of commerce with the

expectation or knowledge that the goods
would reach the forum state.

A-23

|

American Corporation. There was no
evidence that the Japanese manufacturer
nad any officers or agents in the United
States or any contacts with the United
States at all except for the distributing
agreement with Scripto. Nonetheless, the
court found that there was personal
jurisdiction over the manufacturer
because it knew that its lighters were
being sold naticnally in the United
States and thus had reason to know that
its products would reach the scene of the
injury. By utilizing the distribution
network established by Scripto, the
Japanese company had established
sufficient minimum contacts so that it
could reasonably expect to be haled into
court in this country. 616 F.2d at

198-200.

Plaintiffs' reliance on Oswalt and
cases with similar holdings is misplaced,

A-24

however, because of changes in the law.
Oswalt was decided in 1980 immediately
after the Supreme Court's decision in

World-Wide Volkswagen and adhered to the

view that merely placing a product in the
stream of commerce without more was
enough to satisfy due process require-
ments. As noted above, the Supreme Court
rejected this line of thinking in Asaki
by holding that due process also requires
some purposeful act by the defendant
directed toward the forum state. Oswalt

and cases like it simply do not speak to

the case at bar.

III. CONCLUSION

After careful consideration of the
facts and law in this case, the court hag
decided that Octagon's motion to dismiss
for lack of personal jurisdiction due to
insufficient minimum contacts between it

A-25

and the forum state should be GRANTED.
Accordingly, the court need not reach the
questions of whether it would be reason-
able to exercise jurisdiction over the
defendant in Georgia or the government
contractor defense. The plaintiffs’ case
is hereby ordered DISMISSED.

SO ORDERED, this 19 day of September,
1990.

/s/ DUROSS PITZPATRICK
D ,
UNITED STATES DISTRICT COURT

A-26

PUBLISHER'S NOTE

THE FOLLOWING PAGES ARE UNAVAILABLE
FOR FILMING:

A-27 & A-28

ee ee SEE lClcerlrl ll ele lr rhc rm ler

CERTIFICATE OF SERVICE

I hereby certify that I have served
copy of the foregoing Petition for Writ
of Certiorari upon Mr. Carl R. Woodward,
Carella, Byrne, Bain, Gilfillan, Cecchi
and Stewart, 6 Becker Farm Road,
Roseland, New Jersey 07068-1739 and upon
Mr. Peter J. Anderson, Peterson, Young,
Self & Asselin, Suite 1100, 230 Peachtree
Street, N.W., Atlanta, Georgia 30303,
Attorneys for Respondent, by mail, duly
addressed and postage prepaid.

A
This <0 - day of April, 1991.

Attorney for Petitioners

-29-

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_2022%3A1. Public record. Not legal advice.