Also known as:jurisdictional nexuses · jurisdictional connection · minimum contacts
Written by attorneys — see sources below.
A connection between a defendant and the forum state or between regulated activity and interstate commerce that permits the exercise of personal jurisdiction or federal regulatory authority consistent with due process and constitutional limits.
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How its tested
Common Examples
5
Purposeful Availment Through Sales
Jose Jimenez, a resident of State A, ordered custom parts from Jiang Textiles, a company incorporated and operating exclusively in State B. Jiang Textiles had no offices, agents, or advertising in State A and shipped the parts only after receiving an unsolicited order placed by Jimenez through a third-party website. When the parts proved defective, Jimenez sued Jiang Textiles in State A court. The court dismissed the action because Jiang Textiles had not purposefully directed any activity toward State A, so no jurisdictional nexus existed to support personal jurisdiction.
Minimum Contacts From Targeted Promotions
Joy Jiang, a consumer in State C, purchased clothing from Jenkins Apparel after seeing State C-specific online advertisements and receiving repeated shipments of goods into State C over several months. When the clothing caused an allergic reaction, Jiang sued Jenkins Apparel in State C court. The court upheld jurisdiction because the company's deliberate marketing and sales created a sufficient jurisdictional nexus with State C that made the exercise of personal jurisdiction fair.
Jamal Jefferson owned real property in State D that had been attached by a creditor in an unrelated contract dispute arising entirely in State E. Jefferson moved to quash the attachment, arguing that the mere presence of the property did not create a jurisdictional nexus with State D. The court agreed and released the property because the claim bore no relation to the asset located in the forum.
Appointment of Agent Creates Broad Exposure
Jordan Jenkins, an Ohio resident, sued Jordan Dynamics, an out-of-state corporation, on a claim unrelated to any Ohio transaction. Jordan Dynamics had appointed a resident agent in Ohio solely to comply with a state tolling statute. The court held that the appointment established a jurisdictional nexus sufficient for general jurisdiction over all claims against the company.
Bendix Autolite Corp. v. Midwesco Enterprises, Inc.486 U.S. 888 (1988)
In 1974, Midwesco Enterprises, Inc., agreed with Bendix Autolite Corporation to deliver and install a boiler system at a Bendix facility in Fostoria, Ohio. Bendix is a Delaware corporation with its principal place of business in Ohio, while Midwesco is an Illinois corporation with its principal place of business in Illinois. Bendix became dissatisfied with the work, claiming that the boiler system had been installed improperly and that it was insufficient to produce the quantity of steam specified in the contract.
This diversity action was filed against Midwesco in the United States District Court for the Northern District of Ohio in 1980. When Midwesco asserted the Ohio statute of limitations as a defense, Bendix responded that the statutory period had not elapsed because under Ohio law the running of the time is suspended, or tolled, for claims against entities that are not within the State and have not designated an agent for service of process. Midwesco replied that this tolling provision violated both the Commerce Clause and the Due Process Clause of the Fourteenth Amendment.
The District Court dismissed the action, finding that the Ohio tolling statute constituted an impermissible burden on interstate commerce. The Court of Appeals for the Sixth Circuit affirmed, finding that the Ohio statute constituted discrimination in violation of the Commerce Clause because it required a foreign corporation to choose between exposing itself to personal jurisdiction in state courts by complying with the tolling statute, or, by refusing to comply, to remain liable in perpetuity for all lawsuits containing state causes of action filed against it in the State. Bendix appealed, and the Supreme Court noted probable jurisdiction to review the constitutionality of the Ohio tolling statute in 1987.
Javier Jimenez, a South Dakota resident, purchased merchandise from an online retailer that had no physical presence in the state but regularly shipped substantial volumes of goods to South Dakota customers. When a tax dispute arose, the state asserted jurisdiction to collect sales tax. The court upheld the requirement because the retailer's continuous economic activity created a jurisdictional nexus with the state.
South Dakota v. Wayfair, Inc.584 U.S. _, 138 S. Ct. 2080 (2018)
South Dakota taxes the retail sales of goods and services in the State. Sellers are required to collect and remit the tax to the State, but if they do not then in-state consumers are responsible for paying a use tax at the same rate. Under prior decisions, South Dakota may not require a business that has no physical presence in the State to collect its sales tax. Consumer compliance rates are notoriously low, and it is estimated that those decisions cause South Dakota to lose between $48 and $58 million annually.
Concerned about the erosion of its sales tax base and corresponding loss of critical funding for state and local services, the South Dakota Legislature enacted a law requiring out-of-state sellers to collect and remit sales tax as if the seller had a physical presence in the State. The Act covers only sellers that, on an annual basis, deliver more than $100,000 of goods or services into the State or engage in 200 or more separate transactions for the delivery of goods or services into the State.
Respondents Wayfair, Inc., Overstock.com, Inc., and Newegg, Inc. are merchants with no employees or real estate in South Dakota. Wayfair, Inc. is a leading online retailer of home goods and furniture and had net revenues of over $4.7 billion last year. Overstock.com, Inc. is one of the top online retailers in the United States and had net revenues of over $1.7 billion last year. Newegg, Inc. is a major online retailer of consumer electronics in the United States. Each of these three companies ships its goods directly to purchasers throughout the United States, including South Dakota. Each easily meets the minimum sales or transactions requirement of the Act, but none collects South Dakota sales tax.
Pursuant to the Act’s provisions for expeditious judicial review, South Dakota filed a declaratory judgment action against respondents in state court, seeking a declaration that the requirements of the Act are valid and applicable to respondents and an injunction requiring respondents to register for licenses to collect and remit the sales tax. Respondents moved for summary judgment, arguing that the Act is unconstitutional. The trial court granted their motion. The South Dakota Supreme Court affirmed on the ground that Quill is controlling precedent. This Court granted certiorari. The case was argued on April 17, 2018, and decided on June 21, 2018.
What must a plaintiff show to establish a jurisdictional nexus for specific personal jurisdiction?
The plaintiff must demonstrate that the defendant purposefully availed itself of the forum state and that the claim arises out of or relates to those contacts. Unilateral activity by the plaintiff or a third party cannot create the required connection.
Supporting sources
Does the presence of a defendant's property in the forum automatically supply a jurisdictional nexus?
No. When the underlying dispute is unrelated to the property, its mere presence does not establish the minimum contacts necessary for personal jurisdiction.
Supporting sources
How does a jurisdictional nexus requirement function in federal commerce-based statutes?
Congress may include an express element requiring proof that the regulated activity affected or moved in interstate commerce. This element keeps enforcement within constitutional bounds by ensuring a case-by-case connection to the Commerce Clause power.
Why did the absence of a jurisdictional nexus element doom the statute in Lopez?
Without an express requirement that the firearm possession affect interstate commerce, the statute lacked any mechanism to ensure the regulated activity fell within Congress's commerce power on a case-by-case basis.
…for service in all cases and to defend itself with reference to all transactions, including those in which it did not have the
minimum contacts
necessary for supporting personal jurisdiction, is a significant burden. See Asahi Metal Industry Co. v. Superior Court , 480 U. S. 102, 114 (1987). Although statute of limitations…