Sproul v. Rob & Charlies, Inc. ( 2012 )


Menu:
  •                                               I attest to the accuracy and
    integrity of this document
    New Mexico Compilation
    Commission, Santa Fe, NM
    '00'04- 16:38:18 2013.07.12
    IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
    Opinion Number: 2013-NMCA-072
    Filing Date: August 15, 2012
    Docket No. 31,167
    ARCHIBALD A. SPROUL and
    LISA McFADDEN SPROUL,
    Plaintiffs,
    v.
    ROB & CHARLIES, INC., GT BICYCLES,
    INC., PACIFIC CYCLE, INC., and ISHIWATA,
    Defendants,
    and
    ROB & CHARLIES, INC.,
    Third-Party Plaintiff-Appellant,
    v.
    JOY INDUSTRIAL CO., LTD.,
    Third-Party Defendant-Appellee,
    and
    J & B IMPORTS, INC., QUALITY BICYCLE
    PRODUCTS, INC., and DOREL INDUSTRIES, INC.,
    Third-Party Defendants.
    APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY
    Barbara J. Vigil, District Judge
    Hatcher & Tebo, P.A.
    Scott P. Hatcher
    1
    Christopher J. Tebo
    Santa Fe, NM
    for Appellant
    McClaugherty & Silver, P.C.
    Tamara R. Safarik
    Joe L. McClaugherty
    Santa Fe, NM
    for Appellee
    OPINION
    VANZI, Judge.
    {1}      This case arises from an indemnification claim brought by Third-Party Plaintiff Rob
    and Charlies, Inc. (R&C), a bicycle retailer doing business in New Mexico, against Third-
    Party Defendant Joy Industrial Co., Ltd. (Joy Co.), a foreign manufacturer of bicycle parts.
    R&C appeals a judgment of the district court granting Joy Co.’s motion to dismiss for lack
    of personal jurisdiction. The district court concluded that Joy Co. lacked the constitutionally
    required minimum contacts with New Mexico necessary to support personal jurisdiction and
    that, even if the necessary minimum contacts were established, the exercise of jurisdiction
    over Joy Co. would nevertheless offend traditional notions of fair play and substantial
    justice. We disagree with the district court and reverse. Further, this Opinion clarifies the
    standards to be used for evaluating whether a person or entity is subject to the jurisdiction
    of New Mexico courts despite not having been present in the state, either at the time of the
    suit or at the time of the alleged injury, and despite not having consented to the exercise of
    jurisdiction.
    I.     BACKGROUND
    {2}     In 1988, Plaintiff Archibald Sproul purchased a GT All-Terra Mountain Bicycle from
    R&C, a retail bicycle store located in Santa Fe, New Mexico. Sproul was riding that bicycle
    on May 19, 2003, at a BMX course in Santa Fe County. As he went over a bump, the front
    wheel separated from the bicycle’s front fork assembly. Sproul was thrown off the bicycle
    and, as a result, he suffered serious, permanent injuries. On May 18, 2006, Sproul filed suit
    against R&C; GT Bicycles, Inc.; Pacific Cycle, Inc. (the companies that manufactured the
    bicycle); and Ishiwata (the company that manufactured the bike’s frame and fork). Sproul
    alleged that, among other things, Defendants’ negligently designed, manufactured,
    assembled, and sold the bicycle, quick-release hub, and front fork, which failed, causing the
    front wheel to fall off.
    2
    {3}     R&C filed a third-party complaint for indemnity against Joy Co. in May 2008. Joy
    Co. is the manufacturer of the quick-release mechanism on the GT bicycle that Sproul
    purchased from R&C. Joy Co. has its principal places of business in China and Taiwan, and
    its two manufacturing facilities are located in China. Joy Co. “sells its products to the global
    bicycle marketplace through a network of agents and suppliers.”
    {4}     R&C claimed that it was entitled to a right of indemnification against Joy Co.
    because Joy Co. was the upstream manufacturer of the allegedly defective quick-release
    mechanism that was ultimately sold by R&C in New Mexico. Joy Co. responded by filing
    a motion to dismiss for lack of personal jurisdiction. Joy Co. contended that it had no
    distributors or clients in New Mexico and did not know where the bicycles that incorporated
    its quick-release mechanisms were sold. Therefore, Joy Co. argued, there were no facts
    indicating that it had the necessary systematic and continuous contacts or purposeful contact
    required to subject it to either general or specific jurisdiction in New Mexico.
    {5}      After allowing the parties to conduct limited discovery on the jurisdictional issue, the
    district court considered their written submissions and oral arguments and ultimately granted
    Joy Co.’s motion to dismiss. Specifically, the court concluded that R&C failed to show as
    a matter of law that Joy Co. had sufficient contacts with New Mexico to enable it to assert
    personal jurisdiction. The district court further found that the exercise of jurisdiction over
    Joy Co. would offend traditional notions of fair play and substantial justice. The district
    court denied R&C’s motion for reconsideration; however, it certified the matter for
    interlocutory appeal, and we granted the application.
    II.     STANDARD OF REVIEW
    {6}     The determination whether a district court has personal jurisdiction over a
    nonresident defendant is a question of law that we review de novo. Sublett v. Wallin, 2004-
    NMCA-089, ¶ 11, 
    136 N.M. 102
    , 
    94 P.3d 845
    . Where, as here, the district court bases its
    ruling on the parties’ pleadings, attachments, and non-evidentiary hearings, we apply a
    standard of review mirroring that of our standard governing appeals from summary
    judgment. 
    Id. “We construe
    the pleadings and affidavits in the light most favorable to the
    complainant, and the complainant need only make a prima facie showing that personal
    jurisdiction exists.” Id.; see Tercero v. Roman Catholic Diocese, 2002-NMSC-018, ¶ 5, 
    132 N.M. 312
    , 
    48 P.3d 50
    . Accordingly, dismissal is proper in this case only if all the specific
    facts that R&C alleges collectively fail to state a prima facie case for jurisdiction over Joy
    Co.
    III.    ANALYSIS
    {7}    R&C raises eight issues on appeal. All of these issues can fairly be collapsed into
    one question: whether Joy Co. has sufficient minimum contacts with New Mexico necessary
    to support personal jurisdiction and, thus, whether the district court erred by granting Joy
    Co.’s motion to dismiss. The answer requires us to employ a two-step analysis. The first
    3
    step is to determine whether personal jurisdiction over Joy Co. would be in accordance with
    the requirements of New Mexico’s long-arm statute. Concluding that jurisdiction may
    properly be extended under our long-arm statute, we then proceed to the second step. At
    step two of the analysis, we examine whether the exercise of personal jurisdiction would
    offend the Due Process Clause of the United States Constitution. Whether a state may
    exercise personal jurisdiction over a nonresident civil defendant depends on the nature and
    quality of the defendant’s contacts with the forum. In that regard, personal jurisdiction has
    been described as being either “general” or “specific.” R&C contends that both exist in this
    case. In addressing R&C’s respective arguments, we determine that the state may not
    exercise general jurisdiction over Joy Co. However, in clarifying our personal jurisdiction
    jurisprudence—especially with respect to the stream of commerce theory of
    jurisdiction—Joy Co. has minimum sufficient contacts to subject it to specific jurisdiction
    in New Mexico under the standard set forth in World-Wide Volkswagen Corp. v. Woodson,
    
    444 U.S. 286
    (1980). Further, the volume of contacts Joy Co. has with New Mexico make
    it reasonable to subject Joy Co. to personal jurisdiction. This Opinion ends by analyzing the
    United States Supreme Court’s opinion in Asahi Metal Industry Co. v. Superior Court, 
    480 U.S. 102
    (1987), and its more recent decision in J. McIntyre Machinery, Ltd. v. Nicastro, ___
    U.S. ___, 
    131 S. Ct. 2780
    (2011), and it addresses why personal jurisdiction cases are not
    evaluated under any of the competing versions of the stream of commerce theories in those
    cases.
    A.     New Mexico’s Long-Arm Statute
    {8}    In construing whether a nonresident defendant may be subject to jurisdiction in the
    forum state, this Court looks to New Mexico’s long-arm statute, which provides, in pertinent
    part,
    Any person, whether or not a citizen or resident of this state, who in person
    or through an agent does any of the acts enumerated in this subsection
    thereby submits himself or his personal representative to the jurisdiction of
    the courts of this state as to any cause of action arising from:
    (1)     the transaction of any business within this state;
    ....
    (3)     the commission of a tortious act within this state[.]
    NMSA 1978, § 38-1-16(A)(1), (3) (1971). The term “person” as used in the statute includes
    corporations. See, e.g., Roberts v. Piper Aircraft Corp., 
    100 N.M. 363
    , 367-68, 
    670 P.2d 974
    , 978-79 (Ct. App. 1983) (holding that under our long-arm statute, New Mexico could
    assert personal jurisdiction over an Oklahoma service provider who advertised nationally
    and directly served a New Mexican customer). New Mexico courts do not require a
    technical determination whether a defendant has committed one of the enumerated acts.
    Zavala v. El Paso Cnty. Hosp. Dist., 2007-NMCA-149, ¶ 10, 
    143 N.M. 36
    , 
    172 P.3d 173
    .
    Instead, because we “have construed the state long-arm statute as being coextensive with the
    4
    requirements of due process, [our] analysis collapses into a single search for the outer limits
    of what due process permits.” F.D.I.C. v. Hiatt, 
    117 N.M. 461
    , 463, 
    872 P.2d 879
    , 881
    (1994) (internal quotation marks and citation omitted). The question of personal jurisdiction
    therefore hinges on federal law.
    B.      The Due Process Clause
    {9}     “The Due Process Clause of the Fourteenth Amendment limits the power of a state
    court to render a valid personal judgment against a nonresident defendant.” World-Wide
    
    Volkswagen, 444 U.S. at 291
    . Due process is satisfied only when a defendant has sufficient
    minimum contacts with the forum state so that the assertion of jurisdiction over the
    defendant will not violate “traditional notions of fair play and substantial justice.” Goodyear
    Dunlop Tires Operations, S.A. v. Brown, ___ U.S. ___, ___, 
    131 S. Ct. 2846
    , 2853 (2011)
    (internal quotation marks and citation omitted); Tercero, 2002-NMSC-018, ¶ 7.
    Accordingly, we must first determine whether a defendant has sufficient minimum contacts
    with New Mexico. Burger King Corp. v. Rudzewicz, 
    471 U.S. 462
    , 474 (1985) (“[T]he
    constitutional touchstone remains whether the defendant purposefully established minimum
    contacts in the forum [s]tate.” (internal quotation marks and citation omitted)). If a
    defendant has sufficient minimum contacts for personal jurisdiction, such jurisdiction will
    be exercised only if it is reasonable to do so. Zavala, 2007-NMCA-149, ¶ 12 (setting out the
    five factors we consider to make this determination). Further, as we have noted, the
    minimum contacts required for the state to assert personal jurisdiction over a defendant
    depends on whether the jurisdiction asserted is general (all-purpose) or specific (case-
    linked). Goodyear, ___ U.S. at ___, 131 S. Ct. at 2851; Zavala, 2007-NMCA-149, ¶ 12.
    {10} In this case, R&C contends that it made a prima facie showing that New Mexico
    courts could exercise both general and specific jurisdiction over Joy Co. We address each
    of R&C’s contentions in turn.
    1.      General Jurisdiction
    {11} R&C maintains that it has met its prima facie burden of establishing general
    jurisdiction and that the district court erred in resolving the issue in Joy Co.’s favor. For the
    reasons that follow, we disagree.
    {12} A state exercises general jurisdiction over a nonresident defendant when its
    “affiliations with the [s]tate are so continuous and systematic as to render [it] essentially at
    home in the forum [s]tate.” Goodyear, ___ U.S. at ___, 131 S. Ct. at 2851 (internal
    quotation marks and citation omitted). As a result, due process prohibits general jurisdiction
    over corporations when corporate ties arise from “the casual presence of the corporate agent
    or even his conduct of single or isolated” acts unrelated to the claim. Int’l Shoe Co. v.
    Wash., 
    326 U.S. 310
    , 317 (1945). The United States Supreme Court has explained that “[t]o
    require the corporation in such circumstances to defend the suit away from its home or other
    jurisdiction where it carries on more substantial activities has been thought to lay too great
    5
    and unreasonable a burden on the corporation to comport with due process.” 
    Id. In keeping
    with United States Supreme Court precedent, we too have said that general jurisdiction exists
    when a defendant can “reasonably foresee being haled into court in that state for any
    matter[.]” Zavala, 2007-NMCA-149, ¶ 12 (internal quotation marks and citation omitted).
    {13} R&C contends that New Mexico has general personal jurisdiction over Joy Co.
    because the company has continuous and systematic contacts with New Mexico. However,
    R&C does not allege any facts to support this assertion. For example, R&C has not provided
    evidence that Joy Co. is incorporated under the laws of New Mexico, that it has corporate
    operations, employees, or agents here, or that it has manufacturing facilities in the state.
    Consequently, we conclude that the requisite types of contacts, such as the existence of
    corporate operations or the manufacture of products in New Mexico, which we have said can
    be a basis for general jurisdiction, do not exist over Joy Co. in this case. Cf. United Nuclear
    Corp. v. Gen. Atomic Co., 
    90 N.M. 97
    , 102-03, 
    560 P.2d 161
    , 166-67 (1976) (holding that
    the combined facts showing the defendant’s multiple activities within the state warranted the
    assertion of general jurisdiction).
    {14} Moreover, to the extent that R&C asserts the sale of Joy Co.’s products in New
    Mexico may establish general personal jurisdiction, we are not persuaded. As the United
    States Supreme Court has recently clarified, the flow of a manufacturer’s goods into the
    forum state alone does not create sufficient ties with that state to give it general jurisdiction
    over the manufacturer. Goodyear, ___ U.S. at ___, 131 S. Ct. at 2855. Consistent with the
    holding in Goodyear, we have previously determined that “mere purchases” of goods by
    customers in New Mexico, “even if occurring at regular intervals, are not enough to warrant
    a [s]tate’s assertion of in personam jurisdiction over a nonresident corporation in a cause of
    action not related to those purchase transactions.” Visarraga v. Gates Rubber Co., 
    104 N.M. 143
    , 147, 
    717 P.2d 596
    , 600 (Ct. App. 1986) (internal quotation marks and citation
    omitted). Applying the principles in Goodyear and Visarraga, we conclude that R&C’s
    reliance on the facts showing that Joy Co.’s products are available to consumers in New
    Mexico—either incorporated into bicycles or through distributors serving the state—by
    itself, does not create such systematic and continuous contacts so as to require Joy Co. to
    submit to general jurisdiction in New Mexico. Cf. Perkins v. Benguet Consol. Mining Co.,
    
    342 U.S. 437
    , 448 (1952) (holding that there was general jurisdiction over a foreign
    corporation that maintained an office in Ohio and made corporate decisions from that office).
    {15} The district court correctly determined that there were no facts demonstrating that
    Joy Co. has the requisite continuous and systematic contacts with New Mexico to confer
    general personal jurisdiction. However, that is not the end of our jurisdictional inquiry. We
    now consider whether the claim at issue arose out of Joy Co.’s purposeful contact with our
    state and, therefore, whether specific jurisdiction applies.
    2.      Specific Jurisdiction
    {16}    A state has specific jurisdiction over a nonresident defendant if that defendant’s
    6
    contacts do not rise to the level of general jurisdiction, but the defendant nevertheless
    “purposefully established contact with New Mexico.” Zavala, 2007-NMCA-149, ¶ 12
    (alteration, internal quotation marks, and citation omitted). In other words, “there [must] be
    some act by which the defendant purposefully avails itself of the privilege of conducting
    activities within the forum [s]tate, thus invoking the benefits and protections of its laws.”
    
    Hiatt, 117 N.M. at 464
    , 872 P.2d at 882 (internal quotation marks and citation omitted). The
    central feature of minimum contacts, then, is the requirement of purposeful availment. To
    determine “purposeful availment,” we look at what activities the defendant directed toward
    New Mexico. Zavala, 2007-NMCA-149, ¶ 11.
    {17} The United States Supreme Court has clarified that “specific jurisdiction is confined
    to adjudication of issues deriving from, or connected with, the very controversy that
    establishes jurisdiction.” Goodyear, ___ U.S. at ___, 131 S. Ct. at 2851 (internal quotation
    marks and citation omitted); see also 
    Visarraga, 104 N.M. at 146-47
    , 717 P.2d at 599-600
    (recognizing that for New Mexico to assert specific jurisdiction over a nonresident
    defendant, the plaintiff’s claim must “lie[] in the wake” of the defendant’s commercial
    activities in New Mexico (internal quotation marks and citation omitted)). Thus, the flow
    of a manufacturer’s products into the forum state through the stream of commerce may
    provide specific jurisdiction over a nonresident corporation. Goodyear, ___ U.S. at ___, 131
    S. Ct. at 2855. Whether or not personal jurisdiction exists over a particular defendant is
    decided on a case-by-case basis. See Gray v. Am. Radiator & Standard Sanitary Corp., 
    176 N.E.2d 761
    , 765 (Ill. 1961) (“The question cannot be answered by applying a mechanical
    formula or rule of thumb but by ascertaining what is fair and reasonable [under] the
    circumstances.”), abrogated on other grounds as recognized by Telular Corp. v. Mentor
    Graphics Corp., 
    282 F. Supp. 2d 869
    (N.D. Ill. 2003).
    {18} R&C argues that Joy Co. is subject to specific jurisdiction in New Mexico because
    it has purposefully availed itself of the protections and benefits of New Mexico law under
    the stream of commerce theory. In particular, R&C contends that Joy Co. established
    sufficient minimum contacts with New Mexico by placing the quick-release mechanism into
    the stream of commerce with the intent to distribute the product worldwide, including the
    United States.
    {19} We begin with the appropriate due process standard for determining personal
    jurisdiction on a stream of commerce theory. The United States Supreme Court has noted
    that “[t]he stream-of-commerce metaphor has been invoked frequently in lower court
    decisions permitting jurisdiction in products liability cases in which the product has traveled
    through an extensive chain of distribution before reaching the ultimate consumer.”
    Goodyear, ___ U.S. at ___, 131 S. Ct. at 2854-55 (internal quotation marks and citation
    omitted). While true, the Court’s most recent cases have provided no clear guidance
    regarding the scope and application of the theory, leaving little uniformity among the many
    different federal and state courts decisions. It is not surprising then, that in this case the
    parties and the district court each cited to a different United States Supreme Court opinion
    as the controlling decision for its argument and decision. R&C relied on World-Wide
    7
    Volkswagen, while Joy Co. turned to Justice Kennedy’s plurality opinion in J. McIntyre
    Machinery. The district court on the other hand relied on the stream of commerce theory set
    forth in Justice O’Connor’s plurality opinion in Asahi to find that personal jurisdiction did
    not exist over Joy Co. Because the United States Supreme Court’s splintered view of
    minimum contacts in Asahi and J. McIntyre Machinery provide no clear rule on this issue
    and because the plurality opinions in those cases are not the precedential holdings of the
    Court, a defendant’s contacts with New Mexico continue to be evaluated by the stream of
    commerce standard as described in World-Wide Volkswagen. We later explain in detail why
    we do not follow any of the rationales in Asahi or J. McIntyre Machinery.
    a.     World-Wide Volkswagen and New Mexico Law
    {20} The stream of commerce theory finds its origins in the United States Supreme Court
    decision in World-Wide Volkswagen. In World-Wide Volkswagen, the Court held that an
    Oklahoma court could not, consistent with the Due Process Clause, exercise jurisdiction over
    a nonresident automobile retailer and distributor “when the defendants’ only connection with
    Oklahoma is the fact that an automobile sold in New York to New York residents became
    involved in an accident in 
    Oklahoma.” 444 U.S. at 287
    . The Court reasoned that
    foreseeability that a product could cause injury in a state alone is insufficient to confer
    personal jurisdiction. 
    Id. at 295-96.
    However, the Court explained that personal jurisdiction
    may exist over a nonresident defendant that “delivers its products into the stream of
    commerce with the expectation that they will be purchased by consumers in the forum
    [s]tate.” 
    Id. at 297-98
    (emphasis added). Consequently, “if the sale of a product of a
    manufacturer . . . is not simply an isolated occurrence, but arises from the efforts of the
    manufacturer or distributor to serve directly or indirectly, the market for its product in other
    [s]tates, it is not unreasonable to subject it to suit in one of those [s]tates if its allegedly
    defective merchandise” injures someone there. 
    Id. at 297.
    {21} Our appellate courts have not had occasion to construe the stream of commerce
    theory in a products liability case since the United States Supreme Court decided Asahi in
    1987. However, we have decided several cases prior to the issuance of that opinion that
    illuminate the requirements for minimum contacts sufficient to establish personal jurisdiction
    in New Mexico courts. We recognize that none of our case law is directly on point;
    however, we believe that these cases can be useful and are consistent with the stream of
    commerce analysis set forth in World-Wide Volkswagen.
    {22} In Visarraga, we held that New Mexico courts could not assert jurisdiction over
    defendant Littlejohn’s Equipment Company, Inc. (Littlejohn), the secondary distributor of
    a defective 
    hose. 104 N.M. at 149
    , 717 P.2d at 602. The plaintiffs in that case sued the
    defendant after a tank truck making a delivery of gasoline to their gas station exploded and
    caught on fire. 
    Id. at 144,
    717 P.2d at 597. Littlejohn, a Colorado corporation, had
    purchased the hose from another Colorado corporation and then sold the hose to yet another
    company who installed the hose and sold the tank truck to Robinson Oil Company in New
    Mexico. 
    Id. at 145,
    717 P.2d at 598. In analyzing the jurisdictional issue, we relied on
    8
    World-Wide Volkswagen and its progeny to determine whether Littlejohn satisfied the
    constitutional due process requirements of purposeful availment. 
    Visarraga, 104 N.M. at 148-49
    , 717 P.2d at 601-02. We first noted the distinction between manufacturers and
    primary distributors who avail themselves of broad markets with known benefits and
    secondary distributors and local retailers whose contacts with the forum state are more
    attenuated. Id. at 
    149, 717 P.2d at 602
    . Because Littlejohn’s contact with New Mexico was
    “minimal and random in nature” and because it did not purposefully cause the hose at issue
    to be shipped into New Mexico, we ultimately held that the plaintiff failed to establish that
    Littlejohn had sufficient minimum contacts with New Mexico to subject it to personal
    jurisdiction. 
    Id. {23} In
    Roberts, the plaintiff’s estate sued three defendants after a plane crash that killed
    the 
    decedent. 100 N.M. at 365
    , 670 P.2d at 976. None of the defendants were located in
    New Mexico, and the question we had to answer was whether personal jurisdiction could be
    exercised over any of them. 
    Id. at 365-66,
    670 P.2d at 976-77. Although we concluded that
    jurisdiction did not exist over two of the defendants, we held that Custom Airmotive
    (Airmotive), an aviation repair shop located in Oklahoma, had the necessary minimum
    contacts with New Mexico to subject it to personal jurisdiction here. 
    Id. at 367-68,
    670 P.2d
    at 978-79. Specifically, the record established that Airmotive had advertised in national
    trade journals to solicit business, performed work for New Mexico residents, and
    purposefully availed itself of the benefits and protections of New Mexico law because it
    would have the right to sue a customer in our courts for failure to pay. 
    Id. Citing World-
    Wide Volkswagen, we said that Airmotive thus “should reasonably anticipate being haled
    into court here.” Roberts, 100 N.M. at 
    367-68, 670 P.2d at 978-79
    (internal quotation marks
    and citation omitted).
    {24} Our lone Supreme Court opinion dealing with the notion of minimum contacts was
    decided well before the United States Supreme Court’s decision in World-Wide Volkswagen.
    However, in Blount v. T D Publishing Corp., 
    77 N.M. 384
    , 
    423 P.2d 421
    (1966), our
    Supreme Court relied on that same line of cases that eventually became the basis of the
    World-Wide Volkswagen decision. In Blount, the plaintiffs brought suit against the
    defendants alleging invasion of 
    privacy. 77 N.M. at 386
    , 423 P.2d at 422. The New York
    publisher in that case sold its magazines to a New York distributor who in turn re-sold the
    magazines to a New Mexico wholesaler who distributed the products in the state. 
    Id. at 386-
    87, 423 P.2d at 423
    . The New Mexico Supreme Court recognized that in order to assert
    personal jurisdiction over the New York publisher, there had to be some act by which the
    publisher “purposefully avail[ed] itself of the privilege of conducting activities within the
    forum [s]tate.” 
    Id. at 391,
    423 P.2d at 426 (internal quotation marks and citation omitted).
    The Court held that the jurisdictional act demonstrating purposeful availment was not the
    creating of a defect but the nationwide distribution of defective products. 
    Id. at 390,
    423
    P.2d at 425. Articulating a liberal approach to purposeful availment, our Supreme Court
    reasoned that
    [w]hen a manufacturer voluntarily chooses to sell his product in a way which
    9
    will be resold from dealer to dealer, transferred from hand to hand and
    transported from state to state, he cannot reasonably claim that he is surprised
    at being held to answer in any state for the damage the product causes.
    
    Id. Thus, the
    regular distribution plan and the commercial benefit to the nonresident
    defendant, which it derived from the sale of its products, was sufficient to satisfy due process
    and subject the defendant to our courts. 
    Id. at 391,
    423 P.2d at 426; see also 
    Asahi, 480 U.S. at 117
    (Brennan, J., concurring) (“A defendant who has placed goods in the stream of
    commerce benefits economically from the retail sale of the final product in the forum [s]tate,
    and indirectly benefits from the [s]tate’s laws that regulate and facilitate commercial
    activity.”); 
    Gray, 176 N.E.2d at 764
    , 766-67 (holding that personal jurisdiction existed over
    a manufacturer of a component part manufactured in Ohio, incorporated into a product in
    Pennsylvania, that was ultimately sold in Illinois where it caused injury because, though the
    manufacturer did no business in Illinois, it could expect its product would be sold there and
    benefitted from the sale in the state); Soria v. Chrysler Canada, Inc., 
    958 N.E.2d 285
    , 296-
    97 (Ill. App. Ct. 2011) (continuing to rely on Gray for the distribution-channel rationale).
    {25} Both World-Wide Volkswagen and our New Mexico cases make clear that the mere
    foreseeability that a product may make its way into our state either by the act of a consumer
    or through a random or isolated sale is not enough to confer jurisdiction. Rather, there must
    be some act purposefully directed at the forum state. Thus, “the foreseeability that is critical
    to due process analysis is . . . that the defendant’s conduct and connection with the forum
    [s]tate are such that he should reasonably anticipate being haled into court there.” World-
    Wide 
    Volkswagen, 444 U.S. at 297
    .
    {26} Reaffirming a preference for Justice Brennan’s stream of commerce approach from
    World-Wide Volkswagen, we now turn to the facts in this case to determine whether R&C
    has made a prima facie case establishing that New Mexico may assert specific jurisdiction
    over Joy Co. under the stream of commerce theory of minimum contacts.
    b.      Joy Co.’s Contacts With New Mexico
    {27} R&C contends that the presence of the quick-release mechanisms on bicycles sold
    within New Mexico through the direct sales of such mechanisms to bicycle sellers in the
    United States is sufficient to establish that Joy Co. has sufficient minimum contacts under
    World-Wide Volkswagen to subject it to jurisdiction in New Mexico. Based on the
    undisputed facts in this case, we agree.
    {28} Joy Co. is a foreign corporation that has its principal places of business in Taiwan
    and China and operates under the laws of the Republic of China; Joy Co. designs bicycle
    component parts, including quick-release mechanisms and manufactures them at facilities
    in the Republic of China; and Joy Co. sells its products internationally to bicycle
    manufacturers through a network of agents and suppliers, including J&B Importers, Inc.
    (J&B). J&B, which is headquartered in Miami, Florida, is a distributor of bicycle parts in
    10
    the United States, and it serves the New Mexico market from its Denver, Colorado facility.
    R&C can order the component parts manufactured by Joy Co. by purchasing them from
    J&B. In addition, Joy Co.’s full-time marketing and sales employee who is located in
    California sells Joy Co. products as well as provides customer service and support to Joy
    Co.’s clients throughout the United States, including New Mexico.
    {29} Many bicycles sold by R&C have the Joy Co. quick-release mechanisms installed in
    them, and Joy Co. knows that the bicycles bearing their quick-release mechanism are sold
    worldwide. There is no dispute that Joy Co. manufactured the quick-release mechanism that
    was incorporated into Sproul’s bike and that R&C sold Sproul the GT bike with the Joy Co.
    quick-release mechanism at issue in 1988. In fact, at that time, many GT bikes had Joy Co.
    quick-release mechanisms, including bicycles sold at New Mexico retailers such as K-Mart.
    {30} Further, to the extent Joy Co.’s quick release mechanisms are sold in the United
    States, its manufacturing processes for the production of the item comply with the United
    States safety standards, and Joy Co. has “never tried not to comply” with the United States
    standard. Joy Co. does not avoid or prohibit the sale of its products in the United States,
    although it does specifically avoid selling its products in Central and South America.
    {31} Based on the above facts, Joy Co. manufactured the allegedly defective product and
    placed it into the stream of commerce. The quick-release mechanism was eventually sold
    to R&C, a New Mexico retailer, which then allegedly caused the injury to Sproul. We
    conclude that the manufacture and marketing by Joy Co., J&B, and now its California
    employee, as well as the ultimate sale, reflect more than a mere expectation that the product
    might be purchased by a resident in this forum. Rather, the quick-release mechanism that
    was incorporated into Sproul’s bicycle came to be in New Mexico due to the efforts of the
    “manufacturer or distributor to serve directly or indirectly” the market here. See World-Wide
    
    Volkswagen, 444 U.S. at 297
    . We believe that such directed efforts to the United States
    market reflect a purposeful intent to reach a consumer such as Sproul. Unlike the facts in
    World-Wide Volkswagen or Visarraga, this is not a situation involving a casual or accidental
    contact, and it is one that is directly related to the asserted cause of action in this case.
    {32} Joy Co.’s principal argument on appeal is that the district court correctly found that
    New Mexico could not exercise jurisdiction over it because it has never directed its activities
    specifically toward New Mexico, nor did it have any direct contact with the state or
    knowledge that its products would be incorporated into bikes specifically sold in New
    Mexico. We disagree. As an initial matter, we note that Joy Co. does not assess the question
    here against the standard set forth in World-Wide Volkswagen, opting instead to focus solely
    on Asahi and J. McIntyre Machinery. In any event, neither World-Wide Volkswagen nor our
    cases require that a manufacturer direct activities specifically at the forum state. Rather,
    World-Wide Volkswagen requires that the defendant place the product into the stream of
    commerce with the expectation that it will be purchased by users in the forum 
    state. 444 U.S. at 297-98
    . It is in the very nature of the stream of commerce theory of minimum
    contacts that a product will reach the forum state after a manufacturer has sold it in such a
    11
    way that it has passed from distributor to distributor to arrive there. Goodyear, ___ U.S. at
    ___, 131 S. Ct. at 2855; Blount, 77 N.M. at 
    390, 423 P.2d at 425
    . To insulate a foreign
    manufacturer of an allegedly defective component part that has caused injury in our state,
    unless it specifically targeted New Mexico or knew that its product will ultimately be resold
    here, defies logic. See A. Uberti & C. v. Leonardo, 
    892 P.2d 1354
    , 1362-63 (Ariz. 1995) (in
    banc) (stating that “a foreign manufacturer that knowingly and intentionally distributes its
    products in America through an American company [cannot] avoid jurisdiction of American
    courts by the simple expedient of closing its eyes and making no effort to learn about or
    restrict its distributor’s activities”). Accordingly, we conclude that a manufacturer of an
    allegedly defective component part that has otherwise placed it into a distribution channel
    with the expectation it will be sold in our national market cannot be insulated from liability
    simply because it does not specifically target or know its products are being marketed in
    New Mexico. See Bean Dredging Corp. v. Dredge Tech. Corp., 
    744 F.2d 1081
    , 1082-83
    (5th Cir. 1984) (holding that personal jurisdiction existed over the manufacturer of a
    component part where it did not originate or control the distribution system of its product
    but did not seek to limit the states in which it would be used or sold); Nelson v. Park Indus.,
    Inc., 
    717 F.2d 1120
    , 1127 (7th Cir. 1983) (holding that it was reasonable to assert personal
    jurisdiction over a foreign manufacturer when they knew their product would be sold by a
    distributor throughout the United States).
    {33} Joy Co. cites much authority from other jurisdictions requiring that a defendant take
    additional acts directed at the forum state or have actual knowledge that its products are
    marketed there. See Windsor v. Spinner Indus. Co., 
    825 F. Supp. 2d 632
    , 639-40 (D. Md.
    2011) (finding no personal jurisdiction over the defendant because the Fourth Circuit
    requires forum-specific activity); Dickie v. Cannondale Corp., 
    905 N.E.2d 888
    , 892-93 (Ill.
    App. Ct. 2009) (finding no personal jurisdiction over a foreign bicycle pedal manufacturer
    that sold its products to a distributor and knew its parts were sold in the United States
    because it had no downstream control); Morris v. Halsey Enters. Co., 
    882 N.E.2d 1079
    ,
    1083-84 (Ill. App. Ct. 2008) (finding no personal jurisdiction over a foreign ceiling fan
    manufacturer that sold its products to a distributor and knew the products would be sold to
    large retailers throughout the United States but did not specifically know they would be sold
    in Illinois). Joy Co.’s reliance on these cases is misplaced as they were all decided by
    applying the multiple Asahi opinions. Because the different standard set forth in World-
    Wide Volkswagen continues to be applied, we do not discuss those cases here.
    {34} Sufficient facts exist in this case to determine that Joy Co. purposefully directed its
    activities toward the United States market and, as a result, toward the New Mexico market
    as well. R&C has made a prima facie case establishing that Joy Co. has sufficient minimum
    contacts with New Mexico through its distribution system to subject it to personal
    jurisdiction in our courts. We next analyze whether it would be reasonable to assert specific
    personal jurisdiction over Joy Co.
    c.     Traditional Notions of Fair Play and Substantial Justice
    12
    {35} Having established that Joy Co. has delivered its product into the stream of
    commerce, we now turn to the issue of reasonableness. The United States Supreme Court
    has held that even if a defendant has established sufficient minimum contacts with the forum
    state, the Due Process Clause forbids the assertion of personal jurisdiction over that
    defendant “under circumstances that would offend traditional notions of fair play and
    substantial justice.” 
    Asahi, 480 U.S. at 113
    (internal quotation marks and citation omitted).
    To determine whether it is reasonable to exercise personal jurisdiction in each case, we
    consider five factors. Id.; Zavala, 2007-NMCA-149, ¶ 12. We balance the burden on the
    defendant, New Mexico’s interest, the plaintiff’s interest in obtaining relief, the interest in
    the efficient resolution of controversies, and the interest in promoting public policy. 
    Asahi, 480 U.S. at 113
    ; Zavala, 2007-NMCA-149, ¶ 12.
    {36} Joy Co. advances only one argument on appeal: that it would be unduly burdened
    by being forced to defend this action in a foreign legal system. However, Joy Co. fails to
    provide any facts to support their argument that defending this case in New Mexico would
    be unduly burdensome except to say that is so. We recognize that there may be
    circumstances in which it would be unreasonable to require a foreign defendant whose only
    connection with the forum state is through the stream of commerce to defend itself in New
    Mexico courts. However, unlike the hypothetical defendants in Justice Breyer’s J. McIntyre
    Machinery concurrence, Joy Co. is not a small farmer or cottage industry potter in a faraway
    country or state. See J. McIntyre Mach., ___ U.S. at ___, 131 S. Ct. at 2794 (Breyer, J.,
    specially concurring). Nor is Joy Co. like the Japanese manufacturer of component parts in
    Asahi whose only connection with the United States was that its component parts were
    incorporated into another product abroad and then sold throughout the United 
    States. 480 U.S. at 112-13
    . Joy Co. is an international manufacturer with recent annual revenues
    between thirty-seven and forty-six million dollars. It currently does business directly with
    six United States bicycle manufacturers, and since 2009, has had an employee located in
    California. In 2009 and 2010, Joy Co. attended a trade show in Nevada. And since 2006
    and 2008 respectively, Joy Co. has held two United States patents. These facts demonstrate
    that Joy Co. currently conducts activities that open it to litigation in the United States and
    through which it avails itself of our laws. In order to defend its patents or enter contracts
    with its United States clients, Joy Co. necessarily employs the legal system of particular
    states and of the United States. Although we acknowledge defending a suit in New Mexico
    would impose some burden on any nonresident, based on Joy Co.’s current activities in the
    United States, we conclude that burden on it is slight.
    {37} In contrast, R&C contends that its interest in indemnification against Joy Co. is great.
    R&C also argues that New Mexico has a clear interest in resolving claims arising from
    injuries occurring here as the result of defective products sold or supplied by foreign
    manufacturers that profit from the sale of their product to New Mexico consumers. We
    agree. R&C’s interest in obtaining relief is manifest, and its assertions are consistent with
    the policies embodied in our long-arm statute. Joy Co. manufactured the quick-release
    mechanism at issue, and it is thus the party ultimately responsible for the allegedly defective
    product. Because the burden of defending in the foreign legal system is slight in comparison
    13
    to R&C’s and New Mexico’s interest, the district court erred in finding that it is
    unreasonable to assert personal jurisdiction over Joy Co.
    d.     Declining to Apply Asahi or J. McIntyre Machinery
    {38} As we have noted, the district court in this case relied on Asahi in finding that it
    could not exercise specific personal jurisdiction over Joy Co. The district court
    acknowledged the “split view of the ‘stream of commerce doctrine’” from that of World-
    Wide Volkswagen but nevertheless adopted the stream of commerce plus test set forth in
    Asahi. Joy Co. on the other hand relies on the United States Supreme Court’s recent
    decision in J. McIntyre Machinery in which a plurality of the Court rejected the “national
    stream of commerce” theory as a basis for personal jurisdiction. We discuss the Court’s
    multiple rationales in these cases and explain why the stream of commerce theories in either
    Asahi or J. McIntyre Machinery are not adopted here.
    {39} In Asahi, the United States Supreme Court issued a fractured decision outlining
    competing versions of the stream of commerce theory. 
    480 U.S. 102
    . The case arose out
    of a motorcycle accident, and the motorcycle rider filed suit against Cheng Shin Rubber
    Industrial Co., Ltd. (Cheng Shin), the Taiwanese manufacturer of the motorcycle tube. 
    Id. at 105-06.
    Cheng Shin filed a cross-complaint against Asahi Metal Industry Co. (Asahi), the
    manufacturer of the tube’s valve assembly. 
    Id. at 106.
    The plaintiff’s claim settled, and only
    Cheng Shin’s complaint against Asahi remained. 
    Id. Although the
    Justices unanimously
    held that exercising jurisdiction over Asahi would “offend traditional notions of fair play and
    substantial justice,” they disagreed on whether Asahi has sufficient minimum contacts with
    the forum. 
    Id. at 113-14,
    116, 121 (internal quotation marks and citation omitted). Justice
    O’Connor, writing for a four-Justice plurality, asserted that “[t]he placement of a product
    into the stream of commerce, without more, is not an act of the defendant purposefully
    directed toward the forum [s]tate.” 
    Id. at 112.
    Instead, there must be “an action of the
    defendant purposefully directed toward the forum [s]tate.” 
    Id. Justice O’Connor
    then
    explained,
    Additional conduct of the defendant may indicate an intent or purpose to
    serve the market in the forum [s]tate, for example, designing the product for
    the market in the forum [s]tate, advertising in the forum [s]tate, establishing
    channels for providing regular advice to customers in the forum [s]tate, or
    marketing the product through a distributor who has agreed to serve as the
    sales agent in the forum [s]tate. But a defendant’s awareness that the stream
    of commerce may or will sweep the product into the forum [s]tate does not
    convert the mere act of placing the product into the stream into an act
    purposefully directed toward the forum [s]tate.
    
    Id. Applying this
    reasoning to Asahi, Justice O’Connor concluded that exercising personal
    jurisdiction over the company would violate due process because there was no evidence of
    any action by Asahi to purposefully avail itself of the California market. 
    Id. at 112-13.
    14
    {40} Justice Brennan, writing for another four-Justice plurality, saw “no need” for a
    showing of additional conduct directed toward the forum when the defendant is aware that
    the stream of commerce may or will “sweep the product into the forum [s]tate.” 
    Id. at 116-
    17 (Brennan, J., concurring) (internal quotation marks and citation omitted). Instead, Justice
    Brennan viewed the stream of commerce as “the regular and anticipated flow of products
    from manufacture to distribution to retail sale” rather than as simply “unpredictable currents
    or eddies.” 
    Id. at 117
    (Brennan, J., concurring). Accordingly, the facts in Asahi were
    sufficient to establish minimum contacts because Asahi was “aware of the distribution
    system’s operation, and it knew that it would benefit economically from the sale in
    California of products incorporating its components.” 
    Id. at 121
    (Brennan, J., concurring)
    (internal quotation marks and citation omitted). Justice Stevens, writing separately and
    joined by Justices White and Blackmun, first stated that the examination of minimum
    contacts was unnecessary in light of the Court’s determination that exercise of jurisdiction
    over Asahi would be unreasonable and unfair. 
    Id. at 121
    (Stevens, J., concurring). In
    concluding that the minimum contacts part of the test had been satisfied, Justice Stevens
    criticized the plurality for assuming that a clear line can be drawn between awareness that
    a part will reach the forum state and purposeful availment of the forum market. 
    Id. at 122
    (Stevens, J., concurring). According to Justice Stevens, whether or not Asahi’s conduct
    constituted purposeful availment required an examination of the volume, value, and
    hazardous character of the products. 
    Id. (Stevens, J.
    , concurring). Given the facts
    considered necessary by Justice Stevens, the Asahi opinion arguably supports a finding that
    there were sufficient minimum contacts based on the stream of commerce theory. However,
    the dueling Asahi opinions have done little more than provide a muddled rubric for deciding
    stream of commerce cases involving nonresident corporations and nowhere has that been
    more evident than in lower court decisions. For example, some federal and state courts have
    applied Justice Brennan’s more broad stream of commerce approach. See, e.g., State v. NV
    Sumatra Tobacco Trading, Co., 
    666 S.E.2d 218
    , 223 (S.C. 2008) (finding personal
    jurisdiction under broad stream of commerce theory where the defendant’s “actions indicate
    that it purposely availed itself of conducting business in all 50 states, including South
    Carolina”); Kopke v. A. Hartrodt S.R.L., 
    629 N.W.2d 662
    , 674 (Wis. 2001) (“We believe the
    stream of commerce theory as set forth by Justice Brennan is the correct analysis to apply
    to the case at hand.”). Others have opted for Justice O’Connor’s stream of commerce plus
    test. See, e.g., Bridgeport Music, Inc. v. Still N The Water Publ’g, 
    327 F.3d 472
    , 479-80 (6th
    Cir. 2003) (expressing “preference” for Justice O’Connor’s approach and applying it to the
    case); Lesnick v. Hollingsworth & Vose Co., 
    35 F.3d 939
    , 944-46 (4th Cir. 1994) (taking
    approach similar to that of Justice O’Connor). Still others choose to apply both Asahi
    approaches. See, e.g., Pennzoil Prods. Co. v. Colelli & Assocs., Inc., 
    149 F.3d 197
    , 205-07
    (3d Cir. 1998) (taking approaches articulated by both Justices O’Connor and Brennan);
    Wiles v. Morita Iron Works Co., 
    530 N.E.2d 1382
    , 1389 (Ill. 1988) (noting that “[u]nder
    either interpretation of the stream of commerce theory, it is clear that purposeful availment
    of the forum’s market requires, at a minimum, that the alien defendant is aware that the final
    product is being marketed in the forum [s]tate.” (emphasis, internal quotation marks, and
    citation omitted)). And, finally, some courts decline to follow either approach and continue
    to follow World-Wide Volkswagen. See, e.g., Irving v. Owens-Corning Fiberglas Corp., 864
    
    15 F.2d 383
    , 386 (5th Cir. 1989) (“Because the Court’s splintered view of minimum contacts
    in Asahi provides no clear guidance on this issue, we continue to gauge [the defendant’s]
    contacts with Texas by the stream of commerce standard as described in World-Wide
    Volkswagen and embraced in this circuit.”). In the most recent case before it, the expectation
    that the United States Supreme Court would articulate a clear rule and workable standard in
    stream of commerce cases did not materialize, and the issue continues to remain unclear.
    We explain.
    {41} After a twenty-four-year hiatus, the United States Supreme Court returned to the
    stream of commerce theory last year in J. McIntyre Machinery, ___ U.S. at ___, 131 S. Ct.
    at 2783. J. McIntyre Machinery, Ltd. (McIntyre) is an English corporation that contracted
    with an independent United States company to sell its machines in the United States. Id. at
    ___, 131 S. Ct. at 2786. Although it appears that four machines ended up in New Jersey, the
    Court noted that the record suggests only one machine ended up there. 
    Id. Robert Nicastro
    filed suit in New Jersey state court after he injured his hand while using one of McIntyre’s
    machines. 
    Id. The United
    States Supreme Court reversed the New Jersey Supreme Court,
    which held that due process permitted the exercise jurisdiction over McIntyre. Id. at ___,
    131 S. Ct. at 2785. Justice Kennedy, writing for Chief Justice Roberts and Justices Scalia
    and Thomas, explained that when a defendant places its goods in the stream of commerce
    and they are sold to a person in the forum state, “[t]he principal inquiry . . . is whether the
    defendant’s activities manifest an intention to submit to the power of a sovereign.” Id. at
    ___, 131 S. Ct. at 2788. In other words, “[t]he defendant’s transmission of goods permits
    the exercise of jurisdiction only where the defendant can be said to have targeted the forum;
    as a general rule, it is not enough that the defendant might have predicted that its goods will
    reach the forum [s]tate.” 
    Id. Under this
    theory, therefore, a defendant who targets the
    United States market as a whole but not the market of any particular state can avoid being
    subject to jurisdiction in any state for actions arising under state law. Applying this
    principle, Justice Kennedy recognized that although McIntyre directed marketing and sales
    at the United States market, it did not purposefully avail itself of the New Jersey market. Id.
    at ___, 131 S. Ct. at 2790. Consequently, the Court concluded that exercise of personal
    jurisdiction would violate due process. Id. at ___, 131 S. Ct. at 2791.
    {42} Justices Breyer and Alito concurred in the judgment but for different reasons. Justice
    Breyer noted that none of the Court’s precedents found that a single, isolated sale of a good
    in the forum state was constitutionally sufficient to confer personal jurisdiction. Id. at ___,
    131 S. Ct. at 2792 (Breyer, J., concurring). In this instance, there was no regular course of
    sales to New Jersey, precluding a finding of jurisdiction even under Justice Brennan’s stream
    of commerce theory. 
    Id. (Breyer, J.
    , concurring). Therefore, Justice Breyer concluded that
    the case could be decided based on precedent and without “making broad pronouncements
    that refashion basic jurisdictional rules.” Id. at ___, 131 S. Ct. at 2792-93 (Breyer, J.,
    concurring).
    {43}    Justices Ginsburg, Sotomayor, and Kagan dissented, taking a more expansive
    approach to the due process requirements for the exercise of personal jurisdiction. Justice
    16
    Ginsburg first criticized the plurality, stating that, “the plurality’s notion that consent is the
    animating concept draws no support from controlling decisions of this Court.” Id. at ___,
    131 S. Ct. at 2799 (Ginsburg, J., dissenting). Instead, “[t]he modern approach to jurisdiction
    over corporations and other legal entities, ushered in by International Shoe, gave prime place
    to reason and fairness.” J. McIntyre Mach., ___ U.S. at ___, 131 S. Ct. at 2800 (Ginsburg,
    J., dissenting). Here, McIntyre availed itself of the United States market nationwide, “not
    a market in a single [s]tate or a discrete collection of [s]tates.” See id. at ___, 131 S. Ct. at
    2801 (Ginsburg, J., dissenting). Justice Ginsburg further explained that this suit was
    distinguishable from Asahi, because Asahi, unlike McIntyre, did not seek out customers in
    the United States or engage distributors to promote its products in the United States. J.
    McIntyre Mach., ___ U.S. at ___, 131 S. Ct. at 2803 (Ginsburg, J., dissenting). In addition,
    Asahi manufactured component parts “with little control over the final destination of its
    products”; McIntyre, in contrast, sold finished products. 
    Id. (Ginsburg, J.
    , dissenting)
    (internal quotation marks and citation omitted). Consequently, Justice Ginsburg “would hold
    McIntyre UK answerable in New Jersey for the harm Nicastro suffered at his workplace in
    that [s]tate using McIntyre UK’s shearing machine.” Id. at ___, 131 S. Ct. at 2804
    (Ginsburg, J., dissenting).
    {44} Because J. McIntyre Machinery did not produce a majority opinion adopting either
    Justice O’Connor’s or Justice Brennan’s stream of commerce theory, and given Justice
    Breyer’s reliance on current United States Supreme Court precedent, pre-Asahi case law
    utilizing the approach set forth in World-Wide Volkswagen remains binding in New Mexico.
    This approach requires us simply to adhere to our precedents, at least until the United States
    Supreme Court resolves the twenty-five-year-old uncertainty over whether stream of
    commerce theory is sufficient to establish the required minimum contacts and, if so, how it
    should be applied. For these reasons, the district court decision applying Justice O’Connor’s
    stream of commerce plus approach from Asahi was in error. Joy Co.’s view that the proper
    approach to applying the minimum contacts test is to follow Justice Kennedy’s plurality
    opinion in J. McIntyre Machinery is also rejected.
    IV.     CONCLUSION
    {45} Viewing the facts in a light most favorable to R&C, Joy Co.’s conduct and activities
    directed at the forum state are sufficient to establish a prima facie showing that personal
    jurisdiction is proper under the New Mexico long-arm statute and consistent with the
    requirements of federal due process. We reverse the district court’s decision and remand for
    further proceedings.
    {46}    IT IS SO ORDERED.
    ____________________________________
    LINDA M. VANZI, Judge
    RODERICK T. KENNEDY, Judge (dissenting).
    17
    MICHAEL E. VIGIL, Judge (specially concurring).
    VIGIL, Judge (specially concurring).
    {47} I agree that Joy Co.’s conduct and activities are sufficient to confer specific
    jurisdiction on the New Mexico district court to decide R&C’s claim for indemnification
    against Joy Co. In my opinion, however, this case does not require us to “reject” or “adopt”
    any views expressed by the United States Supreme Court. Accordingly, I specially concur.
    {48} The question presented in this case is whether Joy Co. has purposefully availed itself
    of the privilege of conducting activities within New Mexico, thereby invoking the protection
    of its laws, and whether the claim for indemnification brought by R&C against Joy Co. arises
    out of Joy Co.’s activities in New Mexico. See J. McIntyre Mach., ___ U.S. at ___, 131 S.
    Ct. at 2787-88. Two general views have emerged in the analysis of whether a non-resident
    is subject to the jurisdiction of a state court consistent with due process. Both views
    command agreement of four justices, while neither commands agreement of a majority.
    These are Justice Brennan’s view, and Justice O’Connor’s view, both of which are expressed
    in Asahi, which was decided by a plurality opinion.
    {49} I refer to Justice Brennan’s view as the “stream of commerce” view. Under this
    view:
    The stream of commerce refers not to unpredictable currents or eddies, but
    to the regular and anticipated flow of products from manufacture to
    distribution to retail sale. As long as a participant in this process is aware
    that the final product is being marketed in the forum State, the possibility of
    a lawsuit there cannot come as a surprise. Nor will the litigation present a
    burden for which there is no corresponding benefit. A defendant who has
    placed goods in the stream of commerce benefits economically from the
    retail sale of the final product in the forum State, and indirectly benefits from
    the State’s laws that regulate and facilitate commercial activity. These
    benefits accrue regardless of whether that participant directly conducts
    business in the forum State, or engages in additional conduct directed toward
    that State.
    
    Asahi, 480 U.S. at 117
    (Brennan J., concurring). Thus, if a defendant is aware, or could have
    foreseen, that its product would ultimately be sold in a state in the stream of commerce, it
    is subject to personal jurisdiction in that state. 
    Id. {50} I
    refer to Justice O’Connor’s view as the “purposefully directed” test. Under this
    view:
    The ‘substantial connection’ between the defendant and the forum State
    necessary for a finding of minimum contacts must come about by an action
    18
    of the defendant purposefully directed toward the forum State. The
    placement of a product into the stream of commerce, without more, is not an
    act of the defendant purposefully directed toward the forum State.
    
    Asahi, 480 U.S. at 112
    (emphasis, internal quotation marks, and citations omitted). This
    view rejects foreseeability as the standard and instead requires a defendant to take some
    deliberate and overt action to target the market in the forum state. 
    Id. {51} J.
    McIntyre Machinery is the most recent opinion of the United States Supreme Court
    addressing personal jurisdiction, and it was also decided by a plurality opinion. Speaking
    for four justices, Justice Kennedy states:
    [P]ersonal jurisdiction requires a forum-by-forum, or sovereign-by sovereign,
    analysis. The question is whether a defendant has followed a course of
    conduct directed at the society or economy existing within the jurisdiction of
    a given sovereign, so that the sovereign has the power to subject the
    defendant to judgment concerning that conduct.
    ___U.S. at ___, 131 S. Ct. at 2789.
    {52} Judge Vanzi has fairly summarized the facts in ¶¶ 27-31; 36, and they do not need
    repeating here. Those facts clearly establish compliance with Justice Brennan’s “stream of
    commerce” test. The facts also satisfy Justice O’Connor’s “purposefully directed” test.
    Through its marketing and distributing scheme, Joy Co. clearly targeted New Mexico as a
    state in which contractual duties and obligations—the basis for the indemnity claim—would
    be undertaken. The fact that Joy Co. itself does not enter into New Mexico is not
    dispositive. Summarizing existing case law in J. McIntyre Machinery, Justice Kennedy
    states, “a defendant may in an appropriate case be subject to jurisdiction without entering
    the forum—itself an unexceptional proposition—as where manufacturers or distributors
    ‘seek to serve’ a given State’s market.” Id. at ___, 131 S. Ct. at 2788 (citations omitted).
    Specific, concrete examples set forth in Justice O’Connor’s opinion which demonstrate an
    intent or purpose to serve the market in the forum state include, “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.” 
    Asahi, 480 U.S. at 112
    . Those conditions are plainly present in this case. Finally, I submit that the facts
    satisfy the view expressed in J. McIntyre Machinery. Specifically, the facts demonstrate that
    through its marketing and distributing scheme, Joy Co. has engaged in a course of conduct
    directed at the economy existing within New Mexico.
    {53} For the foregoing reasons, I do not believe it is necessary to “decline” to apply Asahi
    or J. McIntyre Machinery as proposed by Judge Vanzi. However, since I believe that under
    our standard of review, the facts herein satisfy both Asahi and J. McIntyre Machinery, I
    specially concur in the result reached.
    19
    ____________________________________
    MICHAEL E. VIGIL, Judge
    KENNEDY, Judge (concurring in part and dissenting in part).
    {54} I agree that there is no general jurisdiction to be exercised with regard to Joy Co. I
    respectfully disagree with the Majority that New Mexico has specific jurisdiction to entertain
    this indemnity claim. I believe the Opinion’s liberal approach is excessively broad. Placing
    goods in the worldwide stream of commerce, together with a general awareness that products
    delivered to distributors elsewhere might land in New Mexico, should not suffice for
    “purposeful availment” of the benefits and protections of New Mexico’s legal system. I am
    not satisfied that such an approach possesses the degree of certainty and predictability to
    reliably establish a manufacturer’s relationship with New Mexico as a foreign state.
    {55} I would use a test requiring behavior on Joy Co.’s part that was more demonstrably
    “purposefully directed” at New Mexico by Joy Co. and not just an artifact of Joy Co. being
    at the front end of a convoluted distribution chain that brought a bicycle part to our state.
    See 
    Asahi, 480 U.S. at 112
    . The focus should be on Joy Co.’s actions in their business that
    are directed toward New Mexico, not a nebulous post hoc imputation of their expectations
    deriving from where their product might turn up. The Opinion’s selective approach to
    specific jurisdiction adopts Justice Brennan’s solo dissent in World-Wide Volkswagen, where
    his opinion loosed more limited and amorphous criteria for jurisdiction that “the litigation
    is connected to the forum, the defendant is linked to the forum, and the burden of defending
    is not 
    unreasonable,” 444 U.S. at 302
    . There, Justice Brennan rejected any consideration of
    how a distribution chain might operate to bring goods into the state, or whether goods
    arrived at the end of a long distribution chain over which no control might be exerted by the
    manufacturer. Rather, he opined that no more need be required of a defendant than“[i]n each
    case the seller purposefully injects the goods into the stream of commerce and those goods
    predictably are used in the forum 
    [s]tate.” 444 U.S. at 307
    .
    {56} The standard enunciated by Justice O’Connor in Asahi is one I believe to be very
    much alive and requires a showing that Joy Co. also “purposefully avail[ed] itself of the
    privilege of conducting activities within the forum [s]tate” and, thereby, “invoke[ed] the
    benefits and protections of its laws.” Hanson v. Denckla, 
    357 U.S. 235
    , 253 (1958). This
    is not a products liability case against Joy Co. It is a claim by a bicycle store for indemnity
    from the maker of a bicycle component that may have failed in a fifteen-year-old bicycle.
    A court may exercise specific jurisdiction when (1) the defendant purposely directed its
    activities toward the forum state or purposely availed itself of the privileges of conducting
    activities there, and (2) the controversy arises out of or is related to the defendant’s contacts
    with the forum state. Helicopteros Nacionales de Colombia, S.A. v. Hall, 
    466 U.S. 408
    , 414
    (1984). The arrival of Joy Co’s bicycle part in New Mexico was an incidental contact with
    New Mexico and insufficiently purposeful to justify invoking our specific jurisdiction.
    20
    {57} Last year, the United States Supreme Court once again visited this cratered battlefield
    of plurality jurisprudence and managed to forge an agreement between six justices as to two
    propositions that are applicable here. J. McIntyre Mach., ___ U.S. ___, 
    131 S. Ct. 2780
    .
    First, the stream of commerce notion alone, even to the extent that it is employed to paint a
    satisfying gloss of foreseeability on the arrival of a product within a particular jurisdiction,
    is not enough to sufficiently protect the due process right of Joy Co. “not to be coerced
    except by lawful judicial power.” Id. at ___, 131 S. Ct. at 2785. This requires “some act”
    of Joy Co., by which it availed itself of the privilege of conducting activities within the
    forum state that invokes the benefits and protections of its laws. See id. at ___, 131 S. Ct.
    at 2787. A specific effort to sell in the forum state, purposeful availment of the privilege of
    doing business in the forum state and the expectation that one’s goods will be purchased in
    the forum state constitute the points of agreement in which the plurality’s opinion was joined
    by the two concurring justices, giving a six-justice majority to the inapplicability of mere
    stream of commerce and foreseeability as sufficient to confer special jurisdiction. Id. at ___,
    131 S. Ct. at 2792.
    {58} This is not the loose approach taken by the Opinion in this case that conflates
    foreseeability with expectation and then availment. It also does not allow for the conflation
    of Joy Co. seeking to serve the United States market with purposeful intent to reach the New
    Mexico consumer. Such a view of an intent to reach the consumer is not the test we should
    use, but rather we should look to purposeful intent to utilize the benefits and protections of
    the forum upon which the Opinion should focus. It is specifically this relationship with the
    forum that requires the application of due process, and purposeful availment requires an act
    by Joy Co. “purposefully directed toward the forum [s]tate” and not merely an awareness or
    an intention born of using nationwide distribution networks. 
    Asahi, 480 U.S. at 112
    . In
    Hanson, that involved acting so as to gain the “privilege of conducting activities within the
    forum [s]tate, thus invoking the benefits and protections of its 
    laws.” 357 U.S. at 253
    . In
    this case, Joy Co. has not purposefully pursued its contacts with New Mexico in a way that
    it might benefit from the protection of our laws, but rather the other way around. A New
    Mexico entity seeks to use New Mexico law for its own benefit and protection.
    {59} Both the plurality and Justice Breyer’s concurrence rejected the notion that a desire
    for an American distributor to sell its product to any willing customer in the United States,
    and participation in trade shows were facts that adequately supported finding minimum
    contacts between a manufacturer and a state. J. McIntyre Mach., ___ U.S. at ___, 131 S. Ct.
    at 2790-91. Joy Co. has no representatives in New Mexico, and none of its products reach
    our state save through a Denver distributor, or through the inclusion of its parts by bicycle
    manufacturers who avail themselves of downstream distributors. R&C’s manager never
    established that he has ever independently ordered a Joy Co. component through the Denver
    distributor for sale in New Mexico, and no direct sale from Joy Co.’s representative in
    California was documented. Justice Stevens’ concurrence in Asahi evidenced no more than
    an inclination that the minimum contacts part of the test had been satisfied, but usefully
    outlined some circumstances echoed later in J. McIntyre Machinery that could be relevant
    to determining a company’s contacts with the forum state, including the volume of sales, the
    21
    value of the goods, and the hazardous character of the components. 
    Asahi, 480 U.S. at 122
    ;
    J. McIntyre Mach., ___ U.S. at ___, 131 S. Ct. at 2790, 2793. Here, the value and volume
    of sales seems minimal, and the items are not inherently dangerous so as to anticipate their
    causing injury.
    {60} Viewing a worldwide pool of commercial transactions so as to confer upon every
    manufacturer a specific intention to do business within every jurisdiction, and moreover
    impute a corporate anticipation of being haled into the courts of New Mexico as a result is
    a siren’s call I believe more sensible jurisprudence requires me to reject. The Majority and
    I do not agree that Asahi and later cases, such as J. McIntyre Machinery, owing to their
    multiple pluralities of opinion, have limited relevance to this situation. I believe that World-
    Wide Volkswagen has indeed evolved to provide a more sophisticated view of specific
    jurisdiction that would support affirming the district court in this case. With the frequent
    reliance placed on Asahi by the majority opinion to glean selected precepts, the broader view
    of development through J. McIntyre Machinery is one I find more satisfying to resolve the
    jurisdictional question posed by this case. Hence, I believe that Joy Co.’s connection with
    New Mexico is too attenuated to support specific jurisdiction, requiring some additional
    factor or act on Joy Co.’s part than simply having a marketable item in the “stream of
    commerce” and an imputed awareness that it would arrive in New Mexico is a better
    standard.
    {61} I view Justice Breyer’s concurrence in J. McIntyre Machinery as quite explicit in
    rejecting any jurisdiction based on no more than a producer being subject to jurisdiction “so
    long as it knows or reasonably should know that its products are distributed through a
    nationwide distribution system that might lead to those products being sold in any of the fifty
    states.” ___ U.S. at ___, 131 S. Ct. at 2785. His precise reasoning was that, to adopt such
    a stream of commerce approach, would be to ignore “the relationship between the defendant,
    the forum, and the litigation.” Id. at ___, 131 S. Ct. at 2793. In a case such as this, where
    the distribution chain seems to begin with Joy Co.’s contacts outside of the United States and
    no direct line between Joy Co. and New Mexico exists, I would not take jurisdiction based
    on little more than their part showing up in a bicycle fifteen years ago.
    {62}   I respectfully dissent.
    ____________________________________
    RODERICK T. KENNEDY, Judge
    Topic Index for Sproul v. Rob & Charlie’s, Inc., No. 31,167
    APPEAL AND ERROR
    Standard of Review
    CIVIL PROCEDURE
    Motion to Dismiss
    22
    Summary Judgment
    CONSTITUTIONAL LAW
    Due Process
    JURISDICTION
    Jurisdiction, General
    Long-Arm Statute
    Minimum Contacts
    Personal
    NEGLIGENCE
    Indemnification
    Personal Injury
    TORTS
    Products Liability
    23
    

Document Info

Docket Number: 31,167

Filed Date: 8/15/2012

Precedential Status: Precedential

Modified Date: 3/3/2016

Authorities (31)

A. UBERTI & C. v. Leonardo in & for PIMA ( 1995 )

pennzoil-products-company-v-colelli-associates-inc-pyramid-treating ( 1998 )

telina-nelson-a-minor-by-cindra-r-carson-guardian-ad-litem-gerald ( 1983 )

bean-dredging-corporation-v-dredge-technology-corporation-v ( 1984 )

Bridgeport Music, Inc. v. Still N the Water Publishing, ... ( 2003 )

Beverly Lesnick, Individually and as Personal ... ( 1994 )

Tercero v. ROMAN CATH. DIOCESE OF NORWICH ( 2002 )

Gray v. American Radiator & Standard Sanitary Corp. ( 1961 )

Wiles v. Morita Iron Works Co. ( 1988 )

Morris v. HALSEY ENTERPRISES CO., LTD. ( 2008 )

Dickie v. Cannondale Corp. ( 2009 )

Soria v. Chrysler Canada, Inc. ( 2011 )

Windsor v. SPINNER INDUSTRY CO., LTD. ( 2011 )

Telular Corp. v. Mentor Graphics Corp. ( 2003 )

Roberts v. Piper Aircraft Corp. ( 1983 )

United Nuclear Corp. v. General Atomic Co. ( 1976 )

Visarraga v. Gates Rubber Co. ( 1986 )

Sublett v. Wallin ( 2004 )

Zavala v. El Paso County Hospital District ( 2007 )

Blount Ex Rel. Dearholt v. T D Publishing Corp. ( 1966 )

View All Authorities »