Asahi Metal Industry Co. v. Superior Court of California

Gary Zurcher was injured in a motorcycle accident in California allegedly caused by a defective tire tube. Zurcher sued Cheng Shin, the Taiwanese manufacturer of the tube, in California state court. Cheng Shin filed a cross-complaint for indemnification against Asahi Metal, a Japanese company that manufactured the tire tube's valve assembly. Asahi's valve assemblies were sold to Cheng Shin in Taiwan, and some of the finished tubes containing those valves eventually reached California through the stream of commerce.

Justice O'Connor, writing for a plurality of four, argued that mere awareness that a product might reach the forum through the stream of commerce is not enough; the defendant must take additional actions directed at the forum state, such as designing the product for the forum market, advertising there, or establishing channels for providing advice to customers there. Justice Brennan's concurrence, joined by three others, argued that placing goods into the stream of commerce with awareness that they would reach the forum is sufficient for minimum contacts. All eight participating Justices agreed, however, that exercising jurisdiction over Asahi would be unreasonable given the heavy burden on a foreign defendant, the slight interest of the forum state (the original plaintiff had settled), and the international implications.

Asahi created an enduring circuit split on the stream of commerce theory that persisted for decades. Lower courts divided between O'Connor's 'stream of commerce plus' approach and Brennan's pure stream of commerce test. The case also reinforced that the reasonableness prong of the jurisdictional analysis can independently defeat jurisdiction even where minimum contacts arguably exist. The Court partially addressed this split in J. McIntyre Machinery v. Nicastro (2011), though that case also produced a fractured opinion.