{ "id": 11915706, "name": "CARSWELL DISTRIBUTING COMPANY, Plaintiff v. U.S.A.'s WILD THING, INC., and CALIFORNIA INFLATABLES COMPANY, INC., Defendants", "name_abbreviation": "Carswell Distributing Co. v. U.S.A.'s Wild Thing, Inc.", "decision_date": "1996-03-19", "docket_number": "No. COA 95-66", "first_page": "105", "last_page": "109", "citations": [ { "type": "official", "cite": "122 N.C. App. 105" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "28 ALR4th 664", "category": "reporters:specialty", "reporter": "A.L.R. 4th", "opinion_index": -1 }, { "cite": "23 ALR3d 551", "category": "reporters:specialty", "reporter": "A.L.R. 3d", "opinion_index": -1 }, { "cite": "20 ALR3d 1201", "category": "reporters:specialty", "reporter": "A.L.R. 3d", "opinion_index": -1 }, { "cite": "508 A.2d 1127", "category": "reporters:state_regional", "reporter": "A.2d", "year": 1986, "pin_cites": [ { "page": "1139" } ], "opinion_index": 0 }, { "cite": "576 F. Supp. 312", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 6048134 ], "year": 1983, "pin_cites": [ { "page": "321" } ], "opinion_index": 0, "case_paths": [ "/f-supp/576/0312-01" ] }, { "cite": "121 L. Ed. 2d 42", "category": "reporters:federal", "reporter": "L. Ed. 2d", "year": 1992, "opinion_index": 0 }, { "cite": "506 U.S. 824", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 11931744, 11931779, 11931523, 11931493, 11931464, 11931660, 11931436, 11931550, 11931700, 11931574, 11931614 ], "year": 1992, "opinion_index": 0, "case_paths": [ "/us/506/0824-10", "/us/506/0824-11", "/us/506/0824-04", "/us/506/0824-03", "/us/506/0824-02", "/us/506/0824-08", "/us/506/0824-01", "/us/506/0824-05", "/us/506/0824-09", "/us/506/0824-06", "/us/506/0824-07" ] }, { "cite": "414 S.E.2d 752", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1992, "opinion_index": 0 }, { "cite": "331 N.C. 116", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2497986, 2500452, 2499301, 2496909, 2498525 ], "year": 1992, "opinion_index": 0, "case_paths": [ "/nc/331/0116-04", "/nc/331/0116-02", "/nc/331/0116-05", "/nc/331/0116-03", "/nc/331/0116-01" ] }, { "cite": "411 S.E.2d 640", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1992, "pin_cites": [ { "page": "644" } ], "opinion_index": 0 }, { "cite": "105 N.C. App. 52", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521123 ], "year": 1992, "pin_cites": [ { "page": "57" } ], "opinion_index": 0, "case_paths": [ "/nc-app/105/0052-01" ] }, { "cite": "480 U.S. 102", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 1131449 ], "weight": 2, "year": 1987, "opinion_index": 0, "case_paths": [ "/us/480/0102-01" ] }, { "cite": "401 S.E.2d 801", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1991, "pin_cites": [ { "page": "805", "parenthetical": "holding a corporation subject to the jurisdiction of our courts when it has \"purposefully injected\" a product into \"the stream of commerce\" without limiting the area of distribution \"so as to exclude North Carolina\"" }, { "page": "805" } ], "opinion_index": 0 }, { "cite": "102 N.C. App. 222", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8523084 ], "weight": 2, "year": 1991, "pin_cites": [ { "page": "228-29", "parenthetical": "holding a corporation subject to the jurisdiction of our courts when it has \"purposefully injected\" a product into \"the stream of commerce\" without limiting the area of distribution \"so as to exclude North Carolina\"" }, { "page": "229" } ], "opinion_index": 0, "case_paths": [ "/nc-app/102/0222-01" ] }, { "cite": "357 U.S. 235", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6162253 ], "weight": 2, "year": 1958, "pin_cites": [ { "page": "253" }, { "page": "1298" } ], "opinion_index": 0, "case_paths": [ "/us/357/0235-01" ] }, { "cite": "444 U.S. 286", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 11306135 ], "weight": 4, "year": 1980, "pin_cites": [ { "page": "297" }, { "page": "501" }, { "page": "298" }, { "page": "502" } ], "opinion_index": 0, "case_paths": [ "/us/444/0286-01" ] }, { "cite": "471 U.S. 462", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6205101 ], "weight": 7, "year": 1985, "pin_cites": [ { "page": "474", "parenthetical": "quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 62 L. Ed. 2d 490, 501 (1980)" }, { "page": "542", "parenthetical": "quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 62 L. Ed. 2d 490, 501 (1980)" }, { "page": "542" }, { "page": "477" }, { "page": "544" }, { "page": "478" }, { "page": "544", "parenthetical": "listing such disadvantage as illustrative of an unfair exercise of jurisdiction" } ], "opinion_index": 0, "case_paths": [ "/us/471/0462-01" ] }, { "cite": "311 U.S. 457", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6141572 ], "weight": 2, "year": 1940, "pin_cites": [ { "page": "463" }, { "page": "283" } ], "opinion_index": 0, "case_paths": [ "/us/311/0457-01" ] }, { "cite": "326 U.S. 310", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6157001 ], "weight": 2, "year": 1945, "pin_cites": [ { "page": "316", "parenthetical": "quoting Milliken v. Meyer, 311 U.S. 457, 463, 85 L. Ed. 278, 283 (1940)" }, { "page": "102", "parenthetical": "quoting Milliken v. Meyer, 311 U.S. 457, 463, 85 L. Ed. 278, 283 (1940)" } ], "opinion_index": 0, "case_paths": [ "/us/326/0310-01" ] } ], "analysis": { "cardinality": 556, "char_count": 10018, "ocr_confidence": 0.76, "pagerank": { "raw": 5.350729799585044e-08, "percentile": 0.33630377678389745 }, "sha256": "12d3dcd8300d00020467e8f0869232818e955a0c5d5195fdce3db8f81530a1ce", "simhash": "1:978baf9c04de7041", "word_count": 1571 }, "last_updated": "2023-07-14T15:39:52.508825+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judge WALKER concurs.", "Judge MARTIN, MARK D., concurs in the result." ], "parties": [ "CARSWELL DISTRIBUTING COMPANY, Plaintiff v. U.S.A.\u2019s WILD THING, INC., and CALIFORNIA INFLATABLES COMPANY, INC., Defendants" ], "opinions": [ { "text": "LEWIS, Judge.\nThe sole issue in this appeal is whether the exercise of personal jurisdiction by a North Carolina court over defendant California Inflatables Company, Inc. (\u201cCICO\u201d) violates due process. Defendant U.S.A.\u2019s Wild Thing, Inc. is not a party to this appeal.\nOn 22 June 1994 plaintiff filed a complaint against defendants asserting various claims arising from the manufacture of \u201cWild Thing\u201d inflatable boats by defendants and subsequent distribution to plaintiff. On 12 September 1994 CICO moved to dismiss the complaint on the ground that the court lacked personal jurisdiction over CICO. By order entered 1 November 1994, the court granted CICO\u2019s motion to dismiss on the ground that its exercise of personal jurisdiction over CICO would violate due process. Plaintiff appeals this order.\nIn its complaint, plaintiff alleges the following, in pertinent part:\nDefendants, California corporations, formed a joint venture to manufacture, sell, and distribute Wild Thing boats throughout the United States. Plaintiff entered into a verbal agreement with defendants in which plaintiff agreed to distribute boats in North Carolina and parts of the Southeast United States. Forty-two (42) boats were ordered by and shipped to plaintiff in North Carolina. Plaintiff then discovered that the boats were defective.\nAffidavits and exhibits offered by CICO show the following:\nCICO is a California corporation with no offices, facilities, distributors, sales agents, or employe\u00e9s in North Carolina and has never conducted business in this state. CICO has no property, no bank accounts, and no contracts in North Carolina, nor with any resident, including plaintiff.\nNorth America\u2019s Wild Thing, Inc., (\u201cNAWT\u201d) serves as the distributor of boats throughout the United States, Canada, and Mexico for Serious Boat Marketing PTY Limited (\u201cSerious Boat\u201d). On 25 February 1993 CICO and NAWT entered into a manufacturing agreement in which CICO agreed to manufacture inflatable boats for distribution by NAWT pursuant to NAWT\u2019s agreements with Serious Boat. In 1993 CICO began making boats under this agreement and directly shipped forty-two (42) boats, at NAWT\u2019s direction, to plaintiff in North Carolina. Under the terms of the manufacturing agreement, CICO billed NAWT, not plaintiff, for the boats sent to plaintiff.\nA court\u2019s exercise of personal jurisdiction over an out-of-state defendant comports with due process under the Fourteenth Amendment of the United States Constitution if the defendant has \u201ccertain minimum contacts\u201d with the forum state so that \u201cmaintenance of the suit does not offend \u2018traditional notions of fair play and substantial justice.\u2019 \u201d International Shoe Co. v. Washington, 326 U.S. 310, 316, 90 L. Ed. 95, 102 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 85 L. Ed. 278, 283 (1940)).\nFor a showing of minimum contacts, a defendant\u2019s \u201c \u2018conduct and connection with the forum State\u2019 \u201d must be \u201c \u2018such that he should reasonably anticipate being haled into court there.\u2019 \u201d Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474, 85 L. Ed. 2d 528, 542 (1985) (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 62 L. Ed. 2d 490, 501 (1980)). To establish such conduct and connection there must be \u201c \u2018some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.\u2019 \u201d Id. at 474-75, 85 L. Ed. 2d at 542 (quoting Hanson v. Denckla, 357 U.S. 235, 253, 2 L. Ed. 2d 1283, 1298 (1958)).\nMinimum contacts can be found when the out-of-state defendant injects products into the \u201cstream of commerce\u201d with the expectation that the products will reach the forum state. World-Wide Volkswagen Corp., 444 U.S. at 298, 62 L. Ed. 2d at 502. North Carolina courts have applied stream of commerce analysis to support the exercise of personal jurisdiction in defective product cases. E.g., Warzynski v. Empire Comfort Systems, 102 N.C. App. 222, 228-29, 401 S.E.2d 801, 805 (1991) (holding a corporation subject to the jurisdiction of our courts when it has \u201cpurposefully injected\u201d a product into \u201cthe stream of commerce\u201d without limiting the area of distribution \u201cso as to exclude North Carolina\u201d). North Carolina cases that use stream of commerce analysis have not been overruled by the United States Supreme Court\u2019s decision in Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102, 94 L. Ed. 2d 92 (1987). Cox v. Hozelock, Ltd., 105 N.C. App. 52, 57, 411 S.E.2d 640, 644, disc. review denied, 331 N.C. 116, 414 S.E.2d 752, cert. denied, 506 U.S. 824, 121 L. Ed. 2d 42 (1992); Warzynski, 102 N.C. App. at 229, 401 S.E.2d at 805.\nHere, CICO entered into a manufacturing agreement with NAWT, a company that served as the distributor for Serious Boat throughout the United States, Mexico, and Canada. In the manufacturing agreement, NAWT appointed CICO as its \u201cexclusive manufacturer\u201d with a commitment from CICO to \u201cmass manufacture\u201d a \u201csubstantial quantity\u201d of boats for distribution by NAWT. The agreement also provided that CICO would ship the boats to various destinations designated by NAWT. By shipping the boats to plaintiff in North Carolina pursuant to this agreement CICO intentionally injected its boats into the stream of commerce and purposefully availed itself of the benefit of North Carolina markets. Given the wide distribution of boats contemplated by its agreement with NAWT and its direct shipment to North Carolina under this agreement, CICO could reasonably expect to be sued in North Carolina in a defective product action.\nThe fact that this is a suit for economic injury rather than personal injury does not preclude application of stream of commerce analysis here. When confronted with this issue, courts in other states have noted that states have an interest in protecting their residents from economic injury, as well as from personal injury. E.g., Copiers Typewriters Calculators, Inc. v. Toshiba Corp., 576 F. Supp. 312, 321 (D.Md. 1983); Charles Gendler & Co., Inc. v. Telecom Equipment Corp., 508 A.2d 1127, 1139 (N.J. 1986). Due process does not require North Carolina courts to wait for personal injury to occur before exercising jurisdiction in defective product actions against out-of-state defendants. Must someone die before justice will lie?\nNeither does it offend \u201ctraditional notions of fair play and substantial justice,\u201d for our courts to exercise jurisdiction here. A defendant who has \u201cpurposefully directed his activities\u201d at residents of the forum state \u201cmust present a compelling case\u201d to show that \u201cother considerations\u201d would make the exercise of jurisdiction by the forum state \u201cunreasonable.\u201d Burger King Corp., 471 U.S. at 477, 85 L. Ed. 2d at 544. CICO has not done so here.\nCICO asserts that the costs and inconvenience of litigation in North Carolina would be an unfair and extreme burden. We note, however, that a similar burden would be borne by plaintiff if required to litigate in California. The record does not show that CICO would be \u201cseverely disadvantaged\u201d by litigation in North Carolina. See Burger King Corp., 471 U.S. at 478, 85 L. Ed. 2d at 544 (listing such disadvantage as illustrative of an unfair exercise of jurisdiction). Further, it is not unfair play, to require CICO to defend here given its intentional decision to avail itself of the benefits of markets in North Carolina. North Carolina\u2019s interest in protecting its residents from harm caused by defective products outweighs any inconvenience to CICO.\nThe exercise of personal jurisdiction over CICO by a North Carolina court in this action does not violate due process.\nReversed and remanded.\nJudge WALKER concurs.\nJudge MARTIN, MARK D., concurs in the result.", "type": "majority", "author": "LEWIS, Judge." } ], "attorneys": [ "Womble Carlyle Sandridge & Rice, a Professional Limited Liability Company, by W. Andrew Copenhaver and Timothy A. Thelen, for plaintiff-appellant.", "Bell, Davis & Pitt, P.A., by William K. Davis and Stephen M. Russell, for defendant-appellee California Inflatables Company, Inc." ], "corrections": "", "head_matter": "CARSWELL DISTRIBUTING COMPANY, Plaintiff v. U.S.A.\u2019s WILD THING, INC., and CALIFORNIA INFLATABLES COMPANY, INC., Defendants\nNo. COA 95-66\n(Filed 19 March 1996)\nCourts \u00a7 16 (NCI4th)\u2014 California manufacturer \u2014 injection of boats into stream of commerce \u2014 exercise of personal jurisdiction over manufacturer proper\nThe exercise of personal jurisdiction over a California manufacturer did not violate due process, though the manufacturer had no offices, facilities, sales agents, or employees in North Carolina and had never conducted business in this state, since the manufacturer entered into an agreement with a distributor to ship boats to plaintiff in North Carolina; pursuant to this agreement defendant manufacturer intentionally injected its boats into the stream of commerce and purposely availed itself of the benefit of North Carolina markets; given the wide distribution of boats contemplated by defendant, it could reasonably expect to be sued in this state in a defective product action; and the fact that this was a suit for economic injury rather than personal injury did not preclude application of the stream of commerce analysis.\nAm Jur 2d, Courts \u00a7\u00a7 80, 106, 107.\nValidity, as a matter of due process, of state statutes or rules of court conferring in personam jurisdiction over nonresidents or foreign corporations on the basis of isolated business transaction within state. 20 ALR3d 1201.\nConstruction and application of state statutes or rules of court predicating in personam jurisdiction over nonresidents or foreign corporations on making or performing a contract within the state. 23 ALR3d 551.\nExecution, outside of forum, of guaranty of obligations under contract to be performed within forum state as conferring jurisdiction over non-resident guarantors under \u201clong-arm\u201d statute or rule of forum. 28 ALR4th 664.\nAppeal by plaintiff from order entered 1 November 1994 by Judge Howard R. Greeson, Jr. in Forsyth County Superior Court. Heard in the Court of Appeals 20 October 1995.\nWomble Carlyle Sandridge & Rice, a Professional Limited Liability Company, by W. Andrew Copenhaver and Timothy A. Thelen, for plaintiff-appellant.\nBell, Davis & Pitt, P.A., by William K. Davis and Stephen M. Russell, for defendant-appellee California Inflatables Company, Inc." }, "file_name": "0105-01", "first_page_order": 141, "last_page_order": 145 }