Asahi Metal Industry Company, Ltd. v. Superior Court

Supreme Court of California · 1985 · Civil Procedure

702 P.2d 543 (1985)

Updated July 29, 2026

Civil ProcedurePersonal JurisdictionStream of CommerceMinimum Contactspurposeful availmentcomponent partsspecific jurisdictionfair play and substantial justice

Facts

A California motorcycle accident allegedly caused by a defective tire tube killed one California resident and seriously injured another on a California highway. Cheng Shin, the Taiwanese manufacturer of the tube, filed a cross-complaint against Asahi, a Japanese manufacturer of the tube's valve assembly. Asahi had no offices, property, agents, direct sales, or solicitation in California, but for 10 years it sold large quantities of valve assemblies to Cheng Shin, knew Cheng Shin sold tubes in California, and Asahi components were incorporated into tubes sold in California by Cheng Shin and other manufacturers. Between 1978 and 1982, Asahi sold 1,350,000 valve assemblies to Cheng Shin, and Cheng Shin made 20 percent of its United States sales in California.

Issue

May California constitutionally exercise personal jurisdiction over a foreign component-part manufacturer that made no direct sales in California but knowingly sold components for incorporation into finished products sold in California? If minimum contacts exist, is jurisdiction over Asahi in this indemnity action fair and reasonable?

Rule

A state may exercise specific personal jurisdiction over a manufacturer that delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum state. For a component-part manufacturer, the purposeful-availment requirement is satisfied when it intentionally sells components to another manufacturer knowing the components will be incorporated into finished products sold in the forum; if minimum contacts exist, the court must also determine whether jurisdiction is fair and reasonable by balancing the inconvenience to the defendant against the plaintiff's interest in suing locally and the forum state's interest in assuming jurisdiction.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Hoshi Fasteners, a South Korean company, sells millions of brake pins to Alpine Wheel Works in Thailand over eight years. Hoshi has no office, property, agents, or direct sales in Oregon, but it knows Alpine sells completed bicycles nationwide and that substantial numbers are sold in Oregon; an Oregon rider is injured in Portland when a brake pin allegedly fails.

May Oregon most likely exercise specific personal jurisdiction over Hoshi in the rider's products-liability action?

Explanation. The majority held that a component-part manufacturer purposefully avails itself of the forum when it intentionally sells components to another manufacturer knowing the parts will be incorporated into finished products sold in the forum. Direct sales or offices are unnecessary if the defendant's indirect business in the forum is substantial, and specific jurisdiction is proper when the injury arises from those forum-related sales.