AFJ is counting down the 10 worst decisions of the Corporate Court's 2010-11 term. Yesterday, at #9, we talked about Sorrell v. IMS Health, which gives corporations a First Amendment right to use private medical information to market expensive drugs.
Worst Decisions of the 2010-11 Corporate Court Term: #8 J. McIntyre Machinery v. Nicastro
Protecting Foreign Corporations from Accountability When Their Products Cause Harm
The Corporate Court ruled 6-3 in this case against Robert Nicastro, a man who lost four fingers when his hand was caught in an industrial cutting machine he used at his job in New Jersey. Nicastro claimed that the machine was missing an important safety guard that could have prevented the injury. The Court ruled that a New Jersey state court could not even hear Nicastro’s negligence claim against J. McIntyre Machinery, the machine’s England-based manufacturer. The majority held that the state court lacked jurisdiction over the company because J. McIntyre had not engaged in conduct that was purposely directed at the New Jersey market.
J. McIntyre had an exclusive American distributor that it hoped would sell to every region of the United States. Nicastro’s employer purchased the machine that injured him at a trade show in Las Vegas.
Justice Ginsburg’s dissent argued that J. McIntyre should not be granted a free pass to avoid liability in every state court in the United States merely because it directed its distributor to attract customers “from anywhere in the United States.” J. McIntyre UK’s president described the company’s strategy in the following way: “All we wish to do is sell our products in the [United] States—and get paid!” Ginsburg argued that “[t]he machine arrived in Nicastro’s New Jersey not randomly or fortuitously, but as a result of the U.S. connections and distribution system that McIntyre UK deliberately arranged.” The dissent contrasted what Nicastro was asking of J. McIntyre with what the majority was now requiring of Nicastro.
On what measure of reason and fairness can it be considered undue to require McIntyre UK to defend in New Jersey as an incident of its efforts to develop a market for its industrial machines anywhere and everywhere in the United States? Is not the burden on McIntyre UK to defend in New Jersey fair, i.e., a reasonable cost of transacting business internationally, in comparison to the burden on Nicastro to go to Nottingham, England to gain recompense for an injury he sustained using McIntyre’s product at his workplace in Saddle Brook, New Jersey?J. McIntyre Machinery v. Nicastro is number eight on AFJ’s Worst Decisions of the Corporate Court Term because the Court ensured that many individuals who are harmed by defective products made by foreign manufacturers will be denied access to justice even when the manufacturers are intentionally profiting from U.S. consumers.
