Judge: Christian R. Gullon, Case: 24PSCV00308, Date: 2025-02-26 Tentative Ruling

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Case Number: 24PSCV00308    Hearing Date: February 26, 2025    Dept: O

Tentative Ruling

MOTION OF SPECIALLY APPEARING CROSS-DEFENDANT POWERMAX ELECTRIC COMPANY, LTD. GUANGDONG, TO QUASH SERVICE OF SUMMONS OF, AIR VENT, INC.’S CROSS-COMPLAINT BASED UPON LACK OF PERSONAL JURISDICTION is GRANTED; While AVI, a Texas corporation, may have demonstrated that Powermax has availed itself of the United States, it has not shown that Powermax has purposefully designed its motor or targeted its products to California. Based on the foregoing, the motion is granted. What is more, Bridgestone, infra, has been SUPERSEDED by J.McIntyre; therefore, any reliance upon Bridgestone is unavailing.

Background

This is a negligence case. Plaintiff Interinsurance Exchange of the Automobile Club as Subrogee of George and Martha Lodahl alleges the following against Defendant Air Vent, Inc. (“AVI”) and King of Fans, Inc. (“KOF”): In June 2021, a 6-blade Air Vent, Inc. attic ventilation fan (hereinafter, “product” or “fan”) failed within the motor windings of the fan at the insured’s home causing an extensive fire (and losses of about $400,000). Plaintiff alleges that Defendants were engaged in the business of designing, manufacturing, assembling, inspecting, testing, distributing, marketing, advertising, promoting, selling and placing into the stream of commerce the product.

On January 30, 2024, Plaintiff filed suit asserting the following causes of action (COAs):

1. General Negligence and
2. Products Liability

On March 7, 2024, AVI filed its answer and, that same day, filed a cross-complaint (CC) against POWERMAX ELECTRIC CO., LIMITED, GUANGDONG (“Powermax” or “Defendant”)^[1] and KOF for the following COAs:

1. Strict Products Liability
2. Negligence
3. Breach Of Written Contract
4. Breach Of Express Warranties
5. Breach Of Implied Warranties
6. Implied Contractual Indemnity
7. Equitable Indemnity
8. Express Contractual Indemnity
9. Contribution
10. Declaratory Relief Re: Duty To Defend
11. Declaratory Relief Re: Duty To Indemnify
12. Declaratory Relief Re: Contractual Duties

On April 15, 2024, KOF filed its answer to the complaint.

On July 3, 2024, KOF filed its answer to AVI’s CC.

On December 31, 2024, Powermax filed the instant motion.

On February 11, 2025, AVI filed its opposition.

On February 19, 2025, Powermax filed its reply.

Discussion

As a prefatory matter, before engaging in the merits of the motion, there are two important matters the court needs to address.

First, AVI does not inform the court of where it is incorporated; the court only learns in Powermax’s Reply that AVI is a company incorporated in TEXAS. (Reply p. 3:8-9.) Accordingly, as noted by Powermax, even if Powermax did transact directly with AVI, that would not create personal jurisdiction in California.^[2] The same applies to AVI’s heavy reliance upon any agreements between Powermax and Lowe’s, Home Depot, and Walmart. AVI does not indicate what state those companies are incorporated in, but they are not incorporated in California. Lowe’s is a North Carolina company and Walmart is an Arkansas company. (Reply p. 4.) Therefore, any purported agreements between those companies would not create personal jurisdiction in California.

Second, AVI requests the court to take judicial notice (RJN) of two cases: (1) The Court's Order denying Powermax's Motion to Dismiss in a similar matter entitled Fire Insurance Exchange (Dunham) v. Powermax Electric Co., LTD, et al., Nevada County Superior Court Case No. CU19-083425^[3] and (2) The Notice of Ruling on Powermax's Motion to Quash filed by Powermax in a similar matter entitled State Farm General Insurance (Sapp/Burrows) v. Air Vent, Inc., et al., San Bernardino County Superior Court Case No. CIVSB2111551.^[4] The court DENIES the RJN.^[5]

According to Evidence Code section 452(d) says court may take judicial of "records of any court of this state" and section 453 says the court shall take RJN of any matter in 452 if the party requesting (i) gives notice and (ii) gives court info why it should take judicial notice.

Here, “[A] written trial court ruling has no precedential value” (Bolanos v. Superior Court (2008) 169 Cal.App.4^th 744, 761; Drummond v. Desmarais (2009) 176 Cal.App.4^th 439, 448, fn. 4 [“(I)n the absence of some additional showing—such as the conditions for claim or issue preclusion—the actions of other judges are simply irrelevant”].) Despite that, AVI (essentially) argues that the other courts’ orders are binding upon this court. (Opp. p. 5:25-26 [“Even if this court evaluates Powermax’s motion anew….”], italics original.)

Therefore, as this court is to evaluate Powermax’s motion anew and those cases do not have precedential value, the RJN is denied.

1. Overview of the Case

-The matter arises out of a fire that was started by an attic exhaust fan. Plaintiff alleges that AVI manufactured the fan and placed it into the stream of commerce; AVI alleges that Powermax manufactured the motor in the fan and placed that motor into the stream of commerce.

- AVI manufactures and sells several products, including powered attic ventilation products. (Opp. p. 6, citing Holland Decl., ¶2.)^[6] “Some of AVI’s powered attic ventilation products include ventilation fans powered by electric motors. All electric-powered attic ventilation fans sold by AVI include fan motors designed and manufactured by third parties. All third-party motor manufacturers design, manufacture and sell their motors to AVI and other Fan manufacturers. All fan motors included in AVI fans are purchased by AVI from third parties as completely assembled, ready-to-install units.” (Holland Decl., ¶2.)

- All Powermax fan motors were designed, manufactured, marketed and sold by Powermax. (Holland Decl., ¶3.)^[7]

- From 2003 to 2012, AVI purchased approximately 2,879,733 electric motors from Powermax. (Holland Decl., ¶.)

-Some of the sales of Powermax motors to AVI were arranged through DM (ASIA), LTD (hereinafter “DMA”). (Holland Decl., ¶4.) DMA is not a manufacturer and  has no manufacturing facility. (Holland Decl., ¶5.) All fan motors manufactured by Powermax for AVI were purchased in bulk through the issuance of purchase orders to DMA. (Holland Decl., ¶5.) These fans/orders were then sent from the factory in China using ports in California, Florida, Virginia, and Texas for final delivery to AVI. (Holland Decl., ¶¶5, 8.)

2. Problems with AVI’s Evidence^[8]

When a nonresident defendant challenges personal jurisdiction, the burden is on “the plaintiff to demonstrate, by a preponderance of the evidence, that all necessary jurisdictional criteria have been met.” (Motion p. 10, citing Paneno v. Centres for Academic Programmes Abroad Ltd. (2004) 118 Cal.App.4th 1447, 1454.) This burden can only be satisfied with “the presentation of competent evidence in affidavits or declarations and AUTHENTICATED documentary evidence. [internal citation omitted]. Affidavits or declarations consisting primarily of VAGUE ASSERTIONS of ultimate fact rather than specific evidentiary facts are not sufficient.” (Ibid, capitalization added; see also Reply p. 2, citing In re Automobile Antitrust Cases I & II (2005) 135 Cal.App.4th 100, 110; Ziller Elec. Lab GmhbH v. Superior Court (1988) 206 Cal.App.3d 1222, 1233.) In examining this evidence,  any conflicts between the facts contained in the parties’ affidavits must be resolved in the plaintiff/non-moving party’s favor. (Opp. p. 9, citing American Tel. & Tel. Co. v. Compagnie Bruxelles Lambert, 94 F.3d 586, 588 (9th Cir. 1996.) Once the plaintiff has met the burden of demonstrating facts justifying the exercise of jurisdiction, the burden shifts to the defendant to demonstrate that the exercise of jurisdiction would be unreasonable. (Paneno, supra, 118 Cal.App.4th at p. 1454.)

Here, the court agrees with Powermax that AVI fails to offer “competent evidence containing specific evidentiary facts [] and merely offers generic contentions and conclusions….” (Reply p. 8:11-13.) 

First, a substantial portion of the evidence is not authenticated. See e.g.,:

-        (Reply p. 2 [Exhibit 2 unauthenticated document that Mr. Holland lacks foundation to verify, at most shows that Powermax manufactured items for DMA, not AVI].)

-        AVI Counsel Darlene Hernandez’s Exhibit 7, which purports to show Powermax’s sales network in graphical form, fails to identify how or when she encountered the website and otherwise fails to support the authenticity of this exhibit.

-        Exhibit 8 attached to Counsel Hernandez’s declaration, which purports to show the sale of Powermax products on Amazon and Walmart, is unauthenticated and provide no verifiable links; the print-outs omit information about the actual seller. This is deficient especially as Amazon is “rife with counterfeit and unauthorized listings.” (Reply p. 4:3-4.)

Second, AVI contends that some of the sales of Powermax motors to AVI were arranged through Powermax’s agent/marketing agent, DMA. (Holland Decl., ¶¶4, 5.) As to Cross-Defendant KOF (which is a Florida corporation; See CC ¶3; Holland Decl., ¶14), AVI contends that it “is an entity that owns or controls Powermax, has shared ownership with Powermax, and is also in a joint venture with Powermax to distribute manufactured products throughout the United States, including the [] California.” (Holland Decl., ¶14.) Aside from conclusions, AVI has provided no analysis or stringed together evidence with an analysis to demonstrate the existence of an agency relationship between Powermax and DMA and/or a joint venture between Powermax and KOF. To the extent that AVI is relying upon the (unauthenticated) Supplier Buying Agreement between KOF (supplier) and Home Depot wherein KOF states that the “[r]elationship between the supplier and factory” is one of a “Joint Venture” (See Hernandez Decl., Ex. 10, p. 64 of 176 of PDF, KOF is a FLORIDA corporation such that a joint venture would still not establish California’s jurisdiction over Powermax.

Third, AVI has the evidentiary burden to prove both that Powermax shipped products to California and shipped the products at issue to California. (Reply p. 6.) AVI relies upon the Declaration of Nickie Bonefant, the Chief Operating Officer for ImportGenius, which is a company that provides access to shipping databases from Customs agencies in the United States. However, nothing in the Declaration shows that the subject motors in this case were shipped to California by Powermax. (See Bonefant Decl., Ex. 8, p. 22 of 24 of PDF.)^[9]

3. Overview of Personal Jx

Personal jurisdiction refers to a court’s authority to adjudicate the rights and liabilities of a defendant. The doctrine arises from the US Constitution’s Due Process Clause of the Fourteenth Amendment which limits the power of a state court to assert personal jurisdiction (i.e., power) over a nonresident defendant. (Asahi Metal Indus. Co. v. Superior Court (1987) 480 U.S. 102, 113.) Under California’s long-arm statute, California state courts may exercise personal jurisdiction “on any basis not inconsistent with the Constitution of this state or of the United States.” (Civ. Proc. Section 410.10.) Personal jurisdiction may be either general or specific. (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 446.) (General jurisdiction is referred to as “all-purpose jurisdiction” and specific jurisdiction is referred to as “conduct-linked jurisdiction.” See Goodyear Dunlop Tires Operations, S.A. v. Brown 564 U.S. 91, 919 (2011).)

At issue here are both general and specific jurisdiction, though the crux of both the motion opposition are dedicated to specific jurisdiction.

I.    General Jurisdiction

The “paradigm” places where a corporation can be “fairly regarded” as at home are its place of incorporation and its principal place of business. (Goodyear, supra, 564 U.S. at p. 924.) Here, Powermax is a non-resident company organized and existing under the People’s Republic of China. (Motion p. 7, citing Tsui Decl., ¶5.)^[10] Powermax maintains its principal place of business at 1-2 Region, South of Qibao Industries, Xinhui District, Jiangmen City, Guangdong, China 529100. Based thereon, AVI does not dispute that Powermax is neither incorporated in California nor has its principal place of business in California. Absent service in California, absent consent to appear in the action, and absent domicile in California, the remaining way for California to establish general jurisdiction over Powermax is if its “affiliations with the State are so ‘continuous and systematic’ as to render [it] essentially at home in the forum State.” (Id., at p. 919; see also see also International Shoe, supra, 326 U.S. at p. 318 [“instances in which the continuous corporate operations within a state [are] so substantial and of such a nature as to justify suit ... on causes of action arising from dealings entirely distinct from those activities” renders all-purpose jurisdiction appropriate.].)

In Daimler AG v. Bauman, the Court clarified the general jurisdiction principles articulated in Goodyear. Justice Ginsburg, in delivering the unanimous opinion of the Court, suggested that there might be “exceptional case[s]” in which a corporation’s operations in a forum other than its place of incorporation and principal place of business are “so substantial and of such a nature as to render the corporation at home in that State.” (Daimler, supra, 571 U.S. at 139, n.19.) Put another way, general jurisdiction is proper when “a defendant's contacts with the forum are so wide-ranging that they take the place of physical presence in the forum as a basis for jurisdiction.” (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 445-446, emphasis added.) “To test that possibility, courts look to a variety of factors, including maintenance of offices, the presence of employees, use of bank accounts and marketing or selling products in the forum state, to analyze whether a corporation's contacts render it effectively at home in that state.” (Op. p. 10, citing Brue v. Shabaab (2020) 54 Cal.App.5th 578, 590-591.)

To illustrate what constitutes contacts that are so ‘continuous and systematic’ as to render the defendant essentially at home in the forum State (or not at home), the court turns to some of the most seminal cases on the matter. As the cases below will demonstrate, establishing general jurisdiction in the non-paradigm places is extremely difficult.(See e.g., Monkton Ins. Services, Ltd. V. Ritter, 768 F.3d 429, 432 (5th Cir. 2014) [State and federal courts throughout the country have similarly recognized that it is “incredibly difficult to establish general jurisdiction in a forum other than the place of incorporation or the principal place of business.”]; see also Brown v. Lockheed Martin Corp., 814 F.3d 619, 627 (2d Cir. 2016) [explaining that plaintiff “bears a heavy burden when she asserts that [defendant’s] presence in Connecticut presents such an ‘exceptional’ case”]; see Cahen v. Toyota Motor Corp., 147 F.Supp.3d 955, 965 (N.D. Cal. 2015) [commenting that the “bar . . . is very high” to find that a forum state can exercise general jurisdiction over a nonresident defendant.

Perkins

In Perkins v. Benguet Consol. Mining Co., 342 U.S. 437 (1952), war had forced the defendant corporation's (Philippines mining corporation) owner to temporarily relocate the enterprise from the Philippines to Ohio. (Id. at pp. 447-448.) Although the claim-in-suit did not arise in Ohio, the Perkins determined Ohio’s exercise of general jurisdiction was permissible because the corporation's president maintained his office in Ohio, kept the company files in that Ohio office, and supervised from the Ohio office such that Ohio became the “center of the corporation’s wartime activities.” (Daimler, supra, 571 U.S. at p. 130, n. 8.) Thus, in summary, general jurisdiction is proper when the defendant corporation’s activities are directed from the forum state. (Ibid.)

Helicopteros

To the contrary, “mere purchases, even if occurring at regular intervals are not enough to warrant a State's assertion of in personam jurisdiction over a nonresident corporation in a cause of action not related to those purchase transactions.” (Id. at p. 131, citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (1984) [in a case arising from a helicopter crash in Peru, the Court determined that Texas could not exercise personal jurisdiction over the Colombian corporation even though the company had contacts with Texas (e.g., accept checks drawn from a Houston bank; purchasing helicopters, equipment, and training services from a Texas-based helicopter company for substantial sums; and sending personnel and chief effective officer to Houston].)  Thus, in summary, a case is not exceptional merely because it makes purchases from the forum state.

Goodyear

In further sharpening the extent of general jurisdiction, the Court in Goodyear—a case that arose from a bus accident outside Paris that killed two boys from North Carolina—determined that North Carolina lacked general jurisdiction over the foreign subsidiaries of Goodyear Tire and Rubber Company even though “[a] small percentage of tires manufactured by the foreign subsidiaries distributed in North Carolina.” (Daimler, supra, 571 U.S. at p. 131-132, citing Goodyear, supra.) Thus, in summary, a case is not exceptional merely because of the distribution (sales and purchase) of an item in the forum state.

Daimler

In Daimler, the complaint alleged that during Argentina's 1976–1983 “Dirty War,” DaimlerChrysler Aktiengesellschaft’s (Daimler) Argentinian subsidiary, Mercedes-Benz Argentina (MB Argentina) collaborated with state security forces to kidnap, detain, torture, and kill certain MB Argentina workers, among them, plaintiffs or persons closely related to plaintiffs. The plaintiffs sued Daimler in California. The Court held that California could not exercise personal jurisdiction over Daimler, a German public stock company, because the corporation was neither incorporated in California nor have its principal place of business in California. As for the sufficiency of the contacts, Daimler's subsidiary had multiple California-based facilities; was the “largest supplier of luxury vehicles to the California market; 10% of all sales of new vehicles in the United States took place in California; and California sales accounted for 2.4 of Daimler’s worldwide sales. (Daimler, supra, 571 U.S. at p. 123.) Despite those numbers, the Court determined them insufficient to allow adjudication of the Argentina-rooted case in California because “the same global reach would presumably be available in every other State in which [the corporation’s] sales are sizable. No decision of this Court sanctions a view of general jurisdiction so grasping.” (Daimler, supra, 571 U.S. at p. 119, emphasis added.) Thus, in summary, a case is not exceptional merely because its sales in the forum state are sizable or because of the “magnitude of the defendant’s in-state contacts.” (Id. at p. 139, fn. 20.)

BNSF

The Supreme Court underscored the notion that a nonresident corporation conducts in-state business is insufficient to maintain general jurisdiction^[11] in BNSF Ry. Co. v. Tyrrell (2017) 581 U.S. 402. In BNSF, the plaintiffs sued the railroad company for work-related injuries in a Montana state court, even though “[n]either worker was injured in Montana; Neither incorporated nor headquartered there, [the company] maintains less than 5% of its work force and about 6% of its total track mileage in the State.” (Id. at p. 402.)^[12] In emphasizing the canon that in-state business, as clarified in Daimler and Goodyear, does not suffice to permit the assertion of general jurisdiction over claims that are unrelated to any activity occurring in the forum state, the Court observed that “the general jurisdiction inquiry does not focus solely on the magnitude of the defendant's in-state contacts . . . Rather, the inquiry ‘calls for an appraisal of a corporation's activities in their entirety’; ‘[a] corporation that operates in many places can scarcely be deemed at home in all of them.’” (Id. at p. 414; see also Motion p. 14, quoting Bancroft & Masters, Inc. v. Augusta Nat. Inc. (9th Cir. 2000) 22 F.3d 1082, 1086 [“[E]ngaging in commerce with residents of the forum state is not in and of itself the kind of activity that approximates physical presence within the state's borders.”]; see also Motion p. 14, citing Johnston v. Multidata Systems Intern. Corp. (5th Cir.2008) 523 F.3d, 602, 611 [“[I]n order to confer general jurisdiction a defendant must have a business presence in [the forum state]. It is not enough that a corporation do business with [the forum state], italics original].)

Plaintiff advances the following argument: “Powermax sold and marketed its products specifically to customers in California. Moreover, it advertises throughout the United States that its products are available for purchase in California. In doing so, Powermax acknowledged that its business was at home in California all throughout the United States. This was further perpetuated by and through Powermax’s agent, DMA, and the distributors of Powermax’s products including Home Depot, Lowes and Walmart.^[13] Indeed, the accumulation of fires related to its products occurring within California is proof of the success of its directed marketing and distribution in California.” (Opp. pp. 10-11, italics added.)

Here, for one, AVI has not cited to evidence to support those statements. Second, AVI’s contention that Powermax does business “all throughout the United States” but supports the lack of general jurisdiction. The question is not whether a non-resident defendant has a business presence in the U.S but in the forum state.

Therefore, the court determines that California cannot exercise general jurisdiction over Defendant.

2. Specific Jurisdiction

The specific jurisdictional analysis is “intensely fact-specific.” (Rivelli v. Hemm (2021) 67 Cal.App.5th 380, 393, emphasis added.) Both the United States Supreme Court and the California high court have cautioned that the “‘minimum contacts’ test ... is not susceptible of mechanical application; rather, the facts of each case must be weighed to determine whether the requisite ‘affiliating circumstances’ are present.” (Kulko v. California Superior Court (1978) 436 U.S. 84, 92, 98 S.Ct. 1690, 56 L.Ed.2d 132 (Kulko.) “California courts routinely apply a three-part test to determine whether a court may exercise specific jurisdiction over a nonresident defendant: (1) the defendant has purposefully availed himself or herself of forum benefits, (2) the controversy is related to or arises out of the defendant’s purposeful contacts with the forum, and (3) the assertion of personal jurisdiction would comport with fair play and substantial justice. (Pavlovich v. Superior Court (2002) 29 Cal.4th 262; see also Keeton v. Hustler Magazine, Inc. (1984) 465 U.S. 770, 774 (Keeton).) A plaintiff has the initial burden of demonstrating facts to support the first two factors, which establish the requisite minimum contacts with the forum state. The burden then shifts to the defendant to show that the exercise of jurisdiction would be unreasonable under the third factor. (Snowney v. Harrah’s Entertainment, Inc. (2005) 35 Cal.4th 1054, 1062; see also see also Burger King Corp. v. Rudzewicz (1985) 471 U.S. 462, 477 (Burger King) [“where a defendant who purposefully has directed his activities at forum residents seeks to defeat jurisdiction, he must present a compelling case that the presence of some other considerations would render jurisdiction unreasonable.”].)

1. Purposeful Availment

“[P]urposeful availment exists whenever the defendant purposefully and voluntarily directs its activities toward the forum state in an effort to obtain a benefit from that state.” (Snowney, supra, 35 Cal.4th at p. 1067; see also Opp. p. 12, citing Yahoo! Inc. v. La Ligue Cantra Le Racisme Et L’Antisemitism, (9th Cir. 2006) 433 F.3d 119, 1206 [“Despite its label, this prong includes both purposeful availment and purposeful direction. It may be satisfied by purposeful availment of the privilege of doing business in the forum; by purposeful direction of activities at the forum; or by some combination thereof.”].) When a manufacturer makes a direct effort to serve the market for its product in the forum state, the requisite level of foreseeability is met. (World–Wide Volkswagen Corp. v. Woodson, supra, 444 U.S. 286, 297 [100 S.Ct. 559, 567, 62 L.Ed.2d 490, 501].); see also (Asahi Metal Industry Co. v. Superior Court (1987) 480 U.S. 102, 112, 107 S.Ct. 1026, 1032, 94 L.Ed.2d 92 (plur. opn. by O'Connor, J. [For the purpose of deciding whether a defendant has minimum contacts or purposefully has availed itself of forum benefits, the relevant contacts are said to be with the forum, because it is the defendant's choice to take advantage of opportunities that exist in the forum that subjects it to jurisdiction.].) The purposeful availment requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts. (Burger King, supra, 471 U.S. at p. 475.) In sum, the purposeful availment inquiry focuses on the defendant's intentionality. (Pavlovich, supra, 29 Cal.4th at p. 269.) California courts have consistently concluded that a foreign corporation purposefully avails itself of the benefits of the California forum when it knowingly sells and ships its products to California businesses for use in California. (See Jayone Foods, Inc. v. Aekyung Industrial Co. Ltd. (2019) 31 Cal.App.5th 543, 556–557, 242 Cal.Rptr.3d 705 (Jayone Foods) [South Korean company that “engaged in a number of direct sales transactions with multiple California distributors of its consumer products” purposefully availed itself of the benefits of doing business in California]; Luberski, Inc. v. Oleficio F.LLI Amato S.R.L. (2009) 171 Cal.App.4th 409, 419, 89 Cal.Rptr.3d 774 [Italian company that sold olive oil to California businesses and delivered it to California “had the expectation that the goods ... would be utilized in California” and thus “purposefully availed itself of the [California] forum”].)

Here, AVI has not provided evidence that Powermax DESIGNED the motor FOR California nor intended to SERVE a California market. The opposition itself is replete with references to Powermax serving a United States market. “(1) [Powermax] purposefully sells and exports 100% of its products to the United States’ market and others; (2) that it enjoys an important status in the American market, and its fans take more than 10% in the American market; (3) that in 1993 it won major contracts in the United States with companies such as KMART and WALMART…(7) that it sells to the United States through its Sales Network.” (Opp. pp. 13-14, emphasis added.) However, as noted by the breadth of cases above, the question of purposeful availment concerns the authority of a California state court to exercise jurisdiction, so it is Powermax’s purposeful contacts with California, not with the United States, that alone are relevant.

To the extent that AVI attempts to use the fact that in 1985 Powermax obtained American UL standard certification for its ceiling fans and fan motors, that relevance is unclear.

To the extent that AVI attempts to use the arrival of Powermax’s motors to ports as evidence, that too does not comport with the realities of modern-day commerce, namely as there is a significant distinction between products being shipped to California and being shipped through California, a distinction that neither AVI nor ImportGenius address.

California ports of Los Angeles and Long Beach are some of the only major ports on the West Coast of the United States [;] they are often a gateway for shipping rather than an actual destination – that is, goods frequently arrive in California ports on the way to other destinations…Indeed, nothing in the IG Declaration identifies a single instance where a particular shipment was specifically directed at California, as opposed to merely passing through a California port on its way to another destination. (Reply p. 5:11-18.)

To the extent that AVI attempts to distinguish Asahi from the present matter and to instead follow Bridgestone Corp. v. Superior Court (2002) 99 Cal.App.4th 767, that reliance is misplaced. (See Opp. pp. 15-17.)^[14]

When it comes to the stream of commerce, Asahi Metal Indus. Co. v. Super. Ct. of Cal., 480 U.S. 102 (1987) (Asahi) (plurality opinion) and J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873 (2011) (J. McIntyre) (plurality opinion) are particularly instructive, and readily resolve the issue in favor of Powermax.

In 1987, the Court in Asahi issued two fractured plurality opinions. In Asahi, a plaintiff alleged that the car accident was caused by a defective tire, tube, and sealant. (Id. at pp. 105-106.) Asahi, a Japanese corporation, was the manufacturer of the tire valve assemblies and sold the assemblies to Cheng Shin, the Taiwanese manufacturer of the tube and to several other tire manufacturers. (Id. at p. 106.)  The shipments from Asahi to Cheng Shin were sent from Japan to Taiwan and Cheng Shin alleged that approximately 20 percent of its sales in the United States are in California. (Ibid.) On the issue of whether Asahi purposefully directed its activities toward California, the Supreme Court of California determined that Asahi purposefully availed itself of California because it "considered Asahi's intentional act of placing its components into the stream of commerce—that is, by delivering the components to Cheng Shin in Taiwan—coupled with Asahi's awareness that some of the components would eventually find their way into California, sufficient to form the basis for state court jurisdiction...." (Id. at p. 108.) In reversing the state supreme court's decision, Justice O'Connor's plurality observed that something more than that the defendant's mere awareness of its product's entry into the forum State through the stream of commerce is required. (Id. at pp. 111-112.) Specifically, the following was stated in Part II-A of the opinion:

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. ADDITIONAL CONDUCT of the defendant may indicate an intent or purpose to serve the market in the forum State, for example, DESIGNING THE PRODUCT FOR the market in the forum State,^[15] advertising in the forum State, 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. But a defendant's awareness that the stream of commerce may or will sweep the product into the forum State does not convert the mere act of placing the product into the stream into an act purposefully directed toward the forum State. (Id. at p. 112, emphasis and capitalization added.)

Justice Brennan, also writing for Justices White, Marshall, and Blackmun, did not subscribe to Justice O'Connor's purposeful availment reasoning. Their rationale for no need for a showing of "additional conduct" was that "[t]he 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." (Id. at p. 117.)

But Justice Stevens did not endorse either approach; instead, he advocated for a quantum-based approach to determining minimum contacts: "Whether or not [mere awareness] rises to the level of purposeful availment requires a constitutional determination that is affected by the volume, the value, and the hazardous character of the components." (Id. at p. 122.)

In sum, Asahi did not give an unequivocal answer as to what degree of activity constitutes purposeful availment. But the Court in J. McIntyre “reconcile[d] the competing opinions.” (J. McIntyre, supra, 564 U.S. at p. 883 (emphasis added), see also p. 879 ["This Court's Asahi decision may be responsible in part for that court's error regarding the stream of commerce, and this case presents an opportunity to provide greater clarity."].)

In J. McIntyre, the New Jersey Supreme Court ruled that the state could exercise jurisdiction over a British manufacturer of scrap metal machines that injured a plaintiff in the state. (Id. at p. 886.) The Court reversed concluding that J. McIntyre was not subject to jurisdiction in New Jersey because it at "no time had [] advertised in, sent goods to, or in any relevant sense TARGETED the State." (Id. at p. 877, capitalization added; see also p. 882 ["The 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 State."], emphasis added.) The Court differentiated between marketing and sales efforts at the United States versus the forum state.

Here the question concerns the authority of a New Jersey state court to exercise jurisdiction, so it is petitioner's purposeful contacts with New Jersey, not with the United States, that alone are relevant. Respondent has not established that J. McIntyre engaged in conduct purposefully directed at New Jersey. Recall that respondent's claim of jurisdiction centers on three facts: The distributor agreed to sell J. McIntyre's machines in the United States; J. McIntyre officials attended trade shows in several States but not in New Jersey; and up to four machines ended up in New Jersey. The British manufacturer had no office in New Jersey; it neither paid taxes nor owned property there; and it neither advertised in, nor sent any employees to, the State. Indeed, after discovery the trial court found that the “defendant does not have a single contact with New Jersey short of the machine in question ending up in this state.” App. to Pet. for Cert. 130a. These facts may reveal an intent to serve the U.S. market, but they do not show that J. McIntyre purposefully availed itself of the New Jersey market. (Id. at p. 886, emphasis added.)

As for the use of distributors in potentially shielding manufacturers from liability, that concern was addressed in J. McIntyre, but by the dissenting Justices.

A foreign industrialist seeks to develop a market in the United States for machines it manufactures. It hopes to derive substantial revenue from sales it makes to United States purchasers. Where in the United States buyers reside does not matter to this manufacturer. Its goal is simply to sell as much as it can, wherever it can. It excludes no region or State from the market it wishes to reach. But, all things considered, it prefers to avoid products liability litigation in the United States. To that end, it engages a U.S. distributor to ship its machines stateside. Has it succeeded in escaping personal jurisdiction in a State where one of its products is sold and causes injury or even death to a local user?

Under this Court's pathmarking precedent in International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), and subsequent decisions, one would expect the answer to be unequivocally, “No.” But instead, six Justices of this Court, in divergent opinions, tell us that the manufacturer has avoided the jurisdiction of our state courts, except perhaps in States where its products are sold in sizeable quantities. Inconceivable as it may have seemed yesterday, the splintered majority today “turn[s] the clock back to the days before modern long-arm statutes when a manufacturer, to avoid being haled into court where a user is injured, need only Pilate-like wash its hands of a product by having independent distributors market it.” Weintraub, A Map Out of the Personal Jurisdiction Labyrinth, 28 U.C. D. L.Rev. 531, 555 (1995). (Id, at pp. 893-894, emphasis added) (Ginsburg, J., dissenting).

Here, though not argued by Powermax, AVI does not analyze J. McIntrye and J. McIntyre was decided after Bridgestone; thus, Bridgestone HAS BEEN SUPERSEDED BY J.MCINTYRE.^[16] Therefore, as J.McIntyre is binding precedent upon this court, the court follows the principles set forth by the high court.

To the extent that AVI seeks supplemental discovery, as noted by AVI itself, the parties have been engaged in previous lawsuits such that the parties have already obtained the relevant discovery needed.

Conclusion

Based on the foregoing, the motion is granted.