Vanderbilt Journal of Transnational Law

First Page



With the increase in international trade, civil litigation between persons of different nationalities has become increasingly important. Today alien and foreign corporations are being brought before American courts to defend actions arising out of products liability, contract, and tort. There is considerable authority holding alien and foreign corporations amenable to jurisdiction on the basis of a single act or business transaction. The states themselves are affecting international trade since state law is chosen to determine the amenability of alien and foreign corporations to suit in diversity actions in federal court.

This survey presents a cross-section of recent cases and attempts to distinguish the treatment given alien corporations from the treatment given foreign corporations. While a variety of actions is represented, the majority of the cases deal with products liability. Generally, these cases concern an alien corporation's contacts with a particular state, although some courts might look to contacts with the United States as a whole in determining whether to assume jurisdiction in some types of cases. Recurrent considerations which appear throughout include: (1) whether the corporation has availed itself of the privilege of conducting business within the forum state; (2) whether the corporation knew its product was destined for the forum state; (3) whether the assumption of jurisdiction would violate traditional notions of fair play; (4) whether the plaintiff could realistically bring suit in the alien forum; (5) whether the alien corporation set its product in the normal stream of commerce; and (6) whether an American corporation is an alter ego of the alien corporation. While these considerations are largely derived from the major cases in which suit was brought against foreign corporations in a particular state, the courts balance the same considerations and apply the same standards to alien corporations in determining whether jurisdiction is proper. However, it has been advocated that a different standard should be applied in cases where alien corporations are involved.