The stream-of-commerce theory is a legal principle that allows a state to assert personal jurisdiction over a defendant if that defendant has placed a product into the general marketplace. This theory applies when the product causes injury or damage within the state, and the defendant has engaged in additional actions to establish a connection with that state, such as advertising or employing a sales agent there.
This theory is primarily used in tort law, particularly in cases involving product liability. It allows individuals to hold manufacturers or distributors accountable for harm caused by defective products. Users can often manage related legal processes themselves with the right tools, such as templates provided by US Legal Forms.
Here are a couple of examples of abatement:
Example 1: A toy manufacturer based in California sells products nationwide. If a child in Texas is injured by a defective toy, the manufacturer could be subject to personal jurisdiction in Texas due to their distribution practices and marketing efforts in that state.
Example 2: A car manufacturer from Michigan advertises its vehicles in Florida and sells them through local dealerships. If a defective vehicle causes an accident in Florida, the manufacturer may be held liable under the stream-of-commerce theory. (hypothetical example)
Examples of state differences (not exhaustive):
| State | Notes |
|---|---|
| California | Broad application of the stream-of-commerce theory, often favoring plaintiffs. |
| Texas | Requires a clear connection between the defendant's actions and the forum state. |
| New York | Focuses on the foreseeability of the product reaching the state. |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Definition | Key Differences |
|---|---|---|
| Stream-of-Commerce Theory | Allows jurisdiction based on product distribution and connections to the state. | Focuses on the defendant's actions and connections. |
| Minimum Contacts | Refers to the general standard for establishing jurisdiction based on a defendant's connections to a state. | Minimum contacts can apply to various activities, not just product distribution. |
If you believe the stream-of-commerce theory applies to your situation, consider the following steps:
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It is a legal principle that allows a state to assert jurisdiction over a defendant based on their product distribution and connections to the state.