Chinese companies exporting products into the United States or doing business with U.S. companies fear being sued in U.S. courts for intellectual property infringement. Consider the following scenario: A Chinese company makes and distributes products around the world. Although some of these products eventually enter the United States, the Chinese company has no offices in the United States, no employees in the United States, and does not sell any products directly in the United States. Can this Chinese company be sued in the United States? The answer might be yes.
The U.S. Supreme Court recently issued two decisions on the same day addressing this very scenario, in J. McIntyre Machinery, Ltd. v. Nicastro, No. 09-1343 (U.S. June 27, 2011) and Goodyear Dunlop Tires Operations, S.A. v. Brown, No. 10-76 (U.S. June 27, 2011). This article will explain how foreign corporations can be sued in the United States, review the U.S. Supreme Court’s decisions in J. McIntyre and Goodyear, and discuss related strategies for Chinese companies to minimize business disruption caused by IP infringement actions.
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