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Longhorn Industries Inc. V. Widget Corporation Case Summary

1267 Words6 Pages

MBA625_FINAL PROJECT 1
November, 2015
Internal Analysis: Longhorn Industries, Inc. v. Widget Corporation
Widget Corporation has recently received a summons for a suit brought by a customer in Texas. While seeking legal counsel, an internal analysis was conducted to better understand the potential legal issues with this case. This report provides that analysis, looking at the procedural and substantive aspects of this suit.
Background
Widget Corporation
Located in California, Widget Corporation (“Widget”) is incorporated in Delaware, a state where more than half the Fortune 500 companies are incorporated. (Top 5 Reason to Incorporate in Delaware, 2007) This is common for companies to incorporate in a state other than where they are headquartered, …show more content…

The long-arm statute, which applies in diversity of citizenship cases, is used to determine state jurisdiction. Each state and the District of Columbia have enacted their own long-arm statutes. Generally, to apply the long-arm statute the defendant need only have minimum contact with the plaintiff’s state, as determined by the United States Supreme Court in International Shoe Co. v. Washington. 326 U.S. 310 (1945). (The Gale Group, Inc., 2008)
Texas statute provides that a non-resident that “performs the contract in whole or in part in this state” (§17.042(2)) is subject to Texas’ long-arm statute and has to answer to a lawsuit there. With all of this said, Widget most likely does not have grounds for a challenge to have the case heard in a state where Widget either does business or is incorporated.
However, challenges to International Shoe are becoming commonplace in a world that has evolved since 1945, especially with the advent of the internet. Zippo Manufacturing v. Zippo Dot Com. 952 PA 1119. (W.D. Pa. 1997) showed that the courts are at least considering these challenges. (The Gale Group, Inc., 2008) Though this may allow for the potential for Widget to challenge on the jurisdictional grounds of non-residency, it would be a long shot and is not a recommended course of

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