State v. LG Electronics, Inc., 341 P.3d 346

Background

Washington Attorney General sued 20+ foreign corporations alleging a worldwide conspiracy to fix prices and limit production of cathode ray tubes (CRTs), harming Washington consumers and agencies under the Washington Consumer Protection Act (CPA).
Defendants were foreign manufacturers of CRT components that sold those components into the stream of commerce; CRT-containing consumer products were sold in large numbers in Washington during the conspiracy period.
After accepting service but before discovery, several defendants moved to dismiss for lack of personal jurisdiction under CR 12(b)(2), submitting affidavits denying sales or business in Washington; the trial court granted dismissal and denied jurisdictional discovery.
The Attorney General appealed; the appellate court treated the complaint’s allegations as true for jurisdictional purposes and reviewed de novo.
The court held the Attorney General alleged sufficient minimum contacts to support specific jurisdiction because the defendants’ products entered Washington in a regular, high-volume course, and exercising jurisdiction would comport with fair play and substantial justice; the dismissal was reversed and the case remanded.
Trial-court award of attorneys’ fees to defendants was vacated because they were no longer prevailing parties on appeal.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Washington courts have specific personal jurisdiction over foreign CRT manufacturers	High-volume, integrated-component sales into Washington create purposeful, minimum contacts supporting jurisdiction under the CPA and due process	Nationwide distribution alone (via independent distributors) without targeting Washington or only isolated sales is insufficient for jurisdiction; affidavits rebut allegations	Held: Allegations (treated as verities pre-discovery) show a regular flow/large volume into Washington; specific jurisdiction exists and dismissal was erroneous
Whether complaint allegations may be treated as true when defendants submit contrary affidavits on a pre-discovery CR 12(b)(2) motion	Complaint allegations should be treated as established for prima facie jurisdictional showing; discovery may follow	Defendants argued plaintiff must produce evidence when defendants submit sworn contrary evidence	Held: Washington precedent requires treating pleadings as verities at this stage; defendants’ affidavits do not automatically convert the motion to summary judgment; plaintiff entitled to discovery or to survive on prima facie allegations
Whether the Attorney General’s claims "arise out of or relate to" defendants’ contacts with Washington	Alleged price-fixing caused supracompetitive prices for CRT products sold in Washington, so the claims arise from those contacts	Defendants contended purchases were by independent third parties, breaking causal link	Held: Indirect sales through third parties that cause foreseeable harm in forum suffice; the claims arise from defendants’ contacts
Whether exercising jurisdiction would violate fair play and substantial justice	Washington has strong interest in redressing harm to its residents and indirect purchasers; inconvenience to defendants is outweighed	Defendants argued defending in Washington is burdensome and unfair given their foreign status	Held: Given Washington’s interest, the nature/extent of contacts, and modern distribution, jurisdiction is reasonable and does not offend due process

Key Cases Cited

International Shoe Co. v. Washington, 326 U.S. 310 (established minimum-contacts test for personal jurisdiction)
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (foreseeability alone is insufficient; purposeful availment required)
Burger King Corp. v. Rudzewicz, 471 U.S. 462 (minimum contacts and reasonableness factors for specific jurisdiction)
Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102 (stream-of-commerce and fair-play analysis)
Daimler AG v. Bauman, 134 S. Ct. 746 (distinguishing specific and general jurisdiction; limits on general jurisdiction)
Walden v. Fiore, 134 S. Ct. 1115 (contacts must arise from defendant’s own relationship with the forum)
J. McIntyre Machinery, Ltd. v. Nicastro, 131 S. Ct. 2780 (plurality/controlling concurrence on when nationwide distribution supports jurisdiction)
AU Optronics Corp. v. State, 180 Wn. App. 903 (Washington appellate precedent applying McIntyre to component manufacturers and finding sufficient contacts when high-volume sales into forum are alleged)
Willemsen v. Invacare Corp., 352 Or. 191 (Oregon Supreme Court applying McIntyre concurrence to find regular course of sales sufficient for jurisdiction)