The case of Asahi Metal Industry Co., Ltd. v. Superior Court of California, Solano County, addressed the issue of whether a foreign defendant's knowledge that their products would reach the forum State in the stream of commerce constitutes "minimum contacts" for the exercise of jurisdiction. Asahi sold tire valve assemblies to Cheng Shin in Taiwan, which were incorporated into tire tubes sold worldwide, including in California. Cheng Shin sued Asahi for product defects in California, but Asahi argued that California could not exert jurisdiction over it. The US Supreme Court later established that a defendant can only be subject to personal jurisdiction in a state if they purposefully established "minimum contacts" in the forum state. The mere placement of a product into the stream of commerce is not enough to establish jurisdiction. Additional conduct of the defendant, such as designing the product for the market in the forum state or advertising in the forum state, may indicate an intent to serve the market in the forum state. The lower court's decision was not specified.

The Superior Court of California cannot have personal jurisdiction over Asahi, a Japanese corporation, as they did not intentionally target the California market and have no business presence, advertising, or design for sales in California. The regular and anticipated flow of products is not enough to establish minimum contacts with California. The burden on Asahi is severe, and the interests of the plaintiff and the forum in California's jurisdiction over Asahi are minimal. The judgment of the Supreme Court of California is reversed, and the case is remanded for further proceedings. Justice Brennan and Justice Stevens disagree with some parts of the Court's opinion.