The U.S. Court of Appeals said yesterday that Fiat Motors of North America Inc. can be sued in the District for an auto accident that occurred here, even though Fiat has no offices or dealerships in Washington, the accident victim lives in Maryland and the car was registered outside the city.
The appeals court held that Fiat derives "substantial revenue" from the sale of Fiats eventually used in Washington and is therefore within reach of the District's so-called "long-arm" statute.
The long-arm statute gives the District courts jurisdiction over out-of-state persons and businesses that have certain ties to the District.
The appeals court held yesterday that when a court claim stems from an injury that occurred in the District, the out-of-state defendant is subject to jurisdiction here if it regularly does or solicits business in the District, engages in ongoing conduct here or "derives substantial revenue" from goods used or services rendered in the District.
The three-judge appeals panel noted that Fiat cars sold and used in the District, worth more than $3 million annually and representing more than 1.5 percent of Fiat sales, amount to "substantial revenue."
The court also rejected Fiat's claim that jurisdiction in this case would violate its constitutional right to due process because the District had no special governmental interest in the case and that its exercise of jurisdiction would be unreasonable and unfair.
Judge Carl McGowan, writing for the court, said, however, that the law's requirement that the injury take place in the District recognizes the city's "interest in preventing defective products from crossing its borders and causing injury in its work places or dwellings." Senior Judge David L. Bazelon and Judge Roger Robb joined McGowan in the decision, reversing a lower court ruling in August 1978 by U.S. District Court Judge Aubrey E. Robinson Jr.
McGowan also noted that the victim, Wyllie Gatewood, was treated in a District hospital, that local police investigated the October 1976 accident, and that witnesses may live here.
The federal appeals court did not address the broader question of jurisdiction when the injury itself is the defendant's sole contact with the locality where the lawsuit is brought.