Fourteenth Amendment, Section 1:
All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
Jurisdiction may be defined as the power of a government to create legal interests, and the Court has long held that the Due Process Clause limits the abilities of states to exercise this power. 1 In the famous case of Pennoyer v. Neff, 2 the Court enunciated two principles of jurisdiction respecting the states in a federal system 3: first,
every State possesses exclusive jurisdiction and sovereignty over persons and property within its territory, and second,
no State can exercise direct jurisdiction and authority over persons or property without its territory. 4 Over a long period of time, however, the mobility of American society and the increasing complexity of commerce led to attenuation of the second principle of Pennoyer, and consequently the Court established the modern standard of obtaining jurisdiction based upon the nature and the quality of contacts that individuals and corporations have with a state. 5 This
minimum contacts test, consequently, permits state courts to obtain power over out-of-state defendants.