Globalization exploits what economist call the "comparative advantage" of one country over another in the production of particular goods or services. We may suppose, for example, that the snooty French produce superior fashion designers and more pleasing perfumers and that the grim Germans engineer the finest sports cars. We may also posit that nations with an abundance of skillful workers enjoy an edge over ones with a shortage; their labor costs less.
India fits the description in the latter example. And apparently the Subcontinent's plenitude of low-wage software developers prompted a dispute that today landed before the Fourth Circuit.
Structure Works, a Colorado outfit, retained Geometric Software, an Indian corporation, to help with a structural design and software project. Structure Works also brought in Consulting Engineers, a Virginia company that operated branch offices in India, to, um, consult. The interactions resulted in two non-disclosure agreements, one between Consulting Engineers and Structure Works and another between Consulting Engineers and Geometric Software. Both prohibited hiring of Consulting Engineers employees.
The role of Consulting Engineers didn't work out in the project, but the contacts seem to have led Geometric Software to breach the no-hire clause when it gave a job to Manoj Kumar. Consulting Engineers sued Structure Works and Geometric Software in Virginia. The district court dismissed for lack of personal jurisdiction.
The Fourth Circuit upheld the dismissal. The few contacts that touched Virginia did not, the court concluded, satisfy due process requirements. Yes, Structure Works and Geometric Software participated in telephone calls and emails involving Consulting Engineers, but none of that amounted to purposeful availment of the right to do business in the Old Dominion. And of course the dispute centered on an outsourcing arrangement for work on the other side of the world and, particularly, the improper luring away of an Indian employee in India. Consulting Engineers Corp. v. Geometric Ltd., No. 07-1453 (4th Cir. Mar. 23, 2009).
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