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Internet Jurisdiction John Swinson February 2003.

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1 Internet Jurisdiction John Swinson February 2003

2 Typical questions  If I operate a website in Brisbane and do something which is legal in Queensland, can I be sued outside of Queensland?  If I enter into a transaction via the Internet with someone outside of Queensland, can I be sued there?  If someone outside of Queensland does something using the Internet that harms me, can I sue that person in Queensland?

3 “Jurisdiction” 1.A government’s general power to exercise authority over all persons and things within its territory. 2.A court’s power to decide a case or issue a decree. 3.A geographic area within which political or judicial authority may be exercised.

4 Jurisdiction  The law of personal jurisdiction  Jurisdiction over a person  Can the defendant be made to fight a court case in the court selected by the plaintiff?  Many Internet cases, because this is an issue that is often first to arise

5 Example case Bensusan Restaurant Corp v. King (44 USPQ2d 1051 (2nd Cir. 1997))  Bensusan operated a famous NY jazz restrauant called “The Blue Note” and had a trademark registration for “The Blue Note”.  King operates a small club in Missouri called “The Blue Note.” In 1996, King created a website.  Bensusan sued King in NY.

6 Blue Note  Appeal Court decided that no personal jurisdiction  Is there a connection with NY? –Commits a tortious act in NY? –Commits a tortious act outside of NY that causes injury in NY? –“King's "Blue Note" cafe was unquestionably a local operation.”

7 Local Court Rules  Many cases turn on local court’s interpreting their local court rules or statutory provisions.  It is probably not worthwhile focusing only on Queensland rules, because you could have a Queensland client sued outside of Queensland in another court that will not apply Queensland rules.  Can we find some unifying theory across all jurisdictions?

8 Can we find a unifying theory?  We can group the cases by cause of action: –Defamation –Trademark infringement –Domain names –Breach of contract (& Ebay cases) –Consumer protection –Criminal conduct

9 The U.S.: three types of websites The sliding scale analysis (Zippo Manufacturing case)  Interactive, transactional website  Passive website  Middleground

10 Sliding Scale Analysis Interactive, transactional website  Def does business over the Internet, enters contracts with residents of foreign jurisdictions that involve knowing and repeated transmission of files over the Internet  Def does business with plaintiff in another place.  Plaintiff can sue in plaintiff’s home town

11 Sliding Scale Analysis Passive Website  Def simply posts information on website which is accessible to others  Plaintiff cannot sue in plaintiff’s home town, without other connection with the jurisdiction

12 Sliding Scale Analysis Middleground  Interactive website where information can be exchanges  Decided on a case-by-case basis: examine the level of interactivity and nature of the exchange that occurs on the website

13 Sliding Scale Analysis Morantz case (PA)  P sold machines that cleaned window blinds  D opened cleaning business in NY and had national toll free telephone number  P sued D for TM infringement due to logo on website  Court analysed the website: –Downloadable order form for promotional video –Form to request additional information –Link that user could click to send email –No sales via website –Volume of information exchange is small

14 Calder v Jones effects test (also U.S.)  Devised for defamation cases, and now applied to Internet cases generally 1.Def committed an intentional tort 2.Pl felt the brunt of the harm caused by the tort in the jurisdiction such that the jurisdiction is the FOCAL POINT of the PL’S INJURY 3.Def expressly aimed the tortious conduct at the forum.

15 Example of Calder test Griffis v. Luban (MN Supreme Court, July 2002)  G is resident of Alabama  L is resident of MN  L defamed G in archaeology newsgroup –“obtained her degree from a box of crackers” –Liar, fake degree, not affiliated with Uni of AL  G sued L in AL; L didn’t appear, so G got default j.

16 Griffis v. Luban  G then tried to enforce her judgment in MN  L challenged the jurisdiction of the AL court.  Supreme Court of MN would not enforce the judgment of the AL court.  Decision focused on “express aiming”.  “The fact that the messages could be read in AL, just as they could be read anywhere in the world, cannot be sufficient to establish AL as the focal point of the defendant’s conduct.”  Effect and focal point of conduct

17 Matt Pavlovich v. DVD Copy Control Assn.  DVDs have CSS technology to prevent copying  Matt lived in Texas; did not live or work in California  Matt operated a website that provided information only, including a list of links about DVD technology for LINUX. Also posted source code for DeCSS.  Sued in California for trade secret misappropriation  “knew these actions would adversely impact an array of businesses in CA, including motion picture and consumer electronic industries.”

18 Pavlovich  The sliding scale test did not work.  Calder effects test applied  Creating a website may have effects that are felt worldwide, but without more, it is not an act purposely directed at the forum State.  Did Matt intentionally target California?  Matt knew he would harm the motion picture industry.

19 Pavlovich  Foreseeability of harm not sufficient for jurisdiction, as then all torts would be subject to where D is  Can’t say all torts effecting motion pictures should be in California. Otherwise, all potato cases would be in Idaho.  If P was correct, then “Australia student that makes backup program technology and distributed in Australia would be subject to jurisdiction in California”  Matt may still face the music, but not in California.

20 Dow Jones v. Gutnick (Australia)  DJ publishes Barron’s Magazine in the US.  DJ operates the website, that includes the text of the current edition of Barron’s Magazine  Article titled “Unholy Gains” that referred to Joe Gutnick. The article warns U.S. business about Joe.  Joe claims that the article is defamatory and sued DJ in Victoria.  Joe lives in Victoria, but operates businesses elsewhere, including the U.S.

21 Dow Jones v. Gutnick  In the Supreme Court of Victoria, DJ challenged jurisdiction of the Victorian court.  The Court decided that it had jurisdiction, so DJ appealed to the High Court of Australia.  Issues: –Where was the article published? –Should the case be stayed because Victoria was a clearly inappropriate forum for that determination?

22 Dow Jones v. Gutnick  At the trial, Joe said that he would only sue in Victoria, and that he wanted only to have his Victorian reputation vindicated by the Courts in the State in which he lives.

23 Dow Jones v. Gutnick  Was the online article published in: –NJ, where the server was located –Victoria, where is could be read  DJ said it was preferable to an Internet publisher to be subject to only one law, which is the place where its servers are located (unless that place was merely opportunistic). Otherwise, DJ would have to take account of the law in every country.

24 Dow Jones v. Gutnick  “Certainty does not mean singularity”  “Activities that have effects beyond the jurisdiction in which they are done may properly be the concern of the legal system in each place.”  For defamation, the harm is where the reader is.  HCA looked at newspaper, radio and TV cases: the place of publisher’s conduct is not the place of publication.

25 Dow Jones v. Gutnick  Was Victoria “clearly inappropriate”? –Joe confined his claim to his reputation in Victoria as a consequence of publication that occurred in that place –Law of Victoria would apply –Victoria not “clearly inappropriate”  Downside for Joe: damages are limited to Victoria.

26 Statements in Gutnick  More difficult if claim was for damage to reputation in more than one jurisdiction.  The reasonableness of publisher’s conduct – should it be considered at the publisher’s location?  Only should get substantial damages if Plaintiff has reputation in place of publication  Can judgment be enforced in place where D has assets?  Is Afghanistan to Zimbabwe a real issue: Will not be hard to identify likely jurisdictions where you may be sued – just look at where the Defendant lives.

27 Effects of Gutnick  anyone who places information on a website must take into account the laws of all the places where the website is accessible  there is no single legal system that applies to websites  foreign publishers must take into account Australian laws if their websites are accessible in Australia  Australia may become the centre-point for all defamation actions involving the Internet, provided that the person defamed is known in Australia.  if Mick Jagger is defamed on a Dutch publisher's website, he may choose to sue the publisher for defamation in Australia rather than England or Holland.

28 Gutnick and U.S. law  Could Joe enforce his Victorian judgment in the U.S? –Not if the U.S. court applies the Griffis v. Luban decision –DJ expressly aimed its conduct at U.S. businesses  If Joe Gutnick had a website in Australia that defamed DJ, could DJ sue Joe in NY?

29 Differences in approaches  Just because the website is accessible here does not mean that this court has jurisdiction. Otherwise, this court would have jurisdiction over all websites, regardless of where located.  Just because the website is accessible everywhere does not mean that this court should not have jurisdiction. Otherwise, websites that are accessible here may not be subject to this court’s jurisdiction.

30 Attorney General of MN’s statement “Persons outside of Minnesota who transmit information via the Internet knowing that the information will be disseminated in Minnesota are subject to jurisdiction of Minnesota courts for violations of state criminal and civil laws.” Attorney General of Minnesota, Hubert Humphrey III, 1995

31 Other issues  California Computer Crimes legislation  What should Amazon do?  E-Bay cases – seem to ignore Internet aspect of the case  What is the effect of a notice: “This website is intended for residents of Brisbane only.”  France’s prosecution of Yahoo for Nazi memorabilia  China’s self-help approach  Is there a need for an international treaty?

32 Domain Name Disputes  UDRP –By contract when register domain name –All registrars must agree to this regime –Does not exclude court’s jurisdiction –Self enforcing –No damages  Harrods and Porche cases – in rem jurisdiction under Anti- Cybersquatting Consumer Protection Act.

33 Practical Advice How should you advice a client in this area?

34 Unifying Theme?

35 Other resources    Older cases:  

36 Other resources THE REAL THREAT OF INTERNET JURISDICTION This week’s Michael Geist’s Toronto Star Law Bytes column examines recent Internet jurisdiction developments arguing that the real threat comes not from high profile cases such as Gutnick and Kazaa but rather from statutory developments that adopt an expressly extra- territorial approach. In particular, recent decisions interpreting the Anticybersquatting Consumer Protection Act ensure that U.S. law applies to every dot-com domain, regardless of where it was registered, when it was registered, or what a foreign court has to say about it.

37 Internet Jurisdiction John Swinson

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