The Seventh Circuit has declined to adopt any specialized framework for analyzing personal jurisdiction over out-of-state defendants when the alleged conduct occurs over the Internet.
Instead, the court held that traditional minimum-contacts analysis is appropriate, agreeing with the approach taken by the Wisconsin district court in Hy Cite Corp. v. Badbusinessbureau.com, L.L.C., 297 F.Supp.2d 1154 (W.D.Wis.2004).
In doing so, the court declined to follow the approach used by most courts, originally formulated in Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119 (W.D.Pa.1997).
“[W]e hesitate to fashion a special jurisdictional test for Internet-based cases,” Judge Diane S. Sykes wrote for the court. “[Calder v. Jones, 465 U.S. 783 (1984)] speaks directly to personal jurisdiction in intentional-tort cases; the principles articulated there can be applied to cases involving tortious conduct committed over the Internet.”
The plaintiff is John Tamburo, an Illinois resident who operates a dog-breeding software business in Illinois.
After Tamburo developed a software program using data he obtained from the Web sites of other dog-pedigree businesses, they retaliated by accusing him of stealing their data and urging dog enthusiasts to boycott his products.
Tamburo sued in Illinois federal court, alleging defamation among other claims, but the district court dismissed the claims for lack of personal jurisdiction.
The Seventh Circuit reversed as to all defendants, save for one based in Australia, because that defendant merely received messages from the others and reposted them on a private listserve.
The other defendants were based in Colorado, Michigan, Ohio, and Ottawa, Canada, respectively.
The court first held that the Illinois court did not have general personal jurisdiction over any of the defendants, because they had only sporadic or isolated contacts with Illinois.
However, it held that the court did have specific personal jurisdiction, because the defendants purposefully directed their activities at Illinois.
Essential to the finding is that Tamburo alleged intentional torts. Accordingly, the court looked for guidance to the U.S. Supreme Court opinion in Calder, a case involving defamation by a print publication, the National Enquirer.
The Supreme Court in Calder held that, although the paper is based in Florida, suit was proper in California, because that is where the plaintiff lived, and thus, where she would suffer the brunt of her injuries from any defamation.
Because Calder involved intentional torts, the Seventh Circuit found it more relevant to the case at bar than more recent cases dealing with personal jurisdiction over Internet activity generally.
Applying Calder, the court found jurisdiction in Illinois was appropriate, because the defendants knew Tamburo lived there, and even included his Illinois address in the postings, encouraging readers to contact and harass him there.
However, the court held that jurisdiction in Illinois was not proper as to the Australian defendant, which merely reposted the others’ postings on a listserve. The court found no evidence in the record that the Australian defendant even knew that Tamburo operated his business in Illinois.
Accordingly, the court affirmed the district court’s dismissal of that defendant, although it reversed as to the others.
Eugenia Carter, an attorney with Whyte Hirschboeck Dudek, who successfully represented the defendant in the Hy Cite Corp. case, noted two elements she thought were key to the court’s holding: the plaintiff was an individual, rather than a business entity; and the claim alleged was a personal tort.
“When an individual is involved, it is more reasonable to infer that the brunt of the effects will be borne in the state where the individual lives,” Carter observed.
Carter added that, in the Hy Cite Corp. opinion, Judge Crabb prophetically acknowledged that jurisdiction might be present if the case involved a personal tort and an individual plaintiff.
“While the Seventh Circuit took into account that the alleged defamation occurred on the Internet,” Carter said, “that fact alone is not a reason to abandon traditional minimum-contacts analysis.”
David Ziemer can be reached at email@example.com.