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«I. INTRODUCTION We often hear what the Internet can do for us. We should also think about what the Internet can do to us.' An amalgam of ...»

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Summer 2005] know what, if any, interactive Web services will subject his or her site to the constraints of personal jurisdiction on a court-by-court basis. Even in this question's relative infancy, it has posed problems for resolving the legal ramifications of Web design; legal practitioners have already raised the concern that "[a]nyone who has a web site or is thinking about having a web site should remember that the web site may establish 'presence' in another state. The nature and extent of that 'presence' may subject [a] website owner to the jurisdiction of courts in other states."2 5 Ultimately, what is necessary is a clearer delineation by the courts of what constitutes a Web site that is interactive enough to establish personal jurisdiction based on that Web presence alone, as well as a means of analyzing sites that are less interactive but may in fact be one contact among many for ajurisdictional analysis.

A. "Active" versus "Passive" Web Sites For purposes of determining whether or not their sites will subject them to personal jurisdiction, Web site creators and administrators need to know whether or not their site is "active" enough to establish the necessary contacts. As did the vast majority of other state courts that followed the Zippo Manufacturing"sliding scale" rationale, 0 6 the New Mexico Court of Appeals did not delineate exactly what types of sites fall under the labels "passive," "active," or "middle ground., 20 7 From the facts and holding of Sublett, all that one can be sure of is that the Pillar To Post Web site, with its ZIP code locator and franchise information, absent any other interactive feature, was "passive" in nature. 0 8 Further, under Sublett, it would take a greater degree of interactivity before the site could be considered "active" such that jurisdiction would be upheld. 2 9 As a result, Web designers, regardless of whether or not they contemplate that their information will necessarily be viewed in New Mexico, have little guidance in knowing whether or not their site is "active" enough to subject them to personal jurisdiction within this state.

If Web interactivity, whereby one piece of information is exchanged for another,210 truly is the benchmark, then it may be that a site program such as a login script or sales profile would subject a Web site owner/operator to personal jurisdiction. However, divining just what kind of information must be exchanged is another matter. The New Mexico Court of Appeals seemingly rejected the use of a store locator program as grounds for finding a site to be "active" sufficient for purposes of personal jurisdiction.2 ' Such a program merely asks for an individual's ZIP code or street intersection, information that is neither highly unique nor personal.2 2 Perhaps the exchange of more personalized information, such as a

205. Palmisano, supra note 1.

206. See supra notes 117-129 and accompanying text.

207. See Sublett, 2004-NMCA-089, 30, 94 P.3d at 853.

208. Id.

209. Id. 1 33, 94 P.3d at 853.

210. Ralph F. Wilson, Web Interactivity and Customer Focus, WEB MARKETING TODAY, Aug. 25 1996, available at http://www.wilsonweb.com/articles/interactive.htm (last visited Mar. 25, 2005).

211. Sublett, 2004-NMCA-089, 30,94 P.3d at 853.

212. See Wikipedia, ZIP Code, availableat http://en.wikipedia.org/wiki/ZIPCode (last visited Mar. 25, 2005).

NEW MEXICO LA W REVIEW [Vol. 35 name, address, phone number, and certainly credit card number, would suffice to make a site "active" under the Sublett ruling.

B. Applications of Web-Based Jurisdictional Law Given the current state of Internet growth and the ease with which parties, from individuals to corporations, can establish a Web presence,2" 3 there are literally millions of potential plaintiffs who could attempt to assert jurisdiction via the Internet. The implications of Web-based jurisdiction may very well change based upon the size of the defendant. Take, for example, Wal-Mart, the world's leading retailer.2" 4 This corporation not only has a physical retail presence in every state in the United States, but it also maintains a Web site where customers may place orders online." 5 In analyzing whether Wal-Mart has minimum contacts within any given state, its Web presence is almost superfluous, because its physical presence and business activities are already established with its brick-and-mortar stores.

Contrast this with a company such as Hastings, a media retailer that also has a customer service-based Web presence,2" 6 but only has a physical presence within twenty U.S. states.21 7 A customer can transact business with Hastings via this site by placing an order for a product, thereby giving Hastings personal and credit information online.21 8 However, given the lack of clarity on whether or not even this exchange could be construed as "active" under Internetjurisdictionjurisprudence, 1 9 Hastings and companies like it will remain uncertain whether or not a customer in a remote state could assert jurisdiction based on the company's Web presence alone.

By and large, it may very well make sense to allow large corporations with both a massive Web presence and brick-and-mortar stores nationwide to be sued in any American forum. 220 However, the development of a vague rule that allows individuals to drag smaller companies, or vice versa, "far across the country to defend themselves from content related claims based upon a few hundred hits on a Web site in that state" may not make for good policy. 2 1 To do so would require such entities to keep tabs on the laws of every state in the nation, when their intent may be to do nothing more than to sell products or spread ideas locally. More than anything, it is best that those who maintain a Web presence, no matter what the size or nature of it, know exactly what their site may subject them to in the realm of litigation.





213. See supra text accompanying notes 72-99.

214. National Retail Federation, Retail Companies, at http://www.nrf.com/content/default.asp?folder= foundation/caradvc&file=retailCompany.htm&bhcp=l (last visited Mar. 25, 2005).

215. See Walmart.com, at http://www.walmart.com.

216. See Hastings Internet, Inc., at http://www.gohastings.com.

217. Hastings maintains brick-and-mortar stores in Alabama, Arizona, Arkansas, Colorado, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Missouri, Montana, Nebraska, New Mexico, Oklahoma, Tennessee, Texas, Utah, Washington, and Wyoming. Hastings Internet, Inc., Stores By State, at http://www.gohastings.com/About/ stores.asp (last visited Mar. 25, 2005).

218. Hastings Internet, Inc., Safe Shopping Guarantee, at http://www.gohastings.com/Help/newuser/ safeshopping.stm#safeshopping (last visited Mar. 25, 2005).

219. See supra notes 113-115 and accompanying text.

220. Mahar, supra note 202.

221. Id.

PERSONAL JURISDICTION

Summer 2005] C. The Nature of Litigation May Inform When Web-Based PersonalJurisdiction Is Upheld In addition to the "passive" site versus "active" site issue, the Sublett ruling also left open the question of whether or not Internet-based personal jurisdiction could be upheld in cases of defamation, libel, or trademark actions involving a passive Web site, though the court contemplated the possibility of such a finding.222 The possibility of allowing for different Internet-based personal jurisdiction standards based upon the nature of the suit brought against a defendant is also problematic.

The argument has been made that, "because the Internet is bringing unsophisticated and poorly capitalized people into new situations where they are more likely than ever to make innocent mistakes and be sued for them, due process guarantees should be more robust in this new environment than they have been in more traditional commercial settings. 223 Individual Web designers and bloggers can, and will, make mistakes concerning the content of their Web sites and electronic communications. With a vague standard for personal jurisdiction, suits for defamation, copyright infringement, and trademark infringement, as well as suits for relief in connection with other content-related claims, will be filed against these "unsophisticated and undercapitalized" designers. 24

1. Defamation and Libel Litigation It is possible that a mere posting of information on a Web site could alone be the basis to find jurisdiction in a foreign state if the information involves defamatory statements that are expressly directed at a resident of that state. In Calder v.

Jones, the U.S. Supreme Court upheld jurisdiction in a case involving a defamatory article published by the National Enquirer about actress Shirley Jones. 226 The Court found that the Enquirerreporters knew that Jones lived and worked in California and that she would be injured most in that state.227 As such, they should have "'anticipate[d] being haled into court there' to answer for the truth of the[ir] statements, ' 22 ' even though the information in the article was not actively "disseminated" by the Enquirer.2 9 The Court found that the "effects" of the defamatory article were felt most strongly in that state. 231 Similarly, in the context of a Web site, information does not flow directly to the recipient, but is posted and available for anyone to view. If a defamatory statement regarding a California resident is posted on a Web site based in New York, but the only person to view the

–  –  –

Web site lives in Florida, "it should make a significant difference to a court considering whether to assert jurisdiction over the Website owner."23 ' Regarding Web-based personal jurisdiction, a minority of courts have relied on Calder to focus on the location where the harm from actionable statements occurred.232 In CaliforniaSoftware, Inc. v. Reliability Research,Inc.,233 the federal district court for the Central District of California upheld personal jurisdiction over a Nevada software seller who disseminated defamatory messages about a California corporation by mail, telephone, and the Internet, in an effort to reach the corporation's national sales base.234 Citing Calder,the California District Court held that the resident plaintiff "felt the brunt of the harm from defendants' out-of-state acts in California."23 5 According to the court, the Internet postings would have been ' sufficient to assert personal jurisdiction, so long as the plaintiff could show that some prospective customers did in fact read the defamatory postings. 36 Calder's influence in Internet personal jurisdiction cases has been slight, as most analysis has centered instead on questions of purposeful availment.237 New Mexico, however, has left this question open-the Sublett opinion addresses neither of these potential approaches as the rule for this state.238 Therefore, it is questionable whether either the Calder "effects test" standard or the "purposeful availment" test would apply to a defamation case based upon Internet postings in this state.

2. Trademark Infringement Litigation In much the same way as with courts dealing with defamation and libel suits, courts have been split on the approach to dealing with trademark infringement over the Internet. The Ninth Circuit Court of Appeals rejected the Calder standard with regard to trademark infringement cases in Cybersell,Inc. v. Cybersell,Inc. 39 In that case, the court held that a Florida defendant company's contacts were insufficient to establish "purposeful availment" within the forum state of Arizona.24 ° The court declined to go further solely on the ground that the plaintiff Arizona company had alleged trademark infringement over the Internet by the defendant's "use of the registered name 'Cybersell' on an essentially passive web page advertisement."24 ' Otherwise, the court reasoned, "every complaint arising out of alleged trademark infringement on the Internet would automatically result in personal jurisdiction

231. Hernandez & May, supranote 84.

232. Charles N. Davis, PersonalJurisdictionin On-Line Expression Cases: Rejecting Minimum Contacts in Favor ofAffirmative Acts, Mar. 1999, at 6, available at http://www.bileta.ac.uk/pages/Conference%20Papers.aspx (last visited Mar. 25, 2005).

233. 631 F. Supp. 1356 (C.D. Ca. 1986).

234. Id. at 1357-58.

235. Id. at 1363.

236. Id. at 1363-64.

237. Davis, supra note 232, at 6.

238. The Sublett opinion does discuss the Caldereffects test with respect to defamation actions but makes no affirmative holding approving of that rationale with respect to Internet defamation actions. Sublett, 2004NMCA-089, 29, 94 P.3d at 852.

239. 130 F.3d 414 (9th Cir. 1997).

240. Id. at419-20.

241. Id. at 420.

PERSONAL JURISDICTION

Summer 2005] wherever the plaintiffs principal place of business is located. '2 2 As a matter of judicial economy and in deference to traditional notions of purposeful activity and invocation of the benefits and protections of the forum state, the Ninth Circuit rejected Calder with respect to Internet-based personal jurisdiction.243 Cybersell is illustrative of the choice-of-rule question regarding Internet-based personal jurisdiction and trademark infringement, in that the court analyzed the relative strengths and weaknesses of the "effects" and "purposeful availment" tests. 2 ' A number of courts have aligned themselves with Cybersell in adopting a purposeful availment test.24 5 As with defamation, however, in Sublett the New Mexico Court of Appeals did not address what kind of test it would apply, if any, to an action for trademark infringement over the Internet.



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