Brief Fact Summary.
Badbusinessburea.com moved to dismiss a suit by Hy Cite Corp. due to lack of personal jurisdiction.
Synopsis of Rule of Law.
A state may not exercise personal jurisdiction over a business with an interactive website if the company has no other contacts within the state.
In a diversity jurisdiction case, a federal district court only has personal jurisdiction over a particular defendant if a court of the state in which it sits would have such jurisdiction.View Full Point of Law
Hy Cite Corp. (Hy), a Wisconsin company, sued Badbusinessbureau.com (BBB) in Wisconsin for trademark infringement, false advertisement, and other claims. BBB is a West Indies company that does not have offices, own property, or have business in Wisconsin. BBB has one book sale in Wisconsin and BBB moved to dismiss the claim for lack of personal jurisdiction.
Whether a state may exercise personal jurisdiction over a business with an interactive website if the company has no other contacts within the state?
No. The motion to dismiss for lack of personal jurisdiction is granted. A book sale is the state is not enough to establish contacts there where the claim does not arise out of the book sale. Hy did not show that BBB availed itself of doing business in Wisconsin or the results of their actions were felt in Wisconsin.
The Zippo three-prong test establishes that interactive websites where defendants conduct business and elicit sales are enough to grant personal jurisdiction; passive websites that afford internet users no interactivity are not enough to grant personal jurisdiction; and interactive websites where a user can exchange information with the host computer may be sufficient to find personal jurisdiction.