Legal side effects of Net jurisdiction

As with many aspects of Internet law, the underlying legal issue is not new, but courts continue to grapple with applying it to a new medium. In one of the most recent rulings on the issue known to lawyers and courts as "personal jurisdiction," a California court has said that a Texas resident who once lived in Indiana is subject to suit in California because his online activities had an effect there.

The decision was handed down by the Court of Appeal of the State of California on Aug. 7, 2001, nearly 20 months after the underlying lawsuit was filed and more than a year after the debate over personal jurisdiction began. (The judicial system, apparently, rarely moves at "Internet speed.") While the ultimate impact of the court's ruling is unclear, the immediate result should concern anyone whose actions on the Internet could lead to a lawsuit.

Personal jurisdiction refers to a court's power over an individual or business. A court has authority over only those parties who are within its reach, as defined by a long line of decisions involving the due process clause of the U.S. Constitution and numerous court pronouncements, including rulings by the Supreme Court.

The scope of personal jurisdiction is a complicated legal matter on which many lawyers and law professors have written extensively, so any attempt to summarize the issue here will not do it justice. But the general notion is this: A defendant in a lawsuit must be subject to the court's personal jurisdiction. This exists--in the words of a famous legal case--only if the defendant has sufficient "minimum contacts" with the jurisdiction to prevent a suit there from violating "traditional notions of fair play and substantial justice."

For example, if you live in Atlanta and visit a doctor there who injures you, there's little doubt that an Atlanta court will have personal jurisdiction over the doctor if you decide to file a malpractice suit against him there. But if you later move to St. Louis and file a lawsuit against the doctor there, the doctor surely will object that no St. Louis court has personal jurisdiction over him and he should not have to defend himself there.

That's an easy case. On the Internet, things aren't so straightforward.

In the recent California case, the issue revolved around the ongoing litigation over "DeCSS"--the controversial (and, perhaps, illegal) software that decrypts the content-scrambling system in DVDs that prevents them from being copied. One of the defendants sued by the DVD Copy Control Association (DVD CCA) for disseminating DeCSS is Matthew Pavlovich, a former engineering student at Purdue University who posted DeCSS on the Internet. The court has described Pavlovich as a leader in the open-source movement.

The California court's ruling on personal jurisdiction had nothing to do with the merits of the DVD CCA's claims that Pavlovich misappropriated its trade secrets and committed copyright infringement by posting DeCSS on the Internet. Rather, the issue was whether the California court had personal jurisdiction over Pavlovich, even though he was a student in Indiana when the lawsuit was filed and later moved to Texas. (A ruling on the merits of the case may come later.)

Interestingly, while the notion of personal jurisdiction on the Internet is still evolving, the California court said a 17-year-old U.S. Supreme Court case involving the National Enquirer provided "sufficient guidance" to enable it to find that it indeed has personal jurisdiction over Pavlovich. In the National Enquirer case, the court said that California had personal jurisdiction over a writer and the editor of the tabloid newspaper in a defamation suit brought by Shirley Jones, even though the writer and editor lived in Florida. The court said California "was the focal point of the story and of the harm suffered," and that jurisdiction over the Florida defendants was "proper in California based on the 'effects' of their Florida conduct in California."

Similarly, in the DeCSS case, the California court found that Pavlovich's actions (posting DeCSS on the Internet) had an effect on the movie and computing industry in California.

No "innocent intent"
"Pavlovich cannot claim innocent intent," the court wrote. "As a computer engineering student, a technician in the computer and telecommunications industry, a founder and president of a technology start-up company and a leader in the 'open source' movement, Pavlovich knew, or should have known, that by posting the misappropriated information on the Internet, he was making the information available to a wide range of Internet users and consumers throughout the Internet world, including users and consumers in California."

This ruling is just the latest in a number of Internet cases on personal jurisdiction. Many previous cases have focused on the extent of the defendant's contact with the jurisdiction and the nature of the defendant's Web site. An often-cited 1997 case, Zippo Manufacturing Co. v. Zippo Dot Com, indicated that "situations where a defendant has simply posted information on an Internet Web site which is accessible to users in foreign jurisdictions" would be insufficient for a court to exercise personal jurisdiction. The DeCSS case shows that the short history of Internet law is, in some cases, already being rewritten as novel issues arise.

The California court's decision signals an expansion of personal jurisdiction in cyberspace. If the ruling is followed by other judges, any Web publisher could be hauled into court wherever its site has an effect. And that might be an unintended but important legal side effect of publishing a Web site.