E-mail tests jurisdictional jurisprudence

“[S]omewhat like trying to board a moving bus.”

—Burger King Restaurant Corp. v. King, 126 F.3d 25, 27 (2nd Cir. 1997)(describing the challenge of adjudicating Internet jurisdictional issues).

Courts have grappled with the issue of assertion of personal jurisdiction over extraterritorial defendants for a long time. See Harris v. Balk, 198 U.S. 215 (1905). Although age-old, the issues still continue to rise, often in new circumstances in today’s high-tech society.

The Minnesota Court of Appeals recently addressed the time-honored jurisdictional issue in the context of the modernity of e-mail, holding that Minnesota courts do not have personal jurisdiction over an out-of-state defendant who transmits defamatory material into Minnesota by that mode of communication. In Northwest Airlines, Inc. v. Friday, 2000 WL 1376531 (Minn. App. Sept. 26, 2000), the court held that the Minnesota long-arm statute, Minn. Stat. sec. 543.19, does not permit the imposition by courts of this state of personal jurisdiction over a defendant outside the state who defames a Minnesota resident in this state through e-mail.

The case illuminates the jurisprudential crosscurrents of personal jurisdiction in high-tech communications.

E-mail exception

E-mail empowers individuals to disseminate communications widely — whether wisely or not. The process also has created its own cottage industry of litigation.

The phenomena found its way to Minnesota, but did not survive here long. In the Friday case, the wife of a pilot for Northwest Airlines, who was deemed unfit for duty, sent out a press release by e-mail from Washington, where she lived. The press release reiterated many of the allegations made in a lawsuit they brought against the airline for a variety of claims. The e-mail was addressed to individuals throughout the country, including some in Minnesota. The airline sued, claiming defamation and business disparagement.

The e-mailer moved to dismiss the case on grounds of lack of personal jurisdiction, noting that she owned no property, transacted no business and had no ongoing presence in Minnesota, only having been in the state once in the past few years simply to change airplanes. The Dakota County District Court dismissed the lawsuit on grounds of lack of personal jurisdiction over the Washington woman.

The Court of Appeals affirmed. It noted that the state generally follows federal law with respect to personal jurisdiction issues, but that this case presented “an exception to the general rule” because of a “little-used provision” in the Minnesota long-arm statute, Minn. Stat. sec. 543.19(d)(3). The statute prohibits assertion of personal jurisdiction in Minnesota for any “act outside Minnesota” if the claim is for “defamation of privacy.” Therefore, the issue was whether sending e-mails to Minnesota recipients constitutes an “act outside Minnesota,” which would preclude jurisdiction, or an act within the state, for which jurisdiction exists.

In a prior case, the court stated that sending mail to Minnesota from outside the state or making telephone calls to Minnesota from another state are deemed to be acts occurring “outside Minnesota” and, therefore, do not subject the communicator to personal jurisdiction of the state. See Wheeler v. Tufel, 443 N.W.2d 555 (Minn. Ct. App. 1989). Thus, in Friday, since the woman’s action consisted of “sending allegedly defamatory e-mail press releases … [when] she was in Washington,” not Minnesota, her acts occurred “outside” Minnesota and, therefore, invoked the exception to the assertion of long-arm jurisdiction.

The court rejected the airline’s contention that “the phenomenon and power” of the Internet warrants a different result than analogous situations of e-mail or telephone calls. The court observed that the legislature “obviously did not have the Internet in mind when it drafted long-arm statutes,” and suggested that it may “wish to reconsider the statute” in light of the Internet. But the possibility of future legislative change is not determinative of this case, which required dismissal as “the result of a straightforward” analysis of the long-arm statute and applicable caselaw. The court also rejected Northwest’s claim for business disparagement, in that the tort only arises when the contact at issue occurs “in the course of trader business,” which did not happen in this instance.

Conflicting cases

The Friday case seems to conflict with evolving case law concerning jurisdiction over the Internet and other contemporary technological devices.

Jurisdiction over e-mail, Internet, and other forms of high technology raise challenging issues. However, the underlying concern dates back to the development of standards for assertion of judicial power over parties outside the territorial confines of a jurisdiction. That principle developed over the years into a requirement that a party outside the state have “minimum contacts” within the jurisdiction for a tribunal in that forum to be entitled to exercise jurisdiction over the foreign party.

The “minimum contacts” standard led to the broadening of jurisdiction through long-arm statutes, which extend jurisdiction over out-of-state parties. Minnesota has a pair of them — the general long-arm statute for torts, Minn. Stat. sec. 543.19, which was invoked in the Friday case, and a special provision, Minn. Stat. sec. 303.13, applicable to contracts entered into or to be performed in Minnesota. Both measures are intended to extend jurisdiction of Minnesota courts to the maximum extent permissible consistent with due process. Harddrives, Inc. v. City of LaCrosse, 307 Minn. 290, 240 N.W.2d 814 (1976).

Application of these traditional tenets to the Internet has been troublesome. The penetration of the Internet in all jurisdictions theoretically could subject users of the medium to jurisdiction everywhere. At the other extreme, a party could contend that the transcendental presence on the Internet means that a party has no physical presence anywhere and, thus, is outside the scope of any jurisdiction.

One judge, evoking Gertrude Stein’s observation about Oakland that “there is no there there,” observed the difficulty of imposing jurisdictional requirements on commerce and communication on the Internet. The judge wrote, “not only is there perhaps no ‘there,’ the there is everywhere where there is Internet access.” Digital Equipment Co. v. Alta Vista Technology, Inc., 960 F. Supp. 456 (D. Mass. 1997). Equally perplexed, another court lamented that adjudicating Internet jurisdictional issues “is somewhat is like trying to board a moving bus.” Burger King Restaurant Corp. v. King, 126 F.3d 25 (2nd Cir. 1997).

Evolving caselaw around the country generally, but not exclusively, has upheld Internet jurisdiction in the forum state. Many different theories have been utilized, including the concept of “targeting,” which has been invoked when the subject of the communication has presence in the forum jurisdiction, as well as the notion of “purposeful” intrusion into the foreign state by Internet users.

The varied aspects of the Internet highway have not bypassed Minnesota. Prior to Friday, administrative decisions, caselaw, and even settlements in this state have addressed the jurisdictional issues that arise fro
m Internet use.

In State v. Granite Gate Resorts, 568 N.W.2d 175 (Minn. 1997) (aff’d without opinion) (Minn. May 14, 1998), jurisdiction in Minnesota was upheld over an offshore gambling operation whose Internet overtures to Minnesotans clashed with Minnesota’s legal prohibition against gambling. The Court of Appeals confronted, and rejected, the arguments by the gambling concern that exposing it to jurisdiction in Minnesota would unfairly make it subject to the vagaries of laws throughout the world. The court extended Minnesota’s jurisdiction over the offshore Internet operation because the gambling operators had, through its Internet transmission into this state, “purposefully availed themselves of the privilege of doing business in Minnesota.”

The ruling of Granite Gate drew upon an earlier warning of the Minnesota Attorney General’s Office. Several years ago, the Attorney General’s Office posted on the Web a “Warning to all Internet Users and Providers.” The admonition states that “persons outside of Minnesota who transmit information via the Internet knowing that information will be disseminated in Minnesota are subject to jurisdiction in Minnesota courts for violation of state, criminal, and civil laws.”

Minnesota has flirted with international jurisprudence on the Internet. In a case that may pave the way for developing an international law of the Internet, the University of Minnesota recently settled a libel case arising out of Internet use on campus that landed in a British courtroom. In Godfrey v. University of Minnesota, 1997 G#1187, a British physicist sued the University and a former student for allegedly libelous statements made about him by a former student on a Usenet Newsgroup, an unregulated online forum similar to a “chat room.” The physicist, who had previously settled claims involving Internet services in Austria and Great Britain, contended that the university was responsible for the libel because the student was using a university account to make the offending comments. The university sought to challenge jurisdiction by the English court, but it settled the case earlier this year, issuing an apology to the physicist, who obtained a default judgment against the student.

The settlement prevented an attempt to reconcile two conflicting international laws. Britain’s 1996 Defamation Act makes Internet service providers responsible for anything posted on their Web sites or news groups. But the Federal Telecommunications Act, also enacted in 1996, protects Internet providers in the United States from culpability for information posted on their sites. Determining which law should be applied is an issue that, like many others involving the Internet, will have to be decided at a later time.

The Friday case represents a more restrictive view of the source of personal jurisdiction over the Internet than these other cases. The growing use of e-mail and other technological devices continues to test the jurisprudence of personal jurisdiction in Minnesota law. As the Internet and e-mail become even more prevalent, the Friday case probably is far from the last word on the subject.

Marshall H. Tanick is an attorney with the Twin Cities law firm of Mansfield, Tanick & Cohen, P.A. He is certified as a civil trial specialist by the Minnesota State Bar Association and represents employers and employees in a variety of workplace-related matters.