Zippo Manufacturing Co. v. Zippo Dot Com, Inc.

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Zippo Manufacturing Co. v. Zippo Dot Com, Inc.
Pennsylvania-western.gif
Court United States District Court for the Western District of Pennsylvania
DecidedJan. 16, 1997
Citation(s)952 F. Supp. 1119
Holding
The Court denied Zippo Dot Com's motion to dismiss for lack of jurisdiction finding that its contacts with Pennsylvania residents and ISPs constituted purposeful availment of the privilege of conducting activities within the forum State.
Court membership
Judge(s) sitting Sean J. McLaughlin
Keywords
Personal Jurisdiction

Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997), was a decision by the United States District Court for the Western District of Pennsylvania that held that a court has personal jurisdiction over a website originating in a different territory, if the website is accessible to Internet users in the court's territory. The case is a landmark opinion regarding personal jurisdiction for courts deciding Internet-oriented disputes, and it is one of the most frequently cited Internet law precedents.

Contents

Background

Zippo Manufacturing Company, a Pennsylvania corporation, makes the well-known Zippo pocket lighters. Zippo.com was a California corporation that operated an Internet website that offered access to USENET newsgroups. [1] The Zippo.com company registered the domain names "zippo.com," "zippo.net" and "zipponews.com," [1] without regard for the prior use of that name by the lighter company.

Zippo Manufacturing filed a complaint in its own Pennsylvania district court against Zippo.com, alleging trademark dilution, trademark infringement, and false designation under the Lanham Act and state law trademark dilution statutes. [1] Zippo.com countered that the Pennsylvania court did not have personal jurisdiction over them because the company had no minimum contacts in Pennsylvania, and moved for the case to be dismissed. [2]

Zippo.com's contacts with any user in Pennsylvania occurred exclusively over the Internet, and its online content was as visible for all Internet users as it was for those in Pennsylvania. That company did not maintain any offices, employees or agents in Pennsylvania. [1] However, Zippo.com had approximately 140,000 paying subscribers worldwide, and about two percent (3,000) of those were Pennsylvania residents. [1] Zippo.com had entered into agreements with seven Internet access providers in Pennsylvania to permit their subscribers to access its USENET database, including two providers within the Western District of Pennsylvania. [1]

"Sliding Scale" test for Internet jurisdiction

The court established a three-prong test for determining whether a court has jurisdiction over a website, with a sliding scale of minimum contacts in a territory outside that of the site's origin. Under the sliding scale, "the likelihood that personal jurisdiction can be constitutionally exercised is directly proportionate to the nature and quality of the commercial activity that an entity conducts over the Internet." [2]

At the "strong" end of the scale is a defendant that clearly does business over the Internet, via a website that is visible for users in other territories, with contracts or other agreements in which "foreign" users consent to receiving the content and conducting business. At the "weak" end of the scale is a passive website that merely posts text with no opportunity for interactivity or business transactions. That type of website does not establish personal jurisdiction in other territories, but any website that does more and approaches the other end of the sliding scale has established enough contacts in the "foreign" territory to establish personal jurisdiction for that territory's courts. Thus, personal jurisdiction is more likely with an increase of interactivity at the website in question. [2]

Opinion

The Court stated that Zippo.com had established business contacts with enough subscribers in Pennsylvania to allow personal jurisdiction, so Pennsylvania courts could hold hearings and issue opinions in disputes concerning that website. [3] Thus, the District Court denied Zippo.com's motion to dismiss the suit, enabling a full trial for the manufacturing company's trademark claim. Zippo.com settled the case in December 1998, on confidential terms, before the trademark dispute could go to trial. [4] The "zippo.com" domain name and related domain names were returned to the ownership of the manufacturing company.

Impact

The "Sliding Scale" doctrine used in the Zippo ruling has played an important role in Internet jurisdiction. At least five federal appellate courts have expressly adopted the Zippo test. [5] [6] [7] [8] [9] However, some other courts have rejected that test, criticizing the matter of casual Internet usage by citizens as a factor in determining jurisdiction. [10]

The Zippo case has been cited as a crucial early precedent in Internet law, establishing that a court has personal jurisdiction over a website and its owners if any person within the court's geographic territory has access to that site. Given the fact that most websites are equally accessible to all users of the World Wide Web, the Zippo case has had a wide impact on the ability of American citizens to initiate suits against website creators. [11]

See also

Related Research Articles

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<i>Cybersell, Inc. v. Cybersell, Inc.</i>

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<i>Bensusan Restaurant Corp. v. King</i> American legal case

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<i>Toys "R" Us, Inc. v. Step Two, S.A</i> U.S. court case

Toys "R" Us, Inc. v. Step Two, S.A was a case in the United States Court of Appeals for the Third Circuit which set precedent in this circuit for its application of the "Zippo" test in determining the validity of a claim to personal jurisdiction based on the interactivity of a website. This case was presented as an appeal to a ruling from the District Court which denied Toys "R" Us' request for jurisdictional discovery and dismissed the case over lack of personal jurisdiction. The appellate court held that the denial of jurisdictional discovery was in error, and remanded the case to be reconsidered once this discovery took place.

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<i>CompuServe, Inc. v. Patterson</i>

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<i>Illinois v. Hemi Group LLC</i> 2010 personal jurisdiction case

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<i>Boschetto v. Hansing</i> Diversity jurisdiction case

Boschetto v. Hansing, 539 F.3d 1011 is a diversity jurisdiction case brought by California resident, Paul Boschetto ("Boschetto") against certain private corporations with their principal place of business in Wisconsin. The case involved the determination of the question whether the sale of an item via the internet consumer-to-consumer trading portal, eBay, by the defendants in Wisconsin to the plaintiff in California, was sufficient to confer personal jurisdiction over a non-resident defendant in the buyer's forum state. At the first instance, the United States District Court for the Northern District of California decided against Boschetto and held that a lone “eBay sale consummated with a California purchaser, was insufficient to establish jurisdiction over any of the defendants.” Boschetto appealed against the decision to the United States Court of Appeals for the Ninth Circuit. The appellate court affirmed the decision of the district court and denied relief to Boschetto. The Court became the first federal appellate court to address whether personal jurisdiction in a forum state could be established when an out-of-state resident makes use of an intermediary website accessible by forum-state citizens.

<i>Hearst Corp. v. Goldberger</i>

Hearst Corp. v. Goldberger was a case out of the U.S. District Court for the Southern District of New York in which the court developed a reasoned framework to determine the proper exercise of personal jurisdiction in cases involving activity in cyberspace. The court determined that it lacked jurisdiction over an out-of-state defendant whose website was accessible to New York residents.

<i>Maritz, Inc. v. Cybergold, Inc.</i>

Maritz, Inc. v. Cybergold, Inc., 947 F. Supp. 1328, was a personal jurisdiction case in which the United States District Court for the Eastern District of Missouri ruled that operator of website, for which server was located in California, was subject to personal jurisdiction in Missouri under "commission of a tortious act" provision of Missouri's long-arm statute, §506.500 RSMo. The case was brought before the court by Marits, Inc. alleging that the Cybergold's use of mark for advertising internet site was a trademark infringement. Cybergold moved to dismiss the suit for lack of personal jurisdiction, but the court found that the operational nature of the Internet based service provided a connection for Cybergold to be sued in Missouri.

<i>Cable News Network L.P. v. CNNews.com</i>

Cable News Network L.P. v. CNNews.com, 162 F.Supp.2d 484 (2001), was a trademark law case of the United States District Court for the Eastern District of Virginia, over the use of a registered trademark owned by an American company in the web address of a foreign company. The court ruled that a foreign firm's use of an American trademark in a web address could be a violation of the Anticybersquatting Consumer Protection Act, but such a violation requires a show of bad faith.

<i>Blumenthal v. Drudge</i>

Blumenthal v. Drudge, 992 F.Supp. 44, was a case of the United States District Court for the District of Columbia, over online defamation and whether an Internet service provider has legal liability for defamatory comments made by its users. The ruling became an early precedent upholding the legal protections enjoyed by online businesses as provided by Section 230 of the Communications Decency Act, though it raised unresolved questions about the legal responsibilities of online journalism.

References

  1. 1 2 3 4 5 6 Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119, 1121 (W.D. Pa. 1997).
  2. 1 2 3 Id. at 1124.
  3. ↑ Id. at 1126.
  4. ↑ California Secretary of State Debra Bowen, Results Detail for Zippo Dot Com (visited Nov. 20, 2009) <https://businessfilings.sos.ca.gov>, and PACER Service Center, Case Summary for Zippo Manufacturing v. Zippo Dot Com, Inc. (visited Nov. 5, 2009) <https://ecf.pawd.uscourts.gov>
  5. ↑ Toys "R" Us, Inc. v. Step Two, S.A , 318 F.3d 446 Archived July 21, 2011, at the Wayback Machine (3rd Cir. 2003).
  6. ↑ ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707 Archived July 21, 2011, at the Wayback Machine (4th Cir. 2002).
  7. ↑ Mink v. AAAA Dev. LLC, 190 F.3d 333 (5th Cir. 1999).
  8. ↑ Cybersell, Inc. v. Cybersell, Inc. , 130 F.3d 414 Archived July 21, 2011, at the Wayback Machine (9th Cir. 1997).
  9. ↑ Soma Med. Int'l v. Std. Chtd. Bank, 196 F.3d 1292 Archived July 21, 2011, at the Wayback Machine (10th Cir. 1999).
  10. ↑ Hy Cite Corp. v. Badbusinessbureau.com, 297 F. Supp. 2d 1154, 1160 (W.D. Wis. 2004); Howard v. Mo. Bone & Joint Ctr., Inc., 373 Ill. App, 3d 738, 743 (2007).
  11. ↑ Dutta, Anindita (1998). "Zippo Manufacturing Co. v. Zippo Dot Com, Inc". Berkeley Technology Law Journal. 13 (1): 289–303.
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