Lawsuits Sans Frontiers

• Personal Jurisdiction Meets the World Wide Web

Steven L. Baron

MM450

April 18, 2006

IIPA 2006 Report on China

• Piracy rates of physical copyright products remain virtually the highest in the world – 85 – 90%

• 35 million broadband lines

• 250,000 Internet Cafes

• Despite raids, no deterrence or meaningful decrease in availability of pirate products

Estimated Trade Loss*

*International Intellectual Property Alliance, 2006 Special 301 Report

Legal Issues that Emerge In International IP

• Who can be sued? Where? Under what law?

Important Definitions

• Jurisdiction = – Particular court or court system; and– Power of a court to hail a party into court and

render a decision that is binding on that party

Important Definitions

• Venue =– Location of a particular court

• Service of Process = – The delivery of legal papers that initiates a law

suit or legal proceeding

• Choice of Law =– The legal process of deciding which

jurisdiction’s law applies

Who Cares About Jurisdiction?

• Courts

• Lawyers

• Parties

Why care about jurisdiction?

• Impacts where you can be sued.

• Impacts law that applies to your suit.

• Impacts who decides the outcome.

• Impacts the nature of the outcome.

• Impacts the costs of suit.

• Impacts how you may decide to act in the future.

Dow Jones v. Gutnick

• Plaintiff/Respondent = Gutnick

• Defendant/Appellant = Dow Jones

Dow Jones v. Gutnick

• Gutnick lives in Victoria, Australia

• Dow Jones =– Delaware Company– Offices in New York City– Web Servers located in New Jersey

Dow Jones v. Gutnick

• Dow Jones publishes article in Barron’s On-Line

• Gutnick claims he was defamed in Australia

• Gutnick sues Dow Jones in Australia

Dow Jones v. Gutnick

• Trial court finds that Victoria “was not a clearly inappropriate forum” (i.e. Gutnick could maintain his suit in Australia).

• Court of Appeal refuses appeal.

• Dow Jones appeals to High Court of Australia

Dow Jones v. Gutnick

• High Court of Australia dismisses appeal– Defamation law seeks a balance

• Free Speech v. Preservation of Reputation

– Publication is “bilateral” in nature• Where the publisher acts

• Where the publication is presented

– Single Publication Rule

Dow Jones v. Gutnick

• “[T]hose who post information on the World Wide Web do so knowing that the information they make available is available to all and sundry without any geographic restriction.”

• Place where information is downloaded is where harm to reputation occurs.

Bangoura v. Washington Post

Those Pesky Canadians

Bangoura v. Washington Post

• Plaintiff = Bangoura– Former Senior official with UN– Seeks $9 million for two allegedly libelous

articles published on Post’s web-site

• Defendant = Washington Post – Washington based newspaper– Has on-line edition

Bangoura v. Washington Post

• At time of publication (1997), Post had 7 subscribers in Ontario

• The only individual to access the on-line articles was Bangoura’s counsel

• Bangoura did not move to Ontario until 2000

Bangoura v. Washington Post

• Post challenges jurisdiction in trial court.

• Trial court upholds jurisdiction:– “those who publish via the Internet are aware of

the global reach of their publications, and must consider the legal consequences in the jurisdiction of the subjects of their articles”

– Where is “publication”?– Where is the “effect” felt?

Bangoura v. Washington Post

• Court of Appeal (Ontario) reverses– Not reasonably foreseeable that Bangoura

would wind up a resident of Ontario– Bangoura’s lawyer was the only person in

Ontario to access the articles on the Washington Post Internet database

– U.S. Courts would not enforce a Canadian judgment (failure to meet “actual malice”)

– Gutnick case distinguishable

Why does the media care about where it can be sued?

Standards of Proof

• U.S. – Public figures must show “actual malice”– Knowledge of falsity or reckless disregard for

the truth

• U.K. – Public figures need not show “actual malice”

Gutnick and Bangoura

• Impact of Cases:– Gutnick opens up specter of suit anywhere that Internet

publication is available

– Bangoura tempers the Gutnick decision slightly

– Imposes upon web publishers the need to know the law in foreign jurisdictions

• What about all those poor bloggers?

– Collecting judgment may still be difficult against a foreign interest without assets in the country

Quote of the Day

• “Man's mind, stretched by a new idea, never goes back to its original dimensions.”

Oliver Wendell Holmes, Jr.