Because the interactions between individuals on the Internet may be separated by great distances, exactly where these interactions are taking place is creating problems for traditional notions of jurisdiction which are typically based on the location of individuals.
Patterson , a case of first impression for the U. Court of Appeals for the Sixth Circuit.
Compuserve, Inc. v. Cyber Promotions, Inc
Under the Patterson analysis, parties can be hauled into a foreign court for de minimis contacts with the forum state. Part V of this Comment offers a brief summary and concludes that under the facts of the Patterson case and as a general principal, minimum contacts should not be expanded to situations where the defendant can not reasonably anticipate being hauled into court in a foreign jurisdiction.
They are a consequence of territorial limitations on the power of the respective states. However minimal the burden of defending in a foreign tribunal, a defendant may not be called upon to do so unless he had the minimum contacts with that state that are a prerequisite to its exercise of power over him. A court must consider the burden on the defendant, the interest of the forum state, and the plaintiff's interest in obtaining relief.
It must also weigh in its determination "the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social policies. Under common law, trademark and trade name rights are appropriated only through actual prior use in commerce.
CompuServe consists of a computer information network which is navigated using special software. In addition, Patterson advertised and sold his product through that system, and the parties intended the relationship to be ongoing in nature. Rundzewicz 82 , the Court concluded that it was not unreasonable for a Burger King franchisee in Michigan to defend a lawsuit brought under the franchise agreement in Florida.
Although the Michigan franchisee had little physical contact with Florida, the Court noted that the franchisee entered into a year agreement with the Florida-based Burger King corporation which required substantial interaction between the Michigan franchisee and the Florida franchiser. The Court stated that merely entering into a contract without more, does not establish that a defendant had minimum contacts with a state.
However, the length of the relationship, the on-going dealings, and the parties interdependent relationship made the exercise of jurisdiction in Burger King reasonable.
Berkley Software Design The defendant, a California corporation, was subject to a lawsuit in New Jersey brought by a New Jersey corporation that claimed the defendant violated its property rights.
Furthermore, Patterson had little if any communication with CompuServe after the initial agreement 90 ; and did not depend on CompuServe to distribute his software because he was free to distribute his software anywhere he pleased.
Sprint Communications Co. Limited Partnership v. K's Foods, Inc. K's Foods , the court held that a foreign corporation "transacted business" in Ohio when it maintained distribution centers in Ohio and shipped goods to Ohio for ultimate sale.
K's Foods can be distinguished from Patterson on an important ground: 96 the dispute in Mr. K's Foods specifically arose from the contract between the plaintiff and defendant. K's distribution center in Ohio, Patterson's "distribution center" did not solely distribute products to Ohio customers.
Compuserve v patterson summary of the book
Mahasco Industries , and McGee v. International Life Insurance Co. Patterson , however, is distinguishable from Mahasco because Patterson did not contract with CompuServe for anything more than a place to store his goods. According to the court, Patterson's contacts with Ohio directly relate to the suit at hand.
CompuServe v. Patterson: The Limits of Personal Jurisdiction over Computer Networks
First, the court misconstrues the nature of common law trademarks and trade names. Furthermore, had Patterson's programs only been distributed in Ohio, it is likely that Patterson would have expanded the distribution of his program outside of Ohio, considering that his program runs on computers world-wide.
This "natural expansion" of distribution evokes the doctrine of the zone of natural expansion and would establish common law trademark and trade name protection at least in the United States and possibly internationally. The very nature of shareware is that it is free for anyone to distribute.
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Therefore, Patterson's infringement claim arises under the law of the many jurisdictions in which his shareware was used or may naturally be used, not simply Ohio. The plaintiff must show that the exercise of jurisdiction over the defendant would be reasonable, would comport with traditional notions of justice and fair play, and would be in line with the defendant's reasonable expectations about where he might have to defend his activities.
In considering the reasonableness requirements, the court stated that Patterson purposefully employed CompuServe to market his software. First, it is likely that Texas common law trademark and trade names is implicated in this case. Although the nature of the controversy between the parties in this case is different, the Court concludes that it is no more connected with purposeful activities within the State of Ohio than the standard customer dispute and that it would be manifestly unreasonable for this or any Ohio court to exercise jurisdiction over this case.
The district court as well as the Sixth circuit, however, applied a test of personal jurisdiction not well suited to cases arising from computer networks. Despite the mystery some commentators have chosen to mask over the Internet--those far-out claims of traveling around the world without leaving home--the contacts made over a computer network can only take place where there are users If a CompuServe user in California is browsing shareware program descriptions, the reading of the descriptions is taking place in California.
If the California user decides to copy the program, the copying is taking place in California.
Action takes place where the human beings are. Similarly, when Patterson uploaded software to CompuServe, the uploading took place in Texas. And more importantly, when users download Patterson's software, the downloading takes place where the users are. Once CompuServe puts a file in its shareware area it is the users who decide whether to download the file or to simply ignore it.
If a person in New York calls someone in California, the conversation is taking place both in New York and in California--not in the miles of fiber-optic wires that carry the signal; not at the many phone switching sites where the signal travels through. Patterson's program stored on CompuServe's network is like a tree falling in the forest without anyone around to hear it.
The Patterson Court says this tree makes a sound loud enough to warrant personal jurisdiction of Patterson in Ohio--it does not. The fact that Patterson's program was stored in Ohio does not amount to an activity within the state of Ohio. A company which conducts business on a world-wide computer network such as CompuServe, or the Internet, should not automatically be subject to jurisdiction in every court in the world.
The court should have applied the more rigorous test of "systematic and continuous" contacts to determine whether Patterson's activities met the requisite minimum contacts to subject him to personal jurisdiction in Ohio.
Patterson simply entered into two boiler-plate agreements with CompuServe and used the CompuServe system to passively store his software for users to download. Patterson incorrectly applied personal jurisdiction when all of the contacts with the forum state took place over a computer network. Although the number of computers connected to the Internet as "hosts" can be counted fairly accurately, it is impossible to count the number of users on each host.
See Internet 95 , Internet World , Nov. An Internet host is a computer connected directly to the Internet. Currently there are 4 million hosts in the United States and 6. The Internet is an array of networking capabilities that allow computers around the globe to share and distribute electronic data.
See Javed Mostafa et al. Packet-switching is a process where computers break down large amounts of data and send the it in small chunks or packets. The smaller packets move more quickly from computer to computer and avoid information traffic jams that would be caused by large unbroken streams of data.
Packet-switching protocols adopted by smaller networks as standards of communication have created a virtual, interactive overlay network. See, e. See generally Edward A.
Washington, U. Neff, 95 U. Amendment 14, sec. See Reynolds v. International Amateur Athletic Fed'n, 23 F.
Van Dusen Air, Inc. A long-arm statute permits the courts of a state to obtain jurisdiction over persons not physically present within the state at the time of service.
Long-arm statutes allow jurisdiction based on such factors as citizenship in the state, tortuous acts committed within the state, and in-state property ownership. See Reynolds , 23 F.
Lipton Dist. Dribeck Importers, Inc. Burnham v.
Superior Court, U. International Shoe , U. In personum jurisdiction is jurisdiction over the person whereas in rem jurisdiction is jurisdiction over the thing usually land which is the subject of the dispute. Black's Law Dictionary , 6th abr.
International Life Ins. Hanson v.
Denckla, U. Hall, U. Benguet Consol.
Mining Co. See World-Wide Volkswagen Corp. Woodson, U. See Asahi Metal Indus. See Burger King Corp. Rudzewicz, U. Asahi , U. Tally-Ho, Inc. Coast Community Col. A closed network does not share information with computers outside the network.
The Computer Chronicles - The Internet (1993)
In other words, once Patterson called his CompuServe local access number and hooked on to the CompuServe network, his transmissions would go directly from his computer to CompuServe's computer without ever traveling outside the network. This situation is unlike the Internet where transmissions between two computers have no set route and travel across many smaller networks before reaching their destinations.