Personal Jurisdiction in Cyberspace: Nature of Plaintiff's Claim

Jay Kesan
University of Illinois at Urbana-Champaign, College of Law

TABLE OF CONTENTS

  1. Brief Summary of Personal Jurisdiction Law
  2. Interactive Web Sites and Persistent Contacts
  3. Passive Web Sites
  4. Nature of Defendant's Activity
  5. Nature of Plaintiff's Claim
  6. Suggested Class Room Discussion Topic

E. Nature of Plaintiff's Claim


BLAKEY v. CONTINENTAL AIRLINES, INC.
Superior Court of New Jersey, Appellate Division. 1999
1999 WL 402897 (N.J.Super.A.D.)

Cuff, Judge:


In this appeal, we review the propriety of the dismissal of plaintiff's defamation, sexual harassment, business libel, and emotional distress claims against plaintiff's employer and certain co-employees. All of the claims arise from a series of allegedly defamatory remarks published on a computer bulletin board accessible only by employees through personal computers. The claims against the individual employees were dismissed on the basis of lack of personal jurisdiction. * * * We affirm.

Plaintiff Tammy S. Blakey is a pilot for defendant Continental Airlines, Inc. (Continental) and has been employed by Continental since 1984. In January 1990, plaintiff became the first woman captain of Continental's Airbus A300 aircraft. She resides in Seattle, Washington, and was based at Continental's Newark hub from 1990 to 1993. Since 1993, she has been based at Continental's Houston hub.

On February 5, 1993, plaintiff filed a complaint against Continental in the United States District Court for the Western District of Washington, seeking injunctive relief enjoining Continental from maintaining a hostile work environment and directing it to investigate the persons responsible for subjecting plaintiff to sexually explicit photographs, cartoons, and abusive comments. Also in 1993, plaintiff filed a complaint in the same court against Continental alleging harassment and discrimination under 42 U.S.C.A. 2000e and the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to - 42. By order dated May 13, 1993, the actions were transferred to the United States District Court for the District of New Jersey. Following a five week trial, a jury found Continental liable for sexual harassment and awarded plaintiff $875,000.

On September 25, 1995, well before trial, plaintiff moved to amend her federal complaint to include a cause of action for defamation against seven of her co- workers based on statements made by them about her after she filed her federal complaint. She also sought to hold Continental vicariously liable for the allegedly defamatory remarks of her co-employees. In denying this relief, a federal magistrate observed that plaintiff had other forums available to pursue these subsequent claims.

Soon thereafter, plaintiff filed a complaint in the Superior Court which alleged that defendants Kaye V. Riggs, Joe Vacca, Steve Abdu, Mark J. Farrow, Don Jensen, Dave Orozco, and Thomas N. Stivala published allegedly defamatory statements on Continental's Crew Management System (CMS), that Continental was liable for a hostile work environment arising from the allegedly defamatory statements, that Continental had participated in business libel on the basis of its operation of the CMS, and that Continental and the individual defendants intentionally inflicted emotional distress on plaintiff. All individual defendants but Jensen and Abdu filed a motion to dismiss the complaint for lack of personal jurisdiction. By order dated April 3, 1997, Judge Julio Fuentes granted this motion. On July 28, 1997, a consent order was filed dismissing the complaint against defendant Jensen, another non-resident pilot.


* * *


On appeal, plaintiff argues that Judge Fuentes erred in dismissing the individual defendants for lack of personal jurisdiction. She asserts that each individual non-resident defendant has sufficient minimum contacts with New Jersey to subject each of them to personal jurisdiction in this state. She further contends that this court has personal jurisdiction of each defendant because the alleged defamatory statements were published in this state.


* * *

[FACTS]

Continental's computerized CMS provides information on flights, information on crew member schedules, information on pay, and information on pairings. According to Anna White, Continental's Director of Crew Systems and Planning, the CMS was used by "[c]rew members, our pilots and flight attendants, and then also Continental Airlines scheduling staff, [and] pay staff." The information provided on the CMS was "necessary for crew members to perform their jobs at Continental" and included "a copy of their schedules and their ongoing activities." According to White, Continental required crew members to access that information.

Continental provided several different ways for flight crew members to access the CMS. First, in "crew base locations" in Houston, Cleveland, Newark, Los Angeles, Honolulu and Guam, it provided "dum[b] terminals" with direct lines accessing the mainframe computer. In addition, some terminals in various airport locations interfaced another system that also could be used to access the CMS. Second, a voice response system with "800" and local numbers provided access to some functions. Third, the system could be accessed remotely by personal computers through CompuServe. This third method of access was optional for crew members.

Continental negotiated a contract with CompuServe in which CompuServe was a service provider for Continental for a variety of functions including a connection to Continental's mainframe systems to provide crew members access to the CMS and to reservations. Accessing the CMS through CompuServe required a personal computer (PC), modem and phone line. Crew members would contact CompuServe, identify themselves as a Continental Airlines crew member, and they would be sent a membership kit. White explained, "[t]he membership kit contains software that's been specialized for Continental. And they would load that software on their PC." Continental did not require its pilots or flight attendants to become members of CompuServe and did not provide its crew members with PCs for that purpose.

To reach the actual CMS location, a user logs onto CompuServe and inputs the command "go Continental." The command then would bring up a Continental menu of six different activities, one of which was "crew member access." By clicking on "crew member access," the user would receive a list of six or seven items, one of which was "Access Continental Crew Management System." Upon selecting that option, the crew member was connected to CompuServe, which would then pass that user over through lines to the Continental system, the Continental mainframes, and then the user would access the CMS the same way as from a dumb terminal at a crew location. The user would input his/her password and Continental "ID" and continue to navigate through the system.

The Forum was an area available in CompuServe for crew members to exchange information and opinions and served as a computer bulletin board. Crew members who utilized the CMS were not required to access the Forum. While access to the Forum did not require input of a password identifying the user as a crew member, the user was required to provide a Continental crew member identification to receive the software necessary to access the system, and the software itself was encrypted so that its use was restricted to pilots and flight attendants.

Members of Continental's management were not permitted to post messages or to respond to messages on the Forum. However, chief pilots and assistant chief pilots, who were considered to be management within Continental, had access to the Forum. No department at Continental was responsible for monitoring the Forum or reviewing the messages it contained.

Problems accessing the Forum were to be directed to CompuServe; Continental employees would be unable to provide assistance. But, once the user had accessed the Forum, technical support and general troubleshooting assistance for Forum users was provided by Continental pilots and flight attendants who volunteered for the position of systems operators, known as SYSOPS. SYSOPS were not paid by either CompuServe or Continental.

Continental paid no money to CompuServe in relation to the Forum. CompuServe, however, paid Continental 3 percent of the $5.80 per hour fee it charged to provide direct connection between CompuServe and the Continental mainframe.

CompuServe charged its members $9.95 for basic service that included five hours of access time, with a charge of $2.95 per hour for any additional hours. In addition, White testified that "if there are any direct connect charges between CompuServe and Continental Airlines' mainframes there's a $5.80 an hour connection fee for that." Those fees were imposed by CompuServe and Continental sent no bills to its crew members for use of the CMS.

The information contained within the CMS was located in Continental's mainframe computer, physically located at Electronic Data Systems (EDS) in Charlotte, North Carolina, and was not maintained in a CompuServe mainframe. Continental had out-sourced most of its technology department to EDS to avoid having internal programmers, project management and in-house computers. EDS has been characterized as a service provider for Continental. Continental maintained contracts with EDS and CompuServe, and Continental retained the ability to negotiate for any contractual terms it deemed fit and appropriate.

Continental gave CompuServe permission to come to its pilots' lounges, and provide leaflets and membership kits to encourage its pilots and flight attendants to join CompuServe. Continental also gave CompuServe permission to use the Continental name. Continental could withdraw its permission only when the contract between it and CompuServe was completed.

Upon joining the Forum, a disclaimer warned of the need to use appropriate language, avoid profanity, and abide by the rules of CompuServe. SYSOPS were responsible for enforcing compliance with these conditions.

Beginning in 1995, and while plaintiff's federal lawsuit was pending in New Jersey, a series of communications, referred to as "threads," were published on the Forum. Specifically, on July 14, 1995, First Officer Kaye V. Riggs wrote that plaintiff "doesn't really belong [with Continental] anyway, at least to my mind.... I believe [plaintiff's] lawsuit is bogus, the charges patently false, and that she is out to get a quick buck. Why don't you ask her about the training she was given, far in excess of the syl[l]abus, just to be able to pass her PC's?" On July 16, 1995, Riggs wrote to plaintiff via the Forum that he had heard she "crashed [her] floatplane" and asked "is this a damned lie, too?" On July 17, 1995, a thread was published asking plaintiff: "What about the engine(s) on the A-300 you burned up by overtemping?" The thread identifies the author as Riggs. On July 23, 1995, referring to plaintiff, Riggs wrote: "EVERY MEMBER OF THIS FORUM SHOULD BE AWARE THAT CERTAIN INDIVIDUALS WILL ATTEMPT TO CAUSE HARM TO OTHERS THEY DISLIKE."

Meanwhile, on July 21, pilot Joe Vacca posted a thread to Blakey stating that she "need[ed] to prey on a legal system that does not stand up to people who are vexatious and try to get even for their lack of interpersonal skills." On July 25, 1995, Vacca sent a thread to Nancy Novaes, presumably another pilot, referring to her and plaintiff as "feminazis." He also posted a thread stating: "I am curious if Ms. Blakey will reimburse CAL for the: 1) Engine she overtemped and destroyed. 2) The $250,000 in hail damage done when she flew through the TRW, with the F/O trying to tell her not to go through the WX, etc. etc." He also made similar statements in a thread dated July 15.

[The court continues to provide statements made by other defendants]


* * *


I


We will address the personal jurisdiction issue first. In that regard we note certain undisputed facts regarding the individual defendant's residency and work stations.

At the time the threads were posted on the Forum, the only pilot who resided in New Jersey was defendant Steve Abdu. Defendant Mark Farrow lived in both Colorado and Texas; his employment base was Texas. As a union representative, he visited Newark once after the complaint was filed. Defendants Dave Orozco and Tom Stivala resided in Texas; their employment base was also Texas. Defendant Kaye Riggs resided in California and Texas; he was based in California and Texas. Joe Vacca resided in Colorado; his employment was based in Colorado and Texas. Furthermore, at the time the threads were posted, plaintiff neither resided nor was based in Newark. Plaintiff had been based in Newark from 1990 to 1993; she has never resided in New Jersey.

In his opinion, Judge Fuentes concluded that the court lacked general jurisdiction of the individual defendants. After canvassing the developing law concerning claims arising from allegedly defamatory electronic mail messages, he concluded that specific personal jurisdiction may be asserted over a non- resident defendant solely on the basis of their electronic contacts "only when they specifically direct their activities at the forum, the plaintiff is a resident of the forum, and the brunt of the injury is felt in the forum state." He noted that this comports with existing authority on the issue of personal jurisdiction.

Then, applying these principles to the jurisdictional facts, Judge Fuentes found that this state lacked personal jurisdiction of the individual defendants. He concluded that the individual defendants

did not engage in any activities by which they purposefully availed themselves of the privilege of conducting any business in New Jersey, and thereby did not invoke the benefits and protection of its laws. There is also no evidence that the defendants purposefully directed their allegedly defamatory statements at [New Jersey].

We agree.


New Jersey permits the exercise of personal jurisdiction over non- resident defendants to the extent "consistent with due process of law." R. 4:4- 4(b)(1);. * * * Thus, the test for personal jurisdiction has two facets: "minimum contacts" and "fair play and substantial justice."

* * * Plaintiff asserts defendants' activities establish specific jurisdiction over them.

The minimum contacts evaluation is conducted on a case-by-case basis. A critical portion of the inquiry focuses on the purposefulness of a defendant's contacts with the forum state, ensuring that a defendant "will not be haled into a jurisdiction solely as a result of 'random,' 'fortuitous,' or 'attenuated' contacts." But, "[a]n intentional act calculated to create an actionable event in a forum state will give that state jurisdiction over the actor." Waste Management, Inc. v. Admiral Ins. Co., 138 N.J. 106, 126, 649 A.2d 379 (1994) (citing Calder v. Jones, 465 U.S. 783, 791, 104 S.Ct. 1482, 1488, 79 L.Ed.2d 804, 813 (1984).

If minimum contacts have been established, the court must then evaluate the fairness of requiring a defendant to defend the lawsuit in the plaintiff's chosen jurisdiction. The relevant factors in that analysis are:

(1) the burden on the defendant; (2) the interests of the forum state; (3) the plaintiff's interest in obtaining relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several states in furthering fundamental substantive social policies.

Plaintiff finds support for her position in cases where the courts have found personal jurisdiction in a particular forum based on the publication in the forum state of newspapers and magazines containing the allegedly defamatory remarks. Defamatory communications transmitted on the Internet and published in print media share the common characteristic of the dissemination of false and damaging information. Therefore, we initially focus our attention on the print media defamation cases.

In Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 773, 104 S.Ct. 1473, 1478, 79 L.Ed.2d 790, 796-97 (1984), the United States Supreme Court found the existence of personal jurisdiction solely on the basis that the magazine containing the allegedly libelous statements regularly circulated within the forum state. The plaintiff was not a resident of the forum state, and her only connection with the forum was the circulation there of a magazine she assisted in producing.

The Court first found that the regular circulation in the forum of thousands of copies of the defendant's magazines could not "by any stretch of the imagination be characterized as random, isolated or fortuitous." The Court then examined the relationship between the defendant, the forum and the litigation, focusing on the forum's interest in asserting jurisdiction in light of the fact that the plaintiff was seeking to recover in that suit damages for injuries suffered in all states.

* * *

Thus, the mere fact that a plaintiff is a non-resident of the forum state is insufficient to defeat a finding of personal jurisdiction established by the defendant's contacts. Nor is jurisdiction defeated merely because the bulk of the harm occurred outside the forum. That circumstance "will be true in almost every libel action brought somewhere other than the plaintiff's domicile." 465 U.S. at 780, 104 S.Ct. at 1481.

* * *

In Calder the Court's analysis emphasized that the individual non-resident defendants purposely directed their activities against a California resident and that the damaging effects of their writing were felt by a person whose private and professional life was centered in California. Calder v. Jones, 465 U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984)

The Third Circuit explained that the Supreme Court's conclusions in Calder relied on the following findings:

First, the defendant committed an intentional tort. Second, the forum was the focal point of the harm suffered by the plaintiff as a result of that tort. Third, the forum was the focal point of the tortious activity in the sense that the tort was "expressly aimed" at the forum. Essential was a corollary finding that the defendants knew that the "brunt" of the injury caused by their tortious acts would be felt by the plaintiff in the forum. IMO Indus., Inc. v. Kiekert AG, 155 F.3d 254, 261 (3d Cir.1998).

Subsequent courts have characterized the Calder analysis as the " 'effects' test." * * *

Both the Keeton and Calder cases concerned allegedly defamatory statements published in print magazines and, to some extent, the outcome in each at least implicitly relied on the deliberate physical distribution within the forum state of the magazine itself. The case before this court, however, involves electronically transmitted communications. While Internet communications share some of the same features as print and television communications, some features such as the virtually limitless accessibility of many Internet connections renders this communication medium unique.

Internet cases involving "on-line" injuries, such as intellectual property infringement, defamation, and breach of contract have proliferated as the popularity of the Internet for communications and commerce has expanded. At this stage in the development of the Internet, a primary emerging issue is the exercise of personal jurisdiction over non-resident defendants.

* * *


We, like Judge Fuentes, have canvassed the law on the issue of personal jurisdiction of defamation claims based on electronic communications. We concur with Judge Fuentes' synthesis of the current state of the law:

The common thread that runs through each of the reported decisions is that non-resident defendants may be subject to personal jurisdiction solely on the basis of their electronic contacts only when they specifically direct their activities at the forum, the plaintiff is a resident of the forum, and the brunt of the injury is felt in the forum state.

Stated differently, we, like Judge Fuentes, have located no case in which a court has found personal jurisdiction over a non-resident defendant for allegedly defamatory remarks communicated electronically when the plaintiff did not reside in the forum state, plaintiff's employment was not based in the forum state, and defendant's electronically transmitted remarks were not specifically targeted at the forum state. Indeed, to do so would go beyond the outer limits of due process.

Our research has revealed only two cases in which a court has declined jurisdiction of a non-resident individual or corporate defendant which has used the Internet, e-mail, and computer bulletin boards or forums to make defamatory statements. However, in each case in which jurisdiction has been asserted over non-resident defendants the defamatory communication was specifically targeted at the state in which the plaintiff resided or conducted business activities.

[The court next discusses how CompuServe v. Patterson, 89 F.3d 1257 (6th Cir.1996) and Blumenthal v. Drudge, 992 F.Supp. 44 (D.D.C. 1998) supports the conclusion that jurisdiction is proper when the defamatory communication is targeted at the state where the plaintiff resides or conducts business.]

* * *

[The court now discusses cases in which a court has declined jurisdiction over an non-resident defendant, National Petroleum Mktg., Inc. v. Phoenix Fuel Co., 902 F.Supp. 1459 (D.Utah 1995) and Barrett v. Catacomb Press, 44 F.Supp.2d 717 (E.D.Pa 1999)]

* * * However, the circumstances of each case [National Petroleum and Barrett] support the conclusion that the exercise of personal jurisdiction over the non-resident individuals in this case exceeds the outer limits of due process.

In National Petroleum Mktg., plaintiff was a Nevada corporation involved in refining, buying and selling petroleum products, with its principal place of business in Utah. The defendants were a rival Arizona corporation and its chief officers, and a Maryland company that provided specialized oil industry information, its officers, editors, and news reporter. No individual defendant was a Utah resident and none of the defendants owned property or conducted any business in Utah.

The alleged defamatory statements were contained in an article published by the Maryland company on a computer bulletin for the oil industry, transmitted over a private satellite system and passively received by subscribers. The claim against the Arizona defendants was based solely on communications made from Arizona to the reporter in New Jersey when the reporter was researching the article. At least two of the plaintiff's Utah customers subscribed to the service and, additionally, in direct response to the article two of the plaintiff's key suppliers terminated its credit lines.

The court found that personal jurisdiction existed over the Maryland company and over the reporter who researched, authored, and edited the article, even though she apparently made only a single telephone call to a Utah source. The reporter had intentionally contacted the forum and the company had intentionally sent the article into the forum and thus both could reasonably foresee being haled into court in Utah.

However, the court held that the contacts of the Arizona defendants were insufficient to establish personal jurisdiction even under the "relaxed minimum contacts standards" applicable to libel actions. The communications were neither initiated nor received in Utah. Furthermore, the Arizona defendants had no control over the article's publication in Utah. Similarly, the court found no jurisdiction existed over those individual defendants who were employees of the Maryland company, but had no responsibility for or knowledge of the article until after distribution.

Finally, in Barrett the court held that it lacked jurisdiction over a non-resident defendant whose alleged defamatory statement concerning plaintiff's views on fluoridation appeared on two informational web sites maintained by her. The court characterized these web sites as passive.

Following a review of cases involving personal jurisdiction questions involving Internet activity, the motion judge observed some activity in the forum state was required beyond the maintenance of an informational web site accessible to forum residents. The court emphasized that the fact that the information is accessible is not synonymous with purposeful activity in the forum. Finding no evidence that the allegedly defamatory remarks deliberately or knowingly targeted Pennsylvania residents, the court refused to exercise jurisdiction over the non-resident defendant.

Here, the allegedly defamatory remarks were posted on a closed network available solely to Continental flight crews. To be sure, the messages or threads posted on the network are available to be read by any crew member who uses the Forum, however, there is nothing in this record to suggest that the remarks were specifically targeted at this state or were calculated to produce identifiable harm to plaintiff in this state. Plaintiff has never resided in New Jersey, and none of the non-resident defendants have ever resided here. None have ever been based in New Jersey. Plaintiff was based in Newark for five years but her base had been transferred to Houston in January 1993, at least two years before the first allegedly defamatory thread was posted. Admittedly, plaintiff's residence in this state is not a separate jurisdictional requirement and lack of residence will not defeat jurisdiction on non-resident defendants based on their activities within the forum. However, unlike in Calder and Keeton, we have no evidence that the non-resident defendants continuously and deliberately directed their comments to this state or caused any identifiable harm in this state. The act of posting a message on the Forum's electronic bulletin board to which access is restricted to a defined and relatively small group and is further restricted by personal choice, purchase of equipment and payment of a fee is not an act purposefully or foreseeably aimed at this state. There is no nationwide jurisdiction for defamation actions, and the advent of the Internet and electronic bulletin boards such as the Forum does not change that fact.

Thus we, like Judge Fuentes, conclude that the connection between the non-resident defendants and this state is too attenuated to sustain personal jurisdiction.



Affirmed.



NOTES FOLLOWING BLAKEY v. CONTINENTAL AIRLINES, INC.


1. Suppose defendants thought Ms. Blakey resided in New Jersey, different result? For example, consider a defamatory posting concerning an incident in New Jersey. Would the court now have an interest in resolving the controversy?


2. What jurisdictions are available for Ms. Blakey to bring suit against all the defendants in one court?


3. What would the consequences have been for personal jurisdiction if New Jersey had granted jurisdiction? Would this exacerbate forum shopping, where a plaintiff files suit in the most favorable forum for the dispute?


4. Suppose Panavision found that its Texas customers were confused by Toeppen's web site. Could Toeppen have been subject to suit in Texas because of the effect of his tortious conduct upon users in Texas?

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