Personal Matter Jurisdiction and Sufficient Minimum Contacts

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In order for a court to have authority over a potential defendant, the court must have personal matter jurisdiction, or in personam jurisdiction. What this means is that the court must be able to exercise its authority over that particular defendant. State courts always have personal jurisdiction over a person or entity that is physically within that state. Personal jurisdiction becomes complicated when a defendant to a lawsuit resides in a different state, but is being sued in a state where the plaintiff resides. The court will only have jurisdiction over the defendant from another state in certain situations.

Analyzing Whether or Not a Court has Personal Jurisdiction

There are two main steps to analyzing whether or not a court (forum state) has personal jurisdiction over a defendant. First, look to the long arm statute of the forum state. Every state has a long arm statute. Some states directly address in these statutes what requirements must be met in order to have personal matter jurisdiction. Other long arm statutes simply restate that personal matter jurisdiction is acceptable if such jurisdiction does not violate due process rights under the U.S. Constitution. These long arm statutes state the second prong of the personal jurisdiction analysis, that personal jurisdiction cannot violate due process. When long arm statutes such as these exist, as it does in Minnesota, the only analysis that needs to be done in order to have personal jurisdiction is to make sure that it is in line with due process.

Whether or not a court having personal jurisdiction violates due process rights under the Constitution is a more complicated process. Due process requires that for a the forum state to have jurisdiction over a defendant, that defendant must have “certain minimum contacts” with the forum state and having jurisdiction cannot violate “traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 U.S. 310 (1945). These “minimum contacts” with the forum state should be such that the defendant should reasonably anticipate to be brought to court in that state because he purposefully availed himself of the privilege of conducting activities within the forum state. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). The logic follows that if the defendant engaged in significant activities in the forum state, that because his actions are shielded by the benefits and protections of the forum state’s laws, it is not unreasonable for him to submit to the forum state’s jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476 (1985).

In Minnesota there is a five factor test to determine whether the defendant had sufficient contacts with the forum state for that state to have jurisdiction over him: (1) the quantity of contacts with Minnesota, (2) the nature and quality of the defendant’s contacts with Minnesota, (3) the connection between the cause of action and the defendant’s contacts, (4) Minnesota’s interest in providing a forum, and (5) the convenience of the parties. Aftanase v. Economy Baler Co., 343 F.2d 187, 197 (8th. Cir. 1965); Dent-Air, Inc. v. Beech Mountain Air Serv., Inc., 332 N.W.2d 904, 907 (Minn. Ct. App. 1983). The first three factors are used to determine whether or not personal jurisdiction exists, while the last two are used to determine whether or not personal jurisdiction in Minnesota is reasonable. The court will address these factors on a case by case basis to determine if the defendant truly had sufficient minimum contacts with Minnesota.

It is important to mention that the defendant entering into a contract with a resident of the forum state can constitute the requisite purposeful availment and minimum contacts; however, a contract between the parties alone cannot automatically establish sufficient minimum contacts. Burger King Corp, 471 U.S. at 478-79. Other factors regarding the contract need to be taken into consideration, including negotiations both prior and future, terms of the contract, as well as course of dealing between the parties in order to determine whether the defendant purposefully had minimum contacts with the forum state. Id. at 479. Personal matter jurisdiction is usually acceptable when a contract has a substantial connection with the forum state. Gee v. Int’l Life Ins. Co., 355 U.S. 220, 223 (1957).

Personal Jurisdiction & Sufficient Minimum Contacts for Internet Websites

Personal matter jurisdiction has been complicated recently by the advent of websites and internet businesses. Nowadays companies have websites and therefore have a presence everywhere those websites can be accessed. The main issue that has arisen is whether or not plaintiffs can sue in their own state when bringing a claim against an internet company, or whether they must bring suit in the state where the defendant resides or has its place of business. The most prevalent test in determining personal jurisdiction over an internet company comes from Zippo Mfg. v. Zippo Dot Com, 952 F.Supp. 1119 (W.D. Pa. 1997). the Zippo-test is:

At one end of the spectrum are situations where a defendant clearly does business over the internet. If the defendant enters into contracts with residents of a foreign jurisdiction that involve the knowing and repeated transmission of computer files over the Internet, the personal jurisdiction is proper. At the opposite end are situations where a defendant has simply posted information on the Internet Web site which is accessible to users in foreign jurisdictions. A passive website that does little more than make information available to those who are interested is not grounds for the exercise [of] personal jurisdiction. The middle ground is occupied by interactive Web sites where a user can exchange information with the host computer. In these cases, the exercise of jurisdiction is determined by examining the level of interactivity and commercial nature of the exchange of information that occurs on the Web site.

The Zippo Test

Id. at 11-12. The Zippo-test breaks down websites into three categories: interactive websites, passive websites, and websites that are a combination of interactive and passive. An interactive website is typically one where there is a two-way online communication that fosters an ongoing business relationship. This includes websites that allow for business transactions and where information is exchanged with the users for the purposes of soliciting business. A forum state will most likely always have personal jurisdiction over these website operators. A passive website is one in which the site makes information available to interested viewers, but no business is being transacted. In most cases, the operator of a passive website will not fall under the forum state’s exercise of personal jurisdiction. There are several websites, however, that lie somewhere in the middle. For example, some websites provide information but also allow the users to exchange information by providing email addresses, a phone number or other activity that begins an ongoing relationship to maybe solicit business in the future. The Zippo-test provides for these situations by considering how interactive the website actually is and to what extent exchanging such information is of a commercial nature. The higher the commercial nature and the interactivity of the website, the greater the chances that the website operator is purposefully availing itself of the forum state’s jurisdiction.

Minnesota does use this test as a way of determining whether or not a defendant who has a website has established minimum contacts with Minnesota. VIAD Corp. v. McCormick Int’l, No. A05-1567 (2006) (unpublished). Some additional factors that Minnesota courts look at to determine interactivity of a website include the number of hits, or views, a website has received, the number of different locations within Minnesota that have accessed the website, and if the website’s mailing list included residents of Minnesota. Minnesota v. Granite Gate Resorts, 567 N.W.2d 715 (Minn. Ct. App. 1997).

In conclusion, a court must have personal matter jurisdiction over a defendant in order to have the authority to enforce a judgment on that defendant. In most states, the court can have personal matter jurisdiction as long as doing so does not violate due process rights. In order to satisfy due process rights, the defendant must have sufficient minimum contacts with the forum state in order to fall under that state’s authority. This “minimum contacts” test may vary from state to state. When it comes to websites, determining personal matter jurisdiction is a little more complicated. The analysis comes down to how interactive the website actually is and whether or not the website is of a commercial nature. In most cases, personal jurisdiction over a defendant, whether an individual doing business in another state or an individual who operates a website elsewhere, is going to come down to the discretion of the court.