E-Alert Case Updates

Mere Accessibility of Website Remains Insufficient to Confer Personal Jurisdiction

Triple Up Limited v. Youku Tudou Inc.
(January 24, 2017) United States District Court for the District of Columbia
by Matthew J. McCloskey, Associate
Semmes, Bowen & Semmes (www.semmes.com)

Available at: https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2016cv0159-15

In a recent case, the United States District Court for the District of Columbia re-examined, and ultimately affirmed, that the mere accessibility of a website in a particular location does not, by itself, subject the administrator of the website to personal jurisdiction in that location.

Plaintiff, a corporation located in and organized under the laws of Seychelles, sued Defendant, a Cayman Islands corporation with its principal place of business in China, related to Defendant’s alleged copyright infringement. Plaintiff alleged that it owned the exclusive internet broadcasting rights to three (3) Taiwanese movies (the “Movies”), and that Defendant had no license to broadcast the Movies in the United States. Plaintiff alleged that its attorneys were able to, on one occasion, access and watch the Movies through Defendant’s website through an internet connection located in Washington, D.C. Plaintiff further alleged that at least one (1) of the Movies was preceded by an English language advertisement for an American product.

Defendant did not deny that it had uploaded two (2) of the Movies to its service, but emphasized that: (1) it had an express license to display those films in China; and (2) it had implemented a “geoblocking” feature to prevent those films from being displayed in countries other than China. Defendant denied, however, that it uploaded the third Movie to its service, maintaining that a third party must have uploaded that particular Movie to its website.

Defendant moved to dismiss Plaintiff’s complaint for lack of personal jurisdiction. The Court determined that the parties presented “a single, dispositive question: Are Defendant’s contacts with the United States as a whole constitutionally sufficient to justify the exercise of specific personal jurisdiction over it with respect to Plaintiff’s asserted claims?”

Judge Randolph D. Moss began by addressing whether Defendant’s contacts with the United States were sufficient enough such that Defendant should reasonably have anticipated being haled into Court in the United States. In the context of connections to a particular location through the internet, the Court noted that several principles have been established in American law. First, “the ‘mere accessibility of the defendants’ websites’ in the forum cannot by itself” establish sufficient minimum contacts. Second, “personal jurisdiction may exist where ‘residents use [a] website to engage in electronic transactions with the [defendant].’” Third, personal jurisdiction may be found where the defendant’s conduct is “aimed at or has an effect in the forum state.” Under this precedent, Plaintiff was required to prove that Defendant’s website was not “merely accessible” in Washington, D.C., but rather that Defendant engaged in electronic transactions in that forum and directed its conduct towards that forum.

Plaintiff first argued that, because it was undisputed that Defendant could geoblock all of its videos from being displayed in the United States, Defendant’s failure to block the Movies constituted purposeful conduct intended to transmit the Movies to the United States. The Court rejected this argument, noting that Plaintiff’s argument essentially altered the “mere accessibility” principle. Specifically, accepting Plaintiff’s argument would lead to the conclusion that the administrator of any website that does not block users from a particular location is consenting to personal jurisdiction in that location. The Court was unwilling to acquiesce to such a watershed event in this case. Moreover, the Court noted that it was “unaware of any authority suggesting that a failure to act might constitute purposeful availment.” In other words, Defendant’s decision not to take action by geoblocking the United States from its entire website did not constitute intentional conduct sufficient to confer personal jurisdiction. Thus, the Court preserved the existing rule that the accessibility of a website in a particular location is essentially irrelevant to the issue of personal jurisdiction.

Plaintiff next argued that Defendant intentionally generated revenue from the United States by including English language ads for American products before its videos. The Court rejected this argument as well, holding that Plaintiff was required to “show some sort of causal relationship between a defendant’s U.S. contacts and the episode in the suit.” Because Plaintiff’s lawsuit did not pertain to the advertisements, Defendant’s conduct in permitting English language advertisements did not show purposeful availment. Notably, in reaching this conclusion, the Court expressly rejected the applicability of the “discernible relationship test” to the circumstances of this case.

The Court rejected several more of Plaintiff’s ancillary arguments. The Court held that the fact that United States users could make accounts on Defendant’s website was neither related to Plaintiff’s claims nor sufficiently “interactive” to constitute “the virtual equivalent of being present in the District of Columbia.” Nor were Defendant’s listing on the New York Stock Exchange or contracts with United States companies indicative of personal jurisdiction. Again, the Court emphasized that these contacts were simply unrelated to the issues in this case.

Finally, the Court concluded that Defendant had not directed sufficient intentional acts to the United States with regard to the Movies to subject it to personal jurisdiction in this lawsuit. The Court noted: (1) Defendant’s website was written entirely in Mandarin; (2) the Movies were Taiwanese with Mandarin subtitles; (3) the copyright holder had no connection to the United States; and (4) there was no evidence that anybody from the United States apart from Plaintiff’s attorneys had ever watched the Movies from the United States. Under these circumstances, Defendant’s conduct had not produced sufficient effects in the United State to subject it to personal jurisdiction. The Court therefore granted Defendant’s motion to dismiss.