Case: 21-30098 Document: 00516102145 Page: 1 Date Filed: 11/19/2021
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
November 19, 2021
No. 21-30098 Lyle W. Cayce
Clerk
Admar International, Incorporated; Luv N Care,
Limited,
Plaintiffs—Appellants,
versus
Eastrock, L.L.C., doing business as Haakaa U S A,
Defendant—Appellee.
Appeal from the United States District Court
for the Western District of Louisiana
USDC No. 3:20-CV-904
Before Higginbotham, Smith, and Ho, Circuit Judges.
James C. Ho, Circuit Judge:
Merely running a website that is accessible in all 50 states, but that
does not specifically target the forum state, is not enough to create the
“minimum contacts” necessary to establish personal jurisdiction in the
forum state under International Shoe Co. v. Washington, 326 U.S. 310, 316
(1945). The defendant must take the additional step of targeting the forum
state in a manner that reflects “purposeful availment” of the opportunity to
do business in that state. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475
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(1985). No such step was taken here, so we affirm the dismissal of this case
for lack of personal jurisdiction.
I.
Plaintiffs Luv N’ Care, Ltd. and Admar International, Inc. are in the
baby products business. They allege that Eastrock, LLC—a Wisconsin
company with its principal place of business in Wisconsin—committed
copyright and trade dress infringement by displaying copies of their products
on its website.
Plaintiffs might have sued Eastrock in Wisconsin. They instead chose
Louisiana. But Eastrock has no offices, no salespeople, and no stores in that
state. Nor is Eastrock licensed to do business there. And although a few
third-party stores in Louisiana carry Eastrock’s products, none of these
stores carry the products at issue in this appeal.
Instead, the accused products are available only on Eastrock’s
website, as well as on three third-party sites: Amazon.com, Target.com, and
buybuybaby.com. Eastrock has neither sold nor shipped a single accused
product to a Louisiana resident through its website. As for Amazon and
Target, Eastrock delivers the products to distribution centers—none of
which are in Louisiana—but is not involved in sales or shipments to
consumers. Finally, Eastrock “drop-ships” products for BuyBuyBaby—that
is, BuyBuyBaby first sells a product to a consumer, and then it purchases the
product from Eastrock, who then ships the item directly to the consumer.
Under this scheme, only one accused product has been shipped to a
Louisiana resident.
To be sure, Eastrock does publicly display the accused products on its
website, where it advertises the products and offers them for sale. But
Eastrock does not direct any advertising at Louisiana in particular. Eastrock
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simply runs an interactive website that is accessible throughout the United
States.
Eastrock moved to dismiss for lack of personal jurisdiction. The
magistrate judge determined that Eastrock’s website was not enough to
create minimum contacts with Louisiana and thus recommended that the
motion be granted. The district court agreed and dismissed the suit.
Plaintiffs now appeal.
II.
Personal jurisdiction is a question of law reviewed de novo. Mink v.
AAAA Dev. LLC, 190 F.3d 333, 335 (5th Cir. 1999). The Supreme Court has
repeatedly reaffirmed that, as a matter of due process, courts may exercise
personal jurisdiction over a nonresident defendant only if “(1) that defendant
has purposefully availed himself of the benefits and protections of the forum
state by establishing ‘minimum contacts’ with the forum state; and (2) the
exercise of jurisdiction . . . does not offend ‘traditional notions of fair play
and substantial justice.’” Id. at 336 (quoting Int’l Shoe, 326 U.S. at 316).
Forum contacts may be sufficient to give rise to either specific or
general jurisdiction. “Specific jurisdiction exists when the nonresident
defendant’s contacts with the forum state arise from, or are directly related
to, the cause of action. General jurisdiction exists when a defendant’s
contacts with the forum state are unrelated to the cause of action but are
‘continuous and systematic.’” Id. (citations omitted). In this appeal,
Plaintiffs rely only on specific jurisdiction.
We apply a three-step test to determine whether specific jurisdiction
exists. First, Plaintiffs must show that Eastrock has minimum contacts with
Louisiana—that Eastrock purposefully directed its activities at Louisiana and
availed itself of the privilege of doing business there. See, e.g., Seiferth v.
Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir. 2006). Second,
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Plaintiffs must show that their cause of action arises out of Eastrock’s
Louisiana contacts. See id. And third, if Plaintiffs satisfy the first two steps,
then Eastrock must show that exercising jurisdiction would prove unfair or
unreasonable. See id. We conclude that Plaintiffs have failed at the first
step—purposeful availment—and thus have no occasion to address steps two
and three.
“The analysis applicable to a case involving jurisdiction based on the
Internet should not be different at its most basic level from any other personal
jurisdiction case.” Pervasive Software, Inc. v. Lexware GmbH & Co. KG, 688
F.3d 214, 226–27 (5th Cir. 2012) (cleaned up). To assess the existence or
absence of purposeful availment based on activities on the Internet, this court
has adopted the framework set forth in Zippo Manufacturing Co. v. Zippo Dot
Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997). See Mink, 190 F.3d at 336.
Under Zippo, a defendant has purposefully availed itself of the benefits and
protections of the forum state if it “enters into contracts with residents of
[the] foreign jurisdiction that involve the knowing and repeated transmission
of computer files over the Internet.” 952 F. Supp. at 1124. It has not done
so simply by posting information on a passive website. Id. Between those
extremes, purposeful availment turns on “the level of interactivity and
commercial nature of the exchange of information that occurs on the Web
site.” Id.
At bottom, Zippo seeks to answer the question: Has the defendant
targeted the forum state? See Pervasive Software, 688 F.3d at 228. The
touchstone of personal jurisdiction remains the existence of “some act by
which the defendant purposefully avails itself of the privilege of conducting
activities within the forum State, thus invoking the benefits and protections
of its laws.” Id. at 222 (quotations omitted).
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Plaintiffs essentially rest their case for personal jurisdiction on
Eastrock’s website. Their argument can be distilled to this: (1) Eastrock runs
an interactive website; (2) the accused products are illegally displayed,
advertised, promoted, and offered for sale on the website; (3) the website
targets the entire United States, so Eastrock has minimum contacts with
Louisiana, and (4) this suit arises from those contacts.
Missing here is any evidence that Eastrock’s website specifically
targets Louisiana. To be sure, Eastrock’s website is more than passive—the
site receives purchases, allows customers to create accounts, and accepts
product reviews. But there is no evidence that Eastrock has “engag[ed] in
business transactions with forum residents” or entered contracts with them.
Mink, 190 F.3d at 337 (citing Zippo, 952 F. Supp. at 1125–26).
That leaves us in the middle of the Zippo spectrum, so we must
consider “the level of interactivity” of Eastrock’s website. Id. at 336. And
as we explained in Pervasive Software, “[w]ebsite interactivity is important
only insofar as it reflects . . . purposeful targeting of residents of the forum
state.” 688 F.3d at 228 (quotations omitted). See also id. at 227 n.7.
Plaintiffs contend that Eastrock’s interactive website targets the
entire United States, and so it necessarily targets Louisiana. But we have
previously rejected this “greater includes the lesser” theory. In Revell v.
Lidov, 317 F.3d 467 (5th Cir. 2002), the plaintiff brought a defamation action
in Texas against two out-of-state defendants. Id. at 469. The suit arose from
an article that one defendant posted to an online bulletin board published and
operated by the other defendant from New York. Id. We rejected personal
jurisdiction over both defendants, reasoning that the allegedly defamatory
article was accessible in Texas, but it “was not directed at Texas readers as
distinguished from readers in other states.” Id. at 473. See also id. at 475
(“[T]he post to the bulletin board here was presumably directed at the entire
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world, or perhaps just concerned U.S. citizens. But certainly it was not
directed specifically at Texas.”).
Similarly, in Pervasive Software, we observed that a German defendant
“ha[d] no offices or sales agents in Texas and solicit[ed] no business there
through advertising targeted specifically to Texas.” 688 F.3d at 228 (emphasis
added). Although the defendant’s “website [was] accessible worldwide,” id.
at 218, its “actions of making its [products] internet-accessible were not
purposely directed toward Texas,” id. at 227. We concluded that personal
jurisdiction failed because the defendant’s website was merely accessible in
the forum and did not target the forum. Id. at 227–28.
So too here. Louisiana residents can access Eastrock’s website, no
less than residents of other states. But as our cases suggest, and as we now
expressly hold, a defendant does not have sufficient minimum contacts with
a forum state just because its website is accessible there. The defendant must
also target the forum state by purposefully availing itself of the opportunity
to do business in that state. And here, there is no evidence that Eastrock
targets Louisiana: Eastrock has not sold a single accused product to a
Louisiana resident, and it solicits no business there through targeted
advertising. That ends this case.
Our sister circuits have confronted the same question we face today
and reached the same outcome. See, e.g., be2 LLC v. Ivanov, 642 F.3d 555,
559 (7th Cir. 2011) (“If the defendant merely operates a website, even a
‘highly interactive’ website, that is accessible from, but does not target, the
forum state, then the defendant may not be haled into court in that state
without offending the Constitution.”); Shrader v. Biddinger, 633 F.3d 1235,
1241 (10th Cir. 2011) (“The maintenance of a web site does not in and of
itself subject the owner or operator to personal jurisdiction, even for actions
relating to the site, simply because it can be accessed by residents of the
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forum state.”); GTE New Media Servs. Inc. v. BellSouth Corp., 199 F.3d 1343,
1350 (D.C. Cir. 2000) (rejecting argument that the “mere accessibility of the
defendants’ websites establishes the necessary ‘minimum contacts’ with
[the] forum”).
To hold otherwise would be too much. Take this case: If Eastrock has
minimum contacts with Louisiana, then it has minimum contacts with all 50
states, for no other reason than that it put up a website. No other circuit has
endorsed such a sweeping view. Neither do we. 1
***
The Internet is premised on the lack of territorial limits. Personal
jurisdiction works just the opposite. Merely running a website that is
accessible in the forum state does not constitute the purposeful availment
required to establish personal jurisdiction under longstanding principles of
due process. We accordingly affirm.
1
Plaintiffs also suggest in passing that Eastrock may have established minimum
contacts with Louisiana when it shipped an accused product for BuyBuyBaby. But
Eastrock’s delivery of a single $13 product to Louisiana is the type of isolated act that does
not create minimum contacts. See Pervasive Software, 688 F.3d at 228 (“A corporation’s
sales to forum residents must be more than ‘isolated’ occurrences for the assertion of
jurisdiction to satisfy the requirements of due process.”).
7