Abdouch v. Lopez, 285 Neb. 718 (2013)

Abdouch v. Lopez

285 Neb. 718 (2013)


Facts:

Abdouch is a resident of Omaha, Nebraska. In 1960, Abdouch was the executive secretary of the Nebraska presidential campaign of John F. Kennedy. In 1963, Abdouch received a copy of the book, which was inscribed to her by the late author Richard Yates. The inscription stated: "For Helen Abdouch — with admiration and best wishes. Dick Yates. 8/19/1963."

At some time not specified by the record, Abdouch's inscribed copy of the book was stolen. Lopez and his company, KLB, bought the book in 2009 from a seller in Georgia and sold it that same year to a customer not in Nebraska. In 2011, Abdouch, who does not own a computer, learned from a friend that Lopez had used the inscription in the book for advertising purposes on his Web site, http://www.lopezbooks.com. The commercial advertisement had been used with the word "SOLD" on the Web site for more than 3 years after the book was sold. The advertisement associated with a picture of the inscription stated in relevant part:

This copy is inscribed by Yates: "For Helen Abdouch — with admiration and best wishes. Dick Yates. 8/19/63." Yates had worked as a speech writer for Robert Kennedy when Kennedy served as Attorney General; Abdouch was the executive secretary of the Nebraska (John F.) Kennedy organization when Robert Kennedy was campaign manager. The book is cocked; the boards are stained; the text is clean. A very good copy in a near fine, spine-tanned dust jacket. A scarce book, and it is extremely uncommon to find this advance issue of it signed. Given the date of the inscription — that is, during JFK's Presidency — and the connection between writer and recipient, it's reasonable to suppose this was an author's copy, presented to Abdouch by Yates. [#028096] SOLD

Lopez is the owner and sole proprietor of KLB, which is a rare book business based in Hadley, Massachusetts. KLB buys and sells rare books and manuscripts. KLB sells these books and manuscripts through published catalogs and through the Web site.

Generally, the Web site contains KLB's inventory of rare books and manuscripts. Individuals that visit the Website can browse and search the inventory. If individuals or entities choose to, they can purchase through the Web site.

In addition to selling books through catalogs and online, KLB attends and has exhibits at various antiquarian bookfairs. Over the past 25 years, Lopez and/or KLB have attended and exhibited at an estimated 300 to 400 bookfairs in various locations within the United States, as well as overseas. Lopez and KLB have never exhibited at or attended a book fair in Nebraska.

KLB has an active mailing list for its catalogs of approximately 1,000 individuals and entities. Among that list, only two are located in Nebraska. According to Lopez' affidavit, KLB did not solicit the two Nebraska members; rather, the two individuals solicited contact with KLB and requested to be placed on the mailing list. Neither of these two individuals has any connection to the claims at issue in this lawsuit.

Neither Lopez nor KLB is registered to do business in Nebraska in any capacity. Lopez and KLB do not own or lease real estate in Nebraska, do not maintain an office in Nebraska, and have never conducted or attended meetings in Nebraska. Neither Lopez nor KLB has paid any Nebraska sales tax.

Lopez and KLB do not advertise in any publication that is published in or that otherwise originates from Nebraska. Lopez and KLB do not advertise in any publication that specifically targets potential customers in Nebraska. Beyond the two customers on the mailing list, Lopez and KLB do not target or reach out to customers or potential customers in Nebraska in any way.

The amount of contact with Nebraska and Nebraska residents is also demonstrated by KLB's sales. KLB's total sales for 2009 through 2011 were approximately $3.9 million. In 2009, KLB sold three books to a single Nebraska customer, earning a total of $76. In 2010, KLB sold three books to two Nebraska customers for $239.87. In 2011, two books were sold to a Nebraska customer for $299. All of these sales were initiated by the customers through the Web site.

Abdouch alleges that Lopez knew she was a resident of Nebraska when he violated her privacy. Lopez avers in his affidavit that he did not know that Abdouch was a resident of Nebraska until in or around June 2011, at which time he was contacted by someone and told that Abdouch lived in Nebraska. In Abdouch's affidavit, she counters that she has been informed that she can be easily found and identified as a Nebraska resident on the Internet and that there are only two people named "Helen Abdouch" in the entire United States.

After discovering Lopez and KLB's use of the inscribed book as an advertisement, Abdouch brought suit pursuant to § 20-202 against Lopez and KLB for violating her vigilantly protected right of privacy. In a relevant part of the complaint, she alleged:

5.That . . . Lopez did an internet search for "Helen Abdouch" and found a brief reference to her as "executivesecretary of the Nebraska (John F.) Kennedy campaign" in an October 10, 1960, Time Magazine article entitled: "DEMOCRATS: Little Brother is Watching" based on an interview with Robert F. Kennedy, campaign manager of his brother's John F. Kennedy's presidential campaign.

6. That based on this article, . . . Lopez wrote an ad for the sale of Abdouch's book on his online catalogue linking [Abdouch] to Yates through the Kennedy connection . . . and placed on [the KLB Web site] at www.lopezbooks.com and which was "broadcast" or sent out over the world wide web.

7. That by his own admission, . . . Lopez did not search the internet to determine whether . . . Abdouch was still alive and assumed she was dead so he made no further effort to get her permission.

Lopez and KLB filed a motion to dismiss for lack of personal jurisdiction, alleging that they do not have sufficient contacts with Nebraska for purposes of personal jurisdiction and have not purposefully availed themselves of the benefits and protections of the forum state. The district court granted the motion and dismissed the case.

Issue:

Abdouch assigns as error the district court's finding that it lacked personal jurisdiction over Lopez and KLB.

Reasoning:

IV. STANDARD OF REVIEW

When a jurisdictional question does not involve a factual dispute, the issue is a matter of law. An appellate court reviews questions of law independently of the lower court's conclusion. When reviewing an order dismissing a party from a case for lack of personal jurisdiction under Neb. Ct. R. Pldg. § 6-1112(b)(2), an appellate court examines the question of whether the nonmoving party has established a prima facie case of personal jurisdiction de novo. 

An appellate court reviews a lower court's determination regarding personal jurisdiction based on written submissions in the light most favorable to the nonmoving party. If the lower court does not hold a hearing and instead relies on the pleadings and affidavits, then an appellate court must look at the facts in the light most favorable to the nonmoving party and resolve all factual conflicts in favor of that party.

V. ANALYSIS

Abdouch argues that the district court erred in finding that the State lacked personal jurisdiction over Lopez and KLB. Abdouch argues that Lopez and KLB's active Web site deliberately targeted Abdouch with tortious conduct. She alleges these contacts are sufficient to create the necessary minimum contacts for specific jurisdiction.

Personal jurisdiction is the power of a tribunal to subject and bind a particular entity to its decisions. Before a court can exercise personal jurisdiction over a nonresident defendant, the court must determine, first, whether the long-arm statute is satisfied and, if the long-arm statute is satisfied, second, whether minimum contacts exist between the defendant and the forum state for personal jurisdiction over the defendant without offending due process.

1. Long-Arm Statute

Nebraska's long-arm statute, Neb. Rev. Stat. § 25-536 provides: "A court may exercise personal jurisdiction over a person . . . [w]ho has any other contact with or maintains any other relation to this state to afford a basis for the exercise of personal jurisdiction consistent with the Constitution of the United States." It was the intention of the Legislature to provide for the broadest allowable jurisdiction over nonresidents under Nebraska's longarm statute. Nebraska's long-arm statute, therefore, extends Nebraska's jurisdiction over nonresidents having any contact with or maintaining any relation to this state as far as the U.S. Constitution permits. "[W]hen a state construes its long-arm statute to confer jurisdiction to the fullest extent permitted by the due process clause, . . . the inquiry collapses into the single question of whether exercise of personal jurisdiction comports with due process." Therefore, the issue is whether Lopez and KLB had sufficient contacts with Nebraska so that the exercise of personal jurisdiction would not offend federal principles of due process.

2. Minimum Contacts

Therefore, we consider the kind and quality of Lopez' and KLB's activities to decide whether they had the necessary minimum contacts with Nebraska to satisfy due process. To subject an out-of-state defendant to personal jurisdiction in a forum court, due process requires that the defendant have minimum contacts with the forum state so as not to offend traditional notions of fair play and substantial justice. The benchmark for determining whether the exercise of personal jurisdiction satisfies due process is whether the defendant's minimum contacts with the forum state are such that the defendant should reasonably anticipate being haled into court there. Whether a forum state court has personal jurisdiction over a nonresident defendant depends on whether the defendant's actions created substantial connections with the forum state, resulting in the defendant's purposeful availment of the forum state's benefits and protections. 

In analyzing personal jurisdiction, we consider the quality and type of the defendant's activities in deciding whether the defendant has the necessary minimum contacts with the forum state to satisfy due process. A court exercises two types of personal jurisdiction depending upon the facts and circumstances of the case: general personal jurisdiction or specific personal jurisdiction. In the exercise of general personal jurisdiction, the plaintiff's claim does not have to arise directly out of the defendant's contacts with the forum state if the defendant has engaged in "'"'continuous and systematic general business contacts'"'" with the forum state. 

But if the defendant's contacts are neither substantial nor continuous and systematic, as Abdouch concedes is the case here, and instead the cause of action arises out of or is related to the defendant's contacts with the forum, a court may assert specific jurisdiction over the defendant, depending upon the nature and quality of such contact. 

In favor of specific jurisdiction, Abdouch argues that Lopez and KLB's Internet advertisement deliberately targeted Abdouch and other Nebraska residents. Abdouch argues that under a U.S. Supreme Court case, Lopez' and KLB's intentional tortious actions against her create specific jurisdiction in Nebraska.

(a) "Sliding Scale" Test

The Internet and its interaction with personal jurisdiction over a nonresident is an issue of first impression for this court. Although other courts will help guide our decision, we take note that technological advances do not render impotent our longstanding principles on personal jurisdiction.The U.S. Supreme Court explained:

As technological progress has increased the flow of commerce between States, the need for jurisdiction over nonresidents has undergone a similar increase. At the same time, progress in communications and transportation has made the defense of a suit in a foreign tribunal less burdensome. In response to these changes, the requirements for personal jurisdiction over nonresidents have evolved from the rigid rule of Pennoyer v. Neff,to the flexible standard of International Shoe Co. v. Washington.But it is a mistake to assume that this trend heralds the eventual demise of all restrictions on the personal jurisdiction of state courts. . .. Those restrictions are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective States.

With this in mind, the Eighth Circuit, as well as the majority of circuits, has adopted the analytical framework set forth in Zippo Mfg. Co. v. Zippo Dot Com, Inc.,for internet jurisdiction cases. In that case, Zippo Manufacturing Company filed a complaint in Pennsylvania against nonresident Zippo Dot Com, Inc., alleging causes of action under the federal Trademark Act of 1946. Zippo Dot Com's contact with Pennsylvania consisted of over 3,000 Pennsylvania residents subscribing to its Web site. The district court in Zippo Mfg. Co. famously created a "sliding scale" test that considers a Web site's interactivity and the nature of the commercial activities conducted over the Internet to determine whether the courts have personal jurisdiction over nonresident defendants. The court in Zippo Mfg. Co. explained the "sliding scale" as follows:

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, personal jurisdiction is proper. . .. At the opposite end are situations where a defendant has simply posted information on an Internet Web site which is accessible to users in foreign jurisdictions. A passive Web site that does little more than make information available to those who are interested in it 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 district court held that Pennsylvania had personal jurisdiction over Zippo Dot Com and the causes of action. In doing so, the district court made two important findings. First, the district court found that the Zippo Dot Com Web site was a highly interactive commercial Web site. Second, and more important, the district court found that the trademark infringement causes of action were related to the business contacts with customers in Pennsylvania.

Although widely recognized and accepted, most circuits use the Zippo Mfg. Co.sliding scale of interactivity test only as a starting point. As the Second Circuit noted, "'it does not amount to a separate framework for analyzing internet-based jurisdiction'"; instead, "'traditional statutory and constitutional principles remain the touchstone of the inquiry.'"

The Seventh Circuit has noted that "'[c]ourts should be careful in resolving questions about personal jurisdiction involving online contacts to ensure that a defendant is not haled into court simply because the defendant owns or operates a website that is accessible in the forum state, even if that site is "interactive."'" Many courts have held that even if the defendant operates a "'highly interactive'" Web site which 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. 

Our precedent states that for there to be specific personal jurisdiction, the cause of action must arise out of or be related to the defendant's contacts with the forum state. This is consistent with the U.S. Supreme Court's precedent which has stated "mere purchases, even if occurring at regular intervals, are not enough to warrant a State's assertion of in personam jurisdiction over a nonresident corporation in a cause of action not related to those purchase transactions." 

In the case at hand, it is evident that the Web site is interactive under the Zippo Mfg. Co. sliding scale test. In his affidavit, Lopez admits that customers can browse and purchase books from the online inventory. Lopez admits that he has two customers in Nebraska who are on the mailing list for KLB's catalogs. He admits that from 2009 through 2011, a total of $614.87 in sales from the Web site was made to Nebraska residents out of an estimated $3.9 million in total sales.

But, beyond the minimal Web site sales to Nebraska residents and mailing catalogs to two Nebraska residents, Lopez' and KLB's contacts with Nebraska are nonexistent. Lopez and KLB do not own, lease, or rent land in Nebraska. They have never advertised directly in Nebraska, participated in bookfairs in Nebraska, or attended meetings in Nebraska, and neither has paid sales tax in Nebraska.

Furthermore, the Seventh Circuit has recently stated that when "the plaintiff's claims are for intentional torts, the inquiry focuses on whether the conduct underlying the claims was purposely directed at the forum state." The reason for requiring purposeful direction is to "'ensure that an out-of-state defendant is not bound to appear to account for merely "random, fortuitous, or attenuated contacts" with the forum state.'" Here, Abdouch's cause of action is an intentional tort based on Nebraska's privacy statute. There is no evidence, as discussed in greater detail later in the opinion, that Lopez and KLB purposefully directed the advertisement at Nebraska. Further, there is no evidence that Lopez and KLB intended to invade Abdouch's privacy in the State of Nebraska. Rather, the limited Internet sales appear to be random, fortuitous, and attenuated contacts with Nebraska.

Therefore, although Lopez and KLB's Web site is highly interactive, all of the contacts created by the Web site with the State of Nebraska are unrelated to Abdouch's cause of action.

(b) Calder Effects Test

Abdouch argues that the effects test formulated by the U.S. Supreme Court in Calder v. Jones creates personal jurisdiction over Lopez and KLB, because Lopez and KLB aimed their tortious conduct at Abdouch and the State of Nebraska. In Calder, two Florida residents participated in the publication of an article about a California resident who brought a libel action in California against the Florida residents. Both defendants asserted that as Florida residents, they were not subject to the jurisdiction of the California court in which the libel action was filed. The Supreme Court rejected the defendants' argument and noted that the defendants were

not charged with mere untargeted negligence. Rather, their intentional, and allegedly tortious, actions were expressly aimed at California. Petitioner[s] wrote and . . . edited an article that they knew would have a potentially devastating impact upon respondent. And they knew that the brunt of that injury would be felt by respondent in the State in which she lives and works and in which the National Enquirer has its largest circulation. Under the circumstances, petitioners must "reasonably anticipate being haled into court there" to answer for the truth of the statements made in their article.

In coming to its holding, the U.S. Supreme Court created a test, now known as the Calder effects test, which has been explained by the Eighth Circuit:

"[A] defendant's tortious acts can serve as a source of personal jurisdiction only where the plaintiff makes a prima facie showing that the defendant's acts (1) were intentional, (2) were uniquely or expressly aimed at the forum state, and (3) caused harm, the brunt of which was suffered—and which the defendant knew was likely to be suffered—[in the forum state]."

Lopez and KLB's placement of the advertisement online was directed at the entire world, without expressly aiming the posting at the State of Nebraska. Abdouch pleaded in her complaint that the advertisement was "'broadcast' or sent out over the world wide web," but Abdouch failed to plead facts that demonstrate that Nebraska residents were targeted with the advertisement. Although the advertisement does mention that "Abdouch was the executive secretary of the Nebraska (John F.) Kennedy organization," the advertisement does not expressly direct its offer of sale to Nebraska. The mention of Nebraska here is incidental and was not included for the purposes of having the consequences felt in Nebraska. Lopez did not know that Abdouch was a resident of Nebraska. He assumed that she had passed away and thus had no way of knowing that the brunt of harm would be suffered in Nebraska. Abdouch's complaint fails to demonstrate that Lopez and KLB had an intent to target and focus on Nebraska residents.

In response, Abdouch alleges that this court gained personal jurisdiction in June 2011, when she had a representative contact Lopez with her objection to his commercial use of her name and identity in his advertisement. Abdouch cites the Eighth Circuit for the proposition that "'[m]inimum contacts must exist either at the time the cause of action arose, the time the suit was filed, or within a reasonable period of time immediately prior to the filing of the lawsuit.'" However, as stated by the U.S. Supreme Court in Burger King Corp. v. Rudzewicz, "'it is essential in each case that there be 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.'" We have held that under a personal jurisdiction analysis, the unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum state. Thus, personal jurisdiction over Lopez and KLB cannot be created by the telephone call from Abdouch's representative to Lopez. Such contact is insufficient for personal jurisdiction purposes.

Even accepting Abdouch's allegations as true and reviewing the record in a light most favorable to Abdouch, we find that Abdouch's complaint and general allegations failed to show that Lopez and KLB "'uniquely or expressly aimed'" the Internet advertisement at Nebraska.

Holding:

Abdouch's complaint fails to plead facts to demonstrate that Lopez and KLB have sufficient minimum contacts with the State of Nebraska. Although the Web site used to post the advertisement is interactive, the contacts created by the Web site are unrelated to Abdouch's cause of action. Furthermore, under the Calder effects test, the pleadings fail to establish that Lopez and KLB expressly aimed their tortious conduct at the State of Nebraska. For these reasons, Lopez and KLB could not have anticipated being haled into a Nebraska court for their online advertisement.


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