IP Law Daily, COPYRIGHT—E.D. Mo.: Missouri court has Zippo jurisdiction over Florida resident based on a single online sale, (Apr 20, 2023)

By Matthew Hersh, J.D.

A 25-year-old case on personal jurisdiction continues to show vitality.

The fact that a Florida resident operated an interactive website that was available to Missouri residents was not enough to obtain personal jurisdiction over that resident where he had made only one actual sale to a Missouri resident, the federal court for St. Louis has held. The court, in granting the Florida resident’s motion to dismiss, based its ruling on a modern-day interpretation of a personal jurisdiction case dated to 1997 (Store Chain, Inc. v. Gilbert, April 12, 2023, Noce, D.).

The lawsuit was brought the Nevada-based company operating Bachette, an online retailer whose website promises “bachelorette party stuff that doesn’t suck.” The lawsuit accuses the operators of two other online retailers, Apex Designs and Lucy’s Chic Boutique, of infringing the company’s rights in two registered images. Those images, one called “Multi-Color Unicorn” and the other called “My Final Fiesta Unicorn Bride,” are marketed by the Nevada company as part of its line of clothing and other bachelorette party items.

The dispute that led to this opinion has to do with the location of the two defendants. According to the lawsuit, a Florida resident named Seth Matkowsky made an illegal copy of the registered images and began marketing them through his store Apex Designs. In addition, the lawsuit contended, the Florida resident also passed on a copy of the images to Melissa Gilbert, the Missouri-based operator of Lucy’s Chic Boutique.

The Florida resident moved to dismiss the lawsuit based on lack of personal jurisdiction, leading to this opinion.

Personal jurisdiction. The court granted the motion to dismiss. The central question was the extent to which the Florida resident’s online presence in Missouri could subject him to personal jurisdiction in that jurisdiction. To resolve that question, the court turned to a landmark case from the dawn of the internet age, Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119 (W.D.Pa. 1997). In that case, which has been endorsed widely endorsed since, including by the Eighth Circuit, the court set out three different categories of cases. At one end, the court noted, is where a defendant regularly “enters into contracts with residents of a foreign jurisdiction that involve the knowing and repeated transmission of computer files over the Internet.” At the opposite end, the court noted, are situations where “a defendant has simply posted information on an Internet Web site which is accessible to users in foreign jurisdictions.” Then there is a “middle ground,” the Zippo noted, where a foreign company maintains a website that is interactive but does not engage in regular and repeated transactions. “In these cases,” the Zippo court noted, “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.”

This case plainly fell into the middle ground, the court found—but the level of interaction was not enough to sustain personal jurisdiction. In this case, while the Florida resident did allegedly operate an interactive website that was accessible in Missouri, the Nevada company could point to only one sale that the resident actually made to a Missouri resident—namely, the one he made to the Missouri co-defendant. While there was some conflicting earlier precedent among Missouri district courts about whether this one sale was enough in an intellectual property context, the court noted, a more recent Eighth Circuit case—Brothers and Sisters in Christ, LLC v. Zazzle, Inc. 42 F.4th 948 (8th Cir. 2022)—made clear that it was not. Thus, there was no personal jurisdiction over the Florida retailer.

The Case is No. 4:22-cv-00938-DDN.

Attorneys: Richard A. Voytas, Jr. (Voytas Law LLC) for Store Chain, Inc. Kelly M. Spann (Fortman Spann LLC) for Melissa Gilbert.

Companies: Store Chain, Inc.

Cases: Copyright MissouriNews