Online Retailer Not Subject to Personal Jurisdiction in Michigan
The mere fact that Michigan residents are able to access an online retailer's website is not enough to subject the retailer to personal jurisdiction in Michigan courts according to the recent decision in Impulsaria, LLC v. United Distribution Group, LLC, No. 11-cv-1220 (Bell, J.).
The underlying lawsuit involves various claims by Impulsaria, an herbal supplement manufacturer, against individuals and businesses that allegedly sold counterfeit versions of Impulsaria's "Stiff Nights" supplement. One such defendant, Willy Alejo, a New Jersey resident who owns an online internet company, www.levellenatural.com, moved to dismiss the case against him for lack of personal jurisdiction. He argued that his only connection to the State of Michigan is that his website could be accessed by a Michigan resident over the internet. But his online business (which is operated by a New Jersey LLC) has no business operations in Michigan, is not authorized to do business there, has no office or salespersons there, has not advertised there, and has not been required to pay Michigan taxes.
The Court granted Alejo's motion and dismissed the lawsuit against him, finding that Impulsaria failed to make a prima facie showing of personal jurisdiction. Specifically, nothing in the Complaint or the proofs showed that Alejo "purposefully availed" himself of the laws of Michigan. Applying the Zippo sliding scale of interactivity, the Court found that the mere availability of an online retailer's website to Michigan residents did not constitute the purposeful availment required for personal jurisdiction. More is required to subject a non-resident online retailer to legal process in Michigan. In this case, Impulsaria did not even show that Alejo's website "targeted Michigan residents, . . . has done business with Michigan residents, or . . . has shipped a single product into Michigan."
This dismissal does not close the entire trademark infringement case, however, as other defendants that remain in the lawsuit.