Online Advertising and Marketing: Personal Jurisdiction and Its Potential Implications

Abstract

Modern telecommunication technology ushered in an era of unprecedented growth of innovative advertising vehicles with increasingly global reach. The online advertising industry grew more than 10-fold in the last decade. However, due to their virtually unlimited reach, online advertising and marketing are vulnerable to lawsuits with parties based in other states or countries. This article presents a discussion and interpretation of the latest legal developments of the law of personal jurisdiction and its impact on online advertisers, as well as some recommendations that might help advertisers to assess and mitigate their risk of being sued in another jurisdiction.

Acknowledgments

This article was accepted by Claude Martin and James Leigh, previous editors of the Journal of Current Issues and Research in Advertising.

Notes

¹Another important kind of jurisdiction in a civil (noncriminal) case is referred to as subject-matter jurisdiction. Subject-matter jurisdiction is the ability of a particular court to hear the case. For example, federal courts will only hear cases involving diversity of citizenship (all of the plaintiffs are from states or countries different from where all of the defendants are from) plus more than $75,000 in damages. Federal courts will also hear federal question cases that arise under federal law, such as federal statutes, regulations, or the U.S. Constitution.

²Jurisdiction over criminal cases is generally less complicated than over civil cases. Normally the jurisdiction (state) in which the crime is committed has jurisdiction to hear the case. There are numerous federal laws governing Internet crimes since they are almost always interstate in nature.

^{3 3}The 5th Amendment Due Process clause applies to actions by the federal government. This requires federal courts to apply minimum contacts analysis to personal jurisdiction. The 14th Amendment Due Process clause has been interpreted to incorporate selectively the 5th Amendment's protections to citizens that might arise from the actions of state government. Thus, state courts must also adhere to minimum contacts in regards to personal jurisdiction.

⁴To test whether the bringing of the defendant into the forum state is reasonable, the Supreme Court requires that five factors must be considered. They are: (1) the burden on the defendant; (2) the forum state's interest in adjudicating the dispute; (3) the plaintiff's interest in convenient and effective relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several states in furthering substantive social policies (Burger King 1985).

Note. X indicates possible action to be taken, depending on medium.