The U.S. Court of Appeals for the Sixth Circuit recently made a pivotal decision concerning online sales, holding that they can establish personal jurisdiction. This ruling is dependent on two factors: whether the sales are part of the company’s regular course of business, and the company’s level of control over the product’s distribution. The ruling effectively aligns the Sixth Circuit with its sister circuits on the issue, overturning a district court’s judgment on the principle of purposeful availment – a key element in establishing jurisdiction.
Notably, this ruling signifies that, regardless of a company’s business type, if a business is conducted regularly in a jurisdiction and the company willingly promotes itself to that jurisdiction’s business, it is proportionally responsible and may face legal action there. This decisive statement was given by Judge Jane Stranch, and provides a clear warning for all online retailers who may be subject to suit in any region they operate.
The broader implications of this finding call companies to reconsider their global online strategies and deepen their understanding of various jurisdictional laws, crucial in minimizing risk and possible repercussions. The legal landscape for online retailer jurisdiction continues to change, contributing several questions that remain yet to be addressed.
For more details on this ruling and its background, kindly refer to the original coverage from Law.com here.