SW Legal studies in Business

No Personal Jurisdiction in State of Buyer Over Seller via eBay
Description

Appeals court held that when a buyer of merchandise on eBay is in one state and the seller is in another state, the courts in the state of the buyer do not have personal jurisdiction over the seller in the event of a dispute about the deal.

Topic Court Procedure
Key Words

Personal Jurisdiction; eBay; Breach of Contract; Fraud

C A S E   S U M M A R Y
Facts

Boschetto, who lives in California, bought a 1964 Ford Galaxie 500XL that was advertised on eBay by a seller, Hansing, who lives in Wisconsin. He stated that the car was in excellent condition, classified as “R code.” Boschetto paid $34,106 and had the car shipped to him. Then he discovered that it was not “R code” and had many problems. Hansing would not rescind the deal, so Boschetto sued him in federal court in California. Hansing moved to dismiss based on lack of personal jurisdiction. The court agreed and dismissed the suit. Boschetto appealed.

Decision

Affirmed. Due process requires that principles be applied to impose jurisdiction over a nonresident: 1) the defendant must purposefully direct his activities with the forum (California in this case) or resident so as to invoke the benefits and protections of its laws; 2) the claim must be one which arises out of or relates to defendant’s forum-related activities, and 3) the exercise of jurisdiction must comport with fair play and substantial justice. Hansing did not purposefully avail himself of the privilege of doing business in California when he a sold one car to a buyer by an Internet auction site, and so was not subject to specific personal jurisdiction by courts in California. The fact that eBay is in interstate commerce does not change the result, as it is only a virtual forum for the exchange of goods, not a merchant selling the goods, a car in this case, in California.

Citation

Boschetto v. Hansing, 539 F.3d 1011 (9th Cir., 2008)

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