Sun, Nov. 17

Court of Appeals ruling nixes judicial relief on Internet purchases

A word of warning to those who shop the World Wide Web: Don't count on being able to sue sellers in Arizona courts when what you bought isn't what you thought you were getting.

That's the message in a new decision by the state Court of Appeals which threw out the lawsuit filed by an Arizona man who bought a car on eBay from a man in Michigan.

In a precedent-setting case, the judges said the fact that the buyer read the Internet ad in Arizona does not automatically give jurisdiction to courts here. And Judge John Pelander, writing for the appellate court, said the fact that the seller knew his ad would be read by an Arizonan -- and the sale might be made to a resident of this state -- doesn't change that fact.

Tucsonan Jimmie Holland said in court papers that he bought a 1976 Cadillac sedan for $15,100 in 2007 through eBay from Michael Hurley of Michigan.

Holland paid extra to have the vehicle shipped to Arizona. Once it arrived, he said, it required repairs and Holland said it did not match Hurley's representations of the vehicle's condition on eBay.

That resulted in a lawsuit by Holland against Hurley in Pima County Superior Court. When a trial judge dismissed the case, Holland appealed.

Pelander said the fact someone being sued is not in Arizona does not automatically deprive courts here of jurisdiction. But he said the person must have "sufficient minimum contacts' with the state so that the lawsuit "does not offend traditional notions of fair play and substantial justice.'

The judge also said that the issue is not the quantity of the contacts but the quality. He said, though, that "isolated or sporadic' contacts will not suffice.

Pelander said there are situations where a court can exercise jurisdiction over someone who purposely conducted business in the state and the claim arises out of that person's conduct within the state.

In this case, Holland argued that Hurley's "use of the interstate juggernaut eBay to market his automobile must be viewed as a savvy marketing enterprise that was, in itself, the purposeful direction of his product into Arizona.' And he said that Hurley, in directing his advertising to Arizona -- and every other state -- knew he would be subjecting himself to being sued in whichever state the vehicle sold.

But Pelander said simply marketing an item on eBay doesn't make someone subject to suit in all 50 states.

There is an exception to that, though.

Pelander pointed out that the Arizona Supreme Court did allow someone to sue an Italian firm that manufactured replicas of historic guns in state courts, even though the seller never set foot in the state and even though it didn't specifically market to Arizonans.

What's different there, Pelander said, is that disallowing a lawsuit in Arizona essentially would immunize foreign manufacturers who design goods for the U.S. market from lawsuits in this country for their defective products.

"That concern is not present here,' Pelander wrote. "Holland could sue Hurley where he resides, in Michigan.'

And the judge said Hurley's sales activities on eBay are nowhere comparable to the "extensive manufacturing, marketing and sales strategies' of the Italian gun manufacturer.

The appellate judges also said that lawsuits in Arizona courts might sometimes be allowed when the person conducting the sale also operates the web site. But here, too, the judges said, there is no evidence that Hurley owned the web site or had control of its activity.

Finally, Pelander said there was nothing to show that Hurley, in putting the vehicle up for sale, had any control over the state of residence of the buyer.

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