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NY Court of Appeals Rejects Claim of Internet Jurisdiction
Long-arm jurisdiction over non-domiciliaries is an issue that continues to bedevil practitioners and litigants in the Internet age. In New York, CPLR 302(a)(1) authorizes jurisdiction over a non-domiciliary that “transacts any business” within the state. CPLR 302(a)(1) provides in relevant part:
(a) Acts which are the basis of jurisdiction. As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any non-domiciliary, ' , who in person or through an agent:
1. transacts any business within the state or contracts anywhere to supply goods or services in the state'.
The test, however, can be difficult to apply when a commercial entity uses technology to project itself into New York to conduct business transactions and otherwise lacks an in-state physical presence.
Consider that it was only a few years ago when the New York Court of Appeals ruled that '302(a)(1) conferred long-arm jurisdiction over an out-of-state institutional investor who called the plaintiff, a New York securities firm, to make a trade, and the suit arose from that transaction. See, Deutsche Bank Sec. v. Montana Bd. of Invs., 7 N.Y.3d 65 (2006). Only one year later, the court decided that California defendants had “transacted business” where they had formed an attorney-client relationship with the plaintiff attorney in New York through numerous telephone calls, faxes, mail contacts and e-mails. See, Fischbarg v. Doucet, 9 N.Y.3d 375 (2007).
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