Florida Business Litigation Lawyer Blog
Businesses that conduct online commerce with Florida residents should be prepared to litigate disputes arising out of their transactions in Florida. The Fourth District Court of Appeal has described the interplay of the internet and assessments of specific and general jurisdiction as “a confusing area of the law that is mainly scattered across the federal courts…” Caiazzo v. Am. Royal Arts Corp., 73 So. 3d 245, 248 (Fla. 4th DCA 2011). As several transactions are done online, many defendants may be unsure if they can be haled into the Florida courts if they live in another state. There is a two-step process for determining if an out of state defendant can be forced to litigate in Florida. Florida’s Long Arm Statute, § 48.193, Fla. Stat., gives clear guidelines as to how jurisdiction can be acquired.
There are two types of jurisdiction that Florida has over out of state defendants: specific or general. “As the first step in a two-step process, it must initially be determined if sufficient facts exist to confer either specific jurisdiction or general jurisdiction pursuant to Florida’s long-arm statute.” Caiazzo 73 So. 3d at 250. A showing of either type of jurisdiction will establish the minimum contacts needed for the out of state defendant to be haled into a Florida court. After an assessment of minimum contacts, the court then does an assessment of due process. See Int’l Shoe Co. v. State of Wash., Office of Unemployment Comp. & Placement, 326 U.S. 310 (1945).
Fla. Stat. 48.193(1) provides specific jurisdiction over defendants where the cause of action arises out of their isolated conduct within Florida. 48.193(1) Fla. Stat. provides a non-exhaustive list of activities that can subject a defendant to specific jurisdiction, some activities that are pertinent to business defendants include, but are not limited to:
- Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.
- Committing a tortious act within this state.
- Owning, using, possessing, or holding a mortgage or other lien on any real property within this state.
- Contracting to insure a person, property, or risk located within this state at the time of contracting.
- Breaching a contract in this state by failing to perform acts required by the contract to be performed in this state.
Id. Additionally, § 48.193 (2) provides the basis for establishing general jurisdiction: “A defendant who is engaged in substantial and not isolated activity within this state, whether such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the courts of this state whether or not the claim arises from that activity.” Id.
Because no case in Florida addressed minimum contacts in relation to e-commerce, the Fourth DCA found it necessary to give the Florida courts guidance in Caiazzo. See 73 So. 3d at 248.In deciding Caiazzo, the Fourth DCA determined that it would “continue to apply a traditional minimum contacts analysis in personal jurisdiction questions, whether or not the internet is involved.” The Fourth DCA found the rubric announced in the seminal case that concerned the internet and minimum contacts, Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119 (W.D. Pa. 1997), to be useful as part of an assessment of jurisdiction. However, it found the distinction between active and passive websites to be talismanic jurisdictional terms that do not provide a conclusive answer to the question of whether Florida has jurisdiction over a person. Thus, the Fourth DCA decided not to adopt Zippo.
Therefore, non-resident online merchants that do not want to be haled into Florida courts should consider incorporating a forum selection clause into its terms and conditions of purchases. As the internet plays an increasing role in commerce, businesses should track the legal developments in this field. For discussion regarding a 2017 Fourth DCA decision that examines how to incorporate terms and conditions in online sales, see Incorporating Terms and Conditions into Online Sale Agreements.
The Mavrick Law Firm has successfully defended businesses against fraud claims and in non-competition covenant litigation. This article is not a substitute for legal advice tailored to a particular situation. Peter T. Mavrick can be reached at: Website: www.mavricklaw.com; Telephone: 954-564-2246; Address: 1620 West Oakland Park Boulevard, Suite 300, Fort Lauderdale, Florida 33311; Email: peter@mavricklaw.com.