Norm Simon and Samantha Ettari wrote an article for Monday’s edition of the Metropolitan Corporate Counsel magazine regarding how New York’s long-arm statute (§ 302(a)(1)) may give New York courts jurisdiction over non-New Yorkers by merely sending e-mail to someone in New York!
Mr. Simon and Ms. Ettari surveyed a number of recent cases that relate to whether’s New York’s jurisdiction statute gives the state jurisdiction over foreign parties, even where that party’s only contact with New York was by phone, e-mail or other electronic communication.
A leading case cited by the authors is Deutsche Bank Sec., Inc. v. Montana Bd. of Inv. In that case, an out-of-stater used an electronic messenging service to transact a deal with a trader, based in the trader’s home office in New York. Under those facts, the Court of Appeals held that “proof of one transaction in New York is sufficient to invoke jurisdiction, even though the defendant never enters New York, so long as the defendant’s activities here were purposeful and there is a substantial relationship between the transaction and the claim asserted.”
However, recent New York Supreme Court cases have held that e-mail, and even telephone conversations alone will not support New York long-arm jurisdiction without something more. The authors cited one recent case, CPI NA Parnassus B.V. v. Ornelas-Hernandez, Index No. 600997/08 (Sup. Ct. N.Y. Co. Feb. 6, 2009), where a business deal was transacted electronically, but the two out-of-state parties dealt with a third party based in New York. In that case, the court found a sufficient nexus between the transaction from which the litigation arose, the parties, and the state. However, the same judge ruled in Shahidsaless v. Ebadi, Index No. 115835/07 (Sup. Ct. N.Y. Co. Jan. 14, 2009) that one meeting in New York by two out-of-state parties, along with an e-mail exchange between them was not sufficient to establish jurisdiction.
The authors concluded that the courts consider many factors when determining long-arm jurisdiction based on electronic or other contacts with parties in New York. The cases mentioned indicate that small differences in the facts of a situation can make all the difference in ambiguous cases.
As always, you may contact our office with any questions about this or a related matter.
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