The Facebook, Inc. v. Connectu, LLC et al

Filing 118

Supplemental Authority in Opposition to Motion to Dismiss for Lack of Personal Jurisdication 90 , filed by Mark Zuckerberg, The Facebook, Inc. (Attachments: # 1 Exhibit Travel Jungle# 2 Exhibit Verizon v. Ralsky# 3 Exhibit Mary CLE v. First Choice Internet# 4 Exhibit Washington v. Heckel# 5 Exhibit Internet Doorway v. Parks# 6 Exhibit Gordon v. Virtumundo# 7 Exhibit D.C. Micro Dev. v. Lange# 8 Exhibit Robert Diaz Enters. v. Elete# 9 Exhibit Flowserve Corp. v. Midwest Pipe Repair)(Related document(s) 90 ) (Chatterjee, I.) (Filed on 7/19/2007) Modified on 7/19/2007 to conform to document caption post by counsel (bw, COURT STAFF).

Download PDF
The Facebook, Inc. v. Connectu, LLC et al Doc. 118 Att. 3 Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 1 of 21 Page 1 LEXSEE MARYCLE, LLC, ET AL. v. FIRST CHOICE INTERNET, INC., ET AL. No. 2321, September Term, 2004 COURT OF SPECIAL APPEALS OF MARYLAND 166 Md. App. 481; 890 A.2d 818; 2006 Md. App. LEXIS 2 January 26, 2006, Filed PRIOR HISTORY: Appeal from the Circuit Court for Montgomery County. Durke G. Thompson, JUDGE. DISPOSITION: [***1] JUDGMENT OF THE CIRCUIT COURT FOR MONTGOMERY COUNTY REVERSED. CASE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. COSTS TO BE PAID BY APPELLEE. COUNSEL: ARGUED BY: Michael S. Rothman of Rockville, MD. FOR APPELLANT. ARGUED BY: Andrew M. Dansicker (Schulman, Treem, Kaminkow, Gilden & Ravenell, PA on the brief) all of Baltimore, MD. FOR APPELLEE JUDGES: ARGUED BEFORE: Salmon, Adkins, Barbera, JJ. OPINION BY: Adkins OPINION [**821] [*487] Opinion by Adkins, J. This case requires us to consider how established law governing personal jurisdiction and the Commerce Clause applies in cyberspace. Asserting claims for both monetary and injunctive relief, appellants MaryCLE, LLC (MaryCLE) and NEIT Solutions, LLC (NEIT) filed suit against appellees First Choice Internet, Inc. and Joseph Frevola, the president of First Choice, in the Circuit Court for Montgomery County. Appellants maintained that appellees, whom we designate as "First Choice," 1 violated the Maryland Commercial Electronic [*488] Mail Act ("MCEMA"), Md. [**822] Code (1975, 2005 Repl. Vol.), 14-3001 et seq. of the Commercial Law Article (CL), by sending them 83 unsolicited false and misleading commercial emails. 1 Although we generally refer to First Choice Internet, Inc. and its president, Frevola, collectively as "First Choice," in some contexts we shall distinguish between the corporation and the individual. Similarly, we refer to appellants collectively as "MaryCLE," but also sometimes refer to each appellant separately. [***2] First Choice responded by filing a "Motion to Dismiss, or Alternatively, Motion for Summary Judgment," alleging that (1) MCEMA violates the "dormant Commerce Clause" of the United States Constitution, (2) the circuit court lacked personal jurisdiction over First Choice and Frevola, (3) Frevola could not be sued individually, and (4) First Choice had not violated MCEMA. After a hearing, the circuit court granted the motion to dismiss and issued a written opinion in which it ruled that (1) MCEMA violates the "dormant Commerce Clause" of the U.S. Constitution as applied in this case, (2) Maryland lacks personal jurisdiction over First Choice and Frevola, and (3) no cause of action was stated against Frevola individually. In doing so, the circuit court considered affidavits submitted by the parties. Accordingly, we treat the motion as one for summary, judgment as required by Md. Rule 2-322(c). As discussed in detail below, we shall reverse because we conclude that personal jurisdiction over First Choice is proper and that MCEMA as applied in this case does not offend the Commerce Clause. We also determine that there were material disputed facts concerning the individual liability of [***3] Frevola that rendered the grant of summary judgment in his favor erroneous. See Md. Rule 2-501. FACTS AND LEGAL PROCEEDINGS The Parties MaryCLE, LLC (pronounced "miracle"), an acronym for "Maryland Consumer Legal Equity," describes itself as a "consumer protection firm" that "protects con- Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 2 of 21 Page 2 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** sumers wronged [*489] by online . . . marketers[.]" 2 MaryCLE was founded by Eric Menhart, who at the time of the proceedings below, was a third-year law student at the George Washington University Law School. MaryCLE maintains a website on which it states its mission to "protect[] consumers via promotion of responsible marketing practices, mediation, and litigation." First Choice, on the other hand, describes MaryCLE as a company that set up Internet email accounts to receive emails from Internet marketing companies . . . and, when it received a substantial number of email solicitations, [] contacted the targeted marketing company and demanded a substantial payment as "settlement" of its statutory damages claims under MCEMA in return for MaryCLE's promise not to file a lawsuit[.] Although MaryCLE is registered in Maryland and has a Maryland mailing address, [***4] which is Mr. Menhart's home address in Adelphi, Maryland, the complaint and MaryCLE's own website and letterhead list its principal place of business as Washington, D.C. One of the email addresses "registered to and used by MaryCLE" is emj at 3 2 On review of a motion for summary judgment, we resolve all factual inferences against appellees, as the moving parties. See Merchants Mortgage Co. v. Lubow, 275 Md. 208, 217, 339 A.2d 664 (1975). This summary of facts reflects that standard. 3 "EJM" are Mr. Menhart's initials. NEIT Solutions, LLC is an interactive computer service provider ("ISP") that provides internet services, including the hosting of web space and use of email addresses, to MaryCLE. NEIT is a registered Maryland limited liability company [**823] that is located in Frederick, Maryland, although its computer servers are located in Colorado. First Choice is an Internet marketing company based in New York that describes its purpose as "promoting products [***5] for various third-party customers through 'opt-in' email mailings and promotions[.]" Joseph Frevola, who lives in New York, is the President of First Choice. [*490] Background Before the events in this case began, First Choice entered into a partnership agreement with a company called Wow Offers, LLC. 4 Wow Offers supplied First Choice with email addresses of people who had allegedly "opted-in" to Wow Offers' services. First Choice asserts that ejm at was registered on a website called, which in turn provided that email address to Wow Offers. First Choice engaged the services of Master Mailings, LLC, 5 to send promotional emails, including those at issue in this case, to the email addresses obtained through Wow Offers. First Choice alleges that Master Mailings is located in Virginia. 6 4 Wow Offers, LLC is not a party to this action. 5 Master Mailings, LLC is not a party to this action. 6 We can find no affidavit or other support for this contention in the record. [***6] MaryCLE denies signing up for any "optin" services through or in any other way giving the email address ejm at to Wow Offers or First Choice. Nevertheless, on September 18, 2003, First Choice sent an email to MaryCLE at that address. The "From" line of the email indicated that the sender was "Exceptional Deals," with an email address of promotions at The "Subject" line of the email was "Interest Rates are at a 36 Year low - Act Now." Although the email contained an "unsubscribe" link as well as a postal mailing address to which requests to be removed from the email list could be sent, MaryCLE did not avail itself of the "unsubscribe" option. Instead, it attempted to "Reply" to the email and requested to be removed from the mailing list. The reply was returned to MaryCLE as "undeliverable." MaryCLE did not send any written communications to the postal address contained in the email. Instead, for reasons not explained in the record, MaryCLE attempted to find a street mailing address for "Exceptional Deals" through the [*491] United States Postal Service. The Postal Service indicated that it had no address for "Exceptional [***7] Deals." MaryCLE then utilized the free "WHOIS" feature on, a website on which any member of the public can find contact information for the registrants of domain names. 7 After entering the domain "," MaryCLE obtained Mr. Frevola's name, as well as an email and mailing address for First Choice. MaryCLE attempted to contact First Choice using this [**824] email address, but this email was also returned as "undeliverable." MaryCLE did not attempt to contact First Choice by postal mail at this point. Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 3 of 21 Page 3 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** 7 A "domain name" is the "address of a computer network connection . . . that identifies the owner of the address," or ISP, such as "" or "" See The American Heritage Dictionary of the English Language, 4th ed. 2000, (last visited Jan. 13, 2005). See also Verizon Online Servs., Inc. v. Ralsky, 203 F. Supp. 2d 601, 605 (E.D. Va. 2002)("Subscribers use the ISP's domain name, . . . together with their own personal identifier to form a distinctive e-mail mailing address"). [***8] By September 30, 2003, MaryCLE had received an additional 23 emails from First Choice. MaryCLE maintains that it replied to each email with a request to be removed from the mailing list, but each time the reply was returned as "undeliverable." MaryCLE next visited the First Choice website, On this site, MaryCLE found a working email address and phone number. MaryCLE sent an email to the email address, joe at, 8 and left a voice mail at the phone number to inform First Choice that it did not wish to receive further emails. This email was not returned as undeliverable, which led MaryCLE to conclude that an email had finally been received by First Choice. MaryCLE's phone message was not returned. 8 We assume this to be the email address of Mr. Frevola. Despite these efforts, MaryCLE continued to receive 59 additional emails throughout the month of October, at a rate [*492] of approximately two per day. MaryCLE maintains that all 83 of the emails it received were [***9] opened in either Maryland or Washington, D.C. Examples of subject lines from these emails include "Urgent: Claim Now or Forfeit" and "Confirmation # 87717." MaryCLE asserts that it replied to every email, and each time its reply bounced back as "undeliverable." At no time, however, did MaryCLE click on the "unsubscribe" link located within the emails or send any written requests via postal mail to be removed from the mailing list. MaryCLE explains that it did not do so because "'unsubscribe' links are notoriously unreliable, and have been recognized by many to be a method via which marketers collect 'live' e-mail addresses to be resold to other marketers." On October 28, 2003, MaryCLE sent a second email to joe at, and for the first time followed up with a letter sent via postal mail to Frevola. The letter was entitled "Notification of Violation of Maryland Law." 9 On October 29, 2003, the emails to MaryCLE ceased. On November 10, 2003, Mr. Frevola sent MaryCLE a letter in which he stated that MaryCLE's email address had been removed from First Choice's mailing list and that First Choice had ceased all of its mailings indefinitely. 9 This letter is not contained in the record. [***10] Court Proceedings On December 31, 2003, MaryCLE and NEIT filed suit against First Choice and Frevola in the Circuit Court for Montgomery County. They alleged two counts for statutory damages under the Maryland Commercial Electronic Mail Act, and one count for injunctive relief. Before filing an answer, First Choice and Frevola filed a "Motion to Dismiss or, Alternatively, Motion for Summary Judgment," and MaryCLE filed a response. See Md. Rule 2-322(a). A hearing was held on October 13, 2004, and on December 9, 2004, the circuit court entered an order granting the motion to dismiss. [*493] Relying on the Maryland long arm statute, the circuit court determined that First Choice had not caused tortious injury in Maryland. Nor had it "regularly conducted business, engaged in persistent conduct or derived revenues from Maryland." See Md. Code (1974, 2002 Repl. Vol. 2005 Cum. Supp.), 6-103(b)(3)-(4) of the Courts and Judicial Proceedings Article [**825] (CJP). 10 The circuit court also declared that the exercise of personal jurisdiction over First Choice would violate its right to due process, because First Choice "did not intentionally direct their emails to the Plaintiffs in Maryland [***11] because the Defendants did not even know, and had no ability to know, where the Plaintiffs would actually open the email." The court explained that the geographic options were limitless. The email addresses of MaryCLE are connected to a computer registered in Virginia, MaryCLE's principal place of business is in Washington, D.C. and MaryCLE is a registered Maryland corporation. The Defendants had no way of knowing whether MaryCLE would receive its email in Virginia, D.C., Maryland, or any other state for that matter. Thus, the Defendants did not "purposely" direct their emails to Maryland residents. 10 In 2000, the General Assembly added subsection (c) to Md. Code (1975, 2005 Repl. Vol.), section 6-103 of the Commercial Law Article Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 4 of 21 Page 4 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** (CL), which states that its provisions apply to "computer information and computer programs in the same manner as they apply to goods and services." "Computer information" is defined in CL section 22-102 as "information in electronic form which is in a form capable of being processed by a computer." [***12] In considering the constitutionality of MCEMA, the circuit court explained that, "on its face, [the] language [of MCEMA] does not discriminate against residents from other states." It determined, however, that, "when the language is applied to the case at bar it does violate the dormant Commerce Clause because the law crosses state boundaries to reach persons who open their email in other states." Id. (emphasis added). The court reasoned that First Choice "had no contact with the State of Maryland because their emails were sent from New York, routed through Virginia and Colorado, [*494] and finally were received in Washington, D.C." It explained that MCEMA violates the Commerce Clause because it regulates conduct occurring wholly outside Maryland borders. The statute does not provide that the email must be received in Maryland, instead the statute pertains to situations where an email sender in one state[] sends an email to a Maryland resident living or working in another state. Thus, the statute, as applied in this case, seeks to regulate the transmission of commercial email between persons in states outside of Maryland, even when the email never enters Maryland, [***13] as long as the recipient is a Maryland resident. (Emphasis added.) I. Did the circuit court err when it determined that Maryland lacks personal jurisdiction over First Choice and Frevola? II. Did the circuit court err when it determined that, as applied in this case, the Maryland Commercial [**826] Electronic Mail Act violates the Commerce Clause of the U.S. Constitution? 11 [*495] III. Did the circuit court err when it determined that Mr. Frevola could not be held personally liable for the statutory [***14] violations alleged by MaryCLE? 12 Because we conclude that jurisdiction is proper and that this application of MCEMA does not offend the Commerce Clause, we will reverse the grant of summary judgment in favor of First Choice. We also reverse the circuit court's order granting summary judgment in favor of Frevola. 11 The circuit court decided the constitutional issue first, and then addressed jurisdiction "to further substantiate" its ruling. We will address the jurisdictional question first, for if we have no jurisdiction, then the constitutional issue is not properly before us. See, e.g., Curran v. Price, 334 Md. 149, 171, 638 A.2d 93 (1994) ("If a decision on a constitutional question is not necessary for proper disposition of the case, we will not reach it"). 12 MaryCLE framed the issues in a different manner: I. Whether the trial court erred, as a matter of law, when it granted Appellees' Motion to Dismiss and found the MCEMA violative of the dormant Commerce Clause because it regulated conduct occurring wholly outside of Maryland and unduly burdened interstate commerce, even though the MCEMA applied by its very terms only to entities who send spam to Maryland residents. II. Whether the trial court erred, as a matter of law, when it held that Maryland could not exercise personal jurisdiction over Appellees because they did not purposefully direct their electronic The circuit court finally ruled that Frevola had no personal liability for the alleged MCEMA violations. It reasoned that, under Maryland law, an officer of a corporation can only be held personally liable for a tort if he "specifically directed the particular act to be done or participated or co-operated therein." Shipley v. Perlberg, 140 Md. App. 257, 265-66, 780 A.2d 396, cert. denied, 367 Md. 90, 785 A.2d 1293 (2001). The court decided, as a matter of law, that Mr. Frevola "did not specifically direct First Choice to send an email to MaryCLE or to any Maryland residents." QUESTIONS PRESENTED MaryCLE poses three questions for our review: Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 5 of 21 Page 5 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** mail to Maryland residents, despite the fact that the Complaint clearly stated the facts essential to the exercise of jurisdiction and the court made its own independent, unsupported findings of fact regarding Appellees' connections to Maryland without allowing jurisdictional discovery. III. Whether the trial court erred, as a matter of law, when it held that Appellee Frevola could not be held personally liable for fraudulent and misleading email sent to Petitioners although the Complaint clearly stated Frevola's personal involvement in sending the spam and the court was required to assume the truth of all well-pleaded facts contained in the complaint, as well as the logical inferences that flow from those allegations. quickly become one of the most popular forms of advertising over the Internet, as well as one of the most bothersome." Verizon Online Servs., Inc. v. Ralsky, 203 F. Supp. 2d 601, 606 (E.D. Va. 2002). 13 Federal legislation to control the proliferation of unwanted email also exists. In 2003, Congress passed the "Controlling the Assault of NonSolicited Pornography and Marketing Act of 2003" ("CAN-SPAM Act"), which became effective January 1, 2004. See 15 U.S.C. 7701 et seq. This law expressly supercedes all state regulation of email "except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto." 15 U.S.C. 7707(b)(1). The circuit court determined that because the federal law specifically reserves to states the right to control fraudulent and deceptive emails, which the Maryland statute does, the analysis in this case should focus on MCEMA. Neither party disputes this approach, and thus we also focus on the Maryland Act. [***17] 14 The term "spam" originates from a skit by the British comedy troupe Monty Python, in which a group of Vikings, singing about the Hormel Foods meat product SPAM, "sang a chorus of 'spam, spam, spam . . . ' in an increasing crescendo, drowning out other conversation. Hence, the analogy applied because [spam email] was drowning out normal discourse on the Internet." Spam and the Internet, (last visited Jan. 16, 2006). See also Beyond Sys., Inc. v. Realtime Gaming Holding Co., LLC, 388 Md. 1, 16 n.12, 878 A.2d 567 (2005)(spam can be either commercial or noncommercial). 15 Because not all spam is UCE, and because MCEMA only regulates UCE, we will be cautious in our use of these terms throughout this opinion. MCEMA provides that a person may not "initiate," "conspire to," or "assist in" the "transmission of commercial electronic mail" either from a computer within Maryland or to an email address "that the sender knows or should have known is held by a resident of" Maryland, if the mail "contains false or misleading information" [***18] about either the origin or transmission path of the email, see CL 14-3002(b)(2)(ii), 16 or "in the subject line" of the email, see 14-3002(b)(2)(iii). "Commercial electronic mail" is defined as "electronic mail that adver- [***15] DISCUSSION Standard Of Review Whether the circuit court erred in granting summary judgment in favor of First Choice and Frevola is a question of law that we review on the same record as the motion court, to determine if its decision was legally correct. See Heat & Power Corp. v. Air Prods. & Chems., Inc., 320 Md. 584, 591, [*496] 578 A.2d 1202 (1990). Summary judgment is proper where there is no dispute as to any material fact and the moving party is entitled to judgment as a matter of law. See Md. Rule 2-501. The Maryland Commercial Electronic Mail Act The Maryland Commercial Electronic Mail Act ("MCEMA," or "the Act") was passed by the Maryland General Assembly in 2002, and became effective October 1 of that year. 13 See CL 14-3001 et seq. The Court of Appeals has recognized that [**827] this statute was passed "to curb the dissemination of false or misleading information through unsolicited, commercial e-mail, as a deceptive business practice." Beyond Sys., Inc. v. Realtime Gaming Holding Co., LLC, 388 Md. 1, 16, 878 A.2d 567 (2005). At the time of its enactment, 21 other states had enacted laws [***16] to curb the proliferation of "spam" 14 email, or "UCE" (unsolicited commercial email). 15 See id. "Spam is [*497] the twenty first century version of junkmail and over the last few years has Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 6 of 21 Page 6 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** tises real property, goods, or services for sale or lease." 14-3001(b)(1). 16 In this section, unless otherwise noted, all citations to statutory sections refer to the Commercial Law Article. The Act contains a presumption that the sender of UCE knows the recipient is a Maryland resident "if the information is available on request from the registrant of the Internet domain name contained in the recipient's electronic mail address." 14-3002(c). The statutory damages allowed by the Act are the greater of $ 500 or actual damages to the recipient of the email, and the greater of $ 1000 or actual damages to the ISP. See 143003(1) and (3). The Act also provides for the recovery of reasonable attorneys' fees. See 14-3003. [***19] I. Personal Jurisdiction A. Constitutional Framework The question of whether a Maryland court can exercise personal jurisdiction over an out-of-state defendant starts with a two-part inquiry. See Beyond Sys., 338 Md. at 14. "First, we consider whether the exercise of jurisdiction [*498] is authorized under Maryland's long arm statute," which is CJP section 6-103. Id. "Our second task is to determine whether the exercise of jurisdiction comports with due process requirements of the Fourteenth Amendment" of the Federal Constitution. Id. at 15. With respect to this two-part test, Maryland [**828] courts "have consistently held that the purview of the long arm statute is coextensive with the limits of personal jurisdiction set by the due process clause of the Federal Constitution." Id. Thus, "our statutory inquiry merges with our constitutional examination." Id. at 22. In order to pass constitutional muster under the Due Process Clause, the defendant must have "minimum contacts" with Maryland such that our exercise of jurisdiction "does not offend 'traditional notions of fair play and substantial [***20] justice.'" Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95 (1945)(citation omitted). "It is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities" within Maryland. Hanson v. Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 1240, 2 L. Ed. 2d 1283 (1958). While the "nature" of the defendant's contacts with Maryland are important, Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416-17, 104 S. Ct. 1868, 1872-73, 80 L. Ed. 2d 404 (1984), we must additionally consider "the relationship among the defendant, the forum, and the litigation," Shaffer v. Heitner, 433 U.S. 186, 204, 97 S. Ct. 2569, 2580, 53 L. Ed. 2d 683 (1977), to determine whether the defendant "should reasonably anticipate being haled into court" in Maryland. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S. Ct. 559, 567, 62 L. Ed. 2d 490 (1980). Generally, there are two types of jurisdiction: "specific" and "general." 17 "If the defendant's contacts with [Maryland also] form the basis for the [***21] suit," then Maryland courts have specific jurisdiction. Beyond Systems, 388 Md. at 26. [*499] "If the defendant's contacts . . . are not the basis for the suit," then the defendant must have "continuous and systematic" contacts with Maryland such that we may exercise general jurisdiction. Id. at 22 (citations omitted). 17 The Court of Appeals has explained that sometimes cases do not fit "neatly" into one category or the other. See Camelback Ski Corp. v. Behning, 312 Md. 330, 338-39, 539 A.2d 1107, cert. denied, 488 U.S. 849, 109 S. Ct. 130, 102 L. Ed. 2d 103 (1988)("Camelback II"). If this is the case, then there is no need to jettison the concept, or to force-fit the case. In that instance, the proper approach is to identify the approximate position of the case on the continuum that exists between the two extremes, and apply the corresponding standard, recognizing that the quantum of required contacts increases as the nexus between the contacts and the cause of action decreases. Id. at 339. [***22] Because First Choice's email contacts with Maryland also form the basis of this suit, our analysis will be focused on whether Maryland can exercise specific jurisdiction over First Choice. 18 The Court of Appeals has adopted the Fourth Circuit's three-part test for determining whether specific jurisdiction exists: In determining whether specific jurisdiction exists, we consider (1) the extent to which the defendant has purposefully availed itself of the privilege of conducting activities in the State; (2) whether the plaintiffs' claims arise out of those activities directed at the State; and (3) whether Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 7 of 21 Page 7 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** the exercise of personal jurisdiction would be constitutionally reasonable. Id. at 26 (citing Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 397 (4th Cir. 2003)). We [**829] will discuss each prong of this test, and its application to First Choice, in the sections that follow. 18 Neither party specifically addresses the type of jurisdiction that would or would not be appropriate here, although MaryCLE's argument more closely resembles one for specific jurisdiction. [***23] B. The Parties' Contentions MaryCLE's argument in favor of personal jurisdiction boils down to the allegation that "sending 'hundreds of thousands' [*500] of commercial email messages would lead any rational marketer to believe that his messages would be received and read by residents in most any state in the nation." MaryCLE analogizes First Choice's email contacts with Maryland residents to "traditional mail, telephone calls, or even advertisements placed in a newspaper," which it contends Maryland courts have found to be sufficient contacts to meet jurisdictional requirements. MaryCLE further points out that, under the terms of MCEMA, the sender of a commercial email is presumed to know that the recipient of the email is a resident of Maryland if the information about the holder of the email account is available upon request from the domain name registrant. See CL 14-3002(c). Referring to free searches available on websites such as, MaryCLE explains that the domain name registry for "" contains a Maryland address. First Choice, on the other hand, maintains in its brief that there is [***24] no way of knowing where the owner of an email address resides or where he might open up his email. It argues that the fact that it could have found out that "" was registered in Maryland does not mean that it "knew that the emails would be received in Maryland[.]" At oral argument, First Choice conceded that it knew some emails would be opened in Maryland, but insisted that, because its emails were being distributed across the country, it was not purposefully availing itself of any particular jurisdiction. C. Jurisdiction Over First Choice Is Proper In Maryland This case amply demonstrates that "each new development in communications technology brings new challenges to applying the principles of personal jurisdiction." Verizon Online, 203 F. Supp. 2d 601, 604 (E.D. Va. 2002). See also McGee v. Int'l Life Ins. Co., 355 U.S. 220, 222-23, 78 S. Ct. 199, 201, 2 L. Ed. 2d 223 (1957)(recognizing that advances in communications [*501] and technology have expanded the "permissible scope of personal jurisdiction"); Hanson, 357 U.S. at 250-51, 78 S. Ct. at 1238 ("As technological progress has increased [***25] the flow of commerce between States, the need for jurisdiction over nonresidents has undergone a similar increase"); World-Wide Volkswagen, 444 U.S. at 293, 100 S. Ct. at 565 (observing that, since McGee, "historical developments" have further relaxed the limits of due process). Maryland state appellate courts have not had many opportunities to consider the application of personal jurisdiction law to cases concerning email and the Internet. Beyond Systems involves both, but is quite unlike this case. 19 Indeed, at oral argument, [**830] each party acknowledged that, because of the factual differences, Beyond Systems did not advance its arguments here. In the absence of an analogous email case, we will apply the three-part test adopted in Beyond Systems, 20 see 338 Md. at 26, using three cases decided by other courts to help shape our reasoning. 19 In Beyond Systems, the Court of Appeals affirmed the Circuit Court for Montgomery County's dismissal of an MCEMA-based lawsuit on the grounds that the defendants did not have sufficient minimum contacts with Maryland. Beyond Systems, 388 Md. at 28. Unlike First Choice, the defendants in Beyond Systems did not direct the sending of the allegedly MCEMAviolative emails, and the connection between the sender of the email and the defendants was distant and tenuous. These contacts are markedly more attenuated than those in this case, and thus Beyond Systems is not particularly instructive, beyond its statement of the general principles. [***26] 20 The circuit court relied on a more specific personal jurisdiction test for cases involving the Internet, articulated by the Fourth Circuit in ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707 (4th Cir. 2002). Under this test, a State may, consistent with due process, exercise judicial power over a person outside of the State when that person (1) directs electronic activity into the State, (2) with the manifested intent of en- Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 8 of 21 Page 8 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** gaging in business or other interactions within the State, and (3) that activity creates, in a person within the State, a potential cause of action cognizable in the State's courts. Id. at 715. We conclude that the result is the same no matter which of these tests is applied. [*502] 1. The Reasoning Of Three Other Courts In a case in which the defendant corporation sent one commercial email to the plaintiff, a Utah resident, the Court of Appeals of Utah decided that the one email was sufficient to warrant the exercise of personal jurisdiction in a cause of action for violation of Utah's commercial [***27] email statute. See Fenn v. MLeads Enters., Inc., 2004 UT App 412, 103 P.3d 156, 164 (Utah Ct. App. 2004), cert. granted 109 P.3d 804 (Utah 2005). The Utah court, considering that the Utah long arm statute (like Maryland's) extends as far as the limits of due process, found that the defendant "directed its agent [a marketing company] to solicit business, and that direction instantiates the purpose that makes the connection more than an 'attenuated nexus.'" Id. at 162 (citation omitted). The court further determined that, even though the sender of the email did not know where geographically the email was opened, it was reasonable for the defendant to expect to be haled into court "wherever its emails were received." Id. Finally, the court concluded that Utah had an interest in "preventing its residents from receiving noncompliant email" and that this interest, among others, outweighed the burden placed on the outof-state defendant. See id. at 163-64. The U.S. District Court for the Southern District of Mississippi reached a similar conclusion in a case in which the defendant sent an unsolicited email to people "all over the world, including [***28] Mississippi residents, advertising a pornographic web-site." See Internet Doorway, Inc. v. Parks, 138 F. Supp. 2d 773, 774 (S.D. Miss. 2001). The defendant altered the email so that it appeared to have been delivered from an email address held by the plaintiff corporation. See id. The corporation complained that the emails caused it to suffer damages in the form of losing goodwill in the community and expending time and resources in responding to the complaints of people who received the offensive email. Applying the Mississippi long arm statute, which is similar to Maryland's, the court determined: [*503] When [the defendant] allegedly transmitted the e-mail to a recipient or recipients in Mississippi, it was an attempt to solicit business for a particular website. Thus, [the defendant] committed a purposeful act that occurred in Mississippi, just as if she had sent via United States Mail a letter to a Mississippi resident [**831] advertising a particular product or service. Id. at 776. The federal court went on to explain that, in sending emails all over the world, the defendant "had to have been aware that the e-mail would be received [***29] and opened in numerous fora, including Mississippi." Id. at 779. Thus, it was fair for Mississippi to exercise personal jurisdiction. By sending an e-mail solicitation to the far reaches of the earth for pecuniary gain, one does so at her own peril, and cannot then claim that it is not reasonably foreseeable that she will be haled into court in a distant jurisdiction to answer for the ramifications of that solicitation. Id. at 779-80. The U.S. District Court for the Eastern District of Virginia has also decided that email solicitations can constitute the basis for the exercise of personal jurisdiction. See Verizon Online Servs. Inc. v. Ralsky, 203 F. Supp. 2d 601, 622-23 (E.D. Va. 2001). In Verizon Online, the court considered the defendants' argument that they had not purposefully availed themselves of the laws of Virginia because they did not know, or have any way of knowing, that they were sending commercial emails to Virginia residents or through a server located in Virginia. See id. at 612. In a carefully reasoned opinion, the court found that the emails were "knowing and repeated commercial [***30] transmissions" that the defendants knew would be routed through Verizon's servers in Virginia because the defendants sent their emails to Verizon-based domain names. See id. at 617-18 (citations omitted). When the defendants compared their emails to the placement of an item in the stream of commerce, which a plurality of the Supreme Court has rejected as the sole basis for the [*504] exercise of jurisdiction, see Asahi Metal Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 112, 107 S. Ct. 1026, 1032, 94 L. Ed. 2d 92 (1987), the federal court rejected the argument. In its view, "defen- Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 9 of 21 Page 9 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** dants' conduct and connections to Virginia were of their own choosing, not someone else's . . . They cannot seek to escape answering for these actions by simply pleading ignorance as to where the servers were physically located." Id. at 620. The court further concluded that, considering Virginia's interests in adjudicating the claim, which was filed by a Virginia corporation under a Virginia statute governing email use, jurisdiction was constitutionally reasonable. See id. at 621-22. We find the reasoning of these three cases instructive, and rely on them in performing [***31] our analysis under the three-part inquiry adopted by the Court of Appeals in Beyond Systems. 21 21 We have found that other cases in which emails have not served as a sufficient basis for personal jurisdiction are easily distinguishable from this case and therefore not instructive. See, e.g., Burleson v. Toback, 391 F. Supp. 2d 401, 421-22 (M.D.N.C. 2005)(email from defendant to plaintiff insufficient for personal jurisdiction where plaintiff had not shown relationship between email and claim asserted, or that email created the cause of action); Bible & Gospel Trust v. Wyman, 354 F. Supp. 2d 1025, 1031 (D. Minn. 2005)(email not authorized by out-of-state defendant but received by him and forwarded to Minnesota resident was not sufficient contact for exercise of jurisdiction); Hydro Eng'g, Inc. v. Landa, Inc., 231 F. Supp. 2d 1130, 1135-36 (D. Utah 2002)(in a libel suit, there was no proof that emails were received in Utah to constitute "publication" in Utah, so exercise of jurisdiction was improper); Reliance Nat'l Indem. Co. v. Pinnacle Cas. Assurance Corp., 160 F. Supp. 2d 1327, 1333 (M.D. Ala. 2001)(emails not sent to Alabama residents but forwarded to them were insufficient for exercise of jurisdiction). [***32] [**832] 2. Claim Arising Out Of Forum Activities We begin with the second factor, as it is the simplest. "If a defendant's contacts with the forum state are related to the operative facts of the controversy, then an action will be deemed to have arisen from those contacts." Compuserve, Inc. v. Patterson, 89 F.3d 1257, 1267 (6th Cir. 1996). Here, the "connection to [Maryland] is the claim [*505] itself - the transmission of [email] to Maryland residents." Verizon Online, 203 F. Supp. 2d at 620. MaryCLE's claims are based upon First Choice's action in sending emails to MaryCLE in Maryland. Thus, First Choice's alleged contacts with Maryland are related to the "operative facts" of this case. In other words, "but for [First Choice's] alleged transmission of this spam," MaryCLE and NEIT "would not have suffered an injury." Id. at 621. This requirement for personal jurisdiction is therefore met. 3. Purposeful Availment We next address the first factor, purposeful availment. The Supreme Court has emphasized that the "quality and nature" of the defendant's contacts are critical to the question of purposeful availment. Hanson, 357 U.S. at 253, 78 S. Ct. at 1240. [***33] Looking to the quality and nature of First Choice's contacts, we observe that First Choice admits that it sent "hundreds of thousands" of email advertisements to recipients all over the country. First Choice contends that, although it sent emails everywhere, it did not purposefully avail itself of "the privilege of conducting business in Maryland." We disagree. This argument resembles the one made in WorldWide Volkswagen, 444 U.S. at 295, 100 S. Ct. at 566, that "foreseeability" that a product would cause injury in another state was insufficient for jurisdiction. In WorldWide Volkswagen, the Supreme Court did conclude that "mere" "foreseeability" that a product (in that case, an automobile), would "find its way into the forum State" was not enough on its own to exercise jurisdiction. See id., 444 U.S. at 297, 100 S. Ct. at 567. It cautioned, however, that jurisdiction could be proper when "the defendant's conduct and connection with the forum State" rendered it foreseeable that he might be expected to answer for his actions in that State. 22 See id. 22 Several years later, a plurality of the Supreme Court clarified the meaning of World-Wide Volkswagen. See Asahi Metal Indus. Co. v. Superior Ct. of Cal., 480 U.S. 102, 112, 107 S. Ct. 1026, 1032, 94 L. Ed. 2d 92 (1987). The plurality rejected cases decided after World-Wide Volkswagen that interpreted it to mean that jurisdiction could be founded on the foreseeability that a product would enter other states because of its placement in the stream of commerce. See id., 480 U.S. at 111, 107 S. Ct. at 1032. The plurality determined that, because the exercise of jurisdiction requires that the defendant have purposefully directed some action towards the forum, "the placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State." Id., 480 U.S. at 112, 107 S. Ct. at 1032. The plurality did advise, however, that jurisdiction could be justified if "additional conduct of the defendant [] indicates an intent or purpose to serve the market in the forum State, for example . Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 10 of 21 Page 10 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** . . advertising in the forum State, . . . or marketing the product through a distributor[.]" Id. Four justices disagreed and joined in the opinion of Justice Brennan, who wrote separately to explain their belief that World-Wide Volkswagen does in fact stand for the proposition that foreseeability that a product would enter another state through the stream of commerce is, by itself, enough for jurisdiction. See id. at 116-21 (Brennan, J., concurring in part and concurring in the judgment). Justice Brennan reasoned that the stream of commerce refers not to unpredictable currents or eddies, but to the regular and anticipated flow of products from manufacture to distribution to retail sale. As long as a participant in this process is aware that the final product is being marketed in the forum State, the possibility of a lawsuit there cannot come as a surprise. Id., 480 U.S. at 117, 107 S. Ct. at 1034 (concurring opinion). [***34] [*506] [**833] First Choice's emails did not merely "find [their] way" into Maryland the way a car, sold in one state by the defendant, might find its way to another because the plaintiff drove it into another state. See id. Rather, First Choice directly caused the emails to be sent to Maryland, among other states. It is thus reasonable for First Choice to expect to answer for those emails in Maryland, or any other state to which they were sent. See Fenn, 103 P.3d at 162; Internet Doorway, 138 F. Supp. 2d at 776. The Court of Appeals has explained that there is a difference between a merchant who purposefully "sends a product" into another jurisdiction and one that simply receives business from another state. In Camelback Ski Corp. v. Behning, 312 Md. 330, 340-41, 539 A.2d 1107, cert. denied, 488 U.S. 849, 109 [*507] S. Ct. 130, 102 L. Ed. 2d 103 (1988)("Camelback II"), the Court elaborated: [A] significant difference exists between regularly placing goods into a stream of commerce with knowledge they will be sold in another state on the one hand, and knowingly accepting the economic benefits brought by [***35] interstate customers on the other hand. Ordinarily, one who purposefully sends a product into another jurisdiction for purposes of sale may reasonably expect to be haled into court in that State if the product proves to be defective and causes injury there. In addition to having caused a direct injury within the forum State, that manufacturer or distributor has purposefully availed himself of the laws of the forum State that regulate and facilitate such commercial activity. The same cannot be said of the fixed-site merchant who is simply aware that a portion of his income regularly is derived from the patronage of customers coming from other states . . . Although he may cause an indirect impact on the forum State by injuring one of its residents, he causes no direct injury in the State, and does not avail himself of the protection or assistance of its laws. (Emphasis added.) The Court in Camelback II concluded that jurisdiction was not proper. See id. at 343. The defendant in Camelback II, however, was a "fixed-site" ski resort whose limited contacts with Maryland included mailing brochures to Maryland ski shops upon the request of the Maryland [***36] shops. 23 See id. at 341. [**834] In contrast, First [*508] Choice reached out to other jurisdictions, including Maryland, by sending their uninvited advertisements there. 24 23 Camelback's other "involvement" with Maryland included awareness that others, for their own economic purposes, were publicizing the Camelback resort within the Washington and Baltimore metropolitan areas; that wire services routinely carried information concerning snow conditions on its slopes and that this information was reproduced in Maryland newspapers; that Maryland residents could, and probably were, using a toll-free telephone number to obtain information concerning snow conditions at the resort[.] Camelback II, 312 Md. at 341. None of this "involvement" constitutes attempts by the resort itself to reach out to Maryland residents. Indeed, Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 11 of 21 Page 11 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** the Camelback II Court indicated that Camelback rejected Maryland as a target for its business: Camelback did not devote its energy or financial resources to the marketing of Maryland. It allocated no part of its advertising budget to Maryland, and following one very brief and unsuccessful attempt to solicit business in this State in 1982, it abandoned any attempt to include Maryland in its primary marketing area, or to conduct any active solicitation here. Id. [***37] 24 Although First Choice alleges that MaryCLE "opted-in" to its mailings, at this juncture we must view the parties' contentions in the light most favorable to MaryCLE as the non-moving party. See Faya v. Almaraz, 329 Md. 435, 443, 620 A.2d 327 (1993). MaryCLE pleaded that it never submitted its email address to or First Choice. Additionally, unlike Camelback II and World-Wide Volkswagen, the emails themselves were the product. First Choice made its money by the very act of identifying email account holders nationwide, and transmitting emails from one state to residents of other states, including Maryland. Without the information identifying email addresses and transmittal to those addresses, First Choice had no product. In contrast, Camelback's product was a ski resort located in Pennsylvania, and World-Wide Volkswagen's product was a car sold to a New York customer in New York, and driven by the customer to Oklahoma, the forum in which the plaintiff tried to sue for injuries allegedly caused by a defect in the car. We also reject [***38] First Choice's claim that jurisdiction is not proper because, even if it knew where the recipients reside, it had no idea where the emails would be opened. This allegation has little more validity than one who contends he is not guilty of homicide when he shoots a rifle into a crowd of people without picking a specific target, and someone dies. See Digital Equip. Corp. v. AltaVista Tech., Inc., 960 F. Supp. 456, 469 n.27 (D. Mass. 1997)(likening the sending of advertisements via the Internet to a gunman "repeatedly firing a shotgun into a crowd across the state line, not aiming at anyone in particular, but knowing nonetheless that harm in [*509] the forum state may be caused by its actions outside it"). Cf. Charles E. Moylan, Jr., Criminal Homicide Law 3.25 (MICPEL 2002)("Where a wide-ranging lethal attack is unleashed, even though its primary intended target is a single person in the killing zone or target area, there may be a murderous mens rea with respect to all persons who are also coincidentally in the line of fire. . . . There is a concurrent murderous intent directed towards all who are in harm's way"). In Digital Equipment, a trademark [***39] infringement case, the federal court reasoned that jurisdiction was proper because, where the case involves torts that create causes of action in a forum state . . . the threshold of purposeful availment is lower. The defendant allegedly causing harm in a state may understandably have sought no privileges there; instead the defendant's purpose may be said to be the targeting of the forum state and its residents. Digital Equip., 960 F. Supp. at 469 (emphasis added). First Choice's purpose in sending commercial emails was likewise the targeting of its email recipients, who included Maryland residents. In sum, First Choice cannot plead lack of purposeful availment because the "nature" of the Internet does not allow it to know the geographic location of its email recipients. See Verizon Online, 203 F. Supp. 2d at 620. Rather, when considering the "nature" of First Choice's contacts, our focus should be on the fact that the emails are communications specifically and deliberately designed to convince the recipients to engage the services of First Choice and to promote the products of its [**835] customers. Although First Choice did not [***40] deliberately select Maryland or any other state in particular as its target, it knew that the solicitation would go to Maryland residents. Its broad solicitation of business "instantiates the purpose that makes the connection more than an 'attenuated nexus,'" and thus it should be subject to jurisdiction "wherever its emails were received." Fenn, 103 P.3d at 162 (citations omitted). [*510] 4. Constitutional Reasonableness We also conclude that the exercise of jurisdiction over First Choice would be constitutionally reasonable. To determine what is reasonable, we look to several factors: the forum State's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief . . ., Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 12 of 21 Page 12 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** the interstate judicial system's interest in obtaining the most efficient resolution of controversies[,] and the shared interest of the several States in furthering fundamental substantive social policies. World-Wide Volkswagen, 444 U.S. at 292, 100 S. Ct. at 564 (citations omitted). The Supreme Court has asserted that, once purposeful availment has been established, a defendant must make a "compelling case" that [***41] it is unreasonable or unfair to require it to defend a suit out of State. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477, 105 S. Ct. 2174, 2184-85, 85 L. Ed. 2d 528 (1985). First Choice contends that the burden on it to comply with MCEMA is too great because there is no way to know where the emails will be received. It disputes MaryCLE's contention that it can discover the location of the email recipient by looking up the domain name registrant's address on searches such as the one available on, explaining that in cases where the domain is a common one, such as "hotmail," it is impossible to figure out where an individual recipient of an email would be located. We reject First Choice's argument for two reasons. First, while it might be impossible to determine the location of an email recipient in cases of common domain names such as "hotmail," in this case that is not true. MaryCLE has demonstrated that a search on indicates that "" is, unsurprisingly, registered in Maryland. Second, we reject First Choice's approach to analyzing the "burden" imposed on it. The burden of complying with [***42] MCEMA [*511] is to disseminate truthful, non-deceptive emails; it is not to determine the location of email recipients. See Washington v. Heckel, 143 Wn.2d 824, 24 P.3d 404, 411 (Wash.), cert. denied, 534 U.S. 997, 122 S. Ct. 467, 151 L. Ed. 2d 383 (2001)(discussed infra in Section II). First Choice remains free to send emails into Maryland so long as it does not violate the truth requirements of MCEMA. This is not a great burden to meet. First Choice attempts to distract us from the real burden here - sending only truth - by arguing that it is impossible to determine residency or location of receipt. "This focus on the burden of noncompliance" misses the point. See id. at 411; see also Ferguson v. Friendfinders, Inc., 94 Cal. App. 4th 1255, 1265, 115 Cal. Rptr. 2d 258 (Cal. Ct. App. 2002)(rejecting argument that burden imposed by UCE statute to determine residency is too great; concluding that real burden is to comply with statute's substantive terms). Turning to Maryland's interest in adjudicating this dispute, we observe that MCEMA was passed largely because the [**836] financial and social burden of UCE on Maryland consumers is great. Maryland certainly [***43] has an interest in protecting its consumers, not only from the costs associated with UCE proliferation, but also from becoming the victims of fraud and schemes initiated by false and misleading email. Cf. Verizon Online, 203 F. Supp. 2d at 621-22 ("Virginia has a strong interest in resolving this dispute because it involves a Virginia resident and Virginia law. Indeed, Virginia recently enacted [a computer crime statute] to specifically address the conduct Defendants are accused of committing"); Heckel, 24 P.3d at 411 (state has a legitimate interest in creating a penalty for sending false and misleading spam to its residents). Additionally, as the State of Maryland and the United States Internet Service Provider Association ("US ISPA") point out in the amici briefs filed in this case, the financial costs of spam and UCE are great. 25 To this effect, a recent [*512] University of Maryland study concluded that deleting unwanted email costs nearly $ 22 billion annually in lost productivity. See National Survey Finds 22.9 Million Hours a Week Wasted on Spam, visited Jan. 16, 2006). Congress has similarly concluded [***44] that "spam would cost corporations over $ 113 billion by 2007." S. Rep. No. 108-102 (2003), (last visited Jan. 16, 2006). The costs associated with spam or UCE can largely be explained by the time and effort that must be expended to delete it. Each unwanted email that a recipient attempts to respond to "instantly becomes three separate e-mail messages (and additional computer log entries)[.]" Heckel, 24 P.3d at 410 n.8. This is because: (1) the ISP server that is the victim of the fraudulent return address or domain name sends an error message back to the Internet user and their ISP announcing that the return path was invalid, (2) a message is sent to the server administrator requesting an investigation of the return address for potential problems, and (3) a message is sent to the server log in case the ISP wishes to track down the problem later. Id. With mass mailings such as those sent by First Choice, "these messages snowball to clog ISP resources, and ISPs have little choice but to purchase additional equipment at a significant cost." Id. The cost is then passed onto [***45] consumer subscribers of Internet Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 13 of 21 Page 13 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** services. See also Heckel, 24 P.3d at 409-11 (detailing the costs associated with spam); Ferguson, 94 Cal. App. 4th at 1267-68 (same); 15 U.S.C. 7701(a)(Congressional findings for the CAN-SPAM Act on the costs associated with spam). 25 Again, we observe that not all spam is UCE. With respect to MaryCLE's interest in obtaining relief, we similarly conclude that Maryland is the appropriate forum. MaryCLE has a financial interest in recovering for the injury it allegedly suffered and has also asserted a claim for injunctive relief. Maryland is the state in which MaryCLE [*513] suffered that injury. 26 The Supreme Court has reasoned that jurisdiction is proper in the state in which "the brunt of the injury would be felt[.]" 27 [**837] Calder v. Jones, 465 U.S. 783, 78990, 104 S. Ct. 1482, 1487, 79 L. Ed. 2d 804 (1984). First Choice is aware that by sending potentially false and misleading emails, any injuries caused [***46] by those emails would be felt in the state in which they were received, rather than the state from which they were sent. See Verizon Online, 203 F. Supp. 2d at 617-18, 621-22. 26 Although it admits that some of the emails were opened in Washington, D.C., MaryCLE alleged that some were opened in Maryland at Mr. Menhardt's residence. Further, NEIT Solutions, MaryCLE's ISP, is a Maryland corporation located in Maryland. 27 This case, along with Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 104 S. Ct. 1473, 79 L. Ed. 2d 790 (1984), establish what has become known as the Supreme Court's "effects test" in personal jurisdiction cases. See Verizon Online, 203 F. Supp. 2d at 613. Under this approach, jurisdiction is proper if the "brunt of the injury," or the effects of the defendant's wrongful conduct, is felt most in the forum State. See Calder v. Jones, 465 U.S. 783, 789-90, 104 S. Ct. 1482, 1487, 79 L. Ed. 2d 804 (1984). Regarding the interstate [***47] judicial system's interest in obtaining the most efficient resolution of controversies, we conclude that because this claim is based on a Maryland state statute, the most efficient locus for the suit is Maryland itself. As we explained above, the Maryland legislature created a private cause of action to further the state's financial and social goals in reducing the number of deceptive emails sent here. The interstate judicial system has an interest in Maryland adjudicating this claim because it seeks to enforce a Maryland prohibitory statute. Maryland courts can do so most efficiently because they are familiar with the Maryland statute. We also consider that there is no showing in the record that this is a case in which the defendant will be required to bring numerous witnesses from another state. See Burger King, 471 U.S. at 483, 105 S. Ct. at 2188. This is simply not a case in which defending the suit in Maryland is "'so gravely difficult and inconvenient' that [First Choice] unfairly is at a 'severe disadvantage' in comparison" to MaryCLE, or a disadvantage [*514] of "constitutional magnitude." Id., 471 U.S. at 476, 484, 105 S. Ct. at 2185, 2188. [***48] Finally, we look at the shared interest of the several states in furthering fundamental substantive social policies. In doing this aspect of the analysis, we consider whether there might be a potential conflict between two states' social policies that would impact the exercise of jurisdiction. See Burger King, 471 U.S. at 477, 105 S. Ct. at 2185. We observe that New York has no commercial email or spam statute; thus, there is no potential conflict with respect to the two states' "social policies." See David E. Sorkin, Spam Laws, (information verified through Mar. 20, 2005)(last visited Jan. 16, 2006). If we were to accept First Choice's argument that jurisdiction is not proper in Maryland because it is impossible to determine the residency of an email recipient, that would be equivalent to saying that First Choice could only be sued in New York. While certainly New York courts are capable of adjudicating a suit based entirely on a Maryland statute, limiting jurisdiction to New York does not promote Maryland's social policies or efficiency, particularly when the alleged harm occurs in Maryland. Applying similar reasoning, [***49] the federal court in Verizon Online commented that jurisdiction is proper in the state in which the harm is suffered, especially considering that many states have enacted antispam laws: Permitting Defendants to escape personal jurisdiction simply because they claim they were unaware that Verizon's email servers were located in Virginia would be fundamentally unfair. Setting such a precedent would allow spammers to transmit UBE 28 ] with impunity and only face suit if the injured party had [**838] the resources to pursue the litigation where the tortfeasor resides rather than where the injury occurred. . . . Allowing the spammer to evade personal [*515] jurisdiction in the forum where their conduct causes the greatest harm would frustrate [anti-spam] laws. Case 5:07-cv-01389-RS Document 118-4 Filed 07/19/2007 Page 14 of 21 Page 14 166 Md. App. 481, *; 890 A.2d 818, **; 2006 Md. App. LEXIS 2, *** statute on both local and interstate activity." BrownForman Distillers, 476 U.S. at 579, 106 S. Ct. at 2084. In several cases [***52] applying the Pike test, the Supreme Court has invalidated statutes on the grounds that their "extraterritorial effect" rendered them unconstitutional. 29 See Jack L. Goldsmith & Alan O. Sykes, The Internet and the Dormant Commerce Clause, 110 Yale L.J. 785, 804-06 (2001)(examining cases and commenting on extraterritoriality jurisprudence). In Healy v. Beer Institute, 491 U.S. 324, 336-37, [**839] 109 S. Ct. 2491, 2499-2500, 105 L. Ed. 2d 275 (1989)(plurality opinion), the Supreme Court explained its extraterritoriality jurisprudence: The principles guiding [an extraterritoriality] assessment, principles made clear in Brown-Forman and in the cases upon which it relied, reflect the Constitution's special concern both with the maintenance of a national economic union unfettered by state-imposed limitations on interstate commerce and with the autonomy of the individual States with their respective spheres. Taken together, our cases concerning the extraterritorial effects of state economic regulation stand at a minimum for the following propositions: First, the "Commerce Clause . . . precludes the application of a state statute to commerce [***53] that takes place wholly outside of the State's borders, whether or not the [*517] commerce has effects within the State" . . . . Second, a statute that directly controls commerce occurring wholly outside the boundaries of a State exceeds the inherent limits of the enacting State's authority and is invalid regardless of whether the statute's extraterritorial reach was intended by the legislature. The critical inquiry is whether the practical effect of the regulation is to control conduct beyond the boundaries of the State. Third, the practical effect of the statute must be evaluated not only by considering the consequences of the statute itself, but also by considering how the challenged statute may interact with the legitimate regulatory regimes of other States and what effect would arise if not one, but many or every, State adopted similar legislation. Generally speaking, the Commerce Clause protects against inconsistent legislation arising from the projection of one state regulatory regime into the jurisdiction of Verizon Online, 203 F. Supp. 2d at 622. 28 "UBE" is "unsolicited bulk email." Because we determine that all three parts of the jurisdictional test are met, we conclude that personal jurisdiction over First Choice is proper. [***50] Our next step is to examine First Choice's challenge to MCEMA under the Commerce Clause of the Federal Constitution. II. The Commerce Clause A. Constitutional Framework The Commerce Clause, U.S. Const., art. I, 8, cl. 3, empowers Congress "to regulate Commerce with foreign Nations, and among the several States." "The Clause is both an affirmative grant of legislative power to Congress and an implied limitation on the power of state and local governments to enact laws affecting foreign or interstate commerce." Bd. of Trs. of the Employees' Ret. Sys. of Baltimore City v. Mayor and City Council of Baltimore, 317 Md. 72, 131, 562 A.2d 720 (1989), cert. denied, 493 U.S. 1093, 110 S. Ct. 1167, 107 L. Ed. 2d 1069 (1990)(citations omitted). "The aspect of the Commerce Clause which operates as an implied limitation upon state and local government authority is often referred to as the 'dormant' or 'negative' Commerce Clause." Id. In Pike v. Bruce Church, 397 U.S. 137, 142, 90 S. Ct. 844, 847, 25 L. Ed. 2d 174 (1970), the Supreme Court established a two-part inquiry for determining whether a state statute violates the dormant [***51] Commerce Clause. A reviewing court must first decide whether "the statute regulates evenhandedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental[.]" Id. See County Comm'rs of Charles County v. Stevens, 299 Md. 203, 208, 473 A.2d 12 (1984). In Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth., 476 U.S. 573, 579, 106 S. Ct. 2080, 2084, 90 L. Ed. 2d 552 (1986), the

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?