Shopify Ruling Could Expand Forums for E-Commerce Litigation, Lawyers Say
The 9th U.S. Circuit Court of Appeals' recent decision in Briskin v. Shopify, Inc. (see 2504210030) could be used to expand potential forums for any e-commerce-related litigation, said Wiley lawyers in a blog post Friday.
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Case 22-15815, which 9th Circuit judges allowed to continue, alleges the e-commerce company extracted sensitive personal information, including financial data, without consent or knowledge, from the plaintiff, who was making a purchase through Shopify's platforms. The U.S. District Court for Northern California had previously granted Shopify's motion to dismiss in May 2022 for failure to prove jurisdiction.
The Wiley lawyers said that in deciding the district court had jurisdiction, the 9th Circuit issued three determinations. First, it found that while Shopify operates nationally, it purposefully directed wrongful behavior toward California. Additionally, "the court found that the plaintiff’s claims arose from or related to Shopify’s California conduct," which also meant "it is reasonable to exercise specific personal jurisdiction over Shopify under the circumstances."
"In so holding, the court acknowledged but dismissed concerns that its finding 'could lead to specific jurisdiction in all 50 states,' stating that while that may be true, it is not unfair," said the lawyers' blog post. "Likewise, the court dismissed the company’s argument that the availability of other potential forums mattered -- declaring that the availability of those other forums did not render jurisdiction in California unfair."
The Wiley lawyers said the 9th Circuit analysis may have "serious implications" for any e-commerce platforms that operate in the U.S., but particularly those in the 9th Circuit. The blog said e-commerce platforms need to be mindful of this, and consider other possible arguments in the event that they face litigation.
"Pursuant to the court’s reasoning, an e-commerce platform may subject itself to personal jurisdiction simply by making its services available to consumers in a particular location, even if that location is not a focus of the platform," the lawyers said. "Critically, as the court acknowledged, this could subject e-commerce platforms to lawsuits across the country regardless of where they are incorporated and/or headquartered."