Jurisdiction of Ohio Courts Over Claims Involving Defamation on the Internet
When can an Ohio resident or business sue a non-resident in an Ohio court for defamatory remarks made on the internet? The Ohio Supreme Court recently addressed this issue in Kauffman Racing Equipment LLC (“KRE”) vs. Roberts.
The defendant, Roberts, a resident of Virginia, purchased an engine block from KRE, which maintains its sole business operations in Ohio although it sells products nationwide. KRE shipped the engine block to Roberts in Virginia, where he substantially modified it, then claimed it was defective. KRE agreed to take the engine block back to inspect it. They found that it was not defective except for Roberts’ modifications. They then shipped it back to Roberts in Virginia. Roberts subsequently posted numerous internet messages claiming that KRE sells defective engine blocks, that its service “…is less than honorable…”, and other derogatory remarks. KRE saw the internet postings as did at least five other Ohio residents who informed KRE about them. KRE filed suit in Ohio against Roberts for defamation and intentional interference with contracts and business relationships.
The legal analysis of when an Ohio court can exercise jurisdiction over a non-resident is complicated. For personal injury actions, jurisdiction can arise either when a non-resident causes injury by some act occurring within the state, or where the claim arises from acts committed outside Ohio with the purpose or the reasonable expectation of injuring persons in Ohio. The Court waded through an obstacle course of prior decisions.
The U.S. Supreme Court case of Calder v. Jones involved Shirley Jones, an actress living in California. She sued Florida residents who were employees of the National Enquirer, a Florida corporation, for defamatory statements made about her having a drinking problem. Although the National Enquirer publishes their paper in Florida, California is the state where it has its largest circulation. The defendants could have anticipated that the article would have a devastating impact on Ms. Jones in California where she lives and works. The court held that jurisdiction in California was appropriate.
Another case decided by the Sixth Circuit Court of Appeals involved Butch Reynolds, an Olympic gold medal-winning track star from Ohio. He brought a defamation claim against the International Amateur Athletic Federation (“IAAF”) for publishing a press release after a Monte Carlo track meet stating that Reynolds had tested positive for banned substances. This was after a drug sample was taken in Monaco and tested in France. The Court held that there was no personal jurisdiction in Ohio because the press release concerned Reynolds’ activities in Monaco, not Ohio, the drug sample was taken in Monaco and the testing done in France, Reynolds was an international athlete whose professional reputation was not centered in Ohio, the press release was not published or circulated by IAAF in Ohio but rather by other agencies, Ohio was not the focal point of the press release, and although Reynolds lost Ohio endorsements and appearance fees, there was no evidence that IAAF knew of them or their Ohio origin.
Neither the Calder nor the Reynolds case involved the internet, but the legal principles are the same. Two cases that did involve the internet are Cadle Co. v. Schlichtmann and Oasis Corp. Cadle was an Ohio-based debt collector working in Massachusetts. Schlichtmann was a Massachusetts resident who created a website to reveal what he believed to be Cadle’s unlawful activities in Massachusetts. The court compared the facts to those in the Calder and Reynolds cases. It declined to assert personal jurisdiction because the alleged defamatory statements were not related to any activities Cadle undertook in Ohio. In Oasis, Oklahoma residents launched a “gripe site” concerning the products of Oasis, an Ohio corporation. They had not purchased any items from Oasis, but were upset that an Oasis water cooler had caused a fire in a building they rented in Oklahoma. Oasis sued in Ohio. The court refused to assert personal jurisdiction because there was no evidence to suggest that the defendants’ communications were received by anyone in Ohio other than Oasis, the alleged defective Oasis water cooler started a fire in Oklahoma not Ohio, Oasis is an international company whose reputation is not centered in Ohio, and the website did not specifically target an Ohio audience.
Returning now to the recently decided case, the Ohio Supreme Court held that the Ohio court had personal jurisdiction with respect to KRE’s claims against Roberts. The reasons were that his statements concerned KRE’s Ohio activities in manufacturing and servicing engine blocks, that KRE’s reputation is centered in Ohio, Roberts’ internet postings were published to Ohio residents by Roberts and not by third parties, there was evidence that at least five Ohio residents read Roberts’ postings, and that one of the focal points of Roberts’ postings was to cause damage to KRE’s reputation and negatively affect its contracts and business relationships in Ohio. It was also noted that Roberts had had commercial dealings with KRE involving Ohio. Since Roberts’ actions allegedly caused injury to KRE in Ohio by acts committed by him outside of Ohio with the purpose of injuring KRE, thereby specifically targeting a known Ohio resident, the Ohio Supreme Court allowed the case to proceed against Roberts in Ohio.
The significance of this decision is that if Ohio businesses or residents are harmed by defamatory remarks posted on websites, blogs, or otherwise on the internet by someone located anywhere else in the world, it may be possible to sue the publisher right here in Ohio. Clearly, each case will be decided on its facts, but the framework for lining up the facts on the side of jurisdiction or against jurisdiction is at least now clearer.