Summary prepared by Devashish Bharuka
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Tech Heads, an Oregon corporation, is in the business of providing computer-related services, including installation and maintenance of computer hardware, consulting, and training. It advertisers under the service marks TECHEADS and TECH HEADS. It has advertised its services in interstate commerce, including on its Internet web site at www.techheads.com. Tech Heads alleges claims of trademark infringement under the Lanham Act.
Desktop, a Virginia corporation, offers computer-related services including the recruitment and training of individuals with computer operational and consulting skills. Desktop has no physical presence in Oregon, is not registered to conduct business in Oregon, and has n registered agents, employes, or sales representatives in Oregon. It uses the term TECHEAD as a purported service mark in connection with its services. It operates through www.techhead.com and also owns the Internet domain name "techhead.net". Desktop acts as an intermediary in finding employment and screens, interviews, and enters into agreements with individuals submitted resumes to the Web site.
Desktop moved to dismiss the Complaint for lack of personal jurisdiction, asserting that it had not continuous and systematic contacts with Oregon and has not purposefully availed itself of the opportunity to conduct business in Oregon.
Under the Due Process Analysis, the Court held that Tech Heads could
not show the "continuous and systematic" contacts necessary for general
personal jurisdiction. Under specific jurisdiction, the Court analyzed
the case under three heads:
1) Purposeful availment: It is required that Desktop should have taken deliberate aciton within the forum state or has created continuing obligations to forum residents. Tech Head initially seeks to invoke the "effects" test. Court held that Tech Heads has presented no evidence that Desktop intentionally directed its activities at Oregon knowing that TEch Heads would be harmed or that Desktop intentionally targeted Tech Heads itself. Desktop's pre-registration search and lengthy registration process did not reveal the existence of Tech Head's name. Absent some evidence that Desktop intentionally directed its activities at Oregon intending harm to Tech Heads, Tech Heads fails to assert jurisdiction under the "effects" test.
Tech Head also asserted jurisdiction under the traditional "minimum contacts" jurisprudence based on Desktop's Internet web site and related contacts with Oregon. The question is whether jurisdiction is proper when the defendant's Internet web site is the sole or primary contact with the resident forum. Desktop appeared to conduct most of its business through its web site but had little direct contact with Oregon residents. Desktop's web site was certainly interactive. At a minimum, it falls in the middle of the sliding scale requiring further inquiry into the "level of interactivity and commercial nature of the exchange of information" in order to determine whether jurisdiction is proper.
Tech Heads has presented evidence of a highly interactive web site and one actual transaction involving an Oregon resident. Though the actual number of transactions with Oregon is the smallest number possible, "the critical inquiry in determining whethre there was a purposeful availment of the forum state is the quality, not merely the quantity, of the contacts". There is no indication that the actions of the only Oregon resident who had contact with the web site were motivated by this lawsuit. Rather, he submitted a resume to Desktop presumbly because he was aware that Desktop acted as a placement agency. By accepting the resume, Desktop either explicitly or implicitly obligated itself to attempt to find employment for an Oregon resident in the Virginia area. Further, Desktop has purposefully reached out across the United States, including Oregon, and around the world, no only through its web site, but also through national advertising and a toll-free telephone number. All these are commercial activities and Desktop, therfore, should reasonably expect its actions to subject it to jurisdiction in states where its actions cause harm.
Court concluded that Desktop has intentionally availed itself of jurisdiction in Oregon.
2) Claim arising out of defendant's forum-related activities: Tech Head's claims are based on Desktop's unauthorized use of the Tech Heads marks. These marks, or similar marks, are used to identify Desktop's web site and also are used in Desktop's toll-free telephone number. In addition, Desktop's nation-wide newspaper advertising invites job-seekers to contact "Techhead". Therefore, Tech Heads' claoms related to the forum-related contacts in this case.
3) Jurisdiction must comport with fair play and substantial justice: Analysing the various factors involved, the Court concluded that the only factor that may support a finding of unreasonableness is the burden on Desktop of defending in Oregon. This one factor, however, the Court held, was not substantial enough to tip the balance in favor of jurisdiction.
Held, there is personal jurisdiction.