The internet has made available to the consumer the world of retail right in their own home. No longer does a shopper have to do battle at the mall for a parking space or traverse crowded walkways and listen to lousy mall music. Just log on to the various websites offering goods to the ready willing and able consumer with a debit or credit card at the ready. Such shopping convenience is available 24/7.
However, such convenience is not without its perils. A consumer enters into a contract with a vendor just by clicking on “submit order” with the cursor of the mouse. So what does a consumer do if what was bargained for is not what is actually delivered? Recently the U.S. 9th Circuit Court of Appeals stated a federal district court in Northern California properly decided it didn’t have jurisdiction to require a Wisconsin classic car seller abide by this state’s consumer protection laws.
Paul Boschetto, a car collector and enthusiast, offered the winning bid of $34,106 for a 1964 Ford Galaxie 500 XL auction by Wisconsin sellers who stated the vehicle in their EBay posting was “in awesome condition, not restored, rust free chrome in excellent condition, recently rebuilt ready to be driven.”
Per Boschetto’s testimony to the federal district court, the engine would not start, the body was dented and the chrome rusty.
Boschetto notified EBay and the seller to rescind the contract but to no avail. Boschetto subsequently filed suit in federal court alleging violation of California’s Consumer Protection Act, breach of contract, misrepresentation and fraud.
Seller/defendants filed a motion to dismiss with the District Court of Northern California, arguing that the court lacked jurisdiction over an out of state seller. The court concurred and dismissed the case in July of 2006.
Upon appeal the 9th Circuit held that since the sellers weren’t specifically aiming to sell in California, the transaction in this matter was not subject to state law.
The Court of Appeal further stated the mere fact that Boschetto was in California was insufficient “to establish jurisdiction over a nonresident defendant.” Additionally, the Court stated “something more” has to be involved to establish jurisdiction, such as individually targeting residents of a particular state, for a seller to be subject to the laws of that state.
The 9th Circuit’s decision concurs with other federal rulings of recent, inferring that the courts do not want to monitor and police internet commerce. A federal court in New York declined to order EBay administrators to ensure that counterfeit high end items , such as designer knock offs like Tiffany Jewelry are not sold on their site in violation of copyright protections.
A 9th circuit decision held that it would not apply the “Erie Doctrine” of “traditional notions of fair play and substantial justice” in claiming jurisdiction over internet commerce in which the only contact with a state’s legal framework was that the seller’s website was accessible to the state’s consumers. This present interpretation by the courts leaves consumers such as Buschetto getting the raw end of the deal, in that Buschetto paid $34,106 for a vehicle maybe worth $1,500.
The moral of this story, the burden is on the buyer to make absolutely sure what they get is actually what they had originally bargained for.
~Matthew Hintlian
Law Offices of Vincent W. Davis & Associates
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