Suggestions for E-Commerce

Because obtaining personal jurisdiction over out-of-state individuals and businesses can be difficult, and collecting a winning judgment may be even tougher, here are some practical suggestions for dealing with e-businesses:

• Use credit cards for purchases whenever possible. For purchases over $50 that you make within your home state, credit card companies have a dispute resolution procedure that bypasses litigation -- and pesky personal jurisdiction problems. Check the back of your credit card statement for information about your card company's policies.
  
  
• Investigate the other party before taking legal action to see if facts justify suing in your state. For example, check with your state's secretary of state to determine if the company is licensed to do business in the state and check to see if the business has a physical presence in your state, as would be true if it operates a warehouse, store, or office. If so, it will be easy to establish personal jurisdiction. If your investigating shows few contacts, it may not be worth pursuing the matter in your state.
  
  
• If you enter into significant contracts with out-of-state companies, try to avoid contract provisions that require you to waive personal jurisdiction in your state or require that you submit yourself to jurisdiction in a distant state.
  
  
• If your dispute is substantial (more than $25,000) and personal jurisdiction is unclear, consider hiring a lawyer and filing a lawsuit in the cyber-defendant's home state. It may prove more efficient than battling over jurisdiction and later attempting to collect an out-of-state judgment.