Friday, January 13, 2006
Ninth Circuit Tosses Out Yahoo! Suit Over Nazi Souvenir Sales
By KENNETH OFGANG, Staff Writer/Appellate Courts
The Ninth U.S. Circuit Court of Appeals yesterday ordered dismissal of a declaratory judgment suit by Yahoo! Inc., seeking to block enforcement of French court orders requiring it to stop depicting Nazi symbols and selling Nazi memorabilia on websites that can be accessed by French customers.
A sharply divided en banc panel ruled 6-5 in favor of the defendants, La Ligue Contre Racisme et L’Antisemitisme (the League Against Racism and Anti-Semitism) and L’Union Des Etudiants Juifs De France (the Union of Jewish Students of France). The groups sued in France over sales of Mein Kampf and other books promoting Nazism, as well as the display of Nazi flags, insignia, and the like on Yahoo!’s French web pages.
The ruling overturns U.S. District Judge Jeremy Fogel’s ruling for the Northern District of California. Fogel held that the suit was viable.
The Ninth Circuit, however, left open the central question of whether U.S.-based Internet service providers can be held liiable for damages in foreign courts for displaying content that is unlawful overseas but protected in the United States.
The court not only failed to reach the merits, it was unable to agree on a single rationale for the decision. The majority was made up of three judges who said the district court lacked jurisdiction over the French defendants plus three who agreed with the dissenters that personal jurisdiction existed but concluded the case was not ripe for adjudication.
Judge William Fletcher, joined by Chief Judge Mary M. Schroeder and Judge Ronald Gould, and Judge Raymond C. Fisher, joined by Judges Michael Daly Hawkins, Richard A. Paez, Carlos Bea, and Richard Clifton, wrote that the district court had jurisdiction.
Those judges reasoned that the two groups had subjected themselves to the jurisdiction of California courts with respect to the specific subject matter. They noted that the groups had sent a cease and desist letter to Yahoo! at its headquarters in Santa Clara, and had served process on Yahoo! to commence the French suit and served the French court orders on Yahoo!, all at the headquarters location.
“It is a close question whether LICRA and UEJF are subject to personal jurisdiction in California in this suit,” Fletcher wrote. “But considering the direct relationship between LICRA and UEJF’s contacts with the forum and the substance of the suit brought by Yahoo!, as well as the impact and potential impact of the French court’s orders on Yahoo!, we hold that there is personal jurisdiction.”
Fletcher went on to conclude, however, that the case is not ripe because Yahoo! failed to show a likelihood that the orders would ever be enforced in this country. He noted that “Yahoo! voluntarily changed its policy to comply with them, at least to some extent,” and said there was “some reason to believe that the French court will not insist on full and literal compliance with its interim orders, and that Yahoo!’s changed policy may amount to sufficient compliance.”
The groups, he noted, had made no efforts to enforce the French court’s rulings here.
“Alternatively, if Yahoo! has not “in large measure” complied with the orders, its violation lies in the fact that it has insufficiently restricted access to anti-semitic materials by Internet users located in France. There is some possibility that in further restricting access to these French users, Yahoo! might have to restrict access by American users. But this possibility is, at this point, highly speculative. This level of harm is not sufficient to overcome the factual uncertainty bearing on the legal question presented and thereby to render this suit ripe.”
Judge Diarmuid F. O’Scannlain, Senior Judge A. Wallace Tashima, and Senior Judge Warren Ferguson concluded that there was no personal jurisdiction over the French defendants in California.
Fisher, dissenting, said he found the majority’s views “perplexing.” The actions of the French groups, he said, represented a direct effort to impose a prior restraint on the free speech of an American company and was repugnant to U.S. public policy.
Attorneys on appeal included Randol Schoenberg of the Los Angeles firm of Burris & Schoenberg for the French defendants, Robert C. Vanderet of O’Melveney & Myers for Yahoo!, and Ann Brick of the ACLU’s San Francisco office for the American Booksellers Foundation for Free Expression as amicus in support of Yahoo!
The Chamber of Commerce of the United States, represented by lawyers in Jenner & Block’s Washington, D.C. office, filed an amicus brief supporting Yahoo!
The case is Yahoo! Inc. v. La Ligue Contre Racisme et L’Antisemitisme, 01-17424.
Copyright 2006, Metropolitan News Company