In practice, however, actions are likely to arise only in those countries targeted by the website. Thus, web publishers are well advised to have some awareness of the laws in other countries regarding, among other things, defamation and liability for content.

 

In any dispute that crosses national borders, conflict law sets out the rules for determining which country's laws should apply. The main questions for the parties and their lawyers are:

• which country's courts will hear the case?
• which country's laws apply?
• where can the judgment be enforced?
• in which jurisdiction is success most likely?
• in which other relevant jurisdictions can a judgment from the chosen country be enforced?
• are there procedural rules that will help or hinder actions against the defendant?  

Jurisdiction

Internationally, the draft Hague Convention on Jurisdiction and Foreign Judgments in Civil and Commercial Matters outlines a system of rules relating to jurisdiction and cross-border litigation that provide similar enforcement rights for consumers and businesses around the world. The Hague Convention will apply to civil and commercial matters including intellectual property, contractual and tortious disputes. In the absence of express choice between the parties, an online vendor that provides trade or professional services, or directs its activities at consumers may be sued by a consumer in his/her home country. The definition of 'directing an activity' may include a targeted national advertising campaign or filtering access to certain services.

 

Within the European Union (except in the case of Denmark), the Brussels Regulation replaces the Brussels Convention on Civil Jurisdiction and the Enforcememt of Judgments as the guide on jurisdictional matters. The regulation, came into force on March 1 2002. It is "founded on the principle that jurisdiction is generally based on the defendant's domicile". Its provisions are similar to those of the Brussels Convention (subject to exceptions in the case of insurance contracts and greater consumer protection), and its purpose is to ensure that (i) rather than relying on each member state to draft implementing legislation, the same provisions are directly enforceable in each member state, and (ii) the judgment of a court in one member state is easily enforceable in another.

 

The Brussels Convention continues to apply to Austria, Denmark, Iceland, Norway and Switzerland. Its key principle is that a person or company based in a contracting state should bring an action in the defendant's state. However, there are exceptions to this so that (i) contractual disputes may be brought in the courts of the place of performance, and (ii) tortious claims may be brought in the courts of the place whether the harmful event occurred. Parties are also free to contractually agree that the courts of any given country will have jurisdiction to hear a case brought under the contract. In these instances, once an action has begun in one country, the courts in other convention countries should decline to deal with the matter to avoid the same action being brought in multiple jurisdictions.

 

In the United States, if the litigating parties have not agreed on a jurisdiction in advance, the choice of law is generally determined by the 'closest connection test'. This means that where the case involves a contract, the court will examine:

• the place of contracting, negotiation or performance;
• the place of creation of the contract's subject matter; and
• the domicile, residence, nationality or place of incorporation or business of the parties. 

Some commentators argue that the US courts should look instead to competing state government interests so that where two states have an interest in a conflict, the law of the state where the litigation is initiated should apply.

 

Case law

In this selection of cases, the rulings of different courts in different countries give some idea of the multitude of laws and judicial approaches of which online publishers must be conscious.

 

United States

In the case of Playboy Enters Inc v Chuckleberry Publishing Inc, Playboy obtained a judgment prohibiting an Italian company from operating a website using the PLAYMEN mark. The New York court ruled that establishing and operating a website from Italy that was available in the United States violated a previous injunction against the Italian company that prohibited it from doing business in the United States.

 

The Minnesota Supreme Court in the case of Griffis v. Luban held that a Minnesota woman who posted criticism online of an Alabama scholar could not be sued in Alabama. The court reasoned that "nothing in the record indicates that the statements were targeted at the State of Alabama or at an Alabama audience beyond Griffis herself".

 

Germany
In the OLG Bremen Case, a German court ruled that a claim of unfair competition based on illegal online advertising could only be prosecuted in Germany because the advertisement was intended to be effective in Germany and the competitive parties were both active in the German market.

 

In Hit-Bit v AOL, a Bavarian appellate court held an internet service provider (ISP) was liable for infringing material that appeared without its knowledge or permission on a website that it hosted. As a result, ISPs that end up in German courts will not be able to rely on a 'no-knowledge' defence and may need to demonstrate that in hosting copyright-infringing works, they are not acting negligently.

 

In Public Prosecutor v Töben, Germany's Federal Court of Justice ruled that a foreign individual had violated German law when he placed original material denying the Holocaust on an internet server outside Germany but which was accessible to internet users in Germany.

 

Italy
In the first Italian ruling on this issue, an Italian court (Corte di Cassazione) assumed jurisdiction even though the defamatory content was held on a server outside Italy. Under the Italian Criminal Code, crimes can be punished in Italy if either the criminal behaviour or the effect of the crime occurs in whole or in part in Italy. The court ruled that the defamation had effect in Italy since an Italian resident was defamed.

 

In Re Dulberg, a Milan appeals court ruled that it could block access to foreign websites if they failed to comply with Italian defamation laws. The claimant filed a suit against various websites that he claimed violated his constitutional right to privacy. The court held that this case was prosecutable since Italian internet users needed an Italy-based service to view the offending pages. Commentators suggest that this case sets a precedent requiring Italian ISPs to monitor and control the material that is accessible via their websites.

 

 

Applicable law

Applicable law (as opposed to jurisdiction) is governed in the European Union by the Rome Convention, implemented in the United Kingdom by the Contracts (Applicable Law) Act. Parties to a contract have a broad freedom to choose which law should apply. In relation to tortious claims, the basic rule is that the law of the place where the wrong occurs will apply unless there is a substantially more connected law. However, different countries have different rules; since May 1996 the Private International Law (Miscellaneous Provisions) Act has applied to all tort cases in the United Kingdom.

The Rome Convention is being revised to, among other things; permit consumers to choose national law over the law specified in a contract.

 

Enforcement

Within federal states such as Australia, Canada and the United States, reciprocal enforcement of judgments is given by provincial or state courts. However, the situation is different for enforcement between countries. International conventions govern most enforcement situations, but such enforcement may not be relied on in countries that are not parties to such agreements. A claimant may need to commence a new court action in such jurisdictions to be able to adequately enforce its rights.

 

Defamation

One of the major areas of potential liability for website owners, content providers and hosting services alike is defamation. 'Defamation' has been defined as:

"the publication of a statement that reflects on a person's reputation and tends to lower him in the estimation of right-thinking members of society generally or tends to make them shun or avoid him."

Under UK law, a defamatory statement need not be a false one, although the defendant will not be liable if it can establish that the statement was true. Liability for publication extends to the author, editor and publisher of the statement. However, this does not extend to printers, distributors or operators of communications systems that do not have effective control over the content they transmit (such as ISPs), provided that they take reasonable care and had no knowledge of, or reason to believe, that they caused or contributed to the publication of a defamatory statement.

 

Numerous courts have been faced with the problem of deciding when the publication of content online occurs. In Loutchansky v Times Newspapers, the Times argued that Loutchansky's cause of action was out of time and sought to persuade the Court of Appeal to adopt the single publication rule. The court rejected the Times's argument.

 

Since then, the UK Law Commision has suggested a review of the way in which limitation periods are applied to online archives. Additionally, it suggests that the government should reconsider existing laws that force ISPs to shut down websites in response to allegations of defamation, even where the statements are true or in the public interest. Arguably, the problem requires a worldwide solution in the shape of an international treaty and greater harmonization of the law.

 

The case of Georges Tranchant v Gregoire Bardin and Renaud Ranom de la Baume saw the French Supreme Court rule that the three-month limit applicable to publication in the traditional press applies equally to online media. Tranchant argued, and the court agreed, that internet publication amounts to continuous publication, although the court specified that defamation cases must be brought within three months of the first internet publication.

 

Significantly, the New York Court of Appeal in Firth v State of New York rejected Firth's argument that the continued availability of a report on the Internet constitutes repeat republication. The court upheld the single publication rule, in contrast to the European cases above. Central to the US courts' view of the Internet is the constitutional First Amendment right to free speech. The United States has, arguably, the most liberal approach to online content, exemplified in the US case of Ben Ezre, Weinstein & Company v America Online where the court found that the Communications Decency Privacy Act 1996 protected ISPs from liability for distribution of defamatory material or negligently prepared information.

 

Controlling publication

Commentators suggest that there are methods that internet publishers can use to control liability for disseminating online content. In the Gutnick Case, Dow Jones argued that it was technically impossible to block access to subscribers in jurisdictions outside the United States. However, the Australian High Court indicated that attempts to limit access to objectionable content would be looked on favourably by courts in certain circumstances. Where an internet publisher has taken technological steps to prevent publication in certain geographical areas, the courts may accept the defence of innocent dissemination. Some commentators consider that technological filters will become a significant form of protection for publishers.

 

Indeed, in the ongoing saga of the French case of UEJF and Licra v Yahoo! Inc and Yahoo France, the Paris Court of First Instance examined the possibility of using filtering software that can identify the geographical location of internet users. In this case, Yahoo! argued that it was technically impossible to block internet users in France from accessing sites selling Nazi memorabilia. However, the French court noted that Yahoo! was able to use software to identify a user's geographical location and tailor its advertising banners accordingly (e.g., so that they appear in French). Combining such data with a user's statement of nationality may, the court felt, achieve a filtering success rate of approximately 90%.

 

The case was brought under provisions of the French Penal Code that deal with incitement to racial hatred, on the basis that the website was accessible to internet users in France. In the United States, where Yahoo! is based, there is no restriction on advertising Nazi material. The French court gave judgment against Yahoo!, but a United States court then held that the French court had no jurisdiction over the case. The case is now on appeal.

 

Conclusion

Ultimately, it is for the website owner to take a commercial view of whether the cost of obtaining legal advice in a range of jurisdictions will be justified by the reduction in potential legal risk to which it may be exposed. Clearly, the content of the site will be of major relevance, as will the range of countries in which the website owner hopes to generate interest. A simple precaution is to put clear disclaimers on the site listing those countries the website is aimed at or to refuse to accept orders from customers in other jurisdictions.