Unspam Technologies, Inc. v. Andrey Chernuk
2013 U.S. App. LEXIS 9070
| 4th Cir. | 2013Background
- Plaintiffs Doe and Project Honey Pot sue four foreign banks for lack of personal jurisdiction related to an alleged global conspiracy to sell illegal prescription drugs online.
- Doe purchased drugs online from Canadian Pharmacy with a US-issued Visa debit card; the drugs never arrived and the bank refunded the purchase.
- Project Honey Pot tracks spam and alleges the network processed spam emails soliciting illegal drugs, including in Virginia.
- Plaintiffs allege Chronopay and six banks processed most of Chronopay’s transactions; four banks remained after others were dismissed.
- District court dismissed Bank Standard, Azerigazbank, Raiffeisenbank, and DnB Nord Banka for lack of jurisdiction; plaintiffs appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court erred in dismissing for lack of jurisdiction. | Plaintiffs rely on conspiracy theory imputing contacts to banks via coconspirators. | No defendant directed activity at Virginia; contacts are too attenuated for jurisdiction. | Affirmed; no constitutionally sufficient contacts or conspiracy basis. |
| Whether a conspiracy theory of jurisdiction can subject banks to Virginia courts. | Conspiracy participants’ contacts can bind coconspirators to jurisdiction. | Conspiracy theory requires plausible facts showing a real conspiracy with forum contacts; not present here. | Rejected; allegations are speculative and fail to show conspiracy-based jurisdiction. |
| Whether Rule 4(k)(2) authorizes jurisdiction over the banks. | If not in state court, US-wide contacts may permit federal jurisdiction. | Even under 4(k)(2), no due process-compliant minimum contacts exist. | Rejected; 4(k)(2) does not apply here. |
Key Cases Cited
- Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945) (establishes minimum contacts required for jurisdictions)
- Hanson v. Denckla, 357 U.S. 235 (1958) (purposeful availment standard)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (purposeful availment to avoid random contacts)
- Calder v. Jones, 465 U.S. 783 (1984) (activity aimed at forum supports jurisdiction)
- ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707 (4th Cir. 2002) (three-part Internet jurisdiction test)
- J. McIntyre Mach., Ltd. v. Nicastro, 131 S. Ct. 2780 (2011) (actions, not expectations, empower jurisdiction)
- Lolavar v. de Santibanes, 430 F.3d 221 (4th Cir. 2005) (conspiracy theory of jurisdiction requires plausible facts)
- First Chicago Int’l v. United Exch. Co., 836 F.2d 1375 (D.C. Cir. 1988) (conspiracy must show overt acts in forum)
- Saudi v. Northrop Grumman Corp., 427 F.3d 271 (4th Cir. 2005) (due process limits under Rule 4(k)(2) and jurisdiction)
- Base Metal Trading, Ltd. v. OJSC 'Novokuznetsky Aluminum Factory', 283 F.3d 208 (4th Cir. 2002) (4(k)(2) analysis framework)
- Base Metal Trading, Ltd. v. OJSC 'Novokuznetsky Aluminum Factory', 283 F.3d 208 (4th Cir. 2002) (4(k)(2) consistency with statutes and constitution)