THE CHRISTIAN SCIENCE BOARD OF DIRECTORS OF THE FIRST CHURCH OF CHRIST, SCIENTIST; The Christian Science Publishing Society v. David J. NOLAN; University of Christian Science; David E. Robinson; The Roan Mountain Institute of Christian Science and Health
Nos. 00-2270, 00-2321, 00-2322
United States Court of Appeals, Fourth Circuit
Argued April 6, 2001. Decided July 26, 2001.
259 F.3d 209
Thus, in order to secure an award of costs, the taxpayers were required to satisfy the requirements of
III.
Pursuant to the foregoing, we affirm the Tax Court‘s denial of administrative and litigation costs to the taxpayers.
AFFIRMED.
ARGUED: Brenda Ann Buan, Mahoney, Hawkes & Goldings, L.L.P., Boston, MA, for Appellants. Joseph H. Lessem, Cowan, Liebowitz & Latman, P.C., New York, NY, for Appellees. ON BRIEF: Morris M. Goldings, Mahoney, Hawkes & Goldings, L.L.P., Boston, MA, for Appellants.
Before WILLIAMS, TRAXLER, and KING, Circuit Judges.
Affirmed by published opinion. Judge KING wrote the opinion, in which Judge WILLIAMS and Judge TRAXLER joined.
OPINION
KING, Circuit Judge:
In these appeals, we are asked to evaluate the validity of the exercise of jurisdiction by the district court in the Western District of North Carolina over an Arizona defendant, based on that defendant‘s contributions to a website created and maintained by a North Carolina co-defendant. For the reasons that follow, we conclude that jurisdiction was proper and we affirm the district court.
I.
A.
Founded by Mary Baker Eddy in 1872, The First Church of Christ, Scientist (“TFCCS“), is a Boston-based religious organization with branches located throughout the world. TFCCS is governed by its Board of Directors (the “Board“), whose broad functions include ultimate supervision and control over the church‘s prolific publishing enterprise, The Christian Science Publishing Society. In furtherance of its religious mission, TFCCS provides a variety of products and publications, many of which bear federally registered and common law trademarks owned by the Board.
Defendants David Nolan and David Robinson are active Christian Scientists whose beliefs diverge in significant respects from those espoused and advanced by TFCCS.1 In February 1999, Nolan, a
B.
On July 23, 1999, the Board filed a trademark infringement suit in the Western District of North Carolina against Robinson and Nolan and the two entities with which they were associated, The Roan Mountain Institute of Christian Science (“TRMI“) and UCS, respectively. More specifically, the Board alleged, inter alia, that Nolan and UCS (collectively, the “Nolan Defendants“), without the Board‘s permission, used certain marks belonging to the Board, or marks “confusingly similar thereto,” in printed materials and on the UCS website. The Board also alleged that the Nolan Defendants “have held themselves out as being affiliated with or sponsored by ‘The Official Academic Auxiliary of the Board of Education of the Church of Christ, Scientist.‘” J.A. 30. In the Board‘s view, the Nolan Defendants included the terms “Church of Christ, Scientist” and “Board of Education of the Church of Christ, Scientist” in the content of the website and printed materials, knowing and intending that the use of such terms would likely cause confusion, and would mislead the public into believing that their products and services “emanate from, are approved, authorized or sponsored by, or are in some way associated with the Board and/or TFCCS.” J.A. 31.
Although the Board‘s complaint and summons were promptly served on Robinson and TRMI, service of process on Nolan proved more difficult. After an unsuccessful attempt to effect service by certified mail, pursuant to
As the Nolan Defendants failed to answer or otherwise respond to the Board‘s complaint, the Board moved the district court for entry of default judgment against them.3 By its Judgment (“Default Judgment“) and accompanying Memorandum and Order entered on July 6, 2001, the district court determined that the Nolan Defendants had infringed certain of the Board‘s registered trademarks, in violation of the Lanham Act,
Nolan at last mobilized to oppose the Board‘s motion for an order of contempt, asserting that the Default Judgment was void for lack of personal jurisdiction or, alternatively, for invalid service of process. The district court rejected both of these assertions by order entered on September 20, 2000; two days later, the court addressed the balance of Nolan‘s arguments for Rule 60 relief, concluding that no “exceptional circumstances” were present to justify setting aside the Default Judgment.4 Nolan immediately noticed an appeal to this Court from the September 20, 2000 order, and concurrently moved in the district court to stay enforcement of the injunction pending appeal.
Accordingly, at its September 25, 2000 contempt hearing, the district court considered the Nolan Defendants’ motion for a stay, along with the Board‘s motion to find them in contempt of the Default Judgment. On October 4, 2000, the district court ruled in favor of the Board as to both motions. See Christian Science Bd. of Dirs. of the First Church of Christ, Scientist v. Robinson, 123 F.Supp.2d 965 (W.D.N.C.2000). The district court held, more particularly, that its exercise of per-
II.
A.
The fundamental question on appeal—whether the Nolan Defendants’ contacts with North Carolina were sufficient to support the district court‘s exercise of personal jurisdiction—is a question of law which we review de novo. See Koehler v. Dodwell, 152 F.3d 304, 307 (4th Cir.1998) (citation omitted). It is axiomatic that, in order for a district court to validly assert personal jurisdiction over a non-resident defendant, two conditions must be satisfied. First, the exercise of jurisdiction must be authorized by the long-arm statute of the forum state, and, second, the exercise of personal jurisdiction must also comport with Fourteenth Amendment due process requirements. See, e.g., Stover v. O‘Connell Assocs. Inc., 84 F.3d 132, 134 (4th Cir.1996).
The North Carolina long-arm statute provides, inter alia, for jurisdiction over any validly served defendant who “is engaged in substantial activity within [North Carolina],”
Here, as the district court duly observed, the Nolan Defendants clearly were not engaged in such “substantial” or “continuous and systematic” activities in North Carolina to subject themselves to the district court‘s general jurisdiction. See Christian Science Bd., 123 F.Supp.2d at 974 (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)).5 Our analysis must focus, then, on whether the Board‘s trademark infringement suit
Applying these factors, the district court concluded that the Nolan Defendants had indeed taken “direct actions to create a connection with North Carolina by enlisting Robinson to download their web page design onto his domain, located and maintained in North Carolina,” and then consistently sending information, including solicitations for contributions and sales of merchandise, to Robinson for use on the UCS website. See id. As to the second requirement, there is no dispute that the material drafted and transmitted by Nolan formed the basis for the alleged infringement. Arriving at the third, “reasonableness” inquiry, the district court restated its finding that the Nolan Defendants, through Robinson, had targeted their activities toward North Carolina. The district court characterized the website as an “interactive” one,6 engaged in the transaction of business within North Carolina, and thus concluded that it was proper to subject the Nolan Defendants to the forum‘s jurisdiction.
We agree with the district court that the conditions set forth by the Supreme Court in Burger King regarding the permissible exercise of specific personal jurisdiction are fully satisfied in this case. In challenging the district court‘s decision, the Nolan Defendants strain to argue that the “purposeful availment” condition was absent here, because Nolan neither actively solicited Robinson‘s services nor compensated them. Instead, the Nolan Defendants insist, Robinson volunteered to develop and maintain the offending website—an offer which Nolan “passively” accepted. See Appellants’ Br., at 21. We are unconvinced by the distinction advanced by the Nolan Defendants. A prospective defendant need not initiate the relevant “minimum contacts” to be regarded as purposefully availing himself of the privileges of conducting activity in the forum state. But see Burger King, 471 U.S. at 475 (nonresident defendant may not be “haled into a jurisdiction solely as a result of ‘random,’ ‘fortuitous,’ or ‘attenuated’ contacts, or the ‘unilateral activity of another party or a third person‘“) (citations omitted). Here, it is evident that Robinson‘s invitation was extended within the context of his friendship and ongoing correspondence with Nolan, and that Robinson hoped to assist a fellow Christian Science practitioner disseminate information and, at least prospectively, sell religious products and services.7 Although Nolan was
Having contented ourselves that the Nolan Defendants “purposefully availed” themselves of the privileges of conducting activity in North Carolina, and that the Board‘s claims arise from that activity, we arrive at the third Burger King factor. Although constitutional reasonableness is a somewhat nebulous concept, we are confident that the district court‘s assertion of jurisdiction over the Nolan Defendants comports with “traditional notions of fair play and substantial justice.” See Int‘l Shoe, 326 U.S. at 320. In determining whether jurisdiction is constitutionally reasonable, we may evaluate “the burden on the defendant, the forum State‘s interest in adjudicating the dispute, the plaintiff‘s interest in obtaining convenient and effective relief, the interstate judicial system‘s interest in obtaining the most efficient resolution of controversies, and the shared interest of the several States in furthering fundamental substantive social policies.” See Burger King, 471 U.S. at 477 (internal quotation marks omitted). More generally, our reasonableness analysis is designed to ensure that jurisdictional rules are not exploited “in such a way as to make litigation ‘so gravely difficult and inconvenient’ that a party unfairly is at a ‘severe disadvantage’ in comparison to his opponent.” Id. at 478.
Although defending a lawsuit in North Carolina was, without doubt, inconvenient for Nolan, the inconvenience was not so grave as to offend constitutional due process principles. The Board‘s decision
B.
In their effort to resist the district court‘s jurisdiction, the Nolan Defendants direct our attention to an emerging series of court decisions addressing the extent to which a nonresident defendant‘s website may constitute the sole basis for a court‘s exercise of jurisdiction. Invoking the now-familiar “sliding scale” of interactivity set forth in Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119, 1123 (W.D.Pa.1997)—under which the validity of jurisdiction depends on the “level of interactivity and commercial nature of the exchange of information” of the defendant‘s website—the Nolan Defendants maintain that the UCS website was essentially “passive” and therefore should not expose them to the district court‘s jurisdiction. See Appellant‘s Br., at 23-28. This Court has not addressed the propriety of exercising jurisdiction over a defendant whose only contact with the forum state consists of a website accessible by residents of the forum. While this is an important question—and one which has garnered considerable attention—we need not resolve it in this case, because the Nolan Defendants had specific contacts with North Carolina providing an independent and valid basis for personal jurisdiction.11
III.
Although the Nolan Defendants’ appeals focus primarily on their personal jurisdic-
First, the Nolan Defendants assign error to the district court‘s refusal to set aside the Default Judgment on the grounds that Nolan was never properly served. Unable to serve Nolan personally, the Board sought and received leave of court to serve by publication. Nolan concedes that he received actual notice of the litigation prior to the entry of the Default Judgment, but maintains that the Default Judgment should nevertheless be set aside because service was effected by publication in California, rather than in Arizona. Under
We are similarly unpersuaded by the Nolan Defendants’ contention that they were entitled to Rule 60(b) relief from the Default Judgment entered against them. Given that Nolan was concededly aware of the Board‘s suit, and yet failed to respond or appear prior to the entry of the Default Judgment, we will not disturb the district court‘s denial of Rule 60(b) relief upon its finding that the Nolan Defendants’ neglect was inexcusable.
More substantively, the Nolan Defendants insist that the UCS website did not violate the Lanham Act, and that the district court abused its discretion in denying their motion to stay the injunction pending appeal. After careful consideration, we see no error in the district court‘s conclusion that the Nolan Defendants were unlikely to succeed on the merits “on the issue of whether their conduct falls within that proscribed by the Lanham Act.” See 123 F.Supp.2d at 971. In the circumstances presented, there was no abuse of discretion in the district court‘s ruling.
Finally, the Nolan Defendants challenge the district court‘s entry of the civil contempt order, based on its finding that the Nolan Defendants continued to display infringing marks on the UCS website, in knowing violation of a valid injunction. As we have already concluded, see supra Part II, the Default Judgment was not void for lack of jurisdiction. The Nolan Defendants maintain, however, that modifications to the UCS website, along with the inclusion of a disclaimer disavowing any affiliation with the Board, rendered their conduct noncontemptuous. We must conclude that the district court acted well within its discretion in determining that the website, even as modified, still did not comply with the terms of the Default Judgment, and thus holding the Nolan Defendants in civil contempt.
IV.
For the reasons set forth herein, we affirm the district court‘s order of September 22, 2000, denying the Nolan Defendants’ Motion for Relief from Judgment, and we also affirm its order of October 4, 2000, holding the Nolan Defendants in civil contempt and denying their Motion for a Stay of the Injunction.
AFFIRMED.
Notes
may relieve a party or party‘s legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; ... (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged ...; or (6) any other reason justifying relief from the operation of the judgment[.]
