In Community Trust Bancorp, Inc. v. Community Trust Financial Corporation, the Sixth Circuit recently reversed a finding of personal jurisdiction based on limited internet contacts. The case arose out of a trademark infringement dispute concerning the similarity between the “Community Trust” names and marks. The district court found jurisdiction sufficient based upon the fact that the defendants, with banks operating in Texas, Louisiana and Mississippi, engaged in some internet banking with customers in Kentucky. The Sixth Circuit granted discretionary interlocutory review (for our posts on this practice at the Sixth Circuit, see here and here) in order to explore the scope of personal jurisdiction premised on internet activity.
The Sixth Circuit, in an opinion by Judge Cole, analyzed the issue under federal due process (rather than the long arm statute) and it became a determination of specific, rather than general, jurisdiction. While the Court found that the defendants had engaged in some activity with Kentucky by accepting applications from Kentucky residents and processing them, the Court declined to consider whether such conduct constituted “purposeful availment” in order to satisfy due process because it found that the activities were not substantially connected to the cause of action. In other words, if a handful of Kentucky residents accessed the defendant’s website to engage in online banking, these individuals were not likely to be confused based on the alleged trademark infringement. Therefore, the Court was able to resolve the personal jurisdiction question without the necessity of exploring perhaps the more difficult question of purposeful availment. But this case may certainly influence future cases within the Circuit that implicate similar internet-based claims for personal jurisdiction.