Business-Business e-Commerce

In 1997, a court investigated whether it can be presumed that long-arm jurisdiction is limitless as cyberspace is a realm that has no borders. It also stated that a website that promotes a service or product is essentially intended for a worldwide audience. Cybersell Arizona sued a different company with the moniker of ‘Cybersell Florida’ for trademark violation and unwarranted competition in the state of Arizona. Cybersell Arizona claimed that the Florida Corporation that had been named as ‘Cybersell’ was amenable to individual jurisdiction there since it had made use of the purportedly infringing name on the Internet to market competing services.

Corporate social responsibility should be as stringently enforced against Cybersell Florida when it transacts a significant portion of its business via the Internet

Cyber torts can have an adverse effect on a business if not checked. They have grown increasingly common, as more and more people learn how to perpetuate crimes that are untraceable because of the anonymity offered by the internet. With globalization and multiple developments in Information Technology, extensive use of the internet has ordinarily become a result of the accessibility of reliable, accurate, and constant information on a variety of sources.

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The swift expansion and relevance of internet is also transforming the ways in which criminals operate. The expansive connectivity, pace and accuracy and most significantly, the benefit of anonymity, have spawned new methods of violating an individual’s rights in the world of cyber space, a phenomenon identifiable as a ‘Cyber Tort’. Cyber torts also refer to offences that are committed against the greater society; for instance, Cyber-stalking, Cyber-harassment, Cyber Defamation, Cyber Pornography, E-mail spoofing, unauthorized control/access over computer systems, Internet time thefts, Intellectual Property Crimes and Fraudulent Financial Crimes (Bynum & Rogerson, 2004). Even though cyber torts are serious crimes that have resulted in the damage of many corporations, it is almost impossible to apprehend criminals who are involved in these types of offenses.

The main issue that causes cyber crimes to be so tough to address have to do with the participation of Internet service providers (ISPs). Every Internet contact comes through an ISP. In the future, the issue of the steps that ISPs are ready to take to combat crime might arise. There are already many issues of identity theft and ISP responsibility for problems that have to do with the postings on blogs, which have to be critically examined so that cyber torts can be addressed. The best way to enforce corporate social responsibility is for corporate leaders to make available constant courses in personnel development in the suitable use of internet technology across various offices.

Business organizations could also ensure that their laws define acceptable user/guiding principles that apply to all workers of all departments. They should also make known the unpleasant consequences for any worker that makes use of technology in an unethical manner. This will have a deterrent result, while contributing towards establishing an organizational culture in which the principled use of internet technology is an accepted practice. Organizations can also seek to uphold partnerships with their local school systems in order to teach on the responsible way of employing internet technology. Children are becoming experienced at using computers without internalizing a moral consciousness about the importance of using technology in the right manner.

The Commerce Clause, Article 1, Section 8, Clause 3

The ‘Commerce Clause’ contained in the American Constitution observes that: "The Congress shall have Power . . . To regulate commerce . . . among the several States (U.S. Const., Art. 1, sec. 8, cl. 3) (Buchanan, 2004). The Supreme Court’s Commerce Clause jurisprudence empowers the Federal government to control commerce. In addition, it observes that negative propositions of federal power effect the application of the supposed “dormant Commerce Clause” to stop states from controlling or taxing in a way that would considerably burden or show favoritism against interstate businesses. Where the rule has achieved favor in in-state financial interests over out-of-state operations, it has been perceived as discriminating against commercial activities that are interstate. The Commerce Clause of the American Constitution stops states from ratifying rules that profit in-state trades and discriminate against out-of-state business establishments. As most e-commerce firms usually do away with the intermediary, accordingly affecting conventional state industries, some state laws have safeguarded their regional commerce by ratifying laws under the shadow of the justifications of the public policy. E-commerce traders in businesses tender considerably lower prices than those charged by customary brick-and-mortar traders, and a number of states have passed legislation to shield their domestic industries (Nwete, 2007).

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Torts vs. Cyber Torts

A tort refers to a civil offense that does not originate from any breach of contract; it is a violation of legal duty, which proximately brings harm to another institution or individual. A key resource in determining the outcomes of tort cases is the Restatement of the Law of Torts. Tort law observes that some operations are erroneous for the reason that they bring harm to others. A tort action refers to a civil action in which one individual brings a suit against someone else for the purposes of  getting financial compensation or some other form of relief from injuries suffered that are described as damages. The term ‘Cyber Tort’ simply describes a tort carried out in cyberspace.

The elements of the tort of fraud / misrepresentation and how Cybersell Florida could be prosecuted because of a cyber tort cause of action

The plaintiff, which is a business based in Arizona, claimed that the Florida company that had adopted its name had used it unlawfully in on its web page. A Ninth Circuit court would judge that the utilization of a supposedly infringing trademark on a passive Internet website could not really ascertain personal jurisdiction in the region where the trademark holder, in this case, the company based in Arizona, was situated. Cybersell Florida’s connections with Arizona consisted of its website, which was active only to the level that it encouraged businesses concerned with creating a website to contact it in order to be shown how to go about this. Cybersell Florida did not aggressively search for clients from Arizona in its website. Neither did it exhibit on its website any toll-free number. In addition, it did not acquire any business from Arizona through its website. No prospective clients from Arizona, other than plaintiff, had actually endeavored to contact it. The court ruled that Cybersell Florida’s claims failed to convince the purposeful-availment point of the minimum contacts assessment where the business had not been involved in marketable activities through its website.

The concerns of personal jurisdiction that were raised in the Court were answered in the following way. Arizona will exercise personal jurisdiction over a litigant that is a nonresident of that state to the maximum extent permitted by the national constitution. A court may exercise specific or general jurisdiction. Cybersell Arizona admitted that common jurisdiction over Cybersell Florida is nonexistent in Arizona; therefore, the only problem in this case is whether specific jurisdiction is accessible. It was agreed that there exists a three-part trial for asserting specific jurisdiction:

  1. Conducting an act through which the defendant decisively avails himself or herself of the license to carry out activities in the medium, thus invoking the protections and benefits.
  2. The claim has to be one that arises out of the defendant's activities that are forum-related.
  3. The asserting of jurisdiction has to be practical (American Bar Association, 2013).

The plaintiff in this case stated that infringement of the trademark took place when the name “Cybersell” was made use of in the Internet in association with the function of advertising. The Court claimed that it is fundamental in every case for there to be an act through which the defendant decisively avails himself of the license to carry out activities in the forum state, consequently appealing to the protections and benefits of its regulations.

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Courts that have dealt with cases concerning interactive sites have traditionally looked to the extent of interactivity as well as the marketable nature of the information exchanges that take place in the Web site to decide if enough contacts are present to merit the exercising of the state jurisdiction. In this case, the plaintiff asserted that the simple solicitation or marketing for the sale of services and products on the Internet was enough to provoke the use of specific jurisdiction in the forum of the plaintiff. On further examination, the Court confirmed that Cybersell Florida actually carried out no business activities using the Internet (Tisver, 2008). Additional, it did not have an “800” number that quoted the “Cybersell” moniker. It had consummated no financial transactions, nor had it conducted any activities through which it availed itself of the privilege of the opportunity of conducting business activities in the state of Arizona, and in so doing, summon the protections and benefits of Arizona law. In this case, therefore, the court concluded that Cybersell Florida’s contacts were inadequate in creating “purposeful availment” (Tisver, 2008). 

The most difficult aspect of prosecuting a cybertort against an internet service provider

Internet service providers hold their subscribers in high esteem. For this cause, they have created privacy laws that truly safeguard their subscribers’ private data. It is not easy for prosecutors to recover the necessary data from ISPs’ servers. However, they have made rules concerning the clearance of such information upon a condition of the cyber-crime investigation establishments. In order to decide the gravity of the subpoena appeal, the Internet service providers request that legitimate legal processes take place prior to their being contacted. This is the reason why, to subpoena Internet service suppliers, a court proceeding against the offender is a necessity. All subpoena requests to ISPs should be very particular about what digital information is necessary. ISPs will not simply reveal any requested information (Tisver, 2008).

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