Hotel reservation website gave rise to personal jurisdiction in California

The California Supreme Court has weighed in on the perennial Internet law issue of when a defendant is subject to personal jurisdiction in another state based on the activities of its website. In the case of Snowney v. Harrah’s Entertainment, Inc. et al., decided on June 6, 2005, the court determined that the out-of-state defendants’ website was sufficient to establish personal jurisdiction in California.

Plaintiff Snowney filed a class action lawsuit in California against a group of defendants who owned and operated hotels in Nevada. Snowney complained that the defendants had, without providing proper notice, charged a $3 energy surcharge to each person who made a hotel reservation. None of the defendants conducted business in California or had bank accounts there. Among their many marketing activities, however, the defendants maintained a website through which visitors could obtain room quotes and make reservations. Moreover, the website “touted the proximity of the hotels to California” and provided driving directions from California.

The defendants had claimed that the California courts could not exercise personal jurisdiction over them, and the trial court agreed, quashing the summons. The appellate court, however, reversed the trial court and the matter went to the California Supreme Court which held that the defendants’ website, especially in conjunction with the defendants’ other marketing activities, was sufficient to give rise to personal jurisdiction.

The court found that the website “specifically targeted residents of California.” It further observed that the defendant had conceded that many of its patrons came from California, and that some of those patrons had made reservations using the website. Through these activities, the defendants had “purposefully availed themselves to the privilege of conducting business in California via the Internet.”

Snowney v. Harrah’s Entertainment, Inc., 2005 WL 1324094 (Cal., June 6, 2005).