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Jurisdiction

The most obvious legal issue that arises with the growth of the Internet is jurisdiction. In order for a court to entertain a lawsuit, it must have jurisdiction over the litigants and the claims; in other words, it must be appropriate for a particular court to decide a particular matter involving particular people. This issue arises in the context of Internet commerce where there is a dispute between people or businesses of different states. Is a customer in New York obligated to travel to Texas to defend himself against a Texas company suing him for breach of a sales agreement? Reciprocally, is a company in Texas forced to endure the costs of litigating in New York? The answers to these questions should affect the approach a business takes in conducting its business over the Internet.

Both state law and the U.S. Constitution limit a court's jurisdiction over a defendant from another state. In order for a court to exercise jurisdiction over a defendant, jurisdiction must be authorized by the state's long-arm statute (state long-arm statutes authorize courts to entertain lawsuits involving non-resident defendants) and satisfy the Due Process Clause of the U.S. Constitution.


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