Harmonizing cybertort law for Europe and America.

• Author: Rustad, Michael L.

Abstract

In this Article, Michael L. Rustad & Thomas H. Koenig call for a globalized regime of Internet torts to protect consumers and other travelers in cyberspace. Part I of this Article lays out the procedural barriers to the development of cybertorts, focusing on the divergent paths of the law taken by the United States and its European trading partners. The United States follows a standards-driven minimum contacts regime while Europe has adopted the Brussels Regulation, which promulgated bright-line rules. The U.S. adopted a market-driven approach to choice of forum and law, whereas Europe provides mandatory protections for consumers. Part II examines differences in substantive tort law between the United States and Europe. Cybertort cases, especially for the law of defamation, privacy, and anti-spam initiatives, will result in different outcomes in Europe than in the United States because of differences in doctrine. Part III proposes a globalized regime that draws upon the salient features of European and American procedural and substantive tort law. On the procedural side of the law, the authors favor adopting the bright-line rules of the Brussels Regulation, which provides consumers with the right to file suit against Internet service providers and other online intermediaries in their home court. The American market-driven approach has left injured consumers without meaningful remedies in cyberspace. On the substantive side of cybertort law, European consumers and businesses would benefit from the American system of private enforcement through tort law.

INTRODUCTION PART I. CAUGHT IN THE NET: PROCEDURAL BARRIERS TO CYBERLAW DEVELOPMENT [A] Cyber-Jurisdictional Clashes Between the U.S. & Europe [B] Europe's Harmonized Jurisdictional Regime [C] Rome II's Convention on Choice of Law for Torts [D] Choice of Forum in Cyberspace PART II: DISCORDANT CYBERTORT REGIMES: EUROPE V. AMERICA [A] Divergent Defamation Regimes [B] Conflicting Internet Privacy Regimes [C] Deviating Anti-Spam Regimes [D] Conflicting Online Intermediary Law PART III: TOWARDS A HARMONIZED CYBERTORT REGIME [A] Doing Nothing Is Not a Realistic Option [B] Eliminating Procedural Barriers for Cybertort Adjudication [C] Harmonizing Substantive Cybertort Law CONCLUSION INTRODUCTION

Cyberspace is the fastest growing free-trade zone. Internet trade is multi-hemispheric, as the sun never sets on a Web site that stands ready to communicate with customers 24 hours a day, seven days a week in all countries connected to the World Wide Web. Online contracts were estimated to total $71 billion in 2004. (3) By March of 2005, there were approximately 138 million Internet users in the United States (4) and an estimated 888.7 million users around the world. (5) Worldwide Internet business-to-business transactions (6) are expected to total $6 trillion in 2005. (7)

The Internet's blurring of national boundaries creates a variety of new cybertort dilemmas. The global Internet's legal environment makes it inevitable that "one country's laws will conflict with another's--particularly when a Web surfer in one country accesses content hosted or created in another country." (8) National differences among the cybertort regimes of different countries connected to the Internet will inevitably lead to conflicts of law. (9) "Which court will

3. E-Commerce & Internet Business Statistics, at http://www.plunkettresearch.com/technology/ecommerce_statistics_1.htm (last visited April 12, 2005) (estimating Internet usage as of March 24, 2005).

4. Id.

5. World Internet Usage & Population Statistics, at http://www.internetworldstats.com/stats.htm (last visited April 15, 2005) (reporting current world Internet user population as an estimated 888,681,131).

6. B2B is business to business e-commerce and it means exactly what it says: businesses selling to other businesses; factories selling to wholesalers; wholesalers selling to retailers; office suppliers selling to offices; farmers selling to markets; etc. Any deal between two businesses is B2B e-commerce. Dr. Ecommerce, Frequently Asked Questions at http://www.jpb.com/drecommerce/faq.html (visited April 12, 2005).

7. Gartner Group, Worldwide Business-to-Business Internet Commerce to Reach $8.5 Trillion in 2005, at http://www4.gartner.com/5abpit/pressroom/pr20010313a.html (last visited Feb. 3, 2005).

8. Peter Yu, Conflict of Laws in International Copyright Cases, at http://www.gigalaw.com/articles/2001/yu-2001-04.html (last visited April 15, 2005); See also, Julia Lapis, The Internet Tort Dilemma, IT LAW TODAY 1 (Feb. 2002) (commenting that "many countries' legal systems have struggled with the issue of personal jurisdiction and the question of whether a court can legitimately exercise jurisdiction over an individual or company with no physical presence in the judicial forum, but whose web site can be accessed from the forum state.").

9. The conflicting standards between U.S. and United Kingdom defamation law in Internet cases is illustrated by "the 1997 U.S. Court of Appeals case of Zeran v. America Online, Inc., [in which] the plaintiff sued the defendant internet service provider ("ISP") for unreasonable delay in removing defamatory messages posted by an unidentified third party, refusing to post retractions, and failing to screen for similar postings thereafter. The Court held that the Communications Decency Act barred such claims by immunizing commercial interactive computer seize the case is one issue; but which law will be applied is another. We're in Marshall McLuhan's 'Global Village' and we're inventing the roadmap." (10)

   Yahoo!, for example, hosts auction sites, message boards, and chat rooms primarily for U.S. users. (11) A Paris court ruled that messages about Nazis and the sale of Third-Reich memorabilia violated the French Criminal Code.12 Even though Yahoo!'s French subsidiary removed Nazi-related material and images, French users could still access this material by using the American Yahoo! Web site. (13) The court issued an order, fining Yahoo! 100,000 Francs per day until they removed "all Nazi-related messages, images, and text stored on its server, particularly any Nazi relics, objects, insignia, emblems, and flags on its auction site." (14) Yahoo! refused to honor the French court's order, filing a complaint in the Northern District of California, requesting a declaration that the French court's order was unenforceable since it was in conflict with the First Amendment of the U.S. Constitution. (15)

   In Yahoo!, Inc. v. La Ligue Contre Le Racisme et L'Antisemitisme, (16) the California federal court refused to enforce the French order requiring the American Web site to remove Nazi-related materials. The U.S. federal court ruled that the judgment violated U.S. public policy that was protected by the First Amendment. (17) The Ninth Circuit reversed the federal district court's declaratory judgment ruling that the court had no personal jurisdiction over the French authorities. (18) A French criminal court "plans to try Yahoo and Timothy Koogle, its former CEO, for allowing Nazi memorabilia to be sold on the Yahoo! auction site." (19)

   Regulators in European countries have legitimate reasons to institute culturally specific regulations of Web site content. The Nazi occupation of Western Europe during World War II resulted in French laws against the expression of pro-Nazi and anti-Semitic views. In the United States, the First Amendment prohibits the government from restraining political expression, no matter how distasteful. The French court's attempt to impose local rules on world wide information transmissions is analogous to treating the cross-border legal environment as a local ordinance. (20) While "there is no doubt that France may and will continue to ban the purchase and possession within its borders of Nazi and Third Reich related matter and to seek criminal sanctions against those who violate the law," (21) it is unclear how this salutary principle applies to communications going beyond its borders.

   The Yahoo! case raises knotty issues of which governing authority determines what nation-state's criminal code, law of torts, and content regulations apply when information crosses hundreds of borders. Traditional concepts of jurisdiction and enforcement of judgment need to be adapted to the Internet. Transnational cybertorts have yet to address cross-border Internet tort injuries such as the invasion of privacy, computer hacking, releasing viruses (22) or worms, (23) denial of service attacks, and other vulnerabilities unknown before the Internet. No comprehensive treaty or convention sets the ground rules for cybertort causes of action, Internet remedies, or the means for obtaining jurisdiction or the enforcement of judgments.

   This Article examines barriers to the development of Internet torts. Part I explores the procedural hurdles to the development of a harmonized cybertort regime that will protect European and American consumers and businesses in their online activities. On the procedural side of cybertort law, issues of cross-border jurisdiction, enforcement, conflict of law, choice of forum, and differences in substantive law between Europe and America are the thorniest dilemmas impeding the further legalization of cyberspace.

   Part II describes the divergent paths taken by the United States and Europe when it comes to civil wrongs. The American law of torts is based upon the common law, whereas the European law of torts, or delict, (24) is really a residual category of noncontractual relations. (25) The European Commission is seeking to replace the twenty-five national systems of conflicting rules with a "single set of uniform rules, which would represent considerable progress for economic operators and the general public in terms of certainty as to the law." (26)

   Part III develops the case for increased harmonization of Internet torts between the U.S. and Europe so that there can be greater...