Zembrka’s petition to the Supreme Court argued that this decision contradicts rulings in other circuits, which generally require evidence of actual sales or distribution to consumers within the forum state to establish jurisdiction.
“The federal circuits are sharply divided on whether virtual presence and conduct constitute ‘minimum contacts,'” Zembrka’s petition stated. “This divergence among the circuits underscores the urgent need for this court’s review.”
The Case Against Zembrka
American Girl accused Zembrka of selling counterfeit goods online. After being alerted to the lawsuit, Zembrka canceled orders placed by American Girl and refunded the payments. However, the Second Circuit found that offering counterfeit items for sale to New York consumers—even without completed transactions—exposed Zembrka to litigation in the state.
The Second Circuit emphasized that New York’s jurisdiction laws do not require shipment to establish a business transaction. While it acknowledged the burden on Zembrka, a company based in China, the appeals court held that Zembrka “ran the risk of being haled into court” by targeting New York consumers with allegedly infringing products.
Circuit Split Deepens
Zembrka’s petition highlighted conflicting rulings among circuits. For instance, the Third Circuit has previously ruled that online sales originating in Spain and directed at New Jersey were insufficient to meet minimum contacts requirements. Zembrka argued that such inconsistencies create an incentive for plaintiffs to file lawsuits in jurisdictions most favorable to their claims, resulting in legal uncertainty for e-commerce businesses.
Key Takeaways and Representation
The Supreme Court’s decision not to hear the case leaves the Second Circuit’s ruling intact, further muddying the waters for e-commerce sellers facing litigation in the U.S.
