Inset Sys., Inc. v. Instruction Set, 937 F. Supp. 161 (D. Conn. 1996) (full-text).
Inset Systems is a Connecticut corporation that develops and markets computer software and other related services worldwide. It registered the trademark "INSET." The defendant, Instruction Set, Inc. ("ISI"), is a Massachusetts corporation with its office and principal place of business in Massachusetts. ISI obtained the domain name "INSET.COM" and used this domain name to advertise its goods and services on the Internet.
Trial Court Proceedings
Inset Systems filed suit in Connecticut federal court. ISI did not have any employees in Connecticut, and did not conduct business in the state. However, ISI did engage in advertising on the Internet. In fact, the court found that since March 1995, ISI had been continuously advertising on the Internet, making reference in its advertising to a toll-free number designed to allow viewers of the advertising to contact ISI.
On ISI's motion to dismiss for lack of personal jurisdiction, the court held that it could exercise jurisdiction over ISI under Connecticut's long-arm statute which requires that the cause of action arise out of "any business solicited in this state by mail or otherwise if the corporation has repeatedly so solicited business, whether the orders or offers relating thereto were accepted within or without the state. . . ."
According to the court, ISI had directed its advertising activities via the Internet toward all jurisdictions, including Connecticut. The court described advertising on the Internet as more pervasive than even television or radio advertising. Unlike the latter types of promotion, "in which advertisements are broadcast at certain times only, or newspapers in which advertisements are often disposed of quickly," Internet-based advertising is available to consumers continually "at the stroke of a few keys of a computer."
In addition to finding that ISI had solicited business within the meaning of Connecticut's long-arm statute, the court also held that ISI had the requisite contacts with Connecticut due to its Internet advertising for purposes of satisfying the due process clause of the U.S. Constitution. Beginning from the time ISI placed its advertising on the Internet, ISI had "purposefully directed its advertising activities toward this state on a continuing basis," and could "reasonably anticipate the possibility of being hailed into court here."