Seventh Circuit Ruling on Personal Jurisdiction in Hemi Case May Impact All Internet Retailers

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Internet retailers should be aware that a recent U.S. Court of Appeals for the Seventh Circuit case held that a New Mexico company that established an interactive website in New Mexico that could be and was accessed by an Illinois resident to buy cigarettes—and where the product purchased was shipped by the company to Illinois—created due process nexus with Illinois, thereby allowing Illinois to assert personal jurisdiction over the company. In Illinois v. Hemi Group LLC, No. 09-1407 (September 14, 2010), the court held that "Hemi created several commercial, interactive websites through which customers could purchase cigarettes from Hemi. Hemi held itself out as open to do business with every state (including Illinois) except New York. After the customers made their purchases online, Hemi shipped the cigarettes to their various destinations. It is Hemi reaching out to residents of Illinois, and not the residents reaching back, that creates the sufficient minimum contacts with Illinois that justify exercising personal jurisdiction over Hemi in Illinois."

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